Exhibit 99.1
Newmont Mining Announces Third Quarter Net Income of $114.4 Million ($0.28 per
share) and Nine Month Net Income of $322.5 Million ($0.80 per share, basic)
DENVER, Oct. 29 /PRNewswire-FirstCall/ -- Newmont Mining Corporation (the
Company) (NYSE: NEM) today announced third quarter net income applicable to
common shares of $114.4 million ($0.28 per share), a 450% increase from the
net income of $20.8 million ($0.05 per share) for the third quarter of 2002.
Newmont earned net income of $322.5 million ($0.80 per share, basic) for the
nine months ended September 30, 2003, a 307% increase from the $79.2 million
($0.22 per share) for the year-ago period. Third quarter highlights include:
* Equity gold sales(1) of 2.06 million ounces at total cash costs of
$201 per ounce;(2)
* Net cash provided by operating activities of $209.5 million; and
* Net debt to total capitalization reduced to approximately 13%, with
cash and cash equivalents of $419.4 million at the end of the third
quarter.
Wayne W. Murdy, Chairman and Chief Executive Officer of Newmont, said:
"Newmont's outstanding third quarter results are further evidence of the
strength of our portfolio of core operating assets. Higher gold prices and
significantly higher margins are being reflected in strong bottom-line
earnings per share growth. For the full year, we expect to be at the higher
end of our previous gold sales forecast of between 7.2 million and 7.4 million
ounces."
Third Quarter Nine Months
2003 2002 2003 2002
Financial (in
millions, except
per share)
Revenues $897.0 $720.1 $2,392.7 $1,859.1
Net cash provided
by operating
activities $209.5 $247.1 $434.4 $445.1
Net income applicable
to common shares $114.4 $20.8 $322.5 $79.2
Net income per
common share, basic $0.28 $0.05 $0.80 $0.22
Operating
Equity gold
sales (000
ounces)(1) 2,064 2,088 5,669 5,416
Average realized
price ($/oz) $366 $315 $357 $308
Total cash costs
($/oz)(2) $201 $189 $205 $193
Total production
costs ($/oz)(2) $265 $247 $268 $252
1. Equity gold sales ounces are those attributable to Newmont's
ownership or economic interest.
2. For a reconciliation of total cash costs and total production costs
per ounce (non-GAAP measures of performance) to costs applicable to
sales calculated and presented under GAAP, please refer to the
Supplemental Information attached.
Financial & Operating Review
Third quarter net income applicable to common shares was $114.4 million
($0.28 per share), compared with net income of $20.8 million ($0.05 per share)
for the third quarter of 2002. For the first nine months, net income
applicable to common shares was $322.5 million ($0.80 per share, basic)
compared with net income of $79.2 million ($0.22 per share) for the first nine
months of 2002.
During the third quarter, the Company sold 2,064,100 equity ounces of
gold, essentially unchanged from the 2,088,000 equity ounces sold a year ago.
The quarter saw strong performance at the Company's core operations in Nevada,
Australia, Yanacocha and Batu Hijau. In particular, Yanacocha had an
exceptional quarter with equity gold sales of 451,200 ounces, a 37% increase
over the year ago quarter, at total cash costs of $113 per ounce. At Batu
Hijau, net cash costs were $0.10 per pound, a record low, as higher ore grades
were processed (due to the planned mining sequence) and higher gold by-product
credits were received. The average realized gold price for the third quarter
was $366 per ounce, a 16% increase over the prior year period.
During the first nine months, the Company sold 5,668,500 equity ounces of
gold, 5% higher than the prior year period. The increase in ounces sold
largely reflects the February 15, 2002 acquisition date of Franco-Nevada and
Normandy Mining, as well as higher gold sales from Yanacocha. The average
realized gold price for the first nine months was $357 per ounce, a 16%
increase over the prior year period.
The Company generated cash from operating activities of $209.5 million in
the third quarter. For the first nine months, cash from operating activities
totaled $555.4 million, before utilizing $121.0 million for the settlement of
effective derivative instruments classified as cash flow hedges.
The following items impacted net income for the third quarter of 2003:
-- a net $13.6 million ($0.03 per share) after-tax loss on investments,
primarily related to the sale of 28 million shares of Kinross Gold;
-- a $32.8 million ($0.08 per share), after-tax loss for the change in
fair value of gold derivative instruments that do not qualify as
_effective hedges_ and are thus recognized in income;
-- a $14.5 million ($0.04 per share) after-tax gain on the extinguishment
of Newmont Yandal Operations Pty Ltd (NYOL) bonds;
-- a $20.9 million ($0.05 per share) after-tax gain on the
extinguishment of NYOL derivative liabilities; and
-- other miscellaneous charges totaling $3.0 million, after-tax ($0.01
per share).
These items had the net effect of reducing net income by $14.0 million
($0.03 per share).
Operating Highlights - Third Quarter
North America Q3 2003 Q3 2002 YTD 2003 YTD 2002
Equity gold sales
(000 ozs) 786.2 836.4 2,170.7 2,292.0
Total cash costs
($/oz)(1) $239 $222 $238 $228
* At the North American operations, third quarter gold sales of 786,200
ounces were 6% lower than the year ago quarter due to marginally lower
gold sales from Nevada and a 25% decline in gold sales from the
Canadian operations.
* The Nevada operations sold 696,900 ounces in the third quarter, a 3%
decrease from the third quarter of 2002. Total cash costs of $240 per
ounce were 7% higher than a year ago, primarily attributable to higher
reagent costs and contractor costs, as well as higher cost production
from the Deep Post underground mine due to the ongoing ground
remediation efforts. Recoveries at the roaster and autoclaves were
excellent, averaging 91% in the third quarter compared to 86% in the
year ago quarter.
* Golden Giant in Canada sold 42,800 ounces in the third quarter (-29%)
as a result of fewer ore stopes. Total cash costs were 10% higher than
a year ago at $238 per ounce due to a stronger Canadian dollar and a
41% decline in tons milled, partially offset by a 55% improvement in
ore grades processed.
* Holloway in Canada sold 17,400 equity ounces in the third quarter
(-13%) due to an expected decline in ore grades (-20%). Total cash
costs of $297 per ounce were 84% higher than a year ago. Cash costs
were impacted by a stronger Canadian dollar, a 13% decrease in tons
mined and lower sales due to lower ore grades processed.
* La Herradura in Mexico sold 16,500 equity ounces in the third quarter
(-7%) due to slower than anticipated leach recoveries. Total cash
costs of $181 per ounce were 7% higher than a year ago due to lower
gold sales.
* Mesquite in California sold 12,600 ounces at total cash costs of $196
per ounce. An agreement to sell the Mesquite operations to Western
Goldfields was entered into in July 2003 and this transaction is now
expected to close in November.
South America Q3 2003 Q3 2002 YTD 2003 YTD 2002
Equity gold sales
(000 ozs) 495.0 394.5 1,274.5 1,015.0
Total cash costs
($/oz)(1) $121 $124 $125 $135
* Yanacocha in Peru had an exceptional quarter, selling a record 451,200
equity ounces (+37%) at total cash costs of $113 per ounce (-5%).
Higher grade ores (+18%), quicker leach recoveries from the recently
completed Carachugo leach pad expansion and the installation of
additional carbon columns contributed to record gold sales in the third
quarter. Equity gold sales are, however, likely to be lower in the
fourth quarter.
* Kori Kollo in Bolivia sold 43,800 equity ounces (-33%) as the mine
approaches closure. Kori Kollo processed lower grade ores (-19%) and
mined 71% less tons compared to the year ago quarter. As a result,
total cash costs at $199 per ounce were 31% higher than a year ago.
Australia Q3 2003 Q3 2002 YTD 2003 YTD 2002
Equity gold sales
(000 ozs) 511.8 475.3 1,450.2 1,171.6
Total cash costs
($/oz)(1) $235 $201 $237 $192
* At the Australian operations, third quarter gold sales of 511,800
ounces were up 8% from the year ago quarter, with increased sales at
Kalgoorlie, Pajingo and Tanami. Cash costs at $235 per ounce were up
17%, largely due to the impact of a stronger Australian dollar, which
has risen approximately 25% against the U.S. dollar over the past 12
months.
* Kalgoorlie sold 116,000 equity ounces (+23%) at total cash costs of
$266 per ounce (+19%). Higher average ore grades (+12%), increased
mill throughput (+11%) and improved recoveries helped mitigate the
impact of a stronger Australian dollar.
* Pajingo sold 90,900 ounces (+18%) at total cash costs of $128 per ounce
(+31%). Higher sales were driven by higher mill throughput (+4%) and
improved ore grades (+27%). Higher cash costs are attributable to a
stronger Australian dollar and increased royalty payments.
* Tanami sold 153,100 ounces (+15%) at total cash costs of $241 per ounce
(+17%). Higher cash costs were primarily attributable to a stronger
Australian dollar.
* Yandal sold 151,800 ounces (-11%) at total cash costs of $269 per ounce
(+16%). Lower sales were primarily the result of lower grade ores
milled at the Bronzewing mine (-21%). Bronzewing is expected to
complete mining at the end of the first quarter of 2004.
Batu Hijau
(Indonesia) Q3 2003 Q3 2002 YTD 2003 YTD 2002
Equity copper
sales (M lbs) 103.2 114.5 264.3 271.4
Equity gold
sales (000 ozs) 116.5 96.9 262.7 200.2
Net cash costs
($/lb Cu)(1) $0.10 $0.24 $0.19 $0.31
* Batu Hijau in Indonesia had an exceptional quarter. Net cash costs for
the third quarter were a record $0.10 per pound, a 58% reduction from
the year ago quarter, driven by significantly higher ore grades, higher
gold by-product credits and lower treatment and refining charges.
Higher ore grades in the third quarter are generally a function of the
long-term mine plan, which accesses higher grade ores during the dry
season.
* Equity copper sales of 103.2 million pounds for the third quarter were
10% lower than the year ago quarter as tons processed decreased by 15%
compared to the year ago quarter when softer ores were processed.
* Batu Hijau contributed equity income of $36.0 million in the third
quarter, benefiting from a 36% higher realized copper price of $0.84
per pound, compared to $0.62 for the year ago quarter.
Other Operations Q3 2003 Q3 2002 YTD 2003 YTD 2002
Equity gold
sales (000 ozs) 151.0 162.9 464.3 467.0
Total cash
costs ($/oz)(1) $160 $149 $168 $151
* Zarafshan in Uzbekistan sold 50,200 equity ounces (-29%) at total cash
costs of $153 per ounce (+25%). Decreased sales and higher unit cash
costs were due to lower grade ores placed on the leach pads (-24%).
* Ovacik in Turkey sold 51,500 ounces (+41%) due to increased throughput
(+45%) as tons mined increased (+66%) due to a pit extension. Total
cash costs were slightly higher than the year ago quarter at $128 per
ounce (+4%).
