NEWMONT Corp /DE/ Q3 FY2024 earnings call

Safety

• Remembered Antoine Fortin, committed to improving safety culture and sharing lessons with the industry to enhance safety performance.

Sustainability

• Appointed Chair of ICMM, supporting consolidated mining standards. Partnered with MKS PAMP to launch a traceable gold bar in the US.

Operations

• Managed portfolio delivered 4% more gold in Q3 than Q2, expected 1.8 million ounces in Q4. Key operations had updates: Tanami accessing higher grades, Boddington stripping, Penasquito ramping up production, Cadia transitioning to Panel Cave 2-3, Lihir planning autoclave shutdown, Brucejack working on nuggety orebody, Ahafo South increasing production, and projects like Tanami expansion, Ahafo North construction, and Cadia Panel Caves progressing.

Capital Returns

• Retired $233 million in debt, returned $786 million to shareholders via repurchases and dividends. Approved $2 billion share repurchase program, total authorization $3 billion.

In the third quarter, Newmont produced nearly 1.7 million ounces of gold and 430,000 gold equivalent ounces from copper, silver, lead, and zinc. The non-core divestment program advanced, with two transactions expected to deliver up to $1.5 billion in combined gross proceeds. The company generated $1.6 billion of cash flow from operations and $760 million in free cash flow. Synergies: Achieved a $500 million synergy run rate, with $100 million from G&A, $200 million from supply chain, and $200 million from the full potential program.

Production

• Expected 1.8 million ounces of gold in Q4, on track to meet full-year production guidance. 2025 gold production from go forward Tier 1 portfolio largely consistent with 2024, but lower from Lihir and Brucejack.

Costs

• All-in sustaining costs expected $14.75/ounce in Q4, 8% lower than Q3. 2025 unit costs to align with 2024 trends.

Investment

• Focus on 11 managed operations and three projects in execution, disciplined with capital allocation, prioritizing margin expansion over volume chasing.

• Safety: Fifth fatality in less than a year at Illinois operation, working to improve safety systems and culture.
• Operational: Lihir and Brucejack production lower than initial guidance due to asset reliability and development work. Cadia sustaining capital spend higher due to tailings facility repairs and expansions.

Q: Reflection on industry cost expectations A: Tom and Karyn discussed the correlation between gold price and production costs, emphasizing focus on margins from 11 managed operations.

Q: 2025 production guidance A: Tom explained lower production from Lihir and Brucejack, core portfolio production around 5.6 million ounces in 2025.

Q: Cost inflation and synergies A: Thomas and Karyn talked about labor cost escalations, synergies achieved, and how costs flow into 2025.

Q: Asset-by-asset guidance timeline A: Tom stated more formal asset-by-asset guidance to come early next year after divestment clarity.

Q: Cadia and Cerro Negro approvals A: Karyn and Natascha discussed ongoing permits and productivity focus for Cadia and Cerro Negro.

Q: Capital allocation and Wafi-Golpu A: Thomas mentioned working on MOU with PNG government for Wafi-Golpu, disciplined capital allocation to existing projects first.

Q: Labor inflation and contractor costs A: Thomas and Tanya discussed labor cost trends, with contractor inflation rates slowing into 2025.

Q: Mid-term production outlook A: Tom outlined mid-term target of around 6 million ounces of gold and 150,000 tons of copper from 11 managed operations and three projects