Kenmare Resources PLC on Tuesday said both its profit and dividend increased in the first half despite weather conditions affecting production, and launched a $30 million tender offer.
The Dublin-based miner, which operates the Moma Titanium Minerals project in Mozambique, said pretax profit for the first half of 2023 was $77.5 million, up 13% from $68.6 million the prior year.
Revenue increased 23% to a record $242.9 million from $197.3 million. Earnings before interest, tax, depreciation and amortisation increased 5.6% to $110.4 million from $104.5 million.
Kenmare also declared an interim dividend of 17.5 cents per share, up 59% from 10.98 cents for the first half of 2022.
Heavy mineral concentrate production, however, decreased 14% to 633,900 tonnes from 738,300 tonnes the year before, mainly due to lower grades and the impact of a ‘severe’ lightning strike in the first quarter. Consequently, total finished product production decreased 10% to 472,600 tonnes from 550,700 tonnes.
Kenmare also said demand and prices for ilmenite remained stable during the period, particularly in China, although the titanium pigment market has slowed in the last couple of months. It added that tougher macroeconomic conditions like softening spot prices have reduced demand for zircon as ceramics producers - which use zircon to enhance whiteness and opacity - operate at reduced utilisation levels.
Looking ahead, Kenmare said it expects to report strong results for the second half, despite ‘slightly muted’ market demand. It also said it will ‘continue to manage its operating cost base in a conservative and sustainable manner,’ and maintain a ‘robust and flexible’ balance sheet.
Also on Tuesday, Kenmare announced the launch of a tender offer for up to 5.9% of its issued shares at £4.22 per share. This should return up to $30 million, or £23.6 million, to eligible shareholders.
The tender offer is subject to approval by shareholders at an extraordinary general meeting on the morning of September 8. If approved, the offer will close at 13.00 BST that day.
Kenmare shares were up 2.2% at 431.21 pence on Tuesday morning in London.
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