Newmont Announces Second Quarter Net Income From Continuing Operations of $1.06 per Share; Quarterly Dividend Increased 50% to $0.30 per Share
DENVER, July 29, 2011 /CNW/ --
<<
This release should be read in conjunction with Newmont's Second Quarter
2011 Form 10-Q filed with the Securities and Exchange Commission on July
29, 2011 (available at www.newmont.com).
>>
Newmont Mining Corporation (NYSE: NEM) ('Newmont' or the 'Company') today announced that its second quarter 2011 attributable net income from continuing operations increased 37% to $523 million ($1.06 per share)(1) compared to $382 million ($0.78 per share) in the second quarter of 2010. Adjusted net income(2) increased 18% to $445 million ($0.90 per share) in the second quarter of 2011, from $377 million ($0.77 per share) in the second quarter of 2010.
As previously announced, based on the Company's average realized gold price of $1,501 per ounce for the second quarter of 2011, Newmont's Board of Directors approved a third quarter 2011 gold price-linked dividend of $0.30 per share(3), an increase of 50% over the $0.20 dividend paid in the second quarter of 2011, and an increase of 100% over the $0.15 dividend paid in the third quarter of 2010.
<<
Second Quarter Highlights:
-- Consolidated revenue of $2.4 billion, an increase of 11% from the
prior
year quarter;
-- Average realized gold and copper price of $1,501 per ounce and $3.78
per pound, up 25% and 62%, respectively, from the prior year quarter;
-- Attributable gold and copper production of 1.2 million ounces and 44
million pounds, down 5% and 45%, respectively, from the prior year
quarter, impacted by processing lower grade stockpiles at Batu Hijau
and lower grade ore at Nevada;
-- Operating cash flow from continuing operations of $414 million, 45%
lower than the prior year quarter due primarily to approximately $300
million in tax payments in Indonesia related to 2010 earnings;
-- Gold and copper costs applicable to sales ('CAS')of $583 per ounce and
$1.34 per pound, respectively ($588 per ounce and $1.41 per pound,
respectively, on an attributable basis(4));
-- Net attributable CAS(4) for gold of $499 per ounce; and
-- Maintaining 2011 outlook for production, CAS, and capital
expenditures.
>>
'We were pleased to announce our third dividend increase in the past twelve months. With our average realized gold price increasing by 25% since the second quarter of last year, our dividend has doubled, highlighting our commitment to delivering value to our shareholders,' said Richard O'Brien, President and Chief Executive Officer. 'We were also pleased with our operating performance for the quarter, with gold production consistent with our plans and operating costs trending below expectations. Coupled with the rising gold price, our strong operating performance helped generate a 37% increase in net income from continuing operations for our shareholders.'
<<
>>
The Company is maintaining its previously announced 2011 outlook for attributable gold production of 5.1 to 5.3 million ounces at CAS of between $560 and $590 per ounce (on a co-product basis) and 2011 attributable copper production of 190 to 220 million pounds at CAS of between $1.25 and $1.50 per pound. Newmont is maintaining its 2011 attributable capital expenditure outlook of $2.1 to $2.5 billion, or $2.7 to $3.0 billion on a consolidated basis. Capital spending through the first half of 2011 has been lower than expected across the portfolio, but expected to accelerate in the second half of the year.
<<
Operations
North America
>>
Nevada -Attributable gold production at Nevada was 357,000 ounces at CAS of $636 per ounce during the second quarter. Gold production decreased 15% from the prior year quarter due to mining and processing lower grade ore, partially offset by higher mill throughput and leach placement and the commencement of underground mining at Exodus. In addition, open pit ore tons mined increased 47% as the remediation of the Gold Quarry pit slope failure was completed. CAS increased 9% in the second quarter of 2011 from the prior year quarter due to lower production and higher diesel prices, partially offset by higher by-product credits.
The Company continues to expect 2011 attributable gold production from Nevada of approximately 1.8 to 1.9 million ounces at CAS of between $565 and $615 per ounce.
La Herradura - Attributable gold production at La Herradura in Mexico was 53,000 ounces at CAS of $514 per ounce during the second quarter. Gold production increased 23% in the second quarter of 2011 from the prior year quarter due to higher leach placement at Soledad and Dipolos. CAS increased 19% due to higher mining, leaching and employee profit sharing costs, partially offset by higher production and by-product credits.
The Company continues to expect 2011 attributable gold production from La Herradura of approximately 180,000 to 200,000 ounces at CAS of between $480 and $510 per ounce.
<<
South America
>>
Yanacocha - Attributable gold production at Yanacocha in Peru was 175,000 ounces at CAS of $545 per ounce during the second quarter. Gold production decreased 3% in the second quarter of 2011 from the prior year quarter due to lower leach placement at Yanacocha and La Quinua as a result of mine sequencing and lower equipment availability, partially offset by higher mill grade, throughput and recovery. Ore tons mined decreased 39% due to mine sequencing at El Tapado. CAS increased 40% in the second quarter of 2011 from 2010 due to lower production combined with higher waste mining, higher diesel prices and labor and royalty costs, partially offset by higher by-product credits and lower workers' participation costs.
