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Centerra shares up on dividend, strong results Add to ...

Shares of Centerra Gold rose more than 8 per cent on Monday, after the company reported better-than-expected first-quarter results and boosted its dividend.

The mid-tier gold producer said late on Friday that it would pay a special dividend of 30 cents (Canadian) a share, and also increased its annual dividend from 6 cents to 10 cents a share.

Shares of Centerra were up 8.41 per cent at $19.08 on Monday afternoon on the Toronto Stock Exchange.

"They beat expectations, but they also announced a special dividend of 30 cents Canadian per share," said RBC analyst Haytham Hodaly.

"Their dividend this year, so far, is going to be 40 cents a share, which is just over a 2-per-cent yield," he added. "That is one of the highest yields in the precious metals industry."

The special dividend will be paid on May 18.

Centerra also posted a 10-per-cent rise in its first-quarter profit, helped by higher gold prices.

While production was lower than in the previous year, the Toronto-based company beat most analysts' production estimates for the quarter. Centerra maintained full-year estimates of 600,000 to 650,000 ounces of gold.

The miner is expected to increase production to around 850,000 ounces a year by 2014.

"There's some decent growth in the pipeline, assuming everything works out how it is supposed to," Mr. Hodaly said.

Some of that growth depends on Centerra obtaining a final operating permit for its project at the Boroo mine in Mongolia, along with the development of the nearby Gatsuurt project, which has been delayed by an environmental law.

Centerra also owns the Kumtor mine in Kyrgyzstan, where it plans to spend $13-million (U.S.) this year on exploration.

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  • Centerra Gold Inc
  • Updated January 17 11:03 AM EST. Delayed by at least 15 minutes.

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