11/09/2011 06:41 EST | Updated 01/09/2012 05:12 EST

Silver Wheaton Corp. revenue doubles in the third quarter

Silver Wheaton Corp. (TSX:SLW) nearly doubled its quarterly profits and tripled its dividend Wednesday under a new plan to link its payments to shareholders to the Vancouver company's performance.

The dividend increase is the latest by a mining company riding near record prices for gold and silver in recent months, driven by the economic uncertainty in Europe and the United States.

"We are pleased to establish a unique and sustainable dividend policy that allows our shareholders to further benefit from increasing silver prices, as well as Silver Wheaton's sector leading production growth profile," d Randy Smallwood, president and CEO, told a conference call after the earnings report.

Smallwood said the company had delayed raising its dividend to allow it to build up enough cash to easily do deals and allow for Goldcorp's Penasquito mine in Mexico from which Silver Wheaton receives silver, to ramp up to full production.

Under the Silver Wheaton dividend plan, the company will make a quarterly payment equal to 20 per cent of its operating cash flow in the previous quarter.

Smallwood said the scheme will allow shareholders to benefit from increases in the price of silver as the company's costs are mostly fixed.

"With continued strong silver prices, this results in a significant growth in our operating cash flows and therefore continued growth in our dividends," he said.

"It also provides the company with the cash it requires to continue creating long-term shareholder value by acquiring new high-quality and accretive silver streams."

Before markets opened Wednesday, the company said it will pay a fourth-quarter dividend of nine cents per share, up from three cents the previous quarter.

The Silver Wheaton dividend increase follows increases by gold miners Barrick Gold, Newmont Mining, Yamana Gold and Semafo.

Chinese silver miner Silvercorp also increased its quarterly dividend early Wednesday by half a cent to 2.5 cents per share after it reported increased profits and revenue.

Silvercorp, which keeps its books in U.S. dollars, earned US$18.5 million, or 11 cents a share, on $62.1 million in revenue in the quarter ended Sept. 30. That was up from $12.4 million, or eight cents, or $36.3 million a year earlier.

Silver production rose to 1.4 million ounces, a four per cent increase from 1.3 million ounces a year ago at the company which was had faced allegations of fraud but recently cleared by a forensic auditor's report.

Silver Wheaton reported a third-quarter profit of US$135 million or 38 cents per share for the summer quarter ended Sept. 30. That compared with a profit of $23.7 million or seven cents per share a year ago.

Revenue increased to US$185.2 million from $92.8 million on sales of 4.8 million ounces of silver and 6,300 ounces of gold.

Meanwhile, operating cash flows more than doubled to US$167.2 million compared with $70.5 million.

Silver Wheaton receives silver production from mines around the world, including Goldcorp's Penasquito mine and Barrick's Pascua-Lama project in South America.

In trading on the Toronto Stock Exchange on Wednesday, Silver Wheaton shares were down 59 cents at $36.21.