* Martha in New Zealand sold 26,200 equity ounces (-5%) at total cash
costs of $217 per ounce (+57%). Lower sales were driven by lower
grade ores processed (-27%). Higher total cash costs were driven by
mill liner replacement costs, higher power and consumables as well as a
stronger New Zealand dollar.
* Minahasa in Indonesia sold 23,100 equity ounces (-18%). While mining
ceased at Minahasa in October 2001, the processing of stockpiled ore is
expected to continue through the second quarter of 2004. Total cash
costs were $182 per ounce (-30%).
1. For a reconciliation of total cash costs per ounce or net cash costs
per pound (non-GAAP measures of performance) to costs applicable to
sales calculated and presented under GAAP, please refer to the
Supplemental Information attached.
Other Highlights
Cash Position
Cash and cash equivalents totaled $419.4 million at the end of the third
quarter. During the third quarter, cash flow from operations plus the cash
generated from the sale of Kinross Gold shares was utilized for:
-- the extinguishment of the remaining NYOL derivative obligations ($26.2
million);
-- net repayment of long-term debt ($138.7 million);
-- capital expenditures on property, plant and mine development ($151.1
million); and
-- payment of dividends ($16.4 million).
Debt Reduction
The Company's balance sheet continues to strengthen, with net repayment of
$138.7 million of long-term debt during the quarter. The net debt to total
capitalization ratio decreased to approximately 13% at the end of the third
quarter, from 16% at the end of the second quarter and 20% at the end of 2002.
On September 22, the Company announced the early redemption of the $100
million Battle Mountain Gold 6% Convertible Subordinated Debentures. Payment
of approximately $104.9 million in principal and accrued interest will be made
to bondholders on October 29.
On October 10, the Company announced a tender offer for approximately $177
million of a subsidiary's 8.375% Senior Debentures due 2005. As of October
27, approximately $123.5 million had been irrevocably tendered. The offer is
scheduled to expire on November 7, 2003, unless extended.
On October 23, the Company announced a tender offer for $90 million of a
subsidiary's 7.5% Notes due 2005. The offer is scheduled to expire on
November 19, 2003, unless extended.
Australian Gold Hedge Books
The Company substantially eliminated the Australian gold hedge books
during the quarter. Committed ounces were reduced by 195,000 ounces through
the resolution of the NYOL insolvency process in Australia. NYOL was returned
to the control of its Board of Directors on September 9.
Newmont Capital
Portfolio optimization efforts continue. During the quarter, Newmont
Capital:
-- reduced the Company's interest in Kinross Gold to approximately 4.9%
through the sale of 28 million Kinross Gold shares, realizing pre-tax
proceeds of $224.6 million;
-- finalized a letter of intent with a subsidiary of Placer Dome America
for a 25% interest in the Turquoise Ridge Joint Venture, as announced
on September 24;
-- advanced the acquisition of Moydow's 50% interest in the Ntotoroso
property in the Ahafo project in Ghana;
-- sold the Company's 24% stake in the Mt. Woods joint venture in
Southern Australia for approximately 13% of Minotaur Resources Ltd.;
-- secured a letter of intent with Southwestern Resources for a potential
joint venture covering its Liam gold-silver project in south-central
Peru. In addition, subscribed to a $5.0 million private placement in
Southwestern Resources;
-- entered into joint ventures with Adelaide Resources in South
Australia, Andean American Mining in central Peru and with AXMIN in
Mali; and
-- obtained an agreement for the sale of Yandal's Wiluna mine to a
management-led group of investors for approximately $2.8 million.
Newmont Capital also manages the Company's royalty business. For the
quarter, royalty revenues totaled $15.8 million, compared with $7.9 million
for the year ago quarter. For the nine months, royalty revenues totaled $40.8
million, significantly higher than the $22.9 million for the first nine months
of 2002. The increase is attributable to higher gold, oil and gas prices and
a full year of revenues in 2003 compared to a partial year in 2002 due to the
February 15, 2002 acquisition date of Franco-Nevada.
Exploration & Project Development
On September 24, the Company provided updated information on a number of
projects that, if developed as currently anticipated, will increase annual
gold sales from between 7.3 million and 7.4 million ounces in 2003 to
approximately 7.7 million ounces in 2007. In addition, total cash costs are
expected to decrease from the current 2003 forecast of between $202 and $208
per ounce to between $175 and $190 per ounce in 2007.
In Nevada, gold production commenced at the Gold Quarry South Layback in
Nevada. The Leeville project is proceeding well with surface facilities
essentially complete. The sinking of the ventilation and production shafts is
continuing on schedule. Leeville is expected to begin gold production in the
fourth quarter of 2005. Engineering work for a bio-flotation circuit for Mill
5 is underway with an expected start-up in the fourth quarter of 2004. The
Company expects bio-flotation, an $18 million capital investment, to increase
the bio-milling process recovery rate from 55% to approximately 75% and, more
importantly, to provide an economic process to treat mid-grade refractory
material that would otherwise have been considered waste. At Twin Creeks,
stripping commenced at the Section 30 Layback (south Mega Pit) in August.
Gold production is expected in 2005.
At the end of the third quarter, Newmont had 64 drill rigs operating
around the world. Exploration highlights during the quarter include
continuing positive results in Nevada and at the Ahafo and Akyem projects in
Ghana.
In Nevada, exploration and development drilling results continue to
indicate excellent reserve addition potential at Gold Quarry and the Twin
Creeks Sage Layback (north Mega Pit). At Midas, drilling continues to define
a new vein of high grade gold mineralization discovered at a lower elevation
than the main Midas veins.
In Ghana, positive drill results across the trend at Ahafo and at the open
pit at Akyem provide confidence that the Company will more than double
existing reserves to 10 million equity ounces by year-end. The Company
continues to update the feasibility studies for Ahafo and Akyem and expects to
complete the Ahafo feasibility study update in November. Pending finalization
of an acceptable foreign investment contract with the Ghanaian government, a
development decision for the projects is expected by year-end 2003.
Updated 2003 Forecast
The Company has updated its 2003 Forecast (refer to Page 12 of 26). In
summary, equity gold sales are projected to be between 7.3 million and 7.4
million ounces at total cash costs of between $202 and $208 per ounce.
Changes to the previous forecast include:
-- in Nevada, an expected $4 increase in total cash costs to $232 per
ounce, largely reflecting the impact of the ground remediation efforts
at Deep Post;
-- at Yanacocha, a 7% increase in ounces sold to 1.47 million equity
ounces, at slightly higher total cash costs of $120 per ounce;
-- in Australia, marginally lower total cash costs of approximately $241
per ounce, at essentially unchanged forecasted sales of 1.9 million
ounces; and
-- at Batu Hijau, an expected 15% decrease in net cash costs of between
$0.22 and $0.24 per pound. Forecasted copper sales are now between
340 million and 350 million equity pounds and equity gold sales
increased from 290,000 ounces to 315,000 ounces.
Statements of Consolidated Operations
Three Months Ended September 30,
2003 2002
(unaudited, in thousands,
except per share)
Revenues
Sales - gold $870,949 $697,829
Sales - base metals, net 10,211 14,339
Royalties 15,832 7,900
896,992 720,068
Costs and expenses
Costs applicable to sales
(exclusive of depreciation, depletion
and amortization shown separately below)
Gold 457,983 431,756
Base metals 4,881 10,611
Depreciation, depletion and amortization 151,443 133,649
Exploration, research and development 30,646 25,356
General and administrative 28,954 29,742
Write-down of long-lived assets 3,582 283
Other 5,498 6,756
682,987 638,153
Other income (expense)
Loss on investments, net (3,322) --
Loss on gold commodity derivative
instruments, net (46,927) (11,191)
Gain on extinguishment of NYOL bonds, net 19,617 --
Gain on extinguishment of NYOL derivatives
liability, net 29,928 --
Dividends, interest income, foreign
currency exchange and other income 22,376 7,926
Interest expense, net (18,756) (33,082)
2,916 (36,347)
Pre-tax income before minority interest,
equity (loss) income and impairment
of affiliates 216,921 45,568
Income tax expense (80,977) (10,756)
Minority interest in income of subsidiaries (57,125) (32,495)
Equity loss and impairment of
Australian Magnesium Corporation (574) (486)
Equity income of affiliates 36,189 18,929
Net income applicable to common shares $114,434 $20,760
Net income $114,434 $20,760
Other comprehensive income, net of tax 33,013 (75,443)
Comprehensive income $147,447 $(54,683)
Net income per common share, basic and diluted $0.28 $0.05
Basic weighted average common
shares outstanding 408,379 401,422
Diluted weighted average common
shares outstanding 412,922 402,960
Cash dividends declared per common share $0.04 $0.03
Statements of Consolidated Operations
Nine Months Ended September 30,
2003 2002
(unaudited, in thousands,
except per share)
Revenues
Sales - gold $2,309,531 $1,789,579
Sales - base metals, net 42,379 46,644
Royalties 40,773 22,902
2,392,683 1,859,125
Costs and expenses
Costs applicable to sales (exclusive of
depreciation, depletion and amortization
shown separately below)
Gold 1,280,692 1,143,806
Base metals 30,216 29,990
Depreciation, depletion and amortization 421,373 359,437
Exploration, research and development 82,365 55,711
General and administrative 86,656 78,709
Write-down of long-lived assets 5,376 283
Other 29,836 6,165
1,936,514 1,674,101
Other income (expense)
Gain on investments, net 81,393 47,298
Gain (loss) on gold commodity
derivative instruments, net 24,742 (14,338)
Gain on extinguishment of NYOL bonds, net 114,031 --
Gain on extinguishment of NYOL
derivatives liability, net 106,506 --
Loss on extinguishment of debt (19,530) --
Dividends, interest income, foreign
currency exchange and other income 86,020 23,514
Interest expense, net (71,371) (99,320)
321,791 (42,846)
Pre-tax income before minority interest,
equity (loss) income and impairment of
affiliates and cumulative effect of a
change in accounting principle 777,960 142,178
Income tax expense (232,578) (41,765)
Minority interest in income of subsidiaries (130,721) (62,329)
Equity loss and impairment of
Australian Magnesium Corporation (120,059) (1,174)
Equity income of affiliates 62,467 38,341
Net income before cumulative effect
of a change in accounting principle 357,069 75,251
Cumulative effect of a change in
accounting principle, net of tax (34,533) 7,701
Net income 322,536 82,952
Preferred stock dividends -- (3,738)
Net income applicable to common shares $322,536 $79,214
Net income $322,536 $82,952
Other comprehensive income, net of tax 93,172 (17,737)
Comprehensive income $415,708 $65,215
Net income per common share before
cumulative effect of a change in
accounting principle, basic $0.88 $0.20
Cumulative effect of a change in
accounting principle per
common share, basic (0.08) 0.02
Net income per common share, basic $0.80 $0.22
Net income per common share before
cumulative effect of a change in
accounting principle, diluted $0.88 $0.20
Cumulative effect of a change in
accounting principle per
common share, diluted (0.09) 0.02
