Newcrest Min­ing ( NCM)

Townsville Bulletin - - NEWS - Diana Lock, Mor­gans Fi­nan­cial

OVER­ALL, a solid quar­ter main­tain­ing the mo­men­tum of the March quar­ter. Cop­per came in at the top end of ex­pec­ta­tions and ful­lyear pro­duc­tion was in the mid­dle- top end of fore­casts. Over­all it was a rea­son­able quar­ter show­ing NCM’s pro­grams of cost con­trol and ef­fi­ciency are hav­ing a sus­tained ef­fect. Solid re­sult in our view and should be well re­ceived in light of the re­cent share price weak­ness.

Ex­plo­ration seems to be in­creas­ing with a few projects show­ing de­tailed ex­plo­ration at Gosowong, the Mun­gana JV and NZ projects.

Pro­duc­tion came in at 2.42Moz which is in the mid­dle of NCM’s forecast guid­ance range, all in sus­tain­ing costs were slightly higher at A$ 978/ oz ( ver­sus A$ 946 in the March quar­ter) and full- year costs av­er­aged $ 941/ oz.

Telfer lagged on pro­duc­tion with 116koz ( vs. 129koz in the pcp). Li­hir, their prob­lem­atic op­er­a­tion per­formed well as im­proved pro­cess­ing cir­cuit per­for­mance paid off with higher gold pro­duc­tion. Li­hir achieved a 9 per cent im­prove­ment to 195koz ( vs. 178koz in the pcp). Cadiz pro­duc­tion was up.

Their all- in sus­tain­ing costs of A$ 247/ oz were lower than the pre­vi­ous quar­ter as economies of scale im­proved. Gosowong had a whop­ping 62 per cent higher pro­duc­tion up to 122Koz ( from 75koz) on higher grades and show­ing what a gem the pro­ject is when it in­ter­cepts high grade pods with all- in costs of A$ 709/ oz – im­pres­sive. Bonikro pro­duc­tion re­mained at the higher March quar­ter lev­els – a solid re­sult at 36koz at A$ 839/ oz.

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