POLYUS TRADING UPDATE FOR THE SECOND QUARTER OF 2021
12 August, 2021
PJSC Polyus ("Polyus" or the "Company") today releases its 2Q 2021 operating results for the period ending 30 June 2021.
2Q 2021 HIGHLIGHTS
- Total gold output amounted to 671 thousand ounces, compared to 592 thousand ounces in the first quarter of 2021. This increase was driven by higher production volumes of refined gold across all deposits, as well as the start of the washing season at Alluvials and the recommencement of heap leaching operations at Kuranakh.
- Volumes of ore mined amounted to 17,026 thousand tonnes, up 2% on the previous quarter, driven by higher ore volumes mined at Kuranakh, Verninskoye and Natalka.
- Volumes of ore processed increased 9% quarter-on-quarter to 12,169 thousand tonnes, primarily due to the start of heap leaching operations at Kuranakh and higher processing volumes at Verninskoye and Blagodatnoye.
- Recovery rate increased to 82.6%, compared to 81.6% in the previous quarter, driven by higher recoveries at Olimpiada, Blagodatnoye and Natalka.
- Estimated gold sales amounted to $1,230 million, up 21% compared to the previous quarter, with an estimated weighted-average gold selling price of $1,815/oz (up 2% on the first quarter of 2021).
- As at 30 June 2021, the estimated net debt stood at $2,366 million, compared to $2,074 million as at the end of the previous quarter and $2,506 million on 30 June 2020.
1H 2021 HIGHLIGHTS
- Total gold output was 1,263 thousand ounces, down 2% compared to the first half of 2020. Doré volumes totalled 1,308 thousand ounces, down 5% year-on-year.
- Volumes of ore processed increased 4% to 23,295 thousand tonnes, reflecting improved performance across all operating assets following the implementation of expansion projects.
- Recovery rate stood at 82.1%, down 1.4 ppts from the prior-year period, primarily driven by a decrease in recoveries at Olimpiada and Blagodatnoye.
- Estimated gold sales increased 12% year-on-year to $2,247 million, with an estimated weighted-average gold selling price of $1,803/oz (up 8% on the first half of 2020).
2Q'21 | 1Q'21 | Q-o-Q | 4Q'20 | 3Q'20 | 2Q'20 | Y-o-Y | 1H'21 | 1H'20 | Y-o-Y | |
Olimpiada | 269.9 | 242.4 | 11% | 268.0 | 254.8 | 264.0 | 2% | 512.3 | 479.0 | 7% |
Blagodatnoye | 117.4 | 92.4 | 27% | 117.4 | 118.3 | 116.3 | 1% | 209.8 | 219.7 | -5% |
Natalka | 125.3 | 115.1 | 9% | 132.7 | 117.4 | 110.4 | 13% | 240.4 | 205.4 | 17% |
Verninskoye | 77.6 | 64.8 | 20% | 67.4 | 68.6 | 68.3 | 14% | 142.4 | 137.4 | 4% |
Kuranakh | 56.0 | 54.3 | 3% | 64.2 | 66.5 | 57.5 | -3% | 110.3 | 108.0 | 2% |
Alluvials | 25.2 | - | n.a. | 38.0 | 75.5 | 29.8 | -15% | 25.2 | 29.8 | -15% |
Refined gold, koz | 671.4 | 569.0 | 18% | 687.7 | 701.1 | 646.3 | 4% | 1,240.4 | 1,179.3 | 5% |
Flotation concentrate production, t | 159 | 11,671 | -99% | 7,323 | 23,219 | 30,023 | -99% | 11,830 | 56,208 | -79% |
Antimony in flotation concentrate, t | 0 | 1,919 | -100% | 1,837 | 3,950 | 2,432 | -100% | 1,919 | 5,171 | -63% |
Gold in flotation concentrate, koz | 0.1 | 22.7 | -100% | 22.0 | 70.0 | 44.1 | -100% | 22.8 | 106.0 | -78% |
Gold payable in concentrate, koz | 0.0 | 17.4 | -100% | 17.2 | 55.5 | 32.4 | -100% | 17.4 | 80.9 | -78% |
Total gold output, koz | 671.5 | 591.7 | 13% | 709.7 | 771.1 | 690.4 | -3% | 1,263.2 | 1,285.3 | -2% |
Rock moved, km³ | 33,120 | 31,587 | 5% | 30,741 | 32,210 | 28,909 | 15% | 64,707 | 61,282 | 6% |
Stripping ratio, m³/t | 1.5 | 1.5 | 0% | 1.4 | 1.4 | 1.3 | 22% | 1.5 | 1.3 | 15% |
Rock moved, kt | 85,191 | 81,290 | 5% | 78,706 | 82,535 | 73,836 | 15% | 166,481 | 157,188 | 6% |
Stripping ratio, t/t | 4.0 | 3.9 | 3% | 3.5 | 3.5 | 3.3 | 21% | 3.9 | 3.4 | 16% |
Ore mined, kt | 17,027 | 16,639 | 2% | 17,301 | 18,265 | 17,364 | -2% | 33,666 | 35,590 | -5% |
Ore processed, kt | 12,169 | 11,126 | 9% | 10,438 | 12,224 | 11,753 | 4% | 23,295 | 22,451 | 4% |
Recovery rate, % | 82.6% | 81.6% | 1.0ppts | 83.9% | 84.1% | 83.4% | -0.8ppts | 82.1% | 83.5% | -1.4ppts |
Total doré & slime gold output, koz | 693.4 | 614.7 | 13% | 660.7 | 770.2 | 712.4 | -3% | 1,308.1 | 1,372.6 | -5% |
"Pavel Grachev, Chief Executive Officer of PJSC Polyus, commented:
ESG UPDATE
2Q Highlights
- LTIFR1 of 0.18 YTD (H1 2020 - 0.06, Q1 2021 - 0.27). Zero fatalities at our operations during Q2.
