Exhibit 99.1
NEWMONT ANNOUNCES FOURTH QUARTER NET INCOME OF $182 MILLION ($0.41 PER SHARE);
2004 NET INCOME OF $435 MILLION ($0.98 PER SHARE)
DENVER, Feb. 24 /PRNewswire-FirstCall/ -- Newmont Mining Corporation (NYSE:
NEM) today announced fourth quarter net income of $181.6 million ($0.41 per
share) compared with net income of $153.1 million ($0.36 per share) for the
fourth quarter of 2003. Newmont earned net income of $434.5 million ($0.98 per
share) for 2004. Fourth quarter and 2004 highlights included:
* Equity gold sales(1) for the fourth quarter of 1.8 million ounces at
total cash costs(2) of $226 per ounce; equity gold sales for 2004 of 7.0
million ounces at total cash costs of $231 per ounce;
* Net cash provided by operating activities for the fourth quarter of $587
million and 2004 net cash provided by operating activities of $1.6
billion; and
* Cash and cash equivalents, marketable securities and investments
exceeded debt by $490 million at year-end.
Wayne W. Murdy, Chairman and Chief Executive Officer, said, "We ended the
year with a strong fourth quarter, benefiting from rising gold prices. Our
record $1.6 billion cash flow from operations in 2004 demonstrated the strength
of our portfolio and our leverage to the gold price. We remain optimistic about
gold prices given the current macro-economic and market fundamentals."
Fourth Quarter Year
--------------------------- ---------------------------
2004 2003 2004 2003
------------ ------------ ------------ ------------
Financial (in millions,
except per share)
Revenues $ 1,230.0 $ 805.8 $ 4,524.2 $ 3,157.8
Net cash provided by
operating activities $ 587.0 $ 203.9 $ 1,556.8 $ 684.4
Net income $ 181.6 $ 153.1 $ 434.5 $ 475.7
Net income per common
share, basic $ 0.41 $ 0.36 $ 0.98 $ 1.16
Operating
Equity gold sales
(000 ounces)(1) 1,797.9 1,715.1 6,988.4 7,383.6
Average realized price
($/equity ounce) $ 436 $ 394 $ 412 $ 366
Total cash costs
($/equity ounce)(2) $ 226 $ 197 $ 231 $ 203
Total production costs
($/equity ounce)(2) $ 284 $ 259 $ 295 $ 266
1. Equity gold sales are those attributable to Newmont's ownership or
economic interest.
2. For a reconciliation of total cash costs per ounce 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
Fourth quarter net income was $181.6 million ($0.41 per share), compared
with $153.1 million ($0.36 per share) for the fourth quarter of 2003. For 2004,
net income was $434.5 million ($0.98 per share), compared with net income of
$475.7 million ($1.16 per share) for 2003.
Net income for the fourth quarter of 2004 was impacted by the following
items:
* a $9 million ($0.02 per share) non-cash, after-tax write-down of
long-lived assets;
* a $52 million ($0.12 per share) non-cash, after-tax write-down of
goodwill at Pajingo;
* a $3 million ($0.01 per share) non-cash, after-tax net gain on the
disposition of Perama and QMC;
* a $62 million ($0.14 per share) net tax benefit resulting from the
release of tax valuation allowances, tax true-ups and the filing of a
consolidated tax return in Australia; and
* a $16 million ($0.04 per share) non-cash, after-tax gain relating to FAS
143 reclamation estimate revisions.
These items had the net effect of increasing net income for the fourth
quarter of 2004 by $19 million ($0.04 per share).
Net income for the fourth quarter of 2003 was impacted by the following
items:
* a $30 million ($0.07 per share) non-cash, after-tax loss on an inherited
guarantee of QMC debt;
* a $10 million ($0.02 per share) after-tax loss on the early
extinguishment of debt;
* an $18 million ($0.04 per share) non-cash, after-tax impairment charge
at Golden Giant in Canada; and
* a $72 million ($0.17 per share) tax benefit from the release of
valuation allowances.
These items had the net effect of increasing net income for the fourth
quarter of 2003 by $14 million ($0.03 per share).
For the fourth quarter of 2004, the Company sold 1,797,900 equity ounces of
gold, 5% higher than the prior year quarter gold sales of 1,715,100 equity
ounces. The average realized gold price for the fourth quarter was $436 per
ounce, an 11% increase over the prior year quarter.
For 2004, the Company sold 6,988,400 equity ounces of gold, 5% lower than
2003, largely as a result of increased stripping and lower grades in Nevada, the
sale of non-core mines and the suspension of the Ovacik operations since August
2004. The average realized price for 2004 was $412 per ounce, a 13% increase
over 2003.
The Company generated net cash from operating activities of $587 million in
the fourth quarter and $1.6 billion for 2004.
Operating Highlights
Q4 Q4
North America 2004 2003 2004 2003
------------ ------------ ------------ ------------
Equity gold sales (000 ozs) 746.2 731.9 2,712.2 2,902.6
Total cash costs ($/ounce)(1) $ 267 $ 218 $ 278 $ 233
* Nevada operations sold 668,200 equity ounces in the fourth quarter (+7%)
primarily due to increased tons milled and higher mill recoveries,
offset by lower leach production and lower mill grades. Total cash costs
of $265 per equity ounce (+20%) increased largely due to higher energy
and maintenance costs.
* Golden Giant in Canada sold 41,600 ounces in the fourth quarter (-39%)
on lower ore grade (-34%) as the mine approaches closure. Total cash
costs of $307 per ounce (+70%) increased due to lower production and the
appreciation of the Canadian dollar.
* Holloway in Canada sold 19,000 equity ounces in the fourth quarter
(+27%) due to an increase in throughput (+3%) and an increase in ore
grade (+9%). Total cash costs per equity ounce were $360 (+2%) as
increased labor and electricity costs and the appreciation of the
Canadian dollar more than offset the higher production.
* La Herradura in Mexico sold 17,400 equity ounces in the fourth quarter
(+3%) at total cash costs of $116 per equity ounce (-15%).
Q4 Q4
South America 2004 2003 2004 2003
------------ ------------ ------------ ------------
Equity gold sales (000 ozs) 440.9 351.9 1,582.7 1,626.4
Total cash costs ($/ounce)(1) $ 125 $ 128 $ 137 $ 126
* Yanacocha in Peru sold 436,000 equity ounces in the fourth quarter
(+29%) from planned mining sequence changes that increased ore grades
and inventory reduction resulting from the addition of three carbon
columns in August 2004. Total cash costs of $124 per ounce (-2%) were
favorably impacted by increased production, partially offset by higher
diesel consumption and prices, increased consumption of reagents and
higher royalties due to the increased gold price.
* Kori Kollo in Bolivia sold 4,900 equity ounces in the fourth quarter
(-65%) at total cash costs of $221 per equity ounce (+34%) as production
continued from residual leaching.
Q4 Q4
Australia/New Zealand 2004 2003 2004 2003
------------ ------------ ------------ ------------
Equity gold sales (000 ozs) 477.0 477.4 1,906.9 2,011.5
Total cash costs ($/ounce)(1) $ 280 $ 224 $ 272 $ 234
* The Australian and New Zealand operations sold 477,000 equity ounces in
the fourth quarter. Total cash costs of $280 per equity ounce increased
25% from the year ago quarter, largely due to lower grades at Pajingo,
stronger Australian and New Zealand dollars and higher diesel and
consumable costs.
* Kalgoorlie sold 123,100 equity ounces (+29%) due to higher production
(+11%) and a reduction in inventory. Total cash costs of $297 per equity
ounce (+12%) increased due to lower grades and recoveries as well as
increased diesel and consumable costs.
* Pajingo sold 69,400 ounces (-3%) at total cash costs of $232 per ounce
(+61%). Total cash costs increased primarily due to increased tons
milled (+7%), lower ore grade (-27%) and increased mine maintenance
costs.
* Tanami sold 152,200 ounces (+9%) due to an increase in mill throughput
(+6%). Total cash costs of $322 per ounce (+32%) were higher due to
lower grades and additional underground backfill costs.
* Yandal sold 88,300 ounces (-33%) in the fourth quarter. The decrease was
largely due to the sale of the Wiluna and Bronzewing mines in December
2003 and 2004, respectively. Total cash costs increased 8%, largely from
higher consumable costs.
* Martha in New Zealand sold 40,200 ounces (+14%) at total cash costs of
$201 per ounce (+41%) as higher grades were more than offset by higher
slope stability costs and consumable costs.
* Golden Grove sold 13.9 million pounds of copper (-51%) and 22.4 million
pounds of zinc (-46%) due mainly to lower tons processed and the timing
of shipments. Total cash costs per pound of copper ($1.01) and zinc
($0.35) increased 51% and 150%, respectively, primarily from higher
ground support costs and lower production.
Q4 Q4
Indonesia-Batu Hijau 2004 2003 2004 2003
------------ ------------ ------------ ------------
Equity copper sales (M lbs) 86.9 79.1 378.8 343.4
Total cash costs ($/lb Cu)(1, 2) $ 0.65 $ 0.57 $ 0.60 $ 0.46
Equity gold sales (000 ozs) 94.6 66.2 396.3 328.9
Total cash costs ($/oz Au)(1, 2) $ 124 $ 131 $ 128 $ 121
* Effective January 1, 2004, the Company consolidated Batu Hijau and
changed to co-product cost accounting for copper and gold, whereby
specifically identifiable production costs are assigned for each product
and any remaining costs are allocated in proportion to the sales revenue
generated by each product. As a result, reported cash costs are impacted
by relative movements in prices and production.
* Effective October 1, 2004, Newmont's economic interest in Batu Hijau
decreased to 52.875% from 56.25%, reflecting cumulative positive
retained earnings at the end of the third quarter and the initiation of
dividend payments to the minority partner.
* Batu Hijau sold 86.9 million equity pounds of copper (+10%) and 94,600
equity ounces of gold (+43%) in the fourth quarter as a result of higher
mill throughput (+12%) and higher ore grades (copper +5%, gold +28%),
partially offset by lower recoveries.
* Copper and gold total cash costs were $0.65 per pound and $124 per
ounce, respectively, in the fourth quarter. Mining and processing costs
were lower than the year ago quarter, but this was offset by increased
treatment and refining charges and administrative costs.
Q4 Q4
Central Asia 2004 2003 2004 2003
------------ ------------ ------------ ------------
Equity gold sales (000 ozs) 39.2 76.7 320.1 386.3
Total cash costs ($/ounce)(1) $ 157 $ 144 $ 166 $ 139
* Zarafshan in Uzbekistan sold 39,200 equity ounces (-15%) as a result of
lower ore grade (-11%). Total cash costs of $157 per equity ounce (+9%)
were higher due to lower production.
* The Ovacik operations were suspended in August 2004 as a result of a
Turkish court decision and pending completion of additional permitting
requirements.
1. For a reconciliation of total cash costs per ounce and per pound and
total production costs per ounce and per pound (non-GAAP measures of
performance) to costs applicable to sales calculated and presented under
GAAP, please refer to the Supplemental Information attached.
2. 2003 total cash costs for Batu Hijau included pro forma results to
reflect the change to co-product accounting effective January 1, 2004.
