Polyus boosts gold production 13% to 1.58 mln oz in Jan-Sept
MOSCOW. Oct 19 (Interfax) - PJSC Polyus , Russia's biggest gold miner, increased gold production by 13% to 1.58 million ounces in the first nine months of 2017, the company said in a trading update.
Production rose 16% year-on-year to 642 koz in the third quarter on the back of higher volumes at the Olimpiada, Verninskoye and Kuranakh deposits, the company said.
Given the 9M results, "we remain confidently on track to meet our previously announced production guidance for 2017 of 2.075 million-2.125 million ounces for 2017," Polyus CEO Pavel Grachev was quoted as saying.
Polyus estimated that its revenue from gold sales grew by 10% year-on-year to $1.951 billion in the nine months, including 5% to $734 million in the third quarter.
The company's gross debt shrank by $289 million or 6% in the third quarter to $4.272 billion. The net debt stood at $3.151 billion at the end of September, 2% more than in Q2. As initially stated, the company used most of the proceeds from an SPO to make an early prepayment of several bank credit facilities. The company raised $400 million with the SPO, and the remaining portion of the offering proceeds are expected to be utilized during the Q4.
PJSC Polyus operating results:
| Q3 2017 | Q3 2017/Q3 2016 | Q3 2017/Q2 2016 | 9M 2017 | 9M 2017/9M 2016 | |
| Refined gold, koz | 642.3 | 16% | 32% | 1,580.4 | 13% |
| - Refined gold, koz | 561.6 | 9% | 23% | 1,438.5 | 9% |
| - - Olimpiada mine | 264.1 | 23% | 17% | 709.4 | 30% |
| - - Blagodatnoye mine | 116.0 | 0% | 10% | 330.1 | -2% |
| - - Verninskoye mine | 53.1 | 24% | 0% | 160.1 | 12% |
| - - Kuranakh mine | 43.4 | 9% | 12% | 123.1 | 5% |
| - - alluvial gold | 85.0 | -11% | 2.7x | 115.9 | -10% |
| Gold in flotation concentrate, koz | 80.7 | 2.1x | 2.4x | 141.9 | 99% |
| Gold payable in concentrate, koz | 56.5 | 2.2x | 2.4x | 99.3 | 2.1x |
| Rock moved, kt | 61,898 | 69% | 19% | 161,167 | 50% |
| Stripping ratio, t/t | 5.2 | 18% | 11% | 4.8 | 13% |
| Ore mined, kt | 9,915 | 45% | 8% | 27,744 | 35% |
| Ore processed, kt | 7,299 | 12% | 5% | 20,854 | 7% |
| Recovery rate | 83.8% | -0.5 pp | -0.1 pp | 83.7% | -0.5 pp |
| Total dore & slime gold output, koz | 635.8 | 12% | 20% | 1,607.1 | 12% |
| Total gold sales, koz (including gold in concentrate) | 578 | 10% | 16% | 1,561 | 14% |
| Gold sales (incl. SPPP* effect), $ mln | 734 | 5% | 19% | 1,951 | 10% |
| Weighted-average refined gold selling price (excl. SPPP*), $/oz | 1,279 | -4% | 1% | 1,254 | -1% |
| Weighted-average refined gold selling price (incl. SPPP*), $/oz | 1,279 | -5% | 1% | 1,269 | -3% |
| SPPP* effect, $ mln | 0 | -100% | -100% | 22 | -55% |
* Strategic Price Protection Program
In Q3 2017, growth in output was mainly driven by an increase in volumes of ore processed, following the expansion initiatives at the company's core assets. Recoveries fell 0.5 pp y-o-y to 83.8% mainly due to lower recoveries at Olimpiada on the back of a temporary decrease in gravity and flotation recoveries.
Polyus is Russia's largest gold producer, mining hardrock and alluvial deposits in the Krasnoyarsk territory, Irkutsk, Magadan and Amur regions and Yakutia. Polyus Gold International Limited (PGIL), the beneficiary of which is Suleiman Kerimov's son Said, is the principle shareholder in PJSC Polyus with 82.44% of shares, the free float is 16.34% and the rest of the shares are held in treasury.