Polymetal ups full-year production guidance

Precious metals specialist Polymetal International has upped its guidance for annual gold production after a “steady” third quarter.

The FTSE 250 group, which operates gold and silver mines in Russia, produced 447,000 oz of gold equivalent in the third quarter, down 5% year-on-year. It attributed the decline to large volumes of concentrate produced at its operations in Kyzyl and Mayskoye which are due to be shipped and booked as production in the fourth quarter.

Gold production was 356,000 oz, down 4%, while silver production was 10% lower at 6.7m oz, because of planned grade declines Dukat. Gold equivalent production for the first nine months of year was ahead 4% at 1.07m oz.

Lower metal prices and sales volumes, due to the build up of working capital in the form of concentrate, meant third-quarter revenues were down 16% to $459m. Gold sales volumes totalled 321,000 oz and silver 5.3m oz. Net debt increased to $1.8bn.

Chief executive Vitaly Nesis said: “We quickly and efficiently ramped up Kyzyl to full production. The other assets in our portfolio demonstrated a steady performance which leaves us well placed to outperform our original production guidance.”

The group said it was likely to exceed its full-year guidance of 1.55m oz of gold equivalent by up to 50,000 oz, and reiterated its production guidance of 1.7m oz for 2019 and 1.8m oz for 2020.

Polymetal also announced earlier on Monday it was taking a controlling stake in the Veduga gold project in a $19.7m deal.

Polymetal had to bring forward today’s third-quarter production results, schedule for release on Tuesday, after an analyst inadvertently published a research note early on Monday morning detailing the numbers.