Other Highlights
Cash, Marketable Securities and Debt
At the end of the fourth quarter, cash and cash equivalents totaled $1.6
billion, essentially offsetting outstanding debt of $1.6 billion. Of the
outstanding debt, $706 million was Batu Hijau project finance debt that is
non-recourse to Newmont. During the fourth quarter, outstanding debt decreased
by a net $93 million.
At the close of markets on December 31, the value of the Company's
marketable securities and other investments portfolio was $0.5 billion.
Newmont Capital
Newmont Capital manages the Company's royalty and marketable securities
portfolios as well as asset transactions. For the fourth quarter, royalty and
dividend income increased to $18.2 million (+17%). For 2004, royalty and
dividend income was $65.8 million compared with $56.3 million in 2003. The
increases primarily reflected higher precious metals, oil and gas prices and
distributions from the Canadian Oil Sands Trust investment made in 2004.
During the fourth quarter, Newmont Capital entered into or closed the
following transactions and agreements:
* the restructuring of the Company's obligations at QMC in Australia;
* the sale of the Perama property in Greece;
* the sale of the Company's interest in the Midwest Uranium joint venture
in Canada; and
* a private placement in Stratagold to fund exploration initiatives in
Canada and Guyana.
In February 2005, Newmont Capital entered into an agreement for the sale of
Ovacik to a subsidiary of Koza Davetieye, a Turkish conglomerate. The sale is
expected to be completed by the end of the first quarter.
Project Development
The development of the Leeville underground project in Nevada remains on
schedule with initial gold production expected in the fourth quarter of 2005.
Ventilation shaft excavation work was completed during the fourth quarter. The
production shaft is 88% complete to a depth of 1,610 feet. Development of ore
access continues as does construction of support facilities underground.
At Phoenix in Nevada, a ground-breaking ceremony in the fourth quarter was
followed by the start of construction of the processing facilities. Engineering
is approximately 75% complete with initial gold production expected in mid-2006.
At the Ahafo project in Ghana, engineering work is approximately 80%
complete. Construction is approximately 20% complete with camp and
infrastructure construction progressing along with earth works preparation for
the mill, the tailings facility and the water storage dam. The Afaho project
remains on schedule for initial gold production in the second half of 2006.
At Akyem in Ghana, the feasibility study update is nearing completion and a
development decision is expected by mid-2005.
At Boddington in Australia, completion of the feasibility study update is
expected by mid-2005.
Exploration
Exploration, research and development expenditures were $192.4 million in
2004, compared with $115.2 million in 2003. Newmont drilled 2.8 million feet
(542 miles) during the year, resulting in discoveries that added 8.6 million
equity ounces to reserves, with an additional 3.8 million equity ounces added
from the $25 higher gold price assumption of $350 per ounce.
Drilling at Ahafo intersected higher grade mineralization at depth in the
south area, which will be followed up in 2005 with further drilling to test for
open pit extension as well as underground mining potential. At Akyem, further
drilling in 2005 will test new targets in the area.
In Nevada, a 275-hole drill program at Phoenix resulted in the addition of
2.3 million ounces of reserves, expanding the pit shells and increasing the mine
life from 13 years to 17 years. At Gold Quarry, infill drilling converted
non-reserve material to reserves and, coupled with design changes of the Gold
Quarry pit, maintained reserves of 6 million ounces after depletion of more than
600,000 ounces in 2004.
In Peru, the Company added 4.5 million equity ounces of reserves at Minas
Conga. Further drilling and optimization efforts are continuing at Minas Conga
in 2005.
At Batu Hijau in Indonesia, gold reserves were replaced, while the higher
$0.90 per pound copper price assumption contributed to copper reserve additions
that nearly replaced depletion.
Drilling in 2005 in Australia and in New Zealand will focus on potential new
deposits and on expanding mineralized zones at Tanami's Callie underground mine,
Jundee, Pajingo and Martha.
2005 Guidance
For 2005, the Company expects gold sales of between 6.6 million and 6.8
million equity ounces at total cash costs of between $235 and $245 per ounce.
Lower expected equity gold sales are largely attributable to the assumed sale of
Ovacik in the first quarter of 2005. Increased cash costs are primarily due to
lower ore grades processed and slightly lower than expected recovery rates, as
well as assumed ongoing US dollar weakness and higher consumable costs. The
Company expects that equity sales for the second half of the year will be
between 10% and 15% higher than the first half due to mine plan sequencing.
Guidance for exploration, research and development expenditures for 2005 is
between $170 million and $200 million on a consolidated basis, reflecting
continued optimization of feasibility studies at Minas Conga in Peru, and
ongoing exploration and advanced study efforts at Ahafo and Akyem in Ghana, as
well as Elang and Martabe in Indonesia.
The Company expects consolidated capital expenditures for 2005 of between
$1.0 billion and $1.3 billion, largely due to development investments in Ghana,
Peru and Nevada.
STATEMENTS OF CONSOLIDATED INCOME
Three Months Ended
December 31,
----------------------------
2004 2003
------------ ------------
(unaudited, in thousands,
except per share)
Revenues
Sales-gold, net $ 1,028,769 $ 773,405
Sales-base metals, net 201,273 32,441
1,230,042 805,846
Costs and expenses
Costs applicable to sales
(exclusive of depreciation,
depletion and amortization
shown separately below)
Gold 488,947 378,268
Base metals 99,478 14,057
Depreciation, depletion and
amortization 173,378 143,108
Exploration, research and development 53,416 32,499
General and administrative 35,899 43,636
Write-down of goodwill 51,750 --
Write-down of long-lived assets 13,400 29,884
Other (14,272) 17,073
901,996 658,525
Other income (expense)
Gain on investments, net 176 1,773
Gain (loss) on derivative
instruments, net 1,449 (1,866)
Loss on extinguishment of debt -- (14,302)
Royalty and dividend income 18,218 15,530
Interest income, foreign currency
exchange and other income 32,990 16,752
Interest, net (20,201) (17,208)
32,632 679
Pre-tax income before minority interest
and equity income of affiliates 360,678 148,000
Income tax (expense) benefit (74,644) 25,628
Minority interest in income
of subsidiaries (104,945) (42,457)
Equity income of affiliates 534 21,960
Net income $ 181,623 $ 153,131
Net income per common share,
basic and diluted $ 0.41 $ 0.36
Basic weighted-average common
shares outstanding 444,641 426,498
Diluted weighted-average common
shares outstanding 448,012 430,944
STATEMENTS OF CONSOLIDATED INCOME
Year Ended
December 31,
----------------------------
2004 2003
------------ ------------
(unaudited, in thousands,
except per share)
Revenues
Sales -- gold, net $ 3,653,563 $ 3,082,936
Sales -- base metals, net 870,622 74,820
4,524,185 3,157,756
Costs and expenses
Costs applicable to sales
(exclusive of depreciation,
depletion and amortization
shown separately below)
Gold 1,935,863 1,655,989
Base metals 367,367 44,273
Depreciation, depletion and
amortization 696,522 564,481
Exploration, research and development 192,409 115,238
General and administrative 115,848 130,292
Write-down of goodwill 51,750 --
Write-down of long-lived assets 39,265 35,260
Other 34,433 49,506
3,433,457 2,595,039
Other income (expense)
(Loss) gain on investments, net (39,019) 83,166
Gain on derivative instruments, net 2,356 22,876
Gain on extinguishment of NYOL
liabilities, net -- 220,537
Loss on extinguishment of debt (222) (33,832)
Royalty and dividend income 65,824 56,319
Interest income, foreign currency
exchange and other income 76,948 102,182
Interest, net (97,610) (88,579)
8,277 362,669
Pre-tax income before minority interest,
equity income and equity loss and
impairment of affiliates and cumulative
effect of a change in accounting
principle 1,099,005 925,386
Income tax expense (284,682) (206,950)
Minority interest in income
of subsidiaries (335,299) (173,178)
Equity loss and impairment of
Australian Magnesium Corporation -- (119,485)
Equity income of affiliates 2,641 84,427
Income before cumulative effect of a
change in accounting principle 481,665 510,200
Cumulative effect of a change in
accounting principle, net (47,138) (34,533)
Net income $ 434,527 $ 475,667
Income before cumulative effect of
a change in accounting principle
per common share, basic $ 1.09 $ 1.24
Cumulative effect of a change
in accounting principle
per common share, basic (0.11) (0.08)
Net income per common share, basic $ 0.98 $ 1.16
Basic weighted-average common
shares outstanding 443,463 410,600
Diluted weighted-average common
shares outstanding 446,511 413,723
CONSOLIDATED BALANCE SHEETS
At December 31,
----------------------------
2004 2003
------------ ------------
(unaudited, in thousands)
ASSETS
Cash and cash equivalents $ 1,567,181 $ 1,314,022
Marketable securities and other
short-term investments 158,687 274,593
Trade receivables 79,516 20,055
Accounts receivable 130,961 70,631
Inventories 264,374 225,719
Stockpiles and ore on leach pads 231,626 248,625
Deferred stripping costs 44,545 60,086
Deferred income tax assets 173,588 45,034
Other current assets 70,671 100,280
Current assets 2,721,149 2,359,045
Property, plant and mine
development, net 5,360,892 3,715,457
Investments 386,173 733,977
Deferred stripping costs 79,753 30,293
Long-term stockpiles and ore
on leach pads 524,831 305,810
Deferred income tax assets 482,908 404,020
Other long-term assets 180,247 106,995
Goodwill 3,025,935 3,042,557
Total assets $ 12,761,888 $ 10,698,154
LIABILITIES
Current portion of long-term debt $ 285,477 $ 190,866
Accounts payable 230,976 163,164
Employee-related benefits 134,524 136,301
Other current liabilities 450,028 352,202
Current liabilities 1,101,005 842,533
Long-term debt 1,311,260 886,633
Reclamation and remediation liabilities 431,500 362,283
Deferred revenue from sale
of future production 46,841 53,841
Deferred income tax liabilities 476,134 272,603
Employee-related benefits 249,754 253,726
Advanced stripping costs 102,831 --
Other long-term liabilities 338,643 295,082
Total liabilities 4,057,968 2,966,701
Minority interest in subsidiaries 775,060 346,518
STOCKHOLDERS' EQUITY
Total stockholders' equity 7,928,860 7,384,935
Total liabilities and
stockholders' equity $ 12,761,888 $ 10,698,154
STATEMENTS OF CONSOLIDATED CASH FLOWS
Three Months Ended
December 31,
----------------------------
2004 2003
------------ ------------
(unaudited, in thousands)
Operating activities:
Net income $ 181,623 $ 153,131
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion and
amortization 173,378 143,108
Accretion of accumulated
reclamation obligations 6,149 5,491
Amortization of deferred
stripping costs, net (4,328) (6,784)
Deferred income taxes (20,242) (51,274)
Foreign currency exchange gain (14,228) (26,150)
Minority interest expense 104,945 42,457
Equity income and impairment of
affiliates, net of dividends (313) (21,227)
Write-down of inventories,
stockpiles and ore on leach pads 13,641 4,512
Write-down of goodwill 51,750 --
Write-down of long-lived assets 13,400 29,884
Loss (gain) on investments, net (176) (1,773)
(Gain) loss on derivative
instruments, net (1,449) 1,866
(Gain) loss on guarantee of QMC debt (10,616) 30,000
