Trans-Siberian Gold (TSG) ended 2019 having produced a record amount of gold at significantly higher prices than the year before, but with its shares trading at less than half last year’s high of 120p.
The production numbers saw a further 12 per cent fall in the share price, to 50.5p. In 2019, Trans-Siberian produced 43,479 ounces (oz) of gold, a 3 per cent increase on 2018, and brought in revenue of $63m (£48m), a 5.5 per cent jump year on year. The sell-off could have been a reaction to the Asacha mine’s last-quarter gold sales drop-off of 25 per cent year on year. Trans-Siberian said the decrease at the end of 2019 was because of a move from a higher-grade mining area.
The miner is 75 per cent owned by UFG Asset Management, a Moscow-based private equity firm. Another major shareholder, Destin Investment Management, has been selling off its shares, from over 13 per cent in in May, to 4 per cent in December through a buyback programme. This month Destin’s holding fell just below 3 per cent.
Trans-Siberian said its dividend was not under threat, and issued payback guidance of $3m for 2020. Given the 87m shares in issue (with 23m in treasury), this gives a payout of 4.67¢ per share. The company also said it would pay a special dividend "if appropriate". Production guidance for 2020 sees a fall on last year's performance, at 38,000 oz to 42,000 oz, with an all-in sustaining cost of $900 an oz to $1,000 an oz.
