- Final dividend of 8p takes total 2020 payout to 14p
- Forecast for consistent production and costs this year
Miners are always going to be bullish on the metals they produce, but Central Asia Metals (CAML) has gone further, handing shareholders a dividend based on copper’s current strength. In February, the metal hit a 10-year high of over $9,600 (£6,979) a tonne (t), but has since come back below $9,000/t.
CAML produces copper at low cost from waste dumps at a former Soviet mine in Kazakhstan. It has announced an 8p per share final dividend, taking the 2020 total to 14p per share. This is equivalent to 57 per cent of 2020 free cash flow, above the company’s dividend policy.
CAML also mines zinc and lead at the Sasa mine in Macedonia. That mine’s performance was overshadowed by a tailings dam leak last year that sent 8,000 cubic metres of mine waste into a river. The company has removed 95 per cent of this from the river and the surrounding environment, having to remove 30,000 cubic metres of material from the area to do this.
This is a strong payout and, even if copper falls back below $7,000/t, CAML is in the money. House broker Peel Hunt is forecasting an adjusted EPS of 43p in 2021, up from 24p in 2020. Buy.
Last IC View: Buy, 189p, 11 Nov 2020
| CENTRAL ASIA METALS (CAML) | ||||
| ORD PRICE: | 252p | MARKET VALUE: | £444m | |
| TOUCH: | 250-251.5p | 12-MONTH HIGH: | 279p | LOW: 117p |
| DIVIDEND YIELD: | 5.8% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 224p* | NET DEBT: | 9% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
| 2016 | 66.7 | 33.6 | 24.3 | 15.5 |
| 2017 | 102 | 49.8 | 29.1 | 16.5 |
| 2018 | 192 | 72.7 | 31.3 | 14.5 |
| 2019 | 172 | 67.8 | 29.4 | 6.50 |
| 2020 | 160 | 59.8 | 24.8 | 14.5 |
| % change | -7 | -12 | -16 | +123 |
| Ex-div: | 29 Apr | |||
| Payment: | 25 May | |||
| £1=$1.38 | ||||
