Record dividend: Northern Star Resources (ASX:NST) share price climbs on half-year results

Why did Northern Star declare a record dividend today?

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Key points

  • The Northern Star share price started today's session strongly 
  • Record fully franked dividend of 10 cents per share reflecting 27% of cash earnings 
  • Net profit after tax increased by 43% to $261 million

The Northern Star Resources Ltd (ASX: NST) share price is in the green today following the release of the company's half-year (H1FY22) results.

The gold miner's shares opened strongly, lifting 3.2% above yesterday's close to $8.96 shortly after the open. They are now trading at $8.74, an 0.69% gain.

Let's take a look at what the company reported today.

Northern Star share price up on half-year results

The highlights of Northern Star's half-year (H1FY22) results include:

  • Revenue of $1,807 million, a 63% gain on the previous corresponding period (PCP) of H1FY21
  • Net profit after tax (NPAT) surged 43% on PCP to $261 million
  • $699 million underlying EBITDA, a 47% gain on PCP
  • Cash earnings of $430 million, a 69% increase on PCP

Record dividend declared

Northern Star declared a fully franked interim dividend of 10 cents per share. This is a record for the company and represents a return to shareholders of 27% of its earnings.

The revenue boost was driven by 62% more gold sold compared to the H1FY21. The amount of gold increased from 480 thousand ounces (koz) to 779 koz.

The company sold 477 koz of gold from the Kalgoorlie mine, 212 koz from Yandal, and 90 koz from Pogo at an all-in sustaining cost (AISC) of $1,613 per ounce.

During the half, Northern Star repaid $361 million of corporate bank debt and acquired Newmont's power business for $130 million.

In July, the company confirmed it will aim for net zero emissions by 2050.

Management comment

Northern Star managing director Stuart Tonkin commented:

We remain on track to meet our FY22 production guidance, which incorporates current WA border restrictions and the associated labour and cost impacts.

During this period of continued market volatility, we are focused on operational delivery and proactively protecting the health, safety and wellbeing of our people and those in the communities in which we operate.

What's next for Northern Star?

Northern Star is on track to meet its FY22 full-year guidance. Gold production at the Pogo and Yandal mines is increasing. However, Kalgoorlie production has been impacted by open pit material movement.

On 15 February, the company will release a sustainability report highlighting its emission reduction targets for 2030.

Northern Star share price recap

The Northern Star share price has dived 27% over the past year. For perspective, the S&P/ASX 200 Index (ASX: XJO) has returned nearly 7% over the past year.

Northern Star has a market capitalisation of about $10 billion based on the current share price.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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