TORONTO – Iamgold Corp. (TSX:IMG) says production is lower and cash costs are higher than expected in the second quarter, but it is nearly tripling its annual dividend to show management has confidence in future cash flow.
Iamgold said late Tuesday that it will boost its annual dividend to 20 cents per share, from eight cents per share.
The next semi-annual dividend will be paid on July 20 to shareholders of record as of July 5. The next payment is worth 10 cents per share.
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The company said it boosted its dividend to reflect the confidence the board and management have in current and future cash flows as the company reports lower gold production than expected for the second quarter, and higher than anticipated cash costs.
The company said its production was hit due to a change in mining sequence that resulted in a lower than predicted grade at its Rosebel mine in Suriname, as well as down time at its Essakane mine in Burkina Faso due to a brief water shortage.
“Despite these challenges we are expecting improved production in the second half of the year allowing us to meet our production guidance,” Iamgold’s CEO Gord Stothart said in a statement late Tuesday.
Stothart added that the industry is experiencing higher costs for fuel, consumables and labour this year.
Toronto-based Iamgold has eight mines in South America, Africa and Quebec.
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