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8-K - NEWMONT Corp /DE/ | v175514_8k.htm |
EX-99.2 - NEWMONT Corp /DE/ | v175514_ex99-2.htm |
Newmont
Mining Corporation
6363
South Fiddlers Green Circle, Suite 800
Greenwood
Village, CO 80111
T 303.863.7414
F 303.837.5837
www.newmont.com
|
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Newmont Reports Record Operating Cash
Flow of $2.9 Billion and Adjusted Net Income(1) of $1.4 Billion ($2.79 per Share) in
2009
DENVER, February
25, 2010 – Newmont Mining Corporation (NYSE: NEM) (“Newmont” or “the Company”)
today announced record operating cash flow of $2.9 billion and adjusted net
income of $1.4 billion ($2.79 per share) in 2009 on record revenues of $7.7
billion from equity gold sales of 5.3 million ounces at costs applicable to
sales of $417 per ounce. Record revenues of $2.5 billion were
generated in the fourth quarter, with $1.0 billion in operating cash flow
generated on equity gold sales of 1.5 million ounces at costs applicable to
sales of $413 per ounce.
2009
Highlights:
|
q
|
Net cash from
continuing operations of $2.9 billion, up 109% from
2008;
|
|
q
|
Adjusted net
income(1)
of $1.4 billion ($2.79 per share), up 72% from
2008;
|
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q
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Revenues of
$7.7 billion, up 26% from 2008, on average realized gold price of $977 per
ounce and average realized copper price of
$2.60;
|
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q
|
Equity gold
sales of 5.3 million ounces and equity copper sales of 226 million
pounds;
|
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q
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Costs
applicable to sales for gold of $417 per ounce, down 4% from
2008;
|
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q
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Costs
applicable to sales for copper of $0.64 per pound, down 54% from
2008;
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q
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Equity gold
sales and costs applicable to sales in line with original 2009
outlook;
|
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q
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Gold
operating margin(2)
increased 28% on a gold price increase of
12%;
|
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q
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Acquisition
of remaining 33.3% of Boddington;
|
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q
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Raised $1.7
billion of equity and convertible debt to fund the Boddington
acquisition;
|
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q
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Successful
offering of $2.0 billion of unsecured debt;
and
|
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q
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Commercial
production achieved at Boddington.
|
“The combination of
slightly higher production, lower costs and gold price leverage generated cash
flow from operations of $2.9 billion on record revenues of $7.7 billion, while
our gold operating margin expanded to 57%,” said Richard O’Brien, President and
Chief Executive Officer. “With the completion of construction of Boddington late
last year, we now turn our attention to the development of our next generation
of projects, including Akyem in Ghana, Conga in Peru, Hope Bay in Canada and our
portfolio of growth projects in Nevada.”
(1) See
reconciliation of adjusted net income to GAAP net income on page
12.
(2 ) “Gold
operating margin” defined as average realized price per ounce less costs
applicable to sales per ounce, excluding amortization and accretion per
ounce.
Page 1 of 14 |
Fourth
Quarter Highlights:
For the fourth
quarter of 2009, the Company reported equity gold sales of 1.5 million ounces at
costs applicable to sales of $413 per ounce. Equity gold sales were
higher than expected in Nevada, at Yanacocha in Peru and at Ahafo in Ghana,
offset by lower than expected sales from Boddington in
Australia. Costs applicable to sales were in line with
expectations.
|
q
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Net cash from
continuing operations of $1.0 billion, up 323% from
2008;
|
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q
|
Adjusted net
income(1)
of $561 million ($1.14 per share), up 379% from
2008;
|
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q
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Revenues of
$2.5 billion, up 90% from a year ago, on average realized gold price of
$1,102 per ounce and average realized copper price of
$3.24;
|
|
q
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Equity gold
sales of 1.5 million ounces and equity copper sales of 72 million
pounds;
|
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q
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Costs
applicable to sales for gold of $413 per ounce, down 7% from a year
ago;
|
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q
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Costs
applicable to sales for copper of $0.64 per pound, down 2% from a year
ago;
|
|
q
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Gold
operating margin(2)
increased 145% on a gold price increase of 38%;
and
|
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q
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Commercial
production achieved at Boddington.
|
Summary
of 2010 Outlook:
Equity gold
production is expected to increase slightly to between 5.3 and 5.5 million
ounces, primarily as a result of the continuing 12-month ramp-up to full
production of Boddington, partially offset by lower production from Nevada and
Yanacocha, as described below. The Company expects 2010 gold costs
applicable to sales to increase slightly to between $450 and $480 per ounce
accounting for Boddington on a co-product basis, or to between $440 to $470 per
ounce on a by-product basis, due to lower production from Nevada and
Yanacocha. The Company accounts for Boddington on a co-product basis
due to the significant revenues from copper. The Company’s costs applicable to
sales outlook assumes an average oil price of $80 per barrel and an average
Australian dollar exchange rate of $0.80. Costs applicable to sales
in 2010, inclusive of hedges, are expected to change by approximately $6 per
ounce for every $10 change in the oil price and by approximately $7 per ounce
for every $0.10 change in the Australian dollar exchange rate.
In
2010, the Company anticipates consolidated capital expenditures to decline by
approximately 15% from 2009 to between $1.4 and $1.6 billion ($1.2 to $1.4
billion on an equity basis) due to the completion of Boddington in 2009, offset
partially by approximately $0.6 billion (on a consolidated basis) of investment
in the next generation of major projects, including Akyem in Ghana, Conga in
Peru, Hope Bay in Canada and the portfolio of growth projects in Nevada, as
described further below. The remaining capital expenditures in 2010
are expected to be associated with maintenance and sustaining
expenditures.
