Polymetal: Report on payments to governments fo...

Polymetal International plc (POLY) Polymetal: Report on payments to governments for the year 2018 14-Jun-2019 / 09:00 MSK Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement. Release time IMMEDIATE                     LSE, MOEX, AIX: POLY / ADR: AUCOY Date 14 June 2019     Polymetal International plc Report on payments to governments for the year 2018   Polymetal issues the report on payments to government for the year ended 31 December 2018. INTRODUCTION This Report provides an overview of the payments to governments made by Polymetal International plc and its subsidiary undertakings (hereinafter referred to as "Polymetal") for the year 2018 as required under the UK's Report on Payments to Governments Regulations 2014 (as amended in December 2015). These UK Regulations enact domestic rules in line with Directive 2013/34/EU (the EU Accounting Directive (2013)) and apply to large extractive companies, whose securities are publicly listed on a UK-regulated stock market,  that are involved in the exploration, prospection, discovery, development and extraction of minerals, oil, natural gas deposits or other materials. This Report is also intended to satisfy the requirements of the Disclosure and Transparency Rules of the Financial Conduct Authority in the United Kingdom. BASIS OF PREPARATION Legislation This report is prepared in accordance with The Reports on Payments to Governments Regulations 2014 as enacted in the UK in December 2014 and as amended in December 2015. Reporting entities This Report includes payments to governments made by Polymetal plc and its subsidiary undertakings (Polymetal). Payments made by entities over which Polymetal has joint control or significant influence are excluded from this Report. Activities Payments made by Polymetal to governments arising from activities involving the exploration, prospection, discovery, development and extraction of minerals are disclosed in this Report. It excludes payments related to refining activities made to the refineries owned by the government agencies and any payments which are not directly attributable to the production and exploration activities. Government Government includes any national, regional or local authority of a country, and includes a department, agency or entity that is a subsidiary of a government. Project Payments are reported at project level except that payments that are not attributable to a specific project are reported at legal entity level. Project is defined as operational activities which are governed by a single contract, or licence agreement, and form the basis for payment liabilities with a government. If such agreements are substantially interconnected, those agreements are to be treated as a single project. "Substantially interconnected" means forming a set of operationally and geographically integrated contracts, or licence agreements that are signed with a government giving rise to payment liabilities. Indicators of integration include, but are not limited to, geographic proximity, the use of shared infrastructure and common operational management. License agreements are aggregated for the purposes of reporting as a single project only when those legal agreements have substantially similar terms and are both geographically and operationally integrated. Payments The information is reported under the following payment types:   Income taxes These are taxes paid by Polymetal on its income and profits in accordance with legislation enacted in the applicable jurisdiction. Payments are reported net of refunds. Value added tax, personal income taxes, social taxes, property taxes are excluded. The maximum income tax rate in Russia is set at 20% and is allocated between federal budget and the budgets of the relevant constituent regions. In 2018 and 2017 the following proportion was applied: 3% was remitted to the federal budget, whereas 17% were allocated to the regional budgets. From 1 January 2017 Omolon Gold Mining Company LLC and Magadan Silver JSC are entitled to the decreased statutory income tax rate of 17% for the operations held in the Special Economic Zone of the Russian Far East, as well as decreased mining tax rate (paying at 60% of the standard mining tax rates). In return for obtaining this tax relief the members of the regional special economic zone are obliged to invest 50% of their tax savings each year in the Special Economic Zone Development Program.  From 1 January 2017, Svetloye LLC has received tax relief as Regional Investment Project and is entitled to the statutory income tax rate of 0% up to 2021, as well as to decreased mining tax rates. In Kazakhstan and Armenia income taxes are set at 20% and there are no regional or local income taxes in these countries. Mining tax Mining tax is a royalty payable in Russian Federation, Kazakhstan and Armenia, which is calculated based on the value of the precious metals extracted in the period. This value is usually determined based on the realised selling price of precious metals or, in case if there were no sales during the period, cost of production of metals extracted (Russian Federation) or the average market price (Kazakhstan) during the period. Royalty payable in Armenia is calculated as a percentage of actual sales during the reporting period. Mining tax in Russia is levied at federal level, and is then reallocated between federal and respective regional budgets based on the following proportion: 40% of total tax collected to the federal budget, 60% to regional budgets. Mining tax and royalties in Kazakhstan and Armenia are levied at central government level. Licence fees These are fees and other sums paid as consideration for acquiring a licence for gaining access to an area where extractive activities are performed. Administrative government fees that are not specifically related to the extractive sector, or to access to extractive resources, are