Loss on extinguishment of debt -- 14,302
Loss (gain) on asset sales, net 582 (12,495)
Other operating adjustments (34,837) 1,494
(Increase) decrease in operating assets:
Accounts receivable 90,323 1,079
Inventories, stockpiles and ore
on leach pads (27,875) (53,704)
Other assets 11,779 (7,955)
Increase (decrease) in operating liabilities:
Accounts payable and other
accrued liabilities 68,227 (32,974)
Early settlement of derivative
instruments classified as
cash flow hedges -- (185)
Reclamation liabilities (14,706) (8,900)
Net cash provided by operating activities 587,027 203,903
Investing activities:
Additions to property, plant and
mine development (198,051) (138,350)
Investments in marketable
equity securities (4,966) (6,405)
Receipts from joint ventures and
affiliates, net 1,002 23,110
Proceeds from sale of investments 1,978 --
Proceeds from sale of assets 28,655 3,997
Early settlement of ineffective
derivative instruments -- 185
Investment in affiliates -- (13,848)
Funding of QMC loan receivable (23,163) --
Other (8,884) (4,422)
Net cash used in investing activities (203,429) (135,733)
Financing activities:
Proceeds from debt 18,206 363
Repayments of debt (112,623) (323,584)
Dividends paid on common stock (44,574) (22,064)
Dividends paid to minority interest (142,430) (65,677)
Proceeds from stock issuance 44,153 1,231,903
Change in restricted cash and other (1,308) --
Net cash (used in) provided by
financing activities (238,576) 820,941
Effect of exchange rate changes
on cash gain 5,155 5,500
Net change in cash and cash equivalents 150,177 894,611
Cash and cash equivalents at
beginning of period 1,417,004 419,411
Cash and cash equivalents at
end of period $ 1,567,181 $ 1,314,022
Supplemental information:
Income taxes paid, net of refunds $ 63,707 $ 49,140
Interest paid $ 28,864 $ 25,753
STATEMENTS OF CONSOLIDATED CASH FLOWS
Year Ended December 31,
----------------------------
2004 2003
------------ ------------
(unaudited, in thousands)
Operating activities:
Net income $ 434,527 $ 475,667
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation, depletion and
amortization 696,522 564,481
Accretion of accumulated reclamation
obligations 25,535 22,610
Amortization of deferred stripping
costs, net 4,093 (36,497)
Deferred income taxes 33,587 (36,183)
Foreign currency exchange gain (9,213) (96,971)
Minority interest expense 335,299 173,178
Equity loss (income) and impairment
of affiliates, net of dividends (930) 42,467
Write-down of inventories, stockpiles
and ore on leach pads 32,786 24,945
Write-down of long-lived assets 39,265 35,260
Write-down of goodwill 51,750 --
Cumulative effect of a change in
accounting principle, net 47,138 34,533
Loss (gain) on investments, net 39,019 (83,166)
Gain on derivative instruments, net (2,356) (22,876)
Gain on extinguishment of NYOL
liabilities, net -- (220,537)
(Gain) loss on guarantee of QMC debt (10,616) 30,000
Loss on extinguishment of debt 222 33,832
Gain on asset sales, net (28,004) (15,394)
Other operating adjustments (58,814) (9,079)
(Increase) decrease in operating assets:
Accounts receivable 68,990 5,859
Inventories, stockpiles and ore
on leach pads (23,257) (72,828)
Other assets (1,372) (5,052)
Increase (decrease) in operating liabilities:
Accounts payable and other
accrued liabilities (69,722) (19,096)
Early settlement of derivative
instruments classified as
cash flow hedges -- (118,776)
Reclamation liabilities (47,697) (21,990)
Net cash provided by
operating activities 1,556,752 684,387
Investing activities:
Additions to property, plant
and mine development (717,961) (504,535)
Investments in marketable
equity securities (224,170) (6,405)
Receipts from joint ventures
and affiliates, net 1,002 39,321
Proceeds from sale of investments 4,830 412,190
Proceeds from sale of assets 51,200 5,610
Early settlement of ineffective
derivative instruments 7,775 (57,556)
Investment in affiliates -- (70,072)
Cash recorded upon consolidation
of Batu Hijau 82,203 --
Cash consideration for acquisitions -- (11,195)
Funding of QMC loan receivable (23,163) --
Other (12,408) (4,422)
Net cash used in investing activities (830,692) (197,064)
Financing activities:
Proceeds from debt 55,921 492,841
Repayments of debt (253,711) (1,162,167)
Dividends paid on common stock (133,300) (70,759)
Dividends paid to minority interest (236,917) (145,950)
Proceeds from stock issuance 77,531 1,286,751
Change in restricted cash and other 15,260 --
Net cash (used in) provided by
financing activities (475,216) 400,716
Effect of exchange rate changes
on cash gain 2,315 24,300
Net change in cash and cash equivalents 253,159 912,339
Cash and cash equivalents at
beginning of year 1,314,022 401,683
Cash and cash equivalents at
end of year $ 1,567,181 $ 1,314,022
Supplemental information:
Income taxes paid, net of refunds $ 278,400 $ 194,297
Interest paid $ 92,100 $ 123,166
OPERATING STATISTICS SUMMARY
North America South America
--------------------------- ---------------------------
Three Months Ended December 31, 2004 2003 2004 2003
------------ ------------ ------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 256 $ 229 $ 125 $ 125
Capitalized mining and other 5 (15) (6) (3)
Cash operating costs 261 214 119 122
Royalties and production taxes 6 4 6 6
Total cash costs (5) 267 218 125 128
Reclamation and mine
closure costs 2 (7) 3 4
Total costs applicable to sales 269 211 128 132
Depreciation and amortization 49 65 60 60
Total production costs (5) $ 318 $ 276 $ 188 $ 192
Consolidated gold sales
(000 ounces) 780.7 731.9 854.7 674.0
Equity gold sales (000 ounces) 746.2 731.9 440.9 351.9
OPERATING STATISTICS SUMMARY
Australia/New Zealand(1) Indonesia(2)
--------------------------- ---------------------------
Three Months Ended December 31, 2004 2003 2004 2003
------------ ------------ ------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 276 $ 216 $ 144 $ 374
Capitalized mining and other (10) (10) (29) 3
Cash operating costs 266 206 115 377
Royalties and production taxes 14 18 9 6
Total cash costs (5) 280 224 124 383
Reclamation and mine
closure costs 3 -- 1 12
Total costs applicable to sales 283 224 125 395
Depreciation and amortization 67 60 44 156
Total production costs (5) $ 350 $ 284 $ 169 $ 551
Consolidated gold sales
(000 ounces) 477.0 477.4 178.9 11.7
Equity gold sales (000 ounces) 477.0 477.4 94.6 11.0
OPERATING STATISTICS SUMMARY
Central Asia(3) Equity Investments(4)
--------------------------- ---------------------------
Three Months Ended December 31, 2004 2003 2004 2003
------------ ------------ ------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 154 $ 148 -- --
Capitalized mining and other 3 (11) -- --
Cash operating costs 157 137 -- --
Royalties and production taxes -- 7 -- --
Total cash costs (5) 157 144 -- --
Reclamation and mine
closure costs 2 9 -- --
Total costs applicable to sales 159 153 -- --
Depreciation and amortization 55 60 -- --
Total production costs (5) $ 214 $ 213 -- --
Consolidated gold sales
(000 ounces) 39.2 76.7 -- --
Equity gold sales (000 ounces) 39.2 76.7 -- 66.2
OPERATING STATISTICS SUMMARY
Total
----------------------------
Three Months Ended December 31, 2004 2003
------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 221 $ 199
Capitalized mining and other (4) (10)
Cash operating costs 217 189
Royalties and production taxes 9 8
Total cash costs (5) 226 197
Reclamation and mine
closure costs 2 (1)
Total costs applicable to sales 228 196
Depreciation and amortization 56 63
Total production costs (5) $ 284 $ 259
Consolidated gold sales
(000 ounces) 2,330.5 1,971.7
Equity gold sales (000 ounces) 1,797.9 1,715.1
Average realized price
per equity ounce $ 436 $ 394
Copper Summary (6)
Equity copper production
(000 pounds) 104,258 92,909
Equity copper sales
(000 pounds) 100,712 107,225
Total cash cost
per equity pound $ 0.70 $ 0.67
Average realized price
per equity pound $ 1.38 $ 0.96
(1) Includes 3,800 and 3,000 ounces from the wholly-owned Golden Grove
zinc/copper mine in 2004 and 2003, respectively. Golden Grove is excluded
from the cash cost per ounce calculations.
(2) Indonesia includes Batu Hijau in 2004 and Minahasa in 2003.
(3) Central Asia/Europe includes Zarafshan (Uzbekistan) and Ovacik (Turkey)
(4) Equity investments comprise Batu Hijau, TVX Newmont Americas and Echo Bay
Mines Limited.
(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.
(6) Represents both Batu Hijau and Golden Grove except total cash cost and
average realized price per equity pound for 2003 are only Golden Grove.
OPERATING STATISTICS SUMMARY
North America South America
--------------------------- ---------------------------
Year Ended December 31, 2004 2003 2004 2003
------------ ------------ ------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 293 $ 244 $ 137 $ 125
Capitalized mining and other (20) (17) (7) (4)
Cash operating costs 273 227 130 121
Royalties and production taxes 5 6 7 5
Total cash costs (5) 278 233 137 126
Reclamation and mine
closure costs 2 1 2 3
Total costs applicable to sales 280 234 139 129
Depreciation and amortization 56 61 70 60
Total production costs (5) $ 336 $ 295 $ 209 $ 189
Consolidated gold sales
(000 ounces) 2,834.2 2,902.6 3,064.5 3,038.8
Equity gold sales (000 ounces) 2,712.2 2,902.6 1,582.7 1,626.4
OPERATING STATISTICS SUMMARY
Australia/New Zealand(1) Indonesia(2)
--------------------------- ---------------------------
Year Ended December 31, 2004 2003 2004 2003
------------ ------------ ------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 259 $ 227 $ 131 $ 240
Capitalized mining and other (1) (7) 8 3
Cash operating costs 258 220 139 243
Royalties and production taxes 14 14 9 6
Total cash costs (5) 272 234 148 249
Reclamation and mine
closure costs 3 1 1 5
Total costs applicable to sales 275 235 149 254
Depreciation and amortization 67 60 39 78
Total production costs (5) $ 342 $ 295 $ 188 $ 332
Consolidated gold sales
(000 ounces) 1,906.9 2,030.1 789.9 98.1
Equity gold sales (000 ounces) 1,906.9 2,011.5 466.5 92.2
OPERATING STATISTICS SUMMARY
Central Asia(3) Equity Investments(4)
--------------------------- ---------------------------
Year Ended December 31, 2004 2003 2004 2003
------------ ------------ ------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 168 $ 137 -- --
Capitalized mining and other (6) (3) -- --
Cash operating costs 162 134 -- --
Royalties and production taxes 4 5 -- --
Total cash costs (5) 166 139 -- --
Reclamation and mine
closure costs 2 3 -- --
Total costs applicable to sales 168 142 -- --
Depreciation and amortization 81 62 -- --
Total production costs (5) $ 249 $ 204 -- --
Consolidated gold sales
(000 ounces) 320.1 386.3 -- --
Equity gold sales (000 ounces) 320.1 386.3 -- 364.6
OPERATING STATISTICS SUMMARY
Total
----------------------------
Year Ended December 31, 2004 2003
------------ ------------
Production Costs Per Ounce:
Direct mining and
production costs $ 232 $ 205
Capitalized mining and other (9) (10)
Cash operating costs 223 195
Royalties and production taxes 8 8
Total cash costs (5) 231 203
Reclamation and mine
closure costs 2 2
Total costs applicable to sales 233 205
Depreciation and amortization 62 61
Total production costs (5) $ 295 $ 266
Consolidated gold sales
(000 ounces) 8,915.6 8,455.9
Equity gold sales (000 ounces) 6,988.4 7,383.6
Average realized price
per equity ounce $ 412 $ 366
Copper Summary (6)
Equity copper production
(000 pounds) 438,194 414,493
Equity copper sales
(000 pounds) 422,268 417,681
Total cash cost
per equity pound $ 0.63 $ 0.59
Average realized price
per equity pound $ 1.33 $ 0.86
(1) Includes 19,300 and 13,400 ounces from the wholly-owned Golden Grove
zinc/copper mine in 2004 and 2003, respectively. Golden Grove is excluded
from the cash cost per ounce calculations.
