Proactive Investors - Newmont Corporation (NYSE:NEM, TSX:NGT, ASX:NEM, ETR:NMM) shares surged more than 10% after the miner reported better-than-expected profits and gold production for the first quarter.
Adjusted profits nearly doubled from $320 million in the same period last year to $630 million.
Adjusted earnings per share were $0.55, up from $0.40 in the year-ago quarter ahead of the consensus estimate of $0.36.
Gold production was 1.67 million ounces, up from 1.27 million ounces in the year-ago quarter, boosted by its acquisitions of Newcrest Mining Limited (ASX:NCM)'s assets in November.
This marked a 4% decrease from the previous quarter due to a planned mill shutdown and seasonal rainfall impacts at Tanami and the ongoing stripping campaigns at Boddington and Akyem.
Analysts at Jefferies highlighted that quarterly gold production was above their estimate of 1.6 million ounces driven by strong performance at Lihir, Cadia, Yanacocha, and the company’s West African mines.
The company’s all in sustaining cost (AISC) was $1,439 per ounce, ahead of estimates of $1,453.
The Jefferies analysts attributed this to better-than-expected cost performance at Akyem, Ahafo, Yanacocha, Boddington, Red Chris and Merian, more than offsetting poor cost performance across its Canadian assets.
“Gold sales lagged production slightly, while the realized gold price of $2,090 per ounce was better than expected,” they wrote.
Newmont said it was on track to deliver its 2024 production guidance of 6.9 million ounces of gold at an AISC of $1,400 per ounce.
CEO Tom Palmer commented: "Underpinned by the gold industry's leading portfolio of Tier 1 gold and copper operations, we remain well-positioned to achieve our full-year guidance and deliver meaningful synergies and productivity improvements from the combined portfolio.”
The company also announced that it is selling the Lundin Gold stream credit facility and offtake agreement for $330 million, a move to further monetize its non-core assets.
The Jefferies analysts have a ‘Buy’ rating and a $45 price target on the stock.
Newmont shares added 10.3% at $42.60 late morning on Thursday.