May 10, 2017 / 10:05 AM / 3 months ago

Russia's Polyus first-quarter net profit steady

MOSCOW, May 10 (Reuters) - Polyus Gold, Russia's largest gold producer, reported $203 million in adjusted first-quarter net profit on Wednesday, little changed from a year earlier due to higher debt servicing charges.

Polyus, controlled by the family of Russian tycoon Suleiman Kerimov, is in talks to sell a stake to a consortium led by China's Fosun International Ltd and is also considering a secondary share offering.

Including foreign exchange gains, one-off items and other financial instruments, the company's profit jumped 70 percent to $499 million while revenue climbed 19 percent to $609 million.

In the first quarter last year, Polyus had adjusted net profit of $201 million.

Polyus said its net debt fell to $3.13 billion at the end of March from $3.24 billion at the end of 2016 after it sold its stake in a gold asset, though higher debt service charges than in the first-quarter of 2016 weighed on net profit.

It did not give details of its debt service charges. Earlier this year, Polyus raised $800 million with a six-year Eurobond.

The company's main greenfield project is the large Natalka gold deposit in the east of Russia, which it plans to launch by the end of 2017. It also acquired the giant and largely untapped Sukhoi Log gold deposit in Russia earlier this year.

The company said its capital expenditure was up by a third to $128 million in the first quarter, mainly driven by the ongoing work at the Natalka gold deposit. (Reporting by Katya Golubkova; editing by David Clarke)

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