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Sep 30, 2020
Newmont Q3 2020 Earnings Report
Newmont delivered record adjusted EBITDA and free cash flow, capitalizing on its robust portfolio and higher gold prices.
Key Takeaways
Newmont Corporation announced record third quarter 2020 results, driven by strong performance from its world-class assets and higher gold prices. The company reported adjusted EBITDA of $1.7 billion and free cash flow of $1.3 billion, marking the best quarterly financial performance in its history. Newmont remains focused on protecting the health and safety of its workforce and neighboring communities amidst the ongoing pandemic.
Produced 1.5 million attributable ounces of gold and 273 thousand attributable gold equivalent ounces from co-products.
Generated $1.6 billion of cash from continuing operations and $1.3 billion of Free Cash Flow.
Reported $4.8 billion of consolidated cash with $7.8 billion of liquidity and a net debt to adjusted EBITDA ratio of 0.4x.
Declared third quarter dividend of $0.40 per share, an increase of 60 percent over the prior quarter.
Newmont
Newmont
Forward Guidance
Newmont's 2020 attributable gold production is unchanged at approximately 6.0 million ounces and the Company expects to produce approximately 1.0 million gold equivalent ounces from co-products. Gold CAS is expected to be $760 per ounce, and gold AISC is expected to be $1,015 per ounce. Newmont's capital expenditure for 2020 is expected to be approximately $1.4 billion.
Positive Outlook
- Full Potential at Boddington improves mining rates and grade increases throughout remainder of 2020 with the three year stripping campaign nearing completion in the South Pit.
- Tanami continues to deliver solid performance.
- Africa benefits from a full year of production from the Ahafo Mill Expansion.
- Musselwhite Materials Handling project is 95 percent complete and the conveyor system is on track to be fully commissioned by year end.
- South America region remains on track to achieve full year 2020 guidance.
Challenges Ahead
- Covid-related impacts at Yanacocha, Cerro Negro and Éléonore as the operations continued to ramp up in the third quarter from care and maintenance.
- Mine sequencing in both the Subika and Awonsu open pits, a change in mining method at Subika Underground and lower grades at Akyem impacts Africa production.
- 2020 outlook includes the impacts from Peñasquito, Éléonore and Musselwhite being temporarily placed into care and maintenance in the second quarter.
- Éléonore production and cost outlook reflects the ongoing work to integrate the geotechnical model and updated Reserves.
- Ongoing Covid-related constraints in Argentina that restricts Cerro Negro operations which are at approximately 65 percent of normal capacity.