Polymetal International plc (POLY) 
Polymetal: Half-year report for the six month ended 30 June 2023 
25-Sep-2023 / 07:55 MSK 
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Release time  IMMEDIATE                              AIX, MOEX: POLY 
 
Date          25 September 2023 
 

Polymetal International plc

Half-year report for the six month ended 30 June 2023

"Despite external pressures, we made good progress in the first half of the year while adapting to the logistics constraints. High commodity prices against a weakening Rouble, combined with steady operating performance, drove a healthy growth in the Group's earnings, adjusted EBITDA and free cash flow. We expect stronger production, stable cash costs within the original guidance, and significant free cash flow generation for the second half of the year, while remaining focused on progressing our development projects on schedule", said Vitaly Nesis, Group CEO of Polymetal International plc, commenting on the results.

FINANCIAL HIGHLIGHTS

-- In 1H 2023, revenue increased by 25% year-on-year (y-o-y), totalling USUSD 1,315 million (1H 2022: USUSD1,048 million), of which USUSD 393 million (30%) was generated from operations in Kazakhstan and USUSD 922 million(70%) from operations in the Russia. Average realised gold and silver prices tracked market dynamics: gold priceincreased by 3% while silver price remained flat y-o-y. Gold equivalent ("GE") production was 764 Koz, a 3%increase y-o-y. Gold sales increased by 25% y-o-y to 570 Koz, while silver sales increased by 19% to 10.4 Moz. TheCompany recorded a sales-production gap, notably for Kyzyl, as a result of persistent railway issues at theeastward direction. This gap is expected to be closed by the year end as the Company is gradually adjusting itstransportation routes.

-- Group Total Cash Costs ("TCC")[1] for 1H 2023 were USUSD 944/GE oz, below the lower end of the Group'sfull-year guidance of USUSD 950-1,000/GE oz, while being up 11% y-o-y, mostly due to a planned grade decline combinedwith domestic inflation, which was partially offset by weaker currency as well as increase in sales volumesresulting in spread of fixed costs over a larger amount of ounces sold.

-- All-in Sustaining Cash Costs ("AISC")1 remained broadly unchanged at USUSD 1,386/GE oz, up 1% y-o-y, andwithin the full-year guidance range of USUSD 1,300-1,400/GE, reflecting the decrease in capitalised stripping on theback of completed stripping campaigns.

-- Adjusted EBITDA1 was USUSD 559 million, an increase of 31% y-o-y, driven by higher sales volumes. Of this,USUSD 200 million (36%) was earned from operations in Kazakhstan, achieving a margin of 51%, and USUSD 359 million(64%), or a margin of 39%, earned from operations in the Russian Federation.The Adjusted EBITDA margin increased by2 percentage points to 43% (1H 2022: 41%).

-- Underlying net earnings[2] increased by 28% to USUSD 261 million (1H 2022: USUSD 203 million). Net earnings[3] were USUSD 190 million (1H 2022: USUSD 321 million loss due to one-off impairment charges).

-- Capital expenditures were USUSD 375 million[4], largely unchanged compared with USUSD 373 million in 1H 2022.The Company currently expects its FY2023 capex to be in the original guidance range of USUSD 700-750 million.

-- Net operating cash inflow was USUSD 35 million (1H 2022: USUSD 405 million outflow). This includes positivecash flow of USUSD 140 million from operations in Kazakhstan and negative cash flow of USUSD 105 million fromoperations in the Russian Federation. The Group reported negative free cash flow1 of USUSD 341 million, which isstill a significant improvement over 1H 2022 negative FCF of USUSD 630 million, that is made up of USUSD 55 millioninflow coming from Kazakhstan and USUSD 396 million outflow attributable to Russian assets. As usual, free cash flowis expected to be stronger in the second half of the year due to seasonally higher production and working capitalrelease.

-- Net debt1 increased to USUSD 2,590 million during the period (31 December 2022: USUSD 2,393 million),representing 2.25x of the LTM Adjusted EBITDA (2022: 2.35x). The increase in net debt was mainly driven by theworking capital build-up.

-- Polymetal is on track to meet its original 2023 production guidance of 1.7 Moz of gold equivalent. Thecompany maintains its 2023 guidance range of USUSD 950-1,000/GE oz and USUSD 1,300-1,400/GE oz for TCC and AISC,respectively. This guidance remains contingent on the RUB/USD and KZT/USD exchange rates which have a significanteffect on the Group's local currency denominated operating costs.

