UPDATE 1-Russian gold miner Polyus boosts 2007 revenues

(Rewrites, adds details)

MOSCOW, June 9 (Reuters) - Polyus Gold's (PLZL.MM: Quote, Profile, Research, Stock Buzz) core earnings rose 9 percent last year to $334.8 million as the company, producer of a quarter of Russia's gold, enjoyed record prices for the precious metal.

Net profit, however, declined to $47.1 million in 2007 from $1.2 billion a year earlier. Polyus Gold's 2006 net profit was inflated by the sale of a stake in South African miner Gold Fields (GFIJ.J: Quote, Profile, Research, Stock Buzz) and dividends received from the same company. Polyus, the world's fourth-largest gold company by reserves, said on Monday revenues rose to $867.1 million in 2007 from $752.7 million in 2006.

The $334.8 million in earnings before interest, taxation, depreciation and amortisation (EBITDA) compared with $306.0 million in the previous year, the company said in a document published on its website, www.polyusgold.com.

"The positive revenue dynamics resulted solely from favourable market conditions," the company said. Gold production in 2007 was flat at 1.2 million ounces.

Polyus, which does not hedge its gold sales, said its average sales price in 2007 was $706.48 per ounce, up from $604.00 in 2006.

It sold 87 percent of its gold to Russian banks last year, a marked shift from the previous year, when exports accounted for 30 percent of the company's sales.

"The increase of sales in the domestic market is explained by more favourable contract terms concluded with Russian banks," Polyus said.

Polyus is the last battleground in the protracted asset split between billionaire partners-turned-rivals Mikhail Prokhorov and Vladimir Potanin, who each hold stakes in the company thought to be around 30 percent.

The company has ambitious plans to triple production by 2015 by opening up large gold deposits in Siberia and the Russian Far East. (Reporting by Polina Devitt and Robin Paxton; Editing by Quentin Bryar)