Polymetal International PLC expects to beat its full-year production guidance of 1.6 million gold equivalent ounces by up to 50,000 ounces due to the steady performance of its assets.
The company's gold equivalent production for the first nine months reached 1.1 million ounces, a 4% increase year on year.
While gold equivalent output in the third quarter dropped 5% year on year to 447,000 ounces, the number did not include most of the production from the Kyzyl and Mayskoye mines.
The unaccounted 36,000 gold ounces at Kyzyl and 34,000 gold ounces at Mayskoye will be shipped and booked as production in the fourth quarter, the company said Oct. 15, as deliveries of concentrate to the Amursk POX plant and off-takers in China are expected to reach full capacity after the commissioning of a new railway spur in October.
Total gold production for the quarter stood at 356,000 ounces, down 4% year on year, while silver production totaled 6.7 million ounces, a decrease of 10%, as a result of planned grade declines at the Dukat operation.
The Russian miner said it is likely to outperform its cost guidance of US$650 to US$700 per ounce of gold equivalent for total cash costs and US$875 to US$925 per ounce of gold equivalent for all-in sustaining cash costs thanks to the recent weakness of the Russian ruble and the Kazakhstani tenge against the U.S. dollar.
Third-quarter revenue fell 16% year on year to US$459 million due to lower metal prices and lower sales volumes driven by the buildup of working capital in the form of concentrate. Gold sales volumes totaled 321,000 ounces, while silver sales stood at 5.3 million ounces.
Meanwhile, Polymetal said it increased its stake in the Veduga gold deposit to 74.3% through the acquisition of a 31.7% interest in Amikan LLC, the license holder for the property, for US$19.7 million, payable in Polymetal shares.
In the deal, Polymetal issued 2,456,049 new ordinary shares, representing 0.54% of its total increased share capital. The company said the value of Amikan's gross assets subject to the transaction is US$66.8 million, with an attributable reported pretax loss of US$17.3 million based on last year's financial accounts.