October 25, 2019 / 1:50 PM / 21 days ago

Brazil's Vale CEO says not yet time to resume dividends

A view of a collapsed tailings dam owned by Brazilian mining company Vale SA, in Brumadinho, Brazil February 13, 2019. REUTERS/Washington Alves

SAO PAULO (Reuters) - Vale SA’s (VALE3.SA) chief executive officer said on Friday that a resumption in paying dividends or share buybacks would depend on progress in repairing the damage from its Brumadinho tailings dam collapse, which killed more than 250 people.

Eduardo Bartolomeo told investors on a conference call the Brazilian iron ore miner would be able to resume dividend payments at some point, but that “that moment has yet to arrive”.

Bartolomeo was speaking a day after Vale reported a weaker-than-expected 15% third-quarter earnings gain as the company struggles to restore production lost after regulators demanded that it shut down a series of other dams for safety reasons.

Still, Vale shares were up 2.7% in morning trading, with analysts citing the company’s strong cash flow in the period, which they said cut its debt to an 11-year low.

Also during the conference call, Marcelo Spinelli, Vale’s director of ferrous metals, forecast 2020 growth in global iron ore demand of 2% to 3%, adding that he expects a 1% uptick in Chinese steel production.

Reporting By Christian Plumb and Roberto Samora; editing by David Evans and David Gregorio

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