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Major Eskom coal supplier Exxaro declares dividend to ‘fixed’ performance

Exxaro Resources, one of Eskom’s largest coal suppliers, announced a definitive cash dividend of R11.75 on the back of booming commodity prices and good operating performance for the year ended December.

In announcing its annual results on Thursday, Exxaro reported a 13% increase in group revenue to R32.8 billion and a 77% jump in profit to reach R16.3 billion, while headline revenue increased by 56% to R11 56 billion.

The group declared a final cash dividend of R11.75 per share, pushing the total dividend for the year to R32.52, up from R18.86 in the previous year.

Exxaro said the “solid performance” was despite the ongoing Covid-19 pandemic, northern local economy, and extensive logistical challenges that substantially affected export volumes.

This performance enabled it to take advantage of significant increases in realized coal prices across all markets. Amid shortages of gas supplies in Europe, coal prices peaked at almost $ 240 per tonne in October last year.

This week, the unrest in Eastern Europe has pushed global coal prices to stratospheric levels, with the Newcastle coal price breaking $ 400 per tonne on Thursday.

Exxaro also benefited from its stake in the Sishen Iron Ore Company, which raised nearly R19 billion as a result of high iron ore prices.

The sterling results mask the severe operational problems at Transnet Freight Rail moving Exxaro’s coal to the Richards Bay Coal Terminal.

The impact was a 37-year year-on-year decline in Exxaro’s export volumes. The group said it was continuing with the government and Transnet to address some of these challenges and take advantage of the prevailing high commodity prices.

“Given the challenges we have faced this year, I am very pleased to present these results, which underline not only the resilience of our company through continuous delivery against our strategic priorities, but also the excellence of our people and the ability of our management to take decisive action in a dynamic environment, “said Exxaro CEO Mxolisi Mgojo, who will step down from the top job at the end of July.

The group, he said, will continue to focus on cost competitiveness while rolling out its strategy to maximize the value of its coal assets while decarbonising its operations and rebalancing its long-term portfolio away from fossil fuels.

Major Eskom coal supplier Exxaro declares dividend to ‘fixed’ performance

Source link Major Eskom coal supplier Exxaro declares dividend to ‘fixed’ performance

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