Polymetal’s Q4 revenue jumps on inventory clearance

Smelter at Amursk POX. Credit: Polymetal International plc

Russian gold and silver producer Polymetal said on Wednesday its fourth-quarter revenue jumped 30% year-on-year to $1 billion as it sold down metal and concentrate inventory.

Polymetal has not been directly targeted by Western sanctions imposed on Moscow after it sent thousands of troops into Ukraine on Feb. 24. But, along with other Russian commodity producers, it has suffered from their impact as Western banks and shippers have reduced dealings with Russian companies.

The сompany’s gold equivalent output (GE), a mix of gold and other metals, increased 16% year-on-year in the quarter to 540,000 troy ounces, driven by the contribution of the Nezhda deposit and strong grades at Kyzyl.

For the full year, Polymetal’s output increased by 2% to 1.712 million ounces of GE, in line with its production guidance.

But the company’s revenue for 2022 fell by 3% to $2.8 billion on the back of lower average gold and silver prices.

Polymetal expects the gap between production and sales to close in the first half of 2023, it said.

The company reiterated its current production guidance for 2023 of 1.7 million ounces of GE and saw capital spending of $700-750 million.

“In 2023, we are targeting stable production and return to free cash flow generation,” CEO Vitaly Nesis said in the statement.

Polymetal said it was considering moving its parent company’s domicile and primary listing, currently in Jersey and London respectively, to “Russia-friendly” Kazakhstan, which “could unblock the ability to execute further corporate actions”.

(By Anastasia Lyrchikova; Editing by Mark Potter)

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