Centamin (CEY) has made the most of the gold price in the first half of 2020, and shareholders will reap the rewards.
The Egypt-focused miner increased production at Sukari and dropped its costs year-on-year, resulting in a cash profit for the period more than double last year’s, at $256m (£196m).
The interim dividend of 6ȼ per share was ahead of analyst expectations, and the year-end payout could be increased again.
Production for the half was 256,084 ounces (oz), a 9 per cent uptick on the first half of 2019. The average realised price was $1,657/oz, a 27 per cent increase, and the all-in sustaining cost was $899/oz. This cost measure includes sustaining exploration at the mine site as well as refining costs.
Adjusted free cash flow was $102m in the half, compared to $36m the year before. This will come down in the second half as capital spending is ramped up again. Capex guidance for the full year is $150m-$170m, with $100m to come between July and December because of Covid-19 constraints earlier in the year.
Berenberg is forecasting a 2020 dividend of 22ȼ and free cash flow of $323m.