Polymetal International PLC (LSE:POLY)’s revenue rose in the second quarter as higher metal prices outweighed a decline in precious metal production.
Revenue for the quarter was up 6% year-on-year to US$ 681mln, pushing first-half revenue up 12% to US$1.27bn for the FTSE 100 miner.
Gold equivalent production fell 6% in the quarter from the year-earlier period to 339,000 ounces due to the planned grade declines at Kyzyl, its flagship project in Kazakhstan, and Albazino in Russia.
It reiterated its 2021 production guidance of 1.5 million gold equivalent ounces and its cost guidance of US$700-750 an ounce on a total cash cost basis. Polymetal noted that the continuing macro and COVID-related pressures are affecting its capital expenditure.
Russia and Kazakhstan have entered the third wave of the COVID-19 pandemic with record numbers of infections and deaths, it said, adding that it has less than 50 active cases within the company and that none of them are at operating sites.
“COVID-related transportation restrictions have led to a material increase of Kyzyl concentrate in storage and transit to China and prompted the management to accelerate seasonal summer purchasing campaign across the portfolio,” it said.
“These factors drove a significant increase in working capital levels, which should normalise by the year-end.”
Net debt increased by US$0.5bn for the quarter to US$1.83bn mainly due to record final dividend payment of US$0.4bn.