26th Aug 2021 08:31
(Alliance News) - Polymetal International PLC on Thursday posted improved first-half earnings as commodity prices surged, though the gold miner lifted its capital expenditure guidance for the whole of 2021.
Shares in the company were 1.7% lower at 1,497.00 pence each in London on Thursday morning, one of the worst performing blue-chip costs.
For the six months to June 30, revenue was USD1.27 billion, up 12% from USD1.14 billion last year. Pretax profit was USD521 million, rising 11% from USD470 million.
Polymetal said its average realised gold and silver prices tracked market dynamics and increased by 8% and 59%, respectively, during the period.
The company declared a USD0.45 per share interim payout, up 13% from USD0.40 a year earlier.
Gold output fell 1.1% annually to 635,000 ounces and silver production was 4.1% lower at 9.4 million ounces. Gold equivalent production fell 1.2% to 714,000 ounces.
Looking ahead, Polymetal said it is on track to meet its 2021 production guidance of 1.5 million ounces of gold equivalent.
Total cash cost will be in a range of USD700 to USD750 per gold equivalent ounce. All-in sustaining costs will be USD925 to USD975 per gold equivalent ounce. This guidance is contingent on the Russian ruble-dollar and Kazakhstani tenge-dollar exchange rates, which have a significant effect on the miner's local-currency denominated operating costs, it noted.
However, Polymetal lifted its capital expenditure guidance to between USD675 million to USD725 million, from the previous forecast of USD560 million. The miner put this down to wage inflation, a feasibility study at its POX-3 asset and "continuing macroeconomic pressures".
A planned fast-track development of its Prognoz silver project also will lead to a higher capex for the year. Polymetal said that accelerating the project's development will mean payable output comes three years earlier than initially planned, allowing the company "to benefit from the favourable silver market".
First payable concentrate output is expected in the third quarter of 2023.
By Eric Cunha; [email protected]
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