Gold miner Petropavlovsk said that total sales had risen 39 per cent in the first half of the year despite an ongoing battle for control of the Russia-focused firm’s board.
Shares shot up over 20 per cent on the back of the results, which the firm said was down to the performance of a new specialised processing plant.
The results came after seven board members were voted off the firm’s board by a group of investors in June.
New chief executive Alya Samokhvalova told City A.M. that it was in the interests of all shareholders for all parties to make discussions “open and transparent”.
“If that group is not happy with the strategy, then they have the voice and such significant holdings that they should come to all shareholders and to the board with an open letter to explain why”, she added.
She urged the parties to find a solution that was workable for all shareholders, amid fears from some analysts that the rebel investors were lining up an underprice takeover of the gold miner.
Petropavlovsk is one of the only miners to have a pressure oxidation hub facility, which allows it to process gold from a very wide range of deposits, making it a highly attractive prospect in a booming market.
“It’s a money printing machine”, Samokhvalova said. “It gives us a unique position to become the leading gold producer in Russia”.
At the June AGM, board members including chief executive Pavel Maslovsky and chairman Sir Roderic Lyne were voted off the company’s board by several shareholder groups, including UGC, Everest Alliance, Slevin and Fortiana Holdings.
Between them, the investors hold 39 per cent of Petropavlovsk’s shares, which allowed them to carry a majority in a voter turnout of 73 per cent.
Subsequently, fellow shareholder Prosperity Capital Management, which controls 20 per cent of shares, has complained to the Takeover Panel, saying that the investors acted in concert to oust the board members.
Everest hit back, calling for legal action against the ousted directors and a “forensic investigation” into all Petropavlovsk’s financial dealings for the last three years.
A spokesperson for the investor also denied the allegation that Everest was acting in concert with the other shareholder groups.
The company is planning on holding another general meeting next month in order to select a new board.
In a note, Canaccord Genuity analysts said: “We stress that, at this stage, there has been no fundamental change in the strategy or operational outlook for the company.
“Our expected outcome is for the company to move towards a reconvened general meeting within the next 1-2 months, at which point the majority of the previously proposed board nominees will stand for re-election.
“If successful, it may even be a case of ‘business as usual’ for Petropavlovsk”.