Russia's Polymetal cuts 2013 production estimate
MOSCOW (Reuters) - Russian precious metals miner Polymetal International Plc (POLYP.L) has suffered a delay in starting production at a gold deposit in the Chukotka peninsula in Russia's far east, forcing it to cut the amount of gold it expects to produce next year.
Polymetal, controlled by entrepreneurs Alexander Nesis and Alexander Mamut alongside Czech private equity investor PPF, revised down its production guidance for 2012 by 100,000 troy ounces, or roughly 7.7 percent, mostly due to a delay in the commissioning of its Mayskoye gold concentrator, previously expected to be operational in 2012.
The downgrade took the shine off a results statement in which Polymetal raised its 2012 output guidance after a strong third-quarter performance.
It said expected output of 1.1 million troy ounces this year of gold equivalent - a measure of gold and other metals expressed in units of gold - up from a previous estimate of 1 million troy ounces.
"This (delay) slightly spoiled the festive mood from the strong third-quarter results," said analyst Nikolai Sosnovsky at VTB-Capital. "It will unlikely cause damage on a net basis, but may be taken as an excuse by investors to sell (Polymetal) stock on the currently high level."
Shares in the company, which joined London's FTSE 100 .FTSE index last year, were down 0.5 percent at 11.54 pounds by 4.31 a.m. EDT, having risen 53 percent since June 1, propelled by high gold prices.
"We have demonstrated another record quarterly performance this year, driven by strong operational delivery at both mature and new operations and allowing us to beat our original production guidance," CEO Vitaly Nesis said in a statement.
Its third quarter, gold equivalent production surged 48 percent to 818,000 troy ounces compared with the same period last year.
The company said it expected to produce 1.2 million troy ounces of gold equivalent in 2013, including between 760,000 and 800,000 troy ounces of gold and 23 to 24 million ounces of silver and 5,000 to 6,000 metric tons of copper.
Polymetal also said it would raise its dividend payout ratio to 30 percent of net earnings from an earlier announced 20 percent, saying this would bring it into line with global competitors.
The group kept its 2014 production guidance unchanged at 1.4 million troy ounces of gold equivalent.