Net income per common share, diluted $0.79 $0.22
Basic weighted average common
shares outstanding 405,243 360,577
Diluted weighted average common
shares outstanding 407,941 362,023
Cash dividends declared per common share $0.12 $0.09
Consolidated Balance Sheets
September 30, 2003 December 31, 2002
(unaudited, in thousands)
ASSETS
Cash and cash equivalents $419,411 $401,683
Marketable securities 124,774 13,188
Accounts receivable 52,802 44,510
Inventories 178,076 169,324
Stockpiles and ore on leach pads 242,139 328,993
Prepaid taxes 21,281 28,335
Deferred stripping costs - short-term 49,871 32,085
Deferred income tax assets 54,286 51,451
Newmont Australia infrastructure bonds 116,415 --
Other current assets 66,103 43,687
Current assets 1,325,158 1,113,256
Property, plant and mine
development, net 2,378,020 2,287,030
Mineral interests and
other intangible assets, net 1,373,457 1,415,348
Investments 727,134 1,206,705
Deferred stripping costs - long-term 33,724 23,302
Long-term stockpiles and ore
on leach pads 297,069 199,761
Deferred income tax assets 887,994 761,428
Other long-term assets 95,457 123,112
Goodwill 3,037,201 3,024,576
Total assets $10,155,214 $10,154,518
LIABILITIES
Current portion of long-term debt $175,927 $115,322
Accounts payable 148,890 105,277
Deferred income tax liabilities 3,793 28,469
Derivative instruments 5,093 74,999
Employee related benefits - short-term 143,038 100,936
Other current liabilities 347,190 268,460
Current liabilities 823,931 693,463
Long-term debt 1,198,126 1,701,282
Reclamation and remediation
liabilities 418,340 288,536
Deferred revenue from sale
of future production 53,841 53,841
Derivative instruments 8,563 388,659
Deferred income tax liabilities 802,938 656,452
Employee related benefits - long-term 205,121 234,103
Other long-term liabilities 312,189 364,376
Total liabilities 3,823,049 4,380,712
Minority interest in subsidiaries 368,238 354,558
STOCKHOLDERS' EQUITY
Total stockholders' equity 5,963,927 5,419,248
Total liabilities and
stockholders' equity $10,155,214 $10,154,518
Statement of Consolidated Cash Flows
Three Months Ended
September 30,
2003 2002
(unaudited, in thousands)
Operating activities:
Net income $114,434 $20,760
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation, depletion
and amortization 151,443 133,649
Accretion of accumulated
reclamation obligations 5,799 --
Amortization of deferred
stripping costs, net (15,599) 19,856
Deferred income taxes 6,346 (16,282)
Foreign currency exchange gain (19,213) (20,494)
Minority interest,
net of dividends 6,042 31,195
Equity income of affiliates,
net of dividends (35,615) (12,683)
Write-downs of inventories,
stockpiles and ore on leach pads 2,492 21,711
Write-down of long-lived assets 5,376 283
Loss on investments, net 3,322 --
Loss on gold commodity
derivative instruments, net 46,927 11,191
Gain on extinguishment of
NYOL bonds, net (19,617) --
Gain on extinguishment of
NYOL derivatives liability, net (29,928) --
Gain on sale of assets and other (2,823) (10,549)
(Increase) decrease in
operating assets:
Accounts receivable (3,220) 3,352
Inventories, stockpiles
and ore on leach pads 6,450 (6,485)
Other assets (4,429) 34,132
Increase (decrease) in
operating liabilities:
Accounts payable and other
accrued liabilities 9,775 20,999
Derivative instruments (2,453) (29,242)
Early settlement of derivative
instruments classified
as cash flow hedges -- (1,168)
Other liabilities (16,042) 46,835
Net cash provided by
operating activities 209,467 247,060
Investing activities:
Additions to property, plant and
mine development (151,099) (97,361)
Advances to joint ventures and
affiliates, net 6,190 --
Proceeds from sale of investments 230,537 712
Early settlement of ineffective
derivative instruments (26,191) (11,857)
Cash consideration for
acquisition of Normandy and
Franco-Nevada, net of cash
received and transaction costs -- (229)
Proceeds from asset sales and other 625 10,428
Net cash (used in) provided by
investing activities 60,062 (98,307)
Financing activities:
Proceeds from long-term debt 377,478 4,240
Repayment of long-term debt (516,223) (115,041)
Dividends paid on common
and preferred stock (16,387) (12,060)
Proceeds from stock issuance
and other 29,997 5,066
Other -- 687
Net cash used in financing activities (125,135) (117,108)
Effect of exchange rate changes
on cash 276 (24,902)
Net change in cash and
cash equivalents 144,670 6,743
Cash and cash equivalents
at beginning of period 274,741 285,405
Cash and cash equivalents at
end of period $419,411 $292,148
Supplemental information:
Interest paid, net of amounts
capitalized $30,116 $33,956
Income taxes paid $34,690 $20,220
Statement of Consolidated Cash Flows
Nine Months Ended
September 30,
2003 2002
(unaudited, in thousands)
Operating activities:
Net income $322,536 $82,952
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation, depletion and amortization 421,373 359,437
Accretion of accumulated
reclamation obligations 17,119 --
Amortization of deferred stripping
costs, net (29,713) 28,759
Deferred income taxes 15,091 (26,685)
Foreign currency exchange gain (53,232) (9,990)
Minority interest, net of dividends 50,448 58,329
Equity loss (income) and impairment
of affiliates, net of dividends 63,694 (27,542)
Write-downs of inventories, stockpiles
and ore on leach pads 20,433 37,608
Write-down of long-lived assets 5,376 283
Cumulative effect of a change in
accounting principle, net of tax 34,533 (7,701)
Gain on investments, net (81,393) (47,298)
(Gain) loss on gold commodity
derivative instruments, net (24,742) 14,338
Gain on extinguishment of
NYOL bonds, net (114,031) --
Gain on extinguishment of
NYOL derivatives liability, net (106,506) --
Loss on extinguishment of debt 19,530 --
Gain on sale of assets and other (13,472) (20,253)
(Increase) decrease in operating assets:
Accounts receivable 4,780 17,765
Inventories, stockpiles and
ore on leach pads (19,124) (11,926)
Other assets 2,903 49,013
Increase (decrease) in operating
liabilities:
Accounts payable and other
accrued liabilities 63,931 (25,474)
Derivative instruments (15,388) (29,242)
Early settlement of derivative
instruments classified as
cash flow hedges (120,993) (1,168)
Other liabilities (28,740) 3,939
Net cash provided by operating activities 434,413 445,144
Investing activities:
Additions to property, plant and
mine development (366,400) (238,171)
Advances to joint ventures and
affiliates, net (40,013) (24,750)
Proceeds from sale of investments 232,190 491,445
Proceeds from the sale of
TVX Newmont Americas 180,000 --
Proceeds from sale of cross currency swaps -- 50,816
Early settlement of ineffective
derivative instruments (55,339) (11,857)
Cash consideration for acquisition
of Newmont NFM minority interest
and other acquisitions (11,195) --
Cash consideration for acquisition of
Normandy and Franco-Nevada, net of
cash received and transaction costs -- (88,114)
Proceeds from asset sales and other 1,613 30,316
Net cash (used in) provided by
investing activities (59,144) 209,685
Financing activities:
Proceeds from long-term debt 492,478 493,371
Repayment of long-term debt (838,583) (1,026,858)
Dividends paid on common and
preferred stock (48,695) (37,931)
Proceeds from stock issuance and other 54,848 67,964
Other -- (4)
Net cash used in financing activities (339,952) (503,458)
Effect of exchange rate changes on cash (17,589) (8,654)
Net change in cash and cash equivalents 17,728 142,717
Cash and cash equivalents at
beginning of period 401,683 149,431
Cash and cash equivalents at end of period $419,411 $292,148
Supplemental information:
Interest paid, net of amounts capitalized $97,413 $95,624
Income taxes paid $145,157 $65,920
Operating Statistics Summary
North America South America Australia
Three months ended
September 30, 2003 2002 2003 2002 2003 2002
Production Costs Per Ounce:
Direct mining and production
costs $254 $203 $120 $123 $228 $191
Capitalized mining & other (20) 12 (4) (3) (6) (1)
Cash operating costs 234 215 116 120 222 190
Royalties and production
taxes 5 7 5 4 13 11
Total cash costs(5) 239 222 121 124 235 201
Reclamation and mine closure
costs 4 2 3 5 2 4
Total costs applicable to
sales 243 224 124 129 237 205
Non-cash inventory adjustment -- -- -- -- -- --
Depreciation and amortization 57 49 58 42 61 50
Depreciation and amortization
adjustment -- -- -- -- -- 18
Total production costs(5) $300 $273 $182 $171 $298 $273
Consolidated gold sales (000
ozs.) 786.2 836.4 928.5 715.7 511.8 497.2
Equity gold sales (000 ozs.) 786.2 836.4 495.0 394.5 511.8 475.3
Average realized price per
equity ounce $362 $314 $364 $314 $365 $319
Equity
Other(1) Investments Total
and Other(2)(3)
Three months ended
September 30, 2003 2002 2003 2002 2003 2002
Production Costs Per Ounce:
Direct mining and
production costs $193 $155 -- -- $208 $179
Capitalized mining &
other (38) (9) -- -- (14) 4
Cash operating costs 155 146 -- -- 194 183
Royalties and production
taxes 5 3 -- -- 7 6
Total cash costs(5) 160 149 -- -- 201 189
Reclamation and mine
closure costs 2 5 -- -- 3 4
Total costs applicable to
sales 162 154 -- -- 204 193
Non-cash inventory
adjustment -- -- -- -- -- --
Depreciation and
amortization 82 48 -- -- 61 47
Depreciation and
amortization adjustment -- 24 -- -- -- 7
Total production costs(5) $244 $226 -- -- $265 $247
Consolidated gold sales (000
ozs.) 152.5 164.8 3.6 1.2 2,382.6 2,215.3
Equity gold sales (000 ozs.) 151.0 162.9 120.1 218.9 2,064.1 2,088.0
Average realized price per
equity ounce $364 $315 -- -- $366 $315
Copper Summary(4)
Equity copper production
(millions of lbs.) 125.5 138.6
Equity copper sales
(millions of lbs.) 112.0 127.1
Net cash cost per equity
pound $0.13 $0.25
Average realized price per
pound $0.84 $0.67
North America South America Australia
Nine Months ended
September 30, 2003 2002 2003 2002 2003 2002
Production Costs Per
Ounce:
Direct mining and
production costs $249 $215 $125 $134 $226 $180
Capitalized
mining & other (18) 8 (4) (2) (2) 2
Cash operating
costs 231 223 121 132 224 182
Royalties and
production taxes 7 5 4 3 13 10
Total cash costs(5) 238 228 125 135 237 192
Reclamation and
mine closure
costs 3 3 4 3 2 4
Total costs
applicable to sales 241 231 129 138 239 196
Non-cash
inventory
adjustment -- 1 -- -- -- 4
Depreciation and
amortization 61 48 59 55 58 48
Depreciation and
amortization
adjustment -- (1) -- -- -- 14
Total production
costs(5) $302 $279 $188 $193 $297 $262
Consolidated gold
sales (000 ozs.) 2,170.7 2,292.0 2,364.8 1,821.0 1,467.6 1,223.9
Equity gold sales
(000 ozs.) 2,170.7 2,292.0 1,274.5 1,015.0 1,450.2 1,171.6
Average realized
price per equity
ounce $353 $306 $355 $306 $354 $314
Equity
Other(1) Investments Total
and Other(2)(3)
Nine Months ended
September 30, 2003 2002 2003 2002 2003 2002
Production Costs Per Ounce:
Direct mining and
production costs $181 $156 -- -- $207 $185
Capitalized mining &
other (17) (8) -- -- (10) 2
Cash operating costs 164 148 -- -- 197 187
Royalties and production
taxes 4 3 -- -- 8 6
Total cash costs(5) 168 151 -- -- 205 193
Reclamation and mine
closure costs 2 2 -- -- 2 3
Total costs applicable to
sales 170 153 -- -- 207 196
Non-cash inventory
adjustment -- 2 -- -- -- 1
Depreciation and
amortization 71 51 -- -- 61 51
Depreciation and
amortization adjustment -- 19 -- -- -- 4
Total production costs(5) $241 $225 -- -- $268 $252
Consolidated gold sales (000
ozs.) 470.8 474.3 10.4 10.3 6,484.3 5,821.5
Equity gold sales (000 ozs.) 464.3 467.0 308.8 470.4 5,668.5 5,416.0
Average realized price per
equity ounce $355 $308 -- -- $357 $308
Copper Summary(4)
Equity copper production
(millions of lbs.) 321.6 327.2
Equity copper sales
(millions of lbs.) 310.5 309.1
Net cash cost per equity
pound $0.25 $0.34
Average realized price per
pound $0.80 $0.72
(1) Other includes Ovacik (Turkey), Zarafshan (Uzbekistan), Minahasa
(Indonesia) and Martha (New Zealand).