Regional
Operations and Outlook:
North
America
Nevada – Nevada sold 567,000 equity ounces of gold at costs
applicable to sales of $495 per
ounce during the fourth quarter. Equity gold sales were above
expectations due to higher grade from the underground operations and improved
leach pad recoveries. During the quarter, costs applicable to sales
were lower than expected as higher production was partially offset by higher
underground mining costs and production taxes. Equity sales for the
year were 2.0 million
ounces at costs applicable to sales of $521 per ounce.
(1) See
reconciliation of adjusted net income to GAAP net income on page
12.
(2) “Gold
operating margin” defined as average realized price per ounce less costs
applicable to sales per ounce, excluding amortization and accretion per
ounce.
Page 2 of 14 |
In
2010, the Company expects equity gold production from Nevada of approximately
1.6 to 1.7 million ounces
due to lower production from the Carlin operations and the closure of
Deep Post, partially offset by increased production at
Leeville. Production from the Carlin operations is expected to be
impacted by a geotechnical event that occurred at Gold Quarry in late December
2009, limiting access to ore that was originally scheduled to be mined in 2010
and 2011. Following a series of geotechnical, mine planning and ore
blending analyses conducted by the Company in January and February 2010, the
Company now expects up to approximately 150,000 equity ounces of gold production
to be deferred from Gold Quarry in 2010 and 2011. The Company currently
anticipates mining these deferred ounces in 2012 and 2013, while continuing to
study opportunities to safely accelerate that production. 2010 costs
applicable to sales in Nevada are expected to increase to between $590 and $630 per ounce,
primarily due to lower production and higher contracted mining costs, diesel and
input commodity price assumptions.
La
Herradura –
Equity gold sales at La Herradura in Mexico during the fourth quarter were 34,000 ounces at costs
applicable to sales of $351 per
ounce. Equity gold sales were higher than expected due to
higher leach placement. Costs applicable to sales were lower than
expected due to higher sales and by-product credits. Equity gold
sales for the year were 113,000
ounces at costs applicable to sales of $372 per ounce. La Herradura
equity gold production is expected to reach 140,000 to 150,000 ounces in
2010 with costs applicable to sales of between $400 and $430 per
ounce.
For 2011(3),
equity gold production in the North America region is expected to remain at 2010
levels, with the potential for slightly higher production in 2012, primarily due
to higher production from underground and open pits from the Nevada Growth
projects as well as higher production from La Herradura in Mexico and mining of
the deferred ounces at Gold Quarry in Nevada. Costs applicable to
sales in 2011 and 2012 are expected to remain near 2010 levels, with the
potential of decreasing with the addition of the growth projects in Nevada and
La Herradura production.
South
America
Yanacocha
– Equity gold sales during the fourth quarter at Yanacocha in Peru were 262,000 ounces at costs applicable to
sales of $303 per ounce. Equity
gold sales were slightly below expectations due to lower leach production,
offset in part by higher mill production due to higher grades and
recoveries. Costs applicable to sales were slightly higher than
expected due to higher royalties and workers’ participation from higher realized
gold prices, partially offset by higher gold sales and by-product
credits. Equity gold sales for the year were 1.06 million ounces at costs
applicable to sales of $311 per
ounce.
Equity gold
production at Yanacocha is anticipated to decrease from 2009 levels to between
750,000 and 810,000 ounces in
2010, primarily due to lower ore tons mined and lower
grades. Costs applicable to sales are anticipated to increase to
between $360 and $400 per ounce
due to lower production and higher contracted services and
supplies.
Equity gold
production and costs applicable to sales in the South America region in 2011 and
2012(3) are
expected to remain near 2010 levels. As the Company continues to
advance the Conga project toward a final development decision in 2010,
permitting dependant, the anticipated first production at Conga in the late 2014
to 2015 timeframe could add, on a 100% basis, annual gold production
of approximately 650,000 to 750,000 ounces, as well as annual copper production
of up to 160 to 210 million pounds during the first five years of steady-state
operations at average costs applicable to sales of approximately $300 to $400
per ounce and $0.95 to $1.25 per pound, respectively.
Asia
Pacific
Boddington – At Boddington, ramp-up to
full production in the plant is proceeding according to plan. Equity
gold sales during the fourth quarter were 103,000 ounces at costs
applicable to sales of $468 per
ounce ($352 per ounce on a by-product basis). Equity gold production is
anticipated to reach 800,000 to
875,000 ounces in 2010 with costs applicable to sales of $375 to $395 per ounce on a
co-product basis ($295 to $315 per ounce on a by-product
basis). After ramping up to full production, we continue to expect
Boddington’s first five years of annual production to average approximately 1.0
million ounces. Additionally, in 2010 equity copper production at Boddington is
anticipated to reach 65 to 75
million pounds at costs applicable to sales of between $1.30 and $1.45 per
pound.
(3) All
references to expected production at each of our operations and regions are
based on current mine plans, assumptions and current geotechnical,
metallurgical, hydrological and other physical conditions.
Page 3 of 14 |
Other
Australia/New Zealand - Equity gold sales
during the fourth quarter were 292,000 ounces at costs applicable to
sales of $528 per
ounce. Equity gold sales met expectations as higher production
at Jundee was offset by lower production at Tanami. Costs applicable
to sales were in line with expectations. Equity gold sales for the
year were 1.2 million
ounces at costs applicable to sales of $512 per
ounce. Equity gold production at the Company’s other
Australian/New Zealand operations in 2010 is expected to be between 1.06 and 1.16 million ounces
at costs applicable to sales of $530 to $570 per
ounce.
Batu
Hijau – Equity gold and copper sales during the fourth quarter at Batu
Hijau in Indonesia were 68,000
ounces and 63 million
pounds at costs applicable to sales of $175 per ounce and $0.58 per pound, respectively.
