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Rio Tinto declares record dividend after 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 cut its net debt 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 US$6.2 billion compared to 2016.

China looking to accelerate targeted steel capacity cuts by 2 years

The Chinese government is accelerating its targeted steel capacity cuts, aiming to complete the 150 million-tonne reduction this year instead of the initial 2020 deadline, Reuters reported, citing the Ministry of Industry and Information Technology.

Ivanhoe chairman joins executives opposing new DRC mining code

Robert Friedland, executive chairman of Ivanhoe Mines Ltd., has joined the growing number of industry executives voicing opposition to the proposed new mining code in the Democratic Republic of the Congo. "The mining industry is sick and tired of being gored," Friedland told attendees at the Mining Indaba in Cape Town, South Africa. The executive said he was not necessarily unwilling to pay higher royalties and taxes but said the funds should be used to support and empower local communities. At the same time, he said there must be a stable environment for investors.

DIVERSIFIED

* Anglo American Plc plans early redemption of all of its outstanding US$750 million 9.375% notes due April 8, 2019. The notes will be redeemed March 9 at a price equal to the greater of 100% of the principal amount of the notes and the sum of the present values of the remaining scheduled payments discounted to the redemption date on a semiannual basis at the treasury rate plus 50 basis points.

* Rio Tinto CEO Jean-Sébastien Jacques said the company is "comfortable" with its dual-listed structure at present, the Financial Times reported. Jacques said the listing structure did not create any problems for the company, but in the "medium and long-term" if the tax environment changed then it could be changed. The executive also said that Rio Tinto has the capacity to add more assets, but it will only do it "at the right value."

* Rio Tinto repurchased 125,300 ordinary shares of 10 British pence per share from J.P. Morgan Securities plc as part of its share buyback program. The program is expected to be completed by Dec. 31.

BASE METALS

* Canada's Strongbow Exploration Inc. is looking to list its shares on the London Stock Exchange's AIM this year as part of its plans to raise funds to restart production at its South Crofty tin project in the U.K., Reuters reported, citing CEO Richard Williams.

* The Mining Cadastre Department of Zambia terminated mining rights for BMR Group Plc's Kabwe lead-zinc-vanadium project in the country. The development comes a day after Jubilee Metals Group PLC decided to exercise its option to earn a 40% interest in the Kabwe project, raising its stake to 57.14%.

* ASX-listed Odin Metals Ltd. and subsidiary Evandale Minerals Pty. Ltd. secured a three-year option for the right to explore or purchase First Quantum Minerals Ltd.'s Sturgeon Lake properties in Ontario. The Sturgeon Lake properties, which are highly prospective for volcanogenic massive sulfide-style copper and zinc mineralization, are adjacent to Odin's existing Sturgeon Lake project.

* ECobalt Solutions Inc.'s share price surged over 13% in Toronto on Feb. 7 after it announced an updated resource estimate for its preproduction-stage Idaho cobalt property. Total measured and indicated resources increased to 45.7 million pounds of contained cobalt, 65.8 million pounds of copper and 68,000 ounces of gold hosted within 3.9 million short tons of ore grading 0.59% cobalt, 0.85% copper and 0.017 oz/t of gold.

* Cougar Metals NL signed a letter of intent to acquire the Plateado cobalt project in Chile.

* Copper produced from the Democratic Republic of the Congo rose 6.9% to 1.09 million tonnes in 2017, cobalt surged 15.5% to 73,940 tonnes and gold increased 2.7% to 23,270 kilograms, Reuters reported, citing data from the country's Chamber of Mines.

* New Century Resources Ltd. entered into off-take deals for zinc concentrate produced at its Century mine in Queensland, Australia, with Mercuria Energy Trading SA and Transamine Trading SA. The company's concentrate tender process was for up to 1.5 million tonnes of zinc concentrate from the mine, which covers about 3.5 years of output, and the off-take deals are for about half of the tender.

PRECIOUS METALS

* Royal Gold Inc. booked an attributable net loss of US$14.8 million in the second quarter of its fiscal 2018, swinging from a year-ago profit of US$28.1 million. The company recorded an expense of US$26.4 million in connection with U.S. tax reforms. Quarterly revenue, meanwhile, rose to US$114.3 million from US$107.0 million in the year-ago quarter.

* Coeur Mining Inc. swung to a net profit of US$14.3 million in the fourth quarter of 2017 from a year-ago loss of US$10.3 million. Revenue rose to US$214.6 million from US$139.2 million a year earlier. The company attributed the strong results to record silver equivalent production.

* Hecla Mining Co.'s posted its highest-ever levels of gold, silver and lead reserves and the highest zinc reserves in five years. The company's gold reserves swelled 12% over 2016-end to 2.3 million ounces and silver reserves were up 3% to 177 Moz. Lead reserves increased 8% to 737,290 tons, while zinc reserves jumped 15% to 840,870 tons.

* Zijin Mining Group Co. Ltd. is targeting mine production of 37 tonnes of gold, 244,000 tonnes of copper, 274,100 tonnes of zinc and 37,600 tonnes of lead in 2018. The company will also produce 213 tonnes silver and 2.6 million tonnes of iron concentrate.

