Shareholders in Northern Star Resources Ltd (ASX: NST) had lots to smile about this morning after the gold miner declared a record dividend payout on the back of higher gold prices and sales in 1H FY25.
The miner delivered 1H FY25 cash earnings of $1,146 million, up 63% on the previous period, recording underlying earnings for a second consecutive period.
Currently vying to takeover De Grey Mining (ASX: DEG) for $5bn, Northern Star sold 804,000 ounces of gold in the first half to 31 December at an all-in cost of A$2,105/oz.
Northern Star Managing Director Stuart Tonkin said the miner is well positioned to achieve FY25 production and cost guidance while also focusing on progressing key growth plans, including the KCGM Mill Expansion Project which remains on time and within budget.
"This interim result again demonstrates the strength and value-creation that we are embedding in our business. EBITDA and ROCE metrics continue to improve while the balance sheet remains strong and in a net cash position,” said Tonkin.
“We continue to pursue exploration success at existing operations, while advancing our recommended offer to acquire De Grey Mining."
In the half-year under review, Northern Star also advanced key components of its low-risk, five-year profitable growth pathway.
Other key numbers today included
Cash earnings were $1,15 billion, up 63% from the previous period.
Underlying earnings were $1.4 billion, up 58%.
Record 25 cents per share dividend, up 67%.
Cash bullion at the end of 1H FY25 closed at $1.2 billion.
$300 million on-market share buy-back program 86% completed.
Net cash of $265 million.
Revenue of $2,869 million increased 28%.
De Grey heralds new growth phase
Meanwhile, Northern Star’s acquisition of De Grey marks a new phase of growth for the miner.
Under the terms of the all-scrip acquisition, each De Grey shareholder will receive 0.119 new Northern Star shares, implying a value of $2.08/sh for each De Grey share held.
It’s understood that the Hemi and the surrounding deposits within De Grey’s Mallina project in the Pilbara have grown to a resource of 13.6 million ounces of gold at 1.4 grams per tonne, making it Australia’s largest gold discovery so far this century.
Northern Star has a market cap of $20bn making it the 31st largest stock on the ASX; the share price is up 42% in one year and up 18% year to date.
The stock is in a strong bullish trend confirmed by multiple indicators. Specifically, a 5-day moving average of the stock price is above the 50-day moving average.
Consensus on the stock is Moderate Buy.
This article does not constitute financial product advice. You should consider independent advice before making financial decisions.
