EX-99.1 2 a52463960ex991.htm EXHIBIT 99.1
Exhibit 99.1

Newmont Announces Solid Second Quarter Results

Newmont Delivers Solid Second Quarter Results; Clear Strategy to Deliver Value From Our World-Class Portfolio of Long-Life, Responsibly Managed Assets

DENVER--(BUSINESS WIRE)--July 22, 2021--Newmont Corporation (NYSE: NEM, TSX: NGT) (Newmont or the Company) today announced second quarter 2021 results.

SECOND QUARTER 2021 HIGHLIGHTS

  • Produced 1.4 million attributable ounces of gold and 303 thousand attributable gold equivalent ounces from co-products
  • Reported gold CAS* of $755 per ounce and AISC* of $1,035 per ounce
  • Full-year results continue to be back-half weighted, in line with guidance ranges**
  • Generated $993 million of cash from continuing operations and $578 million of Free Cash Flow (97 percent attributable to Newmont)*
  • Declared second quarter dividend of $0.55 per share, consistent with the previous quarter***
  • Completed $149 million of share repurchases from $1 billion buyback program***
  • Ended the quarter with $4.6 billion of consolidated cash and $7.6 billion of liquidity with a net debt to adjusted EBITDA* ratio of 0.2x
  • Reduced $550 million of debt outstanding with available cash in April 2021
  • Completed acquisition of GT Gold in May 2021, increasing our interest in the prospective Golden Triangle
  • Approved full funding for Ahafo North in July 2021, meeting Newmont’s internal hurdle rate at the base assumption of $1,200 per ounce gold price; expecting to deliver an internal rate of return of over 30 percent at current prices
  • Published 2020 Annual Sustainability Report, a transparent review of our Environmental, Social and Governance performance
  • Launched first Climate Strategy Report, including pathways to achieve our climate targets

"Throughout our history Newmont has taken an industry-leading approach to environmental, social and governance practices. We published our sustainability and climate-focused reports in the second quarter, demonstrating our commitment to responsible mining and doing our part in addressing climate change," said Tom Palmer, President and Chief Executive Officer. "Capitalizing on the strength of our assets and integrated operating model, Newmont delivered a solid second quarter performance with $1.6 billion in adjusted EBITDA and $578 million in free cash flow. Our performance and disciplined approach to capital allocation allowed Newmont to declare a second quarter dividend of $0.55 per share, whilst we continue to reinvest in our business through our most profitable projects. As we move into our next 100 years of mining, we remain focused on delivering value to all of our stakeholders from our world-class portfolio of long-life, responsibly managed assets located in top-tier jurisdictions."

- Tom Palmer, President and Chief Executive Officer

________________________________________________

*

Non-GAAP metrics; see footnotes at the end of this release.

**

See discussion of outlook and cautionary statement at end of release regarding forward-looking statements.

***

See cautionary statement and endnotes at the end of this release, including with respect to future dividends and share buybacks. Note that the buyback figure above includes $15 million settled after June 30, 2021.


SECOND QUARTER 2021 FINANCIAL AND PRODUCTION SUMMARY

 

Q2'21

Q1'21

Q2'20

Attributable gold production (million ounces)

1.45

1.46

1.26

Gold costs applicable to sales (CAS) ($ per ounce)

$

755

$

752

$

748

Gold all-in sustaining costs (AISC) ($ per ounce)

$

1,035

$

1,039

$

1,097

GAAP Net income (US $ millions)

$

640

$

538

$

412

Adjusted net income (US $ millions)

$

670

$

594

$

261

Adjusted EBITDA (US $ millions)

$

1,591

$

1,457

$

984

Cash flow from continuing operations (US $ millions)

$

993

$

841

$

668

Capital Expenditures (US $ millions)

$

415

$

399

$

280

Free cash flow (US $ millions)

$

578

$

442

$

388

Attributable gold production1 increased 15 percent to 1,449 thousand ounces from the prior year quarter primarily due to higher production from sites that were placed into care and maintenance or experienced reduced operations in response to Covid during 2020, and higher ore grade milled and higher mill throughput at Boddington. These increases were partially offset by lower mill availability and lower tons and grades mined at Nevada Gold Mines, the ramp down of the mill at Yanacocha during the first quarter of 2021 and a build-up of in-circuit inventory at Tanami as the mine was placed under care and maintenance in late-June as a result of Covid restrictions.

Gold CAS increased 16 percent to $1,091 million from the prior year quarter primarily due to higher gold ounces sold. Gold CAS per ounce2 remained flat compared to the prior year quarter at $755 per ounce as higher maintenance costs and unfavorable Australian dollar foreign currency exchange rate were largely offset by higher ounces sold and higher by-product credits.

Gold AISC3 improved 6 percent to $1,035 per ounce from the prior year quarter primarily due to care and maintenance costs in the prior year, partially offset by higher sustaining capital spend.

Attributable gold equivalent ounce (GEO) production from other metals increased 120 percent to 303 thousand ounces primarily due to higher production at Peñasquito as the site was placed into care and maintenance in the prior year and higher ore grade milled, mill throughput and recoveries at Boddington.

CAS from other metals totaled $190 million for the quarter. CAS per GEO2 increased 13 percent to $629 per ounce from the prior year quarter primarily due to higher maintenance costs at Peñasquito, unfavorable foreign currency impacts from the strengthening of the Australian dollar, higher allocation of costs to other metals and higher copper-price driven royalties, partially offset by higher other metal sales. AISC per GEO3 improved 9 percent to $886 per ounce primarily due to lower treatment and refining costs and higher care and maintenance costs in the prior year, partially offset by higher CAS per GEO.

Net income from continuing operations attributable to Newmont stockholders was $640 million or $0.80 per diluted share, an increase of $228 million from the prior year quarter primarily due to higher sales volumes and higher average realized prices in the current year. These increases were partially offset by higher income tax expense in the current year.

Adjusted net income4 was $670 million or $0.83 per diluted share, compared to $261 million or $0.32 per diluted share in the prior year quarter. Primary adjustments to second quarter net income include changes in the fair value of investments, reclamation and remediation charges, asset impairment and valuation allowance and other tax adjustments.

