Polymetal sees earnings climb on gold prices

RUSSIAN miner Polymetal yesterday reported a 21 per cent jump in profit for 2011, fuelled by high gold prices.
The company, which joined the FTSE 100 last year, achieved a $290m (£180m) profit while forecasting that it will produce one million ounces of gold in 2012.

Polymetal said the price that it was receiving for its gold was up 26 per cent on last year.

Chief executive Vitaly Nesis said in a statement: “2011 was a very successful year for the company. We believe that a combination of robust operating performance with a good momentum achieved in the second half of the year and favourable market conditions, has delivered strong financial results in 2011 and superior positioning for value creation in the coming years.

“Looking ahead to 2012, the company believes that the gold price will stay above $1,500/oz, as the key fundamental factors affecting the price are still in place for this year and are supporting the investment demand for gold.”

Nesis added that he expected 2012 to prove a “strong financial year” for the company.

Polymetal’s adjusted earnings before interest, taxation, depreciation and amortisation (Ebitda) in 2011 grew by 47 per cent to $624m while sales reached $1.33bn, up 47 per cent.

Its maiden dividend was set at $0.20 a share. Polymetal is controlled by Russian businessmen Alexander Nesis and Alexander Mamut alongside Czech private equity investor PPF.

Market volatility has triggered massive investment in gold, which is viewed as a safe haven.