(2) Equity investments comprise Batu Hijau (and TVX Newmont Americas and
Echo Bay Mining Limited through January 31, 2003).
(3) Includes 10,400 and 10,300 ounces from the wholly-owned Golden Grove
zinc/copper mine in 2003 and 2002, respectively.
(4) Represents both Batu Hijau and Golden Grove
(5) For a reconciliation of total cash costs and total production costs
per ounce (non-GAAP measures of performance) to costs applicable to
sales calculated and presented under GAAP, please refer to the
Supplemental Information attached.
Updated 2003 Forecast
Equity Gold Total
Sales Cash Costs
(000 oz) ($/oz)
North America
Nevada 2,550 $232
Mesquite(1) 50 $144
Golden Giant 220 $233
Holloway 70 $286
La Herradura 70 $171
Sub-total 2,960 $230
South America
Yanacocha 1,465 $120
Kori Kollo 155 $183
Sub-total 1,620 $126
Australia
Kalgoorlie 400 $277
Pajingo 320 $130
Tanami(2) 600 $245
Yandal 575 $275
Sub-total 1,895 $241
Other
Martha(2) 90 $236
Zarafshan 220 $150
Minahasa 90 $238
Ovacik 160 $129
Sub-total 560 $172
Equity Investments
Batu Hijau 315 --
TOTAL 7,300 - 7,400 $202 - $208
Notes:
(1) Assumes sale to Western Goldfields is completed by November 2003.
(2) Effective April 2003, 100% interest.
Equity Copper & Zinc Sales Net Cash Costs
(million lbs) ($/lb)
Batu Hijau - Copper 340-350 $0.22-$0.24
Golden Grove - Copper 75-85 $0.63-$0.66
Golden Grove - Zinc 110-120 $0.20-$0.24
Financial Projections (in millions, except tax rate)
Royalty revenue $45-$50
Depreciation, depletion & amortization $550-$570
Exploration and research $100-$110
General and administrative $105-$110
Interest expense $90-$95
Tax rate (assuming $360/oz gold) ~30%
Capital expenditures $525-$550
Sensitivity to Changes in the Gold Price
An annualized $10 change in the gold price changes annual net income by
approximately $50 million, assuming all other factors remain constant.
An annualized $10 change in the gold price changes annual cash generated
by operating activities by approximately $56 million, assuming all other
factors remain constant.
Supplemental Information
1. Gold Production Summary - Americas
Nevada Canada Yanacocha, Peru
Three months ended
September 30, 2003 2002 2003 2002 2003 2002
Tons Mined (000 dry short
tons):
Open-Pit 43,475 35,808 n/a n/a 53,268 54,125
Underground 414 359 267 388 n/a n/a
Tons Milled/Processed (000):
Oxide 1,036 1,314 275 382 n/a n/a
Refractory 2,355 2,511 n/a n/a n/a n/a
Leach 5,016 3,822 n/a n/a 40,524 42,029
Average Ore Grade (oz/ton):
Oxide 0.116 0.131 0.259 0.214 n/a n/a
Refractory 0.221 0.222 n/a n/a n/a n/a
Leach 0.029 0.035 n/a n/a 0.027 0.023
Average Mill Recovery Rate:
Oxide 77.0% 76.2% 95.6% 94.7% n/a n/a
Refractory 91.3% 86.2% n/a n/a n/a n/a
Ounces Produced (000): 696.0 690.9 60.5 75.3 862.4 638.9
Equity Ounces Produced
(000):
Oxide 87.1 130.8 60.5 75.3 n/a n/a
Refractory 514.7 466.6 n/a n/a n/a n/a
Leach 94.2 93.5 n/a n/a 442.8 328.1
Total 696.0 690.9 60.5 75.3 442.8 328.1
Equity Ounces Sold (000) 696.9 722.0 60.2 80.4 451.2 329.6
Production Costs Per Ounce:
Direct mining and
production costs $258 $204 $244 $201 $111 $116
Capitalized mining &
other (22) 14 5 1 (3) (2)
Cash operating costs 236 218 249 202 108 114
Royalties and production
taxes 4 7 6 1 5 5
Total cash costs 240 225 255 203 113 119
Reclamation and mine
closure costs 3 2 9 6 2 4
Total costs applicable to
sales 243 227 264 209 115 123
Non-cash inventory
adjustment -- -- -- -- -- --
Depreciation and
amortization 55 46 81 65 60 41
Depreciation and
amortization adjustment -- -- -- -- -- --
Total production costs $298 $273 $345 $274 $175 $164
Kori Kollo,
Bolivia Other(1)
Three months ended September 30, 2003 2002 2003 2002
Tons Mined (000 dry short tons):
Open-Pit 1,425 4,894 3,042 2,918
Underground n/a n/a n/a n/a
Tons Milled/Processed (000):
Oxide n/a n/a n/a n/a
Refractory 1,764 1,952 n/a n/a
Leach 978 1,569 1,050 1,015
Average Ore Grade (oz/ton):
Oxide n/a n/a n/a n/a
Refractory 0.035 0.049 n/a n/a
Leach 0.018 0.019 0.026 0.027
Average Mill Recovery Rate:
Oxide n/a n/a n/a n/a
Refractory 60.9% 58.7% n/a n/a
Ounces Produced (000): 48.4 72.0 29.1 34.0
Equity Ounces Produced (000):
Oxide n/a n/a n/a n/a
Refractory 32.9 50.4 n/a n/a
Leach 9.7 13.0 29.1 34.0
Total 42.6 63.4 29.1 34.0
Equity Ounces Sold (000) 43.8 64.9 29.1 34.0
Production Costs Per Ounce:
Direct mining and production costs $216 $158 $183 $189
Capitalized mining & other (17) (6) (3) (5)
Cash operating costs 199 152 180 184
Royalties and production taxes -- -- 7 7
Total cash costs 199 152 187 191
Reclamation and mine closure costs 17 5 4 1
Total costs applicable to sales 216 157 191 192
Non-cash inventory adjustment -- -- -- --
Depreciation and amortization 34 48 65 79
Depreciation and amortization
adjustment -- -- -- --
Total production costs $250 $205 $256 $271
(1) Other includes La Herradura and Mesquite
Nevada Canada Yanacocha, Peru
Nine months ended
September 30, 2003 2002 2003 2002 2003 2002
Tons Mined (000 dry
short tons):
Open-Pit 131,264 100,917 n/a n/a 154,716 153,461
Underground 1,256 980 926 1,171 n/a n/a
Tons Milled/Processed
(000):
Oxide 1,795 3,774 943 1,180 n/a n/a
Refractory 6,865 6,703 n/a n/a n/a n/a
Leach 12,619 11,582 n/a n/a 113,317 108,549
Average Ore Grade
(oz/ton):
Oxide 0.148 0.124 0.242 0.225 n/a n/a
Refractory 0.216 0.215 n/a n/a n/a n/a
Leach 0.029 0.032 n/a n/a 0.028 0.023
Average Mill Recovery
Rate:
Oxide 82.7% 75.0% 95.3% 95.0% n/a n/a
Refractory 90.7% 87.9% n/a n/a n/a n/a
Ounces Produced (000): 1,859.2 1,916.3 212.2 261.2 2,183.9 1,589.5
Equity Ounces Produced
(000):
Oxide 217.4 353.1 212.2 261.2 n/a n/a
Refractory 1,360.9 1,237.7 n/a n/a n/a n/a
Leach 280.9 325.5 n/a n/a 1,121.4 816.2
Total 1,859.2 1,916.3 212.2 261.2 1,121.4 816.2
Equity Ounces Sold (000) 1,865.1 1,927.1 211.9 272.2 1,130.0 823.1
Production Costs Per
Ounce:
Direct mining and
production costs $253 $220 $254 $194 $116 $129
Capitalized mining &
other (22) 9 2 1 (3) (3)
Cash operating costs 231 229 256 195 113 126
Royalties and
production taxes 8 6 3 -- 5 5
Total cash costs 239 235 259 195 118 131
Reclamation and mine
closure costs 3 2 7 6 2 2
Total costs
applicable to sales 242 237 266 201 120 133
Non-cash inventory
adjustment -- 1 -- -- -- --
Depreciation and
amortization 57 46 89 68 62 57
Depreciation and
amortization
adjustment -- (2) -- -- -- --
Total production
costs $299 $282 $355 $269 $182 $190
Kori Kollo, Bolivia Other(1)
Nine months ended September 30, 2003 2002 2003 2002
Tons Mined (000 dry short tons):
Open-Pit 7,638 14,631 8,918 9,022
Underground n/a n/a n/a n/a
Tons Milled/Processed (000):
Oxide n/a n/a n/a n/a
Refractory 5,400 5,746 n/a n/a
Leach 3,696 4,664 3,067 2,971
Average Ore Grade (oz/ton):
Oxide n/a n/a n/a n/a
Refractory 0.036 0.049 n/a n/a
Leach 0.017 0.018 0.026 0.026
Average Mill Recovery Rate:
Oxide n/a n/a n/a n/a
Refractory 62.4% 59.6% n/a n/a
Ounces Produced (000): 161.4 218.4 93.7 92.7
Equity Ounces Produced (000):
Oxide n/a n/a n/a n/a
Refractory 108.1 150.7 n/a n/a
Leach 34.0 41.5 93.7 92.7
Total 142.1 192.2 93.7 92.7
Equity Ounces Sold (000) 144.5 191.9 93.7 92.7
Production Costs Per Ounce:
Direct mining and production costs $199 $160 $169 $182
Capitalized mining & other (13) (6) (4) (8)
Cash operating costs 186 154 165 174
Royalties and production taxes -- -- 6 4
Total cash costs 186 154 171 178
Reclamation and mine closure costs 12 4 3 2
Total costs applicable to sales 198 158 174 180
Non-cash inventory adjustment -- -- -- --
Depreciation and amortization 34 47 66 77
Depreciation and amortization
adjustment -- -- -- --
Total production costs $232 $205 $240 $257
(1) Other includes La Herradura and Mesquite
2. Gold Production Summary - Australia
Kalgoorlie Pajingo
Three months ended September 30, 2003 2002 2003 2002
Tons Mined (000 dry short tons) 13,178 11,492 204 158
Tons Milled/Processed 1,883 1,702 204 196
Average Ore Grade (oz/ton) 0.069 0.059 0.466 0.366
Average Mill Recovery Rate 84.0% 81.9% 96.8% 96.6%
Ounces Produced (000) 115.6 94.1 91.2 69.6
Equity Ounces Produced (000) 115.6 94.1 91.2 69.6
Equity Ounces Sold (000) 116.0 94.6 90.9 77.2
Production Costs Per Ounce:
Direct mining and production costs $283 $199 $131 $96
Capitalized mining & other (25) 18 (13) (3)
Cash operating costs 258 217 118 93
Royalties and production taxes 8 7 10 5
Total cash costs 266 224 128 98
Reclamation and mine closure costs 4 4 -- 3
Total costs applicable to sales 270 228 128 101
Non-cash inventory adjustment -- 1 -- --
Depreciation and amortization 19 22 90 48
Depreciation and amortization
adjustment -- 7 -- 54
Total production costs $289 $258 $218 $203
Tanami Yandal
Three months ended September 30, 2003 2002 2003 2002
Tons Mined (000 dry short tons) 4,948 4,103 1,002 1,001
Tons Milled/Processed 1,214 1,112 1,394 1,417
