METS

Mining contractor pauses dividend to maintain liquidity

Big Australian contract miner NRW Holdings has become the latest company to press pause on its planned dividend payment on April 15, with the board to review its options in August.

Staff reporter
NRW Holdings continues to work during the COVID-19 pandemic

NRW Holdings continues to work during the COVID-19 pandemic

The company, which recently had to ensure the market it had no ticking debt time bomb lurking in its accounts, said the decision was made to maximise its liquidity in the uncertain age of COVID-19.
 
The dividend pause was considered a prudent measure, and follows other companies in the mining contracting space including Perenti Global, Downer EDI, Lycopodium and Austin Engineering. 
 
Managing director Jules Pemberton, who recently sold almost A$5 million in NRW shares to fund tax liabilities linked to his long term incentive plan, stressed the company was operating in line with its internal forecasts, and remained confident of its ability to continue to operate.
 
Pemberton again stressed that cashflows "have been entirely consistent with our business forecasts for the first quarter of 2020", and given the Australian federal government had designated the mining sector an essential service, NRW had a degree of certainty its activities would remain necessary.
 
NRW expects revenue to be between $1.5-2 billion for the full year. It is yet to withdraw its guidance.
 
While the company was being forced to make some operational changes due to travel restrictions, it believed it could minimise disruption to current client requirements.
 
NRW was also setting up a facility south of Perth to train new entrants to the mining industry on a range of mobile mining equipment, and it hopes to employ graduates to mitigate modified rosters.
 
More experienced operators would be able to gain certification on unfamiliar equipment.
 
The company hit a year low of A$1 recently, having started 2020 at $3.20, and its shares were trading at $1.33 yesterday.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

editions

Mining Journal Intelligence Investor Sentiment Report 2024

Survey revealing the plans, priorities, and preferences of 120+ mining investors and their expectations for the sector in 2024.

editions

Mining Journal Intelligence Mining Equities Report 2023

Access an exclusive, inside look on the quarterly mining IPOs and secondary raisings data and mining equities performance tables with an annual Stock Exchange Comparisons supplement.

editions

Mining Journal Intelligence World Risk Report 2023 (feat. MineHutte ratings)

A detailed analysis of mining investment risks across 121 jurisdictions globally, built on 11 ‘hard risk’ metrics and an industrywide survey.

editions

Mining Journal Intelligence Global Leadership Report 2023: Social licence

Gain insights into social licence trends and best practices from interviews with 20+ top mining company executives and an industrywide survey.