Gold mining giant
Newmont Mining Corporation
) reported its preliminary production results for 2013 that met
the higher end of its guidance. However, its shares fell as much
as 12% in the trading session following the announcement due to
somewhat downbeat guidance for 2014 that came below analysts'
expectations. The stock also took a hit after RBC Capital lowered
its rating on the company to "Underperform" from "Sector
Newmont's attributable gold production for fourth-quarter 2013
amounted to 1.448 million ounces compared with 1.251 million
ounces registered in fourth-quarter 2012. Attributable copper
production for fourth-quarter 2013 was 38 million pounds compared
with 35 million pounds in fourth-quarter 2012.
For full-year 2013, attributable gold production was 5.1
million ounces which stood at the top end of the guidance range
of 4.8 to 5.1 million ounces. This was comparable with 5 million
ounces that the company reported in 2012.
Attributable copper production for 2013 was 144 million pounds
(within the guidance range of 135-145 million ounces) compared
with 143 million pounds in the year ago. Throughout the year,
Newmont divested more than $600 million of non-core assets.
Newmont announced that it will apply a gold price of $1,300
per ounce, down from $1,400 a year ago, for all asset impairment
testing as well as for calculating gold reserves.
For 2014, Newmont expects consolidated gold production to be
in the range of 5 million and 5.3 million ounces and copper
production to be between 160,000 to 175,000 tons.
Newmont expects its all-in sustaining costs for 2014 to be
between $1,075 and $1,175 per gold ounce and $2.75 to $2.95 per
copper pound. It also expects a roughly 20% reduction in overhead
expenses. The company expects to invest about $1.3 to $1.4
billion in consolidated capital in 2014, of which roughly 90% is
allocated to sustaining capital.
Newmont, which is one of the prominent gold mining companies
Barrick Gold Corporation
), currently carries a Zacks Rank #3 (Hold).
A better-ranked stock in the gold mining industry is
Lake Shore Gold Corp.
) holding a Zacks Rank #2 (Buy).
BARRICK GOLD CP (ABX): Free Stock Analysis
GOLDCORP INC (GG): Free Stock Analysis Report
LAKE SHORE GOLD (LSG): Free Stock Analysis
NEWMONT MINING (NEM): Free Stock Analysis
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