Mining Roundup: Polymetal Share Price Plunges on H1 Loss

on Aug 28, 2013
Listen Wednesday, August 28th: Shares in Russia’s largest silver producer Polymetal International (LON:POLY) today plunged more than eight percent, after the precious metals miner posted a first-half net loss, hit by impairment charges and a decline in commodity prices.

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According to its interim report, Polymetal, part-owned by Russian billionaire Alexander Nesis, swung to a net loss of $255 million in the first six months of 2013, from a net profit of $157 million in the same period a year earlier. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) were $239 million, a decrease of 38 percent. Revenue declined by six percent to $721 million from $767 million.

The disappointing half-year performance was mainly the result of a decline in precious metals prices. Polymetal’s average achieved gold price fell 13 percent to $1,422 per ounce, and silver price slid 18 percent to $24.2 per ounce. The declines were partially offset by an eight percent growth in the volume of gold equivalent sold.
The H1 2013 results also included non-cash impairment charges of $305 million on a pre-tax basis, mainly due to the write-off of goodwill and mining assets at Varvara, Khakanja and low-grade ore stockpiles at Omolon.

Polymetal’s board declared an interim dividend of $0.01 per share, representing 30 percent of underlying net earnings of $17 million for the period.
**As of 12:35 BST buy Polymetal shares at £683.50p.**
**As of 12:35 BST sell Polymetal shares at £681.50p.**
**Grupo Mexico to Postpone London IPO**
Grupo Mexico SAB, billionaire German Larrea’s holding company, is delaying a planned initial public offering of its mining unit, Bloomberg reported today, quoting inside sources.

In March, Grupo Mexico’s Chief Financial Officer Daniel Muniz said that the company may sell as much as 25 percent of its Americas Mining unit in a share sale in London. The move has been postponed by the company, according to three inside sources, who added that an IPO was unlikely until at least next year.
!m[Grupo Mexico’s Mining Unit to Delay London IPO ](/uploads/story/5153/thumbs/pic1_inline.jpg)

Grupo Mexico tabled the offering of the division after the price of copper and emerging-market stocks dropped. Copper futures have fallen nine percent so far this year to $3.3225 a pound on the Comex in
New York, while the MSCI Emerging Markets Index has dropped 13 percent in the year to date.
An e-mail and call seeking comment went unanswered by Muniz, Bloomberg said.
**Mining Stocks Fall amid Syria Concerns**
London-listed mining stocks today fell amid rising geopolitical tensions in the Middle East. BHP Billiton (LON:BLT) and Rio Tinto (LON:RIO), the world’s biggest mining companies, led the declines, both sliding more than 1.5 percent. Petrofac (LON:PFC) was the only mining group, whose shares traded higher. The stock jumped 4.5 percent after the company yesterday reported better-than-expected first-half profit and increased its dividend.

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