(2) Indonesia includes Batu Hijau and Minahasa in 2004 and Minahasa in 2003.
(3) Central Asia/Europe includes Zarafshan (Uzbekistan) and Ovacik (Turkey)
(4) Equity investments comprise Batu Hijau, TVX Newmont Americas and Echo Bay
Mines Limited.
(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.
(6) Represents both Batu Hijau and Golden Grove except total cash cost and
average realized price per equity pound for 2003 are only Golden Grove.
2005 Guidance
Equity Gold Total
Sales Cash Costs
(000 oz) ($/oz)
------------ ------------
North America
Nevada 2,570 $ 285
Golden Giant 160 $ 305
Holloway 85 $ 355
La Herradura 80 $ 150
Sub-total 2,895 $ 285
South America
Yanacocha 1,500 $ 135
Kori Kollo 85 $ 150
Sub-total 1,585 $ 135
Australia(1)/New Zealand
Kalgoorlie 440 $ 335
Pajingo 205 $ 250
Tanami 475 $ 295
Yandal 325 $ 300
Martha 140 $ 225
Sub-total 1,585 $ 295
Indonesia
Batu Hijau 430 $ 145
Central Asia
Zarafshan 150 $ 215
TOTAL (2) 6,600-6,800 $235-$245
Equity
Copper & Total
Zinc Sales Cash Costs
(million lbs) ($/lb)
------------- -----------
Batu Hijau - Copper 330-360 $0.58-$0.64
Golden Grove - Copper 40-50 $1.00-$1.05
Golden Grove - Zinc 200-220 $0.30-$0.35
Consolidated Financial (in millions, except tax rate)
Royalty and dividend income $55-$65
Depreciation, depletion
& amortization $700-$730
Exploration, research and
development $170-$200
- Exploration $140-$160
- Advanced projects $20-$25
- Research, development
and other $10-$15
General and administrative $115-$125
Interest expense, net $90-$95
Tax rate (assuming $425/oz gold) 25%-30%
Capital expenditures $1,200-$1,325
Notes:
1. Total cash costs are based on an A$1 = $0.75 exchange rate assumption.
2. Excludes Golden Grove by-product sales of approximately 55,000 ounces.
Supplemental Information
1. Gold Production Summary -- Americas
Nevada Canada (1)
------------------- -------------------
Three Months Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons):
Open-Pit 48,308 44,990 n/a n/a
Underground 452 477 261 265
Tons Milled/Processed (000):
Oxide 1,436 1,119 265 285
Refractory 2,444 2,264 n/a n/a
Leach 5,085 5,757 n/a n/a
Average Ore Grade (oz/ ton):
Oxide 0.113 0.126 0.231 0.319
Refractory 0.217 0.228 n/a n/a
Leach 0.034 0.026 n/a n/a
Average Mill Recovery Rate:
Oxide 79.3% 77.3% 94.4% 95.6%
Refractory 91.6% 90.5% n/a n/a
Ounces Produced (000) 703.6 701.5 60.6 85.6
Equity Ounces Produced (000):
Oxide 130.9 118.6 60.6 85.6
Refractory 453.5 473.3 n/a n/a
Leach 84.7 109.6 n/a n/a
Total 669.1 701.5 60.6 85.6
Equity Ounces Sold (000) 668.2 625.7 60.6 82.9
Production Costs Per Ounce:
Direct mining and
production costs $ 253 $ 235 $ 320 $ 209
Capitalized mining and other 6 (18) 1 --
Cash operating costs 259 217 321 209
Royalties and production taxes 6 4 2 3
Total cash costs 265 221 323 212
Reclamation and mine
closure costs 2 (9) 2 3
Total costs applicable to sales 267 212 325 215
Depreciation and amortization 47 60 77 102
Total production costs $ 314 $ 272 $ 402 $ 317
Other (2) Yanacocha, Peru
------------------- -------------------
Three Months Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons):
Open-Pit 3,049 2,778 45,112 50,173
Underground n/a n/a n/a n/a
Tons Milled/Processed (000):
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Leach 1,038 968 31,435 31,958
Average Ore Grade (oz/ ton):
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Leach 0.025 0.026 0.029 0.024
Average Mill Recovery Rate:
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Ounces Produced (000) 17.4 22.3 847.3 667.2
Equity Ounces Produced (000):
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Leach 17.4 22.3 435.1 342.7
Total 17.4 22.3 435.1 342.7
Equity Ounces Sold (000) 17.4 23.3 436.0 337.9
Production Costs Per Ounce:
Direct mining and
production costs $ 139 $ 170 $ 124 $ 123
Capitalized mining and other (23) (3) (6) (3)
Cash operating costs 116 167 118 120
Royalties and production taxes -- 4 6 6
Total cash costs 116 171 124 126
Reclamation and mine
closure costs 2 2 2 4
Total costs applicable to sales 118 173 126 130
Depreciation and amortization 64 48 60 59
Total production costs $ 182 $ 221 $ 186 $ 189
Kori Kollo, Bolivia
-------------------
Three Months Ended December 31, 2004 2003
- --------------------------------- -------- --------
Tons Mined (000 dry short tons):
Open-Pit n/a --
Underground n/a n/a
Tons Milled/Processed (000):
Oxide n/a n/a
Refractory n/a 159
Leach n/a --
Average Ore Grade (oz/ ton):
Oxide n/a n/a
Refractory n/a 0.026
Leach n/a --
Average Mill Recovery Rate:
Oxide n/a n/a
Refractory n/a 39.2%
Ounces Produced (000) 5.7 14.8
Equity Ounces Produced (000):
Oxide n/a n/a
Refractory n/a 4.8
Leach 5.0 8.1
Total 5.0 12.9
Equity Ounces Sold (000) 4.9 14.0
Production Costs Per Ounce:
Direct mining and
production costs $ 226 $ 179
Capitalized mining and other (23) (14)
Cash operating costs 203 165
Royalties and production taxes 18 --
Total cash costs 221 165
Reclamation and mine
closure costs 48 21
Total costs applicable to sales 269 186
Depreciation and amortization 59 74
Total production costs $ 328 $ 260
(1) Includes Golden Giant and Holloway
(2) Other includes La Herradura and for 2003, La Herradura and Mesquite
Nevada Canada (1)
------------------- -------------------
Year Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons):
Open-Pit 192,821 176,254 n/a n/a
Underground 1,574 1,733 1,001 1,191
Tons Milled/Processed (000):
Oxide 4,626 2,914 1,004 1,228
Refractory 8,985 9,129 n/a n/a
Leach 19,297 18,376 n/a n/a
Average Ore Grade (oz/ ton):
Oxide 0.125 0.140 0.232 0.260
Refractory 0.199 0.219 n/a n/a
Leach 0.027 0.028 n/a n/a
Average Mill Recovery Rate:
Oxide 79.1% 80.8% 94.3% 95.3%
Refractory 90.8% 90.6% n/a n/a
Ounces Produced (000) 2,460.4 2,560.7 224.7 297.8
Equity Ounces Produced (000):
Oxide 461.2 336.0 224.7 297.8
Refractory 1,544.8 1,834.2 n/a n/a
Leach 332.5 390.5 n/a n/a
Total 2,338.5 2,560.7 224.7 297.8
Equity Ounces Sold (000) 2,416.0 2,490.8 227.4 294.8
Production Costs Per Ounce:
Direct mining and
production costs $ 295 $ 248 $ 314 $ 241
Capitalized mining and other (22) (20) 2 2
Cash operating costs 273 228 316 243
Royalties and production taxes 5 7 2 3
Total cash costs 278 235 318 246
Reclamation and mine
closure costs 3 -- 1 6
Total costs applicable to sales 281 235 319 252
Depreciation and amortization 52 57 81 93
Total production costs $ 333 $ 292 $ 400 $ 345
Other (2) Yanacocha, Peru
------------------- -------------------
Year Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons):
Open-Pit 11,557 11,696 193,407 204,889
Underground n/a n/a n/a n/a
Tons Milled/Processed (000):
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Leach 4,149 4,035 133,514 145,275
Average Ore Grade (oz/ ton):
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Leach 0.026 0.026 0.025 0.027
Average Mill Recovery Rate:
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Ounces Produced (000) 68.8 116.0 3,017.3 2,851.1
Equity Ounces Produced (000):
Oxide n/a n/a n/a n/a
Refractory n/a n/a n/a n/a
Leach 68.8 116.0 1,549.4 1,464.1
Total 68.8 116.0 1,549.4 1,464.1
Equity Ounces Sold (000) 68.8 117.0 1,561.0 1,467.9
Production Costs Per Ounce:
Direct mining and
production costs $ 153 $ 169 $ 135 $ 118
Capitalized mining and other (7) (4) (6) (4)
Cash operating costs 146 165 129 114
Royalties and production taxes -- 6 6 6
Total cash costs 146 171 135 120
Reclamation and mine
closure costs 1 3 2 2
Total costs applicable to sales 147 174 137 122
Depreciation and amortization 73 62 70 62
Total production costs $ 220 $ 236 $ 207 $ 184
Kori Kollo, Bolivia
-------------------
Year Ended December 31, 2004 2003
- --------------------------------- -------- --------
Tons Mined (000 dry short tons):
Open-Pit n/a 7,638
Underground n/a n/a
Tons Milled/Processed (000):
Oxide n/a n/a
Refractory n/a 5,559
Leach n/a 3,696
Average Ore Grade (oz/ ton):
Oxide n/a n/a
Refractory n/a 0.036
Leach n/a 0.017
Average Mill Recovery Rate:
Oxide n/a n/a
Refractory n/a 61.7%
Ounces Produced (000) 25.2 176.2
Equity Ounces Produced (000):
Oxide n/a n/a
Refractory n/a 112.9
Leach 22.2 42.1
Total 22.2 155.0
Equity Ounces Sold (000) 21.7 158.5
Production Costs Per Ounce:
Direct mining and
production costs $ 257 $ 197
Capitalized mining and other (13) (13)
Cash operating costs 244 184
Royalties and production taxes 16 --
Total cash costs 260 184
Reclamation and mine
closure costs 43 13
Total costs applicable to sales 303 197
Depreciation and amortization 94 38
Total production costs $ 397 $ 235
(1) Includes Golden Giant and Holloway
(2) Other includes La Herradura and for 2003, La Herradura and Mesquite
2. Gold Production Summary -- Australia/New Zealand
Pajingo Yandal (1)
------------------- -------------------
Three Months Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) 181 185 662 1,765
Tons Milled/Processed (000) 208 194 624 1,226
Average Ore Grade (oz/ton) 0.343 0.472 0.155 0.143
