IAMGOLD stops paying shareholders

IAMGOLD (TSE:IMG) won’t be cutting a cheque to shareholders any time soon.

The mid-tier miner announced Wednesday that it is suspending dividend payments until further notice because of the low gold price.

“While our outlook for gold over the long term is optimistic, in light of the current gold price we are suspending the dividend to preserve our balance sheet,” CEO Steve letwin noted in a statement, adding that the company is on target to reduce costs by $100 million this year and will make additional cuts next year.

In its latest third-quarter report, IAMGOLD recorded $52.2 million in dividend payments over those three months. At that time, the company announced that it would be reviewing its dividend policy.

By not paying shareholders, the firm will be able to save some cash and “maintain flexibility,” Letwin said.

Low gold prices have given IAMGOLD a rough ride this year. Although the company produced more gold and recorded higher sales in the third quarter of 2013, the firm still reported a 12% drop in revenue. IAMGOLD’s share price has dropped 64% year-to-date.

After Wednesday’s announcement, the miner lost nearly 6% on the Toronto exchange, trading at just over $4 per share.

IAMGOLD has operating mines in northwest Africa, eastern Canada and one in Suriname and produced 228,000 ounces of gold in the third quarter of 2013.