Slide 1: PJSC Polyus 1H 2016 Financial results
PJSC Polyus 1H 2016 Financial results
Slide 2: 1H 2016 key highlights
1H 2016 key highlights Lowest costs, sustained growth, high margins Continuing operational improvements Total gold output reached 839 koz, up 7% y-o-y Strong performance at Blagodatnoye, Verninskoye and Kuranakh reflecting steady growth in ore processing volumes and higher recoveries Average r
Slide 3: Financial results
Financial results cr rs) af
Slide 4: 1H 2016 financial highlights
Financial Results 1H 2016 financial highlights 1H16 1H15 change y-o-y FY15 Gold production, koz 839 784 7% 1,763 Average realised gold price excl. SPPP1, $/oz 1,223 1,202 2% 1,155 Average realised gold price incl. SPPP, $/oz 1,277 1,257 2% 1,221 Total cash cost (TCC), $/oz 377 436 (14%) 424 All-in-s
Slide 5: Revenue analysis
Financial Results Revenue analysis Sales by mine dynamics, koz1 Revenue breakdown by mine, 1H16, % 366 Other 348 Kuranakh 1% 9% Alluvials 4% 231 192 Verninskoye 11% 1H16 Olimpiada 100 42% 63 79 66 78 Titimukhta $1,082 mln 43 33 33 5% Blagodatnoye Olimpiada Blagodatnoye Titimukhta Verninskoye Alluvia
Slide 6: Adjusted EBITDA performance
Financial Results Adjusted EBITDA performance Adj. EBITDA and adj. EBITDA margin, 1H16 Adj. EBITDA bridge, $ mln 400 74% 80% 800 33 691 350 63% 64% 70% 700 61% 46 56% 593 19 300 286 60% 600 250 50% 500 222 200 40% 400 30% 150 30% 300 100 20% 200 74 54 50 36 10% 100 13 0 0% 0 Olimpiada Blagodatnoye T
Slide 7: TCC & AISC performance
Financial Results TCC & AISC performance TCC dynamics by mines, $/oz The Group’s TCC continued to demonstrate a decent 640 performance in 1H16 declining 14% y-o-y to $377/oz, the lowest 589 550 level since FY07 499 487 462 All mines managed to reduce TCC y-o-y due to the strong 429 416 407 396 3
Slide 8: Polyus TCC curve
Financial Results Polyus TCC curve Polyus TCC curve 1H16 800 TCC, $/oz 700 The average 1H16 TCC amounted to $377/oz 600 500 400 377 Alluvials Titimukhta Kuranakh Verninskoye Verninskoye 300 Titimukhta 200 Olimpiada Blagodatnoye 100 0 0 100 200 300 400 500 600 700 800 900 1000 Polyus cumulative produ
Slide 9: Polyus AISC curve
Financial Results Polyus AISC curve Polyus AISC curve 1H16 1200 AISC, $/oz 1000 43% of Polyus’ production was below AISC of $555/oz 800 The average 1H16 AISC amounted to $555/oz Alluvials 600 555 Kuranakh Verninskoye 400 Titimukhta Olimpiada 200 Blagodatnoye 0 0 100 200 300 400 500 600 700 800 900 1
Slide 10: Operating cash costs
Financial Results Operating cash costs The Group’s cash operating costs breakdown by item, 1H15/1H16, $ mln Outsourced mining services Other Other Outsourced mining services 1% Labour 8% 5% 1% 29% Power Power Labour 4% 5% 31% Fuel 10% Fuel 9% 1H15 A decline of 6% y-o-y in the 1H16 $353 mln Group’s c
Slide 11: Operating cash costs by BU
Financial Results Operating cash costs by BU Cost of sales breakdown by business unit, 1H16 Krasnoyarsk Verninskoye Kuranakh Alluvials Other Other Power Outsourced mining 5% 3% Labour 2% services 20% 8% Other Other 7% 15% Fuel Labour 12% Power Power 30% Labour Fuel Labour 4% 4% 35% 14% 33% Fuel 6% T
Slide 12: Cash flow dynamics
Financial Results Cash flow dynamics 1H16 cash flow bridge, $ mln 479 13 1,825 1,382 (967) 32 Dec 2015 Cash & CE Operating CF Investing CF Financing CF Forex June 2016 Cash & CE As of the end of 1H16 the Group’s cash and CE were $1,382 mln, down 24% as compared to the end of 2015, largely reflecti
Slide 13: Net working capital dynamics
Financial Results Net working capital dynamics 1H16 net working capital bridge, $ mln 16 16 13 475 40 412 22 Cash outflow $85 mln Dec 2015 NWC Inventories Deferred expenditures Receivables Payables Translation + non-OCF items June 2016 NWC The Group registered the $85 mln of OCF-related working ca
Slide 14: Capex analysis
Financial Results Capex analysis Capex1 breakdown, $ mln change 1H16 1H15 FY15 y-o-y Natalka 82 38 116% 111 Olimpiada 33 10 230% 39 Blagodatnoye 9 4 125% 13 Verninskoye 6 8 (25%) 21 Alluvials 11 3 267% 5 Titimukhta - - - 1 Kuranakh 12 2 N.M. 10 Exploration 3 1 200% 7 Other (incl. power projects) 30
Slide 15: Debt maturity profile
Financial Results Debt maturity profile Debt repayment schedule, $ mln 2,675 Total $2,060 mln 678 741 775 1 382 420 259 21 Total liquidity position 2016 2017 2018 2019 2020 2021+ Unused committed credit lines Cash & cash equivalents Debt repayments The Group’s cash and cash equivalents amounted to
