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Newmont Mining Corp. posted a sharply higher second-quarter profit Thursday, with record-high gold prices and production gains pumping revenue past most analysts' expectations.
Newmont (NEM:Newmont Mining Corporation
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Last: 49.02+0.25+0.51%
2:30pm 07/25/2008
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NEM 49.02, +0.25, +0.5%) shares rose $1.82, or 3.9%, to close at $48.77. The stock is up 12% over the past 12 months.
Newmont reported net income for the three months ended June 30 swung to $277 million, or 61 cents a share, from a year-ago loss of $2.06 billion, or $4.57 a share. The year-ago numbers were heavily skewed by a $1.67 billion write-down tied to the company's exit from merchant banking and a $460 million charge for settling price-capped forwards contracts.
Adjusted earnings from ongoing operations more than doubled to $230 million, or 51 cents a share, from $103 million, or 23 cents, a year earlier.
Gold sales during the quarter totaled 1.27 million equity ounces, fetching on average $900 an ounce, as the precious metal rode a huge spike in commodity prices. Gold prices were averaging about $600 an ounce a year ago.
Costs per ounce rose, however, to $440 an ounce from $417 a year ago.
Copper sales accounted for $183 million during the quarter, down from $340 million a year earlier.
Newmont stood by its earlier 2008 production forecast of 5.1 million to 5.4 million ounces of gold, with production cost expected to range from $425 to $450 per ounce.
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