* PJSC Norilsk Nickel Co. signed an agreement with Russian Platinum to forge a strategic partnership and establish a 50/50 joint venture, which will aim to become among the largest producers of platinum group metals, targeting annual PGM output of 70 to 100 tonnes.

* Pan African Resources Plc terminated talks to acquire certain assets and liabilities of Asa Resource Group Plc, which is under administration.

* Aquila Resources Inc. released an updated resource estimate for its polymetallic Back Forty deposit in Michigan, which incorporates results from an additional 22 diamond drill holes completed in 2015 through 2017 as well as updated net smelter return calculations. The company outlined a 10% increase in measured and indicated tonnage, as compared to the 2013 estimate, as well as a 12% increase in contained zinc and a 4% increase in contained gold.

* A pre-feasibility study for Highland Gold Mining Ltd.'s Belaya Gora and Blagodatnoye gold operations in Russia pegged a net present value, discounted at 10%, of US$97 million and a 142% internal rate of return.

* K92 Mining Inc.'s Kainantu gold-silver mine in Papua New Guinea achieved commercial production Feb. 1.

* The silicosis class-action suit against a number of South African gold majors is likely to be settled within nine months through a 9 billion South African rand distribution to miners suffering from the lung disease, Graham Briggs, chair of the Working Group on Occupational Lung Disease, told Reuters.

* Two workers died at Sibanye Gold Ltd.'s Kloof gold mine in South Africa after a fall-of-ground incident at the Ikamva 4 Shaft, and operations at the affected area will remain suspended until an investigation is completed.

* Avanco Resources Ltd. said contained resource at the Blanket deposit, part of its CentroGold project in Brazil, increased by about 20%, taking the project's total resource estimate to about 2.0 million ounces.

BULK COMMODITIES

* Peabody Energy Corp. posted net income attributable to stockholders of US$317.4 million in the fourth quarter of 2017, compared with a loss of US$192.7 million in the same quarter in 2016.

* ArcelorMittal is said to be selling its entire 29.1% stake in India's Uttam Galva Steels Ltd. to the company's founders at less than the market price of the stock, a member of Uttam Galva's founding Miglani family told Reuters. Meanwhile, Business Standard had reported that ArcelorMittal agreed to sell about 41.3 million Uttam Galva shares at 1 Indian rupee each.

* Brazil's antitrust watchdog CADE conditionally approved ArcelorMittal Brasil SA's takeover of Votorantim Siderurgia SA Reuters wrote. The regulator asked the ArcelorMittal unit to sell assets, including a long steel producing unit in the country's Espirito Santo state. If ArcelorMittal fails to strike a deal, the assets will be auctioned.

* Cia. Siderúrgica Nacional is considering a sale of its assets to cut debt but is not "under pressure" to do so as it expects to conclude ongoing negotiations on debt refinancing with Brazilian banks, Reuters reported. "We may opt to sell assets instead of being pressured to do it," director Luis Fernando Martinez said. Martinez said the company will consider "all alternatives" for asset sales, citing container terminal and operations in Germany, Portugal and the U.S.

* China's iron ore imports in January reached 93.7 million tonnes, one of the highest levels on record, while February shipments already have exceeded 70 million tonnes, according to Reuters' ship-tracking data.

* 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.

* EuroChem Mineral Chemical Co. OJSC postponed the launch of a potash plant at the Usolsky project in Russia for two months after a fire broke out at the construction site in December 2017, Vedomosti reported. The first batch of finished products is now expected in late February or early March.

* 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 is expected to be between £37.0 million and £37.5 million, a surge of about 90% year over year.

* One person was killed while another was injured in a rockfall event at Evraz Plc's Osinnikovskaya coal mine in Russia, Vedomosti reported.

SPECIALTY

* Cerberus Capital Management LP affiliate agreed to acquire Cyanco Holding Corp. from funds managed by Oaktree Capital Management LP. Cyanco is the largest global producer of sodium cyanide, an input in the gold and silver mining industry.

* PJSC Alrosa is actively looking to expand its footprint globally, the company's vice president for African operations told S&P Market Intelligence on the sidelines of the Mining Indaba in Cape Town, South Africa. Vladimir Marchenko said the company has been approached by many different countries, including Zimbabwe, Venezuela and India, but Alrosa is focused on "the widely unexplored Angola."

INDUSTRY NEWS

* Russian President Vladimir Putin is set to meet with the leaders of metals businesses operating in the city of Krasnoyarsk to discuss locals' environmental concerns, Reuters reported, citing Kremlin spokesman Dmitry Peskov.

* Martin Kabwelulu, the Democratic Republic of the Congo's mines minister, refused to say whether President Joseph Kabila already signed the proposed mining code into law, when asked during the Mining Indaba in South Africa. According to Reuters, the minister only confirmed that the code is "with the president."

* China's success over the past two years transitioning its growth driver from pure construction to a more consumption-based, "middle economy" approach and its need for higher-quality iron ore is paving the way for continued positivity this year for Australia's miners, Deloitte experts said. According to Deloitte Access Economics' Western Australia leader, Matt Judkins, exploration had picked up across several commodities, particularly gold given the strong performance of the Australian-dollar gold price of late, and in booming technology metals like lithium.

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

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