Updated Version 2 - Boosted by rising gold prices and the restart of the Cadia mine, Newmont's quarterly profit exceeded expectations

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Varun Sahay/Divya Rajagopal

Reuters, October 22 - Newmont Corporation (NEM.N) reported third-quarter profits on Thursday that beat analyst expectations, mainly thanks to higher gold prices and a recovery in copper output at its Australia-based Cadia mine, which boosted earnings growth.

Despite a stronger dollar and inflation worries as the US enters into conflict with Iran pushing up oil prices, investors have still sought safe-haven assets. This quarter’s average gold price was $4,204.59 per ounce, up about 17.6% from the same period last year.

Quarterly revenue rose 15% to $6.36 billion, while Cadia mine’s copper output jumped 35% to 23,000 tons from the previous quarter as it recovered from shutdown disruptions.

The company’s stock price rose 1.5% in after-hours trading.

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Newmont said it is advancing its Red Chris Block Cave joint venture project in British Columbia, Canada, aiming to make a final investment decision by early 2027.

The project is expected to produce about 3 million ounces of gold and over 85,000 tons of copper during the initial 13 years of cave mining. Commercial production is planned for 2033.

The mining company, who holds a 70% stake in the ‘Red Chris’ project, estimates that, excluding the expected C$500 million ($356.99 million) grant from the Canadian government, development capital will range between $4.2 billion and $4.8 billion.

The company also revised its joint venture agreement with Canada’s Barrick Mining ABX.TO for Nevada gold mines, adding Barrick’s Fourmile mine and Newmont’s Fiberline and Mike mines to the agreement, and plans to pay $1.95 billion to Barrick in the fourth quarter.

Chief Executive Officer Natascha Viljoen stated that Newmont does not intend to acquire Australian gold miner Northern Star Resources NST.AX, saying the company’s assets do not fit its strategy.

“It’s really hard to find better assets than the ones we own and operate ourselves,” Viljoen said.

According to data compiled by London Stock Exchange Group (LSEG), the company posted adjusted earnings per share of $2.20 for the quarter ending September 30, above the average analyst expectation of $2.05 per share.

(US$1 = C$1.4006)

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