excluded. No significant licence fees individually more than 86,000 GBP were paid during the year ended 31 December 2018. Rental fees The land in the Russian Federation and Kazakhstan on which the Group's production facilities are located is owned by the state. The Group leases this land through operating lease agreements. Other payments Other payments include payments made and social commitments in accordance with subsoil contracts attributable to the Kyzyl project and investment in the Special Economic Zone Development Program of Omolon Gold Mining Company LLC and Magadan Silver JSC. Cash and in-kind payments Payments are reported on cash basis. No in-kind payments were made during years ended 31 December 2018 and 31 December 2017. Materiality Level Any payment, whether made as a single payment or as a series of related payments, below GBP 86,000 within a financial year is excluded from this Report. Payments made to governments by a joint ventures or associates of the Group in proportion to the company's interest in the respective venture or associate are insignificant to this Report based on materiality level set. Exchange Rate Relevant payments are made by Polymetal in Russian Rubles, Kazakh Tenge and Armenian Dram and for the purpose of this Report are translated to the US Dollar based on the foreign exchange rate at the relevant monthly average rate. PAYMENTS PER GOVERNMENT                 FOR THE YEAR 2018                                       Government          000'$       Income tax Mining tax Rental fees Licence fees Other1 Total                     Russia                                    94,652                             68,408                                       2,161                             130                                    9,643                    174,994   Kazakhstan                                      9,611                             15,898                                            60                                   -                                    5,425                       30,994   Armenia                                         388                             13,241                                          228                                   -                                         12                       13,869   Total                                 104,651                             97,547                                       2,449                             130                                 15,080                    219,857                       PAYMENTS PER PROJECT1                                       Entity                   000'$ Project Country/ Government Region Income tax Mining tax Rental fees Licence fees Other1 Total                     Gold of Northern Urals CJSC Voro Russia Svedlovskaya oblast'                              25,962                               8,180                                            83                                   -                                         79                       34,304   Okhotskaya Mining and Exploration Company LLC Okhotsk Russia Khabarovskiy Kray                                8,328                               5,751                                          301                                34                                         42                       14,456   Svetloye LLC Svetloye Russia Khabarovskiy Kray                                         -                                            290                                  3                                         33                            326   Magadan Silver JSC Dukat Russia Magadanskaya oblast'                              34,420                             14,527                                          604                                45                                    5,111                       54,707   Mayskoye Gold Mining Company LLC Mayskoye Russia Chukotka Autonomous Okrug                             12,322                                               6                                           25                       12,353   Omolon Gold Mining Company LLC Omolon Russia Magadanskaya oblast'                                6,929                               8,603                                          403                                31                                    4,230                       20,196   Albazino Resources Ltd Albazino Russia Khabarovskiy Kray                              19,013                             19,025                                          474                                17                                       123                       38,652   Varvarinskoye JSC Varvara Kazakhstan n/a                                4,701                               2,370                                            11                                   -                                       444                         7,526   Komarovskoye Mining Company LLC Komar Kazakhstan n/a                                3,004                               5,333                                            11                                   -                                       467                         8,815   Bakyrchik Mining Venture LLC Kyzyl Kazakhstan n/a                                1,906                               8,195                                            34                                   -                                    4,489                       14,624   Inter Gold Capital LLC Kazakhstan n/a                                         -                                        -                                               4                                   -                                         25                               29   Kapan MPC CJSC Kapan Armenia n/a                                   388                             13,241                                          228                                   -                                         12                       13,869   Total                                 104,651                             97,547                                       2,449                             130                                 15,080                    219,857   ______________________ 1 Includes payments under Special Economic Zone Development Program of kUS$ 4,172 for Omolon Gold Mining Company LLC and kUS$ 4,979 for Magadan Silver JSC.   