Equity gold and copper sales met expectations as did costs applicable to
sales. Equity gold and copper sales for the year were 239,000 ounces and 217 million pounds at costs
applicable to sales of $214 per
ounce and $0.62 per
pound, respectively.
2010 equity gold
production at Batu Hijau, assuming the current economic interest of 52.44%, is
expected to increase to between 390,000 and 425,000 ounces,
primarily due to a higher economic interest and higher ore grades as mining
occurs in the bottom of Phase 5. Costs applicable to sales are
expected to increase to between $265 and $285 per ounce due to
higher waste stripping. Equity copper production is expected to
increase to be between 285 and
310 million pounds at costs applicable to sales of between $0.75 and $0.85 per
pound.
Equity gold
production in the Asia Pacific region in 2011 and 2012(3) is
expected to remain near 2010 levels, primarily due to increased production at
Boddington and extended mine-life at Jundee and Waihi, offsetting declining
production at Tanami and Batu Hijau. Over the same period, costs
applicable to sales are anticipated to increase as lower cost production from
Boddington will be offset by higher costs at Batu Hijau in Indonesia as the
Company continues stripping Phase 6.
Africa
Ahafo
– Equity gold sales during the fourth quarter at Ahafo in Ghana were 134,000 ounces at costs
applicable to sales of $506 per
ounce. Equity gold sales were higher than expected due to a
drawdown of finished goods inventory. Costs applicable to sales were
higher than expected due to higher labor, contracted services and maintenance
costs. Equity sales for the year were 546,000 ounces at costs
applicable to sales of $444 per
ounce.
2010 equity gold
production at Ahafo is expected to decline to between 460,000 and 500,000 ounces due
to mining additional waste material and lower ore grade. Costs
applicable to sales are anticipated to increase to $515 to $555 per ounce,
primarily as a result of lower production, higher diesel price assumptions and
higher labor and royalty costs.
Equity gold
production and costs applicable to sales in the Africa region in 2011 and
2012(3) are
expected to remain near 2010 levels. With the granting of the required mining
license earlier this year, the Company is advancing the development of Akyem.
First production is currently anticipated in late 2013 to 2014 with the addition
of up to 480,000 to 550,000 equity gold ounces annually during the first five
years of operation at costs applicable to sales of between $350 and $450 per
ounce. Additionally, the potential future development of the Subika underground
project should sustain production at Ahafo at 2010 levels. Collectively, the
addition of potential production from the Akyem and Subika underground projects
could more than double the Company’s equity gold sales in Ghana over the next
five years.
(3) All
references to expected production at each of our operations and regions are
based on current mine plans, assumptions and current geotechnical,
metallurgical, hydrological and other physical conditions.
Page 4 of 14 |
Consolidated
Capital Expenditures Update:
Consolidated
capital expenditures were $455 million during the fourth quarter, with
approximately 33% related to completion of the Boddington project in
Australia. For the year, the Company’s consolidated capital
expenditures were approximately $1.8 billion, approximately 62% of which was
related to Boddington.
For 2010, the
Company anticipates lower consolidated capital expenditures of between $1.4 and
$1.6 billion ($1.2 to $1.4 billion on an equity basis) with approximately 30% to
be invested in each of the North America and Asia Pacific regions, and the
remaining 40% at other locations. Approximately 40% of the 2010
capital is expected to be related to major project initiatives, including
further development of the Akyem project in Ghana, the Conga project in Peru,
Hope Bay in Canada and other projects, while the remaining 60% is expected to be
for maintenance and sustaining expenditures.
2010
Operating and Financial Outlook(3):
2010 Outlook
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2010 Outlook
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2010 Outlook
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Region
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Equity Production
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CAS
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Consolidated Capital
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(Kozs, Mlbs)
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($/oz, $/lb)
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Expenditures ($M)
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Nevada
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1,600 – 1,725
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$590 – $630
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$355 – $375
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La Herradura
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140 – 150
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$400 – $430
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$55 – $65
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Hope Bay
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$65 – $75
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North America
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1,740 – 1,885
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$575 – $615
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$475 – $515
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Yanacocha
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750 – 810
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$360 – $400
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$165 – $175
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Conga
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$155 – $165
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South America
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750 – 810
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$360 – $400
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$320 – $340
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Boddington 1
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800 – 875
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$375 – $395
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$140 – $155
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Other Australia/NZ
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1,060 – 1,160
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$530 – $570
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$210 – $225
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Batu Hijau 2
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390 – 425
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$265 – $285
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$110 – $130
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Asia Pacific
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2,250 – 2,460
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$400 – $440
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$460 – $510
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Ahafo
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460 – 500
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$515 – $555
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$120 – $130
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Akyem
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$95 – $105
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Africa
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460 – 500
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$515 – $555
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$215 – $235
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Corporate/Other
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$48 – $52
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Total Gold
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5,300 – 5,500
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$450 – $480
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$1,400 – $1,600
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Boddington – Copper
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65 – 75
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$1.30 – $1.45
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Batu Hijau – Copper 2
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285 – 310
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$0.75 – $0.85
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Total Copper
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350 – 380
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$0.85 – $0.95
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1
Boddington shown on a co-product basis.
2 Assumes
Batu Hijau economic interest of 52.44%.
The 2010 outlook
for costs applicable to sales with Boddington on a by-product basis would be
$295 to $315 per ounce, $375 to $415 per ounce for the Asia Pacific region and
$440 to $470 per ounce for the Company, with no Boddington copper revenue or
CAS.
(3) All
references to expected production at each of our operations and regions are
based on current mine plans, assumptions and current geotechnical,
metallurgical, hydrological and other physical
conditions.
Page 5 of 14 |
The following table
sets out the Company’s financial outlook for 2010 and corresponding outlook
assumptions.
