With Newcrest tucked away, Newmont
(ASX:NEM) was always going to do better in the March quarter than investors and analysts suspected, and so the news of a substantial beat on gold production for the March quarter shouldn’t have been such a surprise.
And yet it was, with the share price jumping more than 12% in the wake of the release of the quarterly showing a record 2.2 million equivalent ounces of gold (that measure includes copper, lead, zinc and silver) were produced in the three months.
Attributable gold production totalled 1.7 million ounces in the quarter, up from 1.3 million ounces in the March 2023 quarter, thanks to the contribution from Newcrest.
Analysts had estimated a production of 1.61 million ounces, and the size of the beat added to the surge in the share price.
Sales in the quarter were $US4.02 billion, compared with $US2.68 billion a year earlier -- the big rise flowing from the higher gold and copper production contributed by Newcrest.
The company reported adjusted EBITDA of $US1.7 billion for the quarter, up from $US994 a year ago.
Newmont reported higher average gold price at $US2,090 per ounce for the quarter from $US1,906 a year earlier, as spot prices rose about 8%.
All-in-sustaining cost for gold, rose to $US1,439 per ounce of gold from $US1,376 a year earlier. That increase didn’t concern investors.
Newmont maintained its 2024 forecasts, with production of 6.9 million ounces of gold at an AISC of $US1,400 an ounce.
Newmont says it is getting strong interest on the six non-core assets it wants to sell (most are from Newcrest and include the Telfer/Havieron mine and prospect in WA).
The company took a $US485 million write down in the value of those assets and one project (Havieron in WA).
It sold Newcrest’s Lundin Gold stream credit facility and offtake agreement for $US330 million, while maintaining its equity interest in Lundin Gold of Canada.
Separately, the company said operations at its Cerro Negro mine in Argentina have been suspended as a full investigation is being conducted after the death of two members of the workforce on April 9.