The Company continues to expect 2011 attributable gold production at Yanacocha of approximately 675,000 to 725,000 ounces at CAS of between $500 and $550 per ounce.
La Zanja - Attributable gold production during the second quarter at La Zanja in Peru was 18,000 ounces.
The Company continues to expect 2011 attributable gold production at La Zanja of between 40,000 and 50,000 ounces.
<<
Asia Pacific
>>
Boddington - Attributable gold and copper production during the second quarter at Boddington in Australia were 205,000 ounces and 16 million pounds, respectively, at CAS of $641 per ounce and $1.94 per pound, respectively. Gold production increased 11% over the prior year quarter due to higher throughput. Copper production increased 7% over the prior year quarter due to higher throughput, partially offset by lower recovery. CAS per ounce of gold and per pound of copper increased 10% and 25%, respectively, over the prior year quarter due to higher conveyor maintenance costs, royalty and power costs, higher diesel prices and a stronger Australian dollar, (net of hedging gains), partially offset by higher production and by-product credits.
The Company continues to expect 2011 attributable gold production at Boddington of approximately 750,000 to 800,000 ounces at CAS of between $580 and $620 per ounce, and 2011 attributable copper production of 70 to 80 million pounds at CAS of between $1.80 and $2.20 per pound.
Batu Hijau - Attributable gold and copper production during the second quarter at Batu Hijau in Indonesia were 26,000 ounces and 28 million pounds, respectively, at CAS of $490 per ounce and $1.23 per pound, respectively. Gold and copper production decreased 70% and 56% in the second quarter of 2011 from the prior year quarter, respectively, due to lower grade, throughput and recovery as a result of processing stockpiled material as expected, compared to mining high grade Phase 5 ore in the second quarter of 2010. Waste tons mined doubled as Phase 6 waste removal continues as planned. The Company expects Phase 6 ore to become the primary ore feed commencing in late 2013. CAS increased 67% per ounce and 86% per pound, respectively, over the prior year quarter due to lower production and higher waste mining costs, partially offset by higher by-product credits.
The Company continues to expect 2011 attributable gold production for Batu Hijau of approximately 110,000 to 140,000 ounces at CAS of between $400 and $440 per ounce, while attributable copper production is expected to be approximately 120 to 140 million pounds, at CAS of between $1.10 and $1.30 per pound.
Other Australia/New Zealand - Attributable gold production during the second quarter in other Australia/New Zealand was 244,000 ounces at CAS of $638 per ounce. Attributable gold production was 5% lower than the prior year quarter due to lower throughput at Tanami and Jundee and a build-up of in-process inventory at Jundee, partially offset by higher throughput at Kalgoorlie and Waihi. CAS were 20% higher than the prior year quarter due to lower production and higher operating costs which were driven by power and diesel prices and a stronger Australian dollar, net of hedging gains.
The Company continues to expect 2011 attributable gold production at the Other Australia/New Zealand operations of approximately 1.0 to 1.05 million ounces at CAS of between $700 and $770 per ounce.
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Africa
>>
Ahafo - Attributable gold production during the second quarter at Ahafo in Ghana was 146,000 ounces at CAS of $446 per ounce. Gold production increased 11% in the second quarter of 2011 from the prior year quarter due to higher mill ore grade and recovery as a result of mine sequencing. CAS per ounce increased 7% due to higher diesel prices and higher power, labor and royalty costs, partially offset by higher production.
The Company continues to expect 2011 attributable gold production at Ahafo of approximately 550,000 to 590,000 ounces at CAS of between $485 and $535 per ounce.
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Capital Update
>>
Consolidated capital expenditures were $618 million during the second quarter. Newmont is maintaining its 2011 attributable capital expenditure outlook of $2.1 to $2.5 billion, or $2.7 to $3.0 billion on a consolidated basis. Capital spending through the first half of 2011 has been lower than expected across the portfolio, but is expected to accelerate in the second half of the year. For the remainder of the year, 40% of 2011 consolidated capital expenditures are expected to be associated with major project initiatives, including further development of the Akyem project in Ghana, the Conga project in Peru, Hope Bay in Canada, and the Nevada project portfolio, while the remaining 60% is expected to correspond with growth and sustaining capital.