Description
|
2010 Outlook
($M)
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General & Administrative
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$160 – $170
|
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Interest Expense
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$270 – $290
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DD&A
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$940 – $970
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Exploration Expense
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$190 – $220
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Advanced Projects & R&D
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$185 – $210
|
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Tax Rate
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28% – 32%
|
|
Assumptions
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Gold Price
($/ounce)
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$900
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Copper Price
($/pound)
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$2.50
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Oil Price
($/barrel)
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$80
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Australian
Dollar Exchange Rate
|
$0.80
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Page 6 of 14 |
Statements of
Consolidated Income
Three Months Ended December 31,
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Twelve Months Ended December 31,
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|||||||||||||||
2009
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2008
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2009
|
2008
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|||||||||||||
(in millions, except per share)
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||||||||||||||||
(unaudited)
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(audited)
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|||||||||||||||
Revenues
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||||||||||||||||
Sales - gold,
net
|
$ | 1,985 | $ | 1,278 | $ | 6,386 | $ | 5,372 | ||||||||
Sales -
copper, net
|
533 | 47 | 1,319 | 752 | ||||||||||||
2,518 | 1,325 | 7,705 | 6,124 | |||||||||||||
Costs and
expenses
|
||||||||||||||||
Costs applicable to sales -
gold
(1)
|
743 | 712 | 2,726 | 2,681 | ||||||||||||
Costs applicable to sales -
copper
(1)
|
106 | 57 | 323 | 399 | ||||||||||||
Amortization
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240 | 190 | 806 | 738 | ||||||||||||
Accretion
|
9 | 8 | 34 | 31 | ||||||||||||
Exploration
|
40 | 59 | 187 | 213 | ||||||||||||
Advanced
projects, research and development
|
35 | 53 | 135 | 166 | ||||||||||||
General and
administrative
|
41 | 41 | 159 | 144 | ||||||||||||
Write-down of
property, plant and mine development
|
4 | 135 | 7 | 137 | ||||||||||||
Other expense,
net
|
127 | 104 | 383 | 351 | ||||||||||||
1,345 | 1,359 | 4,760 | 4,860 | |||||||||||||
Other income
(expense)
|
||||||||||||||||
Other income,
net
|
45 | 23 | 88 | 123 | ||||||||||||
Interest
expense, net
|
(55 | ) | (37 | ) | (120 | ) | (135 | ) | ||||||||
(10 | ) | (14 | ) | (32 | ) | (12 | ) | |||||||||
Income from
continuing operations before income tax and other items
|
1,163 | (48 | ) | 2,913 | 1,252 | |||||||||||
Income tax
expense
|
(294 | ) | 93 | (788 | ) | (100 | ) | |||||||||
Equity income
(loss) of affiliates
|
(2 | ) | 1 | (16 | ) | (5 | ) | |||||||||
Income from
continuing operations
|
867 | 46 | 2,109 | 1,147 | ||||||||||||
Income (loss)
from discontinued operations
|
(2 | ) | (4 | ) | (16 | ) | 13 | |||||||||
Net
income
|
865 | 42 | 2,093 | 1,160 | ||||||||||||
Net income
attributable to noncontrolling interests
|
(307 | ) | (38 | ) | (796 | ) | (329 | ) | ||||||||
Net income
attributable to Newmont stockholders
|
$ | 558 | $ | 4 | $ | 1,297 | $ | 831 | ||||||||
Net income
attributable to Newmont stockholders:
|
||||||||||||||||
Continuing
operations
|
$ | 560 | $ | 8 | $ | 1,308 | $ | 816 | ||||||||
Discontinued
operations
|
(2 | ) | (4 | ) | (11 | ) | 15 | |||||||||
$ | 558 | $ | 4 | $ | 1,297 | $ | 831 | |||||||||
Net income per
common share
|
||||||||||||||||
Basic:
|
||||||||||||||||
Continuing
operations
|
$ | 1.14 | $ | 0.02 | $ | 2.68 | $ | 1.80 | ||||||||
Discontinued
operations
|
- | (0.01 | ) | (0.02 | ) | 0.03 | ||||||||||
$ | 1.14 | $ | 0.01 | $ | 2.66 | $ | 1.83 | |||||||||
Diluted:
|
||||||||||||||||
Continuing
operations
|
$ | 1.13 | $ | 0.02 | $ | 2.68 | $ | 1.80 | ||||||||
Discontinued
operations
|
- | (0.01 | ) | (0.02 | ) | 0.03 | ||||||||||
$ | 1.13 | $ | 0.01 | $ | 2.66 | $ | 1.83 | |||||||||
Basic
weighted-average common shares outstanding
|
491 | 454 | 487 | 454 | ||||||||||||
Diluted
weighted-average common shares outstanding
|
493 | 455 | 487 | 455 | ||||||||||||
Cash dividends
declared per common share
|
$ | 0.10 | $ | 0.10 | $ | 0.40 | $ | 0.40 |
(1) Exclusive
of Amortization and Accretion.
The
Company’s financial statements can be found on its website at www.newmont.com.
