Kenmare Resources, a world-leading titanium minerals and zircon producer, announced its intention to distribute $50 million (€46 million) dividends based on its profits from last year, thereby raising the total shareholders’ dividends to $250 million since 2019. Last year’s Earnings before Interest, Taxes, Depreciation, and Amortization (EBITDA) amounted to $220.3 million, according to a Wednesday announcement from the company. Even though this is the second-best result in the company’s history, it is 26 percent lower than 2022’s outcome due to a slump in mineral prices.
The cost of Ilmenite, a mineral used in the manufacture of products ranging from paints and plastic to ceramics and textiles, surged by two-thirds to $364 a tonne between 2021 and 2022 due to limited global supplies caused by the Covid-19 pandemic and Russia’s Ukraine invasion. Ilmenite prices have, however, decreased since. Kenmare’s Moma mine in Mozambique also suffered production setbacks due to a severe lightning strike last year.
Kenmare’s share value has dipped by almost one-third over the preceding year. Active investment manager JO Hambro, which holds a little over 6 percent of Kenmare’s shares and is based in London, wrote to the company’s board in February asking it to consider its “strategic options”. Hambro suggested an outright sale of the Dublin-listed business amidst its current devalued stock.
The disappointing trading update released before Christmas last year which indicated lower production expectations at the Moma mine for 2024 and increased investment costs on a significant project, led to this year’s delayed plunge in stock prices, as pointed out by Hambro. Lastly, it was reported last week that Kenmare’s founder and managing director Michael Carvill, who established the company in 1986, is set to resign later this year.