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2011 Outlook (5,6)
------------------
>>
<<
2011 Outlook 2011 Outlook
Attributable
Region Production Consolidated CAS
(Kozs, Mlbs) ($/oz, $/lb)
Nevada 1,800 - 1,900 $565 - $615
La Herradura 180 - 200 $480 - $510
Hope Bay - -
North America 1,980 - 2,100 $560 - $600
------------- ------------- -----------
Yanacocha 675 - 725 $500 - $550
La Zanja 40 - 50 n/a
Conga - -
South America 715 - 775 $500 - $550
------------- --------- -----------
Boddington - Gold 750 - 800 $580 - $620
Other Australia/NZ 1,000 - 1,050 $700 - $770
Batu Hijau - Gold a 110 - 140 $400 - $440
Asia Pacific 1,860 - 1,990 $600 - $675
------------ ------------- -----------
Ahafo 550 - 590 $485 - $535
Akyem - -
Africa 550 - 590 $485 - $535
------ --------- -----------
Corporate/Other
---------------
Total Gold 5,100 - 5,300 $560 - $590 (b,c)
---------- ------------- -----------------
Boddington - Copper 70 - 80 $1.80 - $2.20
Batu Hijau - Copper (a) 120 - 140 $1.10 - $1.30
Total Copper 190 - 220 $1.25 - $1.50
------------ --------- -------------
>>
<<
2011 Outlook 2011 Outlook
Consolidated Attributable
Region Capital Capital
Expenditures Expenditures
Nevada $460 - $520 $460 - $520
La Herradura $70 - $80 $70 - $80
Hope Bay $70 - $100 $70 - $100
North America $600 - $700 $600 - $700
------------- ----------- -----------
Yanacocha $310 - $400 $160 - $200
La Zanja - -
Conga $550 - $700 $300 - $360
South America $900 - $1,100 $460 - $560
------------- ------------- -----------
Boddington - Gold $210 - $255 $210 - $255
Other Australia/NZ $230 - $265 $230 - $265
Batu Hijau - Gold a $210 - $230 $95 - $110
Asia Pacific $650 - $750 $535 - $595
------------ ----------- -----------
Ahafo $175 - $200 $175 - $200
Akyem $300 - $375 $300 - $375
Africa $450 - $545 $475 - $575
------ ----------- -----------
Corporate/Other $30 - $40 $30 - $40
---------------
Total Gold $2,700 - $3,000 $2,100 - $2,500
---------- --------------- ---------------
Boddington - Copper - -
Batu Hijau - Copper (a) - -
Total Copper
------------
>>
<<
(a) Assumes Batu Hijau economic interest of 48.5% for 2011
(b) 2011 Outlook Attributable CAS is $570 -$600 per ounce
(c) 2011 Outlook Net Attributable CAS (by-product basis) is $485 -
$515 per ounce
>>
<<
2011 Outlook
Consolidated
Description Expenses
----------- ------------
($M)
General & Administrative $190 - $200
Interest Expense $235 - $245
DD&A $1,025 - $1,035
Exploration Expense $335 - $345
Advanced Projects & R&D $400 - $450
Tax Rate 26% - 30%
-------- ---------
Assumptions
-----------
Gold Price ($/ounce) $1,450
Copper Price ($/pound) $4.00
Oil Price ($/barrel) $110
Australian Dollar
Exchange Rate 1.05
----------------- ----
>>
<<
(1) Newmont recorded a $136 million ($0.28 per share) accrual on an
after-tax basis related to the St. Andrews Goldfields Ltd.
litigation in 'discontinued operations,' as further described in the
Company's 8-K filed on July 15, 2011.
(2) Non-GAAP measure; see page 11 for reconciliation.
(3) Payable on September 29, 2011 to shareholders of record on
September 8, 2011.
(4) See page 12 for reconciliation between consolidated,
attributable, and net attributable CAS.
(5) Outlook referenced in the table above and elsewhere in this
release is based upon management's good faith estimates as of July
29, 2011 and are considered 'forward-looking statements.'
References to outlook guidance are based on current mine plans,
assumptions noted above and current geotechnical, metallurgical,
hydrological and other physical conditions, which are subject to
risk and uncertainty as discussed in the 'Cautionary Statement' on
page 13.
>>
<<
(6) The underlying oil price and Australian dollar exchange rate
assumptions associated with the Company's Outlook have been updated
to assume an average oil price of $110 per barrel and an average
Australian dollar exchange rate of $1.05. CAS in 2011, inclusive of
hedge gains and losses, are expected to change by approximately $5
per ounce for every $10 change in the oil price and by approximately
$2 per ounce for every $0.10 change in the Australian dollar
exchange rate.
