COMPANY COMMENT: Sibanye dividends set to drop off the radar
Sibanye has set itself a mighty challenge. So, goodbye dividend
It takes a read well past the first page of Sibanye-Stillwater’s interim results to realise that the newly named mining firm is deeply in the red.A surge in the palladium price is certainly helping. If it remains at ruling levels of about $850/oz, the US operation will not only be self-funding, but will boost group cash flow. Similarly, the cost of shuttering the old Cooke and Beatrix gold mines is necessary to ensure that Sibanye’s other, profit-generating assets are not compromised by a drain on cash and management effort. Buyers of Sibanye’s stock are now, more than ever, staking their money on Froneman’s ability to make good on management promises. Finance Minister Malusi Gigaba’s eyeing of the Public Investment Corporation (PIC) as a possible solution to South African Airways’ (SAA’s) financial woes would do nothing to tackle the problem. At best, it will just kick the can down the road. It is generally accepted that the airline industry does not make money (unless, of course, ...
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