Slide 1: PJSC Polyus 3Q 2017 Financial results
PJSC Polyus 3Q 2017 Financial results
Slide 2: 3Q 2017 key highlights
3Q 2017 key highlights Continued strong top-line performance Gold sales increased 10% y-o-y to 578 koz. Revenue amounted to $744 mln, compared to $706 mln in 3Q 2016, due to a higher sales volume. Superior profitability profile The Group’s TCC decreased 6% y-o-y to $380/oz, AISC increased 7% y
Slide 3: Financial results
Financial results a, '~¢
Slide 4: 3Q 2017 financial highlights
Financial Results 3Q 2017 financial highlights Key highlights 3Q 2017 3Q 2016 Y-o-Y 9M 2017 9M 2016 Y-o-Y Gold production, koz 642 555 16% 1,580 1,395 13% Average realised refined gold price excl. SPPP, $/oz 1,279 1,335 (4%) 1,254 1,265 (1%) Average realised refined gold price, incl. SPPP, $/oz 1,27
Slide 5: Revenue analysis
Financial Results Revenue analysis Sales by mine dynamics, koz Revenue breakdown by mine, 3Q 2017, % 300 281 3Q 2016 Other Kuranakh 3Q 2017 1% 7% 228 250 Alluvials 200 15% 150 116 116 3Q 2017 Olimpiada Verninskoye 48% 100 9% $744 mln 100 85 53 50 43 40 43 Krasnoyarsk cluster 68% Blagodatnoye 0 20% O
Slide 6: TCC & AISC performance
Financial Results TCC & AISC performance TCC dynamics by mines, $/oz AISC dynamics by mines, $/oz 719 700 900 840 751 725 708 800 600 514 526 700 472 574 563 594 500 429 539 552 406 600 375 470 400 334 333 500 300 400 300 300 200 200 100 100 0 0 Olimpiada Blagodatnoye Verninskoye Alluvials Kuranakh
Slide 7: Polyus TCC curve
Financial Results Polyus TCC curve Polyus TCC curve in 3Q 2017 TCC, $/oz 800 700 The average 3Q 2017 TCC amounted to 380$/oz 600 $380/oz 500 400 Verninskoye Kuranakh 300 Alluvials 200 Blagodatnoye Olimpiada 100 0 Polyus cumulative production, koz 0 100 200 300 400 500 600 Highlights Global TCC curve
Slide 8: Polyus AISC curve
Financial Results Polyus AISC curve Polyus AISC curve in 3Q 2017 AISC, $/oz 800 The average 3Q 2017 AISC amounted to 599$/oz 700 $599/oz 600 500 Kuranakh Verninskoye 400 Alluvials 300 Olimpiada Blagodatnoye 200 100 0 Polyus cumulative production, koz 0 100 200 300 400 500 600 Highlights Global AISC
Slide 9: Operating cash costs
Financial Results Operating cash costs The Group’s cash operating costs breakdown by item, 3Q 2016 / 3Q 2017 Outsourced mining services Other Other Outsourced mining services 2% Labour 9% 7% 2% Power 35% Labour 2% Power 1% 29% Fuel 10% Fuel 9% An increase of 7% y-o-y in the 3Q 2016 3Q 2017 Group’s c
Slide 10: Adjusted EBITDA performance
Financial Results Adjusted EBITDA performance Adj. EBITDA and adj. EBITDA margin, 3Q 2017 Adj. EBITDA bridge, $ mln 300 80% 70% 600 69% 62% 70% 250 51% 60% 500 68 19 (21) 475 200 50% 400 444 39% (35) 40% 150 300 30% 244 100 20% 200 10% 50 104 100 0 42 43 30 - (10%) - Olimpiada Blagodatnoye Verninsko
Slide 11: Cash flow dynamics
Financial Results Cash flow dynamics 9M and 3Q 2017 cash flow bridge, $ mln 250 0.0 550 200 0.0 (206) 398 150 0.0 1,740 6 (217) (613) 1,477 6 (543) 100 0.0 1,121 500 .0 - Cash & CE Operating CF Investing CF Financing CF Effect of foreign Cash & CE Operating CF Investing CF Financing CF Effect of for
