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Newmont (NEM) Q3 Earnings and Sales Fall Short of Estimates
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Newmont Corporation (NEM - Free Report) reported earnings from continuing operations of 20 cents per share in third-quarter 2023 compared with earnings of 28 cents reported in the year-ago quarter.
Barring one-time items, adjusted earnings were 36 cents per share, up from 27 cents reported in the prior-year quarter. It lagged behind the Zacks Consensus Estimate of 42 cents.
The company’s revenues for the third quarter were $2,493 million, down around 5.4% year over year. The figure missed the Zacks Consensus Estimate of $3,199.5 million.
Newmont's third-quarter performance was impacted by higher costs and lower production.
Newmont Corporation Price, Consensus and EPS Surprise
Newmont's attributable gold production for the third quarter was 1.29 million ounces, registering a decline of 13.4% from 1.49 million ounces reported in the same period last year. The production in the quarter was lower than our estimate of 1.61 million ounces.
Average realized prices of gold rose around 13.5% year over year to $1,920 per ounce. It lagged our estimate of $1,947.
Newmont reported a rise in Costs Applicable to Sales (CAS) for gold, amounting to $1,019 per ounce, up 5.3% from the previous year’s levels. The primary factor contributing to this surge was lower gold sales volumes during the period.
All-in-sustaining costs (AISC) for gold were up around 12.2% year over year to $1,426 per ounce. This figure was higher than our estimate of $1,050 per.
Financials
The company ended the quarter with cash and cash equivalents of $3,190 million, up around 4.3% year over year. At the end of the quarter, the company had a long-term debt of $5,575 million, flat year over year.
The reported quarter's net cash from continuing operations amounted to $1,001 million.
Guidance
Newmont has updated its 2023 outlook for its standalone portfolio, expecting 5.3 million ounces of attributable production. This revision takes into account several factors, including the Penasquito strike, reduced production from the non-managed Nevada Gold Mines and Pueblo Viejo joint ventures, and decreased production at Ahafo due to the decision to operate at less than full capacity to safeguard one of the grinding mill's girth gears until it can be replaced. Consequently, it is anticipated that the 2023 CAS will be approximately $1,000 per ounce, with an AISC of $1,400 per ounce.
Additionally, the outlook for silver, lead, and zinc has been adjusted for the remainder of the year due to the impact of the Penasquito strike.
For 2023, the sustaining capital expenditure is projected to be $1.4 billion. This includes increased spending to enhance camp conditions at Musselwhite, adding five new autonomous haulage trucks at Boddington to advance stripping operations in the North and South Pits, and the replacement of a conveyor at Ahafo.
Price Performance
Newmont’s shares have lost 14.6% in the past year against a 14.8% rise of the industry.
The Zacks Consensus Estimate for ANDE's current-year earnings has been revised 3.3% upward in the past 90 days. Andersons beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4% on average. ANDE shares have rallied around 42.5% in a year.
In the past 60 days, the Zacks Consensus Estimate for WestRock’s current fiscal year has been revised upward by 5.2%. WRK beat the Zacks Consensus Estimate in three of the last four quarters while missing in one quarter, with the average earnings surprise being 30.7%. The company’s shares have rallied 1.3% in the past year.
The consensus estimate for Koppers’ current fiscal year earnings is pegged at $4.45, indicating year-over-year growth of 7.5%. KOP beat the Zacks Consensus Estimate in all of the last four quarters, with the average earnings surprise being 21.7%. The company’s shares have surged 44.2% in the past year.
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Newmont (NEM) Q3 Earnings and Sales Fall Short of Estimates
Newmont Corporation (NEM - Free Report) reported earnings from continuing operations of 20 cents per share in third-quarter 2023 compared with earnings of 28 cents reported in the year-ago quarter.
Barring one-time items, adjusted earnings were 36 cents per share, up from 27 cents reported in the prior-year quarter. It lagged behind the Zacks Consensus Estimate of 42 cents.
The company’s revenues for the third quarter were $2,493 million, down around 5.4% year over year. The figure missed the Zacks Consensus Estimate of $3,199.5 million.
Newmont's third-quarter performance was impacted by higher costs and lower production.
Newmont Corporation Price, Consensus and EPS Surprise
Newmont Corporation price-consensus-eps-surprise-chart | Newmont Corporation Quote
Operational Highlights
Newmont's attributable gold production for the third quarter was 1.29 million ounces, registering a decline of 13.4% from 1.49 million ounces reported in the same period last year. The production in the quarter was lower than our estimate of 1.61 million ounces.
Average realized prices of gold rose around 13.5% year over year to $1,920 per ounce. It lagged our estimate of $1,947.
Newmont reported a rise in Costs Applicable to Sales (CAS) for gold, amounting to $1,019 per ounce, up 5.3% from the previous year’s levels. The primary factor contributing to this surge was lower gold sales volumes during the period.
All-in-sustaining costs (AISC) for gold were up around 12.2% year over year to $1,426 per ounce. This figure was higher than our estimate of $1,050 per.
Financials
The company ended the quarter with cash and cash equivalents of $3,190 million, up around 4.3% year over year. At the end of the quarter, the company had a long-term debt of $5,575 million, flat year over year.
The reported quarter's net cash from continuing operations amounted to $1,001 million.
Guidance
Newmont has updated its 2023 outlook for its standalone portfolio, expecting 5.3 million ounces of attributable production. This revision takes into account several factors, including the Penasquito strike, reduced production from the non-managed Nevada Gold Mines and Pueblo Viejo joint ventures, and decreased production at Ahafo due to the decision to operate at less than full capacity to safeguard one of the grinding mill's girth gears until it can be replaced. Consequently, it is anticipated that the 2023 CAS will be approximately $1,000 per ounce, with an AISC of $1,400 per ounce.
Additionally, the outlook for silver, lead, and zinc has been adjusted for the remainder of the year due to the impact of the Penasquito strike.
For 2023, the sustaining capital expenditure is projected to be $1.4 billion. This includes increased spending to enhance camp conditions at Musselwhite, adding five new autonomous haulage trucks at Boddington to advance stripping operations in the North and South Pits, and the replacement of a conveyor at Ahafo.
Price Performance
Newmont’s shares have lost 14.6% in the past year against a 14.8% rise of the industry.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
Newmont currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Basic Materials space are The Andersons Inc. (ANDE - Free Report) , carrying a Zacks Rank #1 (Strong Buy), and WestRock Company and Koppers Holdings Inc. (KOP - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for ANDE's current-year earnings has been revised 3.3% upward in the past 90 days. Andersons beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4% on average. ANDE shares have rallied around 42.5% in a year.
In the past 60 days, the Zacks Consensus Estimate for WestRock’s current fiscal year has been revised upward by 5.2%. WRK beat the Zacks Consensus Estimate in three of the last four quarters while missing in one quarter, with the average earnings surprise being 30.7%. The company’s shares have rallied 1.3% in the past year.
The consensus estimate for Koppers’ current fiscal year earnings is pegged at $4.45, indicating year-over-year growth of 7.5%. KOP beat the Zacks Consensus Estimate in all of the last four quarters, with the average earnings surprise being 21.7%. The company’s shares have surged 44.2% in the past year.