Adjusted EBITDA5 improved 62 percent to $1,591 million for the quarter, compared to $984 million for the prior year quarter.


Revenue increased 30 percent from the prior year quarter to $3,065 million primarily due to higher average realized metal prices and higher sales volumes.

Average realized price6 for gold was $1,823, an increase of $99 per ounce over the prior year quarter. Average realized gold price includes $1,819 per ounce of gross price received, the favorable impact of $9 per ounce mark-to-market on provisionally-priced sales and reductions of $5 per ounce for treatment and refining charges.

Capital expenditures7 increased 48 percent from the prior year quarter to $415 million primarily due to higher sustaining capital spend from sites that were placed into care and maintenance in response to Covid during 2020 and higher development capital spend. Development capital expenditures in 2021 primarily include advancing Tanami Expansion 2, Yanacocha Sulfides, Ahafo North, the Subika Mining Method Change, Cerro Negro expansion projects, Quecher Main and projects associated with the Company’s ownership interest in Nevada Gold Mines.

Consolidated operating cash flow from continuing operations increased 49 percent from the prior year quarter to $993 million primarily due to higher average realized metal prices, partially offset by an increase in tax payments and an increase in receivables related to timing. Free Cash Flow8 also increased to $578 million primarily due to higher operating cash flow, partially offset by higher capital expenditures as described above.

Balance sheet and liquidity ended the quarter with $4.6 billion of consolidated cash and approximately $7.6 billion of liquidity; reported net debt to adjusted EBITDA of 0.2x9.

Nevada Gold Mines (NGM) attributable gold production was 284 thousand ounces with CAS of $753 per ounce and AISC of $985 per ounce for the second quarter. EBITDA10 for NGM was $298 million.

Pueblo Viejo (PV) attributable gold production was 78 thousand ounces for the quarter. Pueblo Viejo EBITDA10 was $111 million and cash distributions received for the Company's equity method investment totaled $23 million in the second quarter.

COVID-19 UPDATE

Newmont continues to maintain wide-ranging protective measures for its workforce and neighboring communities, including screening, physical distancing, deep cleaning and avoiding exposure for at-risk individuals. The Company incurred incremental Covid specific costs of $20 million during the quarter for activities such as additional health and safety procedures, increased transportation and community fund contributions. During the second quarter of 2020, the Newmont Global Community Support Fund was established to help host communities, governments and employees combat the Covid pandemic. Amounts distributed from this fund were $1 million during the quarter and have been adjusted from certain non-GAAP metrics. The remaining $19 million is not adjusted from our non-GAAP metrics.

We have mobilized a Covid vaccine working group with representatives from across the globe. Newmont views vaccination as critical in the fight against Covid-19 and actively encourages our workforce to get vaccinated as they become eligible. We are working to support authorities, through our Global Community Support Fund, to improve the availability and deployment of vaccines to our workforce and host communities.

PROJECTS UPDATE

Newmont’s capital-efficient project pipeline supports improving production, lowering costs and extending mine life. Funding for the current development capital projects Tanami Expansion 2 and Ahafo North has been approved and these projects are in the execution stage. The Company has included the Yanacocha Sulfides project in its long-term outlook as the project is currently scheduled to be approved for full funding in December 2021. Additional sustaining and development projects, not listed below, represent incremental improvements to the Company's outlook.


  • Tanami Expansion 2 (Australia) secures Tanami’s future as a long-life, low-cost producer with potential to extend mine life beyond 2040 through the addition of a 1,460 meter hoisting shaft and supporting infrastructure to achieve 3.5 million tonnes per year of production and provide a platform for future growth. The expansion is expected to increase average annual gold production by approximately 150,000 to 200,000 ounces per year for the first five years and is expected to reduce operating costs by approximately 10 percent. Capital costs for the project are estimated to be between $850 million and $950 million with a commercial production date in the first half of 2024.
  • Ahafo North (Africa) expands our existing footprint in Ghana with four open pit mines and a stand-alone mill located approximately 30 kilometers from the Company’s Ahafo South operations. The project is expected to add between 275,000 and 325,000 ounces per year with all-in sustaining costs between $600 to $700 per ounce for the first five full years of production (2024-2028). Capital costs for the project are estimated to be between $750 and $850 million with a construction completion date in the second half of 2023 and commercial production in early-2024. Ahafo North is the best unmined gold deposit in West Africa with approximately 3.5 million ounces of Reserves and more than 1 million ounces of Measured and Indicated and Inferred Resource11 and significant upside potential to extend beyond Ahafo North’s current 13-year mine life.
  • Yanacocha Sulfides (South America)12 will develop the first phase of sulfide deposits and an integrated processing circuit, including an autoclave to process gold, copper and silver feedstock. The project is expected to add 500,000 gold equivalent ounces per year with all-in sustaining costs between $700 to $800 per ounce for the first five full years of production (2026-2030). An investment decision is expected in December 2021 with a three year development period and estimated capital costs of approximately $2 billion. The first phase focuses on developing the Yanacocha Verde and Chaquicocha deposits to extend Yanacocha’s operations beyond 2040 with second and third phases having the potential to extend life for multiple decades.

________________________________________________

1

Attributable gold production for the second quarter 2021 includes 78 thousand ounces from the Company’s equity method investment in Pueblo Viejo (40%).

2

Non-GAAP measure. See end of this release for reconciliation to Costs applicable to sales.

3

Non-GAAP measure. See end of this release for reconciliation to Costs applicable to sales.

4

Non-GAAP measure. See end of this release for reconciliation to Net income (loss) attributable to Newmont stockholders.

5

Non-GAAP measure. See end of this release for reconciliation to Net income (loss) attributable to Newmont stockholders.

6

Non-GAAP measure. See end of this release for reconciliation to Sales.

7

Capital expenditures refers to Additions to property plant and mine development from the Condensed Consolidated Statements of Cash Flows.

8

Non-GAAP measure. See end of this release for reconciliation to Net cash provided by operating activities.

9

Non-GAAP measure. See end of this release for reconciliation.

