McEwen Mining halts payout over “much lower revenue” this quarter

Black Fox gold mine near Timmins, Ontario. (Image courtesy of McEwen Mining.)

McEwen Mining (MUX) was trading 3% lower on Thursday after the Toronto-based company announced suspension of a shareholder payout just a day before the record date.

Chairman Rob McEwen, who owns 23% of the company worth $586 million in New York, said it decided on the freeze because of operating issues at the Black Fox mine in Ontario and with the startup of its Nevada project Gold Bar:

“While viewed as temporary, these issues have resulted in much lower revenue this quarter than planned. As a result, we decided the prudent and responsible course of action was to conserve our cash and suspend the distribution.”

The distribution of ½ cent per share would have been paid on March 15 to shareholders of record on March 8.

McEwen’s gold equivalent output climbed 15% from 152koz in 2017 to 175.6koz last year. 100%-owned Black Fox produced 49koz gold equivalent in 2018.

Commercial production at Gold Bar in Nevada was expected to commence in the final quarter of this year with average 63koz per year over a 7.4-year life.