Caledonia pays another dividend, opens Zim’s deepest shaft

Caledonia Mining, which counts Zimbabwe based Blanket Mine as its biggest asset, is bullish about its earnings prospects in the years ahead and this week announced another increase in its quarterly dividend by nine percent to US$0.12 a share.

The latest increase becomes the 5th increase by the miner since October 2019.

This makes it a 75 percent cumulative increase from the level of US$0.06875 cents since October 2019.

In announcing the dividend on Tuesday, Steve Curtis, Chief Executive Officer, said:

“We are pleased to announce an additional nine per cent increase in our quarterly dividend, the fifth increase in the past 18 months. This represents a cumulative 75 per cent rise in the dividend since the first increase in October 2019.

“The decision by the Board to increase the dividend reflects our continued confidence in the outlook for our business.”

In addition to increased dividends payments, Caledonia also used US$67 million to develop a new Central Shaft at Blanket Mine.

The Central Shaft, which is the deepest shaft of any gold mine in Zimbabwe, was brought into full operation during the first quarter of 2021.

“This has been an owner-funded and built project by the Blanket team and I would like to thank everyone for their hard work and especially for achieving the completion of the shaft without any serious accidents, recording only two lost time injuries,” Curtis commented.

With the new investment, the miner now targets production of 61,000 to 67,000 ounces of gold in 2021 and 80,000 ounces of gold per annum from 2022.

Scheduled ramp up in production, a firm gold price and good cost control give the Board confidence that the business can sustain a higher level of dividend.

Curtis also said as the miner reaches the end of the six-year investment programme at Blanket Mine, the anticipated combination of rising production and declining capital investment gives confidence to further increase the dividend payment in addition to providing funding for investment in new projects, including the exploration prospects at Glen Hume and Connemara North, as announced at the end of 2020.-ebusinessweekly.co.zw