>>
NEWMONT MINING CORPORATION
<<
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in millions except per share)
>>
<<
Three Months
Ended
June 30,
--------
2011 2010
---- ----
>>
Sales $2,384 $2,153
<<
Costs and expenses
Costs applicable to sales
(1) 917 848
Amortization 250 231
Reclamation and
remediation 43 13
Exploration 89 53
Advanced projects,
research and development 86 57
>>
<<
General and administrative 50 43
Other expense, net 87 61
--- ---
1,522 1,306
----- -----
Other income (expense)
Other income, net 48 44
Interest expense, net (63) (69)
--- ---
(15) (25)
--- ---
Income before income and
mining tax and other items 847 822
Income and mining tax
expense (187) (283)
Equity income (loss) of
affiliates - (2)
--- ---
Income from continuing
operations 660 537
Loss from discontinued
operations (136) -
---- ---
Net income 524 537
Net income attributable to
noncontrolling interests (137) (155)
---- ----
Net income attributable to
Newmont stockholders $387 $382
==== ====
>>
<<
Net income attributable to
Newmont stockholders:
Continuing operations $523 $382
Discontinued operations (136) -
---- ---
$387 $382
==== ====
Net Income attributable to
Newmont stockholders per
common share
Basic:
Continuing operations $1.06 $0.78
Discontinued operations (0.28) -
----- ---
$0.78 $0.78
===== =====
Diluted:
Continuing operations $1.04 $0.77
Discontinued operations (0.27) -
----- ---
$0.77 $0.77
===== =====
>>
<<
Cash dividends declared
per common share $0.20 $0.10
>>
<<
Six Months
Ended
June 30,
--------
2011 2010
---- ----
>>
Sales $4,849 $4,395
<<
Costs and expenses
Costs applicable to sales
(1) 1,857 1,717
Amortization 506 455
Reclamation and
remediation 57 26
Exploration 151 96
Advanced projects,
research and development 154 103
>>
<<
General and administrative 95 88
Other expense, net 160 150
--- ---
2,980 2,635
----- -----
Other income (expense)
Other income, net 79 92
Interest expense, net (128) (144)
---- ----
(49) (52)
--- ---
Income before income and
mining tax and other items 1,820 1,708
Income and mining tax
expense (492) (424)
Equity income (loss) of
affiliates 2 (4)
--- ---
Income from continuing
operations 1,330 1,280
Loss from discontinued
operations (136) -
---- ---
Net income 1,194 1,280
Net income attributable to
noncontrolling interests (293) (352)
---- ----
Net income attributable to
Newmont stockholders $901 $928
==== ====
>>
<<
Net income attributable to
Newmont stockholders:
Continuing operations $1,037 $928
Discontinued operations (136) -
---- ---
$901 $928
==== ====
Net Income attributable to
Newmont stockholders per
common share
Basic:
Continuing operations $2.10 $1.89
Discontinued operations (0.28) -
----- ---
$1.82 $1.89
===== =====
Diluted:
Continuing operations $2.07 $1.87
Discontinued operations (0.27) -
----- ---
$1.80 $1.87
===== =====
>>
<<
Cash dividends declared
per common share $0.35 $0.20
>>
<<
(1) Excludes Amortization and Reclamation and remediation.
>>
NEWMONT MINING CORPORATION
<<
STATEMENTS OF CONSOLIDATED CASH FLOW
(unaudited, in millions)
>>
<<
Three Months Ended June
30,
------------------------
2011 2010
---- ----
>>
<<
Operating activities:
Net income $524 $537
Adjustments:
Amortization 250 231
Loss from discontinued operations 136 -
Reclamation and remediation 43 13
Deferred income taxes (5) 16
Stock based compensation and other non-
cash benefits 25 21
Gain on asset sales, net (50) (14)
Other operating adjustments and write-
downs 52 27
Net change in operating assets and
liabilities (561) (78)
---- ---
Net cash provided from continuing
operations 414 753
Net cash used in discontinued
operations (2) -
--- ---
Net cash provided from operations 412 753
--- ---
Investing activities:
Additions to property, plant and mine
development (618) (319)
Proceeds from sale of marketable
securities 55 1
Purchases of marketable securities (3) (4)
Acquisitions, net (2,284) -
Proceeds from sale of other assets - 14
Other (12) (12)
--- ---
Net cash used in investing activities (2,862) (320)
------ ----
Financing activities:
Proceeds from debt, net 775 -
Repayment of debt (942) (13)
Sale of noncontrolling interests - -
Acquisition of noncontrolling interests - (70)
Dividends paid to common stockholders (99) (49)
Dividends paid to noncontrolling
interests (2) (87)
Proceeds from stock issuance, net 5 27
Change in restricted cash and other - 2
--- ---
Net cash used in financing activities (263) (190)
---- ----
>>
<<
Effect of exchange rate changes on cash 35 (5)
--- ---
>>
<<
Net change in cash and cash equivalents (2,678) 238
Cash and cash equivalents at beginning
of period 4,533 3,364
----- -----
Cash and cash equivalents at end of