Average Ore Grade (oz/ton) 0.129 0.147 0.120 0.122
Average Mill Recovery Rate 95.7% 96.4% 90.1% 91.3%
Ounces Produced (000) 151.3 156.9 150.7 165.9
Equity Ounces Produced (000) 151.3 134.7 150.7 165.9
Equity Ounces Sold (000) 153.1 133.4 151.8 170.1
Production Costs Per Ounce:
Direct mining and production costs $215 $187 $258 $232
Capitalized mining & other 3 (2) 3 (8)
Cash operating costs 218 185 261 224
Royalties and production taxes 23 21 8 7
Total cash costs 241 206 269 231
Reclamation and mine closure costs 1 4 3 5
Total costs applicable to sales 242 210 272 236
Non-cash inventory adjustment -- -- -- --
Depreciation and amortization 58 31 80 80
Depreciation and amortization
adjustment -- 37 -- (6)
Total production costs $300 $278 $352 $310
Kalgoorlie Pajingo
Nine Months ended September 30 2003 2002 2003 2002
Tons Mined (000 dry short tons) 36,229 28,334 576 472
Tons Milled/Processed 5,327 4,438 598 537
Average Ore Grade (oz/ton) 0.071 0.059 0.442 0.381
Average Mill Recovery Rate 85.2% 82.7% 96.8% 96.8%
Ounces Produced (000) 309.2 223.1 258.3 203.8
Equity Ounces Produced (000) 309.2 223.1 258.3 203.8
Equity Ounces Sold (000) 309.2 221.1 258.7 208.6
Production Costs Per Ounce:
Direct mining and production costs $256 $202 $122 $87
Capitalized mining & other (2) 11 (8) (3)
Cash operating costs 254 213 114 84
Royalties and production taxes 9 7 11 7
Total cash costs 263 220 125 91
Reclamation and mine closure costs 3 5 -- 3
Total costs applicable to sales 266 225 125 94
Non-cash inventory adjustment -- 10 -- 4
Depreciation and amortization 23 24 80 42
Depreciation and amortization
adjustment -- 4 -- 43
Total production costs $289 $263 $205 $183
Tanami Yandal
Nine Months ended September 30 2003 2002 2003 2002
Tons Mined (000 dry short tons) 15,929 16,833 2,731 8,241
Tons Milled/Processed 3,446 2,722 4,010 3,416
Average Ore Grade (oz/ton) 0.141 0.144 0.117 0.136
Average Mill Recovery Rate 96.1% 96.6% 90.4% 92.1%
Ounces Produced (000) 467.7 382.6 433.6 437.9
Equity Ounces Produced (000) 448.5 328.6 433.6 437.9
Equity Ounces Sold (000) 449.3 318.1 433.0 423.8
Production Costs Per Ounce:
Direct mining and production costs $225 $183 $268 $211
Capitalized mining & other (7) 1 6 1
Cash operating costs 218 184 274 212
Royalties and production taxes 21 18 9 8
Total cash costs 239 202 283 220
Reclamation and mine closure costs 1 4 3 5
Total costs applicable to sales 240 206 286 225
Non-cash inventory adjustment -- 3 -- 1
Depreciation and amortization 59 28 70 80
Depreciation and amortization
adjustment -- 36 -- (13)
Total production costs $299 $273 $356 $293
3. Gold Production Summary - Other
Zarafshan, Ovacik,
Uzbekistan Turkey
Three months ended September 30, 2003 2002 2003 2002
Tons Mined (000 dry short tons) n/a n/a 2,152 1,296
Tons Milled/Processed:
Leach 2,082 2,053 n/a n/a
Mill n/a n/a 151 104
Average Ore Grade (oz/ton) 0.042 0.055 0.338 0.343
Average Mill Recovery Rate n/a n/a 93.7% 94.2%
Ounces Produced (000) 51.6 67.1 48.0 34.1
Equity Ounces Produced (000) 51.6 67.1 48.0 34.1
Equity Ounces Sold (000) 50.2 70.3 51.5 36.6
Production Costs Per Ounce:
Direct mining and production costs $151 $120 $136 $117
Capitalized mining & other 2 2 (21) (4)
Cash operating costs 153 122 115 113
Royalties and production taxes -- -- 13 10
Total cash costs 153 122 128 123
Reclamation and mine closure costs 2 (3) 1 4
Total costs applicable to sales 155 119 129 127
Non-cash inventory adjustment -- -- -- --
Depreciation and amortization 49 38 82 40
Depreciation and amortization
adjustment -- -- -- 65
Total production costs $204 $157 $211 $232
Martha, Minahasa,
New Zealand Indonesia
Three months ended September 30, 2003 2002 2003 2002
Tons Mined (000 dry short tons) 1,549 2,061 n/a n/a
Tons Milled/Processed:
Leach n/a n/a n/a n/a
Mill 354 320 172 180
Average Ore Grade (oz/ton) 0.078 0.107 0.142 0.190
Average Mill Recovery Rate 93.9% 89.3% 93.0% 89.4%
Ounces Produced (000) 26.4 30.8 22.2 33.4
Equity Ounces Produced (000) 26.3 30.8 20.9 31.5
Equity Ounces Sold (000) 26.2 27.7 23.1 28.3
Production Costs Per Ounce:
Direct mining and production costs $401 $192 $173 $255
Capitalized mining & other (184) (54) 3 1
Cash operating costs 217 138 176 256
Royalties and production taxes -- -- 6 3
Total cash costs 217 138 182 259
Reclamation and mine closure costs 2 5 6 25
Total costs applicable to sales 219 143 188 284
Non-cash inventory adjustment -- -- -- --
Depreciation and amortization 129 70 97 68
Depreciation and amortization
adjustment -- 54 -- --
Total production costs $348 $267 $285 $352
Zarafshan, Ovacik,
Uzbekistan Turkey
Nine Months ended September 30 2003 2002 2003 2002
Tons Mined (000 dry short tons) n/a n/a 4,061 3,162
Tons Milled/Processed:
Leach 6,116 5,912 n/a n/a
Mill n/a n/a 435 241
Average Ore Grade (oz/ton) 0.043 0.052 0.335 0.376
Average Mill Recovery Rate n/a n/a 93.6% 92.5%
Ounces Produced (000) 170.1 200.8 136.1 86.5
Equity Ounces Produced (000) 170.1 200.8 136.1 86.5
Equity Ounces Sold (000) 171.9 194.0 137.7 84.6
Production Costs Per Ounce:
Direct mining and production costs $146 $133 $120 $119
Capitalized mining & other 2 2 (6) (2)
Cash operating costs 148 135 114 117
Royalties and production taxes -- -- 12 11
Total cash costs 148 135 126 128
Reclamation and mine closure costs 2 (2) 1 4
Total costs applicable to sales 150 133 127 132
Non-cash inventory adjustment -- -- -- 7
Depreciation and amortization 46 41 82 25
Depreciation and amortization
adjustment -- -- -- 61
Total production costs $196 $174 $209 $225
Martha, Minahasa,
New Zealand Indonesia
Nine Months ended September 30 2003 2002 2003 2002
Tons Mined (000 dry short tons) 3,839 4,141 n/a n/a
Tons Milled/Processed:
Leach n/a n/a n/a n/a
Mill 990 820 544 525
Average Ore Grade (oz/ton) 0.082 0.104 0.158 0.218
Average Mill Recovery Rate 91.8% 90.3% 91.1% 90.9%
Ounces Produced (000) 74.5 77.6 78.4 116.3
Equity Ounces Produced (000) 72.8 77.6 73.7 109.4
Equity Ounces Sold (000) 73.5 74.3 81.2 114.1
Production Costs Per Ounce:
Direct mining and production costs $331 $192 $222 $200
Capitalized mining & other (106) (60) 3 2
Cash operating costs 225 132 225 202
Royalties and production taxes -- -- 6 4
Total cash costs 225 132 231 206
Reclamation and mine closure costs 2 4 4 6
Total costs applicable to sales 227 136 235 212
Non-cash inventory adjustment -- 7 -- --
Depreciation and amortization 111 80 68 69
Depreciation and amortization
adjustment -- 51 -- --
Total production costs $338 $274 $303 $281
4. Base Metal Summary - Batu Hijau and Golden Grove
Three months ended Nine months ended
September 30, September 30,
Batu Hijau 2003 2002 2003 2002
Total tons mined (000) 60,928 67,634 174,275 185,261
Total dry tons processed (000) 12,300 14,226 36,951 39,026
Average copper grade 0.82% 0.86% 0.74% 0.73%
Average recovery rate 90.7% 90.4% 89.2% 89.3%
Copper pounds produced (000) 184,154 219,645 488,168 505,375
Equity copper pounds produced (000) 103,587 123,550 274,595 284,273
Equity copper pounds sold (000) 103,246 114,487 264,290 271,427
Copper price per pound $0.84 $0.62 $0.80 $0.70
Equity ounces of gold sold (000) 116.5 96.9 262.7 200.2
Equity net cash cost per pound $0.10 $0.24 $0.19 $0.31
Equity non-cash cost per pound 0.17 0.14 0.19 0.18
Equity total production cost per pound $0.27 $0.38 $0.38 $0.49
Three months ended Nine months ended
September 30, September 30,
Golden Grove 2003 2002 2003 2002
Total tons mined 370,199 386,003 1,063,543 951,971
Total dry tons processed 346,008 363,350 1,044,689 917,362
Average copper grade 4.68% 4.83% 4.84% 5.17%
Average copper recovery rate 92.9% 87.8% 92.0% 89.5%
Copper produced pounds (000) 21,891 15,078 46,991 42,927
Copper sold pounds (000) 8,711 12,594 46,167 37,669
Copper price per pound $0.77 $1.08 $0.79 $0.83
Copper cash cost per pound $0.47 $0.31 $0.54 $0.55
Average zinc grade 13.42% 15.29% 12.37% 13.81%
Average zinc recovery rate 90.0% 90.1% 90.5% 84.6%
Zinc produced pounds (000) 12,518 35,174 87,394 76,062
Zinc sold pounds (000) 9,504 43,455 63,132 112,837
Zinc price per pound $1.03 $0.17 $0.45 $0.27
Zinc cash cost per pound $0.69 $0.28 $0.31 $0.17
Ounces of gold sold (000) 3.6 1.2 10.4 10.3
Ounces of silver sold (000) 391.0 46.1 1,165.8 899.5
5. Reconciliation of Costs Applicable to Sales to Total Cash Costs Per
Ounce and Per Pound, and Total Production Costs Per Ounce and Per Pound
The total cash costs and total production costs per ounce or pound are
non-GAAP performance measures that are intended to provide investors with
information about the cash generating capacities and profitability of
Newmont's mining operations. Newmont's management uses these measures for the
same purpose and for monitoring the performance of its mining operations.
