① The sharp rise in international gold prices since mid-February this year has also brought about an unexpected sharp rise in performance; ② The company maintains its 2024 gold production targets and cost expectations.
The world's largest gold mining company$Newmont (NEM.US)$The stock price surged 12.46% after the earnings report was released on Thursday, ranking first among the S&P 500 constituent stocks.
The sharp rise in international gold prices since mid-February this year is the key support of Newmont's earnings report. In just two months, the price of this yellow metal jumped from 2,000 US dollars/ounce to 2,400 US dollars.
Results show that sales in the first quarter of this year reached 4,023 billion US dollars, compared to 2,679 billion US dollars in the same period last year, of which gold sales rose from 2.3 billion US dollars to 3.3 billion US dollars. Gold production in the previous quarter also rose to 1.7 million ounces from 1.3 million ounces last year.
In terms of core operating indicators that mining stock investors are highly concerned about, Newmont disclosed that the average gold sales price in the Q1 quarter was 2,090 US dollars/ounce, 136 US dollars higher than the average price in 2023.
On the cost side, Q1's CAS index (applicable sales costs, including direct mining costs, mine site management costs, and some indirect costs such as mine maintenance) is 1,057 US dollars/ounce. At the same time, the more comprehensive AISC index (which reflects all costs required to maintain current production levels, including CAS and general administrative expenses, maintenance capital expenses, exploration, evaluation, etc.) is $1,439.
As a result, in the first quarter, Newmont's adjusted net profit reached 630 million US dollars, close to half of last year's profit for the full year, equivalent to 0.55 US dollars per share, which is far higher than the market's expectations of 0.36 US dollars.
For 2024, the company maintains its core business guidelines. This year's gold production will reach 6.9 million ounces, while the AISC is 1,400 US dollars/ounce.
In addition to the steady rise in its main business, Newmont also announced a “leverage reduction” plan to divest non-core assets and lay off employees. The company completed a nearly $17 billion acquisition of Australian mining company Newcrest in November last year. The company revealed in its financial report that it has now received US$105 million in collaborative revenue from the deal with Newcrest, and plans to achieve the goal of US$500 million in collaborative revenue per year by the end of 2025.
In an earnings conference call, Newmont CEO Tom Palmer revealed that the company has begun a formal (sale) process for 6 non-core assets, and the market is now very interested.
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