Slide 12: Net working capital dynamics
Financial Results Net working capital dynamics 3Q 2017 net working capital bridge, $ mln 620 Cash outflow $29 mln 46 610 17 600 590 (13) (21) 580 (17) 570 578 560 550 566 540 30-Jun-17 NWC Inventories Deferred expenditures Receivables Payables Translation + 30-Sep-17 NWC non-OCF items The Group re
Slide 13: Capex analysis
Financial Results Capex analysis Capex breakdown, $ mln $ million 3Q 2017 3Q 2016 Y-o-Y 9M 2017 9M 2016 Y-o-Y Natalka 126 47 168% 305 129 136% Olimpiada 41 17 141% 93 50 86% Blagodatnoye 17 5 240% 30 14 114% Verninskoye 11 8 38% 23 14 64% Alluvials 5 5 - 17 16 6% Kuranakh 17 6 183% 39 18 117% Explor
Slide 14: Natalka
Financial Results Natalka In June-July 2017, Polyus conducted preparatory works for hot commissioning of the project. In September, the hot commissioning of Natalka was launched by Russian President Vladimir Putin. Current status: The primary crusher, the main SAG mill and the main ball mill
Slide 15: Debt maturity profile as of the end of 3Q 2017
Financial Results Debt maturity profile as of the end of 3Q 2017 Polyus has comfortable debt maturity profile and proactively manages upcoming redemptions. As of the end of 3Q 2017, the debt portfolio is represented by $1.25 bln Sberbank loan (2023), Eurobonds (2020, 2022 & 2023) in the overall
Slide 16: Debt structure and interest rate dynamics
Financial Results Debt structure and interest rate dynamics1 Debt breakdown Debt breakdown Debt breakdown by source by interest rates by currency2 Bank loans $1.25 bln Floating (17%) Sberbank loan (2023) rate (29%) 33% RUB 22% RUB bonds (6%) Fixed rate 67% USD Eurobonds 78% (48%) Debt outstanding an
Slide 17: Net debt position
Financial Results Net debt position By the end of 3Q 2017, the Group’s net debt stood at $3,151 mln, up 2% from $3,084 mln as of 30 June 2017. The net debt/adjusted EBITDA ratio as of 30 September 2017 remained stable at the level of 1.9x, as an increase in the net debt position was fully offset
Slide 18: Operating results
Operating results a, '~¢
Slide 19: Operational Performance: Key highlights
Operational Performance Key highlights In 3Q 2017, total gold output increased 16% y-o-y to 642 koz reflecting the strong performance at Olimpiada, Verninskoye and Kuranakh. Meanwhile, recoveries in 3Q 2017 reduced 0.5 ppts y-o-y to 83.8% mainly due to lower recoveries at Olimpiada on the back o
Slide 20: Olimpiada
Operational Performance Olimpiada Operations 3Q'17 3Q'16 Y-o-Y 9M'17 9M'16 Y-o-Y TCC 3Q 2016 – 3Q 2017, $/oz Total rock moved, kt 20,812 12,251 70% 51,958 37,098 40% Stripping ratio, t/t 5.9 4.6 26% 4.8 5.7 (17%) (22%) Ore mined, kt 3,035 2,170 40% 9,035 5,542 63% Grade in ore mined, g/t 4.19 3.34 2
Slide 21: Blagodatnoye
Operational Performance Blagodatnoye Operations 3Q'17 3Q'16 Y-o-Y 9M'17 9M'16 Y-o-Y TCC 3Q 2016 – 3Q 2017, $/oz Total rock moved, kt 20,495 14,242 44% 55,468 36,971 50% Stripping ratio, t/t 4.9 3.9 26% 5.0 3.3 53% 11% Ore mined, kt 3,477 2,907 20% 9,264 8,693 7% Grade in ore mined, g/t 1.90 2.01 (6%
