Newmont Goldcorp Corporation (NYSE: NEM, TSX: NGT) (Newmont Goldcorp or the Company) today announced third quarter 2019 results.

  • Net income: Delivered GAAP net income from continuing operations attributable to Newmont Goldcorp stockholders of $2,226 million or $2.71 per diluted share; delivered adjusted net income1 of $292 million or $0.36 per diluted share, an increase of $0.03 compared to the prior year quarter
  • EBITDA: Generated $1,079 million in adjusted EBITDA2, an increase of 70 percent from the prior year quarter
  • Cash flow: Reported consolidated cash flow from continuing operations of $793 million and free cash flow3 of $365 million, an increase of 85 percent and 137 percent over the prior year quarter, respectively
  • Gold costs applicable to sales (CAS)4: Reported CAS of $733 per ounce, an increase of 6 percent over the prior year quarter
  • Gold all-in sustaining costs (AISC)5: Reported AISC of $987 per ounce, an increase of 10 percent over the prior year quarter
  • Attributable gold production: Produced 1.64 million ounces of gold, an increase of 28 percent over the prior year quarter
  • Portfolio improvements: Closed the Nevada Gold Mines joint venture; divested the Nimba iron ore project in Guinea; announced process to review potential sale opportunities for Red Lake in Canada; achieved commercial production at the Borden mine in Canada, Ahafo Mill Expansion in Ghana, and Quecher Main in Peru; advanced Tanami Expansion 2 to execution
  • Financial strength: Ended the quarter with $2.7 billion of consolidated cash and net debt of $4.8 billion, supporting an investment-grade credit profile; declared a third quarter dividend of $0.14 per share
  • Outlook: 2019 attributable production of 6.3 million ounces, CAS at $715 per ounce and AISC at $965 per ounce

“Newmont Goldcorp generated $1,079 million in adjusted EBITDA and $365 million in free cash flow for the third quarter, building momentum for an even stronger fourth quarter,” said Tom Palmer, President and Chief Executive Officer. “We expect to deliver $240 million in annual run-rate improvements by the end of 2019 and exceed our initial synergy targets from the Goldcorp acquisition. We also continued to strengthen our portfolio and advance profitable growth by bringing on Borden, the Ahafo Mill Expansion and Quecher Main on time and within budget.”

Third Quarter 2019 Summary Results

Net income (loss) from continuing operations attributable to Newmont stockholders for the quarter was $2,226 million or $2.71 per diluted share, an increase of $2,387 million from the prior year quarter primarily due to the gain recognized on the formation of Nevada Gold Mines as well as higher production and realized gold prices.

Adjusted net income was $292 million or $0.36 per diluted share, compared to $175 million or $0.33 per diluted share in the prior year quarter. The adjustments to net income of $2.35 primarily related to a gain on the formation of Nevada Gold Mines, transaction costs associated with the Newmont Goldcorp transaction, tax and valuation allowance adjustments, changes in the fair value of investments, and reclamation and remediation charges.

Revenue rose 57 percent to $2,713 million for the quarter primarily due to higher realized gold prices and higher sales volumes, including a full quarter from the Goldcorp assets.

Average realized price6 for gold was $1,476, an increase of $275 per ounce over the prior year quarter; average realized price for copper was $2.37, a decrease of $0.13 per pound over the prior year quarter; average realized price for silver, lead and zinc were $17.18 per ounce, $0.84 per pound and $0.81 per pound, respectively.

Gold CAS increased 29 percent to $1,232 million for the quarter due to a full quarter of costs included from the Goldcorp assets. Gold CAS per ounce increased 6 percent from the prior year quarter to $733 per ounce primarily due to gold price-related royalties, and higher unit costs at Peñasquito and Red Lake, partially offset by higher ounces sold and lower stockpile and leachpad inventory adjustments.

Gold AISC increased 10 percent to $987 per ounce for the quarter primarily due to higher gold CAS per ounce and higher sustaining capital spend.

Attributable gold production7 increased 28 percent to 1.64 million ounces for the quarter primarily due to new production from the Goldcorp assets and higher grades at Ahafo, partially offset by lower grades at KCGM, Boddington, Yanacocha and Merian.

Attributable gold equivalent ounce (GEO) production from other metals increased to 236 thousand ounces primarily due to new silver, lead and zinc production from Peñasquito, partially offset by the classification of copper as a by-product following the formation of Nevada Gold Mines and lower copper grades at Boddington. CAS from other metals totaled $160 million for the quarter. CAS per GEO increased 5 percent to $747 per ounce primarily due to an unfavorable strip ratio and higher mill maintenance costs at Boddington in Australia. AISC per GEO increased 33 percent to $1,155 per ounce primarily due to higher sustaining capital spend, higher treatment and refining costs and higher CAS per GEO.

Capital expenditures8 rose by 56 percent to $428 million, primarily due to increased sustaining capital investment from a full quarter with the Goldcorp assets and higher spending for growth projects, including Quecher Main, Ahafo Mill Expansion, Tanami Expansion 2, Yanacocha Sulfides, and Ahafo North.

Consolidated operating cash flow from continuing operations increased 85 percent from the prior year quarter to $793 million due to higher realized gold prices and inclusion of sales from the Goldcorp assets, partially offset by costs related to the Newmont Goldcorp transaction. Free cash flow also increased to $365 million for the quarter, primarily due to higher operating cash flow, partially offset by higher capital expenditures.

Balance sheet ended the quarter with $2.7 billion of consolidated cash and a leverage ratio of 1.4x net debt to pro forma adjusted EBITDA9, issued $700 million of 2.800 percent Senior Notes due 2029 and retired $626 million of 5.125 percent Senior Notes due 2019 on October 1.

Corporate update

Nevada Gold Mines joint venture: On July 1, 2019, Newmont Goldcorp and Barrick Gold Corporation consummated the transaction establishing Nevada Gold Mines LLC (NGM). NGM is owned 38.5 percent by Newmont Goldcorp and owned 61.5 percent and operated by Barrick. The formation of NGM diversifies the Company’s footprint in Nevada and allows Newmont Goldcorp to benefit from additional efficiencies through integrated mine planning and processing. The Company accounts for its interest in NGM using the proportionate consolidation method, thereby recognizing its pro-rata share of the assets, liabilities and operations of NGM. Third quarter EBITDA for NGM was $234 million. Attributable gold production was 344 thousand ounces with CAS of $701 per ounce and AISC of $920 per ounce.

Projects update

Newmont Goldcorp’s capital-efficient project pipeline supports stable production with improving margins and mine life. Near-term development capital projects and recently completed projects are presented below. Funding for Musselwhite Materials Handling has been approved and the project is in execution. Additional projects not listed below represent incremental improvements to production and cost guidance. Internal rates of return (IRR) on these projects are calculated at a $1,200 gold price.

  • Quecher Main (South America) adds oxide production at Yanacocha, leverages existing infrastructure and enables potential future growth at Yanacocha. First production was achieved in late 2018 and commercial production was declared on October 31, 2019. Quecher Main extends the life of the Yanacocha operation to 2027 with average annual gold production of approximately 200,000 ounces per year between 2020 and 2025 (100 percent basis). During the same period, incremental CAS is expected to be between $750 and $850 per ounce and AISC between $900 and $1,000 per ounce. The full project, including future leach pad expansions, is expected to be completed for approximately $275 million10 of development capital which is below the Company’s initial estimate. The project IRR is expected to be 15 percent.
  • Ahafo Mill Expansion (Africa) is designed to maximize resource value by improving production margins and accelerating stockpile processing. The project also supports profitable development of Ahafo’s highly prospective underground resources. First production was achieved in September 2019 and commercial production was declared on October 15, 2019. The expansion is expected to increase average annual gold production by between 75,000 and 100,000 ounces per year for the first five years beginning in 2020. Capital cost for the project was approximately $175 million. The project IRR is expected to be more than 20 percent.
  • Borden, North America (North America) is a new underground mine expected to extend profitable production at the Porcupine complex. Commercial production was declared on October 1, 2019.
  • Musselwhite Materials Handling (North America) improves material movement from Musselwhite’s two main zones below Lake Opapimiskan. An underground shaft will hoist ore from the underground crushers, reducing haulage distances and ventilation costs. The Company expects the project to be fully operational in mid-2020 after development progress was impacted by the conveyor fire at Musselwhite.

1

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

2

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

3

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

4

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

5

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

6

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

7

Attributable gold production includes 94,000 ounces from the Company’s equity method investment in Pueblo Viejo (40%)

8

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

9

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

10

The Quecher Main project has incurred development capital costs of approximately $185 million through October 31, 2019, and will complete Phase 3 and 4 of the leach pad expansion over the next 3 years with a remaining capital investment of approximately $90 million.

Outlook

Newmont Goldcorp’s 2019 outlook reflects a full-year of Newmont operated assets and the Goldcorp assets from April 18, 2019. The Company does not include development projects that have not yet been funded or reached execution stage in the outlook below, which represents upside to guidance. The Nevada guidance includes the Company’s owned and operated Nevada assets through June 30, 2019, and has been updated to reflect the Company’s ownership interest in Nevada Gold Mines for July 1, 2019 to December 31, 2019. Longer term guidance is expected to be updated on December 2, 2019.

Attributable gold production is expected to be 6.3 million ounces in 2019. Production is fourth quarter weighted with the completion of the Ahafo Mill Expansion in Africa, the Borden project in Canada and higher grades expected at Cerro Negro, Éléonore, and Tanami.