Average Mill Recovery Rate 96.3% 96.8% 93.4% 92.5%
Ounces Produced (000) 69.5 82.2 88.5 157.2
Equity Ounces Produced (000) 69.5 82.2 88.5 157.2
Equity Ounces Sold (000) 69.4 71.6 88.3 132.6
Production Costs Per Ounce:
Direct mining and production costs $ 225 $ 132 $ 249 $ 238
Capitalized mining and other (6) (4) (1) (10)
Cash operating costs 219 128 248 228
Royalties and production taxes 13 16 11 12
Total cash costs 232 144 259 240
Reclamation and mine closure costs 1 (1) 3 (1)
Total costs applicable to sales 233 143 262 239
Depreciation and amortization 136 119 59 42
Total production costs $ 369 $ 262 $ 321 $ 281
Tanami Kalgoorlie
------------------- -------------------
Three Months Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) 492 4,466 11,431 13,061
Tons Milled/Processed (000) 1,157 1,087 1,870 1,844
Average Ore Grade (oz/ton) 0.142 0.157 0.069 0.071
Average Mill Recovery Rate 95.6% 95.6% 85.7% 87.8%
Ounces Produced (000) 156.3 161.9 124.2 112.0
Equity Ounces Produced (000) 156.3 161.9 124.2 112.0
Equity Ounces Sold (000) 152.2 139.3 123.1 95.5
Production Costs Per Ounce:
Direct mining and production costs $ 301 $ 214 $ 295 $ 258
Capitalized mining and other (1) (4) (9) (5)
Cash operating costs 300 210 286 253
Royalties and production taxes 22 34 11 12
Total cash costs 322 244 297 265
Reclamation and mine closure costs 2 -- 3 (4)
Total costs applicable to sales 324 244 300 261
Depreciation and amortization 58 61 36 30
Total production costs $ 382 $ 305 $ 336 $ 291
Martha
-----------------
Three Months Ended December 31, 2004 2003
- --------------------------------- -------- ------
Tons Mined (000 dry short tons) 518 1,431
Tons Milled/Processed (000) 349 367
Average Ore Grade (oz/ton) 0.121 0.106
Average Mill Recovery Rate 91.0% 91.1%
Ounces Produced (000) 39.3 35.7
Equity Ounces Produced (000) 39.3 35.7
Equity Ounces Sold (000) 40.2 35.4
Production Costs Per Ounce:
Direct mining and production costs $ 270 $ 197
Capitalized mining and other (69) (54)
Cash operating costs 201 143
Royalties and production taxes -- --
Total cash costs 201 143
Reclamation and mine closure costs 2 2
Total costs applicable to sales 203 145
Depreciation and amortization 93 93
Total production costs $ 296 $ 238
(1) 2004 includes Jundee. 2003 includes Jundee, Bronzewing and Wiluna.
Pajingo Yandal (1)
------------------- -------------------
Year Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) 652 761 6,982 4,496
Tons Milled/Processed (000) 809 792 2,821 5,236
Average Ore Grade (oz/ton) 0.300 0.450 0.133 0.123
Average Mill Recovery Rate 96.5% 96.8% 92.9% 91.0%
Ounces Produced (000) 241.1 340.5 354.7 590.8
Equity Ounces Produced (000) 241.1 340.5 354.7 590.8
Equity Ounces Sold (000) 251.4 330.3 379.3 565.6
Production Costs Per Ounce:
Direct mining and production costs $ 226 $ 124 $ 266 $ 261
Capitalized mining and other (7) (6) (1) 2
Cash operating costs 219 118 265 263
Royalties and production taxes 11 11 9 10
Total cash costs 230 129 274 273
Reclamation and mine closure costs 1 -- 5 2
Total costs applicable to sales 231 129 279 275
Depreciation and amortization 125 88 70 64
Total production costs $ 356 $ 217 $ 349 $ 339
Tanami Kalgoorlie
------------------- -------------------
Year Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) 11,654 20,395 45,459 49,290
Tons Milled/Processed (000) 4,525 4,533 7,142 7,171
Average Ore Grade (oz/ton) 0.149 0.145 0.072 0.071
Average Mill Recovery Rate 95.3% 96.0% 86.7% 85.9%
Ounces Produced (000) 640.0 629.6 453.2 421.2
Equity Ounces Produced (000) 640.0 610.4 453.2 421.2
Equity Ounces Sold (000) 658.0 588.6 468.4 404.7
Production Costs Per Ounce:
Direct mining and production costs $ 246 $ 222 $ 280 $ 256
Capitalized mining and other 11 (6) 7 (3)
Cash operating costs 257 216 287 253
Royalties and production taxes 24 24 10 10
Total cash costs 281 240 297 263
Reclamation and mine closure costs 1 1 4 2
Total costs applicable to sales 282 241 301 265
Depreciation and amortization 58 59 35 24
Total production costs $ 340 $ 300 $ 336 $ 289
Martha
-------------------
Year Ended December 31, 2004 2003
- --------------------------------- -------- --------
Tons Mined (000 dry short tons) 4,142 5,270
Tons Milled/Processed (000) 1,405 1,357
Average Ore Grade (oz/ton) 0.102 0.088
Average Mill Recovery Rate 90.4% 91.6%
Ounces Produced (000) 129.7 110.2
Equity Ounces Produced (000) 129.7 108.5
Equity Ounces Sold (000) 130.5 108.9
Production Costs Per Ounce:
Direct mining and production costs $ 292 $ 288
Capitalized mining and other (80) (89)
Cash operating costs 212 199
Royalties and production taxes -- --
Total cash costs 212 199
Reclamation and mine closure costs 3 2
Total costs applicable to sales 215 201
Depreciation and amortization 105 105
Total production costs $ 320 $ 306
(1) 2004 includes Jundee for the full year and Bronzewing for the first
quarter. 2003 includes Jundee, Bronzewing and Wiluna.
3. Gold Production Summary -- Indonesia and Central Asia
Batu Hijau, Minahasa,
Indonesia Indonesia
------------------- -------------------
Three Months Ended December 31, 2004 2003(1) 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) 63,548 56,798 n/a n/a
Tons Milled/Processed (000):
Leach n/a n/a n/a n/a
Mill 14,424 12,868 -- 153
Average Ore Grade (oz/ton) 0.014 0.011 -- 0.150
Average Mill Recovery Rate 80.6% 81.6% -- 90.3%
Ounces Produced (000) 172.7 120.1 -- 20.9
Equity Ounces Produced (000) 91.3 67.5 -- 19.6
Equity Ounces Sold (000) 94.6 66.2 -- 11.0
Production Costs Per Ounce:
Direct mining and production costs $ 144 $ 162 -- $ 374
Capitalized mining and other (29) (48) -- 3
Cash operating costs 115 114 -- 377
Royalties and production taxes 9 17 -- 6
Total cash costs 124 131 -- 383
Reclamation and mine closure costs 1 3 -- 12
Total costs applicable to sales 125 134 -- 395
Depreciation and amortization 44 58 -- 156
Total production costs $ 169 $ 192 -- $ 551
Zarafshan, Ovacik,
Uzbekistan Turkey
------------------- -------------------
Three Months Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) n/a n/a -- 1,914
Tons Milled/Processed (000):
Leach 1,965 1,964 n/a n/a
Mill n/a n/a -- 98
Average Ore Grade (oz/ton) 0.037 0.042 -- 0.376
Average Mill Recovery Rate n/a n/a -- 97.0%
Ounces Produced (000) 38.9 48.6 -- 36.5
Equity Ounces Produced (000) 38.9 48.6 -- 36.5
Equity Ounces Sold (000) 39.2 46.2 -- 30.5
Production Costs Per Ounce:
Direct mining and production costs $ 154 $ 140 -- $ 158
Capitalized mining and other 3 4 -- (30)
Cash operating costs 157 144 -- 128
Royalties and production taxes -- -- -- 16
Total cash costs 157 144 -- 144
Reclamation and mine closure costs 2 10 -- 6
Total costs applicable to sales 159 154 -- 150
Depreciation and amortization 55 47 -- 81
Total production costs $ 214 $ 201 -- $ 231
(1) 2003 cash and total cost per ounce have been presented on a pro forma
co-product basis for comparability to 2004.
Batu Hijau, Minahasa,
Indonesia Indonesia
------------------- -------------------
Year Ended December 31, 2004 2003(1) 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) 235,455 231,073 n/a n/a
Tons Milled/Processed (000):
Leach n/a n/a n/a n/a
Mill 54,243 49,819 441 697
Average Ore Grade (oz/ton) 0.016 0.015 0.158 0.156
Average Mill Recovery Rate 80.9% 80.9% 90.5% 91.0%
Ounces Produced (000) 718.8 600.8 63.8 99.3
Equity Ounces Produced (000) 398.5 337.9 59.9 93.3
Equity Ounces Sold (000) 396.3 328.9 70.2 92.2
Production Costs Per Ounce:
Direct mining and production costs $ 110 $ 140 $ 248 $ 240
Capitalized mining and other 9 (36) 3 3
Cash operating costs 119 104 251 243
Royalties and production taxes 9 17 8 6
Total cash costs 128 121 259 249
Reclamation and mine closure costs 1 4 4 5
Total costs applicable to sales 129 125 263 254
Depreciation and amortization 40 54 32 78
Total production costs $ 169 $ 179 $ 295 $ 332
Zarafshan, Ovacik,
Uzbekistan Turkey
------------------- -------------------
Year Ended December 31, 2004 2003 2004 2003
- --------------------------------- -------- -------- -------- --------
Tons Mined (000 dry short tons) n/a n/a 4,659 5,975
Tons Milled/Processed (000):
Leach 7,894 8,080 n/a n/a
Mill n/a n/a 331 533
Average Ore Grade (oz/ton) 0.042 0.043 0.320 0.343
Average Mill Recovery Rate n/a n/a 95.4% 94.3%
Ounces Produced (000) 205.0 218.7 104.8 172.6
Equity Ounces Produced (000) 205.0 218.7 104.8 172.6
Equity Ounces Sold (000) 210.1 218.1 110.0 168.2
Production Costs Per Ounce:
Direct mining and production costs $ 150 $ 145 $ 202 $ 127
Capitalized mining and other 2 2 (23) (11)
Cash operating costs 152 147 179 116
Royalties and production taxes -- -- 14 13
Total cash costs 152 147 193 129
Reclamation and mine closure costs 2 4 2 2
Total costs applicable to sales 154 151 195 131
Depreciation and amortization 49 46 143 82
Total production costs $ 203 $ 197 $ 338 $ 213
(1) 2003 cash and total cost per ounce have been presented on a pro forma
co-product basis for comparability to 2004.
