FINANCIAL HIGHLIGHTS
Revenue for the year ending 2014 was US$ 1,690 million, largely unchanged from 2013 ("year-on-year") despite average realised gold and silver prices decreasing 7% and 18% respectively year-on-year. The price decline was mostly offset by 7% increase in the volume of gold equivalent sold during the period.
Group Total cash cost ("TCC") was US$ 634/gold equivalent ounce ("GE oz"), down 15% from 2013 levels due to a robust operational performance, resulting in higher average grades processed and increased throughputs across the portfolio, coupled with significant Russian Rouble depreciation against the US dollar. Total cash costs in the second half of the year increased slightly by 2% to US$ 641/GE oz versus the first half of 2014 driven by production from Mayskoye with cost levels higher than the Group average.
All-in sustaining cash costs decreased by 18% year-on-year to US$ 893/GE oz as a result of reduction in total cash costs during the period, combined with increased production levels and associated reduction in per ounce sustaining capital expenditure at operating mines.
Adjusted EBITDA was US$ 685 million, an increase of 15% year-on-year, driven predominantly by strong cost performance and production growth offsetting the decline in commodity prices. Adjusted EBITDA margin was 41% compared to 35% in 2013.
Underlying net earnings for the year (adjusted for the after-tax amount of impairment charges/reversals and foreign exchange loss) were US$ 282 million (2013: US$ 179 million). As a result of non-cash foreign exchange losses, the Group recorded a net loss for the year of US$ 210 million in 2014 (2013: US$ 198 million).
Net debt of US$ 1,249 million (including the liability for the special dividend payable), an increase of 20% versus 2013 levels as the Company raised an additional US$ 318.5 million of debt for the acquisition of the Kyzyl gold project in Kazakhstan (completed on September 4, 2014), while continuing to generate free cash flow and pay dividends. Net debt/Adjusted EBITDA was 1.82 (31 December 2013: 1.75). Free cash flow for the year1 was US$ 306 million, an increase of more than two-fold compared to 2013.
A final dividend of US$ 0.13 per share representing 30% of the Group's underlying net earnings for 2H 2014 is proposed by the Board, which, in accordance with the current dividend policy, has the discretion to declare regular dividend at the Net debt/Adjusted EBITDA ratio above 1.75. This will bring total dividend declared for the period to US$ 0.41 per share, or US$ 173 million.