  • North America production is expected to be 1.1 million ounces in 2019. The outlook includes the impact from the blockades at Peñasquito, the conveyor fire at Musselwhite, installation of additional safety controls at Red Lake, and lower grades in the third quarter at Éléonore.
  • South America production is expected to be 1.3 million ounces in 2019 with a strong fourth quarter as Cerro Negro reaches higher grades from the Eureka and Mariana Norte zones.
  • Australia production is expected to be 1.4 million ounces in 2019 reflecting the impact of current mining restrictions at KCGM.
  • Africa production is expected to be 1.1 million ounces in 2019 with a full year of production from Subika Underground, higher grades from Subika open pit and improved mill throughput in the second half of the year with completion of the Ahafo Mill Expansion project.
  • Nevada production is expected to be 1.5 million ounces in 2019, which has been updated to reflect Nevada Gold mines for the second half of 2019.

Gold cost outlook CAS is expected to be $715 per ounce and AISC is expected to be $965 per ounce in 2019.

  • North America CAS is expected to be $895 per ounce and AISC is expected to be $1,210 per ounce in 2019. The outlook includes the impact from the blockades at Peñasquito, the conveyor fire at Musselwhite, installation of additional safety controls at Red Lake, and lower grades in the third quarter at Éléonore.
  • South America CAS is expected to be $630 per ounce and AISC is expected to be $785 per ounce in 2019.
  • Australia CAS is expected to be $740 per ounce in 2019 and AISC is expected to be $920 in 2019 and has been updated to reflect improved unit costs at Boddington.
  • Africa CAS is expected to be $585 per ounce in 2019 and AISC is expected to be $770 per ounce in 2019.
  • Nevada CAS is expected to be $750 per ounce in 2019 and AISC is expected to be $945 per ounce in 2019, which has improved with the inclusion of Nevada Gold Mines for the second half of 2019.

Co-product GEOs – Attributable production is expected to be 625,000 GEOs in 2019, which includes silver, zinc, and lead production from Peñasquito, and copper production from Boddington and from Phoenix through June 30, 2019 prior to the formation of Nevada Gold Mines. CAS is expected to be $820 per GEO and AISC is expected to be $1,190 per GEO in 2019.

Capital – Total consolidated capital is expected to be $1,530 million for 2019. Development capital of $550 million in 2019 includes investments in the Borden and Musselwhite Materials Handling projects in North America, Quecher Main in South America, Ahafo Mill Expansion in Africa, and Tanami Power Project in Australia, and expenditures to advance studies for future projects. Sustaining capital is expected to be $980 million for 2019 and includes the Awonsu layback and investments to cover infrastructure, equipment and ongoing mine development.

Consolidated expense outlook The Company’s 2019 outlook for general & administrative costs has been lowered to $315 million, which includes a faster realization of synergies from the Goldcorp integration. Interest expense is expected to be $280 million and investment in exploration and advanced projects is expected to be $415 million in 2019 and has been updated to reflect Nevada Gold Mines. Guidance for depreciation and amortization in 2019 is expected to be $2,050 million.

Assumptions – Newmont Goldcorp’s outlook assumes $1,200 per ounce gold price, $16 per ounce silver price, $2.50 per pound copper price, $1.05 per pound zinc price, $0.90 per pound lead price, $0.70 USD/AUD exchange rate, $0.77 USD/CAD exchange rate, and $65 per barrel WTI oil price.

2019 Outlooka

2019 Outlook +/- 5%

Consolidated
Production

 

Attributable
Production

 

Consolidated
CAS

 

Consolidated
All-in Sustaining
Costsb

 

Consolidated
Sustaining
Capital
Expenditures

 

Consolidated
Development
Capital
Expenditures

(Koz, GEO Koz)

 

(Koz, GEO Koz)

 

($/oz)

 

($/oz)

 

($M)

 

($M)

North America

1,060

 

1,060

 

895

 

1,210

 

305

 

125

South America

1,375

 

1,295

 

630

 

785

 

120

 

185

Australia

1,420

 

1,420

 

740

 

920

 

195

 

65c

Africa

1,105

 

1,105

 

585

 

770

 

125

 

110

Nevada

1,470

 

1,470

 

750

 

945

 

225

 

50

Total Goldd

6,400

 

6,300

 

715

 

965

 

980e

 

550e

 

 

 

 

 

 

 

 

 

 

 

Total Co-products

625

 

625

 

820

 

1,190

 

 

 

 

2019 Consolidated Expense Outlook ($M)
General & Administrative

315

Interest Expense

280

Depreciation and Amortization

2,050

Advanced Projects & Exploration

415

Adjusted Tax Ratef,g

34%-39%

a

2019 outlook projections used in this presentation are considered forward-looking statements and represent management’s good faith estimates or expectations of future production results as of November 5, 2019. Outlook is based upon certain assumptions, including, but not limited to, metal prices, oil prices, certain exchange rates and other assumptions. For example, 2019 Outlook assumes $1,200/oz Au, $16/oz Ag, $2.50/lb Cu, $1.05/lb Zn, $0.90/lb Pb, $0.70 USD/AUD exchange rate, $0.77 USD/CAD exchange rate and $65/barrel WTI; AISC and CAS estimates do not include inflation, for the remainder of the year. Production, CAS, AISC and capital estimates exclude projects that have not yet been approved. The potential impact on inventory valuation as a result of lower prices, input costs, and project decisions are not included as part of this Outlook. Estimates include the impact of the Newmont Goldcorp transaction and the impact of the Nevada Gold Mines joint venture which closed on July 1, 2019. 2019 Nevada outlook includes the Company’s owned and operated Nevada assets through June 30, 2019, and has been updated to reflect the Company’s ownership interest in Nevada Gold Mines for July 1, 2019 to December 31, 2019. Assumptions used for purposes of Outlook may prove to be incorrect and actual results may differ from those anticipated, including variation beyond a +/-5% range. Outlook cannot be guaranteed. As such, investors are cautioned not to place undue reliance upon Outlook and forward-looking statements as there can be no assurance that the plans, assumptions or expectations upon which they are placed will occur. Amounts may not recalculate to totals due to rounding. See cautionary note at the end of this release.

b

All-in sustaining costs or AISC as used in the Company’s Outlook is a non-GAAP metric; see below for further information and reconciliation to consolidated 2019 CAS outlook.

c

Includes finance lease payments related to the Tanami Power Project paid over a 10 year term beginning in 2019.

d

Attributable gold production outlook includes the Company’s equity investment (40%) in Pueblo Viejo but does not include other equity investments.

e

Total development capital includes ~$15 million of corporate and other spend and total sustaining capital includes ~$10 million of corporate and other spend.

f

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

g

Assuming average prices of $1,300 per ounce for gold, $16 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 2019 will be between 34%-39%.

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

Operating Results

2019

 

2018

 

% Change

 

2019

 

2018

 

% Change

Attributable Sales (koz)

 

 

 

 

 

 

 

 

 

 

 

 

Attributable gold ounces sold

 

1,578

 

1,270

24

%

 

4,352

 

3,648

19

%

Attributable gold equivalent ounces sold

 

213

 

60

255

%

 

357

 

177

102

%

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

Average realized gold price

$

1,476

$

1,201

23

%

$

1,370

$

1,271

8

%

Average realized copper price

$

2.37

$

2.50

(5

)%

$

2.59

$

2.79

(7

)%

Average realized silver price

$

17.18

$

%

$

16.23

$

%

Average realized lead price

$

0.84

$

%

$

0.81

$

%

Average realized zinc price

$

0.81

$

%

$

0.81

$

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Attributable Production (koz)

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

325

 

82

296

%

 

657

 

217

203

%

South America

 

275

 

178

54

%

 

720

 

463

56

%

Australia

 

339

 

385

(12

)%

 

1,038

 

1,142

(9

)%

Africa

 

267

 

212

26

%

 

775

 

621

25

%

Nevada

 

344

 

429

(20

)%

 

1,102

 

1,214

(9

)%

Pueblo Viejo (40%)1

 

94

 

%

 

169

 

%

Total Gold

 

1,644

 

1,286

28

%

 

4,461

 

3,657

22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

203

 

%

 

256

 

%

Australia

 

33

 

40

(18

)%

 

104

 

132

(21

)%

Nevada

 

 

16

(100

)%

 

35

 

48

(27

)%

Total Gold Equivalent Ounces

 

236

 

56

321

%

 

395

 

180

119

%

 

 

 

 

 

 

 

 

 

 

 

 

 

CAS Consolidated ($/oz, $/GEO)

 

 

 

 

 

 

 

 

 

 

 

 

North America

$

945

$

825

15

%

$

976

$

710

37

%

South America

$

669

$

636

5

%

$

638

$

704

(9

)%

Australia

$

768

$

691

11

%

$

749

$

703

7

%

Africa

$

563

$

505

11

%

$

586

$

670

(13

)%

Nevada

$

711

$

799

(11

)%

$

761

$

803

(5

)%

Total Gold

$

733

$

691

6

%

$

733

$

729

1

%

Total Gold (by-product)

$

691

$

671

3

%

$

717

$

705

2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

$

756

$

%

$

980

$

%

Australia

$

758

$

675

12

%

$

819

$

727

13

%

Nevada

$

$

861

(100

)%

$

750

$

886

(15

)%

Total Gold Equivalent Ounces

$

747

$

713

5

%

$

908

$

768

18

%

 

 

 

 

 

 

 

 

 

 

 

 

 

AISC Consolidated ($/oz)

 

 

 

 

 

 

 

 

 

 

 

 

North America

$

1,276

$

927

38

%

$

1,290

$

863

49

%

South America

$

841

$

822

2

%

$

803

$

870

(8)

%

Australia

$

944

$

811

16

%

$

911

$

832

9

%

Africa

$

741

$

679

9

%

$

776

$

818

(5

)%

Nevada

$

915

$

969

(6

)%

$

956

$

982

(3

)%

Total Gold

$

987

$

895

10

%

$

974

$

937

4

%

Total Gold (by-product)

$

997

$

882

13

%

$

986

$

920

7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

$

1,226

$

%

$

1,471

$

%

Australia

$

907

$

803

13

%

$

966

$

865

12

%

Nevada

$

$

1,114

(100

)%

$

894

$

1,095

(18

)%

Total Gold Equivalent Ounces

$

1,155

$

867

33

%

$

1,259

$

924

36

%

1

Represents attributable gold from the Company’s equity method investment in Pueblo Viejo (40%). Income and expenses of equity method investments are included in Equity income (loss) of affiliates.