period $1,855 $3,602
------ ------
>>
<<
Six Months Ended June
30,
----------------------
2011 2010
---- ----
>>
<<
Operating activities:
Net income $1,194 $1,280
Adjustments:
Amortization 506 455
Loss from discontinued operations 136 -
Reclamation and remediation 57 26
Deferred income taxes (38) (86)
Stock based compensation and other non-
cash benefits 44 39
Gain on asset sales, net (53) (49)
Other operating adjustments and write-
downs 97 67
Net change in operating assets and
liabilities (540) (251)
---- ----
Net cash provided from continuing
operations 1,403 1,481
Net cash used in discontinued
operations (2) (13)
--- ---
Net cash provided from operations 1,401 1,468
----- -----
Investing activities:
Additions to property, plant and mine
development (1,020) (628)
Proceeds from sale of marketable
securities 55 1
Purchases of marketable securities (15) (7)
Acquisitions, net (2,291) -
Proceeds from sale of other assets 6 52
Other (15) (23)
--- ---
Net cash used in investing activities (3,280) (605)
------ ----
Financing activities:
Proceeds from debt, net 775 -
Repayment of debt (973) (263)
Sale of noncontrolling interests - 229
Acquisition of noncontrolling interests - (109)
Dividends paid to common stockholders (173) (98)
Dividends paid to noncontrolling
interests (17) (307)
Proceeds from stock issuance, net 8 30
Change in restricted cash and other - 48
--- ---
Net cash used in financing activities (380) (470)
---- ----
>>
<<
Effect of exchange rate changes on cash 58 (6)
--- ---
>>
<<
Net change in cash and cash equivalents (2,201) 387
Cash and cash equivalents at beginning
of period 4,056 3,215
----- -----
Cash and cash equivalents at end of
period $1,855 $3,602
------ ------
>>
NEWMONT MINING CORPORATION
<<
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in millions)
>>
<<
At
At June December
30, 31,
2011 2010
---- ----
ASSETS
Cash and cash
equivalents $1,855 $4,056
Trade receivables 418 582
Accounts receivable 135 88
Investments 203 113
Inventories 671 658
Stockpiles and ore on
leach pads 696 617
Deferred income tax
assets 308 177
Other current assets 1,613 962
----- ---
Current assets 5,899 7,253
>>
<<
Property, plant and
mine development, net 16,663 12,907
Investments 1,675 1,568
Stockpiles and ore on
leach pads 1,950 1,757
Deferred income tax
assets 1,505 1,437
Other long-term assets 946 741
Total assets $28,638 $25,663
======= =======
LIABILITIES
Debt $539 $259
Accounts payable 490 427
Employee-related
benefits 229 288
Income and mining
taxes 184 355
Other current
liabilities 1,998 1,418
----- -----
Current liabilities 3,440 2,747
Debt 3,771 4,182
Reclamation and
remediation
liabilities 1,032 984
Deferred income tax
liabilities 2,735 1,488
Employee-related
benefits 353 325
Other long-term
liabilities 314 221
Total liabilities 11,645 9,947
------ -----
Commitments and
contingencies
EQUITY
Common stock 780 778
Additional paid-in
capital 8,330 8,279
Accumulated other
comprehensive income 1,310 1,108
Retained earnings 3,908 3,180
----- -----
Newmont stockholders'
equity 14,328 13,345
Noncontrolling
interests 2,665 2,371
----- -----
Total equity 16,993 15,716
------ ------
Total liabilities and
equity $28,638 $25,663
======= =======
>>
Regional Operating Statistics
<<
Three Months Ended
June 30,
------------------
2011 2010
---- ----
Gold
----
Consolidated ounces produced
(thousands):
North America
Nevada 357 420
La Herradura 53 43
410 463
--- ---
South America
Yanacocha 342 353
>>
<<
Asia Pacific
Boddington 205 184
Batu Hijau 51 169
Other Australia/New Zealand 244 256
500 609
--- ---
Africa
Ahafo 146 132
1,398 1,557
===== =====
>>
<<
Copper
------
Consolidated pounds produced
(millions):
Asia Pacific
Boddington 16 15
Batu Hijau 58 133
74 148
=== ===
>>
<<
Gold
----
Attributable ounces produced
(thousands):
North America
Nevada 357 420
La Herradura 53 43
410 463
--- ---
South America
Yanacocha 175 181
Other South America Equity
Interests 18 -
193 181
--- ---
>>
<<
Asia Pacific
Boddington 205 184
Batu Hijau 26 82
Other Australia/New Zealand 244 256
Other Asia Pacific Equity
Interests 4 -
479 522
--- ---
Africa
Ahafo 146 132
1,228 1,298
===== =====
>>
<<
Copper
------
Attributable pounds produced
(millions):
Asia Pacific
Boddington 16 15
Batu Hijau 28 65
44 80
=== ===
>>
<<
Six Months Ended
June 30,
----------------
2011 2010
---- ----
Gold
----
Consolidated ounces produced
(thousands):
North America
Nevada 790 853
La Herradura 102 83
892 936
--- ---
South America
Yanacocha 630 776
>>
<<
Asia Pacific
Boddington 370 342
Batu Hijau 147 335
Other Australia/New Zealand 543 532
1,060 1,209
----- -----
Africa
Ahafo 332 252
2,914 3,173
===== =====