These measures differ from measures determined in accordance with GAAP and
should not be considered in isolation or as a substitute for measures of
performance or liquidity determined in accordance with GAAP. These measures
were developed in conjunction with gold mining companies associated with the
Gold Institute in an effort to provide a level of comparability; however,
Newmont's measures may not be comparable to similarly-titled measures of other
companies.
Three months ended Total
September 30, La Golden North
2003 Nevada Mesquite Herradura Giant Holloway America
Costs applicable
to sales
under GAAP $172.2 $2.6 $3.1 $10.6 $5.3 $193.8
Minority
interest -- -- -- -- -- --
Reclamation/
accretion
expense (1.7) (0.1) (0.1) (0.3) (0.2) (2.4)
Write-down
inventories (1.9) -- -- -- -- (1.9)
Other (7.8) -- -- -- -- (7.8)
Total cash cost
for per ounce
calculations 160.8 2.5 3.0 10.3 5.1 181.7
Reclamation/
accretion
expense and
other 1.7 0.1 0.1 0.3 0.2 2.4
Depreciation,
depletion and
amortization 37.1 1.1 0.8 3.4 1.4 43.8
Minority interest
and other -- -- -- -- -- --
Total production
cost for per
ounce
calculations $199.6 $3.7 $3.9 $14.0 $6.7 $227.9
Equity ounces
sold (000) 696.9 12.6 16.5 42.8 17.4 786.2
Equity total
cash cost per
ounce sold $240 $196 $181 $238 $297 $239
Equity total
production cost
per ounce sold $298 $289 $231 $328 $388 $300
Three months ended Total
September 30, Kori South
2003 Yanacocha Kollo America Pajingo Kalgoorlie Yandal
Costs applicable
to sales
under GAAP $105.3 $10.8 $116.1 $11.7 $31.3 $41.7
Minority
interest (53.3) (1.3) (54.6) -- -- --
Reclamation/
accretion
expense (0.8) (0.7) (1.5) -- (0.3) (0.5)
Write-down
inventories -- -- -- -- -- (0.3)
Other -- -- -- -- -- --
Total cash cost
for per ounce
calculations 51.2 8.8 60.0 11.7 31.0 40.9
Reclamation/
accretion
expense
and other 0.8 0.7 1.5 -- 0.3 0.4
Depreciation,
depletion and
amortization 48.5 1.7 50.2 8.2 2.3 12.2
Minority
interest and
other (21.2) (0.2) (21.4) -- -- --
Total production
cost for
per ounce
calculations $79.3 $11.0 $90.3 $19.9 $33.6 $53.5
Equity ounces
sold (000) 451.2 43.8 495.0 90.9 116.0 151.8
Equity total
cash cost per
ounce sold $113 $199 $121 $128 $266 $269
Equity total
production cost
per ounce sold $175 $250 $182 $218 $289 $352
Three months ended
September 30, NFM Total Zarafshan,
2003 Tanami Australia Uzbekistan Minahasa Martha Ovacik
Costs applicable
to sales under
GAAP $37.2 $121.9 $7.7 $4.6 $5.8 $6.7
Minority
interest 0.1 0.1 -- -- 0.1 --
Reclamation/
accretion
expense (0.3) (1.1) -- (0.1) (0.1) --
Write-down
inventories -- (0.3) -- -- -- --
Other -- -- -- (0.3) -- --
Total cash
cost for per
ounce
calculations 37.0 120.6 7.7 4.2 5.8 6.7
Reclamation/
accretion
expense and
other -- 0.6 -- 0.1 -- 0.1
Depreciation,
depletion
and
amortization 8.8 31.5 2.5 2.4 3.3 4.2
Minority
interest
and other -- -- -- (0.1) -- --
Total production
cost for
per ounce
calculations $45.8 $152.7 $10.2 $6.6 $9.1 $11.0
Equity ounces
sold (000) 153.1 511.8 50.2 23.1 26.2 51.5
Equity total
cash cost
per ounce
sold $241 $235 $153 $182 $217 $128
Equity total
production
cost per
ounce sold $300 $298 $204 $285 $348 $211
Three months
ended Total
September 30, Other Total Golden Other
2003 International Gold Grove Non-Gold Consolidated
Costs applicable
to sales
under GAAP $24.8 $456.6 $4.8 $1.5 $462.9
Minority
interest 0.1 (54.4) -- -- (54.4)
Reclamation/
accretion
expense (0.3) (5.3) -- -- (5.3)
Write-down
inventories -- (2.2) (0.3) -- (2.5)
Other (0.3) (8.1) (4.5) (1.5) (14.1)
Total cash cost
for per ounce
calculations 24.3 386.6 -- -- 386.6
Reclamation/
accretion
expense and
other 0.2 4.7 -- -- 4.7
Depreciation,
depletion and
amortization 12.4 137.9 2.0 11.6 151.5
Minority
interest
and other (0.1) (21.5) (2.0) (11.6) (35.1)
Total production
cost for per
ounce
calculations $36.8 $507.7 -- -- $507.7
Equity ounces
sold (000) 151.0 1,944.0 n/a n/a 1,944.0
Equity total
cash cost per
ounce sold $160 $201 n/a n/a $201
Equity total
production
cost per
ounce sold $244 $265 n/a n/a $265
Three months ended Total
September 30, La Golden North
2002 Nevada Mesquite Herradura Giant Holloway America
Costs applicable
to sales
under GAAP $184.7 $3.5 $3.0 $13.6 $3.4 $208.2
Minority
interest -- -- -- -- -- --
Reclamation
expense (1.5) -- -- (0.4) (0.1) (2.0)
Write-down
inventories (20.4) -- -- (0.2) -- (20.6)
Non-cash
inventory
adjustment 0.1 -- -- -- -- 0.1
Other (0.3) -- -- -- -- (0.3)
Total cash
cost for
per ounce
calculations 162.6 3.5 3.0 13.0 3.3 185.4
Reclamation
expense and
other 1.5 -- -- 0.4 0.1 2.0
Depreciation,
depletion and
amortization 32.7 1.7 0.9 4.2 1.1 40.6
Minority
interest and
other -- -- -- -- -- --
Total production
cost for
per ounce
calculations $196.8 $5.2 $3.9 $17.6 $4.5 $228.0
Equity ounces
sold (000) 722.0 16.3 17.7 60.4 20.0 836.4
Equity total
cash cost per
ounce sold $225 $214 $169 $217 $161 $222
Equity total
production cost
per ounce sold $273 $322 $223 $293 $218 $273
Three months ended Total
September 30, Kori South
2002 Yanacocha Kollo America Pajingo Kalgoorlie Yandal
Costs applicable
to sales under
GAAP $82.4 $11.6 $94.0 $7.8 $21.6 $40.8
Minority
interest (41.1) (1.4) (42.5) -- -- --
Reclamation
expense (1.4) (0.3) (1.7) (0.2) (0.4) (0.9)
Write-down
inventories -- -- -- -- -- (0.6)
Non-cash
inventory
adjustment -- -- -- -- (0.1) --
Other (0.7) -- (0.7) (0.1) -- --
Total cash
cost for
per ounce
calculations 39.2 9.9 49.1 7.5 21.1 39.3
Reclamation
expense and
other 1.4 0.3 1.7 0.2 0.5 0.9
Depreciation,
depletion and
amortization 24.6 3.5 28.1 7.9 2.8 12.6
Minority
interest and
other (11.5) (0.4) (11.9) -- -- --
Total production
cost for per
ounce
calculations $53.7 $13.3 $67.0 $15.6 $24.4 $52.8
Equity ounces
sold (000) 329.6 64.9 394.5 77.2 94.6 170.1
Equity total
cash cost per
ounce sold $119 $152 $124 $98 $224 $231
Equity total
production cost
per ounce sold $164 $205 $171 $203 $267 $310
Three months ended
September 30, NFM Total Zarafshan,
2002 Tanami Australia Uzbekistan Minahasa Martha Ovacik
Costs applicable
to sales under
GAAP $32.9 $103.1 $8.4 $8.8 $4.0 $4.7
Minority
interest (4.6) (4.6) -- -- -- --
Reclamation
expense (0.6) (2.1) 0.2 (0.8) (0.1) (0.1)
Write-down
inventories -- (0.6) -- (0.3) -- --
Non-cash
inventory
adjustment -- (0.1) -- -- -- --
Other (0.5) (0.6) -- (0.4) -- (0.1)
Total cash cost
for per ounce
calculations 27.2 95.1 8.6 7.3 3.9 4.5
Reclamation
expense and
other 0.6 2.2 (0.2) 0.8 0.1 0.1
Depreciation,
depletion and
amortization 10.7 34.0 2.6 2.1 3.4 3.8
Minority
interest and
other (1.5) (1.5) -- (0.1) -- --
Total production
cost for
per ounce
calculations $37.0 $129.8 $11.0 $10.1 $7.4 $8.4
Equity ounces
sold (000) 133.4 475.3 70.3 28.3 27.7 36.6
Equity total
cash cost
per ounce sold $206 $201 $122 $259 $224 $123
Equity total
production cost
per ounce sold $278 $273 $157 $352 $267 $232
Three months
ended Total Other
September 30, Other Total Golden Non-
2002 International Gold Grove Kasese Gold Consolidated
Costs applicable
to sales under
GAAP $25.9 $431.2 $8.8 $1.7 $0.7 $442.4
Minority
interest -- (47.1) -- -- -- (47.1)
Reclamation
expense (0.8) (6.6) -- -- -- (6.6)
Write-down
inventories (0.3) (21.5) (0.2) -- -- (21.7)
Non-cash
inventory
adjustment -- -- -- -- -- --
Other (0.5) (2.1) (8.6) (1.7) (0.7) (13.1)
Total cash
cost for
per ounce
calculations 24.3 353.9 -- -- -- 353.9
Reclamation
expense and
other 0.8 6.7 -- -- -- 6.7
Depreciation,
depletion and
amortization 11.9 114.6 5.6 -- 13.4 133.6
Minority
interest
and other (0.1) (13.5) (5.6) -- (13.4) (32.5)
Total
production
cost for
per ounce
calculations $36.9 $461.7 -- -- -- $461.7
Equity ounces
sold (000) 162.9 1,869.1 n/a n/a n/a 1,869.1
Equity total
cash cost
per ounce
sold $149 $189 n/a n/a n/a $189
Equity total
production
cost per
ounce sold $226 $247 n/a n/a n/a $247
Nine months ended Total
September 30, La Golden North
2003 Nevada Mesquite Herradura Giant Holloway America
Costs applicable
to sales under
GAAP $456.1 $7.6 $8.8 $41.0 $15.4 $528.9
Minority
interest -- -- -- -- -- --
Reclamation/
accretion
expense (4.8) (0.2) (0.1) (1.2) (0.4) (6.7)
Write-down
inventories (2.9) -- -- -- -- (2.9)
Other (11.0) -- -- -- -- (11.0)
Total cash cost
for per ounce
calculations 437.4 7.4 8.7 39.8 15.0 508.3
Reclamation/
accretion
expense and
other 4.8 0.2 0.1 1.2 0.4 6.7
