Anglo Pacific lift 2019 dividend following Australian success

Anglo Pacific Group PLC (LON:APF) have given shareholders an impressive update on Monday which have seen shares in green.

Anglo Pacific Group PLC is a global natural resources royalty and streaming company.

The Company’s strategy is to develop a leading international diversified royalty and streaming company with a portfolio centred on base metals and bulk materials,

The firm said that the Kestrel Mine, which is located in Australia has helped the firm achieve another record year off trading.

Anglo Pacific receives royalties from the Kestrel mine, and holds a vast portfolio across the globe.

The company has guided for £57 million to £59 million in royalties for 2019, which would be 16% to 20% higher year-on-year. In 2018, royalties were around £3.5 million.

The Kestrel mine performed well along side the Labrador Iron Ore Co of Canada. Anglo Pacific also received maiden royalties from the Mantos Blancos copper mine in Peru.

The company have said that they will be lifting their dividend to at least 9 pence per share for 2019 compared to 8 pence one year ago.

Julian Treger, Chief Executive Officer of the Company, commented:

“We are pleased to report yet another record year of income for Anglo Pacific, the second year in a row in which we have done so. Including the cash received from the Denison financing arrangement, total portfolio contribution for the year is expected to be £57-59m, which represents growth of ~20% on the £49.3m generated in 2018.

Our income benefitted mainly from volume increases in the year, somewhat offset by the softening in commodity prices, particularly coal and vanadium, during H2 2019. We anticipate further volume growth to come in 2020, with increases expected at Kestrel, Narrabri and Maracas.

The strong levels of cash generated in 2019 enabled us to use our balance sheet to acquire £62.5m (US$75m) in income generating royalties. In the same period, we paid out £14.4m (US$18.5m) in dividends. Our balance sheet remains in a very strong position and we continue to operate with appropriately conservative levels of operational leverage.

It is likely that the extractive industry will face further headwinds in 2020 and accessing capital will be more difficult. This should create opportunities for Anglo Pacific, and we will prioritise those commodities essential to deliver the technology required to achieve environmental and climate change targets in the years ahead.”

Australia produces mining results across sector

Rockfire Resources (LON:ROCK) who also operate in Australia have seen a successful period of trading.

Today, the firm said hat it has started drilling to expand gold mineralization at its BPL025 hole in Australia.

The firm said that reverse circulation drilling is now being undertaken and will be completed within a 15 day period.

Geophysical anomaly will be tested by drilling two holes of 50 meters and 150 meters respectively, east of hole BPL025, with gold analyses to follow the completion of drilling.

The drilling program will aim to extend the near-surface gold resources at Plateau in north Queensland, the company noted.

David Price, Chief Executive Officer of Rockfire, commented:

“This current drill program is a very exciting one, as we are testing at depth to the east of hole BPL025, which was a very successful hole. Success with this follow-up drilling will demonstrate significant extension of this deep gold mineralisation in an east-west orientation.”

Additionally, In November, the firm reported that it had seen consistent gold assays from an operation in Australia.

The firm updated shareholders that it had returned broad consistent gold assays from a geophysical target on its Plateau gold project.

Of particular note was gold mineralisation occurring almost continuously throughout a 215 metre deep hole, including 177 metres at 0.5 grams per tonne gold.

The update from Anglo Pacific is certainly impressive, and shareholders will be pleased that the firm has decided to lift its dividend for 2019.

Shares in Anglo Pacific trade at 182p (+0.51%). 20/1/20 14:19BST.

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