OREANDA-NEWS. August 29, 2014. Polymetal International plc (LSE, MICEX: POLY; ADR: AUCOY) (together with its subsidiaries – “Polymetal”, the “Company”, or the “Group”) is pleased to announce the Group’s financial results for the six months ended 30 June 2014.

FINANCIAL HIGHLIGHTS
Revenue in 1H 2014 increased by 1% to USD 727 million compared to 1H 2013 (“year-on-year”) despite the average realised gold and silver prices decreasing 10% and 21% respectively year-on-year. The price decline was offset by 12% growth in the volume of gold equivalent sold.

Group Total Cash Cost1 was USD 627 per gold equivalent ounce (“GE oz”), down 13% compared to 2H 2013 (“half-on-half”) and down 20% year-on-year due to a robust operational performance, resulting in higher average grades processed and increased throughput across the portfolio, coupled with significant Russian Rouble and Kazakh Tenge depreciation against the US Dollar. All-in cash costs1 amounted to USD 938/GE oz and decreased 22% year-on-year, driven mostly by a reduction in total cash costs during the period, combined with increased production levels and associated reduction in per ounce sustaining capital and exploration expenditure at operating mines.

Adjusted EBITDA was USD 310 million, an increase of 30% compared to 1H 2013, driven mostly by strong cost performance and production growth which offset the decline in commodity prices. Adjusted EBITDA margin was 43% compared to 33% in H1 2013;

Net earnings were USD 100 million compared to a net loss of USD 255 million in 1H 2013 recorded as a result of non-cash foreign exchange losses and impairment charges in the prior period. Underlying net earnings (adjusted for the after-tax amount of impairment charges/reversals) were USD 101 million (1H 2013: USD 17 million).

For 2013, a regular dividend of USD 0.08 per share (total of US\\$ 31 million) was paid in May 2014, in accordance with Polymetal’s dividend policy. Based on Net Debt1 / Adjusted EBITDA as at 30 June 20143 being 1.55 (31 December 2013: 1.75), the Board has declared an interim dividend of USD 0.08 per share, representing 30% of the Group’s underlying net earnings for 1H 2014.

Net debt at 30 June 2014 decreased by USD 7 million to USD 1,038 million (31 December 2013: US\\$ 1,045 million), while the Company paid dividends of USD 31 million during the period. Free cash flow was USD 29 million and is expected to be significantly stronger in the second half of the year due to the planned de-stockpiling at Mayskoye and the seasonal reduction of the timing gap between production and sales.

The Company is reducing its full-year Total Cash Cost guidance to USD 650-700 per gold equivalent ounce and All-in cash costs to USD 950-1000 per gold equivalent ounce on the back of continued weakness of the Russian Rouble and expectation of a continued strong operating performance. This guidance could be further revised downwards should the weakness in the Rouble persist during the rest of the year.

On 14 August 2014, the General Meeting of Shareholders approved the definitive agreement to purchase the Kyzyl Project, a large gold deposit in Kazakhstan with JORC-compliant reserves of 7 Moz of gold at 7.5 g/t. Completion is conditional on receiving regulatory approvals from the Kazakh authorities which is expected in September 2014. The cash element of the transaction will be financed with available undrawn committed facilities which currently amount to US\\$ 1,115 million.