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23 Jun, 2022 09:03 23 Jun, 2022 09:03

Polymetal cash-flow generation impacted by difficulties and delays in sales channels

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Polymetal InternationalCompany photo / Polymetal

Mining giant Polymetal International said on Thursday that both difficulties and delays in setting up new sales channels had continued, resulting in a drop in cash-flow generation.

Polymetal stated gold sales from its Russian mines to Asian markets returned to a regular schedule after a significant Covid-related slowdown in April and May, with sales terms remaining "broadly consistent" with those received earlier.

However, the London-listed firm highlighted that sales logistics continued to face "significant challenges" due to Covid-19 restrictions in China and the impact of Russian sanctions, leading to slower inventory turnover and higher selling costs, with the gap between production and sales and the resulting finished goods inventory expected to peak in September.

Net debt increased to $2.3bn as of 1 June, up from $2.0bn on 31 March, driven by a large working capital increase and accelerated procurement.

Polymetal stated it was "continuously" evaluating the stability, liquidity, and solvency of the business in light of "multiple external uncertainties" but added that its operations in Russia and Kazakhstan continued undisrupted and maintained its full-year production guidance of 1.7m ounces for 2022.

As of 0900 BST, Polymetal shares were up 3.36% at 186.0p.

Reporting by Iain Gilbert at Sharecast.com


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Pilling and Co Stockbrokers Ltd. is not responsible for the content or accuracy of third party news articles and we may not share the views of the author or publisher.

We provide third party news for your convenience and information only and make no representation or endorsement whatsoever and hereby exclude all liability for any loss or damage that may be incurred by you as a result of your access or use. Please note that third party content may be subject to terms and conditions imposed by the third party owner of that content.

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