This Aussie miner will pay shareholders in gold
Shareholders in Australian junior Resolute Mining (ASX:RSG) will now have the option of collecting dividend payments in gold, under a new policy announced Tuesday, which is believed to be a world first.
The gold miner, which has nine operations across Australia and Africa, said it would still offer shareholders the option to choose cash instead. The new sales-linked dividend strategy, however, will allow shareholders to pick up the company’s latest 1.7 cent a share dividend payout in bullion.
To be eligible, shareholders need to hold 5,000 or more shares in Resolute Mining and have an account with the Perth Mint.
Here is the catch: To complete the deal, shareholders need to hold 5,000 or more shares in the company and have an account with the Perth Mint so bullion can be deposited directly into their accounts.
Resolute chief executive officer John Welborn said its company’s strong performance, including a record 2016 profit of A$213 million, has allowed the adoption of this exclusive dividend policy.
He also said he expected the bullion option to appeal mainly to retail shareholders, adding that it would be interested to see whether institutions also proved keen to accumulate a direct holding in gold.
Resolute will pay out a total of A$11.1 million in dividends, which amounts to 2 percent of the gold miner's fiscal 2016 gold sales revenue of A$555 million. As of June 30, 2016, the junior had A$102 million in cash and bullion.
Shares in the company closed 6.8% higher in Sydney to A$1.88 on the news. So far this year, the company’s stock has gained 656%.