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Central Asia Metals keeps on giving

RESULTS: Copper miner Central Asia Metals has announced a decent final dividend following a successful first year of production
March 27, 2013

Unlike most of its mining peers, emerging copper producer Central Asia Metals (CAML) has delivered on nearly all of its promises following a $60m (£38m) initial public offering in 2010. And shareholders are now reaping the benefits in the form of hefty dividends, a share buyback program and a rising share price.

IC TIP: Hold at 119p

The company brought its Kounrad copper project to production in April 2012 - on time and, unusually for a miner, under budget. In the eight months to end-December, it produced 6,586 tonnes of copper, 32 per cent above guidance. Operations continue to run smoothly despite adverse winter conditions, with the company confirming it is well on track to match or beat guidance of 10,000 tonnes of copper output this year.

The low-cost nature of the operation meant Central Asia generated operating profits of $15m in 2012. Combined with savings on plant construction, this has allowed management to commit to returning $16.3m to shareholders during the first 12 months of operations, including a 3.7p-a-share final dividend that comes on top of 7p-worth of dividends previously announced.

Broker Canaccord Genuity forecasts diluted EPS of 23¢ for 2013 (from 13¢ in 2012).

CENTRAL ASIA METALS (CAML)

ORD PRICE:119pMARKET VALUE:£101m
TOUCH:117-121p12-MONTH HIGH:143pLOW: 67p
DIVIDEND YIELD:9.0%PE RATIO:16
NET ASSET VALUE:84¢NET CASH:$33.7m

Year to 31 DecTurnover ($m)Pre-tax profit ($m)Earnings per share (¢)Dividend per share (p)
20091.14-15.0-46nil
20101.45-6.69-11nil
20111.12-5.94-13nil
201230.6614.781110.7
% change----

Ex-div: 24 Apr

Payment: 29 May

£1=$1.51