Depreciation,
depletion and
amortization 103.4 3.6 2.5 15.0 3.8 128.3
Minority
interest
and other -- -- -- -- -- --
Total production
cost for
per ounce
calculations $545.6 $11.2 $11.3 $56.0 $19.2 $643.3
Equity ounces
sold (000) 1,865.1 42.8 50.9 161.8 50.1 2,170.7
Equity total
cash cost
per ounce sold $239 $172 $171 $246 $300 $238
Equity total
production cost
per ounce sold $299 $261 $222 $347 $384 $302
Nine months ended Total
September 30, Kori South
2003 Yanacocha Kollo America Pajingo Kalgoorlie Yandal
Costs applicable
to sales under
GAAP $274.3 $32.6 $306.9 $32.5 $83.4 $126.8
Minority
interest (138.7) (3.9) (142.6) -- -- --
Reclamation/
accretion
expense (2.5) (1.8) (4.3) (0.1) (1.1) (1.6)
Write-down
inventories -- -- -- -- (1.0) (2.7)
Other -- -- -- -- -- --
Total cash cost
for per ounce
calculations 133.1 26.9 160.0 32.4 81.3 122.5
Reclamation/
accretion
expense
and other 2.5 1.8 4.3 (0.2) 1.1 1.5
Depreciation,
depletion and
amortization 124.4 5.6 130.0 20.7 6.9 30.2
Minority
interest
and other (54.3) (0.7) (55.0) -- -- --
Total production
cost for
per ounce
calculations $205.7 $33.6 $239.3 $52.9 $89.3 $154.2
Equity ounces
sold (000) 1,130.0 144.5 1,274.5 258.7 309.2 433.0
Equity total
cash cost per
ounce sold $118 $186 $125 $125 $263 $283
Equity total
production cost
per ounce sold $182 $232 $188 $205 $289 $356
Nine months ended
September 30, NFM Total Zarafshan,
2003 Tanami Australia Uzbekistan Minahasa Martha Ovacik
Costs applicable
to sales under
GAAP $114.6 $357.3 $25.7 $21.7 $19.7 $17.6
Minority
interest (4.2) (4.2) -- -- (0.3) --
Reclamation/
accretion
expense (0.8) (3.6) (0.2) (0.4) (0.3) (0.2)
Write-down
inventories (2.0) (5.7) -- (1.3) (2.6) --
Other -- -- -- (1.3) -- --
Total cash
cost for
per ounce
calculations 107.6 343.8 25.5 18.7 16.5 17.4
Reclamation/
accretion
expense and
other 0.1 2.5 0.2 0.4 0.1 0.1
Depreciation,
depletion and
amortization 27.5 85.3 8.0 5.8 8.2 11.4
Minority
interest
and other (1.0) (1.0) -- (0.3) (0.1) --
Total production
cost for
per ounce
calculations $134.2 $430.6 $33.7 $24.6 $24.7 $28.9
Equity ounces
sold (000) 449.3 1,450.2 171.9 81.2 73.5 137.7
Equity total
cash cost per
ounce sold $239 $237 $148 $231 $225 $126
Equity total
production cost
per ounce sold $299 $297 $196 $303 $338 $209
Nine months
ended Total
September 30, Other Total Golden Other
2003 International Gold Grove Non-Gold Consolidated
Costs applicable
to sales under
GAAP $84.7 $1,277.8 $29.7 $3.4 $1,310.9
Minority
interest (0.3) (147.1) -- -- (147.1)
Reclamation/
accretion
expense (1.1) (15.7) -- -- (15.7)
Write-down
inventories (3.9) (12.5) (7.1) -- (19.6)
Other (1.3) (12.3) (22.6) (3.4) (38.3)
Total cash cost
for per ounce
calculations 78.1 1,090.2 -- -- 1,090.2
Reclamation/
accretion
expense and
other 0.8 14.3 -- -- 14.3
Depreciation,
depletion and
amortization 33.4 377.0 15.8 28.6 421.4
Minority
interest
and other (0.4) (56.4) (15.8) (28.6) (100.8)
Total production
cost for
per ounce
calculations $111.9 $1,425.1 -- -- $1,425.1
Equity ounces
sold (000) 464.3 5,359.7 n/a n/a 5,359.7
Equity total
cash cost per
ounce sold $168 $205 n/a n/a $205
Equity total
production cost
per ounce sold $241 $268 n/a n/a $268
Nine months ended Total
September 30, La Golden North
2002 Nevada Mesquite Herradura Giant Holloway America
Costs applicable
to sales under
GAAP $494.2 $8.0 $8.7 $40.9 $14.1 $565.9
Minority
interest -- -- -- -- -- --
Reclamation
expense (4.4) -- (0.1) (1.2) (0.4) (6.1)
Write-down
inventories (35.7) -- -- (0.2) -- (35.9)
Non-cash
inventory
adjustment (1.4) -- -- -- -- (1.4)
Other (0.3) -- -- -- -- (0.3)
Total cash cost
for per ounce
calculations 452.4 8.0 8.6 39.5 13.7 522.2
Reclamation
expense and
other 5.9 -- 0.1 1.2 0.4 7.6
Depreciation,
depletion and
amortization 84.7 4.7 2.4 14.3 4.2 110.3
Minority interest
and other -- -- -- -- -- --
Total production
cost for
per ounce
calculations $543.0 $12.7 $11.1 $55.0 $18.3 $640.1
Equity ounces
sold (000) 1,927.1 44.2 48.5 201.2 71.0 2,292.0
Equity total
cash cost per
ounce sold $235 $180 $177 $196 $192 $228
Equity total
production cost
per ounce sold $282 $287 $229 $273 $257 $279
Nine months ended Total
September 30, Kori South
2002 Yanacocha Kollo America Pajingo Kalgoorlie Yandal
Costs applicable
to sales under
GAAP $221.1 $34.4 $255.5 $20.6 $52.0 $96.8
Minority
interest (110.7) (4.1) (114.8) -- -- --
Reclamation
expense (2.0) (0.8) (2.8) (0.6) (1.1) (2.3)
Write-down
inventories -- -- -- -- -- (1.0)
Non-cash
inventory
adjustment -- -- -- (0.8) (2.2) (0.3)
Other (0.7) -- (0.7) (0.3) -- (0.1)
Total cash cost
for per ounce
calculations 107.7 29.5 137.2 18.9 48.7 93.1
Reclamation
expense and
other 2.0 0.8 2.8 1.4 3.3 2.6
Depreciation,
depletion and
amortization 85.8 10.4 96.2 17.8 6.2 28.4
Minority
interest
and other (39.4) (1.3) (40.7) -- -- --
Total production
cost for
per ounce
calculations $156.1 $39.4 $195.5 $38.1 $58.2 $124.1
Equity ounces
sold (000) 823.1 191.9 1,015.0 208.6 221.1 423.8
Equity total
cash cost per
ounce sold $131 $154 $135 $91 $220 $220
Equity total
production cost
per ounce sold $190 $205 $193 $183 $263 $293
Nine months ended
September 30, NFM Total Zarafshan,
2002 Tanami Australia Uzbekistan Minahasa Martha Ovacik
Costs applicable
to sales under
GAAP $78.0 $247.4 $25.8 $26.1 $10.8 $11.9
Minority
interest (11.0) (11.0) -- -- -- --
Reclamation
expense (1.3) (5.3) 0.4 (0.8) (0.3) (0.3)
Write-down
inventories -- (1.0) -- (0.3) -- --
Non-cash
inventory
adjustment (1.1) (4.4) -- -- (0.5) (0.6)
Other (0.8) (1.2) -- (1.5) (0.1) (0.2)
Total cash cost
for per ounce
calculations 63.8 224.5 26.2 23.5 9.9 10.8
Reclamation
expense and
other 2.4 9.7 (0.4) 0.8 0.8 0.9
Depreciation,
depletion and
amortization 23.7 76.1 8.0 8.3 9.7 7.3
Minority
interest
and other (3.3) (3.3) -- (0.5) -- --
Total production
cost for
per ounce
calculations $86.6 $307.0 $33.8 $32.1 $20.4 $19.0
Equity ounces
sold (000) 318.1 1,171.6 194.0 114.1 74.3 84.6
Equity total
cash cost per
ounce sold $202 $192 $135 $206 $132 $128
Equity total
production cost
per ounce sold $273 $262 $174 $281 $274 $225
Nine months
ended Total Other
September 30, Other Total Golden Non-
2002 International Gold Grove Kasese Gold Consolidated
Costs applicable
to sales under
GAAP $74.6 $1,143.4 $21.8 $7.8 $0.8 $1,173.8
Minority
interest -- (125.8) -- -- -- (125.8)
Reclamation
expense (1.0) (15.2) -- -- -- (15.2)
Write-down
inventories (0.3) (37.2) (0.4) -- -- (37.6)
Non-cash
inventory
adjustment (1.1) (6.9) -- -- -- (6.9)
Other (1.8) (4.0) (21.4) (7.8) (0.8) (34.0)
Total cash cost
for per ounce
calculations 70.4 954.3 -- -- -- 954.3
Reclamation
expense and
other 2.1 22.2 -- -- -- 22.2
Depreciation,
depletion and
amortization 33.3 315.9 12.6 -- 30.9 359.4
Minority
interest
and other (0.5) (44.5) (12.6) -- (30.9) (88.0)
Total production
cost for
per ounce
calculations $105.3 $1,247.9 -- -- -- $1,247.9
Equity ounces
sold (000) 467.0 4,945.6 n/a n/a n/a 4,945.6
Equity total
cash cost per
ounce sold $151 $193 n/a n/a n/a $193
Equity total
production cost
per ounce sold $225 $252 n/a n/a n/a $252
6. Reconciliation of Batu Hijau Costs Applicable to Sales to Equity Net
Cash Costs Per Pound
Three months ended Nine months ended
September 30, September 30,
2003 2002 2003 2002
Costs applicable to sales under GAAP ($4,085) $18,167 $31,691 $79,514
Smelting and refining 26,734 31,109 70,533 76,696
Minority interest (11,255) (22,753) (47,924) (71,763)
Reclamation/accretion expense (952) 1,286 (3,286) (622)
Total cash cost for per pound
calculation 10,442 27,809 51,014 83,825
Reclamation/accretion expense and
other 952 (1,286) 3,286 622
Depreciation, depletion and
amortization 16,158 17,489 46,651 48,442
Total production cost for per pound
calculation $27,552 $44,012 $100,951 $132,889
Equity copper pounds sold (000) 103,246 114,487 264,290 271,427
Equity net cash cost per pound $0.10 $0.24 $0.19 $0.31
Equity total production cost per
pound $0.27 $0.38 $0.38 $0.49
7. Reconciliation of Golden Grove Costs Applicable to Sales to Total
Copper and Zinc Cash Costs Per Pound
Three months ended September 30,
2003 2002
Total Zinc Total Copper Zinc
Costs applicable to sales under
GAAP $4,737 $418 $8,717 $1,255 $7,462
Smelting and refining 6,347 5,434 7,339 2,775 4,564
Reclamation/accretion expense (90) (17) -- -- --
Write-down of inventories (316) 747 (161) (94) (67)
