Precious metals miner Hochschild Mining (LSE: HOC) reported its strongest financial performance since 2012 on Wednesday and restored its dividend thanks to record gold and silver prices in 2024.
The South America-focused company posted a pretax profit of $177.2 million (C$254.7 million), a sharp turnaround from its $43.5-million loss in 2023, when restructuring charges and impairments weighed on results.
The London-based miner declared a final dividend of 1.94¢ per share, amounting to at least $10 million for shareholders. The last time the company rewarded its shareholders was in 2022, with a 1.95¢ interim payout.
“We are pleased to announce our best financial performance for 13 years, a testament to our exceptional team and high-quality assets,” CEO Eduardo Landin said.
He added that the company’s growth strategy had delivered a record 2.8 million gold-equivalent oz. of mineable resources, extending the life of all current operations.
Cash flow
UK investment bank Peel Hunt said the resumption of dividends signalled financial discipline and, coupled with increased exploration, would extend cash flow duration.
Shares gained 14% to close at 218 pence apiece, giving Hochschild a market capitalization of £1.1 billion (C$2.1 billion).
Attributable production in 2024 totalled 347,374 gold-equivalent oz. comprising 245,000 oz. of gold, up 32% from 186,000 in 2023, and 8.5 million oz. of silver, down 11% from 9.5 million.
Hochschild expects to produce between 350,000 and 378,000 gold-equivalent oz. this year, with its new Mara Rosa gold mine increasing output further.
Mara Rosa, located in Goiás state, is Hochschild’s first operation in Brazil, a country where it is expanding its footprint. Last year, the miner acquired the Monte Do Carmo project for $60 million, with $45 million already paid.
Other than in Brazil, Hochschild has mines in Peru and Argentina as well as development projects in Chile and Peru.
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