OREANDA-NEWS.  September 06, 2012. Polymetal International plc (LSE: POLY) (together with its subsidiaries, including JSC “Polymetal” – “Polymetal”, the “Company”, or the “Group”) is pleased to announce the Group’s financial results for the six months ended 30 June 2012, reported the press-centre of Polymetal.

FINANCIAL HIGHLIGHTS

Revenue in 1H 2012 increased 41% to USD 767 million compared to 1H 2011 (“year-on-year”), driven mostly by 23% increase in gold equivalent sold and a 14% increase in the average realised gold price;

Group total cash cost was USD 691/AuEq oz, up 8% year-on-year and down 4% compared to 2H 2012 (“half-on-half”).  Strong operating performance and depreciation offset the combined impact of domestic inflation and adverse movement in gold/silver price ratio;

Adjusted EBITDA grew 53%, significantly faster than revenues, to USD 380 million; adjusted EBITDA margin was up 3.9 pp to 49.6%;

Net earnings were USD 149 million, down 2% year-on-year primarily as a result of non-cash foreign exchange losses of USD 60 million incurred on revaluation of US Dollar denominated debt versus foreign exchange gains of USD 44 million in 1H 2011. As a result, diluted EPS was USD 0.35 per share, 10% lower year-on-year;

Inaugural dividend of USD 0.20 per share (total of USD 77 million) paid for 2011 in June 2012 in accordance with the new dividend policy.  No interim dividend to be paid out, also in accordance with the stated policy;

Net operating cash flows nearly doubled to USD 158 million while capital expenditures declined 20% to USD 171 million.  These cash flow trends are expected to be even more pronounced in the second half of the year, as significant metal inventories at Dukat, Omolon and Albazino are drawn down and capital expenditures decrease further;

Group’s liquidity profile remains comfortable with Net Debt / Adjusted EBITDA further reduced from 1.4 as at YE 2011 to 1.3 as at 30 June 2012, with 61% of borrowings being long-term.

“We have demonstrated strong financial performance on the back of excellent production results in the first half of the year. Our key growth projects, Omolon and Albazino/Amursk, have started to pay off and have made a meaningful contribution to the Company’s financial results.  This was supported by stable production and cost performance at our mature operations”, said Vitaly Nesis, CEO of Polymetal, commenting on the results.

“I believe that the current US dollar exchange rate dynamics, which had an impact on our bottom-line performance in the first half of the year, will in turn favourably affect our cost base towards the year-end. We expect that our performance in the second half of the year will be driven by continued revenue growth from our new operations, decrease in working capital, and robust cost performance, allowing us to meet shareholder expectations.”