>>
<<
Copper
------
Consolidated pounds produced
(millions):
Asia Pacific
Boddington 30 29
Batu Hijau 146 278
176 307
=== ===
>>
<<
Gold
----
Attributable ounces produced
(thousands):
North America
Nevada 790 853
La Herradura 102 83
892 936
--- ---
South America
Yanacocha 323 398
Other South America Equity
Interests 30 -
353 398
--- ---
>>
<<
Asia Pacific
Boddington 370 342
Batu Hijau 72 170
Other Australia/New Zealand 543 532
Other Asia Pacific Equity
Interests 8 -
993 1,044
--- -----
Africa
Ahafo 332 252
2,570 2,630
===== =====
>>
<<
Copper
------
Attributable pounds produced
(millions):
Asia Pacific
Boddington 30 29
Batu Hijau 71 141
101 170
=== ===
>>
CAS and Capital Expenditures
<<
Three Months Ended June 30,
---------------------------
2011 2010
--- ---
Gold
----
Costs Applicable to Sales
($/ounce) (1)
North America
Nevada $636 $584
La Herradura 514 431
--- ---
620 570
--- ---
South America
Yanacocha 545 389
Asia Pacific
Boddington 641 582
Batu Hijau 490 294
Other Australia/New Zealand 638 533
>>
<<
620 491
--- ---
Africa
Ahafo 446 416
--- ---
Average $583 $485
==== ====
Attributable to Newmont $588 $507
==== ====
Copper
------
Costs Applicable to Sales
($/pound) (1)
Asia Pacific
Boddington $1.94 $1.55
Batu Hijau 1.23 0.66
>>
<<
Average $1.34 $0.77
===== =====
Attributable to Newmont $1.41 $0.86
===== =====
(1) Consolidated Costs
applicable to sales excludes
Amortization and Reclamation
and remediation.
>>
<<
Three Months Ended June 30,
---------------------------
2011 2010
--- ---
Consolidated Capital
Expenditures ($ million)
North America
Nevada $133 $69
Hope Bay 22 39
La Herradura 11 8
166 116
--- ---
South America
Yanacocha 86 28
Conga 187 26
273 54
--- ---
Asia Pacific
Boddington 26 33
Batu Hijau 48 5
Other Australia/New Zealand 72 35
Other Asia Pacific 2 1
148 74
--- ---
Africa
Ahafo 22 30
Akyem 39 16
61 46
--- ---
Corporate and Other 4 8
--- ---
Total - Accrual Basis $652 $298
--- ---
Change in Capital Accrual (34) 21
Total - Cash Basis $618 $319
==== ====
Attributable to Newmont (Accrual
Basis) $494 $269
--- ---
>>
<<
Six Months Ended June 30,
-------------------------
2011 2010
--- ---
Gold
----
Costs Applicable to Sales
($/ounce)
North America
Nevada $640 $592
La Herradura 456 389
--- ---
619 573
--- ---
South America
Yanacocha 561 380
Asia Pacific
Boddington 620 560
Batu Hijau 384 253
Other Australia/New Zealand 595 545
>>
<<
570 475
--- ---
Africa
Ahafo 449 475
--- ---
Average $570 $481
==== ====
Attributable to Newmont $575 $506
==== ====
Copper
------
Costs Applicable to Sales
($/pound)
Asia Pacific
Boddington $2.06 $1.80
Batu Hijau 1.07 0.66
>>
<<
Average $1.21 $0.78
===== =====
Attributable to Newmont $1.32 $0.88
===== =====
(1) Consolidated Costs
applicable to sales excludes
Amortization and Reclamation
and remediation.
>>
<<
Six Months Ended June 30,
-------------------------
2011 2010
--- ---
Consolidated Capital
Expenditures ($ million)
North America
Nevada $228 $117
Hope Bay 41 48
La Herradura 27 22
296 187
--- ---
South America
Yanacocha 127 68
Conga 251 43
378 111
--- ---
Asia Pacific
Boddington 75 81
Batu Hijau 88 33
Other Australia/New Zealand 134 71
Other Asia Pacific 4 3
301 188
--- ---
Africa
Ahafo 37 51
Akyem 67 22
104 73
--- ---
Corporate and Other 18 11
Total - Accrual Basis $1,097 $570
------ ---
Change in Capital Accrual (77) 58
Total - Cash Basis $1,020 $628
====== ====
Attributable to Newmont (Accrual
Basis) $868 $500
--- ---
Supplemental Information
Non-GAAP Financial Measures
>>
Non-GAAP financial measures are intended to provide additional information only and do not have any standard meaning prescribed by Generally Accepted Accounting Principles ('GAAP'). These measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
<<
Reconciliation of Adjusted Net Income to GAAP Net Income
>>
Management uses the non-GAAP financial measure Adjusted net income to evaluate the Company's operating performance, and for planning and forecasting future business operations. The Company believes the use of Adjusted net income allows investors and analysts to compare the results of the continuing operations of the Company and its direct and indirect subsidiaries relating to the production and sale of minerals to similar operating results of other mining companies, by excluding exceptional or unusual items, income or loss from discontinued operations and the permanent impairment of assets, including marketable securities and goodwill. Management's determination of the components of Adjusted net income are evaluated periodically and based, in part, on a review of non-GAAP financial measures used by mining industry analysts.
