Russia’s listed mining and metals companies are increasingly being evaluated on capital allocation, liquidity management and project execution rather than dividend distributions. Recent reporting from major Moscow Exchange (MOEX) mining and metals producers highlights widening differences between companies able to finance expansion projects and those focused on preserving cash amid sanctions, weaker domestic demand, higher interest rates and changing commodity markets.
The latest reporting cycle shows contrasting outlooks across gold, nickel, copper, palladium, platinum, diamonds, aluminium, steel and coal, with companies adjusting investment priorities as export logistics, financing conditions and industrial demand continue to evolve.
Polyus expands investment programme alongside strong gold prices
Polyus remains the strongest capital investment story among Russia’s listed miners, supported by elevated gold prices and a significant development pipeline. The company produced 2.529 million ounces of gold in 2025, within its guidance range of 2.5-2.6 million ounces, although output declined 16% year-on-year due to planned mining-stage transitions at the Olimpiada and Blagodatnoye operations.
While production declined, investment accelerated substantially. Capital expenditure increased 73% to a record US$2.18 billion, supporting development at the Sukhoi Log, Chulbatkan, Chertovo Koryto, Blagodatnoye Mill-5 projects, stripping activities at Olimpiada and processing technology upgrades.
Revenue rose 19% to US$8.723 billion, while adjusted EBITDA increased 12% to US$6.347 billion. The board recommended a Q4 2025 dividend of RUB56.8 per ordinary share, based on 30% of fourth-quarter EBITDA under the company’s dividend policy.
Sukhoi Log anchors long-term growth strategy
The development of the Sukhoi Log deposit remains central to Polyus’ long-term expansion programme. As one of the world’s largest undeveloped gold deposits, Sukhoi Log provides the company with a significant future growth project while increasing investor attention on project execution, capital allocation and cost management.
Market attention is increasingly focused on maintaining development schedules for Blagodatnoye Mill-5, Sukhoi Log preparation works and processing upgrades while controlling cost inflation and managing project complexity within a sanctions-affected operating environment.
Nornickel balances production targets with market challenges
Nornickel continues to occupy a strategic position in global nickel, copper, palladium and platinum supply. During the first quarter of 2026, nickel production remained broadly stable at approximately 42,000 tonnes, while copper output declined 10% to about 99,000 tonnes. Palladium production fell 18% to 608,000 ounces, and platinum production decreased 24% to 136,000 ounces.
The company maintained its 2026 production guidance of 193,000-203,000 tonnes of nickel, 336,000-356,000 tonnes of copper, 2.415-2.465 million ounces of palladium and 616,000-636,000 ounces of platinum from Russian feed.
For 2025, Nornickel reported US$13.76 billion in revenue, US$5.67 billion in EBITDA and US$2.47 billion in net profit. Despite remaining strongly cash-generative, the board recommended no dividend for FY2025, reflecting a strategy focused on capital preservation, investment expenditure, logistics flexibility and balance-sheet resilience.
Palladium demand initiatives target industrial markets
Nornickel is also seeking to expand industrial demand for palladium. The company is promoting palladium use within China’s fibreglass industry and the wider glass manufacturing sector, identifying potential medium-term demand of up to 800,000 ounces annually in Chinese fibreglass production and up to 2 million ounces across the broader global glass industry.
In addition, Nornickel has established a US$100 million programme targeting the creation of 1.7 million ounces of new annual palladium demand by 2030. The initiative responds to changing automotive demand as internal combustion engine production gradually declines and seeks to broaden industrial applications for palladium.
ALROSA adjusts to structural diamond market pressures
ALROSA continues to face weaker jewellery demand, sanctions affecting Russian diamonds, elevated inventories and increasing competition from laboratory-grown stones. The company has introduced a Natural Diamond Promotion Program through 2030 aimed at strengthening consumer demand and reinforcing the distinction between natural and synthetic diamonds within major jewellery markets.
ALROSA has also highlighted Russian jewellery guidelines specifying that only natural gemstones may be marketed as diamonds.