4. Base Metal Summary -- Batu Hijau and Golden Grove
Three Months Ended Year Ended
December 31, December 31,
--------------------- ---------------------
Batu Hijau 2004 (1) 2003 (1) 2004 (1) 2003 (1)
- ------------------------- --------- --------- --------- ---------
Total tons mined (000) 63,548 56,798 235,455 231,073
Dry tons processed (000) 14,424 12,868 54,243 49,819
Average copper grade 0.67% 0.64% 0.75% 0.72%
Average recovery rate 84.7% 86.6% 87.8% 88.6%
Copper produced (000 lbs) 170,919 145,955 716,939 634,123
Equity copper produced
(000 lbs) 90,373 82,100 397,510 356,694
Equity copper sold
(000 lbs) 86,850 79,089 378,801 343,378
Realized copper price
per pound $ 1.39 $ 1.05 $ 1.33 $ 0.86
Total cash cost per
equity pound $ 0.65 $ 0.57 $ 0.60 $ 0.46
Noncash cost per
equity pound 0.15 0.17 0.14 0.14
Total production cost
per equity pound $ 0.80 $ 0.74 $ 0.74 $ 0.60
(1) 2003 cash and total cost per pound have been presented pro forma on a
co-product basis for comparability to 2004.
Three Months Ended Year Ended
December 31, December 31,
---------------------- ----------------------
Golden Grove 2004 2003 2004 2003
- ---------------------------- --------- --------- --------- ---------
Total tons mined (000) 356 393 1,404 1,457
Dry tons processed (000) 338 362 1,366 1,406
Average copper grade 3.07% 3.66% 3.12% 4.56%
Average copper recovery rate 90.5% 86.1% 88.1% 90.9%
Copper produced (000 lbs) 13,885 10,809 40,684 57,799
Copper sold (000 lbs) 13,862 28,136 43,467 74,303
Realized copper price
per pound $ 1.33 $ 0.96 $ 1.36 $ 0.86
Copper cash cost per pound $ 1.01 $ 0.67 $ 0.90 $ 0.59
Average zinc grade 14.36% 12.47% 10.45% 12.40%
Average zinc recovery rate 88.3% 88.3% 88.8% 89.9%
Zinc produced (000 lbs) 13,218 33,031 101,917 120,425
Zinc sold (000 lbs) 22,392 41,579 114,835 104,711
Realized zinc price
per pound $ 0.48 $ 0.39 $ 0.48 $ 0.43
Zinc cash cost per pound $ 0.35 $ 0.14 $ 0.38 $ 0.19
Gold sold (000 ounces) 3.8 3.0 19.3 13.4
Silver sold (000 ounces) 235.8 309.8 1,093.4 1,475.6
5. Reconciliation of Costs Applicable to Sales to Total Cash Cost Per Ounce and
Per Pound, and Total Production Costs Per Ounce and Per Pound (dollars in
millions except per ounce amounts)
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.
Total
Three Months Ended Golden La North
December 31, Nevada Giant Holloway Canada Herradura America
---------- ---------- ---------- ---------- ---------- ----------
Costs applicable
to sales under
GAAP $ 190.6 $ 12.8 $ 6.8 $ 19.6 $ 2.0 $ 212.2
Minority
interest -- -- -- -- -- --
Accretion
expense (1.4) (0.1) -- (0.1) -- (1.5)
Write-down
of inventories -- -- -- -- -- --
Purchased ore
and other (11.9) -- -- -- -- (11.9)
Total cash cost
for per ounce
calculations 177.3 12.7 6.8 19.5 2.0 198.8
Accretion
expense
and other 1.4 0.1 -- 0.1 -- 1.5
Depreciation,
depletion and
amortization 31.1 2.2 2.5 4.7 1.1 36.9
Minority
interest
and other -- -- -- -- -- --
Total production
cost for per
ounce
calculations $ 209.8 $ 15.0 $ 9.3 $ 24.3 $ 3.1 $ 237.2
Equity ounces
sold (000) 668.2 41.6 19.0 60.6 17.4 746.2
Equity cash
cost per
ounce sold $ 265 $ 307 $ 360 $ 323 $ 116 $ 267
Equity total
production cost
per ounce sold $ 314 $ 362 $ 491 $ 402 $ 182 $ 318
Three Months Ended
December 31, Kori South
2004 Yanacocha Kollo America Pajingo Yandal Tanami
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under GAAP $ 111.9 $ 1.5 $ 113.4 $ 16.3 $ 23.1 $ 53.5
Minority
interest (57.3) (0.2) (57.5) -- -- --
Accretion
expense (0.8) (0.2) (1.0) (0.1) (0.3) (0.3)
Write-down
of inventories -- -- -- (0.1) -- (4.2)
Purchased ore
and other 0.4 -- 0.4 -- -- --
Total cash cost
for per ounce
calculations 54.2 1.1 55.3 16.1 22.8 49.0
Accretion
expense and
other 0.8 0.2 1.0 0.1 0.3 0.3
Depreciation,
depletion and
amortization 46.8 0.3 47.1 9.5 5.2 8.8
Minority
interest and
other (20.7) -- (20.7) -- -- --
Total production
cost for per
ounce
calculations $ 81.1 $ 1.6 $ 82.7 $ 25.7 $ 28.3 $ 58.1
Equity ounces
sold (000) 436.0 4.9 440.9 69.4 88.3 152.2
Equity cash cost
per ounce sold $ 124 $ 221 $ 125 $ 232 $ 259 $ 322
Equity total
production cost
per ounce sold $ 186 $ 328 $ 188 $ 369 $ 321 $ 382
Three Months Ended Australia/
December 31, New Batu
2004 Kalgoorlie Martha Zealand Hijau Minahasa Indonesia
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under
GAAP $ 37.0 $ 8.2 $ 138.1 $ 22.2 $ 0.1 $ 22.3
Minority
interest -- -- -- (10.9) -- (10.9)
Accretion
expense (0.4) (0.1) (1.2) (0.1) -- (0.1)
Write-down
of inventories -- -- (4.3) -- -- --
Purchased ore
and other -- -- -- 0.5 -- 0.5
Total cash cost
for per ounce
calculations 36.6 8.1 132.6 11.7 0.1 11.8
Accretion
expense
and other 0.4 0.1 1.2 0.1 -- 0.1
Depreciation,
depletion and
amortization 4.4 3.7 31.6 7.9 -- 7.9
Minority
interest
and other -- -- -- (3.7) -- (3.7)
Total production
cost for per
ounce
calculations $ 41.4 $ 11.9 $ 165.4 $ 16.0 0.1 $ 16.1
Equity ounces
sold (000) 123.1 40.2 473.2 94.6 -- 94.6
Equity cash
cost per
ounce sold $ 297 $ 201 $ 280 $ 124 -- $ 124
Equity total
production
cost per
ounce sold $ 336 $ 296 $ 350 $ 169 -- $ 169
Three Months Ended Central
December 31, 2004 Zarafshan Ovacik Asia Total Gold
---------- ---------- ---------- ----------
Costs applicable
to sales under GAAP $ 6.2 $ 0.1 $ 6.3 $ 492.3
Minority interest -- -- -- (68.4)
Accretion expense (0.1) (0.1) (0.2) (4.0)
Write-down of
inventories -- -- -- (4.3)
Purchased ore and other -- -- -- (11.0)
Total cash cost for
per ounce calculations 6.1 -- 6.1 404.6
Accretion expense
and other 0.1 0.1 0.2 4.0
Depreciation,
depletion and
amortization 2.1 2.9 5.0 128.5
Minority interest
and other -- (2.9) (2.9) (27.3)
Total production
cost for per ounce
calculations $ 8.3 $ 0.1 $ 8.4 $ 509.8
Equity ounces sold
(000) (1) 39.2 -- 39.2 1,794.1
Equity cash cost per
ounce sold $ 157 -- $ 157 $ 226
Equity total production
cost per ounce sold $ 214 -- $ 214 $ 284
(1) Excludes 3.8 ounces from Golden Grove.
Three Months Ended
December 31, Golden La
2003 Nevada Giant Holloway Canada Mesquite Herradura
---------- ---------- ---------- ---------- ---------- ----------
Costs applicable
to sales under
GAAP $ 141.7 $ 12.4 $ 5.4 $ 17.8 $ 1.7 $ 2.3
Minority
interest -- -- -- -- -- --
Accretion
expense 4.9 (0.1) (0.1) (0.2) --
--
Write-down of
inventories -- -- -- -- -- --
Purchased ore
and other (21.1) -- -- -- -- --
Total cash cost
for per ounce
calculations 125.5 12.3 5.3 17.6 1.7 2.3
Accretion
expense and
other (4.9) 0.1 0.1 0.2 -- --
Depreciation,
depletion and
amortization 34.3 7.0 1.5 8.5 0.3 0.9
Minority
interest
and other -- -- -- -- -- --
Total production
cost for per
ounce
calculations $ 154.9 $ 19.4 $ 6.9 $ 26.3 $ 2.0 $ 3.2
Equity ounces
sold (000) 625.7 67.9 15.0 82.9 6.4 16.9
Equity cash
cost per
ounce sold $ 221 $ 181 $ 353 $ 212 $ 259 $ 137
Equity total
production
cost per
ounce sold $ 272 $ 286 $ 460 $ 317 $ 306 $ 188
Three Months Ended
December 31, North Kori South
2003 America Yanacocha Kollo America Pajingo Yandal
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under
GAAP $ 163.5 $ 88.2 $ 3.0 $ 91.2 $ 10.4 $ 31.9
Minority
interest -- (44.8) (0.3) (45.1) -- --
Accretion
expense 4.7 (0.9) (0.3) (1.2) -- 0.1
Write-down
of
inventories -- -- -- -- -- (0.3)
Purchased ore
and other (21.1) -- -- -- -- --
Total cash cost
for per ounce
calculations 147.1 42.5 2.4 44.9 10.4 31.7
Accretion
expense
and other (4.7) 0.9 0.3 1.2 (0.1) (0.1)
Depreciation,
depletion and
amortization 44.0 36.0 1.2 37.2 8.5 5.6
Minority
interest
and other -- (15.8) (0.1) (15.9) -- --
Total production
cost for per
ounce
calculations $ 186.4 $ 63.6 $ 3.8 $ 67.4 $ 18.8 $ 37.2
Equity ounces
sold (000) 731.9 337.9 14.0 351.9 71.6 132.6
Equity cash
cost per
ounce sold $ 218 $ 126 $ 165 $ 128 $ 144 $ 240
Equity total
production
cost per
ounce sold $ 276 $ 189 $ 260 $ 192 $ 262 $ 281
Three Months Ended Australia/
December 31, New
2003 Tanami Kalgoorlie Martha Zealand Minahasa Zarafshan
- ------------------ ---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under
GAAP $ 34.3 $ 25.0 $ 5.2 $ 106.8 $ 4.6 $ 7.2
Minority
interest -- -- -- -- -- --
Accretion
expense (0.4) 0.3 (0.1) (0.1) (0.1) (0.5)
Write-down
of inventories -- -- -- (0.3) -- --
Purchased ore
and other -- -- -- -- (0.3) --
Total cash
cost for
per ounce
calculations 33.9 25.3 5.1 106.4 4.2 6.7
Accretion
expense
and other 0.1 (0.3) 0.1 (0.3) 0.1 0.5
Depreciation,
depletion and
amortization 8.5 2.9 3.3 28.8 1.8 2.1
Minority
interest
and other -- -- -- -- (0.2) --
Total production
cost for per
ounce
calculations $ 42.5 $ 27.9 $ 8.5 $ 134.9 $ 5.9 $ 9.3
Equity ounces
sold (000) 139.3 95.5 35.4 474.4 11.0 46.2
Equity cash
cost per
ounce sold $ 244 $ 265 $ 143 $ 224 $ 383 $ 144
Equity total
production cost
per ounce sold $ 305 $ 291 $ 238 $ 284 $ 551 $ 201
Three Months Ended
December 31, 2003 Ovacik Central Asia Total Gold
---------- ------------ ----------
Costs applicable to sales
under GAAP $ 4.7 $ 11.9 $ 378.0
Minority interest -- -- (45.1)
Accretion expense (0.2) (0.7) 2.6
Write-down of inventories (0.1) (0.1) (0.4)
Purchased ore and other -- -- (21.4)
Total cash cost for per ounce
calculations 4.4 11.1 313.7
Accretion expense and other 0.1 0.6 (3.1)
Depreciation, depletion and
amortization 2.5 4.6 116.4
Minority interest and other -- -- (16.1)
Total production cost for
per ounce calculations $ 7.0 $ 16.3 $ 410.9
Equity ounces sold (000) (1) 30.5 76.7 1,645.9
Equity cash cost per
ounce sold $ 144 $ 144 $ 197
Equity total production
cost per ounce sold $ 231 $ 213 $ 259
(1) Excludes 66.2 ounces from equity investments and 3.0 ounces from Golden
Grove.
