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Polymetal sees revenue fall annually; considers re-domiciliation

Wed, 25th Jan 2023 12:17

(Alliance News) - Polymetal International PLC on Wednesday bemoaned "unprecedented" challenges over 2022, as it met its full-year production guidance but failed to deliver on revenue.

Polymetal is a Jersey-based gold and silver producer with assets in Russia and Kazakhstan. It has a portfolio of ten producing mines, alongside several future growth projects.

For 2022, revenue fell 3% year-on-year to USD2.8 billion, which Polymetal attributed to lower average gold and silver prices.

Meanwhile, fourth quarter revenue rose 30% on an annual basis to USD1.0 billion, as the company sold down metal and concentrate inventory accumulated in the previous quarters.

Gold equivalent production for the year amounted to 1.7 million ounces, representing a year-on-year increase of 2%, and in line with original production guidance.

Despite the ongoing war against Ukraine, Polymetal said that the first full year of operations at Nezhda and initial production at Kytyn - both located in Russia - compensated for declining grades at mature assets.

Fourth quarter gold output grew by 16% annually to 540 thousand ounces, driven by Nezhda contribution and strong grades at Kyzyl.

Net debt decreased over the quarter, falling by USD400 million to USD2.4 billion on the back of strong positive free cash flows from the unwinding of working capital.

Looking ahead, the company reiterated its current production guidance for 2023 of 1.7 million ounces of gold equivalent. Capital expenditures are expected to be between USD700 to USD750 million.

"2022 presented unprecedented challenges for our company. Nevertheless, Polymetal met original production guidance and maintained solid safety performance. In 2023, we are targeting stable production and return to free cash flow generation", said Chief Executive Officer Vitaly Nesis.

As previously announced, the company has continued to evaluate all available options to modify its asset holding structure in order to maximise shareholder value.

It has progressed the evaluation of a potential re-domiciliation of its parent company to a jurisdiction deemed to be "friendly" by the Russian Federation, which could unblock its ability to execute further corporate actions.

Polymetal said that re-domiciliation into the Astana International Financial Centre, a financial hub in Astana, Kazakhstan, would be its preferred jurisdiction.

Should the company proceed with a re-domiciliation to the AIFC, its primary listing may move to AIX, where its ordinary shares will be traded with the new ISIN.

Polymetal's evaluation of the re-domiciliation process is ongoing.

Polymetal shares were trading 2.5% lower at 337.40 pence each in London on Wednesday afternoon.

By Holly Beveridge; Alliance News reporter

Comments and questions to newsroom@alliancenews.com

Copyright 2023 Alliance News Ltd. All Rights Reserved.

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