GV Gold reports 2016 financial and production results
On April 24, 2017, GV Gold (Vysochaishy, PJSC) published its IFRS financial results for 12 months ended on December 31, 2016. The consolidated financial statements were audited by BDO-Unicon, JSC.
Production Results
In 2016 GV Gold produced 5.1 t (164 koz) of gold: 4.8 t (154 koz) of gold were produced by the Irkutsk project assets, 0.3 t (10 koz) — by the Aldan project assets.
In connection with the gold price growth to the level of RUB 2,890/g (USD 1,175 /oz) in Q1 2016, the Company made a decision on scheduled processing of the low grade ore at the Irkutsk project — 1.33 g/t (-8%). Despite a 10 % decrease in the scopes of production, the profit margin of the production did not decrease and remained at the level of the previous year.
Financial Results
In 2016, the average RUB gold selling price increased from RUB 2,270 /g to RUB 2,689 /g (+18%), the average USD gold selling price increased from USD 1,158 /oz to USD 1,248 /oz (+8%).
In the reporting period, the revenue of GV Gold increased to RUB 13.7 billion (+7% as compared to 2015). The EBITDA increased by 7% to RUB 7.6 billion. The EBITDA margin remained at the level of 56%.
The net profit grew by 1.6 times and totaled RUB 6.4 billion.
The cost of sales grew by 10 % up to RUB 5.8 billion. The total cash costs increased up to RUB 1,201 /g (+21%).
The costs growth was explained by an increase of the services and equipment costs as well as by an increase of the mining operations scopes.
| Index | Units | 2016 | 2015 |
|---|---|---|---|
| Gold produced | kg | 5,096 | 5,641 |
| koz | 164 | 181 | |
| Gold sold | kg | 5,076 | 5,631 |
| koz | 163 | 181 | |
| Average gold selling price | RUB /g | 2,689 | 2,270 |
| USD /oz | 1,248 | 1,158 | |
| Proceeds from the sale of gold | RUB M | 13,647 | 12,784 |
| USD M | 204 | 209 | |
| Gross Profit | RUB M | 7,922 | 7,564 |
| Net Profit | RUB M | 6,414 | 4,089 |
| EBITDA | RUB M | 7,621 | 7,106 |
| USD M | 114 | 117 | |
| EBITDA Margin | % | 55.8 | 55.5 |
| Total cash outlay | RUB /g | 1,201 | 989 |
| USD /oz | 556 | 507 | |
| Net debt/EBITDA | х | 0.79 | 0.45 |
2017 Plans
In 2017, GV Gold will commission two new mines — Taryn and Ugakhan as well as the second large-capacity dredge will start working at the Bolshoi Kuranakh placer deposit.
The current production facilities will continue the operations aimed at the production efficiency improvement.