- Automotive Accident Rate (AARk) at 0.18 (H1 2020 - 0.16, Q1 2021 - 0.17).
- Coronavirus: production assets remain unimpacted and operate without interruption. Thorough COVID-19 protocols remain in place. Employee vaccination program has resulted in worker immunization levels of over 60%.
- Polyus has published its 2020 Sustainability Report and ESG Data Pack. The report was independently assured by the Council for Non-financial Reporting of the Russian Union of Industrialists and Entrepreneurs (RSPP). The Sustainability audit for 2020, followed by the independent assurance statement was completed at Polyus Krasnoyarsk, Polyus Verninskoye, Polyus Aldan, Shared Service Center, and headquarters.
- Zero severe environmental incidents were recorded during the reporting period.
COVID response update
- Vaccination program of employees and contractors continues at all Polyus production sites.
- Preventive measures remain in place at all operations and offices, including enhanced medical screening, social distancing, supplying employees with personal protective equipment and regular disinfection of all communal areas.
- All shift employees and contractors are tested for COVID-19 and quarantined in observation facilities prior to transfer to Polyus' sites.
- Polyus multifunctional services center received a national award for the implementation of COVID prevention measures across the Company.
Environment and Climate
-
Renewables now represent 100% of Polyus' energy consumption: Polyus group has acquired I-REC green certificates to offset emissions from the remaining small share of Polyus' energy consumption not yet directly met by renewable energy sources. Earlier this year, Polyus signed a major agreement for the supply of renewable hydropower to Olimpiada and Blagodatnoye, which combined make up the
Company's largest production unit. - Polyus Logistics is now a signatory to the International Cyanide Management Code. As Polyus group's transport provider, Polyus Logistics will be able to operate in compliance with the Cyanide Code across all divisions.
- Polyus has launched a project with the Vitim natural reserve, Bodaibo district, to promote the conservation of wild ungulates.
- ICMM developed and issued a Tailings Management Good Practice Guide to help companies implement the Global Industry Standard on Tailings Management. Polyus was closely involved in the Guide's development, and took responsibility for producing a Russian version.
Health & Safety
- Verninskoye has received the interim results of its annual safety culture audit. The results demonstrated rapid progress, climbing to 3.6 points on the Bradley Curve from 3.5 points last year.
- A Group HSE risk management evaluation was completed; proposals for improvements were presented to top management and approved for implementation.
1 Based on a 200,000 work hours' factor.
- Polyus launched a special project to train candidates to drive heavy vehicles in line with corporate safety standards and offer internship programs to drivers without prior experience.
Local communities
- Polyus financed the equipment of the "Growth Point" center in Bodaibo, Irkutsk region, an educational center specializing in digital technologies and the arts.
-
Territorya. Irkutsk art festival took place in Irkutsk, bringing together local theatre companies from across
Polyus' regions of presence, including theatre companies performing in indigenous languages. - Polyus has established a new scholarship system to support geology and engineering students of the North-East State University in Magadan.
Employees
- Company-widevirtual live Q&A session took place between the group's CEO and all employees.
- Personnel engagement survey conducted among 3,200 Polyus employees.
- Operational efficiency training for line managers was carried out as part of a wider corporate educational program.
- Polyus is conducting a volunteer projects grant competition focusing on the environment, children, sports, donation, and pro-bono work.
- The annual arts competition for employees' children was launched, with a focus on the environment.
ESG Ratings and indices
- Polyus received an award from IR Magazine in the category for Best ESG materiality reporting
- Polyus' current ESG ratings:
- S&P Global CSA - 54
- CDP - Climate Change: C, Water Security: C
- Sustainalytics ESG Risk Rating - 26.8 (down from 27.5 at the end of Q1) o MSCI ESG - A
Olimpiada
2Q 2021 Highlights
- Average grade in ore mined rose to 3.24 g/t.
- Recovery rate rose to 83.8%, from 82.5% in the previous quarter.
- Total gold output amounted to 270 thousand ounces.
Gold output
Doré gold output stood at 280 thousand ounces, up 3% quarter-on- quarter, reflecting higher recovery rate during the reporting period. Total gold output (refined and concentrate) rose by 2% compared to
the previous quarter, to 270 thousand ounces. Production of flotation concentrate was almost zero. On a year-on- year basis, doré gold output declined by 8%, while total gold production was down 12%.