10

Non-GAAP measure. See end of this release for reconciliation.

11

See note to U.S. Investors at the end of this release; such resource estimate for Ahafo North is comprised of 610,000 ounces of Measured and Indicated Resource and 410,000 ounces of Inferred Resource as at December 31, 2020.

12

Consolidated basis.

OUTLOOK

Newmont’s outlook reflects increasing gold production and ongoing investment in its operating assets and most promising growth prospects. The Company has included Yanacocha Sulfides in its outlook as the development project is expected to reach execution stage in December 2021. Additional development projects that have not reached execution stage represent upside to guidance. All production, cost and capital figures assume a $1,200/oz gold price.

Newmont’s 2021 and longer-term outlook assumes operations continue without major Covid-related interruptions. If at any point the Company determines that continuing operations poses an increased risk to our workforce or host communities, it will reduce operational activities up to, and including, care and maintenance and management of critical environmental systems. Please see cautionary statement in the end notes for additional information.


Please see cautionary statement in the end notes for additional information. Investors are reminded that outlook is a range of plus or minus 5 percent of the midpoints noted below. For further discussion, investors are encouraged to attend Newmont’s Second Quarter 2021 Earnings Conference Call.

Five Year Cost and Production Outlook (+/- 5%)

Guidance metric

2021E

2022E

2023E

2024E

2025E

Gold Production* (Moz)

6.5

6.2 - 6.7

6.2 - 6.7

6.5 - 7.0

6.5 - 7.0

Other Metal Production** (Mozs)

1.3

1.2 - 1.4

1.4 - 1.6

1.4 - 1.6

1.4 - 1.6

Total GEO Production (Mozs)

7.8

7.5 - 8.0

7.7 - 8.2

8.0 - 8.5

8.0 - 8.5

CAS*** ($/oz)

$750

$650 - $750

$625 - $725

$600 - $700

$600 - $700

All-in Sustaining Costs*** ($/oz)

$970

$850 - $950

$825 - $925

$800 - $900

$800 - $900

Sustaining Capital* ($M)

$950

$900 - $1,100

$900 - $1,100

$900 - $1,100

$900 - $1,100

Development Capital* ($M)

$850

$1,000 - $1,200

$900 - $1,100

$200 - $400

$100 - $300

Total Capital* ($M)

$1,800

$2,000 - $2,200

$1,900 - $2,100

$1,200 - $1,400

$1,100 - $1,300

*Attributable basis; **Attributable co-product gold equivalent ounces; includes copper, silver, lead and zinc; ***Consolidated basis for gold

2021 Consolidated Expense Outlook ($M) (+/-5%)

General & Administrative

260

Interest Expense

275

Depreciation and Amortization

2,500

Exploration & Advanced Projects

390

Adjusted Tax Rate a,b

34% - 38%

Federal Tax Rate b

27% - 30%

Mining Tax Rate b

6% - 9%

a

The adjusted tax rate excludes certain items such as tax valuation allowance adjustments.

b

Assuming average prices of $1,500 per ounce for gold, $22 per ounce for silver, $2.75 per pound for copper, $0.90 per pound for lead, and $1.05 per pound for zinc and achievement of current production and sales volumes and cost estimates, we estimate our consolidated adjusted effective tax rate related to continuing operations for 2021 will be between 34%-38%.



Three Months Ended June 30,

 

Six Months Ended June 30,

Operating Results

2021

2020

% Change

 

2021

2020

% Change

Attributable Sales (koz)

 

 

 

 

 

 

 

Attributable gold ounces sold (1)

1,383

 

1,198

 

15

 

%

 

2,744

 

2,567

 

7

 

%

Attributable gold equivalent ounces sold

302

 

213

 

42

 

%

 

629

 

532

 

18

 

%

 

 

 

 

 

 

 

 

Average Realized Price ($/oz, $/lb)

 

 

 

 

 

 

 

Average realized gold price

$

1,823

 

$

1,724

 

6

 

%

 

$

1,788

 

$

1,652

 

8

 

%

Average realized copper price

$

4.37

 

$

2.91

 

50

 

%

 

$

4.30

 

$

2.21

 

95

 

%

Average realized silver price

$

23.00

 

$

14.70

 

56

 

%

 

$

21.27

 

$

14.35

 

48

 

%

Average realized lead price

$

1.02

 

$

0.75

 

36

 

%

 

$

0.95

 

$

0.68

 

40

 

%

Average realized zinc price

$

1.34

 

$

0.70

 

91

 

%

 

$

1.19

 

$

0.65

 

83

 

%

 

 

 

 

 

 

 

 

Attributable Production (koz)

 

 

 

 

 

 

 

North America

397

 

232

 

71

 

%

 

810

 

608

 

33

 

%

South America

189

 

136

 

39

 

%

 

363

 

371

 

(2

)

%

Australia

299

 

294

 

2

 

%

 

568

 

552

 

3

 

%

Africa

202

 

193

 

5

 

%

 

407

 

379

 

7

 

%

Nevada

284

 

326

 

(13

)

%

 

587

 

655

 

(10

)

%

Total Gold (excluding equity method investments)

1,371

 

1,181

 

16

 

%

 

2,735

 

2,565

 

7

 

%

Pueblo Viejo (40%) (2)

78

 

74

 

5

 

%

 

169

 

169

 

 

%

Total Gold

1,449

 

1,255

 

15

 

%

 

2,904

 

2,734

 

6

 

%

 

 

 

 

 

 

 

 

North America

260

 

108

 

141

 

%

 

545

 

418

 

30

 

%

Australia

43

 

30

 

43

 

%

 

75

 

59

 

27

 

%

Total Gold Equivalent Ounces

303

 

138

 

120

 

%

 

620

 

477

 

30

 

%

 

 

 

 

 

 

 

 

CAS Consolidated ($/oz, $/GEO)

 

 

 

 

 

 

 

North America

$

769

 

$

735

 

5

 

%

 

$

752

 

$

811

 

(7

)

%

South America

$

721

 

$

781

 

(8

)

%

 

$

753

 

$

796

 

(5

)

%

Australia

$

764

 

$

719

 

6

 

%

 

