Summary
Newmont Mining Corporation (NEM) reported its second quarter and first half results for the period ending June 29, 2011. The company demonstrated strong sales growth, with consolidated sales increasing by 11% and 10% for the respective periods compared to 2010, driven by significantly higher realized gold and copper prices. Despite an increase in costs applicable to sales, particularly for gold, driven by factors like waste mining activities and a stronger Australian dollar, Newmont managed to maintain profitability. A significant development during the period was the completion of the acquisition of Fronteer Gold, Inc. in April 2011, which is expected to add strategic value through potential synergies. The company also continues to advance its project pipeline, with updates on Conga, Akyem, Hope Bay, and Long Canyon, signaling a focus on future production growth. Dividends paid to common stockholders saw an increase, reflecting the company's gold price-linked dividend policy.
Financial Highlights
54 data points| Gross Profit | $1.17B |
| R&D Expenses | $86.00M |
| Operating Expenses | $1.52B |
| Operating Income | $523.00M |
| Interest Expense | $63.00M |
| Net Income | $387.00M |
| EPS (Basic) | $0.78 |
| EPS (Diluted) | $0.77 |
| Shares Outstanding (Basic) | 494.00M |
| Shares Outstanding (Diluted) | 501.00M |
Key Highlights
- 1Consolidated sales increased by 11% and 10% for the three and six months ended June 30, 2011, compared to the prior year periods, primarily driven by higher realized gold and copper prices.
- 2Net income attributable to Newmont stockholders was $387 million for the second quarter of 2011 ($0.78 per share) and $901 million for the first half ($1.82 per share), showing resilience despite increased costs and a significant loss from discontinued operations.
- 3The company completed the acquisition of Fronteer Gold, Inc. for $2,259 million, which includes the Long Canyon project in Nevada, expected to provide development and operating synergies.
- 4Capital expenditures increased significantly to $1,020 million in the first half of 2011 from $628 million in the prior year, reflecting investments in property, plant, and mine development, including advancements on key projects.
- 5The company announced an increase in its quarterly dividend to $0.30 per share for the third quarter of 2011, based on its gold price-linked dividend policy, reflecting an improvement in gold prices.
- 6A $136 million loss from discontinued operations was recorded due to an unfavorable ruling related to the Holt property royalty in Canada.
- 7Despite a 10% decrease in consolidated gold production and a 50% decrease in copper production in the second quarter, driven by lower grades and processing of stockpiled material, the company's sales increased due to higher commodity prices.