Polymetal adjusted earnings rise as Kyzyl mine ramps up

Higher production helped Polymetal report a strong rise in interim adjusted core earnings as its Kyzyl mine in Kazakhstan delivered at full capacity.

Adjusted earnings earnings before interest, tax, depreciation and amortisation rose 34% $403m on gold equivalent production growth of 22%.

Gold sales were 604,000 oz, up 36% year-on-year, while silver sales were down 15% to 10.3m oz, in line with production volume dynamics, Polymetal said on Tuesday.

Net earnings fell were to $153m from $175m a year earlier, most impacted a foreign exchange loss on US dollar-denominated intercompany loans, while underlying net earnings increased 21% to $188m on the back of higher operating profit.

Polymetal said it was still on track to meet its 2019 production guidance of 1.55m ounces of gold equivalent. Total cash costs and all-in sustainable costs were expected to be within guidance range of $600 - $650 and $800 - $850 per gold equivalent ounces, respectively.

An interim dividend of $0.20 a share was declared, up from $0.17 a share last year.

Group chief executive Vitaly Nesis said the company traditionally expected seasonally lower costs, higher production and materially stronger cash flow generation in the second half of the year, “allowing us to meet our full year cost and production guidance".