LONDON -- The shares of Randgold Resources (LSE: RRS ) (NASDAQ: GOLD ) have rallied 4% to 6,330 pence late in London trade today after the FTSE 100 miner announced it would lift its annual dividend by 25% to $0.50 per share.
Randgold, which mines gold in Mali, Congo, and the Ivory Coast, said profit during 2012 had improved 16% to $511 million after production advanced 14% to 794,844 ounces. Gold sales during the year gained 17% to $1.3 billion.
The miner also confirmed that its balance sheet carried cash and gold amounting to $403 million at the year-end, even with capital expenditure during 2012 coming to $563 million.
Mark Bristow, Randgold's chief executive, said: "It's been a particularly eventful year, but the team once again rose to the challenges. Not only did we achieve very creditable results for 2012, but we start 2013 in good shape and with a renewed focus on growing our production and managing our costs."
The "eventful year" included frequent power cuts -- and a fire -- at the group's Ivory Coast mine, as well as a military coup in Mali. Still, long-term Randgold investors may not be too worried about last year's challenges. During the last 10 years, investors have seen profit jump sevenfold and the share price -- following various gold discoveries -- soar more than 20-fold.
With a present market cap of 5.6 billion pounds, Randgold is valued at 17 times today's profit figure and yields a tiny 0.5%. Clearly, a lot of Randgold's current valuation is based on the amount of gold the company believes it can mine in the future.
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