Antofagasta More Than Doubles Dividend

PUBLISHED: Mar 12 2013 @ 07:24 | Comments (0) | More info about Kenneth G. Mondero

Gold and copper producer Antofagasta plc (LSE:ANTO) saw its shares rose on the London Stock Exchange on Tuesday after the company announced it will be paying out dividend for 2012 in the amount more than twice it gave the year before, following record production and revenue.

In the company’s preliminary results released earlier today, the Chile-focussed mining firm will giving out a final ordinary dividend of US$0.125, in addition to the US$0.085 interim dividend it announced in September of last year, plus a special dividend of US$0.775 per share, or a total of US$0.985.

The 2012 dividend is more than twice what was given in 2011 – at US$0.44 a share – and also beat market analysts’ estimate of only US$0.576.

Antofagasta was able to more than double its net cash by the end of 2012 from US$1.1 billion to US$2.4 billion, backed up by record volume production of gold and copper that offset weaker price for the said commodities during the inclusive period.

Important Year

The FTSE 100 firm, which also has interests in transport and water distribution in in Chile, raised its revenue by 10.9% to US$6.7 billion owing to the increase in gold production – more than half of what produced in 2011 – to 229,000 ounces.

“2012 was an important year for the Group, in which we consolidated the performance of our existing operations, and strengthened our organisation for the future opportunities we face,” stated Diego Hernandez, Chief Executive of Antofagasta Minerals.

However, the firm was hit by rising on-site and shipping costs for its copper mining division and an impairment cost of US$500 million was charged for its Antucoya project, which was temporarily suspended due to escalating cost.

Net profit was down 18.6% to US$1.73 billion, resulting in a 16.5% drop in basic earnings per share from US$1.25 to only US$1.04.

Shares of Antofagasta, nonetheless, gained 52 pence, or 4.75% to £11.47 by 11:00 GMT, after reaching as high as £11.57 in early morning trading.

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