Total cash cost for per pound
calculation 10,678 6,582 15,895 3,936 11,959
Reclamation/accretion expense
and other 90 17 -- -- --
Depreciation, depletion and
amortization 2,046 186 5,606 1,256 4,350
Total production cost for per
pound calculation $12,814 $6,785 $21,501 $5,192 $16,309
Total pounds sold (000) n/a 9,504 n/a 12,594 43,455
Equity net cash cost per pound n/a $0.69 n/a $0.31 $0.28
Equity total production cost
per pound n/a $0.71 n/a $0.41 $0.38
Nine months ended September 30,
2003 2002
Total Zinc Total Copper Zinc
Costs applicable to sales
under GAAP $29,670 $7,574 $21,835 $14,720 $7,115
Smelting and refining 22,682 15,524 18,877 6,530 12,347
Reclamation/accretion expense (269) (119) -- -- --
Write-down of inventories (7,095) (3,123) (418) (347) (71)
Total cash cost for per pound
calculation 44,988 19,856 40,294 20,903 19,391
Reclamation/accretion expense
and other 269 119 -- -- --
Depreciation, depletion and
amortization 15,814 6,366 12,623 7,709 4,914
Total production cost for per
pound calculation $61,071 $26,341 $52,917 $28,612 $24,305
Total pounds sold (000) n/a 63,132 n/a 37,669 112,837
Equity net cash cost per
pound n/a $0.31 n/a $0.55 $0.17
Equity total production cost
per pound n/a $0.42 n/a $0.76 $0.22
8. Gold Hedge Position - Current Maturity Summary(1) (000 ounces)
Australian Gold Hedge Books Newmont Gold
Hedge Book
Gold Put Gold Forward Convertible Sold Price Capped
Option Sales Put Options Combination Contracts
Contracts Contracts & Other Put Options
Instruments
Years Ozs Price Ozs Price Ozs Price Ozs Price Ozs Price
(2) (2) (2) (2) (2)
2003 52 $292 -- -- -- -- -- -- -- --
2004 203 $292 -- -- -- -- -- -- -- --
2005 205 $292 -- -- -- -- -- -- 500 $350
2006 100 $338 -- -- -- -- -- -- -- --
2007 20 $397 -- -- -- -- -- -- -- --
2008 -- -- -- -- -- -- -- -- 1,000 $384
2009 -- -- -- -- -- -- -- -- 600 $381
2010 -- -- -- -- -- -- -- -- -- --
2011 -- -- -- -- -- -- -- -- 250 $392
Total/
Average
(1) 580 $304 -- -- -- -- -- -- 2,350 $377
The mark-to-market value of the Australian gold hedge books was negative
$11 million at September 30, 2003.
The following table shows the approximate sensitivities of the US$ mark-
to-market value of the Australian gold hedge books to certain market variables
as of September 30, 2003 (actual changes in the timing and amount of the
following variables may differ from the assumed changes below):
Market Variables Change in Variable Change in
Mark-to-Market Value
(millions)
A$ Interest Rates +/-1.0% -/+ $0.0
US$/A$ Exchange Rates +/- US$0.01 +/-$0.0
Gold Lease Rates +/-1.0% +/-$1.1
US$ Interest Rates +/-1.0% -/+$1.2
US$ Gold Price/oz. +/-$1.00 -/+$0.2
Notes:
1. For more detailed descriptions, definitions and explanations, refer
to the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 2003.
2. Prices quoted are gross contract prices, which represent the gross
cash flow per ounce of each contract. Not included in these prices are
the additional cash outflows associated with borrowing gold over the
life of the contract where the contracts are floating in nature. The
rate at which gold is borrowed is determined over the life of the
contract based on the prevailing market gold lease rate for the time
period that the borrowing is fixed. The borrowing can be fixed for
varying periods over the life of the contract.
Investor Information
Investor Contacts
Russell Ball
Telephone: (303) 837-5927
Email: russell_ball@corp.newmont.com
Wendy Yang
Telephone: (303) 837-6141
Email: wyang@corp.newmont.com
Nicola Frazer
Telephone: 61-8-8303-1756
Email: nfrazer@newmont.com.au
Media Contacts
Doug Hock
Telephone: (303) 837-5812
Email: doughock@corp.newmont.com
Danielle Martin
Telephone: 61-8-8303-1911
Email: danielle.martin@newmont.com.au
Corporate Address
Newmont Mining Corporation
1700 Lincoln Street
Denver, CO 80203
Telephone: (303) 863-7414
Facsimile: (303) 837-5837
Company Website
www.newmont.com
Stock Exchange Listings - Ticker
New York Stock Exchange NEM
Toronto Stock Exchange NMC
Australian Stock Exchange NEM
NYSE Share Price Performance (Q3)
Jul 03 Aug 03 Sep 03 Q3 2003
High $36.29 $39.58 $42.17 $42.17
Low $31.25 $35.58 $37.90 $31.25
Last $36.10 $39.26 $39.09 $39.09
Shareholder Information
Please contact the respective stock transfer agent acting as transfer
agent, registrar and dividend disbursing agent for the securities listed
below. Information regarding shareholder accounts, dividend payments, stock
transfer and related matters for the respective securities should be directed
to the transfer agent listed.
For holders of Newmont Stock (NYSE:NEM)
Mellon Investor Services, LLC
85 Challenger Road
Ridgefield Park, NJ 07660
Toll free: (888) 216-8104
(between 8:00 a.m. and 8:00 p.m. Eastern Time)
Internet: www.melloninvestor.com
For holders of Newmont Exchangeable Shares
(TSX: NMC)
Computershare Trust Company of Canada
100 University Avenue, 9th Floor
Toronto, Ontario M5J 2Y1
Canada
Toll-Free: (800) 663-9097
Telephone: (416) 981-9633
Internet: caregistryinfo@computershare.com
For holders of Newmont CHESS Depository Interests
(CDIs trading on ASX: NEM)
National Shareholder Services Pty Limited
100 Hutt Street, Adelaide 5000
South Australia
Australia
Telephone: 61-8-8232-0003
Facsimile: 61-8-8232-0072
The Company's third quarter earnings conference call and web cast
presentation is scheduled for Wednesday, October 29, 2003 beginning at 4:00
p.m. Eastern Standard Time (2:00 p.m. Mountain Standard Time). To
participate:
Dial-In Number: (630) 395-0029
Leader: Russell Ball
Password: Newmont
The conference call will also be simultaneously carried on our web site
under Investor Information/Presentations and will be archived there for a
limited time.
Cautionary Statement
This news release contains "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and 21E of the
Securities Exchange Act of 1934, as amended, that are intended to be covered
by the safe harbor created by such sections. Such forward-looking statements
include, without limitation, (i) estimates of future earnings, and the
sensitivity of earnings to the gold and other metals prices; (ii) estimates of
future gold and other metals production and sales, (iii) estimates of future
cash costs; (iv) estimates of future cash flows, and the sensitivity of cash
flows to the gold and other metals prices; (v) statements regarding future
debt repayments; (vi) estimates of future capital expenditure,tax rates and
expenses; (vii) estimates of reserves, and statements regarding future
exploration results and the replacement of reserves; (viii) statements
regarding anticipated timing of various transactions and projects; and (ix)
statements regarding future royalty revenues. Where the Company expresses or
implies an expectation or belief as to future events or results, such
expectation or belief is expressed in good faith and believed to have a
reasonable basis. However, forward-looking statements are subject to risks,
uncertainties and other factors, which could cause actual results to differ
materially from future results expressed, projected or implied by such
forward-looking statements. Such risks include, but are not limited to, gold
and other metals price volatility, currency fluctuations, increased production
costs and variances in ore grade or recovery rates from those assumed in
mining plans, as well as political and operational risks in the countries in
which we operate and governmental regulation and judicial outcomes. For a more
detailed discussion of such risks and other factors, see the Company's Annual
Report on Form 10-K for the year ended December 31, 2002, which is on file
with the Securities and Exchange Commission, as well as the Company's other
SEC filings. The Company does not undertake any obligation to release
publicly any revisions to any "forward-looking statement" to reflect events or
circumstances after the date of this news release, or to reflect the
occurrence of unanticipated events, except as may be required under applicable
securities laws.
SOURCE Newmont Mining Corporation
-0- 10/29/2003 AA LAW064
/PRNewswire-FirstCall -- Oct. 29/
/END FIRST AND FINAL ADD/
/Web site: http://www.melloninvestor.com /
/Web site: http://www.newmont.com /
(NEM NMC.)
CO: Newmont Mining Corporation
ST: Colorado, Ontario
IN: MNG
SU: ERN CCA