Highland Gold Mining (HGM) has held off handing investors a half-year dividend because it is in the midst of a takeover. The terms of the offer by Fortiana, controlled by Russian businessman Vladislav Sviblov, means that any amount paid to shareholders would come out of the sale price, as laid out on 31 July in the formal document.
Fortiana has already bought shares from major shareholders – including Roman Abramovich and executive chairman Eugene Shvidler – representing 23 per cent of the company, and is waiting on government approval to take another 16 per cent. After this, Fortiana needs just another 10 per cent to take control. The buyer has also said if it gets more than 75 per cent of Highland it will likely take it fully private.
In what will possibly be its last set of half-year results on the Aim board, Highland saw an 11 per cent increase in cash profits (Ebitda) to $96m (£71.6m). This was less than the 32 per cent year-on-year increase in the realised gold price because production dropped and costs went up across the company’s four mines.
Highland has kept its 2020 guidance at 290,000-300,000 ounces (oz), with chief executive Denis Alexandrov saying gold output would be weighted to the second half. First half production was 124,294oz.
| HIGHLAND GOLD MINING (HGM) | ||||
| ORD PRICE: | 294p | MARKET VALUE: | £ 1.1bn | |
| TOUCH: | 294-295p | 12-MONTH HIGH: | 314p | LOW: 150p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 9 | |
| NET ASSET VALUE: | 266¢ | NET DEBT: | 29% | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2019 | 175 | 56.1 | 12.5 | 5.0 |
| 2020 | 195 | 63.0 | 10.1 | nil* |
| % change | +11 | +12 | -19 | - |
| Ex-div: | na | |||
| Payment: | na | |||
| £1=$1.34 *Half-year dividend decision deferred due to takeover | ||||