 

NEWMONT GOLDCORP CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in millions except per share)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

 

 

 

 

 

 

 

Sales

$

2,713

 

$

1,726

 

$

6,773

 

$

5,205

 

 

 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

 

Costs applicable to sales (1)

 

1,392

 

 

995

 

 

3,736

 

 

2,989

 

Depreciation and amortization

 

548

 

 

299

 

 

1,347

 

 

879

 

Reclamation and remediation

 

62

 

 

31

 

 

165

 

 

96

 

Exploration

 

88

 

 

48

 

 

198

 

 

142

 

Advanced projects, research and development

 

43

 

 

37

 

 

102

 

 

107

 

General and administrative

 

84

 

 

59

 

 

224

 

 

181

 

Impairment of long-lived assets

 

3

 

 

366

 

 

4

 

 

366

 

Other expense, net

 

35

 

 

5

 

 

239

 

 

29

 

 

 

2,255

 

 

1,840

 

 

6,015

 

 

4,789

 

Other income (expense):

 

 

 

 

 

 

 

 

Gain on formation of Nevada Gold Mines

 

2,366

 

 

 

2,366

 

 

Other income, net

 

31

 

 

37

 

 

166

 

 

197

 

Interest expense, net of capitalized interest

 

(77

)

 

(51

)

 

(217

)

 

(153

)

 

 

2,320

 

 

(14

)

 

2,315

 

 

44

 

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

 

2,778

 

 

(128

)

 

3,073

 

 

460

 

Income and mining tax benefit (expense)

 

(558

)

 

(3

)

 

(703

)

 

(126

)

Equity income (loss) of affiliates

 

32

 

 

(9

)

 

53

 

 

(25

)

Net income (loss) from continuing operations

 

2,252

 

 

(140

)

 

2,423

 

 

309

 

Net income (loss) from discontinued operations

 

(48

)

 

16

 

 

(100

)

 

56

 

Net income (loss)

 

2,204

 

 

(124

)

 

2,323

 

 

365

 

Net loss (income) attributable to noncontrolling interests

 

(26

)

 

(21

)

 

(83

)

 

(26

)

Net income (loss) attributable to Newmont stockholders

$

2,178

 

$

(145

)

$

2,240

 

$

339

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to Newmont stockholders:

 

 

 

 

 

 

 

 

Continuing operations

$

2,226

 

$

(161

)

$

2,340

 

$

283

 

Discontinued operations

 

(48

)

 

16

 

 

(100

)

 

56

 

 

$

2,178

 

$

(145

)

$

2,240

 

$

339

 

Net income (loss) per common share

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

Continuing operations

$

2.72

 

$

(0.31

)

$

3.30

 

$

0.53

 

Discontinued operations

 

(0.06

)

 

0.04

 

 

(0.14

)

 

0.11

 

 

$

2.66

 

$

(0.27

)

$

3.16

 

$

0.64

 

Diluted:

 

 

 

 

 

 

 

 

Continuing operations

$

2.71

 

$

(0.31

)

$

3.30

 

$

0.53

 

Discontinued operations

 

(0.06

)

 

0.04

 

 

(0.14

)

 

0.10

 

 

$

2.65

 

$

(0.27

)

$

3.16

 

$

0.63

 

 

(1) Excludes Depreciation and amortization and Reclamation and remediation.

NEWMONT GOLDCORP CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in millions)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

Operating activities:

 

 

 

 

 

 

 

 

Net income (loss)

$

2,204

 

$

(124

)

$

2,323

 

$

365

 

Adjustments:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

548

 

 

299

 

 

1,347

 

 

879

 

Stock-based compensation

 

22

 

 

19

 

 

76

 

 

57

 

Reclamation and remediation

 

56

 

 

24

 

 

151

 

 

85

 

Loss (income) from discontinued operations

 

48

 

 

(16

)

 

100

 

 

(56

)

Deferred income taxes

 

435

 

 

(81

)

 

422

 

 

(100

)

Impairment of long-lived assets

 

4

 

 

366

 

 

4

 

 

366

 

Gain on asset and investment sales, net

 

1

 

 

(1

)

 

(32

)

 

(100

)

Gain on formation of Nevada Gold Mines

 

(2,366

)

 

 

(2,366

)

 

Write-downs of inventory and stockpiles and ore on leach pads

 

4

 

 

62

 

 

108

 

 

220

 

Other operating adjustments

 

(13

)

 

37

 

 

(56

)

 

46

 

Net change in operating assets and liabilities

 

(150

)

 

(157

)

 

(409

)

 

(667

)

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

 

793

 

 

428

 

 

1,668

 

 

1,095

 

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

 

(2

)

 

(3

)

 

(7

)

 

(8

)

Net cash provided by (used in) operating activities

 

791

 

 

425

 

 

1,661

 

 

1,087

 

Investing activities:

 

 

 

 

 

 

 

 

Additions to property, plant and mine development

 

(428

)

 

(274

)

 

(1,033

)

 

(763

)

Acquisitions, net (1)

 

6

 

 

(99

)

 

127

 

 

(138

)

Purchases of investments

 

(8

)

 

(11

)

 

(94

)

 

(17

)

Return of investment from an equity method investee

 

3

 

 

 

83

 

 

Proceeds from sales of investments

 

3

 

 

1

 

 

59

 

 

16

 

Proceeds from sales of other assets

 

 

18

 

 

29

 

 

23

 

Other

 

(14

)

 

(2

)

 

12

 

 

(5

)

Net cash provided by (used in) investing activities

 

(438

)

 

(367

)

 

(817

)

 

(884

)

Financing activities:

 

 

 

 

 

 

 

 

Repayment of debt

 

 

 

(1,250

)

 

Dividends paid to common stockholders

 

(109

)

 

(76

)

 

(775

)

 

(226

)

Proceeds from issuance of debt, net

 

690

 

 

 

690

 

 

Distributions to noncontrolling interests

 

(44

)

 

(38

)

 

(137

)

 

(107

)

Funding from noncontrolling interests

 

29

 

 

25

 

 

75

 

 

77

 

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

 

(3

)

 

 

(48

)

 

(39

)

Payments on lease and other financing obligations

 

(11

)

 

 

(37

)

 

(3

)

Proceeds from sale of noncontrolling interests

 

 

 

 

48

 

Repurchases of common stock

 

 

(26

)

 

 

(96

)

Other

 

(22

)

 

 

(24

)

 

Net cash provided by (used in) financing activities

 

530

 

 

(115

)

 

(1,506

)

 

(346

)

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

 

(2

)

 

(2

)

 

(4

)

 

(4

)

Net change in cash, cash equivalents and restricted cash

 

881

 

 

(59

)

 

(666

)

 

(147

)

Cash, cash equivalents and restricted cash at beginning of period

 

1,942

 

 

3,210

 

 

3,489

 

 

3,298

 

Cash, cash equivalents and restricted cash at end of period

$

2,823

 

$

3,151

 

$

2,823

 

$

3,151

 

 

 

 

 

 

 

 

 

 

Reconciliation of cash, cash equivalents and restricted cash:

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

2,712

 

$

3,068

 

$

2,712

 

$

3,068

 

Restricted cash included in Other current assets

 

19

 

 

1

 

 

19

 

 

1

 

Restricted cash included in Other noncurrent assets

 

92

 

 

82

 

 

92

 

 

82

 

Total cash, cash equivalents and restricted cash

$

2,823

 

$

3,151

 

$

2,823

 

$

3,151

 

(1)

Acquisitions, net for the three and nine months ended September 30, 2019 is comprised of cash, cash equivalents and restricted cash acquired, net of cash paid, in the Newmont Goldcorp transaction of $- and $121, respectively, and restricted cash acquired in the formation of Nevada Gold Mines of $6 and $6, respectively. In the 2018 periods, Acquisitions, net is comprised of mineral interest acquisitions, primarily Galore Creek.

 

.

