Profits at Polymetal rise sharply

Production and Markets

Publishing Date: 23 Dec 2008 2:11pm GMT
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Russia's top silver miner, Polymetal, posted a first-half to June net profit of US$43.1 million against a loss of US$7.7 million a year earlier as output and metals prices both rose.

The mining company, which gave no updates on its performance since mid-year or guidance for 2009, last week maintained its 2008 production forecast for gold and silver at 8.5t and around 530t, respectively.

It said that the average realised gold price rose by 38% in the first half to US$914/oz, and the average realised silver price by 90% to US$17.1/oz after sales at below-market prices under forward contracts were discontinued.

Earnings before interest, taxation, amortisation and depreciation (EBITDA) more than trebled to US$121.2 million, Polymetal said. Revenue rose by 86% to US$258.8 million.

Net profit was boosted by a US$8.4 million one-off gain linked to the revaluation of its recently acquired Kubaka deposit.

Polymetal shares added around 5.2% by 0916 GMT, outperforming a broadly flat performance on Russia's MICEX stock index.