Cape Lambert to cut A$3.5m in costs, postpones dividend
PERTH (miningweekly.com) – ASX-listed Cape Lambert on Wednesday announced cost-cutting measures to save an estimated A$3.5-million a year, which included letting go 117 staff members.
The company told shareholders that the measures were incorporated following a review of the company’s capital management strategy and projected expenditure, taking note of the recent deteriorating market conditions and the substantial fall in the iron-ore price.
“We have seen a sharp drop in the iron-ore price in recent months, coupled with a downturn in market conditions for the mining sector as a whole,” said executive chairperson Tony Sage.
In addition to the cost-cutting measures, the company has also taken the decision to postpone the second dividend payment to shareholders, which had been scheduled for February 27.
The postponement, Sage said, was a “sound financial decision at an uncertain time” in the iron-ore sector.
“I would like to emphasise that this is a postponement, not a cancellation of the dividend payment,” Sage said.
“Cape Lambert as a company is in a strong commercial position and taking these measures is sound management to protect the company in what is a hard time for the mining sector. However, Cape Lambert is confident that the iron-ore price will recover in the near to medium term, and the dividend payment can resume in due course.”
Cape Lambert was recently granted a mining licence for its Marampa iron-ore project, in Sierra Leone.
The project comprises two granted exploration licences covering about 66 km2 and the project is estimated to host a Joint Ore Reserves Committee-compliant resource of some 681-million tonnes, grading 28.2% iron, of which 262-million tonnes are indicated and 419-million tonnes inferred.
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