Polymetal EBITDA drops 12% to $257 mln in H1, slightly below forecast
MOSCOW. Aug 29 (Interfax) - Polymetal , Russia's largest silver producer and one of the country's biggest gold miners, reported adjusted EBITDA down 12% year-on-year to $257 million in the first half of 2017.
The company attributed the drop to an increase in costs due to the strengthening of the ruble, which was partially offset by production growth.
Analysts at seven investment companies and banks polled by Interfax expected Polymetal's EBITDA to fall by 11% to $263 million.
Polymetal's net profit fell by 27% year-on-year to $120 million in the first half due to the decline in EBITDA and noncash exchange rate gains. Adjusted net profit fell by 6% to $117 million.
The company said total cash cost (TCC) grew 28% to $656/oz gold equivalent (GE) in H1 2016, mainly as the ruble strengthened 21% against the dollar and the macroeconomic situation in Russia and Kazakhstan stabilized. All-in sustaining costs (AISC) rose 20% to $906/oz for the same reasons.
TCC and AISC should fall in H2 in line with the company's guidance for FY 2017 to $600-$650 and $775-$825 per ounce of GE. "Both cost measures are expected to decline in H2 on the back of seasonally higher production and sales, particularly at Mayskoye and Okhotsk," Polymetal said.
"Polymetal remains on track to meet its 2017 production guidance of 1.40 Moz of gold equivalent. TCC and AISC are expected to trend downward in H2 to meet the original FY 2017 guidance range of $600-650/GE oz and $775-825/GE oz, respectively. This guidance remains dependent on exchange rate and oil price fluctuations," the company said.
In line with the company's revised dividend policy, Polymetal's board of directors recommended paying an interim dividend of $0.14 per share for the first half of 2017. This amounts to 50% of adjusted net profit, taking into account that the net debt to adjusted EBITDA ratio was 2.19, lower than the set threshold of 2.5.