$

757

 

$

724

 

5

 

%

Africa

$

763

 

$

696

 

10

 

%

 

$

760

 

$

715

 

6

 

%

Nevada

$

753

 

$

797

 

(6

)

%

 

$

749

 

$

765

 

(2

)

%

Total Gold

$

755

 

$

748

 

1

 

%

 

$

754

 

$

766

 

(2

)

%

Total Gold (by-product)

$

586

 

$

684

 

(14

)

%

 

$

595

 

$

711

 

(16

)

%

 

 

 

 

 

 

 

 

North America

$

586

 

$

505

 

16

 

%

 

$

550

 

$

551

 

 

%

Australia

$

898

 

$

874

 

3

 

%

 

$

913

 

$

843

 

8

 

%

Total Gold Equivalent Ounces

$

629

 

$

555

 

13

 

%

 

$

590

 

$

583

 

1

 

%

 

 

 

 

 

 

 

 

AISC Consolidated ($/oz, $/GEO)

 

 

 

 

 

 

 

North America

$

985

 

$

1,162

 

(15

)

%

 

$

971

 

$

1,105

 

(12

)

%

South America

$

1,022

 

$

1,233

 

(17

)

%

 

$

1,041

 

$

1,087

 

(4

)

%

Australia

$

997

 

$

907

 

10

 

%

 

$

1,048

 

$

927

 

13

 

%

Africa

$

1,000

 

$

877

 

14

 

%

 

$

974

 

$

902

 

8

 

%

Nevada

$

985

 

$

979

 

1

 

%

 

$

924

 

$

953

 

(3

)

%

Total Gold

$

1,035

 

$

1,097

 

(6

)

%

 

$

1,037

 

$

1,061

 

(2

)

%

Total Gold (by-product)

$

918

 

$

1,104

 

(17

)

%

 

$

935

 

$

1,070

 

(13

)

%

 

 

 

 

 

 

 

 

North America

$

761

 

$

960

 

(21

)

%

 

$

762

 

$

888

 

(14

)

%

Australia

$

1,113

 

$

1,068

 

4

 

%

 

$

1,231

 

$

1,051

 

17

 

%

Total Gold Equivalent Ounces

$

886

 

$

974

 

(9

)

%

 

$

851

 

$

906

 

(6

)

%

(1)

Attributable gold ounces from the Pueblo Viejo mine, an equity method investment, are not included in attributable gold ounces sold.

(2)

Represents attributable gold from Pueblo Viejo and does not include the Company's other equity method investments. Attributable gold ounces produced at Pueblo Viejo are not included in attributable gold ounces sold, as noted in footnote 1. Income and expenses of equity method investments are included in Equity income (loss) of affiliates.


NEWMONT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions except per share)




 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2021

 

2020

 

2021

 

2020

 

 

 

 

 

 

 

 

Sales

$

3,065

 

 

 

$

2,365

 

 

 

$

5,937

 

 

 

$

4,946

 

 

 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

Costs applicable to sales (1)

1,281

 

 

 

1,058

 

 

 

2,528

 

 

 

2,390

 

 

Depreciation and amortization

561

 

 

 

528

 

 

 

1,114

 

 

 

1,093

 

 

Reclamation and remediation

57

 

 

 

40

 

 

 

103

 

 

 

78

 

 

Exploration

52

 

 

 

26

 

 

 

87

 

 

 

70

 

 

Advanced projects, research and development

37

 

 

 

26

 

 

 

68

 

 

 

53

 

 

General and administrative

64

 

 

 

72

 

 

 

129

 

 

 

137

 

 

Care and maintenance

2

 

 

 

125

 

 

 

2

 

 

 

145

 

 

Other expense, net

50

 

 

 

59

 

 

 

89

 

 

 

92

 

 

 

2,104

 

 

 

1,934

 

 

 

4,120

 

 

 

4,058

 

 

Other income (expense):

 

 

 

 

 

 

 

Gain on asset and investment sales, net

 

 

 

(1

)

 

 

43

 

 

 

592

 

 

Other income, net

50

 

 

 

198

 

 

 

(32

)

 

 

9

 

 

Interest expense, net of capitalized interest

(68

)

 

 

(78

)

 

 

(142

)

 

 

(160

)

 

 

(18

)

 

 

119

 

 

 

(131

)

 

 

441

 

 

Income (loss) before income and mining tax and other items

943

 

 

 

550

 

 

 

1,686

 

 

 

1,329

 

 

Income and mining tax benefit (expense)

(341

)

 

 

(164

)

 

 

(576

)

 

 

(141

)

 

Equity income (loss) of affiliates

49

 

 

 

29

 

 

 

99

 

 

 

66

 

 

Net income (loss) from continuing operations

651

 

 

 

415

 

 

 

1,209

 

 

 

1,254

 

 

Net income (loss) from discontinued operations

10

 

 

 

(68

)

 

 

31

 

 

 

(83

)

 

Net income (loss)

661

 

 

 

347

 

 

 

1,240

 

 

 

1,171

 

 

Net loss (income) attributable to noncontrolling interests

(11

)

 

 

(3

)

 

 

(31

)

 

 

(5

)

 

Net income (loss) attributable to Newmont stockholders

$

650

 

 

 

$

344

 

 

 

$

1,209

 

 

 

$

1,166

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to Newmont stockholders:

 

 

 

 

 

 

 

Continuing operations

$

640

 

 

 

$

412

 

 

 

$

1,178

 

 

 

$

1,249

 

 

Discontinued operations

10

 

 

 

(68

)

 

 

31

 

 

 

(83

)

 

 

$

650

 

 

 

$

344

 

 

 

$

1,209

 

 

 

$

1,166

 

 

Net income (loss) attributable to Newmont stockholders per common share

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

Continuing operations

$

0.80

 

 

 

$

0.51

 

 

 

$

1.47

 

 

 

$

1.55

 

 

Discontinued operations

0.01

 

 

 

(0.08

)

 

 

0.04

 

 

 

(0.10

)

 

 

$

0.81

 

 

 

$

0.43

 

 

 

$

1.51

 

 

 

$

1.45

 

 

Diluted:

 

 

 

 

 

 

 

Continuing operations

$

0.80

 

 

 

$

0.51

 

 

 

$

1.47

 

 

 

$

1.55

 

 

Discontinued operations

0.01

 

 

 

(0.08

)

 

 

0.04

 

 

 

(0.10

)

 

 

$

0.81

 

 

 

$

0.43

 

 

 

$

1.51

 

 

 

$

1.45

 

 

(1)

Excludes Depreciation and amortization and Reclamation and remediation.


