Amerigo Resources Ltd. (TSX: ARG; OTCQX: ARREF) declares the Company’s first Performance Dividend.
Highlights
- Performance Dividend of Cdn$0.04 per Share Declared1
- Amerigo’s Capital Return Strategy to Investors Now Fully Deployed
- Annualized Dividend Yield of 10.3%2
“We are very pleased to report that Amerigo has declared its first Performance Dividend of Cdn$0.04 per share. This initial Performance Dividend provides significant, immediate, and additional investment returns to shareholders. It also demonstrates Amerigo’s unique ability to share the benefit of strong copper prices with investors promptly,” said Aurora Davidson, Amerigo’s President and CEO. “With this first Performance Dividend, Amerigo has now deployed all three tools in the Company’s comprehensive Capital Return Strategy3.”
“The strong copper prices we experienced last quarter confirmed our long-standing view on the strength of copper supply and demand fundamentals. The positive impact of these recent copper prices also demonstrated Amerigo’s ability to generate substantial excess cash for shareholders. This is possible because of Amerigo’s excellent operating performance and low debt and capital requirements. This combination is powerfully and predictably generating a strong Return on Invested Capital for the Company and shareholders,” she added.
“In less than a quarter, our cash reserves have reached targeted levels, allowing more than the equivalent of an additional quarterly dividend to be paid to shareholders. Amerigo’s Performance Dividend is a flexible mechanism with regard to timing, frequency and the amount of capital returned to shareholders. We look forward to a strong second half of 2024.”
On July 8, 2024, Amerigo’s Board of Directors declared its first Performance Dividend. The dividend will be in the amount of Cdn$0.04 per share, payable on August 6, 2024, to shareholders of record as of July 16, 20241. Amerigo designates the entire amount of this taxable dividend to be an “eligible dividend” for purposes of the Income Tax Act (Canada), as amended from time to time. Based on Amerigo’s June 30, 2024, share closing price of Cdn$1.55, this Performance Dividend, along with the Company’s quarterly dividends of Cdn$0.03 per share, represents an annual dividend yield of 10.3%2.
Capital Return Strategy
Since implementing its Capital Return Strategy (the “Strategy”) in September 2021, Amerigo has paid cumulative quarterly dividends of Cdn$0.32 per share ($40.5 million) and used $23.7 million to purchase and cancel 20.1 million of its common shares, a 11.1% reduction in the number of common shares outstanding at the inception of the Strategy.
With the declaration of the Company’s first Performance Dividend, the three legs of the Strategy (quarterly dividends, performance dividends, and share buybacks) are now fully deployed. Amerigo’s Performance Dividend is a flexible mechanism with regard to timing, frequency and the amount of capital returned to shareholders. It is ideally suited to return capital to shareholders quickly and is a unique tool to transfer the benefits of solid copper price performance to Amerigo’s shareholders.
¹Dividend Dates
A dividend of Cdn$0.04 per share will be paid on August 6, 2024, to shareholders of record as of July 16, 2024. Under the “T+1 settlement cycle”, the Company’s shares will commence trading on an ex-dividend basis at the opening of trading on July 16, 2024. Shareholders purchasing Amerigo shares on the ex-dividend date or after will not receive this dividend, as it will be paid to selling shareholders. Shareholders purchasing Amerigo shares before the ex-dividend date will receive the dividend.
²Dividend Dates
The disclosed annual yield of 10.3% is based on the Performance Dividend of Cdn$0.04 per share disclosed in this news release and the four quarterly dividends of Cdn$0.03 per share each, divided over Amerigo’s June 30, 2024 closing share price of Cdn$1.55.
³Capital return to shareholders
The table below summarizes the capital returned to shareholders as of this news release since Amerigo’s Capital Return Strategy was implemented in October 2021.
About Amerigo and MVC
Amerigo Resources Ltd. is an innovative copper producer with a long-term relationship with Corporación Nacional del Cobre de Chile (“Codelco”), the world’s largest copper producer.
Amerigo produces copper concentrate and molybdenum concentrate as a by-product at the MVC operation in Chile by processing fresh and historic tailings from Codelco’s El Teniente mine, the world’s largest underground copper mine. Tel: (604) 681-2802; Web: www.amerigoresources.com; Listing: ARG: TSX.
Amerigo Resources is a market awareness client of Capital 10X. For more information, including potential conflicts of interest please see our Content Disclaimer.
