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Polymetal International PLC on Thursday said it is offering to exchange a portion of its shares, namely those affected by the EU asset freeze on National Settlement Depository following Russia's invasion of Ukraine.
Meanwhile, the firm permanently cancelled dividends for 2021.
Shares in the St Petersburg, Russia-based miner were 11% lower at 200.85 pence each in London on Thursday afternoon.
In the half-year ended June 30, Polymetal reported a pretax loss of $348 million, swinging from a profit of $521 million.
Revenue dropped 18% to $1.05 billion from $1.27 billion. The average realised gold price rose 4% to $1,864 per ounce from $1,793. However, the average realised silver price dropped 14% to $22.9 per ounce from $26.5 per ounce.
The company decided to cancel full-year 2021 dividends and does not propose any interim 2022 dividend.
‘Payment of dividends in the future will also depend on the ability to unblock shares which are currently held through the National Settlement Depositary, NSD, which the company estimates to be, in aggregate, approximately 22% of the company's issued share capital,’ it said.
National Settlement Depository is a Moscow-based non-bank financial institution and central securities depository, which provides settlement and related services to financial market entities.
Following Russia's invasion of Ukraine in February, the EU in June sanctioned NSD, blocking Polymetal's operations between Euroclear and NSD. Euroclear is the paperless system for settlement of share transfers and holding of shares in uncertificated form, Polymetal explained.
On Thursday, Polymetal said it is offering to exchange some shares affected by the EU asset freeze.
Due to sanctions, ‘shareholders who are resident in, incorporated in, established in, or citizens of, Russia, including those with a second citizenship outside Russia,’ are not eligible to participate in the exchange offer, the company added. It noted about 11% of its shareholders will not be eligible for an exchange.
‘The exchange offer invites shareholders whose rights have been affected by the sanctions imposed on NSD, subject to fulfilling eligibility criteria, to tender such shares for exchange in consideration for the issuance of a certificated share, on a one-for-one basis,’ Polymetal said.
The exchange offer requires shareholder approval at a general meeting under Jersey laws, where the company is registered. The general meeting will be held on October 12.
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