NEWMONT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)




 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2021

 

2020

 

2021

 

2020

Operating activities:

 

 

 

 

 

 

 

Net income (loss)

$

661

 

 

 

$

347

 

 

 

$

1,240

 

 

 

$

1,171

 

 

Adjustments:

 

 

 

 

 

 

 

Depreciation and amortization

561

 

 

 

528

 

 

 

1,114

 

 

 

1,093

 

 

Gain on asset and investment sales, net

 

 

 

1

 

 

 

(43

)

 

 

(592

)

 

Net loss (income) from discontinued operations

(10

)

 

 

68

 

 

 

(31

)

 

 

83

 

 

Reclamation and remediation

53

 

 

 

37

 

 

 

96

 

 

 

72

 

 

Change in fair value of investments

(26

)

 

 

(227

)

 

 

84

 

 

 

(134

)

 

Equity earnings in affiliates, net of distributions received

(55

)

 

 

3

 

 

 

(55

)

 

 

(34

)

 

Stock-based compensation

21

 

 

 

17

 

 

 

38

 

 

 

38

 

 

Deferred income taxes

39

 

 

 

(26

)

 

 

14

 

 

 

(144

)

 

Impairment of investments

 

 

 

 

 

 

 

 

 

93

 

 

Charges from debt extinguishment

 

 

 

3

 

 

 

 

 

 

77

 

 

Other non-cash adjustments

15

 

 

 

62

 

 

 

(32

)

 

 

2

 

 

Net change in operating assets and liabilities

(266

)

 

 

(145

)

 

 

(591

)

 

 

(118

)

 

Net cash provided by (used in) operating activities of continuing operations

993

 

 

 

668

 

 

 

1,834

 

 

 

1,607

 

 

Net cash provided by (used in) operating activities of discontinued operations

2

 

 

 

(4

)

 

 

2

 

 

 

(7

)

 

Net cash provided by (used in) operating activities

995

 

 

 

664

 

 

 

1,836

 

 

 

1,600

 

 

 

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

Additions to property, plant and mine development

(415

)

 

 

(280

)

 

 

(814

)

 

 

(608

)

 

Acquisitions, net

(328

)

 

 

 

 

 

(328

)

 

 

 

 

Proceeds from sales of investments

22

 

 

 

6

 

 

 

84

 

 

 

270

 

 

Contributions to equity method investees

(45

)

 

 

(8

)

 

 

(72

)

 

 

(14

)

 

Return of investment from equity method investees

 

 

 

 

 

 

18

 

 

 

43

 

 

Purchases of investments

(12

)

 

 

(21

)

 

 

(16

)

 

 

(33

)

 

Proceeds from sales of mining operations and other assets, net

 

 

 

14

 

 

 

1

 

 

 

1,135

 

 

Other

1

 

 

 

5

 

 

 

 

 

 

46

 

 

Net cash provided by (used in) investing activities

(777

)

 

 

(284

)

 

 

(1,127

)

 

 

839

 

 

 

 

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

Dividends paid to common stockholders

(440

)

 

 

(201

)

 

 

(881

)

 

 

(313

)

 

Repayment of debt

(550

)

 

 

(90

)

 

 

(550

)

 

 

(1,160

)

 

Repurchases of common stock

(134

)

 

 

 

 

 

(134

)

 

 

(321

)

 

Distributions to noncontrolling interests

(43

)

 

 

(42

)

 

 

(97

)

 

 

(88

)

 

Funding from noncontrolling interests

18

 

 

 

27

 

 

 

48

 

 

 

55

 

 

Payments on lease and other financing obligations

(18

)

 

 

(17

)

 

 

(36

)

 

 

(33

)

 

Payments for withholding of employee taxes related to stock-based compensation

(1

)

 

 

(3

)

 

 

(29

)

 

 

(39

)

 

Proceeds from issuance of debt, net

 

 

 

 

 

 

 

 

 

985

 

 

Other

13

 

 

 

35

 

 

 

13

 

 

 

37

 

 

Net cash provided by (used in) financing activities

(1,155

)

 

 

(291

)

 

 

(1,666

)

 

 

(877

)

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

2

 

 

 

4

 

 

 

 

 

 

 

 

Net change in cash, cash equivalents and restricted cash

(935

)

 

 

93

 

 

 

(957

)

 

 

1,562

 

 

Cash, cash equivalents and restricted cash at beginning of period

5,626

 

 

 

3,818

 

 

 

5,648

 

 

 

2,349

 

 

Cash, cash equivalents and restricted cash at end of period

$

4,691

 

 

 

$

3,911

 

 

 

$

4,691

 

 

 

$

3,911

 

 


NEWMONT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)




 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2021

 

2020

 

2021

 

2020

Reconciliation of cash, cash equivalents and restricted cash:

 

 

 

 

 

Cash and cash equivalents

$

4,583

 

 

$

3,808

 

 

$

4,583

 

 

$

3,808

 

Restricted cash included in Other current assets

1

 

 

 

 

1

 

 

 

Restricted cash included in Other non-current assets

107

 

 

103

 

 

107

 

 

103

 

Total cash, cash equivalents and restricted cash

$

4,691

 

 

$

3,911

 

 

$

4,691

 

 

$

3,911

 


NEWMONT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in millions)




 

 

At June 30,
2021

 

At December 31,
2020

ASSETS

 

 

 

Cash and cash equivalents

$

4,583

 

 

 

$

5,540

 

 

Trade receivables

341

 

 

 

449

 

 

Investments

222

 

 

 

290

 

 

Inventories

965

 

 

 

963

 

 

Stockpiles and ore on leach pads

932

 

