Newmont’s produces 17% less gold y-o-y
Newmont, the world’s largest gold producer, announced today that its Q2 2023 attributable gold production decreased 17% y-o-y to 1.24 million ounces primarily due to lower production at Peñasquito, Akyem, Merian, Cerro Negro and Boddington.
The company said that in addition, lower than planned production was delivered from the non-managed joint venture at Pueblo Viejo. Attributable gold sales were largely in line with gold production for the quarter.
According to a press release, the company’s gold costs applicable to sales (CAS) increased 13% to $1,054 per ounce from the prior year quarter primarily due to lower gold sales volumes.
Moreover, gold all-in sustaining costs (AISC) increased 23% to $1,472 per ounce from the prior year quarter primarily due to higher CAS per gold ounce and higher sustaining capital spend.
Newmont’s attributable gold equivalent ounce (GEO) production from other metals decreased 22% to 256 thousand ounces primarily due to the suspension of operations at Peñasquito.
Newmont noted that its Q2 2023 revenue decreased 12% from the prior year quarter to $2.7 billion primarily due to lower gold and silver sales volumes, partially offset by higher average realized prices for all metals except zinc.
Importantly, the company said that net income from continuing operations attributable to Newmont stockholders was $153 million or $0.19 per diluted share, a decrease of $226 million from the prior year quarter primarily due to lower sales volumes and higher income tax expense.
Adjusted net income was $266 million or $0.33 per diluted share, compared to $362 million or $0.46 per diluted share in the prior year quarter. Primary adjustments include changes in the fair value of investments, Newcrest transaction costs, restructuring and severance costs, as well as valuation allowance and other tax adjustments.
The company’s adjusted EBITDA decreased 21% to $0.9 billion for the quarter, compared to $1.1 billion for the prior year quarter.
“Balance sheet and liquidity remained strong in the second quarter, ending the quarter with $2.8 billion of consolidated cash and $374 million of time deposits with a maturity of more than three months but less than one year, with approximately $6.2 billion of total liquidity; reported net debt to adjusted EBITDA of 0.7x,” the company said in a statement.
The company also announced that its Board of Directors declared a dividend of $0.40 per share of common stock for the second quarter of 2023; payable on September 21, 2023 to holders of record at the close of business on September 7, 2023.
More importantly, Newmont noted that the company is on track to achieve full-year guidance of between 5.7 and 6.3 million ounces of attributable gold production with gold AISC between $1,150 and $1,250 per ounce; primarily driven by increased production at Ahafo, Tanami, Cerro Negro, Akyem and the two non-managed joint ventures at Nevada Gold Mines and Pueblo Viejo.
President and CEO Tom Palmer commented on the results, “In the second quarter, Newmont delivered $910 million in adjusted EBITDA with a disciplined approach to running a safe and sustainable mining business to generate long-term value. Our business is underpinned by the industry’s strongest balance sheet and a global portfolio with the size and scale to make decisions that deliver on our strategy.
“We remain on track to achieve our full-year guidance, and I am proud of the prudent decisions made during the second quarter to safeguard our workforce, protect long-term value and position Newmont to deliver a strong performance in the second half of the year.”
Newmont is the world’s leading gold company and a producer of copper, silver, lead and zinc. The company’s assets located in favorable mining jurisdictions in North America, South America, Australia and Africa. Newmont is the only gold producer listed in the S&P 500 Index. The company was founded in 1921 and has been publicly traded since 1925.
