The Independence Group (ASX: IOG) share price is up as much as 25% this year on the back of releasing their half-year results to the market in late January.
Independence Group is an exploration and mining company, which owns the Nova nickel-copper-cobalt operation and has a 30% interest in Tropicana Gold Mine
Half-Year Results
In their results, Independence Group reported:
- Revenue unchanged at $356 million (previous year $355 million)
- Underlying EBITDA unchanged at $131 million (previous year $133 million) (click here to learn what EBITDA means)
- Operating cash flows up 46% to $163 million
- Interim dividend of 2 cents per share fully franked.
Nova
The Nova operation reached record production levels in the period as the operation hit maximum output capacity, meeting pro-rata management guidance for FY19 with:
- 14,428t nickel
- 6,501t copper
- 519t cobalt
- A$2.34/lb cash cost
Its cash cost of A$2.34/lb was down 30% from the previous period due to higher production and lower overall costs.
Tropicana
Production for the Tropicana gold mine also met pro-rata management guidance with:
- 262,000 oz of gold produced for the period
- a cash cost of $658/oz, and;
- an All In Sustaining Cost (AISC) of $934.
Strong Financial Position
Independence Group boasts a strong financial position with net cash of $94 million after subtracting its debt.
Investing For A Future In Energy?
The company has an evolving strategy to align the business to the structural shift to energy storage. With its cash flows from the Nova and Tropicana mines, Independence Group is investing in new projects. In the 6 months to 31 December 2018, the company entered five new projects alone, with one of these being a solar energy farm.
Dividends To Increase?
The company flagged a potential increase in dividends soon, with CEO Peter Bradford, saying, “To support our growth, we envisage continuing to strengthen the balance sheet while allocating 15-25% of underlying free cash flow to shareholder returns. Additional funds would be returned to shareholders in the event that future cash on the balance sheet exceeds a defined level with no growth options identified.”
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