 

 

827

 

 

Other current assets

402

 

 

 

436

 

 

Current assets

7,445

 

 

 

8,505

 

 

Property, plant and mine development, net

24,500

 

 

 

24,281

 

 

Investments

3,220

 

 

 

3,197

 

 

Stockpiles and ore on leach pads

1,801

 

 

 

1,705

 

 

Deferred income tax assets

328

 

 

 

337

 

 

Goodwill

2,771

 

 

 

2,771

 

 

Other non-current assets

612

 

 

 

573

 

 

Total assets

$

40,677

 

 

 

$

41,369

 

 

 

 

 

 

LIABILITIES

 

 

 

Accounts payable

$

503

 

 

 

$

493

 

 

Employee-related benefits

296

 

 

 

380

 

 

Income and mining taxes payable

333

 

 

 

657

 

 

Lease and other financing obligations

110

 

 

 

106

 

 

Debt

491

 

 

 

551

 

 

Other current liabilities

1,054

 

 

 

1,182

 

 

Current liabilities

2,787

 

 

 

3,369

 

 

Debt

4,989

 

 

 

5,480

 

 

Lease and other financing obligations

567

 

 

 

565

 

 

Reclamation and remediation liabilities

3,855

 

 

 

3,818

 

 

Deferred income tax liabilities

2,239

 

 

 

2,073

 

 

Employee-related benefits

511

 

 

 

493

 

 

Silver streaming agreement

939

 

 

 

993

 

 

Other non-current liabilities

696

 

 

 

699

 

 

Total liabilities

16,583

 

 

 

17,490

 

 

 

 

 

 

Contingently redeemable noncontrolling interest

34

 

 

 

34

 

 

 

 

 

 

EQUITY

 

 

 

Common stock

1,287

 

 

 

1,287

 

 

Treasury stock

(197

)

 

 

(168

)

 

Additional paid-in capital

18,105

 

 

 

18,103

 

 

Accumulated other comprehensive income (loss)

(198

)

 

 

(216

)

 

Retained earnings

4,242

 

 

 

4,002

 

 

Newmont stockholders' equity

23,239

 

 

 

23,008

 

 

Noncontrolling interests

821

 

 

 

837

 

 

Total equity

24,060

 

 

 

23,845

 

 

Total liabilities and equity

$

40,677

 

 

 

$

41,369

 

 


Non-GAAP Financial Measures

Non-GAAP financial measures are intended to provide additional information only and do not have any standard meaning prescribed by U.S. 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. Unless otherwise noted, we present the Non-GAAP financial measures of our continuing operations in the tables below.

Adjusted net income (loss)

Management uses Adjusted net income (loss) to evaluate the Company’s operating performance and for planning and forecasting future business operations. The Company believes the use of Adjusted net income (loss) allows investors and others to understand the results of the continuing operations of the Company and its direct and indirect subsidiaries relating to the sale of products, by excluding certain items that have a disproportionate impact on our results for a particular period. Adjustments to continuing operations are presented before tax and net of our partners’ noncontrolling interests, when applicable. The tax effect of adjustments is presented in the Tax effect of adjustments line and is calculated using the applicable regional tax rate. Management’s determination of the components of Adjusted net income (loss) are evaluated periodically and based, in part, on a review of non-GAAP financial measures used by mining industry analysts. Net income (loss) attributable to Newmont stockholders is reconciled to Adjusted net income (loss) as follows:

 

Three Months Ended
June 30, 2021

 

Six Months Ended
June 30, 2021

 

 

 

per share data (1)

 

 

 

per share data (1)

 

 

 

basic

 

diluted

 

 

 

basic

 

diluted

Net income (loss) attributable to Newmont stockholders

$

650

 

 

 

$

0.81

 

 

 

$

0.81

 

 

 

$

1,209

 

 

 

$

1.51

 

 

 

$

1.51

 

 

Net loss (income) attributable to Newmont stockholders from discontinued operations

(10

)

 

 

(0.01

)

 

 

(0.01

)

 

 

(31

)

 

 

(0.04

)

 

 

(0.04

)

 

Net income (loss) attributable to Newmont stockholders from continuing operations

640

 

 

 

0.80

 

 

 

0.80

 

 

 

1,178

 

 

 

1.47

 

 

 

1.47

 

 

Change in fair value of investments (2)

(26

)

 

 

(0.03

)

 

 

(0.03

)

 

 

84

 

 

 

0.10

 

 

 

0.10

 

 

(Gain) loss on asset and investment sales (3)

 

 

 

 

 

 

 

 

 

(43

)

 

 

(0.05

)

 

 

(0.05

)

 

Reclamation and remediation charges (4)

20

 

 

 

0.02

 

 

 

0.02

 

 

 

30

 

 

 

0.04

 

 

 

0.04

 

 

Impairment of long-lived and other assets (5)

11

 

 

 

0.01

 

 

 

0.01

 

 

 

12

 

 

 

0.01

 

 

 

0.01

 

 

Settlement costs(6)

8

 

 

 

0.01

 

 

 

0.01

 

 

 

11

 

 

 

0.01

 

 

 

0.01

 

 

Restructuring and severance, net (7)

5

 

 

 

 

 

 

 

 

 

9

 

 

 

0.01

 

 

 

0.01

 

 

COVID-19 specific costs (8)

1

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

Tax effect of adjustments (9)

(11

)

 

 

 

 

 

 

 

 

(30

)

 

 

(0.03

)

 

 

(0.03

)

 

Valuation allowance and other tax adjustments, net (10)

22

 

 

 

0.03

 

 

 

0.02

 

 

 

11

 

 

 

0.02

 

 

 

0.02

 

 

Adjusted net income (loss)

$

670

 

 

 

$

0.84

 

 

 

$

0.83

 

 

 

$

1,264

 

 

 

$

1.58

 

 

 

$

1.58

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares (millions): (11)

 

801

 

 

 

803

 

 

 

 

 

801

 

 

 

802

 

 

(1)

Per share measures may not recalculate due to rounding.

