Jubilee Mines NL (ASX: JBM) will reward its shareholders with a 15 cent maiden dividend after announcing a 69.5% increase in net annual profit to $29.56 million. This is the company's second successive year of strong profit growth and outstanding production performance as a nickel producer.
The maiden dividend, combined with the strong profit performance, confirms Jubilee's status as one of Australia's leading mid-sized mining companies.
The increased net profit was struck on a slightly lower gross sales revenue of $120.4 million, compared with $131.1 million for the previous year. Gross operating profit for the project was $65.6 million, compared with $69.1 million previously, demonstrating the continued high operating margins of Jubilee's key asset, the Cosmos Nickel Mine in Western Australia's North Eastern Goldfields. Sales revenue net of hedging was $118.7 million for the year, compared with $110.3 million for the previous year.
The full year bottom line performance was a reflection of increased nickel prices in the second half of the year compared with the first half, and the completion of Jubilee's hedging program.
The net profit was achieved after taking into account amortisation and depreciation of $12.75 million, royalties of $4.8 million, financing costs of $3.7 million and tax of $11.5 million. In addition, the company made a combined hedging and foreign exchange gain of $2.3 million compared with a loss of $20.7 million last year.
The profit result equates to earnings per share (EPS) of 24.3 cents.
The dividend, which is unfranked, will be paid to all shareholders registered at 2 September, 2002, is payable on September 30, 2002, and comes just two years after Jubilee made the transition from explorer to producer.
Jubilee's Managing Director, Kerry Harmanis, said the strong result was a pleasing outcome following a successful year for the company.
"We have had an excellent year, with Cosmos turning in another consistently strong operational performance and continuing to exceed feasibility forecasts," he added.
"Our financial performance for the 2001/2002 year was enhanced by the strong recovery in nickel prices, particularly towards the end of the financial year," Mr Harmanis said. "Now that the company has completed its nickel hedge program, we can benefit fully from improved world nickel prices which are expected to continue during the current financial year."
Mr Harmanis said Jubilee's board was keen to maintain the current level of return to shareholders, but this would obviously depend on nickel prices this financial year.
Jubilee is on track to achieve a smooth transition to underground mining during mid-2003, enabling the Company to maintain annual nickel production in excess of 10,000 tonnes per annum at life-of-mine cash costs of around US49 cents a pound.
OUTLOOK
Mr Harmanis said the outlook for 2002/2003 was encouraging, with Jubilee benefiting from further recovery of world nickel prices.
"With the payment of our maiden dividend in September, a continued intensive exploration effort and the transition to underground mining scheduled for mid-2003, the outlook for Jubilee and its shareholders is very positive," Mr Harmanis added.
Released by: On behalf of: Jan Hope / Nicholas Read Kerry Harmanis Jan Hope & Partners MANAGING DIRECTOR Telephone: (+61-8) 9388-1474 Jubilee Mines NL Telephone: (+61-8) 9213-1588 www.jubileemines.com.au
JBM Price at posting:
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