Zinifex CEO, Greig Gailey, is going early and going out in style as the company's shares responded positively to a presentation made at an investment conference yesterday.
The shares rose 29c to end at $18.88, not far away from its all time high of $19.08.
That's a considerable gain on the $1.80 float price in April,2004.
Mr Gailey's earlier than expected departure was revealed in the briefing and in a separate statement to the ASX.
He goes a week this Friday, June 29, at the end of the financial year.
What will be interesting will be how the company performed in the 2007 financial year after reporting net earnings of around $1.07 billion for the 2006 financial year.
Zinifex says the search for a replacement is continuing but in the meantime the company's chief financial officer, Tony Barnes, will be acting CEO.
Zinifex revealed in April that Mr Gailey would be leaving later in 2007, at a time suitable to both parties.
He decided to go after Zinifex signed a deal to combine and separately list its smelter assets with Belgian metals group Umicore. That is heading for fruition later this year.
The briefing document yesterday suggested the float could happen from October onwards.
Mr Barnes has been Zinifex CFO since the company listed in 2004, and has also worked at BHP Billiton for 32 years. Group manager corporate accounting, Mike Myers, will fill in for Mr Barnes as CFO.
Former senior BHP Billiton executive, Chris Lynch, has been suggested as a likely new CEO.
Zinifex said that when he leaves on June 29, Mr Gailey will receive a payment of $1.5 million for achieving 2007 financial year short term performance targets and an ex gratia payment of $12.6 million.
He will also get his statutory entitlements as well as $900,000, equal to about 50 per cent of the termination benefit under his employment contract.
"All Mr Gailey's unvested entitlements under the long term incentive opportunity program, currently valued at approximately $14,910,000, will lapse on termination," Zinifex said in the statement to the ASX.
That largesse was criticised by corporate governance types, but ZFX shareholders wouldn't begrudge him his money.
He has been CEO since the company was born from the ashes of the Pasminco failure about four years ago.
Some might argue that the outstanding performance for ZFX has been as much due to the boom in world prices for silver, lead and especially zinc, but a miner and processor needs to be in position to exploit these strong prices. And Zinifex was, whereas Pasminco would not have been because of the crippling burden of its hedge book.
In the briefing to the investment conference yesterday ZFX said its final quarter's production was expected to exceed that of the March quarter:
"Supplies of lead concentrate to Port Pirie have resumed, improving sinter quality and blast furnace rates.
"Budel's Q4 output will be lower as both roasters have been taken offline to repair cooling systems that have been heat damaged by high carbon Century concentrates.
"Century lead grades will remain lower than last year;Century concentrate sales will increase to partially catch up sales deferred in the March quarter due to the MV Wunma sustaining cyclone damage," the company reported.
There was yet another warning on the impact of rising costs: "Cost pressures will remain while commodity prices are high and labour and capacity constraints continue. Century mine's mining costs and amortisation will rise."
But like the past two years,world prices are being helped by low stocks with London metal Exchange zinc stocks now less than 80,000 tonnes – historically a very low level.
"Zinc supply is increasing but this is necessary to avoid an unsustainable situation and demand destruction.Low zinc stocks and strong demand are expected to keep prices buoyant.
"Production issues at several mines have pushed the lead market back into deficit.Lead stocks have fallen to critical levels pushing prices higher and supply issues are expected to continue keeping prices high."
World lead prices touched a new all time high on the LME overnight.
The metal hit$US2,420 a tonne before easing back to $2,400 a tonne.
