16 October 2017
Polymetal International plc (LSE, MOEX: POLY; ADR: AUCOY) (together with its subsidiaries – “Polymetal”, the “Company”, or the “Group”) is pleased to report the Group’s production results for the third quarter and nine months ended September 30, 2017.
- In Q3 2017, Polymetal achieved a record production of 470 Koz of gold equivalent (GE), which represents a 26% increase over the previous year. The increase was driven by strong contributions from the fully ramped up Svetloye heap leach operation (Okhotsk hub) and Mayskoye oxide ore processing. Albazino and Varvara also achieved record quarterly production levels.
- In the first nine months of 2017, the Company produced 1,028 Koz of GE, a 15% increase over the previous year and in line with the FY2017 production plan of 1.4 Moz of GE.
- Q3 gold output increased 38% year-on-year to 370 Koz. Silver production declined 7% year-on-year to 7.4 Moz due to the planned grade decline at the Dukat underground mine.
- Q3 sales amounted to US$ 546 million, up 17% over the previous year as gold sales jumped 50% on the back of higher output and prices. The timing gap between silver production and sales is expected to be fully closed in Q4 2017.
- At Kyzyl, construction is progressing on schedule. During the quarter, all major processing equipment has been installed with external electrical infrastructure now fully operational. Construction activities are now focused on finalising the tailings storage facility. The project remains on track to produce its first concentrate in Q3 2018.
- During the quarter, the Company generated free cash flow which was used to pay US$ 60 million in interim dividends (US$ 0.14 per share) and a US$ 20 million consideration for a stake increase in the Nezhda gold property. The Company will continue to generate free cash flow in the fourth quarter. Net debt increased marginally from US$ 1,583 million as of June 30 to US$ 1,599 million as of September 30, 2017.
- The Company is on track to meet its FY2017 production guidance of 1.4 Moz of GE at TCC of US$ 600-650/GE oz and AISC of US$ 775-825/GE oz. Cost guidance remains contingent on the Rouble/Dollar exchange rate dynamic that has a significant effect on the Group’s Rouble-denominated operating costs.
- Polymetal re-confirms its production guidance for FY2018 at 1.55 Moz of GE and for FY2019 at 1.7 Moz of GE.
- Polymetal will be hosting an Analyst and Investor Day on November 13 in London to provide an update on key development projects.
“Our operational performance in the third quarter was very robust and the Company remains on track to meet its annual production and cost guidance”, said Vitaly Nesis, Group CEO of Polymetal, commenting on the results. “Meanwhile, Kyzyl continues to advance towards first concentrate production in less than a year’s time”.
CONFERENCE CALL AND WEBCAST
Polymetal will hold a conference call and webcast on Monday, October 16, 2017 at 13:00 London time (15:00 Moscow time).
To participate in the call, please dial:
8 10 800 204 140 11 access code 33335091# (free from Russia), or
+44 20 3367 9461 (free from the UK), or
1 855 402 7761 (free from the US), or
follow the link: http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=4995.
Please be prepared to introduce yourself to the moderator or register.
Webcast replay will be available on Polymetal’s website (www.polymetalinternational.com) and at http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=4995. A recording of the call will be available immediately after the call at +44 20 3367 9460 (from within the UK), 1 877 642 3018 (USA Toll Free) and +7 495 745 79 48 (from within Russia), access code 311079#, from 15:00 Moscow time Monday, October 16, till 15:00 Moscow time Monday, October 23, 2017.