AngloGold Ashanti Ltd. will double its dividend payout ratio after gold prices surged this year and the company’s borrowings fell to the lowest in nearly a decade.
AngloGold will now return 20% of free-cash flow before growth capital to shareholders, up from 10%, the world’s third-largest gold producer said in astatement on Monday. The payout frequency has also been doubled to twice a year.
AngloGold’s free-cash flow in the three-months through September rose nearly fourfold to $339 million after gold prices jumped and capital spending declined. Adjusted net debt fell 47% from a year earlier to the lowest level since 2011.
AngloGold, which operates in Africa, Australia and the Americas, has spent the past few years seeking to exit smaller and higher-cost assets to focus on its most-profitable mines. The company is searching for a new chief executive officer after Kelvin Dushnisky announced his departure in July.
“Doubling our dividend payout ratio demonstrates confidence in our ability to both improve direct returns to shareholders and to self-fund our growth projects and sustaining capital requirements,” interim CEO Christine Ramon said in a statement.
AngloGold maintained its most recent production forecast of between 3.03 million ounces and 3.10 million ounces this year.
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