Year Ended
December 31,
2004 Golden La North
Nevada Giant Holloway Canada Herradura America
---------- ---------- ---------- ---------- ---------- ----------
Costs applicable
to sales
under GAAP $ 716.3 $ 47.6 $ 24.7 $ 72.3 $ 10.1 $ 798.7
Minority
interest -- -- -- -- -- --
Accretion
expense (5.6) (0.3) (0.1) (0.4) (0.1) (6.1)
Write-down
of inventories -- -- -- -- -- --
Purchased ore
and other (38.4) 0.2 0.1 0.3 -- (38.1)
Total cash cost
for per ounce
calculations 672.3 47.5 24.7 72.2 10.0 754.5
Accretion
expense and
other 5.6 0.3 0.1 0.4 0.1 6.1
Depreciation,
depletion
and
amortization 126.8 11.4 7.0 18.4 5.0 150.2
Minority
interest
and other -- -- -- -- -- --
Total production
cost for per
ounce
calculations $ 804.7 $ 59.2 $ 31.8 $ 91.0 $ 15.1 $ 910.8
Equity ounces
sold (000) 2,416.0 160.0 67.4 227.4 68.8 2,712.2
Equity cash
cost per
ounce sold $ 278 $ 297 $ 367 $ 318 $ 146 $ 278
Equity total
production cost
per ounce sold $ 333 $ 370 $ 473 $ 400 $ 220 $ 336
Year Ended
December 31, Kori South
2004 Yanacocha Kollo America Pajingo Yandal Tanami
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under GAAP $ 432.6 $ 9.8 $ 442.4 $ 59.4 $ 105.9 $ 194.2
Minority
interest (218.8) (1.2) (220.0) -- -- --
Accretion
expense (3.1) (0.9) (4.0) (0.3) (1.7) (1.2)
Write-down
of
inventories -- (2.1) (2.1) (1.1) (0.2) (8.2)
Purchased ore
and other (0.1) -- (0.1) -- -- --
Total cash cost
for per
ounce
calculations 210.6 5.6 216.2 58.0 104.0 184.8
Accretion
expense and
other 3.1 0.9 4.0 0.1 1.7 1.0
Depreciation,
depletion
and
amortization 198.0 2.3 200.3 31.4 26.8 37.9
Minority
interest
and
other (88.8) (0.3) (89.1) -- -- --
Total
production
cost for
per ounce
calculations $ 322.9 $ 8.5 $ 331.4 $ 89.5 $ 132.5 $ 223.7
Equity ounces
sold (000) 1,561.0 21.7 1,582.7 251.4 379.3 658.0
Equity cash
cost per ounce
sold $ 135 $ 260 $ 137 $ 230 $ 274 $ 281
Equity total
production
cost per
ounce sold $ 207 $ 397 $ 209 $ 356 $ 349 $ 340
Year Ended Australia/
December 31, New Batu
2004 Kalgoorlie Martha Zealand Hijau Minahasa Indonesia
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under GAAP $ 140.9 $ 28.1 $ 528.5 $ 91.2 $ 19.8 $ 111.0
Minority
interest -- -- -- (42.1) -- (42.1)
Accretion
expense (1.7) (0.4) (5.3) (0.5) (0.3) (0.8)
Write-down
of inventories -- -- (9.5) -- (0.2) (0.2)
Purchased
ore and other -- -- -- 2.1 (1.2) 0.9
Total cash cost
for per ounce
calculations 139.2 27.7 513.7 50.7 18.1 68.8
Accretion
expense and
other 1.7 0.4 4.9 0.5 0.3 0.8
Depreciation,
depletion
and
amortization 16.2 13.8 126.1 28.2 2.4 30.6
Minority
interest and
other -- -- -- (12.6) (0.1) (12.7)
Total production
cost for
per ounce
calculations $ 157.1 $ 41.9 $ 644.7 $ 66.8 $ 20.7 $ 87.5
Equity ounces
sold (000) 468.4 130.5 1,887.6 396.3 70.2 466.5
Equity cash
cost per ounce
sold $ 297 $ 212 $ 272 $ 128 $ 259 $ 148
Equity total
production cost
per ounce sold $ 336 $ 320 $ 342 $ 169 $ 295 $ 188
Year Ended Central
December 31, 2004 Zarafshan Ovacik Asia Total Gold
------------ ------------ ------------ ------------
Costs applicable
to sales under GAAP $ 32.4 $ 22.9 $ 55.3 $ 1,935.9
Minority interest -- -- -- (262.1)
Accretion expense (0.3) (0.4) (0.7) (16.9)
Write-down of
inventories -- (1.3) (1.3) (13.1)
Purchased ore
and other (0.1) -- (0.1) (37.4)
Total cash cost
for per ounce
calculations 32.0 21.2 53.2 1,606.4
Accretion expense
and other 0.3 0.2 0.5 16.3
Depreciation,
depletion and
amortization 10.3 18.6 28.9 536.1
Minority interest
and other -- (2.9) (2.9) (104.7)
Total production
cost for per ounce
calculations $ 42.6 $ 37.1 $ 79.7 $ 2,054.1
Equity ounces
sold (000) (1) 210.1 110.0 320.1 6,969.1
Equity cash cost
per ounce sold $ 152 $ 193 $ 166 $ 231
Equity total
production cost per
ounce sold $ 203 $ 338 $ 249 $ 295
(1) Excludes 19.3 ounces from Golden Grove.
Year Ended
December 31, Golden La
2003 Nevada Giant Holloway Canada Mesquite Herradura
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under GAAP $ 597.8 $ 53.4 $ 20.8 $ 74.2 $ 9.3 $ 11.1
Minority
interest -- -- -- -- -- --
Accretion
expense 0.1 (1.3) (0.5) (1.8) (0.2) (0.1)
Write-down
of
inventories (2.9) -- -- -- -- --
Purchased ore
and other (32.1) -- -- -- -- --
Total cash cost
for per ounce
calculations 562.9 52.1 20.3 72.4 9.1 11.0
Accretion
expense
and other (0.1) 1.3 0.5 1.8 0.2 0.1
Depreciation,
depletion and
amortization 137.7 22.0 5.3 27.3 3.9 3.4
Minority
interest
and other -- -- -- -- -- --
Total production
cost for per
ounce
calculations $ 700.5 $ 75.4 $ 26.1 $ 101.5 $ 13.2 $ 14.5
Equity ounces
sold (000) 2,490.8 229.7 65.1 294.8 49.2 67.8
Equity cash
cost per ounce
sold $ 235 $ 227 $ 312 $ 246 $ 184 $ 162
Equity total
production cost
per ounce sold $ 292 $ 329 $ 402 $ 345 $ 267 $ 214
Year Ended
December 31, North Kori South
2003 America Yanacocha Kollo America Pajingo Yandal
---------- ---------- ---------- ---------- ---------- ----------
Costs applicable
to sales
under GAAP $ 692.4 $ 362.5 $ 35.6 $ 398.1 $ 42.9 $ 158.7
Minority
interest -- (183.5) (4.2) (187.7) -- --
Accretion
expense (2.0) (3.4) (2.1) (5.5) (0.1) (1.5)
Write-down
of
inventories (2.9) -- -- -- -- (3.0)
Purchased ore
and other (32.1) -- -- -- -- --
Total cash cost
for per ounce
calculations 655.4 175.6 29.3 204.9 42.8 154.2
Accretion
expense and
other 2.0 3.4 2.1 5.5 (0.3) 1.4
Depreciation,
depletion
and
amortization 172.3 160.4 6.8 167.2 29.2 35.8
Minority
interest and
other -- (70.1) (0.8) (70.9) -- --
Total production
cost for per
ounce
calculations $ 829.7 $ 269.3 $ 37.4 $ 306.7 $ 71.7 $ 191.4
Equity ounces
sold (000) 2,902.6 1,467.9 158.5 1,626.4 330.3 565.6
Equity cash
cost per
ounce sold $ 233 $ 120 $ 184 $ 126 $ 129 $ 273
Equity total
production
cost per
ounce sold $ 295 $ 184 $ 235 $ 189 $ 217 $ 339
Year Ended Australia/
December 31, New
2003 Tanami Kalgoorlie Martha Zealand Minahasa Zarafshan
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under GAAP $ 148.9 $ 108.4 $ 24.9 $ 483.8 $ 26.3 $ 32.9
Minority
interest (4.2) -- (0.3) (4.5) -- --
Accretion
expense (1.2) (0.8) (0.4) (4.0) (0.5) (0.7)
Write-down of
inventories (2.0) (1.0) (2.6) (8.6) (1.3) --
Purchased ore
and other -- -- -- -- (1.6) --
Total cash
cost for per
ounce
calculations 141.5 106.6 21.6 466.7 22.9 32.2
Accretion
expense and
other 0.2 0.8 0.2 2.3 0.5 0.7
Depreciation,
depletion
and
amortization 36.0 9.8 11.5 122.3 7.6 10.1
Minority
interest and
other (1.0) -- (0.1) (1.1) (0.5) --
Total production
cost for per
ounce
calculations $ 176.7 $ 117.2 $ 33.2 $ 590.2 $ 30.5 $ 43.0
Equity ounces
sold (000) 588.6 404.7 108.9 1,998.1 92.2 218.1
Equity cash
cost per ounce
sold $ 240 $ 263 $ 199 $ 234 $ 249 $ 147
Equity total
production cost
per ounce sold $ 300 $ 289 $ 306 $ 295 $ 332 $ 197
Year Ended Central
December 31, 2003 Ovacik Asia Total Gold
---------- ---------- ----------
Costs applicable to
sales under GAAP $ 22.3 $ 55.2 $ 1,655.8
Minority interest -- -- (192.2)
Accretion expense (0.4) (1.1) (13.1)
Write-down of inventories (0.1) (0.1) (12.9)
Purchased ore and other -- -- (33.7)
Total cash cost for
per ounce calculations 21.8 54.0 1,403.9
Accretion expense and other 0.2 0.9 11.2
Depreciation, depletion and
amortization 13.9 24.0 493.4
Minority interest and other -- -- (72.5)
Total production cost
for per ounce calculations $ 35.9 $ 78.9 $ 1,836.0
Equity ounces sold (000) (1) 168.2 386.3 7,005.6
Equity cash cost per ounce sold $ 129 $ 139 $ 203
Equity total production cost
per ounce sold $ 213 $ 204 $ 266
(1) Excludes 364.6 ounces from equity investments in Batu Hijau, TVX Newmont
Americas and Echo Bay Mines Limited and 13.4 ounces from Golden Grove.