PAYMENTS PER GOVERNMENT                 FOR THE YEAR 2017                                       Government          000'$       Income tax Mining tax Rental fees Licence fees Other1 Total                     Russia       79,692   61,728   2,096            31   18,267    161,814   Kazakhstan       12,960   8,911   61   -   4,370   26,302   Armenia       -   3,961   222   -   1,302   5,485   Total       92,652   74,600       2,379   31                                 23,939                    193,601                      PAYMENTS PER PROJECT1                                       Entity                   000'$ Project Country/ Government Region Income tax Mining tax Rental fees Licence fees Other1 Total                     Gold of Northern Urals CJSC Voro Russia Svedlovskaya oblast'                             23,305                               8,102                                            98                                  5                                         65                      31,575   Okhotskaya Mining and Exploration Company LLC Okhotsk Russia Khabarovskiy Kray                                9,211                               7,382                                          287                                  2                                         34                      16,916   Svetloye LLC Svetloye Russia Khabarovskiy Kray -   -   217   -       14         231   Magadan Silver JSC Dukat Russia Magadanskaya oblast'                             21,548                               8,814                                          655                                13                                 14,172                      45,202   Mayskoye Gold Mining Company LLC Mayskoye Russia Chukotka Autonomous Okrug -                               9,644                                               -   -                                         28                         9,672   Omolon Gold Mining Company LLC Omolon Russia Magadanskaya oblast'                             14,587                               9,715                                          403                                  9                                   3,890                      28,604   Albazino Resources Ltd Albazino Russia Khabarovskiy Kray 11,041   18,071   436   2   64   29,614   Varvarinskoye JSC Varvara Kazakhstan n/a 9,803   3,370   11   -   511   13,695   Komarovskoye Mining Company LLC Komar Kazakhstan n/a 2,637   5,527   11   -   307   8,482   Bakyrchik Mining Venture LLC Kyzyl Kazakhstan n/a 484   14   36   -   3,522   4,056   Inter Gold Capital LLC Kazakhstan n/a 36   -           3   -   30    69   Kapan MPC CJSC Kapan Armenia n/a -   3,961   222   -   1,302   5,485   Total                                   92,652                            74,600                                      2,379                                31                                 23,939                    193,601   ______________________ 1 Includes payments under Special Economic Zone Development Program of kUS$ 3,822 for Omolon Gold Mining Company LLC and kUS$ 13,952 for Magadan Silver JSC. About Polymetal   Polymetal International plc (LSE, MOEX, AIX: POLY, ADR: AUCOY) (together with its subsidiaries - "Polymetal", the "Company", or the "Group") is a top-20 global gold producer and top-5 global silver producer with assets in Russia and Kazakhstan. The Company combines strong growth with a robust dividend yield. Enquiries Media   Investor Relations FTI Consulting Leonid Fink Viktor Pomichal [phone] Polymetal Eugenia Onuschenko Timofey Kulakov Michael Vasiliev                   [e-mail] [phone] (UK)   [phone] (Russia) Joint Corporate Brokers   Morgan Stanley Andrew Foster Richard Brown Panmure Gordon Charles Lesser James Stearns [phone]       [phone] RBC Europe Limited Marcus Jackson Jamil Miah [phone]   FORWARD-LOOKING STATEMENTS THIS RELEASE MAY INCLUDE STATEMENTS THAT ARE, OR MAY BE DEEMED TO BE, "FORWARD-LOOKING STATEMENTS". THESE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS AT THE DATE OF THIS RELEASE. THESE FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY, INCLUDING THE WORDS "TARGETS", "BELIEVES", "EXPECTS", "AIMS", "INTENDS", "WILL", "MAY", "ANTICIPATES", "WOULD", "COULD" OR "SHOULD" OR SIMILAR EXPRESSIONS OR, IN EACH CASE THEIR NEGATIVE OR OTHER VARIATIONS OR BY DISCUSSION OF STRATEGIES, PLANS, OBJECTIVES, GOALS, FUTURE EVENTS OR INTENTIONS. THESE FORWARD-LOOKING STATEMENTS ALL INCLUDE MATTERS THAT ARE NOT HISTORICAL FACTS. BY THEIR NATURE, SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER IMPORTANT FACTORS BEYOND THE COMPANY'S CONTROL THAT COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON NUMEROUS ASSUMPTIONS REGARDING THE COMPANY'S PRESENT AND FUTURE BUSINESS STRATEGIES AND THE ENVIRONMENT IN WHICH THE COMPANY WILL OPERATE IN THE FUTURE. FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE. THERE ARE MANY FACTORS THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN SUCH FORWARD-LOOKING STATEMENTS. THE COMPANY EXPRESSLY DISCLAIMS ANY OBLIGATION OR UNDERTAKING TO DISSEMINATE ANY UPDATES OR REVISIONS TO ANY FORWARD-LOOKING STATEMENTS CONTAINED HEREIN TO REFLECT ANY CHANGE IN THE COMPANY'S EXPECTATIONS WITH REGARD THERETO OR ANY CHANGE IN EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH ANY SUCH STATEMENTS ARE BASED

ISIN:	JE00B6T5S470
Category Code:	PGR
TIDM:	POLY
Sequence No.:	10107
EQS News ID:	824449

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