Yamana’s stock hits three-year high on strong 2019 results

Cerro Moro gold-silver mine in Argentina. (Image courtesy of Yamana Gold)

Precious metals miner Yamana Gold’s (TSX:YRI; NYSE:AUY) stock reached a three-year high of $4.31 a share on Friday following the release of its fourth quarter and full year 2019 results.

Annual gold production was 900,339 ounces, while silver production reached 10.6 million ounces, both exceeding the company’s 2019 guidance. Output in the fourth quarter was 221,595 ounces and 2.97 million ounces for gold and silver respectively, in line with the plan.

The gold producer also had a strong year for cash flow growth, with cash flow from operating activities increasing by 29% to $521.8 million and free cash flow rising by 63% to $219.8 million.

The gold miner has now increased its yearly dividend cumulatively by 150%

In the fourth quarter alone, cash flow from operating activities exceeded the average of the three preceding quarters by 91%.

Yamana also managed to nearly halve its net debt in 2019, significantly strengthening its balance sheet and financial flexibility.

For the full year, net income totalled $225.6 million compared with a loss of $297.7 million in the previous year. Fourth quarter net earnings came to $14.6 million, from a loss of $61.4 million a year earlier.

“Our operations executed extremely well, with Jacobina posting record fourth quarter and full-year production and El Peñón enjoying its strongest quarter since we rightsized the operation three years ago,” CEO Daniel Racine said in the press release.

“Minera Florida also performed well, particularly in the month of December, something we believe is a sign of things to come. We are carrying this momentum into 2020 using our improved financial flexibility to further reduce debt, advance our organic growth projects and exploration program, and continue to increase shareholder returns.”

Owing to its strong operational and financial results throughout the year, the company has rewarded shareholders with its first quarterly dividend of $0.0125 a share, in line with its previously announced 25% increase to the company’s yearly dividend.

The gold miner has now increased its yearly dividend cumulatively by 150% to $0.05 a share, from $0.02 a share in the second quarter of last year.

The company’s current market capitalization stands at $3.94 billion.

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