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Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (34226)	3/16/2009 9:57:11 PM
From: LoneClone	Read Replies (1) \| Respond to of 193842

Pan African sits in the black Brendan Ryan Posted: Fri, 13 Mar 2009 miningmx.com [miningmx.com] -- AMID the gloom and doom of plunging profits and passed dividends it's refreshing to find a company making good money and rewarding shareholders. Pan African Resources sits well in the black, thanks mainly to a 7,8% jump in gold production from its Barberton Mines in the six months to end-December 2008. Revenues were 71% up due to the higher gold price received, while EBITDA more than doubled because of good cost control at the mine. Pan African is dual-listed on London's AIM and the JSE but does its accounts in British pounds, so headline earnings amounted to £3,9m and an interim dividend of 0,2555p a share was declared. In rand terms, that works out to around 3,8c/ share - a 5,6% yield on the current JSE share price of around 68c. In "real" money terms it's even better, as the dividend works out to a 6,8% yield on the London price of 3,75p/share. Trading liquidity on the JSE is restricted, hence the higher SA share price than should be the case when converting the London price at ruling exchange rates. CEO Jan Nelson stresses he wasn't pressured into paying the dividend by cash-strapped controlling shareholder Metorex. "We still have a good cash war chest after paying the dividend and we're still a growth company. We intend continuing to pay dividends subject to cash flow and the funding requirements for growth projects." The bad news is on the exploration front, where Pan African's projects in the Central African Republic (CAR) aren't living up to expectations, while the company has shut down its exploration activities in Ghana. Nelson says other targets in CAR have still to be assessed but he remains optimistic about its Manica project in Mozambique. Its JSE share price has recovered from a low of 35c to current levels. Nelson was buying the stock himself at around 50c/share in November 2008 - a level he described as "ridiculously low". With the rand gold price staying in record territory above R300 000/kg the Barberton mine should continue to churn profits, making Pan African a buy.