Page 7 of 14 |
Consolidated
Balance Sheets
At December 31,
|
||||||||
2009
|
2008
|
|||||||
(audited, in millions)
|
||||||||
ASSETS
|
||||||||
Cash and cash
equivalents
|
$ | 3,215 | $ | 435 | ||||
Trade
receivables
|
438 | 104 | ||||||
Accounts
receivable
|
102 | 214 | ||||||
Investments
|
56 | 12 | ||||||
Inventories
|
493 | 507 | ||||||
Stockpiles
and ore on leach pads
|
403 | 290 | ||||||
Deferred
income tax assets
|
215 | 284 | ||||||
Other current
assets
|
900 | 455 | ||||||
Current
assets
|
5,822 | 2,301 | ||||||
Property,
plant and mine development, net
|
12,370 | 10,128 | ||||||
Investments
|
1,186 | 655 | ||||||
Stockpiles
and ore on leach pads
|
1,502 | 1,136 | ||||||
Deferred
income tax assets
|
937 | 1,039 | ||||||
Other
long-term assets
|
482 | 395 | ||||||
Assets of
operations held for sale
|
- | 73 | ||||||
Total
assets
|
$ | 22,299 | $ | 15,727 | ||||
LIABILITIES
|
||||||||
Current
portion of debt
|
$ | 157 | $ | 165 | ||||
Accounts
payable
|
396 | 411 | ||||||
Employee-related
benefits
|
250 | 170 | ||||||
Income and
mining taxes
|
200 | 61 | ||||||
Other current
liabilities
|
1,317 | 770 | ||||||
Current
liabilities
|
2,320 | 1,577 | ||||||
Debt
|
4,652 | 3,072 | ||||||
Reclamation
and remediation liabilities
|
805 | 699 | ||||||
Deferred
income tax liabilities
|
1,341 | 1,051 | ||||||
Employee-related
benefits
|
381 | 379 | ||||||
Other
long-term liabilities
|
174 | 252 | ||||||
Liabilities
of operations held for sale
|
13 | 36 | ||||||
Total
liabilities
|
9,686 | 7,066 | ||||||
EQUITY
|
||||||||
Common
stock
|
770 | 709 | ||||||
Additional
paid-in capital
|
8,158 | 6,831 | ||||||
Accumulated
other comprehensive income (loss)
|
626 | (253 | ) | |||||
Retained
earnings
|
1,149 | 4 | ||||||
Newmont
stockholders' equity
|
10,703 | 7,291 | ||||||
Noncontrolling
interests
|
1,910 | 1,370 | ||||||
Total
equity
|
12,613 | 8,661 | ||||||
Total
liabilities and equity
|
$ | 22,299 | $ | 15,727 |
The
Company’s financial statements can be found on its website at www.newmont.com.
Page 8 of 14 |
Statements of
Consolidated Cash Flows
Three Months Ended December 31,
|
Twelve Months Ended December 31,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
(unaudited, in millions)
|
(audited, in millions)
|
|||||||||||||||
Operating
activities:
|
||||||||||||||||
Net
income
|
$ | 865 | $ | 42 | $ | 2,093 | $ | 1,160 | ||||||||
Adjustments:
|
||||||||||||||||
Amortization
|
240 | 190 | 806 | 738 | ||||||||||||
Stock based
compensation and other benefits
|
13 | 12 | 57 | 50 | ||||||||||||
Accretion of
accumulated reclamation obligations
|
12 | 11 | 46 | 41 | ||||||||||||
Revaluation of
contingent consideration
|
23 | - | 23 | - | ||||||||||||
Loss (income)
from discontinued operations
|
2 | 4 | 16 | (13 | ) | |||||||||||
Reclamation
estimate revisions
|
13 | 27 | 13 | 101 | ||||||||||||
Write-down of
property, plant and mine development
|
4 | 134 | 7 | 137 | ||||||||||||
Impairment of
marketable securities
|
- | 24 | 6 | 114 | ||||||||||||
Deferred
income taxes
|
(6 | ) | (93 | ) | 1 | (315 | ) | |||||||||
Gain on asset
sales, net
|
(21 | ) | (2 | ) | (24 | ) | (72 | ) | ||||||||
Other
operating adjustments and write-downs
|
23 | 13 | 97 | 83 | ||||||||||||
Net change in
operating assets and liabilities
|
(200 | ) | (133 | ) | (227 | ) | (627 | ) | ||||||||
Net cash
provided from continuing operations
|
968 | 229 | 2,914 | 1,397 | ||||||||||||
Net cash
provided from (used in) discontinued operations
|
30 | 1 | 33 | (104 | ) | |||||||||||
Net cash
provided from operations
|
998 | 230 | 2,947 | 1,293 | ||||||||||||
Investing
activities:
|
||||||||||||||||
Additions to
property, plant and mine development
|
(455 | ) | (520 | ) | (1,769 | ) | (1,870 | ) | ||||||||
Acquisitions,
net
|
(241 | ) | - | (1,007 | ) | (325 | ) | |||||||||
Sales of
marketable securities
|
7 | - | 17 | 50 | ||||||||||||
Purchases of
marketable securities
|
(5 | ) | 1 | (5 | ) | (17 | ) | |||||||||
Other
|
1 | (10 | ) | (17 | ) | 16 | ||||||||||
Net cash used
in investing activities of continuing operations
|
(693 | ) | (529 | ) | (2,781 | ) | (2,146 | ) | ||||||||
Net cash used
in investing activities of discontinued operations
|
- | - | - | (11 | ) | |||||||||||
Net cash used
in investing activities
|
(693 | ) | (529 | ) | (2,781 | ) | (2,157 | ) | ||||||||
Financing
activities:
|
||||||||||||||||
Proceeds from
debt, net
|
(3 | ) | 2,277 | 4,299 | 5,078 | |||||||||||
Repayment of
debt
|
(127 | ) | (2,234 | ) | (2,731 | ) | (4,483 | ) | ||||||||
Proceeds from
stock issuance, net
|
30 | 2 | 1,278 | 29 | ||||||||||||
Sale of
subsidiary shares to noncontrolling interests
|
638 | - | 638 | - | ||||||||||||
Acquisition of
subsidiary shares from noncontrolling interests
|
(287 | ) | - | (287 | ) | - | ||||||||||
Dividends paid
to noncontrolling interests
|
(279 | ) | (142 | ) | (394 | ) | (389 | ) | ||||||||
Dividends paid
to common stockholders
|
(49 | ) | (46 | ) | (196 | ) | (182 | ) | ||||||||
Change in
restricted cash and other
|
(40 | ) | 55 | (35 | ) | 74 | ||||||||||
Net cash
provided from (used in) financing activities of continuing
operations
|
(117 | ) | (88 | ) | 2,572 | 127 | ||||||||||
Net cash used
in financing activities of discontinued operations
|
- | (1 | ) | (2 | ) | (4 | ) | |||||||||
Net cash
provided from (used in) financing activities
|
(117 | ) | (89 | ) | 2,570 | 123 | ||||||||||
Effect of
exchange rate changes on cash
|
5 | (30 | ) | 44 | (54 | ) | ||||||||||
Net change in
cash and cash equivalents
|
193 | (418 | ) | 2,780 | (795 | ) | ||||||||||
Cash and cash
equivalents at beginning of period
|
3,022 | 853 | 435 | 1,230 | ||||||||||||
Cash and cash
equivalents at end of period
|
$ | 3,215 | $ | 435 | $ | 3,215 | $ | 435 |
The
Company’s financial statements can be found on its website at www.newmont.com.
