Exhibit 99.1
NEWMONT REPORTS THIRD QUARTER NET INCOME INCREASED 57% TO $198 MILLION
($0.44 PER SHARE)
DENVER, Nov. 1 /PRNewswire-FirstCall/ -- Newmont Mining Corporation
(NYSE: NEM) today announced:
* Consolidated gold sales for the third quarter of 1.7 million ounces (1.4
million equity ounces) at costs applicable to sales of $318 per ounce and
an average realized price of $615 per ounce;
* Net income for the third quarter of $198 million ($0.44 per share)
compared with $126 million ($0.28 per share) for the third quarter of
2005; and
* Net income for the nine months ended September 30, 2006 of $568 million
($1.26 per share) compared with $260 million ($0.58 per share) for the
first nine months of 2005.
Wayne W. Murdy, Chairman and Chief Executive Officer, said, "Our results
reflect continuing earnings growth and our leverage to the gold price.
Year-to-date earnings grew over 100% from the prior year, while gold prices rose
approximately 40% for the same period. We are maintaining our production and
cost outlook for the year, as our Leeville and Phoenix projects in Nevada near
commercial production and our Ahafo mine in Ghana continues to ramp up. These
new mines, as well as our expectation for a fifth straight year of reserve
growth net of depletion, will form a solid base from which to grow our
business."
Financial ($ millions,
except per share) Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Revenues $ 1,102 $ 1,145 $ 3,527 $ 3,060
Income from continuing
operations $ 264 $ 125 $ 625 $ 291
Income from continuing
operations per common share $ 0.59 $ 0.28 $ 1.39 $ 0.65
Net income $ 198 $ 126 $ 568 $ 260
Net income per common share $ 0.44 $ 0.28 $ 1.26 $ 0.58
Operating Consolidated gold
sales (000 ounces) 1,698 2,122 5,350 6,022
Equity gold sales
(000 ounces) (1, 2) 1,379 1,607 4,155 4,695
Average realized gold price
($/ounce) $ 615 $ 435 $ 591 $ 427
Costs applicable to sales
($/ounce) $ 318 $ 236 $ 297 $ 239
(1) Includes 45,700 and 82,900 ounces for the three and nine month periods
ended September 30, 2006, respectively, from Leeville and Phoenix
start-up activities, which are not included in Revenue, Costs
applicable to sales and Depreciation, depletion and amortization per
ounce calculations. Revenues and costs during start-up are included in
Other income, net.
(2) Includes sales from the Holloway and Zarafshan discontinued operations.
Net income for the third quarter was impacted by various items which had the
effect of increasing net income by $28 million ($0.06 per share). Net income for
the nine months ended September 30, 2006 was impacted by various items which had
the net effect of increasing net income by $51 million ($0.11 per share). For a
detailed analysis of items impacting net income, please see the table further in
this release.
Operating Highlights
Nevada Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Consolidated gold sales
(000 ounces)1 569 597 1,647 1,792
Equity gold sales
(000 ounces) (1) 555 554 1,540 1,681
Costs applicable to sales
($/ounce) $ 428 $ 356 $ 425 $ 327
(1) Includes 45,700 and 82,900 ounces for the three and nine month periods
ended September 30, 2006, respectively, from incidental sales during
start-up at Leeville and Phoenix.
In Nevada, equity gold sales were essentially equivalent to the year-ago
quarter. Costs applicable to sales increased 20% from the year-ago quarter,
primarily due to lower consolidated gold sales and increased labor, diesel,
cyanide and underground contract service costs, but were 5% lower than the
second quarter of 2006. Compared to the third quarter of 2005, costs applicable
to sales were also impacted by the change in accounting for open pit waste
removal. In the third quarter of 2005, $15 million of mining costs were deferred
which reduced costs applicable to sales by $25 per ounce.
The Leeville and Phoenix mines are expected to achieve commercial operation
in the fourth quarter. Leeville has achieved its targeted mining rate of 2,100
tons per day and is expected to achieve a steady state mining rate of 3,200 tons
per day by the end of 2007. Phoenix also achieved its design production rate and
was operating at a rate of 31,000 tons per day at the end of October. Gold
production at the Lone Tree property continues to decline as mining is expected
to be completed by year-end.
