Gold price supports return of AngloGold dividend
The world’s third largest gold producer, Johannesburg-based AngloGold Ashanti, are to renew their dividend for the first time since 2013 amid healthier gold prices, it has been revealed.
AngloGold Ashanti had previously suspended dealing out capital to their shareholders owing to unfavourable market conditions. More recently, however, the relative attractiveness of foreign currencies and a strengthening gold price has made dividends more feasible.
Business has been seemingly erratic for the company, which sits just behind Barrick Gold and Newmont Mining on the gold producing charts, with earnings of $111m in 2016, compared to a loss of $73m previously. Free cash flow was up a staggering amount to $278m.
It has been noted that the company are due to pay out 10% of free cash flow before capital spending on growth.
Bloomberg reported that the company “expects to produce 3.6 million to 3.75 million ounces of gold this year at all-in sustaining costs of $1,050 to $1,100 an ounce”.
AngloGold Ashanti appear to have been biding their time, reducing volatility and debt and increasing earnings. Bloomberg went on to report that “AngloGold is tentatively exploring ways of replenishing its reserves by investing in projects near its existing mines in Brazil, Australia and central Africa”.
However, Bloomberg commented that unlike counterparts at African peers Sibanye Gold Ltd., Harmony Gold Mining Co. and Acacia Mining Plc, Srinivasan Venkatakrishnan, AngloGold’s CEO, has said he’s not interested in out and out acquisitions, because they’re ‘too risky‘.
In other news, three out of the five gold pieces of artwork by Luke Jerram, an artist based in Scunthorpe, have been found. Jerram had hidden the five gold pieces in various locations around the town, the location of which can be uncovered by cracking codes inside specific paintings.
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