Polyus, Russia’s largest gold miner, reported a remarkable 183% increase in first-half profit, reaching $1.58 billion, despite facing Western sanctions. This surge was primarily driven by elevated global gold prices, which have reached record highs this year.
The company’s adjusted EBITDA rose 20% to $2.02 billion, with revenue increasing 16% to $2.73 billion. Polyus attributed this growth to higher average gold prices during the reporting period, with gold prices climbing approximately 22% year-to-date and peaking at $2,531.60 last week amid expectations of U.S. interest rate cuts and geopolitical tensions in the Middle East.
In the first half of 2024, Polyus’ gold output increased by 2% to 1.47 million ounces. The company has raised its production guidance for 2024 to between 2.75 and 2.85 million ounces, up from a previous forecast of 2.7 to 2.8 million ounces.
Despite sanctions imposed by the U.S. and Britain in 2023 due to Russia’s actions in Ukraine, Polyus is moving forward with its new flagship project, Sukhoi Log, located in Eastern Siberia. Pilot processing of ore from this site is set to begin in the latter half of the year, with full operations expected by 2027, which could potentially double the company’s gold output.
The Sukhoi Log project is estimated to contain 540 million tonnes of ore with 40 million ounces of gold. However, the project’s $3.3 billion costs are currently under review due to the impact of sanctions, with an update anticipated in the fourth quarter.