Polyus - 2Q19 IFRS Results In Line, Buy Reiterated
Polyus has reported 2Q19 IFRS results that were in line with our and the consensus estimates across the board. On the conference call, it reiterated its full-year guidance on production, costs and capex. We note that gold stocks retain safe-haven appeal amid the ongoing escalation in the US-China trade war and policy easing among global central banks. At the spot gold price and USD/RUB rate, Polyus is trading at a 2020E EV/EBITDA of 6.5, an 8% LFCF yield and a 6% dividend yield. We reiterate our BUY recommendation.
PJSC Polyus is an open joint stock company based in Russia. Co. is engaged in operations as a gold production company. Co.'s major assets are: in Krasnoyarsk region, Olympiada deposit as well as Blagodantoe, Titimukhta, Tyrada, Olenii, Razdolinskaya, Zyryanovskaya and Panimba fields; in Irkutsk region, Zapadnoe, Verninskoe, Pervenets, and Chertovo Koryto and Mukodek goldfields as well as some 94 placer deposits; in Magadan region, Natalka deposit and smaller Degdekan and Vostochnoye fields; in the Republic of Sakha (Yakutia), Kuranakh ore body and Kyutchus field as well as 50% interest in the giant Nezhdaninskoye field; and in Amur region, Bamskoe gold field.CJSC Deloitte & Touche CIS
Sberbank CIB Investment Research is a research firm offering equity, fixed income, economics, and strategy research. It covers analysis on all aspects of Russia’s capital markets, issues and industries. The firm analyzes trends in Russia and combines local knowledge with a global perspective. It processes macroeconomic data, market and company-specific news, stock quotes and other information for providing research reports. The firm provides details and latest prices on the most traded names and most traded paper on all segments Russian market. In strategy research, it provides thematic research, tips and descriptions of the methodology used to evaluate companies.
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