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Rio Tinto declares record dividend on 90% surge in FY'17 net earnings

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Rio Tinto declares record dividend on 90% surge in FY'17 net earnings

TOP NEWS

Rio Tinto declares record dividend on 90% surge in FY'17 net earnings

Rio Tinto boosted its dividend for full year 2017 by 71% year over year to a record US$2.90 per share, after a 90% surge in net earnings to US$8.76 billion, or US$4.90 basic earnings per share. The company managed to cut its net debt by 60% during the year to US$3.85 billion, and announced an additional share buyback of US$1.0 billion for 2018. Higher commodity prices pushed the company's revenue during the year to US$40.0 billion, up by US$6.2 billion compared to 2016.

South32 to spin off South African coal assets within 6 months

South32 Ltd.'s South African coal assets will be spun out as an independent business within six months, Reuters reported, citing Mike Fraser, president and COO of the company's African operations. The miner received interest from multiple prospective buyers for the assets that it put up for sale in late 2017 as part of a shift away from coal.

Nutrien engaging with suitors for SQM, Arab Potash stakes

Nutrien Ltd. CEO Chuck Magro said the company is actively engaged with prospective buyers for its interests in lithium producer Sociedad Quimica y Minera de Chile SA and Arab Potash Co. Plc, Reuters reported. Nutrien owns a 32% stake in SQM and an around 28% stake in Arab Potash. Meanwhile, Raef Sully, the president of Nutrien's potash business, said the company wants to shift production to its lowest-cost facilities and might review its options in the second half. The company, which operates six Canadian potash mines, said it remains open to all options, including closing higher-cost mines.

DIVERSIFIED

* Anil Agarwal, the metals tycoon and head of the Vedanta Resources Plc group of companies who also holds a 20% stake in Anglo American Plc, reiterated his appreciation for the miner but said his holdings in the company are of a personal nature, not a strategic move. However, he said he is not an activist shareholder and kept tight-lipped about potential shifts in his stake. "I have no other plan except to remain as an investor. I am always very supportive. The management are very good. We support them and like them."

* Marubeni Corp.'s energy and metals business posted a net income of ¥8.2 billion in the nine months to Dec. 31, 2017, improving by ¥36.6 billion from the same period a year ago, driven by improved returns from its Chilean copper and Australian coal projects, among others. The group's attributable profit in the period rose 53% year on year to ¥164.8 billion.

BASE METALS

* Freeport-McMoRan Inc. reinstated a cash dividend on its common stock on the back of a positive outlook for strong cash flow generation, proposing a quarterly dividend of 5 U.S. cents per share with the initial quarterly dividend expected to be paid May 1.

* According to sources, investors from China, Europe, and the U.S. are allegedly submitting offers for Antofagasta Plc subsidiary Antofagasta Minerals SA's electricity transmission lines connecting the Centinela copper project in northern Chile, daily El Mercurio reported. The company will select a final winning offer by the end of February or in early March, the sources said.

* Fireweed Zinc Ltd. has decided to exercise its option to earn a 100% interest in the Tom and Jason claims and assets, part of the Macmillan Pass zinc project in the Yukon Territory, Canada, from Hudbay Minerals Inc. The company will make the final C$750,000 payment and issue 3,565,406 shares, giving Hudbay a 15% interest.

* Zambia expects to boost its annual copper output to around 1.5 million tonnes from the current 800,000 tonnes, driven by improved electricity supply and eased tensions with producers over policy, Mining Weekly reported, citing mines minister Christopher Yaluma.

PRECIOUS METALS

* Barrick Gold Corp. said that in light of the recent orders by Chile's environmental agency, Superintendencia del Medio Ambiente, to close surface facilities in the Chilean part of the Pascua Lama gold-silver project, the company is reclassifying the project's proven and probable gold reserves of around 14 million ounces, which are based on an open-pit mine plan, as measured and indicated resources. As a result, Barrick expects to book an estimated pretax impairment of US$429 million at Pascua Lama in the fourth quarter of 2017.

* Sibanye Gold Ltd. will consider transferring its primary listing to North America from Johannesburg in order to gain exposure to a wider set of investors, Bloomberg News reported. The company would likely seek to list in New York or Toronto, with the move to allow it to tap capital in the new market and help finance future deals, CEO Neal Froneman said. Sibanye will maintain its listing at the Johannesburg Stock Exchange.

* Coeur Mining Inc.'s year-end 2017 reserves and resources from continuing operations recorded a 10% jump to 335.8 million silver equivalent ounces in the proven and probable categories. Measured and indicated resources improved 42% and 45% from year-end 2016 to approximately 385.7 million silver equivalent ounces and 171.0 million silver equivalent ounces, respectively.

* Endeavour Mining Corp. closed a US$300 million private placement of convertible senior notes, carrying a 3.0% annual coupon, due 2023. In addition, an overallotment option of US$30 million was exercised by the initial purchasers.