Yanacocha Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Consolidated gold
sales (000 ounces) 578 770 2,133 2,265
Equity gold sales (000 ounces) 297 395 1,096 1,163
Costs applicable to sales
($/ounce) $ 210 $ 144 $ 183 $ 147
At Yanacocha in Peru, gold sales continue to meet targeted projections.
Sales decreased 25% from the year ago quarter due to previously anticipated
higher strip ratios and lower grades. The lower production, as well as higher
labor and fuel costs, resulted in a 46% increase in costs applicable to sales
from the year-ago quarter. Yanacocha also began construction of a gold mill with
start-up anticipated in 2008.
During the third quarter of 2006, Yanacocha recorded a $19 million charge
related to an agreement with the Peruvian government to pay a negotiated royalty
for community improvements during the current period of high metal prices. The
royalty is based on 3.75% of net income beginning January 1, 2006 for a period
of up to five years.
Australia/New Zealand Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Consolidated gold sales
(000 ounces) 355 377 1,004 1,204
Equity gold sales
(000 ounces) 355 377 1,004 1,204
Costs applicable to sales
($/ounce) $ 376 $ 321 $ 383 $ 318
In Australia/New Zealand, the Company sold 6% fewer ounces of gold in the
third quarter of 2006 compared to 2005, primarily due to:
* a 24% decline in mill throughput at Tanami from the depletion of
Groundrush stockpiles in 2005;
* an 11% decrease in tons milled at Kalgoorlie due to more abrasive and
harder ore, lower roaster operation due to operating restrictions and a
planned maintenance shutdown;
* a 9% decrease in tons milled at Pajingo due to ground control issues at
Vera South Deeps and slower than planned access at Jandam; and
* a 26% decrease in mill throughput at Martha as mining activities
transition from open pit to the Favona underground operation; partially
offset by
* higher grades at Tanami, Jundee and Martha.
Costs applicable to sales for the third quarter increased by 17% from the
third quarter of 2005, primarily due to the decrease in production and increased
royalties resulting from higher gold prices. Costs applicable to sales were also
impacted by the change in accounting for open pit waste removal costs. In the
third quarter of 2005, $3 million of mining costs were deferred which reduced
costs applicable to sales by $7 per ounce.
Construction of the Boddington project is on schedule and approximately 11%
complete, with start-up expected in late 2008 or early 2009.
Batu Hijau Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Consolidated copper sales
(million pounds) 90 190 288 444
Equity copper sales
(million pounds) 48 100 152 235
Costs applicable to sales
($/pound copper) $ 0.73 $ 0.45 $ 0.75 $ 0.51
Average realized copper
price, net $ 1.04 $ 1.22 $ 1.50 $ 1.14
Consolidated gold sales
(000 ounces) 59 289 266 540
Equity gold sales
(000 ounces) 31 153 141 285
Costs applicable to sales
($/ounce gold) $ 286 $ 133 $ 219 $ 149
At Batu Hijau in Indonesia, production continues to be impacted by lower
grades and lower mill throughput due to harder ore. Batu Hijau expanded its
mining fleet with 26 new haul trucks and an additional shovel, resulting in a
54% increase in tons mined. However, copper and gold sales decreased 52% and 80%
in the third quarter of 2006 respectively, primarily as a result of lower copper
(37%) and gold (75%) ore grades, and lower mill throughput (18%). Costs
applicable to sales increased 62% per pound of copper and 115% per ounce of gold
due to lower production, the expansion of the mining fleet and increased diesel,
tire, labor and process maintenance costs. Costs applicable to sales were also
impacted by the change in accounting for open pit waste removal costs. In the
third quarter of 2005, $15 million of mining costs was amortized which increased
costs applicable to sales by $0.06 per pound of copper and $13 per ounce of
gold.
