Newmont tops profit estimates on gold surge
The world’s biggest gold miner’s adjusted net income for the June quarter was $261-million, or $0.32 a diluted share, compared with $92-million, or $0.12 a diluted share, in the prior-year quarter. The result topped analysts’ estimates of $0.31 per share.
Newmont reported $984 million in adjusted EBITDA and $388 million in free cash flow.
Revenue rose 5% from the prior-year quarter to $2.37-billion, helped by record-high gold prices.
Newmont’s averaged realized gold price jumped about 31% to $1,724 per ounce in the second quarter ended June 30.
Its attributable gold production, however, fell 21% to 1.26 million ounces as coronavirus lockdowns led to the temporary closure of some of its mine sites.
“We safely and efficiently executed restart plans at our mines previously in care and maintenance and Newmont’s world-class portfolio is well positioned to deliver an even stronger second half of 2020.” said Tom Palmer, President and CEO.
“The ongoing favorable gold price environment amplifies our free cash flow generation yet our discipline around capital allocation will not change as we continue to invest in profitable projects”.
On Wednesday, Agnico Eagle, also reported a near four-fold increase in quarterly profit, owing to the surge in gold prices.
Newmont will spend $45 million per month to maintain safety protocols at its mines and is particularly worried about community spread of the virus in Mexico, Peru and Argentina, CEO Tom Palmer said on a call.
The company reaffirmed its revised guidance issued on May 19. The miner’s 2020 attributable gold production remains at about six-million ounces.
Midday Thursday, Newmont’s stock was down nearly 3% on the NYSE. The company has a $52 billion market capitalization.