Page 9 of 14 |
Sales Statistics
Three Months Ended December 31,
|
Twelve Months Ended December 31,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Gold
|
||||||||||||||||
Consolidated
ounces sold (thousands):
|
||||||||||||||||
North
America
|
||||||||||||||||
Nevada (1)
|
567 | 601 | 2,005 | 2,225 | ||||||||||||
La
Herradura
|
34 | 24 | 113 | 95 | ||||||||||||
601 | 625 | 2,118 | 2,320 | |||||||||||||
South
America
|
||||||||||||||||
Yanacocha
|
510 | 433 | 2,068 | 1,843 | ||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington (2)
|
103 | - | 103 | - | ||||||||||||
Jundee
|
108 | 72 | 413 | 377 | ||||||||||||
Tanami
|
53 | 89 | 291 | 365 | ||||||||||||
Kalgoorlie
|
97 | 92 | 336 | 304 | ||||||||||||
Waihi
|
34 | 35 | 118 | 141 | ||||||||||||
Batu
Hijau
|
169 | 114 | 550 | 299 | ||||||||||||
564 | 402 | 1,811 | 1,486 | |||||||||||||
Africa
|
||||||||||||||||
Ahafo (3)
|
134 | 141 | 546 | 521 | ||||||||||||
1,809 | 1,601 | 6,543 | 6,170 | |||||||||||||
Copper
|
||||||||||||||||
Consolidated
pounds sold (millions):
|
||||||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington
|
9 | - | 9 | - | ||||||||||||
Batu
Hijau
|
156 | 89 | 498 | 290 | ||||||||||||
165 | 89 | 507 | 290 | |||||||||||||
Gold
|
||||||||||||||||
Equity
ounces sold (thousands):
|
||||||||||||||||
North
America
|
||||||||||||||||
Nevada (1)
|
567 | 601 | 2,005 | 2,225 | ||||||||||||
La
Herradura
|
34 | 24 | 113 | 95 | ||||||||||||
601 | 625 | 2,118 | 2,320 | |||||||||||||
South
America
|
||||||||||||||||
Yanacocha
|
262 | 222 | 1,062 | 946 | ||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington (2)
|
103 | - | 103 | - | ||||||||||||
Jundee
|
108 | 72 | 413 | 377 | ||||||||||||
Tanami
|
53 | 89 | 291 | 365 | ||||||||||||
Kalgoorlie
|
97 | 92 | 336 | 304 | ||||||||||||
Waihi
|
34 | 35 | 118 | 141 | ||||||||||||
Batu
Hijau
|
68 | 52 | 239 | 135 | ||||||||||||
463 | 340 | 1,500 | 1,322 | |||||||||||||
Africa
|
||||||||||||||||
Ahafo (3)
|
134 | 141 | 546 | 521 | ||||||||||||
1,460 | 1,328 | 5,226 | 5,109 | |||||||||||||
Discontinued
Operations
|
||||||||||||||||
Kori
Kollo
|
- | 18 | 33 | 75 | ||||||||||||
1,460 | 1,346 | 5,259 | 5,184 | |||||||||||||
Copper
|
||||||||||||||||
Equity
pounds sold (millions):
|
||||||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington
|
9 | - | 9 | - | ||||||||||||
Batu
Hijau
|
63 | 40 | 217 | 130 | ||||||||||||
72 | 40 | 226 | 130 |
(1)
|
Includes incremental start-up
ounces of 1 for the twelve months ended December 31, 2009 and December 31,
2008.
|
(2)
|
Includes incremental start-up
ounces of 8 for the three months and twelve months ended December 31,
2009.
|
(3)
|
Includes incremental start-up
ounces of 18 for the twelve months ended December 31, 2008
.
|
This information and
other detailed regional production statistics can be found in the Regional
Operating Statistics section of the Company’s website at www.newmont.com.
