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Caledonia is a Mining, Exploration and Development company focused on Southern Africa. Caledonia’s primary assets are a 49% interest in the Blanket Mine ("Blanket") in Zimbabwe and a 100% interest in the Nama base metals exploration project in Zambia. Caledonia’s shares are listed on the Toronto Exchange (CAL), on London’s AIM (CMCL)...Read more
Caledonia Mining declares maiden dividendJanuary 25 2013, 7:23am
Caledonia Mining (LON:CMCL TSE:CAL) has marked a further milestone in its development by declaring a maiden dividend.
The board has declared a first dividend payment of half a cent (C$0.005) per share.
It comes after the firm held a special meeting of shareholders, which approved the firm's plans to reduce its share capital and implement a one-for-ten share consolidation.
President and chief executive Stefan Hayden said today: "The declaration of Caledonia's initial dividend is a further milestone in Caledonia's development as an emerging mid-tier gold miner and reflects Caledonia's strong operational and financial performance.
"The dividend of one-half cent per pre-consolidated share is approximately one-tenth of Caledonia's cash on hand. Caledonia retains the financial capacity to continue to invest in expanding its business."
Earlier this month, broker Canaccord suggested the firm was attractive to investors on a number of fronts.
"With the net cash balance building, Caledonia offers a premium dividend, production and earnings growth versus peers,” it said.
The company trades on a 65% discount to peers on three key metrics, while average annual free cash flow will be US$33m over the next 5 years.
This will allow the company to fund its five-year investment programme of US$37mln internally, while leaving ample room for dividend growth, argued Canaccord.
It has a target price of 16p/share, and forecasts Caledonia will have US$55mln in net cash by the end of 2014, equal to 90% of the current market capitalisation.