Iamgold dividends up by 33%

Brian Benza
Staff Writer | Monday December 13, 2010 00:00

 

The dividend will be paid on January 14, 2011 to shareholders of record as at close of trading on December 24, 2010.

In addition, the company has provided guidance for 2011, with gold production expected to increase by approximately 20 percent over the current forecast production for 2010.

In addition to Botswana, Iamgold has operations in Suriname, Burkina Faso, Canada, Mali and Ghana.

Said the company's President and CEO, Steve Letwin: 'The dividend increase reflects the confidence the board and management have in the current and future cash flows for the company.

'We have a superior combination of assets and people, and when you couple that with our strong balance sheet and attractive opportunities, the outlook for growth is very positive.'

In 2011, Iamgold expects attributable gold production to be in the range of between 1.1 million and 1.2 million ounces at a cash cost of between $565 and $595 per ounce, assuming an average spot price for gold of $1,300.

In future, Iamgold plans to pay its dividend semi-annually. For purposes of subsection 89(14) of the Income Tax Act, the company designates all dividends payable on January 14, 2011 to be eligible dividends. North American gold producers, which are benefiting from record gold prices, have announced a series of dividend increases over the course of 2010.

The most recent hike was by Yamana Gold, which announced its third dividend increase for the year to an annualised $0,12 per share on November 3.

Canada's second-biggest producer, Goldcorp, said in late October it would double its shareholder payment while the world's top two producers of the yellow metal, Barrick Gold and Newmont Mining, both announced dividend increases in July.

Iamgold also produces niobium, which is used in specialty high-strength steels, from its Niobec mine in Quebec.

The company expects to produce between 4.7 million and 5.0 million kilograms of the chemical at a margin of between $15 and $17 per kilogram. The group expects production next year will be between 4,7 million and 5 million kilograms of niobium at a margin of between $15/kg and $17/kg.

Iamgold recently completed two expansion projects at Niobec - the company expanded the mill and has also built a paste-backfill plant at the operation.

Meanwhile, as a further update on the status of the Essakane Mine in Burkina Faso, Iamgold says the electrical problem that occurred there in November was fully rectified and the mine is operating at or above nameplate capacity.

The land holding surrounding the current operations continues to exhibit significant upside potential and will be a focal point of the company's 2011 exploration plans.