(Adds CEO comment, shares)
JOHANNESBURG Feb 14 South Africa's Kumba Iron
Ore Ltd has made resuming dividend payouts a priority
for 2017 after higher metal prices helped the Anglo American
unit boost profit more than two-fold last year.
Africa's biggest producer of iron ore, used in steel-making,
is one of the assets Anglo is considering jettisoning as part of
a sweeping overhaul.
Kumba suspended dividends in mid-2015 after the price of
iron ore fell to its lowest level in a decade.
But a recovery in the metal price, which topped $90 a tonne
for the first time since 2014 this week, has lifted Kumba and
raised the prospect of a dividend payout in 2017.
"Reinstating the dividend is a priority in 2017," Chief
Executive Themba Mkhwanazi said at a results presentation.
But Kumba said no dividend would be paid for 2016 in the
face of price volatility and the Anglo portfolio review, despite
an impressive turnaround on its balance sheet from a net debt
last year of 4.6 billion rand ($350 million) to a cash balance
of 6.2 billion rand.
"We would need stability around the iron ore prices,"
Mkhwanazi told Reuters when asked what was needed to reinstate
Kumba, 70 percent-owned by Anglo, reported a 131 percent
jump in headline earnings per share in the year to the end of
December but disappointed investors who had been expecting a
strong performance to lead to dividend payouts.
Its share price was down 6 percent to 212.05 rand.
The company's performance last year was boosted by higher
prices and restructuring which included lay-offs and reducing
the amount of waste mined.
($1 = 13.1076 rand)
(Reporting by Ed Stoddard; Editing by Tiisetso Motsoeneng and