StockMarketWire.com - Polymetal produced 324 Koz of gold equivalent (GE) in the second quarter of 2018, up 16% year-on-year.

Volumes at Svetloye and Amursk POX combined with improved grades at Omolon drove the strong performance.

Gold production for the quarter was 232 Koz, up 22% year-on-year. Silver production grew by 2% to 6.8 Moz year-on-year.

HIGHLIGHTS:

- GE production for the first six months of 2018 was 619 Koz, an 11% increase year-on-year and fully in line with guidance

- Stronger production in the 2H will be driven by traditional seasonal concentrate de-stockpiling at Mayskoye, as well as first contributions from the recently launched Kyzyl operation

- Kyzyl produced first concentrate in June, one month ahead of schedule. The operation is expected to ramp up to full throughput capacity (150 Kt per month) and reach design recoveries (86%) by October 2018. The company plans to produce 80 Koz of payable gold at Kyzyl this year

- Gold sales for the quarter increased by 17%, which largely offset a 7% decline in silver sales as the Company generated a total of $435m in revenues, up 13% compared to previous year

- During the quarter the Company generated significant free cash flow. Net debt increased by approximately $75m as the company paid $129m of final dividends for FY2017 ($0.30 per share). As in prior years, we expect significantly stronger free cash flow generation in the second half of the year on the back of higher production volumes and seasonal working capital drawdowns

- Polymetal is pleased to report that no fatalities occurred in the quarter. The Group's LTIFR improved to 0.17 versus 0.19 in Q2 2017. As part of a continuous effort improve across health and safety metrics, in Q2 we have implemented two new standards - voice reporting of near-misses to improve communication underground, and an incident recording system to improve the efficiency of preventive measures

- The Company remains on track to meet its FY 2018 production guidance of 1.55 Moz of gold equivalent at TCC of $650-700/GE oz and AISC of $875-925/GE oz. Due to the seasonality of revenues, both TCC and AISC are expected to be at the higher end of the guidance range for the first half of the year. The cost guidance remains contingent on the Rouble/Dollar exchange rate dynamic that has a significant effect on the Group's Rouble-denominated operating costs. Polymetal will announce its half-yearly financial results on 22 August 2018.


At 8:00am: [LON:POLY] Polymetal International PLC share price was +0.9p at 685.5p



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