Polymetal does not sell Russian assets – Business – Kommersant

Polymetal is no longer going to sell the Russian assets of the company, considering the option of splitting the business, part of which will be located in Russia and the other in Kazakhstan. Plans have changed due to the improvement in the sales situation. The company announces the gradual establishment of sales channels for the metal, which were violated during the first waves of sanctions.

The gold mining company Polymetal, the main shareholder of which is the ICT group of Alexander Nesis, refused ideas sale of Russian assets, Vitaly Nesis, the group’s chief executive officer, said during a teleconference with investors.

“The sale of Russian assets is no longer considered. Our goal is to maintain shareholder value,” said Mr. Nesis (quoted from TASS).

According to the main shareholder of Polymetal, we believe that the best scenario is the division of assets between the two jurisdictions, which will allow shareholders to get the maximum benefit from assets in the two countries.

The company operates in Russia and Kazakhstan, and Kazakhstani assets account for a significant share of the company’s business. They produced 500,000 gold equivalent ounces out of 1.7 million ounces of total output in 2021, and generated $984 million in revenue for a total revenue of $2.9 billion.

In Kazakhstan, the company operates at the Kyzyl fields with a production of 360 thousand ounces and Varvarinskoye (198 thousand ounces). Russia hosts Dukatsky hub (18.8 million ounces of silver), Omolonsky hub (201 thousand ounces of gold), Albazino (249 thousand ounces of gold), Maiskoye (139 thousand ounces), Svetloye (109 thousand ounces), Vorontsovskoye (93 thousand ounces), Nezhda (21 thousand ounces) and Amur GMK. Also in Russia there are a number of projects for the future.

Western sanctions did not affect Polymetal and its shareholders directly, but disrupted the logistics of sales.

November 2 Polymetal informed in the report on operating results on the restructuring of distribution channels and the sale of accumulated stocks. “At the end of the third quarter, export sales fully resumed, and the group’s management expects that the gap between production and sales will be closed before the end of the year,” the report says.

In the first nine months of 2022, gold production decreased by 2% year-on-year, to 1 million ounces, silver – 1%, to 13.8 million ounces. Revenue for the same period fell 16% to $1.7 billion. Gold production forecast for this year remains the same at 1.7 million ounces.

Evgeny Zainullin