Financial highlights [5]                  1H 2023  1H 2022  Change 
 
Revenue, USUSDm                             1,315    1,048    +25% 
Total cash cost[6], USUSD /GE oz            944      853      +11% 
All-in sustaining cash cost2, USUSD /GE oz  1,386    1,371    +1% 
Adjusted EBITDA2, USUSDm                    559      426      +31% 
 
Average realised gold price[7], USUSD /oz   1,926    1,864    +3% 
Average realised silver price3, USUSD /oz   22.9     22.9     0% 
 
Net earnings/(loss), USUSDm                 190      (321)    n/a 
Underlying net earnings2, USUSDm            261      203      +28% 
Return on Assets2, %                      10%      7%       +3% 
Return on Equity (underlying)2, %         13%      10%      +3% 
 
Basic earnings/(loss) per share, USUSD      0.40     (0.68)   n/a 
Underlying EPS2, USUSD                      0.55     0.43     +28% 
 
Net debt2, USUSDm                            2,590   2,393[8] +8% 
Net debt/Adjusted EBITDA                   2.25[9] 2.355    -4% 
 
Net operating cash flow, USUSDm             35          (405) n/a 
Capital expenditure, USUSDm                 375         373   0% 
Free cash flow2, USUSDm                     (341)       (630) +46% 
Free cash flow post-M&A2, USUSDm            (344)       (658) +48% 
 

OPERATING HIGHLIGHTS

-- No fatal accidents occurred among the Group's workforce and contractors in H1 2023 (consistent with H12022). Lost time injury frequency rate (LTIFR) among the Group's employees stood at 0.11 (0.08 in H1 2022), asthere were seven lost-time accidents, mostly related to falling or being hit by an object. None of the accidentswere within Kazakhstan operations.

-- GE output for H1 was up by 3% y-o-y to 764 Koz, including 213 Koz in Kazakhstan and 551 Koz in Russia. The Company reiterates its full-year production guidance of 1.7 Moz of GE (1.2 Moz in Russia and 500 Koz inKazakhstan).

                         1H 2023 1H 2022 Change 
 
PRODUCTION (Koz of GE1) 
Kazakhstan               213     244     -13% 
Kyzyl                    128     135     -5% 
Varvara                  86      109     -22% 
 
Russia                   551     500     +10% 
 
TOTAL                    764     744     +3% 
 
REVENUE (USUSDm) 
Kazakhstan               393     443     -11% 
 
Russia                   922     605     +52% 
 
TOTAL                    1,315   1,048   +25% 
 
NET DEBT2 (USUSDm) 
Kazakhstan               201     277     -27% 
 
Russia                   2,389   2,117   +13% 
 
Total                    2,590   2,393   +8% 
 
SAFETY 
LTIFR3 (Employees)       0.11    0.08    +36% 
Fatalities               0       0       n/a 

Notes:

(1) Based on 80:1 Au/Ag conversion ratio and excluding base metals. Discrepancies in calculations are due to rounding.

(2) Comparative information is presented for 31 December 2022.

(3) LTIFR = lost time injury frequency rate per 200,000 hours worked. Company employees only are taken into account.

update on THE re-domICILATION AND listing

On 7 August 2023, the Company successfully completed its re-domiciliation to the AIFC (Kazakhstan). On 10 August, trading resumed on Astana International Exchange, which is now the primary listing venue for Polymetal. Cancellation of the Company's listing from the London Stock Exchange completed on 29 August 2023. On 19 September 2023, trading in Polymetal shares also resumed on the Moscow Exchange.

Conference call and webcast

The Company will hold a webcast on Monday, 25 September 2023, at 9:00 London time (14:00 Astana time).

To participate in the webcast, please register using the following link: https://event.on24.com/wcc/r/4340529/ E960C65B2522657D1D7187BD73EFDBF4.

Webcast details will be sent to you via email after registration.

Enquiries

Investor Relations 
Polymetal International plc ir@polymetalinternational.com 
Evgeny Monakhov             +44 20 7887 1475 (UK) 
Kirill Kuznetsov            +7 7172 476 655 (Kazakhstan) 
 
Media 
Polymetal International plc media@polymetal.kz 
Ainur Baigozha              +7 7172 476 655 (Kazakhstan) 

FORWARD-LOOKING STATEMENTS

This release may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements speak only as at the date of this release. These forward-looking statements can be identified by the use of forward-looking terminology, including the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or "should" or similar expressions or, in each case their negative or other variations or by discussion of strategies, plans, objectives, goals, future events or intentions. These forward-looking statements all include matters that are not historical facts. By their nature, such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the company's control that could cause the actual results, performance or achievements of the company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the company's present and future business strategies and the environment in which the company will operate in the future. Forward-looking statements are not guarantees of future performance. There are many factors that could cause the company's actual results, performance or

achievements to differ materially from those expressed in such forward-looking statements. The company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.

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Attachment File: Polymetal International plc: Half-year report for the six month ended 30 June 2023

----------------------------------------------------------------------------------------------------------------------- Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

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ISIN:           JE00B6T5S470 
Category Code:  IR 
TIDM:           POLY 
LEI Code:       213800JKJ5HJWYS4GR61 
OAM Categories: 1.2. Half yearly financial reports and audit reports/limited reviews 
Sequence No.:   273452 
EQS News ID:    1732931 
 
End of Announcement  EQS News Service 
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(END) Dow Jones Newswires

September 25, 2023 00:55 ET (04:55 GMT)

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