6. Reconciliation of Costs Applicable to Sales to Total Cash Cost Per Ounce,
and Total Production Cost Per Ounce
(dollars in millions except per ounce amounts)
Three Months Ended Year Ended
December 31, 2003 December 31, 2003
-------------------------------------- --------------------------------------
Batu Batu
Hijau(1) Minahasa Indonesia Hijau(1) Minahasa Indonesia
---------- ---------- ---------- ---------- ---------- ----------
Costs
applicable
to sales
under
GAAP $ 14.5 $ 4.6 $ 19.1 $ 68.9 $ 26.3 $ 95.2
Minority
interest (6.0) -- (6.0) (29.7) -- (29.7)
Accretion
expense (0.2) (0.1) (0.3) (1.2) (0.5) (1.7)
Write-down
of
inventories -- -- -- -- (1.3) (1.3)
Purchased
ore and
other 0.4 (0.3) 0.1 1.8 (1.6) 0.2
Total cash
cost for
per ounce
calculations 8.7 4.2 12.9 39.8 22.9 62.7
Accretion
expense and
other 0.2 0.1 0.3 1.2 0.5 1.7
Depreciation,
depletion
and
amortization 6.7 1.8 8.5 32.0 7.6 39.6
Minority
interest
and other (2.9) (0.2) (3.1) (14.0) (0.5) (14.5)
Total
production
cost for per
ounce
calculations $ 12.7 $ 5.9 $ 18.6 $ 59.0 $ 30.5 $ 89.5
Equity ounces
sold (000) 66.2 11.0 77.2 328.9 92.2 421.1
Equity cash
cost per
ounce sold $ 131 $ 383 $ 167 $ 121 $ 249 $ 149
Equity total
production
cost per
ounce sold $ 192 $ 551 $ 243 $ 179 $ 332 $ 212
(1) Cash and total production cost per ounce presented on a pro forma co-product
basis.
7. Reconciliation of Batu Hijau Costs Applicable to Sales to Total Cash Cost
Per Equity Pound, and Total Production Cost Per Equity Pound (dollars in
millions except per pound amounts)
Three Months Ended Year Ended
December 31, December 31,
--------------------------- ---------------------------
2004 2003(1) 2004 2003(1)
------------ ------------ ------------ ------------
Costs applicable to
sales per financial
statements $ 80.1 $ 56.1 $ 304.7 $ 196.2
Minority interest (38.9) (25.8) (140.7) (90.5)
Accretion expense (0.4) (0.7) (1.7) (3.0)
Smelting and refining 15.3 15.5 66.0 55.1
Total cash cost for per
pound calculation 56.1 45.1 228.3 157.8
Accretion expense 0.4 0.7 1.7 3.0
Depreciation, depletion
and amortization 24.4 22.6 89.3 79.9
Minority interest (11.5) (9.9) (39.9) (35.0)
Total production cost
for per pound calculation $ 69.4 $ 58.5 $ 279.4 $ 205.7
Equity copper sold
(000 lbs) 86,850 79,089 378,801 343,378
Total cash cost per
equity pound $ 0.65 $ 0.57 $ 0.60 $ 0.46
Total production cost
per equity pound $ 0.80 $ 0.74 $ 0.74 $ 0.60
(1) 2003 cash and total production cost per pound presented on a pro forma
co-product basis.
8. Reconciliation of Golden Grove Costs Applicable to Sales to Total Cash Cost
Per Pound, and Total Production Cost Per Equity Pound
(dollars in millions except per pound amounts)
Three Months Ended December 31,
--------------------------------------------------------------------------------
2004 2003
-------------------------------------- --------------------------------------
Total Copper Zinc Total Copper Zinc
---------- ---------- ---------- ---------- ---------- ----------
Costs applicable
to sales per
financial
statements $ 16.0 $ 13.3 $ 2.7 $ 13.8 $ 15.3 $ (1.5)
Accretion expense (0.1) (0.1) -- (0.1) -- (0.1)
Write-down
inventories (0.2) (0.6) 0.4 (0.1) -- (0.1)
Smelting and
refining and
purchased
concentrates 6.2 1.4 4.8 10.9 3.4 7.5
Total cash cost
for per pound
calculation $ 21.9 $ 14.0 $ 7.9 $ 24.5 $ 18.7 $ 5.8
Total sold
(000 lbs) n/a 13,862 22,392 n/a 28,136 41,579
Total cash cost
per pound sold n/a $ 1.01 $ 0.35 n/a $ 0.67 $ 0.14
Year Ended December 31,
--------------------------------------------------------------------------------
2004 2003
-------------------------------------- --------------------------------------
Total Copper Zinc Total Copper Zinc
---------- ---------- ---------- ---------- ---------- ----------
Costs applicable
to sales per
financial
statements $ 61.8 $ 38.7 $ 23.1 $ 43.5 $ 37.4 $ 6.1
Accretion expense (0.6) (0.3) (0.3) (0.4) (0.2) (0.2)
Write-down
inventories (8.2) (2.9) (5.3) (7.2) (3.9) (3.3)
Smelting and
refining and
purchased
concentrates 29.3 3.8 25.5 27.4 10.6 16.8
Total cash cost
for per pound
calculation $ 82.3 $ 39.3 $ 43.0 $ 63.3 $ 43.9 $ 19.4
Total sold
(000 lbs) n/a 43,467 114,835 n/a 74,303 104,711
Total cash cost
per pound sold n/a $ 0.90 $ 0.38 n/a $ 0.59 $ 0.19
9. Reconciliation of Total Newmont Costs Applicable to Sales to Total Copper
Cash Cost Per Equity Pound, (dollars in millions except per pound amounts)
Three Months Ended Year Ended
December 31, December 31,
--------------------------- ---------------------------
2004 2003(1) 2004 2003(1)
------------ ------------ ------------ ------------
Costs applicable to
sales per financial
statements $ 93.4 $ 71.4 $ 343.4 $ 233.6
Minority interest (38.9) (25.8) (140.7) (90.5)
Accretion expense (0.5) (0.7) (2.0) (3.2)
Write-down inventories (0.6) -- (2.9) --
Smelting and refining 16.7 18.9 69.8 65.7
Total cash cost for
per pound calculation $ 70.1 $ 63.8 $ 267.6 $ 205.6
Equity copper sold
(000 lbs) 100,712 107,225 422,268 417,681
Total cash cost per
equity pound $ 0.70 $ 0.59 $ 0.63 $ 0.48
(1) 2003 total cash cost per equity pound presented on a pro forma co-product
basis.
10. Gold Hedge Position -- Current Maturity Summary (1)(3) (000 ounces)
Gold Put Option Contracts Price Capped Contracts
--------------------------- ---------------------------
Years Ozs Price(2) Ozs Price(2)
- ------------- ------------ ------------ ------------ ------------
2005 205 $ 292 500 $ 350
2006 100 $ 338 -- --
2007 20 $ 397 -- --
2008 -- -- 1,000 $ 384
2009 -- -- 600 $ 381
2010 -- -- -- --
2011 -- -- 250 $ 392
Total/Average 325 $ 313 2,350 $ 377
The mark-to-market value of the gold put option contracts was negative $8.9
million at December 31, 2004.
Notes:
(1) For more detailed descriptions, definitions and explanations, refer to
the Company's Annual Report on Form 10-K for the year ended December 31,
2004 to be filed in March 2005.
(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.
(3) In addition to the gold hedge positions shown in the table above, the
Company entered into a prepaid forward gold sales contract in July 1999,
which is reflected as debt on the Company's consolidated balance sheet.
Under the prepaid forward gold sales contract, the Company agreed to
sell 483,333 ounces of gold, to be delivered in June of each of 2005,
2006 and 2007 in annual installments of 161,111 ounces of gold. For more
detailed descriptions, definitions and explanations, refer to the
Company's Annual Report on Form 10-K for the year ended December 31,
2004 to be filed in March 2005.
The Company's fourth quarter earnings conference call and web cast
presentation will be held on February 24, 2005 beginning at 4:00 p.m. Eastern
Time (2:00 p.m. Mountain Time). To participate:
Dial-In Number: (773) 756-0828
Leader: Randy Engel
Password: Newmont
The conference call will also be simultaneously carried on our web site at
www.newmont.com under Investor Information/Presentations and will be archived
there for a limited time.
Investor Contacts
Randy Engel
Telephone: (303) 837-6033
Email: randy.engel@newmont.com
Wendy Yang
Telephone: (303) 837-6141
Email: wendy.yang@newmont.com
Jennifer Van Dinter
Telephone: (303) 837-5165
Email: jennifer.vandinter@newmont.com
Media Contacts
Doug Hock
Telephone: (303) 837-5812
Email: doug.hock@newmont.com
Cautionary Statement
This news release contains "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 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 gold and other metals
production and sales; (ii) estimates of future cash costs and total production
costs; (iii) estimates of future capital expenditures, expenses and tax rates;
(iv) estimates regarding timing of future production or closure activities; (v)
statements regarding future exploration results and the replacement of reserves;
(vi) statements regarding future asset sales or rationalization efforts; and
(vii) estimates of 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,
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 2003 Annual Report on Form 10-K,
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 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- 02/24/2005 AA LATH060
/PRNewswire -- Feb. 24/
/END FIRST AND FINAL ADD/
/Web site: http://www.newmont.com /