Polymetal beats FY production forecasts, warns of higher costs

Precious metals miner Polymetal beat full-year production forecasts on Friday but cautioned that costs in the new year would be higher than previously expected as a result of the ongoing Covid-19 pandemic.

Polymetal said full-year gold and silver came to 1.55m ounces of gold equivalent in 2020, a 4% increase and above guidance of 1.5m ounces, while revenues jumped 28% to $2.9bn

The FTSE 100-listed group added that it expects to produce 1.5m ounces of gold equivalent again in 2021, as guided stated, but warned that capital expenditure was on track to be roughly $75m.0m higher year-on-year at $560.0m, with the majority of the increase being recorded as operating costs.

Elsewhere, the Russia and Kazakhstan-focussed miner highlighted that it had successfully reduced the number of fatal accidents among its workforce following three fatalities in 2019, but did note that five staff members had died from Covid-19 since March 2020.

Chief executive Vitaly Nesis said: "2020 was a successful year for Polymetal despite the COVID pandemic. We improved our safety performance and, crucially, achieved zero fatalities. The company beat production guidance, enjoyed record free cash flow and continued to execute development projects on schedule."

As of 0840 GMT, Polymetal shares were down 1.78% at 1,576.0p.