Prospect Resources pays out 95% dividend yield following lithium asset sale
Prospect Resources now has an outsized cash position of $34m compared to a market cap of $33.7m
Source: iStock
Mentioned
KEY POINTS
- Prospect Resources sold its flagship Arcadia Lithium Project for US$343m cash in April
- Most of the proceeds were returned to shareholders in the form of a 96 cent dividend/capital return
- Prospect will remain a lithium explorer, focusing on the Step Aside Project in Zimbabwe
Prospect Resources (ASX: PSC) has pressed the ‘reset’ button, returning a massive 96 cents per share dividend to investors after the sale of its flagship Arcadia Lithium Project in Zimbabwe.
Arcadia was sold to the company’s Chinese partner, Zhejiang Huayou Cobalt in April for US$343m cash. Most of the asset sale proceeds were returned to shareholders and reflected in the -93% decline in share price on Wednesday.
Prospect 2.0
The sale of Arcadia turns a new leaf for Prospect, now focused on another highly prospective Zimbabwe-based asset, the Step Aside Project.
Step Aside is located 8km north of the Arcadia Project, with claims covering approximately 100 hectares. Historical exploration in the area has been encouraging, with positive regional soil sample geochemistry results.
Historical exploration has returned positive stream and soil sample geochemistry results, and four mineralisation lithium pegmatites have been mapped from east to west.
An RC drilling program commenced in early June and expected to be complete within 4 weeks, with assay results expected in August.
Outsized cash balance
Prospect has a cash balance of $34m post distribution to progress the Step Aside project and secondary focus on battery metal projects in the broader sub-Saharan African region.
This means that the company is trading around cash, given its current market cap of around $33.7m.
Prospect Resources share price chart