NEWMONT GOLDCORP CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in millions)

 

 

 

At September 30,

 

At December 31,

 

 

2019

 

2018

ASSETS

 

 

 

 

Cash and cash equivalents

$

2,712

 

$

3,397

 

Trade receivables

 

383

 

 

254

 

Investments

 

157

 

 

48

 

Inventories

 

1,102

 

 

630

 

Stockpiles and ore on leach pads

 

760

 

 

697

 

Other current assets

 

584

 

 

251

 

Current assets

 

5,698

 

 

5,277

 

Property, plant and mine development, net

 

26,197

 

 

12,258

 

Investments

 

3,295

 

 

271

 

Stockpiles and ore on leach pads

 

1,521

 

 

1,866

 

Deferred income tax assets

 

440

 

 

401

 

Goodwill

 

3,078

 

 

58

 

Other non-current assets

 

534

 

 

584

 

Total assets

$

40,763

 

$

20,715

 

 

 

 

 

 

LIABILITIES

 

 

 

 

Debt

$

626

 

$

626

 

Accounts payable

 

532

 

 

303

 

Employee-related benefits

 

356

 

 

305

 

Income and mining taxes payable

 

132

 

 

71

 

Lease and other financing obligations

 

97

 

 

27

 

Other current liabilities

 

868

 

 

455

 

Current liabilities

 

2,611

 

 

1,787

 

Debt

 

6,139

 

 

3,418

 

Lease and other financing obligations

 

600

 

 

190

 

Reclamation and remediation liabilities

 

3,441

 

 

2,481

 

Deferred income tax liabilities

 

2,965

 

 

612

 

Employee-related benefits

 

454

 

 

401

 

Silver streaming agreement

 

1,069

 

 

Other non-current liabilities

 

1,000

 

 

314

 

Total liabilities

 

18,279

 

 

9,203

 

 

 

 

 

 

Contingently redeemable noncontrolling interest

 

49

 

 

47

 

 

 

 

 

 

EQUITY

 

 

 

 

Common stock

 

1,317

 

 

855

 

Treasury stock

 

(118

)

 

(70

)

Additional paid-in capital

 

18,460

 

 

9,618

 

Accumulated other comprehensive income (loss)

 

(265

)

 

(284

)

Retained earnings

 

2,036

 

 

383

 

Newmont stockholders' equity

 

21,430

 

 

10,502

 

Noncontrolling interests

 

1,005

 

 

963

 

Total equity

 

22,435

 

 

11,465

 

Total liabilities and equity

$

40,763

 

$

20,715

 

 

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 analysts 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

 

Nine Months Ended

 

September 30,

 

September 30,

 

2019

 

2018

 

2019

 

2018

Net income (loss) attributable to Newmont stockholders

$

2,178

 

$

(145

)

$

2,240

 

$

339

 

Net loss (income) attributable to Newmont stockholders from discontinued operations (1)

 

48

 

 

(16

)

 

100

 

 

(56

)

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

 

2,226

 

 

(161

)

 

2,340

 

 

283

 

Gain on formation of Nevada Gold Mines (2)

 

(2,366

)

 

 

(2,366

)

 

Goldcorp transaction and integration costs (3)

 

26

 

 

 

185

 

 

Change in fair value of investments (4)

 

(19

)

 

26

 

 

(75

)

 

21

 

Reclamation and remediation charges, net (5)

 

17

 

 

 

49

 

 

8

 

Loss (gain) on asset and investment sales, net (6)

 

1

 

 

(1

)

 

(30

)

 

(100

)

Nevada JV transaction and integration costs (7)

 

3

 

 

 

26

 

 

Restructuring and other, net (8)

 

10

 

 

1

 

 

15

 

 

13

 

Impairment of long-lived assets (9)

 

2

 

 

366

 

 

3

 

 

366

 

Impairment of investments (10)

 

1

 

 

 

2

 

 

Emigrant leach pad write-down (11)

 

 

29

 

 

 

29

 

Tax effect of adjustments (12)

 

439

 

 

(104

)

 

426

 

 

(88

)

Valuation allowance and other tax adjustments (13)

 

(48

)

 

19

 

 

(15

)

 

(28

)

Adjusted net income (loss)

$

292

 

$

175

 

$

560

 

$

504

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share, basic (14)

$

2.66

 

$

(0.27

)

$

3.16

 

$

0.64

 

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

 

0.06

 

 

(0.04

)

 

0.14

 

 

(0.11

)

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

 

2.72

 

 

(0.31

)

 

3.30

 

 

0.53

 

Gain on formation of Nevada Gold Mines

 

(2.88

)

 

 

(3.34

)

 

Goldcorp transaction and integration costs

 

0.03

 

 

 

0.26

 

 

Change in fair value of investments

 

(0.02

)

 

0.05

 

 

(0.10

)

 

0.04

 

Reclamation and remediation charges, net

 

0.02

 

 

 

0.07

 

 

0.01

 

Loss (gain) on asset and investment sales, net

 

 

(0.01

)

 

(0.04

)

 

(0.19

)

Nevada JV transaction and integration costs

 

 

 

0.05

 

 

Restructuring and other, net

 

0.01

 

 

 

0.03

 

 

0.02

 

Impairment of long-lived assets

 

 

0.69

 

 

 

0.69

 

Impairment of investments

 

 

 

 

Emigrant leach pad write-down

 

 

0.05

 

 

 

0.05

 

Tax effect of adjustments

 

0.54

 

 

(0.18

)

 

0.60

 

 

(0.15

)

Valuation allowance and other tax adjustments

 

(0.06

)

 

0.04

 

 

(0.04

)

 

(0.05

)

Adjusted net income (loss) per share, basic

$

0.36

 

$

0.33

 

$

0.79

 

$

0.95

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share, diluted (14)

$

2.65

 

$

(0.27

)

$

3.16

 

$

0.63

 

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

 

0.06

 

 

(0.04

)

 

0.14

 

 

(0.10

)

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

 

2.71

 

 

(0.31

)

 

3.30

 

 

0.53

 

Gain on formation of Nevada Gold Mines

 

(2.88

)

 

 

(3.34

)

 

Goldcorp transaction and integration costs

 

0.03

 

 

 

0.26

 

 

Change in fair value of investments

 

(0.02

)

 

0.05

 

 

(0.10

)

 

0.04

 

Reclamation and remediation charges, net

 

0.02

 

 

 

0.07

 

 

0.01

 

Loss (gain) on asset and investment sales, net

 

 

(0.01

)

 

(0.04

)

 

(0.19

)

Nevada JV transaction and integration costs

 

 

 

0.05

 

 

Restructuring and other, net

 

0.01

 

 

 

0.03

 

 

0.02

 

Impairment of long-lived assets

 

 

0.69

 

 

 

0.68

 

Impairment of investments

 

 

 

 

Emigrant leach pad write-down

 

 

0.05

 

 

 

0.05

 

Tax effect of adjustments

 

0.54

 

 

(0.18

)

 

0.60

 

 

(0.16

)

Valuation allowance and other tax adjustments

 

(0.05

)

 

0.04

 

 

(0.04

)

 

(0.04

)

Adjusted net income (loss) per share, diluted

$

0.36

 

 

0.33

 

$

0.79

 

$

0.94

 

 

 

 

 

 

 

 

 

 

Weighted average common shares (millions):

 

 

 

 

 

 

 

 

Basic

 

820

 

 

533

 

 

708

 

 

533

 

Diluted (15)

 

822

 

 

535

 

 

709

 

 

535

 

(1)

Net loss (income) attributable to Newmont stockholders from discontinued operations relates to (i) adjustments in our Holt royalty obligation, presented net of tax expense (benefit) of $-, $6, $- and $15, respectively, and (ii) adjustments to our Batu Hijau Contingent Consideration, presented net of tax expense (benefit) of $-, $(1), $- and $- respectively. For additional information regarding our discontinued operations, see Note 13 to our Condensed Consolidated Financial Statements.

(2)

Gain on formation of Nevada Gold Mines represents the difference between the fair value of our 38.5% interest in NGM and the carrying value of the Nevada mining operations contributed. For additional information regarding NGM, see Note 4 to our Condensed Consolidated Financial Statements.

(3)

Goldcorp transaction and integration costs, included in Other expense, net, represents costs incurred related to the Newmont Goldcorp transaction during 2019.

(4)

Change in fair value of marketable equity securities, included in Other income, net, primarily represents unrealized holding gains and losses on marketable equity securities and our investment instruments in Continental Gold Inc. For additional information regarding our investment in Continental, see Note 18 to our Condensed Consolidated Financial Statements.

(5)

Reclamation and remediation charges, included in Reclamation and remediation, represent revisions to remediation plans at the Company’s former historic mining operations. The 2019 charges include adjustments related to a review of the project cost estimates at the Dawn remediation site, as well as increased water management costs at the Con Mine.

(6)

Loss (gain) on asset and investment sales, included in Other income, net, primarily represents a gain on the sale of exploration property in North America in 2019 and a gain from the exchange of certain royalty interests for cash consideration and an equity ownership and warrants in Maverix in 2018. Amounts are presented net of income (loss) attributable to noncontrolling interests of $-, $-, $2 and $-, respectively.

(7)

Nevada JV transaction and integration costs, included in Other expense, net, primarily represents costs incurred related to the Nevada JV Agreement, including hostile defense fees, during 2019.

(8)

Restructuring and other, net included in Other expense, net, primarily represents certain costs associated with severance and employee-related benefits, and legal and other settlements of $2, $1, $7, $16. Restructuring and other, net included in Other income, net, primarily represents pension curtailments of $8, $-, $8, $-Amounts are presented net of income (loss) attributable to noncontrolling interests of $-, $-, $- and $(3), respectively.