(2)

Change in fair value of investments, included in Other income, net, primarily represents unrealized gains and losses related to the Company's investment in current and non-current marketable and other equity securities. For additional information regarding our investments, see Note 15 of the Condensed Consolidated Financial Statements.

(3)

(Gain) loss on asset and investment sales, included in Gain on asset and investment sales, net, primarily represents a gain on the sale of TMAC. For additional information, see Note 8 of the Condensed Consolidated Financial Statements.

(4)

Reclamation and remediation charges, included in Reclamation and remediation, represent revisions to reclamation and remediation plans at the Company's former operating properties and historic mining operations that have entered the closure phase and have no substantive future economic value.

(5)

Impairment of long-lived and other assets, included in Other expense, net, represents non-cash write-downs of various assets that are no longer in use.

(6)

Settlement costs, included in Other expense, net, primarily are comprised of a voluntary contribution made to the Republic of Suriname.

(7)

Restructuring and severance, net, included in Other expense, net, primarily represents severance and related costs associated with significant organizational or operating model changes implemented by the Company. Total amounts are presented net of income (loss) attributable to noncontrolling interests of $— and $(1), respectively.

(8)

COVID-19 specific costs included in Other expense, net, primarily include amounts distributed from the Newmont Global Community Fund to help host communities, governments and employees combat the COVID-19 pandemic. Adjusted net income (loss) has not been adjusted for $19 and $40, respectively, of incremental COVID-19 costs incurred as a result of actions taken to protect against the impacts of the COVID-19 pandemic at our operational sites. See Note 7 of the Condensed Consolidated Financial Statements for further information.

(9)

The tax effect of adjustments, included in Income and mining tax benefit (expense), represents the tax effect of adjustments in footnotes (2) through (8), as described above, and are calculated using the applicable regional tax rate.

(10)

Valuation allowance and other tax adjustments, net, included in Income and mining tax benefit (expense), is recorded for items such as foreign tax credits, alternative minimum tax credits, capital losses, disallowed foreign losses, and the effects of changes in foreign currency exchange rates on deferred tax assets and deferred tax liabilities. The adjustment for the three and six months ended June 30, 2021 is due to increases or (decreases) to net operating losses, tax credit carryovers and other deferred tax assets subject to valuation allowance of $9 and $30 respectively, the effects of changes in foreign exchange rates on deferred tax assets and liabilities of $11 and $(17) respectively, changes to the reserve for uncertain tax positions of $22 and $22 respectively, and other tax adjustments of $(17) and $(19), respectively. Total amount is presented net of income (loss) attributable to noncontrolling interests of $(3) and $(5), respectively.

(11)

Adjusted net income (loss) per diluted share is calculated using diluted common shares, which are calculated in accordance with U.S. GAAP.


 

 

Three Months Ended
June 30, 2020

 

Six Months Ended
June 30, 2020

 

 

 

per share data (1)

 

 

 

per share data (1)

 

 

 

basic

 

diluted

 

 

 

basic

 

diluted

Net income (loss) attributable to Newmont stockholders

$

344

 

 

 

$

0.43

 

 

 

$

0.43

 

 

 

$

1,166

 

 

 

$

1.45

 

 

 

$

1.45

 

 

Net loss (income) attributable to Newmont stockholders from discontinued operations

68

 

 

 

0.08

 

 

 

0.08

 

 

 

83

 

 

 

0.10

 

 

 

0.10

 

 

Net income (loss) attributable to Newmont stockholders from continuing operations

412

 

 

 

0.51

 

 

 

0.51

 

 

 

1,249

 

 

 

1.55

 

 

 

1.55

 

 

Gain (loss) on asset and investment sales, net (2)

1

 

 

 

 

 

 

 

 

 

(592

)

 

 

(0.73

)

 

 

(0.73

)

 

Change in fair value of investments (3)

(227

)

 

 

(0.28

)

 

 

(0.28

)

 

 

(134

)

 

 

(0.17

)

 

 

(0.17

)

 

Impairment of investments (4)

 

 

 

 

 

 

 

 

 

93

 

 

 

0.11

 

 

 

0.11

 

 

Loss on debt extinguishment (5)

3

 

 

 

 

 

 

 

 

 

77

 

 

 

0.09

 

 

 

0.09

 

 

COVID-19 specific costs (6)

33

 

 

 

0.04

 

 

 

0.04

 

 

 

35

 

 

 

0.04

 

 

 

0.04

 

 

Goldcorp transaction and integration costs (7)

7

 

 

 

0.01

 

 

 

0.01

 

 

 

23

 

 

 

0.03

 

 

 

0.03

 

 

Settlement costs (8)

2

 

 

 

0.01

 

 

 

0.01

 

 

 

8

 

 

 

0.01

 

 

 

0.01

 

 

Impairment of long-lived and other assets (9)

5

 

 

 

0.01

 

 

 

0.01

 

 

 

5

 

 

 

0.01

 

 

 

0.01

 

 

Restructuring and severance, net (10)

1

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

Pension settlements (11)

2

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

Tax effect of adjustments (12)

32

 

 

 

0.04

 

 

 

0.03

 

 

 

125

 

 

 

0.17

 

 

 

0.17

 

 

Valuation allowance and other tax adjustments, net (13)

(10

)

 

 

(0.01

)

 

 

(0.01

)

 

 

(306

)

 

 

(0.38

)

 

 

(0.38

)

 

Adjusted net income (loss) (14)

$

261

 

 

 

$

0.33

 

 

 

$

0.32

 

 

 

$

587

 

 

 

$

0.73

 

 

 

$

0.73

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares (millions): (15)

 

 

803

 

 

 

805

 

 

 

 

 

805

 

 

 

806

 

 

(1)

Per share measures may not recalculate due to rounding.

(2)

(Gain) loss on asset and investment sales, included in Gain on asset and investment sales, net, primarily represents gains on the sale of Kalgoorlie and Continental. For additional information, see Note 8 of the Condensed Consolidated Financial Statements.

(3)

Change in fair value of investments, included in Other income, net, primarily represents unrealized gains and losses related to the Company's investments in current and non-current marketable equity securities and our investment instruments. For additional information regarding our investments, see Note 15 of the Condensed Consolidated Financial Statements.