Operationally, diamond production declined approximately 10% to 29.8 million carats in 2025, while the company expects output to decrease further to 25-26 million carats during 2026. Russia is also considering export duties on selected diamonds to support domestic cutting and polishing activities.
RUSAL focuses on operational efficiency amid margin pressure
RUSAL continues to play a major role across the aluminium, alumina and bauxite value chain despite deteriorating financial performance. The company reported a US$455 million net loss for 2025, compared with an US$803 million profit in 2024, although revenue increased 22.6% to US$14.81 billion.
Aluminium sales rose 16.4% to 4.49 million tonnes, but higher operating costs, lower production and compressed margins offset revenue growth. Operational improvements included deployment of software for automated anode production at Sayanogorsk, implementation of neural-network technology to improve alumina quality and process enhancements related to electrolyser installation. The company continues to manage challenges associated with alumina supply, energy costs, sanctions and export restrictions, while the Aughinish Alumina supply chain in Ireland remains subject to political attention.
Russian steel producers face weakening domestic demand
Steel producers are reporting weaker financial performance as domestic demand softens. MMK reported first-quarter 2026 pig iron production of 2.382 million tonnes, down 5.5% quarter-on-quarter, while steel production declined 3.8% to 2.448 million tonnes. Metal product sales fell 8.5% to 2.247 million tonnes, while premium product sales decreased 10.9%, reducing premium products to 40.4% of total sales.
Revenue declined to RUB129.0 billion, down 11.5% quarter-on-quarter and 18.6% year-on-year. EBITDA fell 55.9% quarter-on-quarter to RUB8.624 billion, producing an EBITDA margin of 6.7%. The company reported a net loss of RUB1.37 billion and negative free cash flow of RUB14.14 billion, reflecting pressure from weaker domestic steel markets despite integrated raw-material assets.
Severstal and NLMK preserve liquidity
Severstal also reported weaker financial performance. The company recorded 2025 net profit of RUB31.99 billion, down 79%, while revenue declined 14% to RUB712.9 billion. Free cash flow turned negative, and the company did not recommend a Q4 2025 dividend.
Management indicated that Russian steel demand could weaken further during 2026, although Severstal plans to increase steel production from 10.8 million tonnes in 2025 to 11.3 million tonnes. Investor attention has increasingly shifted toward working-capital management, capital expenditure and domestic pricing conditions rather than production volumes alone.
NLMK also suspended dividend payments for 2025. Its Q1 2026 Russian accounting results reported a net loss of RUB5.94 billion, compared with RUB1.23 billion a year earlier, while revenue declined to RUB145.57 billion from RUB163.3 billion. The results reflect continued pressure from weaker domestic demand, elevated borrowing costs and constrained export markets.
Mechel targets coal production recovery
Mechel remains one of the highest-risk companies within Russia’s listed mining sector. The company reported a 2025 RAS loss of approximately RUB10.4 billion, while revenue declined 47.7% to RUB18.2 billion.
Coal production for 2025 was expected to total 7.3-7.6 million tonnes, with management targeting an increase to 11-12 million tonnes during 2026. Part of the strategy involves replacing purchased raw materials with concentrate supplied by Korshunovsky GOK, a move intended to improve operating costs. The company’s recovery outlook remains closely linked to coal prices, transport logistics, debt management and operational execution.
Mining investment themes diverge across MOEX
Recent reporting illustrates a more differentiated investment landscape across the Moscow Exchange mining and metals sector. Polyus continues to advance a long-term gold growth strategy supported by major capital investment and the development of Sukhoi Log. Nornickel remains Russia’s principal producer of strategic critical metals while emphasizing capital preservation and initiatives to expand industrial palladium demand.
ALROSA is restructuring its market strategy around natural diamond demand, while RUSAL is concentrating on operational efficiencies amid pressure across aluminium supply chains. Steel producers MMK, Severstal and NLMK are increasingly influenced by domestic market conditions and liquidity preservation, while Mechel remains focused on restoring coal production within a challenging financial environment.
Across the sector, investor attention has shifted from traditional dividend expectations toward project execution, cash-flow resilience, capital discipline and the ability to sustain investment under sanctions, higher financing costs and evolving commodity markets.