(9)

Impairment of long-lived assets, included in Impairment of long-lived assets, represents non-cash write-downs of long-lived assets. The 2018 impairments relate to long-lived assets in North America in the third quarter of 2018. Amounts are presented net of income (loss) attributable to noncontrolling interests of $(1), $-, $(1) and $-, respectively.

(10)

Impairment of investments, included in Other income, net, represents other-than-temporary impairments of other investments.

(11)

The Emigrant leach pad write-down, included in Costs applicable to sales and Depreciation and amortization, represents a write-down to reduce the carrying value of the leach pad to net realizable value at Emigrant due to a change in mine plan resulting in a significant decrease in mine life in the third quarter of 2018.

(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 in the three and nine months ended September 30, 2019 is due to increases or (decreases) to net operating losses, tax credit carryovers and other deferred tax assets subject to valuation allowance of $87 and $111 respectively, the effects of changes in foreign exchange rates on deferred tax assets and liabilities of $(147) and $(150), respectively, additions to the reserve for uncertain tax positions of $7 and $21, respectively and other tax adjustments of $8 and $5, respectively. The adjustment in the three and nine months ended September 30, 2018 is due to increases to net operating losses, tax credit carryovers and other deferred tax assets of $13 and $32, respectively, and other tax adjustments of $5 and $4 respectively. The adjustment in the nine months ended September 30, 2018 is also due to a second quarter reduction to the provisional expense for the Tax Cuts and Jobs Act of $(45), a second quarter release of valuation allowance on capital losses of $(15). Amounts are presented net of income (loss) attributable to noncontrolling interests of $(3), $1, $(2) and $(4), respectively.

(14)

Per share measures may not recalculate due to rounding.

(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

 

Nine Months Ended

 

September 30,

 

September 30,

 

2019

 

2018

 

2019

 

2018

Net income (loss) attributable to Newmont stockholders

$

2,178

 

$

(145

)

$

2,240

 

$

339

 

Net income (loss) attributable to noncontrolling interests

 

26

 

 

21

 

 

83

 

 

26

 

Net loss (income) from discontinued operations (1)

 

48

 

 

(16

)

 

100

 

 

(56

)

Equity loss (income) of affiliates

 

(32

)

 

9

 

 

(53

)

 

25

 

Income and mining tax expense (benefit)

 

558

 

 

3

 

 

703

 

 

126

 

Depreciation and amortization

 

548

 

 

299

 

 

1,347

 

 

879

 

Interest expense, net

 

77

 

 

51

 

 

217

 

 

153

 

EBITDA

$

3,403

 

$

222

 

$

4,637

 

$

1,492

 

Adjustments:

 

 

 

 

 

 

 

 

Gain on formation of Nevada Gold Mines (2)

$

(2,366

)

$

$

(2,366

)

$

Goldcorp transaction and integration costs (3)

 

26

 

 

 

185

 

 

Change in fair value of investments (4)

 

(19

)

 

26

 

 

(75

)

 

21

 

Reclamation and remediation charges (5)

 

17

 

 

 

49

 

 

8

 

Loss (gain) on asset and investment sales (6)

 

1

 

 

(1

)

 

(32

)

 

(100

)

Nevada JV transaction and integration costs (7)

 

3

 

 

 

26

 

 

Restructuring and other (8)

 

10

 

 

1

 

 

15

 

 

16

 

Impairment of long-lived assets (9)

 

3

 

 

366

 

 

4

 

 

366

 

Impairment of investments (10)

 

1

 

 

 

2

 

 

Emigrant leach pad write-down (11)

 

 

22

 

 

 

22

 

Adjusted EBITDA

$

1,079

 

$

636

 

$

2,445

 

$

1,825

 

(1)

Net loss (income) from discontinued operations relates to (i) adjustments in our Holt royalty obligation, presented net of tax expense (benefit) of $-, $6, $- and $15, respectively, and (ii) adjustments to our Batu Hijau Contingent Consideration, presented net of tax expense (benefit) of $-, $(1), $-, and $-, respectively. For additional information regarding our discontinued operations, see Note 13 to our Condensed Consolidated Financial Statements.

(2)

Gain on formation of Nevada Gold Mines represents the difference between the fair value of our 38.5% interest in NGM and the carrying value of the Nevada mining operations contributed. For additional information regarding NGM, see Note 4 to our Condensed Consolidated Financial Statements.

(3)

Goldcorp transaction and integration costs, included in Other expense, net, primarily represents costs incurred related to the Newmont Goldcorp transaction during 2019.

(4)

Change in fair value of marketable equity securities, included in Other income, net, primarily represents unrealized holding gains and losses on marketable equity securities and our investment instruments in Continental Gold Inc. For additional information regarding our investment in Continental, see Note 20 to our Condensed Consolidated Financial Statements.

(5)

Reclamation and remediation charges, included in Reclamation and remediation, represent revisions to remediation plans at the Company’s former historic mining operations. The 2019 charges include adjustments related to a review of the project cost estimates at the Dawn remediation site, as well as increased water management costs at the Con Mine.

(6)

Loss (gain) on asset and investment sales, included in Other income, net, primarily represents a gain on the sale of exploration land in 2019 and a gain from the exchange of certain royalty interests for cash consideration and an equity ownership and warrants in Maverix in 2018.

(7)

Nevada JV transaction and integration costs, included in Other expense, net, primarily represents costs incurred related to the Nevada JV Agreement, including hostile defense fees, during 2019.

(8)

Restructuring and other, net included in Other expense, net, primarily represents certain costs associated with severance and employee-related benefits, and legal and other settlements of $2, $1, $7, $16. Restructuring and other, net included in Other income, net, primarily represents pension curtailments of $8, $-, $8, $-.

(9)

Impairment of long-lived assets, included in Impairment of long-lived assets, represents non-cash write-downs of long-lived assets. The 2018 impairments relate to long-lived assets in North America in the third quarter of 2018.

(10)

Impairment of investments, included in Other income, net, represents other-than-temporary impairments of other investments.

(11)

The Emigrant leach pad write-down, included in Costs applicable to sales, represents a write-down to reduce the carrying value of the leach pad to net realizable value at Emigrant due to a change in mine plan resulting in a significant decrease in mine life in the third quarter of 2018.

 

The Company uses NGM EBITDA as a non-GAAP measure to evaluate the operating performance of its investment in Nevada Gold Mines (NGM). NGM EBITDA does not represent, and should not be considered an alternative to, Income (loss) before income and mining tax and other items, as defined by GAAP, and does not necessarily indicate whether cash distributions from NGM will be consistent with NGM EBITDA. Although the Company has the ability to exert significant influence and proportionally consolidates its 38.5% interest in NGM, it does not have direct control over the operations or resulting revenues and expenses of its investment in NGM. The Company believes that NGM EBITDA provides useful information to investors and others in understanding and evaluating the operating results of its investment in NGM, in the same manner as management and the Board of Directors. Income (loss) before income and mining tax and other items is reconciled to NGM EBITDA as follows:

 

 

Three Months Ended

 

 

September 30, 2019

Income (Loss) before Income and Mining Tax and other items, NGM (1)

 

$

85

Depreciation and amortization (1)

 

 

149

NGM EBITDA

 

$

234

(1) See Note 5 to the Condensed Consolidated Financial Statements.

Free Cash Flow

Management uses Free Cash Flow as a non-GAAP measure to analyze cash flows generated from operations. Free Cash Flow is Net cash provided by (used in) operating activities less Net cash provided by (used in) operating activities of discontinued operations less Additions to property, plant and mine development as presented on the Condensed Consolidated Statements of Cash Flows. The Company believes Free Cash Flow is also useful as one of the bases for comparing the Company’s performance with its competitors. Although Free Cash Flow and similar measures are frequently used as measures of cash flows generated from operations by other companies, the Company’s calculation of Free Cash Flow is not necessarily comparable to such other similarly titled captions of other companies.

The presentation of non-GAAP Free Cash Flow is not meant to be considered in isolation or as an alternative to net income as an indicator of the Company’s performance, or as an alternative to cash flows from operating activities as a measure of liquidity as those terms are defined by GAAP, and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. The Company’s definition of Free Cash Flow is limited in that it does not represent residual cash flows available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, the Company believes it is important to view Free Cash Flow as a measure that provides supplemental information to the Company’s Condensed Consolidated Statements of Cash Flows.

The following table sets forth a reconciliation of Free Cash Flow, a non-GAAP financial measure, to Net cash provided by (used in) operating activities, which the Company believes to be the GAAP financial measure most directly comparable to Free Cash Flow, as well as information regarding Net cash provided by (used in) investing activities and Net cash provided by (used in) financing activities.

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

Net cash provided by (used in) operating activities

 

$

791

 

 

$

425

 

 

$

1,661

 

 

$

1,087

 

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

 

 

2

 

 

 

3

 

 

 

7

 

 

 

8

 

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

 

 

793

 

 

 

428

 

 

 

1,668

 

 

 

1,095

 

Less: Additions to property, plant and mine development

 

 

(428

)

 

 

(274

)

 

 

(1,033

)

 

 

(763

)

Free Cash Flow

 

$

365

 

 

$

154

 

 

$

635

 

 

$

332

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) investing activities (1)

 

$

(438

)

 

$

(367

)

 

$

(817

)

 

$

(884

)

Net cash provided by (used in) financing activities

 

$

530

 

 

$

(115

)

 

$

(1,506

)

 

$

(346

)

(1)

Net cash provided by (used in) investing activities includes Additions to property, plant and mine development, which is included in the Company’s computation of Free Cash Flow.