Slide 22: Verninskoye
Operational Performance Verninskoye Operations 3Q'17 3Q'16 Y-o-Y 9M'17 9M'16 Y-o-Y TCC 3Q 2016 – 3Q 2017, $/oz Total rock moved, kt 4,629 3,804 22% 13,874 12,642 10% Stripping ratio, t/t 4.5 4.7 (5%) 4.0 4.2 (4%) 8% Ore mined, kt 846 666 27% 2,765 2,431 14% Grade in ore mined, g/t 2.36 2.24 6% 2.22
Slide 23: Alluvials
Operational Performance Alluvials Operations 3Q'17 3Q'16 Y-o-Y 9M'17 9M'16 Y-o-Y TCC 3Q 2016 – 3Q 2017, $/oz Sands washed, 000 m³ 4,999 5,296 (6%) 7,250 7,365 (2%) 40% Average grade, g/m³ 0.55 0.61 (9%) 0.55 0.62 (12%) 719 Gold in slime, koz 88.9 103.6 (14%) 127.1 146.8 (13%) Refined gold output, ko
Slide 24: Kuranakh
Operational Performance Kuranakh Operations 3Q'17 3Q'16 Y-o-Y 9M'17 9M'16 Y-o-Y TCC 3Q 2016 – 3Q 2017, $/oz Total rock moved, kt 8,836 6,410 38% 24,157 19,091 27% Stripping ratio, t/t 4.2 5.0 (15%) 4.3 5.0 (15%) (10%) Ore mined, kt 1,698 1,074 58% 4,554 3,159 44% Grade in ore mined, g/t 1.16 1.30 -1
Slide 25: Natalka
Operational Performance Natalka Operations 3Q'17 3Q'16 Y-o-Y 9M'17 9M'16 Y-o-Y Total rock moved, kt 6,772 - N.A. 15,308 421 N.A. Stripping ratio, t/t 8.0 - N.A. 6.7 0.6 N.A. Ore mined, kt 752 - N.A. 1,997 255 N.A. Grade in ore mined, g/t 1.01 - N.A. 0.95 1.20 (20%) Ore processed, kt 2 13 (81%) 35 29
Slide 26: Appendix
Appendix af
Slide 27: Balance sheet highlights
Financial Statements Balance sheet highlights Assets, $ mln 30 September 2017 31 December 2016 Non-current assets 4,250 3,371 Property, plant and equipment 3,701 2,938 Derivative financial instruments and investments 30 57 Inventories 300 264 Deferred tax assets 77 75 Assets classified as held for s
Slide 28: Balance sheet highlights (cont.)
Financial Statements Balance sheet highlights (cont.) Equity and Liabilities, $ mln 30 September 2017 31 December 2016 Share capital 5 7 Additional paid-in capital 1,945 2,288 Treasury shares (89) (3,712) Cash flow hedge revaluation reserve - 12 Translation reserve (2,729) (2,720) Retained earnings
Slide 29: Profit and loss statement highlights
Financial Statements Profit and loss statement highlights $ mln 3Q 2017 3Q 2016 Y-o-Y 9M 2017 9M 2016 Y-o-Y Gold sales 733 700 5% 1,950 1,769 10% Other revenue 11 6 83% 28 19 47% Total revenue 744 706 5% 1,978 1,788 11% Cost of gold sales (264) (253) 4% (719) (632) 14% Other cost of sales (9) (7) 29
Slide 30: Cash flow highlights
Financial Statements Cash flow highlights 3Q 2017 3Q 2016 Y-o-Y 9M 2017 9M 2016 Y-o-Y Profit before income tax 446 480 (7%) 1,146 1,158 (1%) Finance costs, net 43 32 34% 151 105 44% Interest income (6) (12) (50%) (23) (30) (23%) Unrealised gain / (loss) on investments and revaluation of derivative f
Slide 31: Disclaimer
Disclaimer The information contained herein has been prepared using information available to PJSC Polyus (“Polyus”) at the time of preparation of the presentation. External or other factors may have impacted on the business of Polyus and the content of this presentation, since its preparation. In ad