Gold miner Newmont misses profit estimates, Penasquito return underway
Reuters
Published Oct 26, 2023 07:05AM ET
Updated Oct 26, 2023 01:22PM ET
By Seher Dareen
(Reuters) -Newmont on Thursday missed Wall Street estimates for third-quarter profit as the world's largest gold miner struggled with weak production stemming from a labor strike at its Mexico mine.
The company was forced to suspend operations at the Penasquito mine in Mexico in June, but it reached a resolution with the workers union earlier this month and expects to return to full productivity in the next two to three weeks.
The strike impact sent Newmont's quarterly attributable gold production down 13.4% to 1.29 million ounces.
Shares of the miner still rose nearly 3.1% to $37.9, with some analysts pointing to upcoming benefits from Newmont's deal to buy Australia's Newcrest for A$26.2 billion.
"Newmont's operations are poised to improve starting in the fourth quarter ... we anticipate significant synergies and per-share accretion (on the Newcrest deal)," said Matthew Miller, senior equity analyst at CFRA Research.
The miner lowered its 2023 gold production forecast to 5.3 million ounces from 5.7-6.3 million ounces in the previous quarter.
Newmont stock dropped on Wednesday, partly due to fears of a forecast cut, and with that negative catalyst out of the way, the market seems relieved, said Daniel Morgan, an analyst at Barrenjoey in Sydney.
On an adjusted basis, the company posted net income of 36 cents per share for the July-September quarter, compared with the analysts' average estimate of 43 cents, according to LSEG data.
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Written By: Reuters
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