The Kenmare Board is recommending a 22% increase in dividends for 2020 with a final dividend of USc7.69 per share. In line with plans to increase shareholder returns, they are also increasing their target dividend payment from a minimum of 20% profit after tax to 25% for 2021.
Other financial highlights include:
- Development projects and operations continued throughout 2020, despite significant impacts of the COVID-19 pandemic
- The number of people in isolation due to COVID-19 has reduced from 177, reported on 10 March, to 112 on 22 March. Testing of the workforce is now being completed weekly.
- The relocation of WCP B was successfully completed in Q3 (total costs expected to be <US$127 million) and WCP C commenced production in February 2020
- Board approved RUPS capital project of US$16 million for increased power stability and reduced carbon emissions
- Total development capital of US$58 million expected in 2021, including RUPS and other projects previously outlined
- Ilmenite production of 756,000 tonnes, a 15% decrease compared to FY 2019 (892,900 tonnes) due to lower HMC consumption, changes in intermediate stocks and lower ilmenite recoveries in FY 2020
- Total shipments of finished products of 853,100 tonnes, down 17% (2019: 1,029,300 tonnes), due to lower production volumes, poor sea conditions, and works to upgrade transhipment capacity
- Revenues of US$243.7 million, a 10% decrease (2019: US$270.9 million) resulting from reduced volumes, partially offset by increased average prices
- Cash operating costs per tonne of US$188 per tonne within August 2020 guidance range, up 19% compared to 2019 (US$158 per tonne), due primarily to lower production volumes. Net ilmenite unit costs increased to US$125 per tonne (2019: US$81 per tonne), due to lower production volumes and co-product revenues
- EBITDA of US$76.7 million, down 17% (2019: US$92.6 million) due to lower revenues, representing a 31% EBITDA margin (2019: 34%)
- Profit after tax of US$16.7 million, down 63% (2019: US$44.8 million), due to lower EBITDA, increased depreciation charges and finance costs
- Net debt position of US$64 million at year-end 2020, compared to US$13.7 million net cash at the end of 2019, primarily due to investment in development projects