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Mining industry

Newmont Mining Corporation Enhances Gold Price-Linked Dividend Policy

Strategic Insights

— 2 min read

Newmont Mining Corporation has announced an enhancement to its industry-leading gold price-linked dividend policy, initially launched in April 2011. The updated policy, set to take effect in the fourth quarter of 2011, enables the company to increase its annual dividend to $4.70 per share if its average realized gold price reaches $2,500 per ounce. This policy adjustment provides an additional step-up in quarterly dividends, with a 7.5-cent increase per share when the realized gold price exceeds $1,700 per ounce and a further step-up of 2.5 cents per share (totaling 10 cents) when the price surpasses $2,000 per ounce. At lower gold prices, the existing policy remains unchanged.

Key Takeaways:

  • Newmont Mining Corporation has enhanced its gold price-linked dividend policy, initially launched in April 2011, to provide increased annual dividend potential of up to $4.70 per share at an average realized gold price of $2,500 per ounce.
  • The updated policy includes an additional step-up of 7.5 cents per share in quarterly dividends when the company's realized gold price for a quarter exceeds $1,700 per ounce and a further step-up of 2.5 cents per share when the price exceeds $2,000 per ounce.
  • The enhanced policy will provide an additional $0.10 in quarterly dividend per share when gold prices reach $2,000 per ounce, in addition to the existing policy.
  • The updated policy takes effect in the fourth quarter of 2011, with the first quarterly dividend payable on December 30, 2011, to shareholders of record on December 8, 2011.
  • The dividend payments will be based on the company's average realized gold price for the third quarter of 2011.
  • Richard O'Brien, President, and Chief Executive Officer of Newmont Mining Corporation commented that the company's cash flow and balance sheet strength in the current metal price environment enable it to fund internal growth and return meaningful cash to shareholders.

Statistics:

  • Average realized gold price: $2,500 per ounce for an annual dividend of $4.70 per share.
  • Quarterly dividend increase at $1,700 per ounce: 7.5 cents per share.
  • Quarterly dividend increase at $2,000 per ounce: 2.5 cents per share (totaling 10 cents).
  • Quarterly dividend payment date: December 30, 2011.
  • Record date for shareholders: December 8, 2011.
  • Gold price for a step-up at $1,700 per ounce: 7.5 cents.
  • Gold price for a step-up at $2,000 per ounce: 2.5 cents.

Sources:

  • Newmont Mining Corporation. (2011, September 19). Newmont Mining Corporation Issues Enhancements to Its Industry Leading Gold Price-Linked Dividend Policy. Contify.com.

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