 

Costs applicable to sales per ounce/gold equivalent ounce

Costs applicable to sales per ounce/gold equivalent ounce are non-GAAP financial measures. These measures are calculated by dividing the costs applicable to sales of gold and other metals by gold ounces or gold equivalent ounces sold, respectively. These measures are calculated for the periods presented on a consolidated basis. Costs applicable to sales per ounce/gold equivalent ounce statistics are intended to provide additional information only and do not have any standardized meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The measures are not necessarily indicative of operating profit or cash flow from operations as determined under GAAP. Other companies may calculate these measures differently.

The following tables reconcile these non-GAAP measures to the most directly comparable GAAP measures

Costs applicable to sales per ounce

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

Costs applicable to sales (1)(2)

 

$

1,232

 

$

952

 

$

3,412

 

$

2,853

Gold sold (thousand ounces)

 

 

1,682

 

 

1,378

 

 

4,656

 

 

3,914

Costs applicable to sales per ounce (3)

 

$

733

 

$

691

 

$

733

 

$

729

(1)

Includes by-product credits of $31 and $60 during the three and nine months ended September 30, 2019, respectively, and $10 and $41 during the three and nine months ended September 30, 2018, respectively.

(2)

Excludes Depreciation and amortization and Reclamation and remediation.

(3)

Per ounce measures may not recalculate due to rounding.

Costs applicable to sales per gold equivalent ounce

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

Costs applicable to sales (1)(2)

 

$

160

 

$

43

 

$

324

 

$

136

Gold equivalent ounces - other metals (thousand ounces) (3)

 

 

213

 

 

60

 

 

357

 

 

177

Costs applicable to sales per ounce (4)

 

$

747

 

$

713

 

$

908

 

$

768

(1)

Includes by-product credits of $- and $2 during the three and nine months ended September 30, 2019, respectively, and $1 and $3 during the three and nine months ended September 30, 2018, respectively.

(2)

Excludes Depreciation and amortization and Reclamation and remediation.

(3)

Gold equivalent ounces is calculated as pounds or ounces produced multiplied by the ratio of the other metals price to the gold price, using Gold ($1,200/oz.), Copper ($2.75/lb.), Silver ($15/oz.), Lead ($0.90/lb.) and Zinc ($1.05/lb.) pricing for 2019 and Gold ($1,250/oz.) and Copper ($2.70/lb.) pricing for 2018.

(4)

Per ounce measures may not recalculate due to rounding.

Costs applicable to sales per ounce for Nevada Gold Mines (NGM)

 

 

 

Three Months Ended

 

 

September 30,

 

 

2019

Costs applicable to sales, NGM (1)(2)

 

$

235

Gold sold (thousand ounces), NGM

 

 

334

Costs applicable to sales per ounce, NGM (3)

 

$

701

(1)

See Note 5 to the Condensed Consolidated Financial Statements.

(2)

Excludes Depreciation and amortization and Reclamation and remediation.

(3)

Per ounce measures may not recalculate due to rounding.

All-In Sustaining Costs

Newmont has developed a metric that expands on GAAP measures, such as cost of goods sold, and non-GAAP measures, such as Costs applicable to sales per ounce, to provide visibility into the economics of our mining operations related to expenditures, operating performance and the ability to generate cash flow from our continuing operations.

Current GAAP measures used in the mining industry, such as cost of goods sold, do not capture all of the expenditures incurred to discover, develop and sustain production. Therefore, we believe that all-in sustaining costs is a non-GAAP measure that provides additional information to management, investors and analysts that aid in the understanding of the economics of our operations and performance compared to other producers and provides investors visibility by better defining the total costs associated with production.

All-in sustaining cost (“AISC”) amounts are intended to provide additional information only and do not have any standardized meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The measures are not necessarily indicative of operating profit or cash flow from operations as determined under GAAP. Other companies may calculate these measures differently as a result of differences in the underlying accounting principles, policies applied and in accounting frameworks such as in International Financial Reporting Standards (“IFRS”), or by reflecting the benefit from selling non-gold metals as a reduction to AISC. Differences may also arise related to definitional differences of sustaining versus development (i.e. non-sustaining) activities based upon each company’s internal policies.

The following disclosure provides information regarding the adjustments made in determining the all-in sustaining costs measure:

Costs applicable to sales. Includes all direct and indirect costs related to current production incurred to execute the current mine plan. We exclude certain exceptional or unusual amounts from Costs applicable to sales (“CAS”), such as significant revisions to recovery amounts. CAS includes by-product credits from certain metals obtained during the process of extracting and processing the primary ore-body. CAS is accounted for on an accrual basis and excludes Depreciation and amortization and Reclamation and remediation, which is consistent with our presentation of CAS on the Condensed Consolidated Statements of Operations. In determining AISC, only the CAS associated with producing and selling an ounce of gold is included in the measure. Therefore, the amount of gold CAS included in AISC is derived from the CAS presented in the Company’s Condensed Consolidated Statements of Operations less the amount of CAS attributable to the production of other metals at our Peñasquito, Boddington, and Phoenix mines. The other metals CAS at those mine sites is disclosed in Note 5 to the Condensed Consolidated Financial Statements. The allocation of CAS between gold and other metals at the Peñasquito, Boddington, and Phoenix mines is based upon the relative sales value of gold and other metals produced during the period.

Reclamation costs. Includes accretion expense related to Reclamation liabilities and the amortization of the related Asset Retirement Cost (“ARC”) for the Company’s operating properties. Accretion related to the Reclamation liabilities and the amortization of the ARC assets for reclamation does not reflect annual cash outflows but are calculated in accordance with GAAP. The accretion and amortization reflect the periodic costs of reclamation associated with current production and are therefore included in the measure. The allocation of these costs to gold and other metals is determined using the same allocation used in the allocation of CAS between gold and other metals at the Peñasquito, Boddington, and Phoenix mines.

Advanced projects, research and development and exploration. Includes incurred expenses related to projects that are designed to sustain current production and exploration. We note that as current resources are depleted, exploration and advanced projects are necessary for us to replace the depleting reserves or enhance the recovery and processing of the current reserves to sustain production at existing operations. As these costs relate to sustaining our production, and are considered a continuing cost of a mining company, these costs are included in the AISC measure. These costs are derived from the Advanced projects, research and development and Exploration amounts presented in the Condensed Consolidated Statements of Operations less incurred expenses related to the development of new operations, or related to major projects at existing operations where these projects will materially benefit the operation in the future. The allocation of these costs to gold and other metals is determined using the same allocation used in the allocation of CAS between gold and other metals at the Peñasquito, Boddington, and Phoenix mines.

General and administrative. Includes costs related to administrative tasks not directly related to current production, but rather related to support our corporate structure and fulfill our obligations to operate as a public company. Including these expenses in the AISC metric provides visibility of the impact that general and administrative activities have on current operations and profitability on a per ounce basis.

Other expense, net. We exclude certain exceptional or unusual expenses from Other expense, net, such as restructuring, as these are not indicative to sustaining our current operations. Furthermore, this adjustment to Other expense, net is also consistent with the nature of the adjustments made to Net income (loss) attributable to Newmont stockholders as disclosed in the Company’s non-GAAP financial measure Adjusted net income (loss). The allocation of these costs to gold and other metals is determined using the same allocation used in the allocation of CAS between gold and other metals at the Peñasquito, Boddington, and Phoenix mines.

Treatment and refining costs. Includes costs paid to smelters for treatment and refining of our concentrates to produce the salable metal. These costs are presented net as a reduction of Sales on our Condensed Consolidated Statements of Operations. The allocation of these costs to gold and other metals is determined using the same allocation used in the allocation of CAS between gold and other metals at the Peñasquito, Boddington, and Phoenix mines.

Sustaining capital and finance lease payments. We determined sustaining capital and finance lease payments as those capital expenditures and finance lease payments that are necessary to maintain current production and execute the current mine plan. Sustaining finance lease payments are included beginning in 2019 in connection with the adoption of ASC 842. Refer to Note 2 in the Condensed Consolidated Financial Statements for further details. We determined development (i.e. non-sustaining) capital expenditures and finance lease payments to be those payments used to develop new operations or related to projects at existing operations where those projects will materially benefit the operation. The classification of sustaining and development capital projects and finance leases is based on a systematic review of our project portfolio in light of the nature of each project. Sustaining capital and finance lease payments are relevant to the AISC metric as these are needed to maintain the Company’s current operations and provide improved transparency related to our ability to finance these expenditures from current operations. The allocation of these costs to gold and other metals is determined using the same allocation used in the allocation of CAS between gold and other metals at the Peñasquito, Boddington, and Phoenix mines.

