Caledonia Mining declares quarterly dividend of US$0.14 per share
…as miner plans to open new mines

By Almot Maqolo

HARARE – Companies frequently provide a portion of their profits to shareholders in the form of dividends. Dividend payments are a means to give investors a return on their money. The board of directors releases a proclamation outlining the amount and timing of payouts. Having monitored them but definitely considering the publications so far, common in all is the declaration of dividends. In some cases, however, a company may report a profit in its financial statements but fail to generate cash, resulting in the inability to pay dividends.

The situation is different at the gold miner Caledonia Mining Corporation as they religious award their shareholders. This comes as the board of directors has declared a quarterly dividend of US$0.14 on each of its shares. The company, which aims to become a multi-asset gold producer, also said it is on track to reach its target production of between 73,000 and 80,000 ounces of gold this year.

It added that it continues to evaluate investment opportunities in Zimbabwe and elsewhere. “Although the dividend continues to be a central part of our strategy, I am very excited about the opportunity that we have to evolve our business in Zimbabwe and de-risk it from being a single asset producer,” Mark Learmonth, chief executive, commented. Caledonia will update the market on its progress in due course, it said.

This comes after the company’s Blanket mine saw gold production rise 40% to 18 515 ounces for the quarter ended March 31, 2022 from 13 197 ounces in the prior period last year. “I am delighted that during this quarter we have set a new first quarter production record. 18 515 ounces is ahead of our expectations and reflects the increased capacity at Central Shaft,” chief executive officer Steve Curtis said in April.

The miner invested approximately US$67 million in its central shaft at Blanket Mine which was commissioned in March 2021. Completion of the Central Shaft is also expected to give Caledonia the financial capacity to evaluate and implement new growth projects. “The ramp-up in production towards our quarterly target of 20,000 ounces means that we are on track to meet our annual production target,” Curtis said.

Caledonia Mining Corporation had an annual average growth rate in output of 4% since 2017. While the company has decided not to exercise its option on the Glen Hume Mine, analysts say open-cast mines Connemara North and Maligreen Goldfields, each with an annual historic output of 20 000 ounces, remain on the table.

Caledonia’s strategy to maximise shareholder value includes a quarterly dividend policy, which the Board adopted in 2014. The Board will consider future increases in the dividend as appropriate, in line with its prudent approach to risk management. The dividend will be paid to shareholders on July 29.