Page 10 of 14 |
CAS and Capital
Expenditures Statistics
Three Months Ended December 31,
|
Twelve Months Ended December 31,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Gold
|
||||||||||||||||
Costs Applicable to Sales ($/ounce) (1)
|
||||||||||||||||
North
America
|
||||||||||||||||
Nevada
|
$ | 495 | $ | 497 | $ | 521 | $ | 460 | ||||||||
La
Herradura
|
351 | 414 | 372 | 397 | ||||||||||||
487 | 494 | 513 | 457 | |||||||||||||
South
America
|
||||||||||||||||
Yanacocha
|
303 | 344 | 311 | 346 | ||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington
|
468 | - | 468 | - | ||||||||||||
Jundee
|
306 | 323 | 331 | 395 | ||||||||||||
Tanami
|
816 | 655 | 650 | 604 | ||||||||||||
Kalgoorlie
|
609 | 654 | 624 | 760 | ||||||||||||
Waihi
|
540 | 275 | 481 | 390 | ||||||||||||
Batu
Hijau
|
175 | 418 | 214 | 414 | ||||||||||||
410 | 496 | 418 | 524 | |||||||||||||
Africa
|
||||||||||||||||
Ahafo
|
506 | 385 | 444 | 408 | ||||||||||||
Average
|
$ | 413 | $ | 444 | $ | 417 | $ | 436 | ||||||||
Copper
|
||||||||||||||||
Costs Applicable to Sales ($/pound) (1)
|
||||||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington
|
$ | 1.77 | $ | - | $ | 1.77 | $ | - | ||||||||
Batu
Hijau
|
0.58 | 0.65 | 0.62 | 1.38 | ||||||||||||
Average
|
$ | 0.64 | $ | 0.65 | $ | 0.64 | $ | 1.38 |
Three Months Ended December 31,
|
Twelve Months Ended December 31,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Consolidated
Capital Expenditures ($ million)
|
||||||||||||||||
North
America
|
||||||||||||||||
Nevada
|
$ | 51 | $ | 72 | $ | 205 | $ | 299 | ||||||||
Hope
Bay
|
1 | 19 | 5 | 82 | ||||||||||||
La
Herradura
|
20 | 10 | 54 | 27 | ||||||||||||
72 | 101 | 264 | 408 | |||||||||||||
South
America
|
||||||||||||||||
Yanacocha
|
52 | 110 | 146 | 236 | ||||||||||||
Asia
Pacific
|
||||||||||||||||
Boddington
|
132 | 211 | 1,093 | 815 | ||||||||||||
Jundee
|
8 | 7 | 29 | 36 | ||||||||||||
Tanami
|
32 | 18 | 74 | 52 | ||||||||||||
Kalgoorlie
|
5 | 4 | 11 | 14 | ||||||||||||
Waihi
|
2 | 4 | 8 | 28 | ||||||||||||
Batu
Hijau
|
14 | 18 | 44 | 83 | ||||||||||||
Other Asia
Pacific
|
1 | 1 | 3 | 2 | ||||||||||||
194 | 263 | 1,262 | 1,030 | |||||||||||||
Africa
|
||||||||||||||||
Ahafo
|
33 | 33 | 75 | 109 | ||||||||||||
Akyem
|
6 | 1 | 10 | 2 | ||||||||||||
39 | 34 | 85 | 111 | |||||||||||||
Corporate and
Other
|
4 | 14 | 16 | 20 | ||||||||||||
Total
- Accrual Basis
|
361 | 522 | 1,773 | 1,805 | ||||||||||||
Change
in Capital Accrual
|
94 | (2 | ) | (4 | ) | 65 | ||||||||||
Total
- Cash Basis
|
$ | 455 | $ | 520 | $ | 1,769 | $ | 1,870 |
(1)
|
Excludes
Amortization and Accretion.
|
This
information and other detailed regional production statistics can be found in
the Regional Operating Statistics section of the Company’s website at www.newmont.com.
Page 11 of 14 |
Supplemental
Information:
Non-GAAP
Financial Measures
Non-GAAP financial
measures are intended to provide additional information only and do not have any
standard meaning prescribed by generally accepted accounting principles
(“GAAP”). These measures should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
GAAP.
Reconciliation
of Adjusted Net Income to GAAP Net
Income
Management of the
Company uses the non-GAAP financial measure Adjusted net income to evaluate the
Company’s operating performance, and for planning and forecasting future
business operations. The Company believes the use of Adjusted net
income allows investors and analysts to compare the results of the continuing
operations of the Company and its direct and indirect subsidiaries relating to
the production and sale of minerals to similar operating results of other mining
companies, by excluding exceptional or unusual items, income or loss from
discontinued operations and the permanent impairment of assets, including
marketable securities and goodwill. Management’s determination of the
components of Adjusted net income are evaluated periodically and based, in part,
on a review of non-GAAP financial measures used by mining industry
analysts.
The table below
sets forth a reconciliation of adjusted net income to GAAP Net income, the
directly comparable GAAP financial measure.
($
million except per share, after-tax)
|
Q4 2009 | Q4 2008 |
2009
|
2008
|
||||||||||||
GAAP
Net income (1)
|
$ | 558 | $ | 4 | $ | 1,297 | $ | 831 | ||||||||
Boddington
acquisition costs
|
- | - | 44 | - | ||||||||||||
Boddington
contingent consideration
|
15 | - | 15 | - | ||||||||||||
Impairment of
assets
|
- | 111 | 8 | 182 | ||||||||||||
Net gain on
asset sales
|
(14 | ) | (2 | ) | (16 | ) | (47 | ) | ||||||||
Income tax
estimate revisions
|
- | - | - | (159 | ) | |||||||||||
(Income) loss
from discontinued operations (1)
|
2 | 4 | 11 | (15 | ) | |||||||||||
Adjusted
net income
|
$ | 561 | $ | 117 | $ | 1,359 | $ | 792 | ||||||||
Adjusted
net income per share
|
$ | 1.14 | $ | 0.26 | $ | 2.79 | $ | 1.74 |
(1)
Attributable to Newmont stockholders.
Page 12 of 14 |
Reconciliation of Boddington Co-Product Costs Applicable to Sales to By-Product Costs Applicable to Sales
Revenue and Costs
applicable to sales for Boddington are presented in the Consolidated Financial
Statements for both gold and copper due to the significant portion of copper
production (approximately 15-20% of total revenue based on the latest
life-of-mine plan and metal price assumptions). The co-product method allocates
costs applicable to sales to each metal based on specifically identifiable costs
where applicable and on a relative proportion of revenue values for other costs.
