TSX falls 14%, March 16-20: Kirkland Lake, Teck, Altius Minerals

The S&P/TSX Composite Index plunged 13.59% (1,864.5 points) to finish the March 16-20 trading week at 11,851.80. The S&P/TSX Global Mining Index fell 3.42% to 57.12, while the S&P/TSX Global Base Metals Index dropped 16.56% to 57.98. Spot gold finished at US$1,498.80 per oz., a US$31.10 per oz. drop or 2.03%.  The S&P/TSX Global Gold Index rose 5.53% to 213.38.

Kirkland Lake Gold climbed $4.81 to $36.75 per share. The company doubled its quarterly dividend to US12.5¢ per common share—a 100% increase from the previous quarterly dividend of US6¢, which was paid on Jan. 13 to shareholders of record on Dec. 31. The payment marks the 12th quarterly dividend payment made to shareholders since Kirkland Lake adopted a dividend policy in March 2017. The company also announced repurchases of 10.1 million common shares at a cost of $470 million (US$350 million). Kirkland Lake forecasts 2020 production of 1.47 to 1.54 million oz. gold.

Vancouver-headquartered diversified miner Teck Resources fell $2.15 to $10.22 per share. The company announced a temporary suspension of construction activities at its Quebrada Blanca Phase 2 (QB2) project to ensure safety and support Chilean efforts to limit transmission of COVID-19. In a statement on March 18 Teck said the suspension will be for an initial two-week period and it will then re-assess the situation. The suspension will affect about 15,000 workers. The project is one of the world’s largest undeveloped copper resources. Teck owns an indirect 60% stake and Sumitomo Metal Mining Company and Sumitomo Corp. together own 30%. A Chilean state agency owns the remaining 10% non-funding interest.

Shares of Altius Minerals were down $1.88 to $6.68. On March 11 the company reported record attributable royalty revenue of $78.1 million or $1.83 per share for calendar 2019, a 16% year-on-year increase. Altius posted adjusted earnings before interest, taxes, amortization and depreciation (EBITDA) of $62.6 million or $1.46 per share for the year, 18% higher than 2018. The company also increased its dividend by 25% during 2019 and repurchased 802,000 shares at a cost of about $9.3 million. Breaking down its portfolio, base metals (copper, nickel, zinc and cobalt) accounted for 37% of its total revenue; potash 21%; iron ore 20%; thermal coal 16%; and metallurgical coal 4%. As of Dec. 31, it held $22 million in cash and had $109 million in debt. For 2020, the company anticipates attributable royalty revenue of $75-$80 million.