For the six months ended 30 June, the FTSE 250 firm reported adjusted earnings (EBITDA) of US$403mln, 34% higher year-on-year, while revenues jumped 20% to US$946mln.
The increase was mostly attributed to a 22% rise in gold equivalent production, while sales advanced 36% to 604 kilo-ounces, offsetting a 15% decline in silver sales to 10.3mln ounces, in line with production volume dynamics.
As a result of the improved performance, Polymetal upped its proposed interim dividend by 18% to 20 cents a share.
Looking ahead, the company said it remained “on track” to meet its 2019 production guidance of 1.55mln ounces of gold equivalent.
Vitaly Nesis, Polymetal’s chief executive, said the strong uptick in earnings reflected “solid operational delivery”, particularly from the company’s flagship Kyzyl project in Kazakhstan.
He added that the firm expected “seasonally lower costs, higher production and materially stronger cash flow generation” in its second half which would allow it to meet its full-year production targets.
The news sent the shares up 2.1% to 1,139.5p in mid-morning trading.
RBC ups target despite “small miss” to forecasts
In a note, analysts at RBC upped their target price for Polymetal to 1,200p from 1,100p and reiterated their ‘outperform’ rating on the stock, despite what they said was a “small miss” to their first-half forecasts.
The Canadian bank said the group’s adjusted EBITDA was around 2% lower than consensus, however, they added that this was “not too concerning” given expectations of a stronger second half and continually “strong” gold prices, which has risen around 7.7% to US$1,530.9 an ounce in the last six months.
RBC added that the group’s “solid” interim dividend put it on track to deliver a 4% full-year yield if current spot prices persisted.