 

 

 

 

 

 

 

 

Advanced

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Projects,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and

 

 

 

 

 

 

 

Treatment

 

Sustaining

 

 

 

 

 

 

All-In

 

 

Costs

 

 

 

 

Development

 

General

 

Other

 

and

 

Capital and

 

All-In

 

 

 

Sustaining

Three Months Ended

 

Applicable

 

Reclamation

 

and

 

and

 

Expense,

 

Refining

 

Lease Related

 

Sustaining

 

Ounces (000)

 

Costs per

September 30, 2019

 

to Sales (1)(2)(3)

 

Costs (4)

 

Exploration(5)

 

Administrative

 

Net (6)

 

Costs

 

Costs (7)(8)

 

Costs

 

Sold

 

oz. (9)

Gold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CC&V

 

$

65

 

$

 

$

2

 

$

 

$

 

$

 

$

13

 

$

80

 

73

 

$

1,087

Red Lake

 

 

45

 

 

2

 

 

2

 

 

 

 

 

 

 

 

8

 

 

57

 

31

 

 

1,872

Musselwhite

 

 

8

 

 

1

 

 

2

 

 

 

 

 

 

 

 

10

 

 

21

 

 

 

Porcupine

 

 

62

 

 

1

 

 

 

 

 

 

 

 

 

 

8

 

 

71

 

84

 

 

843

Éléonore

 

 

69

 

 

 

 

 

 

 

 

 

 

 

 

9

 

 

78

 

83

 

 

932

Peñasquito

 

 

39

 

 

1

 

 

 

 

 

 

 

 

1

 

 

18

 

 

59

 

35

 

 

1,681

Other North America

 

 

 

 

 

 

 

 

23

 

 

1

 

 

 

 

1

 

 

25

 

 

 

North America

 

 

288

 

 

5

 

 

6

 

 

23

 

 

1

 

 

1

 

 

67

 

 

391

 

306

 

 

1,276

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yanacocha

 

 

107

 

 

13

 

 

4

 

 

1

 

 

 

 

 

 

6

 

 

131

 

149

 

 

881

Merian

 

 

78

 

 

1

 

 

2

 

 

 

 

 

 

 

 

16

 

 

97

 

127

 

 

761

Cerro Negro

 

 

78

 

 

 

 

11

 

 

 

 

 

 

 

 

12

 

 

101

 

118

 

 

860

Other South America

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

2

 

 

 

South America

 

 

263

 

 

14

 

 

17

 

 

3

 

 

 

 

 

 

34

 

 

331

 

394

 

 

841

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Boddington

 

 

146

 

 

3

 

 

1

 

 

 

 

 

 

3

 

 

19

 

 

172

 

178

 

 

958

Tanami

 

 

64

 

 

 

 

2

 

 

 

 

 

 

 

 

18

 

 

84

 

112

 

 

758

Kalgoorlie

 

 

60

 

 

2

 

 

2

 

 

 

 

 

 

 

 

5

 

 

69

 

61

 

 

1,141

Other Australia

 

 

 

 

 

 

3

 

 

2

 

 

 

 

 

 

2

 

 

7

 

 

 

Australia

 

 

270

 

 

5

 

 

8

 

 

2

 

 

 

 

3

 

 

44

 

 

332

 

351

 

 

944

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ahafo

 

 

98

 

 

1

 

 

5

 

 

 

 

 

 

 

 

23

 

 

127

 

157

 

 

811

Akyem

 

 

51

 

 

8

 

 

 

 

 

 

 

 

 

 

5

 

 

64

 

107

 

 

612

Other Africa

 

 

 

 

 

 

 

 

3

 

 

1

 

 

 

 

 

 

4

 

 

 

Africa

 

 

149

 

 

9

 

 

5

 

 

3

 

 

1

 

 

 

 

28

 

 

195

 

264

 

 

741

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nevada Gold Mines

 

 

235

 

 

10

 

 

5

 

 

3

 

 

2

 

 

2

 

 

50

 

 

307

 

334

 

 

920

Carlin

 

 

8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8

 

11

 

 

854

Phoenix

 

 

15

 

 

 

 

 

 

 

 

 

 

2

 

 

 

 

17

 

13

 

 

1,187

Twin Creeks

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

8

 

 

340

Long Canyon

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

1

 

 

692

Other Nevada

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nevada

 

 

262

 

 

10

 

 

5

 

 

3

 

 

2

 

 

4

 

 

50

 

 

336

 

367

 

 

915

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and Other

 

 

 

 

 

 

18

 

 

50

 

 

 

 

 

 

8

 

 

76

 

 

 

Total Gold

 

$

1,232

 

$

43

 

$

59

 

$

84

 

$

4

 

$

8

 

$

231

 

$

1,661

 

1,682

 

$

987

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gold equivalent ounces - other metals (10)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Peñasquito

 

$

132

 

$

3

 

$

1

 

$

 

$

 

$

32

 

$

45

 

$

213

 

173

 

$

1,226

Boddington

 

 

28

 

 

 

 

 

 

 

 

 

 

2

 

 

3

 

 

33

 

37

 

 

907

Phoenix

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

Total Gold Equivalent Ounces

 

$

160

 

$

3

 

$

1

 

$

 

$

 

$

34

 

$

48

 

$

246

 

213

 

$

1,155

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

$

1,392

 

$

46

 

$

60

 

$

84

 

$

4

 

$

42

 

$

279

 

$

1,907

 

 

 

 

 

(1)

Excludes Depreciation and amortization and Reclamation and remediation.

(2)

Includes by-product credits of $31 and excludes co-product revenues of $230.

(3)

Includes stockpile and leach pad inventory adjustments of $1 at NGM.

(4)

Reclamation costs include operating accretion and amortization of asset retirement costs of $25 and $21, respectively, and exclude non-operating accretion and reclamation and remediation adjustments of $14 and $23, respectively.

(5)

Advanced projects, research and development and Exploration excludes development expenditures of $1 at Musselwhite, $4 at Porcupine, $2 at Éléonore, $1 at Peñasquito, $2 at Other North America, $2 at Yanacocha, $1 at Merian, $4 at Cerro Negro, $9 at Other South America, $6 at Other Australia, $3 at Ahafo, $4 at Akyem, $1 at Other Africa, $8 at NGM and $23 at Corporate and Other, totaling $71 related to developing new operations or major projects at existing operations where these projects will materially benefit the operation.

(6)

Other expense, net is adjusted for Newmont Goldcorp transaction and integration costs of $26, Nevada JV transaction implementation costs of $3, and restructuring and other costs of $2.

(7)

Includes sustaining capital expenditures of $98 for North America, $34 for South America, $44 for Australia, $27 for Africa, $50 for Nevada and $8 for Corporate and Other, totaling $261 and excludes development capital expenditures, capitalized interest and the increase in accrued capital totaling $167. The following are major development projects: Borden, Musselwhite Materials Handling, Quecher Main, Yanacocha Sulfides, Tanami Expansion 2, Ahafo North, Ahafo Mill Expansion and Turquoise Ridge 3rd shaft.

(8)

Includes finance lease payments for sustaining projects of $18 and excludes finance lease payments for development projects of $3.

(9)

Per ounce measures may not recalculate due to rounding.

(10)

Gold equivalent ounces is calculated as pounds or ounces produced multiplied by the ratio of the other metals price to the gold price, using Gold ($1,200/oz.), Copper ($2.75/lb.), Silver ($15/oz.), Lead ($0.90/lb.), and Zinc ($1.05/lb.) pricing.

 

 

 

 

 

 

 

Advanced

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Projects,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and

 

 

 

 

 

Treatment

 

 

 

 

 

 

 

All-In

 

 

Costs

 

 

 

Development

 

General

 

Other

 

and

 

 

 

All-In

 

 

 

Sustaining

Three Months Ended

 

Applicable

 

Reclamation

 

and

 

and

 

Expense,

 

Refining

 

Sustaining

 

Sustaining

 

Ounces (000)

 

Costs per

September 30, 2018

 

to Sales (1)(2)(3)

 

Costs (4)

 

Exploration(5)

 

Administrative

 

Net (6)

 

Costs

 

Capital (7)

 

Costs

 

Sold

 

oz. (8)

Gold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CC&V

 

$

68

 

$

 

$

3

 

$

1

 

$

 

$

 

$

6

 

$

78

 

82

 

$

927

Other North America

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

 

68

 

 

 

 

3

 

 

1

 

 

 

 

 

 

6

 

 

78

 

82

 

 

927

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yanacocha

 

 

116

 

 

15

 

 

2

 

 

1

 

 

 

 

 

 

14

 

 

148

 

156

 

 

945

Merian

 

 

67

 

 

 

 

1

 

 

1

 

 

3

 

 

 

 

12

 

 

84

 

131

 

 

631

Other South America

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

2

 

 

 

South America

 

 

183

 

 

15

 

 

3

 

 

4

 

 

3

 

 

 

 

26

 

 

234

 

287

 

 

822

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Boddington

 

 

146

 

 

2

 

 

 

 

 

 

 

 

6

 

 

12

 

 

166

 

198

 

 

838

Tanami

 

 

71

 

 

1

 

 

1

 

 

 

 

 

 

 

 

16

 

 

89

 

122

 

 

736

Kalgoorlie

 

 

56

 

 

1

 

 

1

 

 

 

 

 

 

 

 

4

 

 

62

 

77

 

 

804

Other Australia

 

 

 

 

 

 

3

 

 

1

 

 

 

 

 

 

1

 

 

5

 

 

 

Australia

 

 

273

 

 

4

 

 

5

 

 

1

 

 

 

 

6

 

 

33

 

 

322

 

397

 

 

811

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ahafo

 

 

