Gold mining giant Newmont Mining CorporationNEM logged net income from continuing operations of $170 million or 32 cents per share in first-quarter 2018, more than two-fold surge from a net income of $70 million or 13 cents recorded a year ago. The bottom line in the reported quarter was boosted by higher realized gold prices .
Barring one-time items, adjusted earnings were 35 cents per share for the quarter, which beat the Zacks Consensus Estimate of 33 cents.
Newmont reported revenues of $1,817 million, up around 7.5% year over year. The figure however, missed the Zacks Consensus Estimate of $1,847.2 million.
Newmont Mining Corporation Price, Consensus and EPS Surprise
Newmont's attributable gold production decreased 2% year over year to 1.21 million ounces in the first quarter.
Average net realized gold price increased 9% to $1,326 per ounce from $1,219 an ounce a year ago. The average net realized copper price rose 7% to $2.88 per pound from $2.68 per pound.
Newmont's costs applicable to sales (CAS) for gold was $748 per ounce in the quarter, up 8% from year-ago quarter figure of $691 per ounce. Copper CAS was $1.74 per pound, up 16% year over year.
All-in sustaining costs (AISC) for gold rose 8% year over year to $973 per ounce.
Attributable gold production in North America in the first quarter was 490,000 ounces, declining 3% year over year. Consolidated copper production was 3,000 tons, down 25% from 4,000 tons recorded in the year-ago quarter.
Gold CAS for the region was $765 per ounce compared with $767 in the year-ago quarter. Copper CAS was $1.88 per pound, rising 4% year over year.
Attributable gold production in South America was 144,000 ounces, declining 4% year over year. Gold CAS for the region rose 20% to $782 per ounce.
Attributable gold and copper production in the region was 366,000 ounces, up 2% year over year. Gold CAS and copper CAS for this region was $707 per ounce, up 9% and $1.68 per pound, up 28%, respectively.
The region produced 209,000 ounces of gold in the reported quarter, down 5% year over year. Gold CAS was $746 per ounce, increasing 20%.
Net cash provided by continuing operating activities fell 29.1% year over year to $263 million in the first-quarter 2018. The company ended the quarter with roughly $3.1 billion cash in hand and also reduced total debt to $4,095 million in the first-quarter from $4,621 million a year ago.
Newmont continues to expect attributable gold production in the range of 4.9-5.4 million ounces for 2018 and 2019.
The company kept its AISC unchanged for 2018 at between $965 and $1,025 per ounce. CAS outlook for gold is also unchanged in the range of $700-$750 per ounce.
The company reiterated attributable copper production forecast for 2018 in the range of 40,000-60,000 tons.
Newmont's shares have inched up 1.1% over the last three months, outperforming the 6% decline recorded by its industry .
Zacks Rank & Stocks to Consider
Newmont currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the basic materials space include Steel Dynamics, Inc. STLD , United States Steel Corporation X and Kronos Worldwide Inc. KRO , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
Steel Dynamics has an expected long-term earnings growth rate of 12%. Its shares have soared 27.7% over a year.
U.S. Steel has an expected long-term earnings growth rate of 8%. Its shares have rallied 59.4% over a year.
Kronos has an expected long-term earnings growth rate of 5%. Its shares have surged 35.3% over a year.
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