Policy change pays off for Evolution shareholders
PERTH (miningweekly.com) – Australian midtier gold miner Evolution Mining has increased the final dividend for the 2019 financial year by 50%, as its new dividend policy kicks in.
The new dividend policy, which was approved in August, is based on the free cash flow generated during the year, with shareholders expected to receive around 50% of this cash flow.
Evolution on Thursday reported that the statutory net profit for the full year ended June had declined from the A$263.4-million reported in the 2018 financial year, to A$218.2-million, while underlying net profits reduced from A$250.8-million in the same period to A$218.2-million.
Sales revenue for the full year declined slightly from A$1.54-billion to A$1.5-billion, on the back of lower gold production, with 753 001 oz produced in the full year, compared with the 801 187 oz produced in the previous financial year.
Sales revenue for the 2019 financial year was also impacted by lower copper and silver revenues, which resulted from both a decline in volume and price.
Operating cash flows for the year reached A$771.5-million, down from the A$811.8-million last year; however, Evolution’s cash balance increased at the end of the 2019 financial year from A$323.2-million to A$335.2-million.
“Our exceptional free cash flow generation, after investing in growth opportunities within our business, has enabled us to further increase the final dividend by 50%, to a fully franked 6c a share,” said executive chairperson Jake Klein.
He noted that with the current spot price for gold around A$450/oz higher than the A$1 760/oz gold price achieved in the 2019 financial year, Evolution was remaining focused on maintaining is low-cost base to bank every additional dollar and return the excess funds to shareholders.
For the 2020 financial year, Evolution is expecting gold production to reach between 725 000 oz and 775 000 oz, with all-in sustaining costs expected at between A$890/oz and A$940/oz.
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