dürfte auch davon abhängen, ob und inwieweit Thungela mit seinen M&A-Plänen vorankommt und umsetzen kann.
Earnings-Call Transcript vom 15.08.2022
seekingalpha.com/article/...-results-earnings-call-transcript
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Operator
Thank you very much, July. And now going back to the dividend that was declared, our policy is 30%, minimum of 30% of adjusted operating cash flow, we have exceeded that twice in a row. Now, have we set a precedent that this is how we will continue in the future?
Deon Smith
It's a very good question, and clearly one that's quite topical, not only for whoever asked the question, but for our shareholders also. And the answer is no, we haven't set a president. Our dividend policy is to return 30%, but in particular a minimum of 30% of our adjusted operating free cash flow to shareholders. But let me unpack that a bit more and give you a bit of context as to how we got to 92% and how we got to 63% in our first dividend, the ZAR18 that July spoke of, or the 2.8 billion in March.
The board resolved that we need a level off cash liquidity in our balance sheet after we've paid dividends. July said earlier, we had close to ZAR15 billion in cash on our balance sheet at the end of June. And similarly, we had around ZAR8.7 billion of cash on our balance sheet at the end of December last year. If you calculate those quantums of dividends we've paid, you would see that we paid down as well as allocated to the community and employee programs and then the Green Fund down to a level that we retained cash, that retention is about ZAR6 billion.
So in theory, if that dividend were to have been paid on the July 1, so immediately after the six month reporting period and we made all the payments on that same day, we would still be left with ZAR6 billion. We've also consistently said to our shareholders, we run at earn it first principle, which means that yes, by the time that we pay our dividend, we might have earned some more money and that balance might be above the ZAR6 billion or materially above the ZAR6 billion after funding the dividend. But we want to earn it first then assess all of our capital allocation opportunities and after that return excess cash, which is important, and therefore the 92% is excess cash and the 63% was excess cash. So is there a scenario that we might not return 90% or 60%? The answer is absolutely yes.
We continue to look at a number of M&A opportunities. We've looked at these across the globe in the last nine months, and we continue to scratch hard at those options. Clearly, if we find something that we think is value accretive and would grow Thungela in the appropriate way and sustain the business as well as show returns for the long run, we would absolutely consider acquiring such an asset. If that's the case, we might want to use some of that cash as firepower to acquire a business or a mine, something that's sought, in which case that percentage might be lower. But we've remained committed that it would not be lower than 30% of our free cash flow in the period.
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