(4)

Impairment of investments, included in Other income, net, represents the other-than-temporary impairment of the TMAC investment.

(5)

Loss on debt extinguishment, included in Other income, net, primarily represents losses on the extinguishment of a portion of the 2022 Senior Notes and 2023 Senior Notes.

(6)

COVID-19 specific costs, included in Other expense, net, represent incremental direct costs incurred as a result of actions taken to protect against the impacts of the COVID-19 pandemic. See Note 7 of the Condensed Consolidated Financial Statements for further information.

(7)

Goldcorp transaction and integration costs, included in Other expense, net, primarily represent subsequent integration costs incurred during 2020 related to the Newmont Goldcorp transaction.

(8)

Settlement costs, included in Other expense, net, primarily represent certain costs associated with legal and other settlements.

(9)

Impairment of long-lived and other assets, included in Other expense, net, represents non-cash write-downs of long-lived assets.

(10)

Restructuring and severance, net, included in Other expense, net, primarily represents certain costs associated with severance and legal costs. Amounts are presented net of income (loss) attributable to noncontrolling interests of $(1) and $(1), respectively.

(11)

Pension settlements, included in Other income, net, represent pension settlement charges.

(12)

The tax effect of adjustments, included in Income and mining tax benefit (expense), represents the tax effect of adjustments in footnotes (2) through (11), as described above, and are calculated using the applicable regional tax rate.

(13)

Valuation allowance and other tax adjustments, included in Income and mining tax benefit (expense), is recorded for items such as foreign tax credits, alternative minimum tax credits, capital losses, disallowed foreign losses, and the effects of changes in foreign currency exchange rates on deferred tax assets and deferred tax liabilities. The adjustment for the three and six months ended June 30, 2020 is due to a net increase or (decrease) to net operating losses, tax credit carryovers and other deferred tax assets subject to valuation allowance of $(11) and $(120), respectively, the effects of changes in foreign exchange rates on deferred tax assets and liabilities of $(8) and $(187), respectively, changes to the reserve for uncertain tax positions of $15 and $(9), respectively, and other tax adjustments of $1 and $32, respectively. Total amount is presented net of income (loss) attributable to noncontrolling interests of $(7) and $(22), respectively.

(14)

Adjusted net income (loss) has not been adjusted for $115 and $133 of cash and $68 and $74 of non-cash care and maintenance costs, included in Care and maintenance and Depreciation and amortization, respectively, which primarily represent costs associated with our Musselwhite, Éléonore, Yanacocha and Cerro Negro sites being temporarily placed into care and maintenance in response to the COVID-19 pandemic during a portion of the three and six months ended June 30, 2020, respectively. Amounts are presented net of income (loss) attributable to noncontrolling interests of $10, $12, $2 and $3, respectively.

(15)

Adjusted net income (loss) per diluted share is calculated using diluted common shares, which are calculated in accordance with U.S. GAAP.


Earnings before interest, taxes and depreciation and amortization and Adjusted earnings before interest, taxes and depreciation and amortization

Management uses Earnings before interest, taxes and depreciation and amortization (“EBITDA”) and EBITDA adjusted for non-core or certain items that have a disproportionate impact on our results for a particular period (“Adjusted EBITDA”) as non-GAAP measures to evaluate the Company’s operating performance. EBITDA and Adjusted EBITDA do not represent, and should not be considered an alternative to, net income (loss), operating income (loss), or cash flow from operations as those terms are defined by GAAP, and do not necessarily indicate whether cash flows will be sufficient to fund cash needs. Although Adjusted EBITDA and similar measures are frequently used as measures of operations and the ability to meet debt service requirements by other companies, our calculation of Adjusted EBITDA is not necessarily comparable to such other similarly titled captions of other companies. The Company believes that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors. Management’s determination of the components of Adjusted EBITDA are evaluated periodically and based, in part, on a review of non-GAAP financial measures used by mining industry analysts. Net income (loss) attributable to Newmont stockholders is reconciled to EBITDA and Adjusted EBITDA as follows:


Three Months Ended
June 30,

 

Six Months Ended
June 30,

2021

 

2020

 

2021

 

2020

Net income (loss) attributable to Newmont stockholders

$

650

 

 

 

$

344

 

 

 

$

1,209

 

 

 

$

1,166

 

 

Net income (loss) attributable to noncontrolling interests

11

 

 

 

3

 

 

 

31

 

 

 

5

 

 

Net loss (Income) from discontinued operations

(10

)

 

 

68

 

 

 

(31

)

 

 

83

 

 

Equity loss (income) of affiliates

(49

)

 

 

(29

)

 

 

(99

)

 

 

(66

)

 

Income and mining tax expense (benefit)

341

 

 

 

164

 

 

 

576

 

 

 

141

 

 

Depreciation and amortization

561

 

 

 

528

 

 

 

1,114

 

 

 

1,093

 

 

Interest expense, net of capitalized interest

68

 

 

 

78

 

 

 

142

 

 

 

160

 

 

EBITDA

$

1,572

 

 

 

$

1,156

 

 

 

$

2,942

 

 

 

$

2,582

 

 

Adjustments:

 

 

 

 

 

 

 

Change in fair value of investments (1)

$

(26

)

 

 

$

(227

)

 

 

$

84

 

 

 

$

(134

)

 

(Gain) loss on asset and investment sales (2)

 

 

 

1

 

 

 

(43

)

 

 

(592

)

 

Reclamation and remediation charges (3)

20

 

 

 

 

 

 

30

 

 

 

 

 

Impairment of long-lived and other assets (4)

11

 

 

 

5

 

 

 

12

 

 

 

5

 

 

Settlement costs (5)

8

 

 

 

2

 

 

 

11

 

 

 

8

 

 

Restructuring and severance (6)

5

 

 

 

2

 

 

 

10

 

 

 

3

 

 

COVID-19 specific costs (7)

1

 

 

33

 

 

 

2

 

 

 

35

 

 

Impairment of investments (8)

 

 

 

 

 

 

 

 

 

93

 

 

Loss on debt extinguishment (9)

 

 

 

3