Key Takeaways:
AngloGold Ashanti (NYSE: AU) will return up to $2 billion to shareholders through a new buyback program and a record dividend after soaring gold prices helped its quarterly earnings more than double.
The gold miner’s earnings before interest, taxes, depreciation, and amortization rose to $2.29 billion, as the average price for an ounce of gold sold increased to $4,863 from $2,874 in the same period last year, the company said in a statement.
The strong performance led to a record quarterly free cash flow of $1.2 billion, a significant increase from $403 million a year ago. This allowed AngloGold Ashanti to announce a share buyback of up to $2 billion and a record interim dividend of $1.16 per share, a substantial increase from the 12.5 cents declared last year. The company has now moved to a net cash position of $868 million, from a net debt of $755 million.
The higher gold prices more than compensated for a near 20% rise in all-in sustaining costs, which stood at $1,955 per ounce. The company backed its full-year guidance, signaling confidence in its operational performance for the remainder of the year. The news sent AngloGold Ashanti’s shares up, joining other mining stocks like Newmont Corporation (NYSE: NEM) and Agnico Eagle Mines Limited (NYSE: AEM) that have also benefited from the elevated gold prices.
This article is for informational purposes only and does not constitute investment advice.
