Sibanye Gold won't pay dividend for first time as it posts loss

Johannesburg - Sibanye Gold [JSE:SGL] said it won’t pay an interim dividend for the first time since it began trading in 2013 as the biggest producer of South African gold reported a first-half loss.

The results in the six months through June were affected by a big impairment charge on unprofitable mines it plans to close, provision for a settlement in a lung-disease class-action lawsuit and financing costs following its $2.2bn purchase of US platinum-group metals producer Stillwater Mining.

READ: Mines make room for silicosis settlements

Sibanye’s net debt following the Stillwater deal rose to $1.69bn at the end of June. The company is emphasising cash preservation and the payment of a dividend is “inappropriate until leverage is reduced,” it said in a statement on Wednesday.

Paying a dividend has been a core part of Sibanye’s strategy since it was spun off from Gold Fields [JSE:GFI].

While its South African mines are high-cost and aging, they are proven cash generators that formed the basis of the company’s regular shareholder payouts until now.

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter:

ZAR/USD
16.68
(+1.45)
ZAR/GBP
21.56
(+0.98)
ZAR/EUR
19.56
(+1.56)
ZAR/AUD
11.95
(+1.17)
ZAR/JPY
0.16
(+1.35)
Gold
1895.79
(-0.05)
Silver
23.78
(-1.85)
Platinum
898.00
(+1.81)
Brent Crude
41.31
(-3.06)
Palladium
2318.00
(+0.78)
All Share
54264.96
(-0.44)
Top 40
50042.44
(-0.55)
Financial 15
10071.85
(+0.68)
Industrial 25
73187.40
(-0.23)
Resource 10
53383.39
(-1.24)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 1396 votes
It depends on how the funds are used.
73% - 9032 votes
No. We should have gotten the loan elsewhere.
16% - 1992 votes
Vote