Slide 16: Debt and cash structure
Financial Results Debt and cash structure The Group’s net debt amounted to ca. $3.5 bln, as opposed to $364 Cash/debt breakdown by currency, as of 1H16, % mln as of the end of FY15, despite a robust cash flow generation during Debt by currency* Cash by currency the period and reflecting the conduc
Slide 17: Strategic Price Protection Programme overview
Financial Results Strategic Price Protection Programme overview The RS structure until FY15 (2 tranches) The current RS structure (tranches 1-2) $1,720/oz Knock-in barrier $1,704/oz Knock-in barrier $1,603/oz $1,603/oz $1,528/oz $1,542/oz $1,491/oz $1,491/oz $1,377/oz $1,375/oz Strikes Strikes $1,10
Slide 18: Operating results
Operating results a, '~¢ cr rs)
Slide 19: Key highlights
Operational Performance Key highlights Sustained growth in refined gold production: 839.4 koz produced in 1H16 (+7% y-o-y) Significant y-o-y gold output increase at Blagodatnoye (+19%),Verninskoye (+27%) and Kuranakh (+18%) driven by significant increase in doré gold production progress reflecti
Slide 20: Olimpiada
Operational Performance Olimpiada y-o-y Operations 1H16 1H15 change TCC 1H14-1H16, $/oz Rock moved, kt 24,847 30,260 (18%) 611 Strip ratio, t/t 6.4 21.8 (71%) (3%) Ore mined, kt 3,372 1,327 154% 429 416 Grade in ore mined, g/t 3.32 2.59 28% Ore processed, kt 5,203 4,762 9% Grade in ore processed, g/
Slide 21: Blagodatnoye
Operational Performance Blagodatnoye y-o-y Operations 1H16 1H15 change TCC 1H14-1H16, $/oz Rock moved, kt 22,729 21,962 3% 499 Strip ratio, t/t 2.9 4.7 (38%) (21%) Ore mined, kt 5,785 3,823 51% 352 Grade in ore mined, g/t 2.00 1.93 4% 279 Ore processed, kt 3,822 3,527 8% Grade in ore processed, g/t
Slide 22: Titimukhta
Operational Performance Titimukhta y-o-y Operations 1H16 1H15 change TCC 1H14-1H16, $/oz 1,040 8,635 (88%) 1 275 Rock moved, kt Strip ratio, t/t 1.5 4.4 (66%) Ore mined, kt 412 1,614 (75%) (21%) Grade in ore mined, g/t 1.61 1.59 1% 499 Ore processed, kt 500 840 (41%) 396 Grade in ore processed, g/t
Slide 23: Verninskoye
Operational Performance Verninskoye y-o-y Operations 1H16 1H15 change TCC 1H14-1H16, $/oz Rock moved, kt 8,839 7,942 11% 716 Strip ratio, t/t 4.0 2.8 43% (12%) Ore mined, kt 1,765 2,067 (15%) 462 407 Grade in ore mined, g/t 2.15 2.02 6% Ore processed, kt 1,242 1,059 17% Grade in ore processed, g/t 2
Slide 24: Alluvials
Operational Performance Alluvials y-o-y Operations 1H16 1H15 change TCC 1H14-1H16, $/oz 832 Sands washed, km³ 2,069 2,626 -21% (7%) 589 550 Average grade, g/t 0.65 0.54 20% Gold production, koz 33.3 33.1 1% 1H14 1H15 1H16 Highlights 1H16 refined gold output at Alluvials increased by 1% y-o-y to 33
Slide 25: Kuranakh
Operational Performance Kuranakh y-o-y Operations 1H16 1H15 change TCC 1H14-1H16, $/oz Rock moved, kt 12,733 12,317 3% 970 Strip ratio, t/t 5.1 5.3 (4%) (24%) Ore mined, kt 2,085 1,959 6% 640 Grade in ore mined, g/t 1.30 1.32 (2%) 487 Ore processed, kt 2,062 1,898 9% Grade in ore processed, g/t 1.32
Slide 26: Appendix
Appendix af
Slide 27: Balance sheet highlights
Financial Statements Balance sheet highlights Assets, $ mln 1H 2016 FY 2015 1H 2015 Non-current assets 2,774 2,672 2,899 Property, plant and equipment 2,442 2,023 2,448 Derivative financial instruments and investments 32 411 148 Inventories 216 184 236 Deferred tax assets 62 46 62 Other 22 8 5 Curre
Slide 28: Balance sheet highlights (cont.)
Financial Statements Balance sheet highlights (cont.) Equity and Liabilities, $ mln 1H 2016 FY 2015 1H 2015 Share capital 7 7 7 Additional paid-in capital 2,279 2,273 2,266 Treasury shares (3,442) - - Cash flow hedge revaluation reserve 31 123 114 Translation reserve (2,686) (2,623) (2,050) Retained
Slide 29: Profit and loss statement highlights
Financial Statements Profit and loss statement highlights change $ mln 1H 2016 1H 2015 FY 2015 y-o-y Revenue from gold sales 1,069 1,005 6% 2,159 Other revenue 13 14 (7%) 29 Total revenue 1,082 1,019 6% 2,188 Cost of gold sales (379) (406) (7%) (876) Other cost of sales (12) (12) - (25) Total cost o
Slide 30: Cash flow highlights
Financial Statements Cash flow highlights $ mln 1H 2016 1H 2015 change y-o-y FY 2015 Profit before income tax 678 670 1% 1,212 Amortisation and depreciation 66 62 6% 128 Loss on derivative financial instruments and investments 142 (145) N.M. 125 Finance costs 73 40 83% 45 Interest income on bank dep
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