Net income attributable to Newmont stockholders is reconciled to Adjusted net income as follows:
<<
Three months ended
June 30,
--------
(in millions except per share,
after-tax) 2011 2010
------------------------------ ---- ----
GAAP Net income (1) $387 $382
Fronteer acquisition costs 17 -
PTNNT community contribution - -
Asset sales/impairments (30) (5)
Income tax benefit from internal
restructuring (65) -
Loss from discontinued operations 136 -
--------------------------------- --- ---
Adjusted net income $445 $377
=================== ==== ====
Adjusted net income per share,
basic $0.90 $0.77
============================== ===== =====
>>
<<
Six Months ended
June 30,
--------
(in millions except per share,
after-tax) 2011 2010
------------------------------ ---- ----
GAAP Net income (1) $901 $928
Fronteer acquisition costs 18 -
PTNNT community contribution - 13
Asset sales/impairments (32) (28)
Income tax benefit from internal
restructuring (65) (127)
Loss from discontinued operations 136 -
--------------------------------- --- ---
Adjusted net income $958 $786
=================== ==== ====
Adjusted net income per share,
basic $1.94 $1.60
============================== ===== =====
>>
<<
(1) Attributable to Newmont stockholders.
Costs Applicable to Sales per Ounce/Pound
>>
Costs applicable to sales per ounce/pound are non-GAAP financial measures. These measures are calculated by dividing the costs applicable to sales of gold and copper by gold ounces or copper pounds sold, respectively. These measures are calculated on a consistent basis for the periods presented on both a consolidated and attributable to Newmont basis. Attributable costs applicable to sales are based on our economic interest in production from our mines. For operations where we hold less than a 100% economic share in the production, we exclude the share of gold or copper production attributable to the non-controlling interest. We include attributable costs applicable to sales per ounce/pound to provide management, investors and analysts with information with which to compare our performance to other gold producers. Costs applicable to sales per ounce/pound statistics are intended to provide additional information only and do not have any standardized meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The measures are not necessarily indicative of operating profit or cash flow from operations as determined under GAAP. Other companies may calculate these measures differently.
Net attributable costs applicable to sales per ounce measures the benefit of copper produced in conjunction with gold, as a credit against the cost of producing gold. A number of other gold producers present their costs net of the contribution from copper and other non-gold sales. We believe that including a measure this basis provides management, investors and analysts with information with which to compare our performance to other gold producers, and to better assess the overall performance of our business. In addition, this measure provides information to enable investors and analysts to understand the importance of non-gold revenues to our cost structure.
Costs applicable to sales per ounce
<<
Three Months Ended June 30,
---------------------------
2011 2010
---- ----
>>
<<
Costs applicable to sales:
Consolidated per financial
statements $811 $750
Noncontrolling interests (1) (111) (92)
>>
<<
Attributable to Newmont $700 $658
==== ====
>>
<<
Gold sold (thousand ounces):
Consolidated 1,391 1,546
Noncontrolling interests (1) (201) (248)
---- ----
Attributable to Newmont 1,190 1,298
===== =====
>>
<<
Costs applicable to sales per
ounce:
Consolidated $583 $485
Attributable to Newmont $588 $507
>>
<<
Costs applicable to sales per pound
Three Months Ended June 30,
---------------------------
2011 2010
---- ----
>>
<<
Costs applicable to sales:
Consolidated per financial
statements $106 $98
Noncontrolling interests (1) (41) (38)
>>
<<
Attributable to Newmont $65 $60
=== ===
>>
<<
Copper sold (million pounds):
Consolidated 79 128
Noncontrolling interests (1) (33) (58)
Attributable to Newmont 46 70
=== ===
>>
<<
Costs applicable to sales per
pound:
Consolidated $1.34 $0.77
Attributable to Newmont $1.41 $0.86
>>
<<
Net attributable costs applicable
to sales per ounce
Three Months Ended June 30,
---------------------------
2011 2010
---- ----
>>
<<
Attributable costs applicable to
sales:
Gold $700 $658
Copper 65 60
>>
<<
765 718
--- ---
>>
<<
Copper revenue:
Consolidated (296) (298)
Noncontrolling interests (1) 125 133
(171) (165)
---- ----
Net attributable costs applicable
to sales $594 $553
==== ====
>>
<<
Attributable gold ounces sold
(thousands) 1,190 1,298
Net attributable costs applicable
to sales per ounce $499 $426
>>
<<
Six Months Ended June 30,
-------------------------
2011 2010
---- ----
>>
<<
Costs applicable to sales:
Consolidated per financial
statements $1,634 $1,503
Noncontrolling interests (1) (205) (185)
>>
<<
Attributable to Newmont $1,429 $1,318
====== ======
>>
<<
Gold sold (thousand ounces):
Consolidated 2,869 3,127
