21 January 2016

Polymetal International plc (LSE, MOEX: POLY; ADR: AUCOY) (together with its subsidiaries - 'Polymetal', the 'Company', or the 'Group') is pleased to announce the Group's production results for the fourth quarter and twelve months ended December 31, 2015.

HIGHLIGHTS

  • Polymetal reports another year of strong operational delivery. Gold equivalent production for the year (based on 1:60 Ag/Au conversion ratio) comprised 1.40 Moz and exceeded the original production guidance for 2015 of 1.35 Moz by 4%.
  • Gold production was 861 Koz, down 9% year-on-year, while silver production was 32.1 Moz, an increase of 12% compared to 2014. Gold sales were 864 Koz, down 8% year-on-year while silver sales were 31.2 Moz, up 6% year-on-year, in line with production dynamics and volume.
  • Polymetal continued to generate free cash flow in the fourth quarter. On the back of robust cash flow generation for the year, the Company paid out US$ 127 million of special dividends to shareholders, bringing the total amount of dividends declared during 2015 to US$ 216 million.
  • Net debt at 31 December 2015 was US$ 1,298 million, an increase of just US$ 30 million compared to 30 September 2015.
  • Given the persistent change in gold/silver market price ratio, Polymetal has decided to change the gold/silver ratio used in presenting gold equivalent (GE) production from 1/60 to 1/80. The comparative numbers for prior periods and production guidance were restated accordingly in this release. The effect of this restatement on reported production numbers and guidance is summarised in the table below. There is no impact on the projected and reported cash costs metrics as they have been and will continue to be based on actual realised prices. Any further revisions to the new conversion ratio would only be triggered by a change in market ratio by more than 20%.
  • Gold equivalent production in the fourth quarter (based on the new 1:80 Ag/Au conversion ratio) was 310 Koz, a decrease of 16% year-on-year. Quarterly gold production was 219 Koz, down 27% year-on-year, mainly driven by change of mining method at Mayskoye and planned grade declines at Varvara, Omolon, and Voro. Silver production in the fourth quarter was 7.2 Moz, up 30% year-on-year, driven by continued strong performance at Dukat.
  • The newly established Safety and Sustainability Committee of the Board has started in-depth review of safety and environmental management systems of the Company and the measures currently being undertaken to achieve substantial improvement in safety performance, with significant focus placed on safety of underground operations and preventive risk management activities.
  • The Company reconfirms its production guidance for 2016 and 2017, which will comprise 1.23 Moz of gold equivalent and for 2017 at 1.30 Moz of gold equivalent (after restatement of the gold/silver price ratio to 1/80).
  • Total cash cost guidance for 2016 remains unchanged at US$ 525-575/GE oz and all-in sustaining cash costs of US$ 700-750/GE oz, with an update to be provided along with the preliminary financial results release in March 2016. A further reduction of cash costs is expected from continuing devaluation of the Russian Rouble and Kazakh Tenge.

'Polymetal has delivered consistent operating performance against the backdrop of weak commodities prices, maintaining robust free cash flow and dividend payments to our shareholders', said Vitaly Nesis, Group CEO of Polymetal. 'In the year ahead, we will focus on safety and consistent operational delivery at our existing mines, as well as moving Kyzyl towards production in 2018'.

CONFERENCE CALL AND WEBCAST

Polymetal will hold a conference call and webcast on Thursday, 21 January, 17:30 Moscow time (14:30 London time).

To participate in the call, please dial:
8 10 8002 041 4011 access code 344520# (free from Russia), or
+44 (0) 20 3367 9453 (free from the UK), or
+1 866 907 5925 (free from the US), or
any of the above numbers (from outside the UK, the US and Russia) or follow the link:
http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=3271
Please be prepared to introduce yourself to the moderator or register.

Webcast replay will be available on Polymetal's website (www.polymetalinternational.com) and at http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=3271. A recording of the call will be available immediately after the call at +44 (0) 20 3367 9460 (from within the UK), +1 87 7642 3018 (from within the US) and +7 495 745 7948 (from within Russia), access code 298660#, from 17:30 Moscow time Thursday, January 21, till 17:30 Moscow time Thursday, January 28, 2016.

Please follow the link t o find pdf-version of the release.

Media

Investor Relations

FTI Consulting
Leonid Fink
Jenny Payne

+44 20 3727 1000

Polymetal
Maxim Nazimok
Evgenia Onuschenko
Elena Revenko

ir@polymetalinternational.com

+7 812 313 5964 (Russia)

+44 20 7016 9503 (UK)

Joint Corporate Brokers

Morgan Stanley
Sam McLennan

+44 20 7425 8000

RBC Europe Limited
Darrell Uden
Jonny Hardy

+44 20 7653 4000

FORWARD-LOOKING STATEMENTS

THIS RELEASE MAY INCLUDE STATEMENTS THAT ARE, OR MAY BE DEEMED TO BE, 'FORWARD-LOOKING STATEMENTS'. THESE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS AT THE DATE OF THIS RELEASE. THESE FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY, INCLUDING THE WORDS 'TARGETS', 'BELIEVES', 'EXPECTS', 'AIMS', 'INTENDS', 'WILL', 'MAY', 'ANTICIPATES', 'WOULD', 'COULD' OR 'SHOULD' OR SIMILAR EXPRESSIONS OR, IN EACH CASE THEIR NEGATIVE OR OTHER VARIATIONS OR BY DISCUSSION OF STRATEGIES, PLANS, OBJECTIVES, GOALS, FUTURE EVENTS OR INTENTIONS. THESE FORWARD-LOOKING STATEMENTS ALL INCLUDE MATTERS THAT ARE NOT HISTORICAL FACTS. BY THEIR NATURE, SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER IMPORTANT FACTORS BEYOND THE COMPANY'S CONTROL THAT COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON NUMEROUS ASSUMPTIONS REGARDING THE COMPANY'S PRESENT AND FUTURE BUSINESS STRATEGIES AND THE ENVIRONMENT IN WHICH THE COMPANY WILL OPERATE IN THE FUTURE. FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE. THERE ARE MANY FACTORS THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN SUCH FORWARD-LOOKING STATEMENTS. THE COMPANY EXPRESSLY DISCLAIMS ANY OBLIGATION OR UNDERTAKING TO DISSEMINATE ANY UPDATES OR REVISIONS TO ANY FORWARD-LOOKING STATEMENTS CONTAINED HEREIN TO REFLECT ANY CHANGE IN THE COMPANY'S EXPECTATIONS WITH REGARD THERETO OR ANY CHANGE IN EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH ANY SUCH STATEMENTS ARE BASED.

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Polymetal International plc issued this content on 2016-01-21 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 2016-01-21 07:24:04 UTC

Original Document: http://www.polymetalinternational.com/investors-and-media/news/2016/2016-01-21.aspx?sc_lang=en