Management also assesses the performance of the Boddington mine on a by-product
basis due to the majority of revenues being derived from gold and to determine
contingent consideration payments that may be paid to AngloGold to acquire the
remaining 33.33% interest in Boddington. The by-product method deducts copper
revenue from costs applicable to sales as shown in the following
table.
Boddington
|
By-Product
|
|||||||||||||||
method
|
Co-Product
method
|
|||||||||||||||
Q4
2009
|
Gold
|
Gold
|
Copper
|
Total
|
||||||||||||
($million
except per ounce/pound)
|
||||||||||||||||
Revenue,
net
|
$ | 101 | $ | 101 | $ | 27 | $ | 128 | ||||||||
Production
costs:
|
||||||||||||||||
Direct mining
and production costs
|
58 | 46 | 12 | 58 | ||||||||||||
By-product
credits
|
(28 | ) | (1 | ) | - | (1 | ) | |||||||||
Royalties and
production taxes
|
5 | 4 | 1 | 5 | ||||||||||||
Other
|
(2 | ) | (5 | ) | 3 | (2 | ) | |||||||||
Costs
applicable to sales
|
33 | 44 | 16 | 60 | ||||||||||||
Amortization
and accretion
|
20 | 16 | 4 | 20 | ||||||||||||
Total
production costs
|
53 | 60 | 20 | 80 | ||||||||||||
Gross
margin
|
48 | 41 | 7 | 48 | ||||||||||||
Gold ounces
sold (000)(1)
|
95 | 95 | ||||||||||||||
Costs
applicable to sales per ounce
|
$ | 352 | $ | 468 | ||||||||||||
Copper pounds
sold (millions)
|
N/A | 9 | ||||||||||||||
Costs
applicable to sales per pound
|
N/A | $ | 1.77 |
(1)
Excludes incremental start-up sales of 8 ounces.
To
view more detailed financial disclosure, including regional mine statistics,
Results of Consolidated Operations, Liquidity and Capital Resources,
Management’s Discussion & Analysis, relevant Risk Factors, and a complete
outline of the 2009 Operating and Financial guidance by region, please see the
Company’s Annual Report on Form 10-K, filed with the Securities and Exchange
Commission on February 25, 2010, available at www.newmont.com.
The Company’s
fourth quarter and year-end earnings conference call and web cast presentation
will be held on Thursday, February 25, 2010 beginning at 10:00 a.m. Eastern Time
(8:00 a.m. Mountain Time). To participate:
Dial-In
Number
|
800.779.3178
|
Intl
Dial-In Number
|
415.228.4957
|
Leader
|
John
Seaberg
|
Passcode
|
Newmont
|
Replay
Number
|
866.451.8896
|
Intl
Replay Number
|
203.369.1202
|
Replay
Passcode
|
2010
|
Page 13 of 14 |
The conference call also will be simultaneously carried on our web site at www.newmont.com under Investor Relations/Presentations and will be archived there for a limited time.
Investor
Contacts
|
||
John
Seaberg
|
303.837.5743
|
john.seaberg@newmont.com
|
Media
Contacts
|
||
Omar
Jabara
|
303.837.5114
|
omar.jabara@newmont.com
|
Cautionary
Statement:
This news release
contains “forward-looking statements” within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended which are intended to be covered by the safe harbor
created by such sections and other applicable laws. Such forward-looking
statements include, without limitation: (i) estimates of future mineral
production and sales; (ii) estimates of future costs applicable to sales, other
expenses and taxes, for specific operations and on a consolidated basis; (iii)
estimates of future capital expenditures, construction, production or closure
activities; (iv) statements regarding future exploration expenditures, results
and reserves; (v) statements regarding fluctuations in capital and currency
markets; (vi) statements regarding potential cost savings, productivity,
operating performance, and cost structure; (vii) expectations regarding the
ramp-up, mine life, production and costs applicable to sales and exploration
potential of Boddington and the Company’s other projects; and (viii)
expectations regarding the impacts of operating, technical or geotechnical
issues in connection with the Company’s projects or operations. Estimates
or expectations of future events or results are based upon certain assumptions,
which may prove to be incorrect. Such assumptions, include, but are not
limited to: (i) there being no significant change to current geotechnical,
metallurgical, hydrological and other physical conditions; (ii) permitting,
development, operations and expansion of the Company’s projects being consistent
with current expectations and mine plans; (iii) political developments in any
jurisdiction in which the Company operates being consistent with its current
expectations; (iv) certain exchange rate assumptions for the Australian dollar
to the U.S. dollar, as well as other the exchange rates being approximately
consistent with current levels; (v) certain price assumptions for gold, copper
and oil; (vi) prices for key supplies being approximately consistent with
current levels; and (vii) the accuracy of our current mineral reserve and
mineral resource estimates. Where the Company expresses or implies an
expectation or belief as to future events or results, such expectation or belief
is expressed in good faith and believed to have a reasonable basis.
However, forward-looking statements are subject to risks, uncertainties and
other factors, which could cause actual results to differ materially from future
results expressed, projected or implied by such forward-looking
statements. Such risks include, but are not limited to, gold and other
metals price volatility, currency fluctuations, increased production costs and
variances in ore grade or recovery rates from those assumed in mining plans,
political and operational risks in the countries in which we operate, and
governmental regulation and judicial outcomes. For a more detailed
discussion of such risks and other factors, see the Company’s 2009 Annual Report
on Form 10-K, filed on February 25, 2010, with the Securities and Exchange
Commission, as well as the Company’s other SEC filings. The Company does
not undertake any obligation to release publicly revisions to any
“forward-looking statement,” to reflect events or circumstances after the date
of this news release, or to reflect the occurrence of unanticipated events,
except as may be required under applicable securities laws.
Page 14 of 14 |