Sign up USA
Proactive Investors - Run By Investors For Investors

Polymetal warns of write-downs despite production record

Polymetal warns of write-downs despite production record

Polymetal (LON:POLY) hit a production record in its latest quarter, but cautioned weak gold and silver prices will mean up to US$340mln of impairment charges.

The Russian miner produced 323,000oz of gold equivalent in the three months to June, a 37% increase on the previous quarter and 9% better year-on-year.

Strong performances from the Dukat hub of mines, the Albazino concentrator and POX (pressure oxidation) facility at Amursk boosted output.

Gold production jumped 23% in the quarter to 190,000 ounces and was 22% higher in the first six months of 2013.

Polymetal, which is 17.7% owned by billionaire Alexander Nesis, added it is currently "testing its assets for impairment at lower commodity prices" and expects to take a charge of between US$280 and US$340mln in the half year figures.

Revenues in the latest quarter rose by 8% to US$399 mln, but were 3% lower over the half year at US$740mln.

Guidance for the full year was maintained at 1.2 mln oz gold equivalent, boosted by sales of Mayskoye concentrate and ongoing improvements at the Amursk POX.

Broker Canaccord Genuity estimates average all-in costs this will  be US$1180/oz compared to US$1270/oz for the average of its peers.

With an improving grade profile, Polymetal is better placed than its peers to weather the current low gold price environment, adds the broker.

Polymetal is not along in writing down the value of its assets.

Some US$15bln has been written off the value of their assets by miners to precious metals sector due the 20% slump in the price of gold.

View full POLY profile View Profile

Polymetal International Timeline

Newswire
August 30 2013

Related Articles

Horse Hill drilling site under construction
March 14 2018
Sue Corrigan is a geologist and geoscientist with 40 years' industry experience in both exploration and development geology
Alaska map
October 02 2018
The project includes the “smoking gun” deposit Zackly which contains an inferred resource of 41,200 tonnes of copper, 213,000 ounces of gold and 1.5 million ounces of silver, with mineralisation continuing 100 metres below the bounty.
1537437472_NissanLeaf.jpg
September 20 2018
Kodal Minerals is moving rapidly to work up the Bougouni project in Mali
Copyright © Proactiveinvestors.com, 2018. All Rights Reserved - Proactive Investors North America Inc., Proactive Investors LLC

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use