Page 125 - RusRPTMar19

Management Group is managing project, the reports said. ● Gold
Russian junior gold mine GV Gold announced a record production of 304.4koz in 2018 and also beating out management forecasts. A relatively young miner, the company has more than doubled its production in the last two years, the company said in a statement released on January 28. “GV Gold’s performance in 2018 has positioned the Company as one of the most dynamic players in the sector. We are confidently moving toward our goal of becoming one of Russia’s top five gold producers. We have successfully completed a large-scale investment cycle, a key result of, which was the launch of two strategic projects. By ramping up production capacities, the Company has reached an entirely new level, practically doubling gold production from 164 koz in 2016 to 304 koz in 2018,” GV Gold CEO German Pikhoya said. GV Gold has launched two new projects in the last two years at a time when the Central Bank of Russia (CBR) is snapping up nearly all the gold produced in Russia. Russia has been actively building up gold as a share of its gross international reserves (GIR) since 2007.
Russian leading gold producer Polyus Gold reported 4Q18 IFRS results, which came mostly in line with expectations on key numbers. Revenue declined by 7% q/q to $774mn, which was fully in line with consensus forecasts. The company’s EBITDA declined by 10% q/q to $484mn, which was 4% higher than BCS Global Markets estimates and again fully in line with consensus Net income fell to a negative $28mn materially missing consensus numbers due to non-operating losses, which 2018 capex came in lower than expected at $736mn vs the forecast $850mn. However, the 2019 target for capex is increased from $650mn to $725mn The second half dividends expected to be $296mn, which implies a dividend yield of 2.7%. The record date fro dividends is expected to be in May 2019.
Polymetal International has completed the sale of its Kapan mine in Armenia, according to a company press release on January 31. The deal is in line with the guidance on the sale announced earlier. The sale of Kapan, one of the highest cost mines in company’s portfolio, is part of the company’s moves to re-profiling and concentrate on lower cost and more profitable assets by selling non-core, high-cost assets. The Kapan mine had total cash costs (TCC) of $960/tonne in the first half of last year, which is high, and so the company decided to sell it. The Russian gold miner Polymetal International was downgraded to Hold by VTB Capital (VTBC) this week after a string of big gains have been realised, the bank said in a note on January 29. In June 2018 Polymetal commissioned a major Kyzyl mine in Kazakhstan ahead of schedule that has performed even better than expected. The company has managed to delivery on ambitious growth plans, and in general Russian precious metals miners could push the country to become the second-largest gold miner behind Australia by 2030, estimates by Aton Equity and the Institute of Geotechnology showed. The company trades at 2019F EV/EBITDA of 7.2x and P/NAV of 1.7x, roughly in line with global quality gold miners.
Leading Russian gold miner Polymetal to build the largest gold concentrate processing plant in Russia. The project is worth $431mn and will eliminate the need to use a similar plant in China, the company said on February 11. The board of directors of Polymetal has already approved the construction project of the second Amur hydrometallurgical plant (AMMK-2, Khabarovsk Territory), the company said. Capital costs in the period from 2019
125 RUSSIA Country Report March 2019 www.intellinews.com