OREANDA-NEWS. Polymetal International plc is pleased to announce the Group's preliminary results for the year ended 31 December 2015.

Polymetal has delivered a solid set of operating and financial results. The original production guidance was exceeded by 4% while operating costs and capital expenditures for the year were below original guidance.

Revenue for the year ending 2015 decreased by 15% to US$ 1,441 million ("year-on-year") as a result of average realised gold and silver prices decreasing by 8% and 17% respectively year-on-year. Gold sales were 864 Koz, down 8% year-on-year while silver sales were 31.2 Moz, up 6% year-on-year, in line with production volume dynamics.

Group Total cash cost1 ("TCC") was US$ 538/gold equivalent ounce ("GE oz"), down 15% from 2014 levels and below original guidance of US$ 575-625/GE oz driven by significant Russian Rouble depreciation against the US Dollar, which more than offset the combined negative impact of domestic inflation and change in the gold/silver price ratio. Total cash costs in the second half of the year decreased by 4% to US$ 529/GE oz versus the first half of 2015 driven by a strong operational performance at Dukat, Omolon and Albazino.

All-in sustaining cash costs ("AISC) decreased by 18% year-on-year to US$ 733/GE oz and were below original guidance of US$ 750-800/GE oz primarily as a result of decline in total cash costs during the period, and other expenditures significantly influenced by Rouble and Tenge's devaluation.

Adjusted EBITDA was US$ 658 million, a decrease of just 4% year-on-year despite the revenue decline which was largely offset by a strong cost performance. Adjusted EBITDA margin was 46% compared to 41% in 2014.

Net earnings were US$ 221 million versus a US$ 210 million loss in 2014. Underlying net earnings (adjusted for the after-tax amount of impairment charges/reversals and foreign exchange loss) were US$ 296 million (2014: US$ 282 million), up 5% year-on-year, driven by depreciation of local currencies.

Capital expenditure was US$ 205 million, below the original guidance of US$ 240 million, as a result of currency devaluation .The Group is on track on construction at Kyzyl and Svetloye projects.

The Company continued to generate significant free cash flow1, which was US$ 263 million in 2015 (2014: US$ 306 million).

On the back of robust cash flow generation for the year, the Company paid out US$ 127 million of special dividends to shareholders, bringing the total amount of dividends declared during 2015 to US$ 216 million.

Net debt at 31 December 2015 was US$ 1,298 million, an increase of 4% year-on-year, mainly as a result of the net settlement of the Kyzyl put option in September 2015 and other cash-based acquisitions. The Group maintains a comfortable Net debt/ Adjusted EBITDA ratio of 1.97x.

A final dividend of US$ 0.13 per share (approx. US$ 55 million) representing 30% of the Group's underlying net earnings for 2H 2015 is proposed by the Board, which, in accordance with the current dividend policy, has the discretion to declare regular dividend at the Net debt/Adjusted EBITDA ratio above 1.75.

Polymetal reports another year of strong operational delivery. Gold equivalent production for the year (based on the new 1:80 Ag/Au conversion ratio1) comprised 1.27 Moz and exceeded the original production guidance for 2015 by 4%.

Gold production was 861 Koz, down 9% year-on-year, while silver production was 32.1 Moz, an increase of 12% compared to 2014. Gold sales were 864 Koz, down 8% year-on-year while silver sales were 31.2 Moz, up 6% year-on-year, in line with production dynamics and volume.

The Company's health and safety performance has deteriorated in 2015. In response, the Board has established a new Safety and Sustainability Committee, and both the Board and management are determined to improve this situation in 2016.

The Company reconfirms its production guidance for 2016 (1.23 Moz of gold equivalent) and 2017 (1.30 Moz of gold equivalent).

Taking into account the continued volatility of both the Russian Rouble and Kazkah Tenge as well as commodity prices, total cash cost guidance for 2016 is maintained at US$ 525-575/GE oz and all-in sustaining cash costs of US$ 700-750/GE oz.