* Highland Gold Mining Ltd.'s prefeasibility study for its Belaya Gora and Blagodatnoye operations in Russia pegged a net present value, discounted at 10%, of US$97 million and a 142% internal rate of return. Average annual production is expected at 55,000 ounces over the combined life of mine, expected until 2032.

* Osisko Gold Royalties Ltd. acquired an about 12.48% stake in Algold Resources Ltd. on a partially diluted basis after subscribing to 14,285,714 units of Algold at a price of 14 Canadian cents each.

* Randgold Resources Ltd. CEO Mark Bristow warned that the proposed new mining charter in the Democratic Republic of the Congo will put at risk what Randgold and other mining companies have built in the country. "Unfortunately, all that we and other companies have built has been put at risk by recent developments that amount to no less than an abuse of the partnership concept by one side. At a time when Africa is endeavoring to become a major economic force, this is bad for the continent as well as the industry," Bristow said while speaking at the Mining Indaba in Cape Town, South Africa.

BULK COMMODITIES

* All iron ore mining permits in the Indian state of Goa were canceled by the country's top court, Reuters reported, citing local television channels. All mining in the state will stop after March 15, and companies will need to secure new licenses.

* OAO Metalloinvest installed automated control systems for drilling operations at its Mikhailovsky GOK operations as part of the company's initiatives to increase production efficiency. On-board units were installed at 15 drilling rigs.

* United Co. Rusal Plc intends to complete a feasibility study in 2018 for the construction of a scandium oxide production unit at its Urals aluminum smelter in Russia. The company plans to invest about 50 million Russian rubles to complete the pilot-scale tests and complete the feasibility study to construct an industrial-scale unit.

* Anglo Pacific Group Plc's royalty income for the fourth quarter of 2017 is expected to be between £12.0 million and £12.6 million, compared to £12.3 million a year ago. Full-year 2017 royalty income, meanwhile, is expected to be between £37.0 million and £37.5 million, a surge of about 90% year over year.

* Athens-listed MYTILINEOS Holdings SA and Serbia reached a settlement over a US$40 million compensation awarded to Mytilineos by the International Arbitral Tribunal over a past deal with copper miner RTB Bor.

* Rising metals prices boosted PJSC Magnitogorsk Iron & Steel Works' financial results in the fourth quarter of 2017, pushing profit up year over year to US$375 million from US$208 million a year ago. MMK plans to boost CapEx spending to US$700 million in 2018 from US$664 million in 2017, Andrey Eremin, the company's director of economics, said during an earnings call. Eremin said MMK plans to increase production 2% at its Magnitogorsk iron ore mine. The company is on track to launch production of hot-coiled steel at its Turkish operations at the beginning of July with a potential output of 500,000 tonnes before the end of 2018, he added.

* Minnesota-based Tacora Resources Inc. filed a prospectus for an IPO on the Toronto Stock Exchange as it looks to restart operations at its Scully iron ore mine in Newfoundland and Labrador. The company did not specify terms or a price for the IPO but needs CapEx of about C$205.5 million to restart the mine, which was moved to care and maintenance in 2014 by previous owner Cleveland-Cliffs Inc.

SPECIALTY

* Lithium X Energy Corp.'s securityholders approved the acquisition of all of its common shares and warrants by NextView New Energy Lion Hong Kong Ltd. for a cash consideration of C$2.61 per share and 1 Canadian cent per warrant.

* A deal opening up potential lithium supply for one of the sector's dominant producers may squeeze the flow of capital to less advanced or well positioned lithium juniors, according to analysts. SQM signed an agreement mid-January with the Chilean government's Production Development Corp., or Corfo, following years of struggle to secure a new contract. Given the turn of events, some analysts expect the deal to mute investor appetite for earlier stage lithium companies seeking funds.

INDUSTRY NEWS

* The Democratic Republic of the Congo's proposed new mining code has not been signed into law yet, according to the country's Chamber of Mines. However, this could happen within the next couple of days, chamber President Simon Tuma-Waku told S&P Global Market Intelligence on the sidelines of the Mining Indaba. "It is on the president's table [for final approval] right now, but it has not been signed yet," Tuma-Waku said. "It should be signed within a couple of days."

* Kommersant reported that PJSC Alrosa, PJSC Norilsk Nickel Co., Kinross Gold Corp. and Polymetal International Plc asked the government of Russia to allow the "leading companies" to conduct primary exploration of reserves in the regions without licenses. The right currently only belongs to the state-owned Rosgeology, and Russia's Ministry of Natural Resources is against the initiative.

* Companies including Iron Gold, AngloGold Ashanti Ltd. and Global Atomic Fuels Corp. are considering new projects in Niger, S&P Global Market Intelligence learned on the sidelines of the Mining Indaba.

S&P Global Market Intelligence are owned by S&P Global Inc.

The Daily Dose is updated as of 7 a.m. London time, and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.