* 'Worst is behind us' - Vale statement
* Q2 profit rockets to $955 mln amid iron ore price bonanza
* Shares close at record high before payout, profit
July 29 (Reuters) - Brazilian mining giant Vale SA
said on Wednesday it will resume dividend payments to
shareholders, suspended since a deadly dam burst in January
2019, as it reported second-quarter profit rocketed amid a surge
in iron ore prices.
Disclosing the resumption in a securities filing, Vale said
the decision came following the reduction of business
uncertainties related to the novel coronavirus pandemic. "The
worst is likely behind us," Vale said in a statement.
The dividend news, released after the close of share trading
in Sao Paulo, was awaited by investors and analysts and may
stoke market interest in the shares. But it may also bring fresh
scrutiny from critics and victims' groups who blame the firm for
the Brumadinho dam failure, which killed 270 people.
Vale shares closed 4.3% higher, at a historical high of
Announced in a separate filing, Vale's second-quarter net
profit came in at $995 million, more than four times higher than
$239 million the previous quarter, aided by higher iron ore
prices and a devaluation of the Brazilian real currency. Vale
posted losses of $133 million in second-quarter 2019 as it shut
down mines due to security concerns following the dam collapse.
The result fell short of a Refinitiv estimate of $1.51
billion. The company said it was recognizing a liability of $500
million, related to the sale of its mine on the Pacific island
of New Caledonia.
Iron ore prices rose during the pandemic, unlike other
commodities such as oil, amid a global supply shortage.
Demand for the key steelmaking ingredient has remained
resilient as China ramps up infrastructure spending to combat
the economic shock from the COVID-19 crisis.
Vale's board also approved on Wednesday an interest on
equity payment of 1.41 reais ($0.27) per share, to be paid on
($1 = 5.17 reais)
(Reporting by Gram Slattery and Sabrina Valle; Additional
reporting by Roberto Samora; Editing by Sandra Maler and Grant