London-listed Kenmare Resources has posted an exceptional 227% increase in its dividend for the year ended December 31, 2021, to $32-million, or $0.32 apiece.

This compares with a dividend of $0.10 apiece posted in 2020.

Kenmare returned more than $100-million to shareholders in 2021, as it also completed a share buy-back in December, returning $81-million to eligible shareholders and reducing the number of shares in issue by 13.5%.

MD Michael Carvill attributes the company’s sound performance to lower-cost mining and higher grades from a new zone having been mined at its Moma Titanium Minerals mine, in northern Mozambique, from end-2020.

Kenmare now mines the original Namalope area, as well as the Pilivili ore zone.

The company’s heavy mineral concentrate (HMC) production volumes improved by 30% in the year under review to a record 1.55-million tonnes.

Particularly, ilmenite production rose by 48% in the year under review to 1.11-million tonnes, while primary zircon output totalled 56 300 t and rutile output reached 8 900 t.

Carvill mentions that 21% higher average sales prices were achieved, coupled with a 51% increase in shipments of finished products to 1.3-million tonnes, supporting a 182% year-on-year increase in earnings before interest, taxes, depreciation and amortisation to $216-milion.

Profit after tax amounted to $128-million, which was a 669% increase relative to the $16-million profit posted in 2020.

Kenmare noted an 18% decrease in cash operating costs per tonne from $188/t in 2020 to $154/t in 2021, owing to increased product volumes.

Kenmare remains on track to produce between 1.12-million and 1.22-million tonnes of ilmenite, between 54 400 t and 63 200 t of primary zircon and between 9 500 t and 11 500 t of rutile this year. 

Carvill foresees continued strong global demand for ilmenite, Kenmare’s primary product this year, but says dampened economic growth globally as a result of the war in Ukraine and its impact on supply chains may result in reduced demand for titanium feedstocks.

Meanwhile, the company has started commissioning its $18-million Rotary Uninterruptible Power Supply (Rups) plant, which is expected to deliver benefits in terms of power stability, operating cost reductions and lower carbon emissions through reduced use of diesel generators.

The plant is the main contributor to Kenmare’s plans to achieve a 12% targeted carbon emission reduction by 2024.

Speaking of carbon emission reductions, Kenmare will in coming weeks publish its inaugural Climate Strategy Report, alongside its second Sustainability Report.

Carvill says the company aims to achieve carbon neutrality by 2040 and mentions that the company is already a low emitter from the get-go of the Moma mine, thanks to Mozambique’s hydroelectric-powered grid.

Speaking about the company’s growth plans, Carvill mentions that a prefeasibility study for the Nataka project remains on track for publication this year. That will be followed by a definitive feasibility study, before Kenmare plans on moving its wet concentrator plant A to the area in 2025.

The studies will include details of the mining method, relocation, provision of water and power, an HMC pumping system and plans for tailings disposal.

Nataka is the long-term ore zone for Moma and Carvill believes it can sustain the company’s operations in Mozambique for a century to come.