StockMarketWire.com - Mineral sands producer Kenmare Resources posted a 30% decline in first-half profit amid lower grades and downgraded its annual output guidance citing disruptions from the Covid-19 crisis.

Kenmore cut its interim dividend to 2.31c per share, down from 2.66c on-year.

Pre-tax profit for the six months through June slipped to $16.0m, down from $22.8m, as revenue reversed 5% to $116.8m.

Annual ilmenite production was now expected at between 700k and 800k tonnes, back from previous guidance of between 800k and 900k tonnes.

The company also trimmed its output guidance for zircon, rutile and concentrates.

Kenmare said it expected to mine higher grades in the second half.

'Our performance during the first half of 2020 demonstrated Kenmare's resilience and agility, effectively managing many challenges posed by the Covid-19 pandemic to continue to produce and ship our products safely,' chief executive Michael Carvill said.

'Although production was weaker in the first half than in the corresponding period last year, our business remained profitable and I am pleased to announce an interim dividend of 2.31c per share.'

'This represents 20% of profit after tax, in line with our dividend policy.'

'Market conditions for titanium feedstocks continued to strengthen in the first half 2020, driving a 28% increase in received ilmenite prices, to $217 per tonne, compared to last year.'

'We have agreements for the majority of our second-half ilmenite production, although market conditions are expected to become more subdued in the second half of the year.'


At 2:16pm: [LON:KMR] Kenmare Resources PLC share price was +4.5p at 212.5p



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