Polymetal increases EBITDA 47% to $918 mln in 2012
MOSCOW. April 8 (Interfax) - Polymetal International, which controls Russia's OJSC Polymetal , drove up its adjusted earnings before taxes, depreciation and amortization (EBITDA) by 47% to $918 million in 2012, the company reported on Monday.
The consensus forecast for adjusted EBITDA was $885 million.
The adjusted EBITDA margin rose by 3 percentage points to 50%.
Net profit soared 38% to $401 million last year. Analysts had predicted it at $422 million.
Net earnings were negatively affected by additional tax provisions booked in respect of prior years and 2012 in the amount of $116 million, which are not expected to be recurring, the report said.
Revenue soared 40% to $1.854 billion last year.
Group total cash cost1 was $703/GE ounce and remained almost flat compared to the 2011 level of $701/GE oz as a result of intense management focus on cost control and despite external and inflationary cost pressures. Strong operating performance, resulting in increased average grade processed and increased volumes, coupled with moderate ruble depreciation against the dollar, offset the combined impact of domestic inflation and adverse movement in the gold/silver price ratio, the statement said.
Basic earnings per share came to $1.03, up 30% over 2011.
A final dividend of $0.31 per share (a total of $119 million) for 2012, representing 30% of net earnings, is proposed by the board in accordance with the new dividend policy, the report said.
Net operating cash flow more than doubled to $496 million in 2012, while capital expenditures declined 24% to $351 million, resulting in a total positive free cash flow of $139 million.
The Polymetal group's liquidity profile remains comfortable, with net debt to adjusted EBITDA further reduced from 1.4 as of the end of 2011 to 1.1 as of December 31, 2012, with 59% of borrowings being long-term, the report said.
The key factor involved in maintaining the company's current spending level this year will be increased productivity at the Albazino and Amursk Mining and Metallurgical Companies. By reducing capex due to the completion of all of its major investment projects, Polymetal will provide for greater cash flow generation, the statement said.
Despite the complications it faced with the launch of the Amursk POX, as a result of which the dates for reaching design productivity were pushed back, Polymetal expects the facility to reach its design indicators in Q4 2013.
The company is on track to deliver on 2013 production guidance of 1.2 million oz of gold equivalent production, with an off-take agreement signed for Albazino concentrate, and the Mayskoye concentrator approaching commissioning in April 2013 in accordance with the schedule, the report said.
There has been a dramatic increase in the resource base at Albazino, and potential new growth assets have been identified through successful exploration at Kutyn and Svetloye. These achievements indicate that Polymetal is on track to make development decisions on new asset development in H2 2013 or the beginning of 2014.
Ore reserves grew by 6% to 15.1 million oz of gold equivalent in 2012, while mineral resources (additional to ore reserves) grew by 35% to 18.7 million oz of gold equivalent, the statement said.
Polymetal International plc is the Jersey-registered holding company for Polymetal, Russia's top silver miner and one of the country's biggest gold producers. The company has operations in the Magadan and Sverdlovsk regions, the Khabarovsk territory, Chukotka and Kazakhstan.
The company's principal beneficiaries are Alexander Nesis' ICT Group (17.9%), Petr Kellner's PPF Group (20.86%), Alexander Mamut (10.12%), Alexander Mosionzhik's MBC Development (4.44%), and the former director of Baltiysky Zavod shipyard Oleg Shulyakovsky (4.27%).