Noncontrolling interests (1) (383) (524)
Attributable to Newmont 2,486 2,603
===== =====
>>
<<
Costs applicable to sales per
ounce:
Consolidated $570 $481
Attributable to Newmont $575 $506
>>
<<
Costs applicable to sales per
pound
Six Months Ended June 30,
-------------------------
2011 2010
---- ----
>>
<<
Costs applicable to sales:
Consolidated per financial
statements $223 $214
Noncontrolling interests (1) (87) (81)
>>
<<
Attributable to Newmont $136 $133
==== ====
>>
<<
Copper sold (million pounds):
Consolidated 184 275
Noncontrolling interests (1) (81) (123)
Attributable to Newmont 103 152
=== ===
>>
<<
Costs applicable to sales per
pound:
Consolidated $1.21 $0.78
Attributable to Newmont $1.32 $0.88
>>
<<
Net attributable costs
applicable to sales per ounce
Six Months Ended June 30,
-------------------------
2011 2010
---- ----
>>
<<
Attributable costs applicable to
sales:
Gold $1,429 $1,318
Copper 136 133
>>
<<
1,565 1,451
----- -----
>>
<<
Copper revenue:
Consolidated (718) (792)
Noncontrolling interests (1) 315 343
(403) (449)
---- ----
Net attributable costs
applicable to sales $1,162 $1,002
====== ======
>>
<<
Attributable gold ounces sold
(thousands) 2,486 2,603
Net attributable costs
applicable to sales per ounce $467 $385
>>
<<
(1) Relates to partners' interests in Batu Hijau and Yanacocha
Conference Call Information:
>>
The second quarter conference call will be held on Friday, July 29, at 10:00 a.m. Eastern Time (8:00 a.m. Mountain Time) and it will also be carried on the Company's website.
<<
Conference Call Details
-----------------------
Dial-In Number 888.566.1822
Intl Dial-In Number 312.470.7065
Leader John Seaberg
Passcode Newmont
Replay Number 866.462.8985
Intl Replay Number 203.369.1370
Replay Passcode 2011
Webcast Details
---------------
URL http://www.newmont.com/our-investors
>>
The Second Quarter 2011 results and related financial and statistical information will be available prior to market open on July 29, 2011 on the 'Investor Relations' section of the Company's web site, www.newmont.com. Additionally, the conference call will be archived for a limited time on the Company's website.
<<
Cautionary Statement
>>
This release contains 'forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended which are intended to be covered by the safe harbor created by such sections and other applicable laws. Such forward-looking statements may include, without limitation: (i) estimates of future mineral production and sales; (ii) estimates of future costs applicable to sales; (iii) estimates of future capital expenditures; and (iv) expectations regarding the development, growth and exploration potential of the Company's projects, including, without limitation, Akyem. Estimates or expectations of future events or results are based upon certain assumptions, which may prove to be incorrect. Such assumptions, include, but are not limited to: (i) there being no significant change to current geotechnical, metallurgical, hydrological and other physical conditions; (ii) permitting, development, operations and expansion of the Company's projects being consistent with current expectations and mine plans; (iii) political developments in any jurisdiction in which the Company operates being consistent with its current expectations; (iv) certain exchange rate assumptions for the Australian dollar to the U.S. dollar, as well as other the exchange rates being approximately consistent with current levels; (v) certain price assumptions for gold, copper and oil; (vi) prices for key supplies being approximately consistent with current levels; and (vii) the accuracy of our current mineral reserve and mineral resource estimates. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, such statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by the 'forward-looking statements'. Such risks include, but are not limited to, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, political and operational risks in the countries in which we operate, and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company's 2010 Annual Report on Form 10-K, filed on February 24, 2011, with the Securities and Exchange Commission, as well as the Company's other SEC filings. The Company does not undertake any obligation to release publicly revisions to any 'forward-looking statement,' including, without limitation, outlook, to reflect events or circumstances after the date of this news release, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. Investors should not assume that any lack of update to a previously issued 'forward-looking statement' constitutes a reaffirmation of that statement. Continued reliance on 'forward-looking statements' is at investors' own risk.
<<
>>
Investors, John Seaberg, 1-303-837-5743, john.seaberg@newmont.com; or Karli Anderson, 1-303-837-6049, karli.anderson@newmont.com; or Monica Brisnehan, 1-303-837-5836, monica.brisnehan@newmont.com; or Media, Omar Jabara, 1-303-837-5114, omar.jabara@newmont.com, or Diane Reberger, 1-303-967-9455, diane.reberger@newmont.com Web Site: http://www.newmont.com