Ferrexpo pays extra 2020 special interim dividend due to solid results

(Alliance News) - Ferrexpo PLC on Wednesday said it has delivered a "strong" financial ...

Alliance News 17 March, 2021 | 9:35AM
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(Alliance News) - Ferrexpo PLC on Wednesday said it has delivered a "strong" financial performance, alongside healthy shareholder returns through "consistent investment and capital management".

The Baar, Switzerland-based company mines for iron ore pellets in Ukraine.

For 2020, the miner reported revenue of USD1.7 billion, up 13% from USD1.5 billion in 2019, and pretax profit of USD747.9 million, up 63% from USD459.6 million. This reflects rising production volumes and a destocking process in the first half of 2020, it said.

Ferrexpo's 2020 underlying earnings before interest, tax, depreciation and amortisation was USD859 million, rose 46% from USD586 million in 2019. It said its "strong operational performance, delivery of investments and expertise in marketing" have enabled the company to reinvest in its operations to further develop the business.

The miner said 2020 iron ore pellet production was up 7% to 11.2 million tonnes from 10.5 million tonnes in 2019, maintaining its position as the "third largest exporter of iron ore pellets globally".

Ferrexpo said that, in light of its "strong operational and financial performance, coupled with its transition to a net cash position and continued healthy iron ore prices," it has declared a further special interim dividend of 39.6 US cents. This brings total dividends paid for 2020 to 72.6 US cents. It paid a 13.2 US cents special interim dividend back in January.

Ferrexpo said it will consider a final dividend for 2020 as well, which if proposed, will be put to vote at its annual general meeting in May.

Shares in Ferrexpo were down 0.2% at 354.60 pence in London on Wednesday.

"There is no doubt that the year 2020 was one that will be remembered as a difficult time for communities around the world. Through consistent investment and capital management, the group has once again been able to deliver strong financial performance, coupled with shareholder returns. Dividends paid during the 2020 calendar year grew by 26% to USD195 million, after re-investing USD206 million back into operations and USD148 million of debt repayments," said Non-Executive Chair Lucio Genovese.

Looking ahead, the company said the outlook for pellet premiums in 2021 is positive, although continued supply disruption of Brazilian pellet exports is expected.

"Brazilian producers face continued operational issues in the consistent supply of pellet feed, as well as the apparent prioritisation of the domestic steel sector in Brazil. The return of Brazilian pellet producer Samarco is not expected to materially impact the market in 2021, with this operation ramping up towards a reduced level of output compared to previous levels. Global demand for pellets continues to be robust," said Ferrexpo.

By Zoe Wickens; zoewickens@alliancenews.com

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Ferrexpo PLC 322.20 GBX -2.48 -

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