62

 

 

1

 

 

1

 

 

 

 

1

 

 

 

 

14

 

 

79

 

102

 

 

770

Akyem

 

 

44

 

 

5

 

 

 

 

1

 

 

 

 

 

 

11

 

 

61

 

107

 

 

574

Other Africa

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

2

 

 

 

Africa

 

 

106

 

 

6

 

 

1

 

 

3

 

 

1

 

 

 

 

25

 

 

142

 

209

 

 

679

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Carlin

 

 

183

 

 

1

 

 

5

 

 

2

 

 

 

 

 

 

46

 

 

237

 

229

 

 

1,035

Phoenix

 

 

39

 

 

5

 

 

1

 

 

 

 

 

 

1

 

 

5

 

 

51

 

39

 

 

1,306

Twin Creeks

 

 

57

 

 

1

 

 

4

 

 

 

 

 

 

 

 

11

 

 

73

 

92

 

 

787

Long Canyon

 

 

21

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

25

 

43

 

 

577

Other Nevada

 

 

 

 

 

 

1

 

 

 

 

 

 

 

 

3

 

 

4

 

 

 

Nevada

 

 

300

 

 

7

 

 

11

 

 

2

 

 

 

 

1

 

 

69

 

 

390

 

403

 

 

969

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and Other

 

 

 

 

 

 

16

 

 

48

 

 

 

 

 

 

2

 

 

66

 

 

 

Total Gold

 

$

930

 

$

32

 

$

39

 

$

59

 

$

4

 

$

7

 

$

161

 

$

1,232

 

1,378

 

$

895

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gold equivalent ounces - other metals (9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Boddington

 

$

33

 

$

 

$

 

$

 

$

 

$

4

 

$

2

 

$

39

 

47

 

$

803

Phoenix

 

 

10

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

14

 

13

 

 

1,114

Total Gold Equivalent Ounces

 

$

43

 

$

 

$

 

$

 

$

 

$

4

 

$

6

 

$

53

 

60

 

$

867

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

$

973

 

$

32

 

$

39

 

$

59

 

$

4

 

$

11

 

$

167

 

$

1,285

 

 

 

 

 

(1)

Excludes Depreciation and amortization and Reclamation and remediation.

(2)

Includes by-product credits of $11 and excludes co-product revenues of $70.

(3)

Includes stockpile and leach pad inventory adjustments of $5 at CC&V, $10 at Yanacocha, $18 at Carlin, and $4 at Twin Creeks. Total stockpile and leach pad inventory adjustments at Carlin of $40 were adjusted above by $22 related to the write-down at Emigrant due to a change in mine plan, resulting in a significant decrease in mine life in the third quarter of 2018.

(4)

Reclamation costs include operating accretion and amortization of asset retirement costs of $17 and $15, respectively, and exclude non-operating accretion and reclamation and remediation adjustments of $11 and $3, respectively.

(5)

Advanced projects, research and development and Exploration excludes development expenditures of $1 at CC&V, $8 at Yanacocha, $1 at Merian, $9 at Other South America, $1 at Tanami, $1 at Kalgoorlie, $1 at Other Australia, $3 at Ahafo, $4 at Akyem, $1 at Other Africa, $3 at Carlin, $7 at Long Canyon, $5 at Other Nevada, and $1 at Corporate and Other, totaling $46 related to developing new operations or major projects at existing operations where these projects will materially benefit the operation.

(6)

Other expense, net is adjusted for restructuring and other costs of $1.

(7)

Excludes development capital expenditures, capitalized interest and the increase in accrued capital totaling $107. The following are major development projects: Quecher Main, Tanami Expansion 2, Ahafo North, Subika Underground, Ahafo Mill Expansion and Twin Creeks Underground.

(8)

Per ounce measures may not recalculate due to rounding.

(9)

Gold equivalent ounces is calculated as pounds or ounces produced multiplied by the ratio of the other metals price to the gold price, using Gold ($1,250/oz.) and Copper ($2.70/lb.) pricing.

 

 

 

 

 

 

 

 

Advanced

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Projects,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and

 

 

 

 

 

Treatment

 

Sustaining

 

 

 

 

 

All-In

 

 

Costs

 

 

 

 

Development

 

General

 

Other

 

and

 

Capital and

 

All-In

 

 

 

Sustaining

Nine Months Ended

 

Applicable

 

Reclamation

 

and

 

and

 

Expense,

 

Refining

 

Finance Lease

 

Sustaining

 

Ounces (000)

 

Costs per

September 30, 2019

 

to Sales (1)(2)(3)

 

Costs (4)

 

Exploration(5)

 

Administrative

 

Net (6)

 

Costs

 

Payments (7)(8)

 

Costs

 

Sold

 

oz. (9)

Gold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CC&V

 

$

208

 

$

3

 

$

6

 

$

1

 

$

2

 

$

 

$

28

 

$

248

 

230

 

$

1,076

Red Lake

 

 

88

 

 

2

 

 

5

 

 

 

 

 

 

 

 

22

 

 

117

 

68

 

 

1,734

Musselwhite

 

 

20

 

 

1

 

 

5

 

 

 

 

 

 

 

 

14

 

 

40

 

6

 

 

7,131

Porcupine

 

 

125

 

 

2

 

 

2

 

 

 

 

 

 

 

 

18

 

 

147

 

143

 

 

1,027

Éléonore

 

 

144

 

 

 

 

2

 

 

 

 

 

 

1

 

 

21

 

 

168

 

167

 

 

1,002

Peñasquito

 

 

66

 

 

1

 

 

 

 

 

 

 

 

1

 

 

25

 

 

93

 

54

 

 

1,714

Other North America

 

 

 

 

 

 

1

 

 

43

 

 

1

 

 

 

 

4

 

 

49

 

 

 

North America

 

 

651

 

 

9

 

 

21

 

 

44

 

 

3

 

 

2

 

 

132

 

 

862

 

668

 

 

1,290

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yanacocha

 

 

300

 

 

43

 

 

7

 

 

1

 

 

7

 

 

 

 

20

 

 

378

 

422

 

 

895

Merian

 

 

220

 

 

3

 

 

4

 

 

1

 

 

 

 

 

 

39

 

 

267

 

397

 

 

672

Cerro Negro

 

 

141

 

 

1

 

 

13

 

 

 

 

1

 

 

 

 

25

 

 

181

 

218

 

 

833

Other South America

 

 

 

 

 

 

 

 

7

 

 

 

 

 

 

 

 

7

 

 

 

South America

 

 

661

 

 

47

 

 

24

 

 

9

 

 

8

 

 

 

 

84

 

 

833

 

1,037

 

 

803

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Boddington

 

 

431

 

 

9

 

 

1

 

 

 

 

 

 

10

 

 

45

 

 

496

 

522

 

 

949

Tanami

 

 

198

 

 

2

 

 

5

 

 

 

 

 

 

 

 

56

 

 

261

 

361

 

 

725

Kalgoorlie

 

 

160

 

 

3

 

 

2

 

 

 

 

 

 

 

 

20

 

 

185

 

170

 

 

1,090

Other Australia

 

 

 

 

 

 

4

 

 

7

 

 

1

 

 

 

 

5

 

 

17

 

 

 

Australia

 

 

789

 

 

14

 

 

12

 

 

7

 

 

1

 

 

10

 

 

126

 

 

959

 

1,053

 

 

911

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ahafo

 

 

281

 

 

3

 

 

14

 

 

 

 

1

 

 

 

 

71

 

 

370

 

451

 

 

820

Akyem

 

 

172

 

 

25

 

 

3

 

 

 

 

1

 

 

 

 

20

 

 

221

 

321

 

 

691

Other Africa

 

 

 

 

 

 

 

 

7

 

 

1

 

 

 

 

 

 

8

 

 

 

Africa

 

 

453

 

 

28

 

 

17

 

 

7

 

 

3

 

 

 

 

91

 

 

599

 

772

 

 

776

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nevada Gold Mines

 

 

235

 

 

10

 

 

5

 

 

3

 

 

2

 

 

2

 

 

50

 

 

307

 

334

 

 

920

Carlin

 

 

358

 

 

3

 

 

9

 

 

3

 

 

1

 

 

 

 

64

 

 

438

 

408

 

 

1,076

Phoenix

 

 

116

 

 

3

 

 

 

 

1

 

 

 

 

7

 

 

10

 

 

137

 

118

 

 

1,149

Twin Creeks

 

 

113

 

 

1

 

 

3

 

 

1

 

 

 

 

 

 

23

 

 

141

 

170

 

 

830

Long Canyon

 

 

36

 

 

1

 

 

 

 

1

 

 

 

 

 

 

7

 

 

45

 

96

 

 

466

Other Nevada

 

 

 

 

 

 

5

 

 

 

 

 

 

 

 

4

 

 

9

 

 

 

Nevada

 

 

858

 

 

18

 

 

22

 

 

9

 

 

3

 

 

9

 

 

158

 

 

1,077

 

1,126

 

 

956

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and Other

 

 

 

 

 

 

46

 

 

148

 

 

3

 

 

 

 

9

 

 

206

 

 

 

Total Gold

 

$

3,412

 

$

116

 

$

142

 

$

224

 

$

21

 

$

21

 

$

600

 

$

4,536

 

4,656

 

$

974

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gold equivalent ounces - other metals (10)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Peñasquito

 

$

209

 

$

3