Central Asia Metals PLC (AIM:CAML, OTC:CAMLF) shares slid 12% yesterday after the miner reported weaker profits, a halved dividend and trimmed guidance from its flagship zinc and lead mine.
First-half earnings before interest, tax, depreciation and amortisation fell to $39.9 million, down from $51.6 million a year ago, as lower sales volumes and higher costs bit into margins.
The EBITDA margin slipped to 40% from 51%. Revenue eased to $99.5 million, while free cash flow dropped to $16.2 million from $30 million.
The interim dividend has been cut to 4.5p from 9p, in line with a new policy to pay out 30–50% of free cash flow. To soften the blow, management announced a $10 million share buyback.
Cash on hand stood at $47.7 million at the end of June, topped up by $18.7 million from selling its stake in New World Resources.
On the operational side, copper production at Kounrad in Kazakhstan slipped to 6,218 tonnes from 6,608 tonnes, while zinc and lead output at Sasa in North Macedonia also declined.
The company has already pared back production guidance at Sasa after ore grades came in below expectations, though it insists its review of mining methods will restore performance in the second half.
Chief executive Gavin Ferrar struck an upbeat note, pointing to strong safety records, low-cost copper output and the completion of capital projects at Sasa.
He also flagged ambitions for future growth, despite missing out on a bid for US-based New World Resources earlier this year.
Investors, however, appear focused on the near-term squeeze. A smaller dividend and shrinking profits left the shares out of favour, even as management sought to reassure with talk of buybacks and long-term growth projects.
The shares fell 20.97p to 152.33p.