Mining works
Volumes of rock moved totalled 30,764 thousand tonnes (11,368 km³), a 5% increase on the first quarter of 2021. Polyus intensified stripping activities in the Zapadny pit, while completing the mining works at the third stage of the Vostochny pit. These resulted in a 6% decrease in volumes of ore mined to 3,092 thousand tonnes. Operations in the lower areas of the Vostochny pit were focused on higher-grade zones, resulting in a 5% increase in average grades to 3.24 g/t, compared to 3.08 g/t in the previous quarter. During the second quarter of 2021, Polyus delivered three Komatsu bulldozers to the site. Polyus will focus on stripping works intensification at the fourth stage of the Vostochny pit in the second half of 2021, resulting in a substantial increase in volumes of rock moved.
Ore processing
Volumes of ore processed totalled 3,648 thousand tonnes, down 1% compared to the previous quarter due to scheduled maintenance at Mill-1 and Mill-3. Polyus is progressing with initiatives to expand throughput capacity at Olimpiada, aimed at increasing this to 15.0 million tonnes per annum. Average grades in ore processed remained flat quarter-on-quarter, at 3.03 g/t. The recovery rate rose to 83.8%, up 1.3 ppts compared to the first quarter. This was driven by improved performance of the flotation circuit at Mill-3, following upgrades to the discharge at the SAG-mill, which led to improvement of the flotation feed. In addition, Polyus technical specialists introduced a Vertimill grinding unit, targeting BIO complex productivity improvement and lower losses at the CIL. Over the course of the second quarter, Polyus continued to improve the efficiency of BIO complex. This resulted in increased processing capacity and improved performance of the BIO units, following the modernization of BIO- 3 unit and ongoing calibration of the flowsheet at BIO complex.
Mining works and ore processing
2Q'21 | 1Q'21 | Q-o-Q | 4Q'20 | 3Q'20 | 2Q'20 | Y-o-Y | 1H'21 | 1H'20 | Y-o-Y | |
Rock moved, km³ | 11,368 | 10,849 | 5% | 11,073 | 11,165 | 9,233 | 23% | 22,217 | 21,652 | 3% |
incl. stripping, km³ | 10,249 | 9,657 | 6% | 9,711 | 9,661 | 7,702 | 33% | 19,906 | 18,622 | 7% |
Stripping ratio, m³/t | 3.3 | 2.9 | 14% | 2.6 | 2.3 | 1.8 | 83% | 3.1 | 2.2 | 41% |
Rock moved, kt | 30,764 | 29,372 | 5% | 29,979 | 30,236 | 25,021 | 23% | 60,136 | 58,642 | 3% |
incl. stripping, kt | 27,672 | 26,082 | 6% | 26,220 | 26,083 | 20,796 | 33% | 53,754 | 50,281 | 7% |
Stripping ratio, t/t | 8.95 | 7.9 | 13% | 7.0 | 6.3 | 4.9 | 83% | 8.4 | 6.0 | 40% |
Ore mined, kt | 3,092 | 3,290 | -6% | 3,759 | 4,153 | 4,225 | -27% | 6,382 | 8,361 | -24% |
Average grade in ore mined, g/t | 3.24 | 3.08 | 5% | 2.94 | 3.30 | 3.52 | -8% | 3.16 | 3.23 | -2% |
Ore processed, kt | 3,648 | 3,668 | -1% | 3,249 | 3,757 | 3,539 | 3% | 7,316 | 7,042 | 4% |
Average grade in ore processed, g/t | 3.03 | 3.02 | 0% | 3.34 | 3.56 | 3.47 | -13% | 3.03 | 3.34 | -9% |
Recovery, % | 83.8% | 82.5% | 1.3ppts | 84.9% | 86.1% | 85.4% | -1.6ppts | 83.1% | 85.1% | -2.0ppts |
Doré gold, koz | 279.5 | 271.8 | 3% | 281.4 | 319.2 | 305.0 | -8% | 551.3 | 628.7 | -12% |
Refined gold output, koz | 269.9 | 242.4 | 11% | 268.0 | 254.8 | 264.0 | 2% | 512.3 | 479.0 | 7% |
Flotation concentrate production, t | 159 | 11,671 | -99% | 7,323 | 23,219 | 30,023 | -99% | 11,830 | 56,208 | -79% |
Antimony in flotation concentrate, t | 0 | 1,919 | -100% | 1,837 | 3,950 | 2,432 | -100% | 1,919 | 5,171 | -63% |
Gold contained in concentrate, koz | 0.1 | 22.7 | -100% | 22.0 | 70.0 | 44.1 | -100% | 22.8 | 106.0 | -78% |
Total gold output, koz | 270.0 | 265.1 | 2% | 290.0 | 324.8 | 308.1 | -12% | 535.1 | 585.0 | -9% |
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Polyus Gold International Limited published this content on 12 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 August 2021 06:20:04 UTC.