Batu Hijau is expected to sell between 215 and 230 million equity pounds of
copper and 185,000 and 200,000 equity ounces of gold in 2006. Sales are expected
to remain at these levels through 2009, primarily as a result of mine
re-sequencing and lower throughput. The Company is currently evaluating
additional grinding capacity to increase mill throughput.
Ahafo Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Consolidated gold sales
(000 ounces) 77 -- 77 --
Equity gold sales
(000 ounces) 77 -- 77 --
Costs applicable to sales
($/ounce) $ 251 -- $ 251 --
Ahafo commenced commercial production in August 2006 after a successful
start-up in July. Ahafo generated gold sales of 77,300 ounces in the third
quarter. Gold production is currently being impacted by nationwide power
rationing due to low water levels serving Ghana's hydroelectric facilities. The
Company is installing additional diesel generating capacity at Ahafo and, along
with other mining industry members, is exploring longer-term, lower-cost
solutions to the current power shortages.
Costs applicable to sales were $251 per ounce for the third quarter and are
forecast at between $260 and $290 per ounce for the year. Costs applicable to
sales in the third quarter of 2006 benefited from the capitalization of
pre-production costs and are expected to be higher in 2007 as a result. In
addition, 2007 costs are expected to be negatively impacted by increased power
costs.
Other Operations Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Consolidated gold sales
(000 ounces) 59 89 222 222
Equity gold sales
(000 ounces) 56 86 210 217
Costs applicable to sales
($/ounce) $ 173 $ 212 $ 212 $ 245
At La Herradura in Mexico, gold sales increased 2% in the third quarter of
2006 from 2005, primarily as a result of favorable production timing from the
leach pad. Costs applicable to sales increased by 39%, primarily due to the
change in accounting for open pit waste removal costs, increased labor, diesel
and other commodity costs. In the third quarter of 2005, $1 million of mining
costs were deferred which reduced costs applicable to sales by $51 per ounce.
At Kori Kollo in Bolivia, gold sales decreased 5% in the third quarter of
2006 from 2005 and increased 129% in the first nine months of 2006 resulting
from the placement of additional material from the Kori Kollo pit on the
existing leach pad and ore from the Kori Chaca pit on a new leach pad.
At Golden Giant in Canada, mining ceased in December 2005. Remnant mining
and milling production in the third quarter and first nine months of 2006 was
higher than expected due to additional in-circuit inventory. Remnant production
was completed in the third quarter of 2006.
In Uzbekistan, the Uzbek Government expropriated the Company's interest in
the Zarafshan-Newmont Joint Venture during the third quarter. As a result, the
Company recognized a $101 million pre-tax write-off in the third quarter, which
is accounted for as a discontinued operation. The Company is seeking to recover
the value of its investment and lost profits through international arbitration.
Merchant Banking
Third quarter and year-to-date royalty and dividend income was $30 million
and $88 million, respectively, 67% higher than the year ago quarter and 54%
higher than the first three quarters of 2005, primarily due to higher commodity
prices. The value of the marketable equity securities portfolio grew to
approximately $1.3 billion at the end of the quarter, compared to $940 million
at the start of the year, driven primarily by capital appreciation. Unrealized
pre-tax gains in the portfolio were approximately $715 million at quarter-end.
During the third quarter, the Company completed the sale of its Alberta oil
sands project for approximately $280 million, recognizing a pre-tax gain of $266
million, and the sale of its Martabe project, generating net proceeds of
approximately $79 million and a pre-tax gain of $30 million.
During the third quarter, the Company also purchased a 40% interest in the
Fort a la Corne JV (FALC) diamond project from Shore Gold Inc. for approximately
$152 million. The FALC property, located in Saskatchewan, Canada, is one of the
largest kimberlite fields in the world. The Company, which already owned 9.7% of
Shore Gold Inc., believes that this investment represents an opportunity to
participate directly in a significant, district-scale diamond development
project.
2006 Guidance
The Company continues to expect equity gold sales of between 5.6 and 5.8
million ounces at costs applicable to sales of between $290 and $310 per ounce.
The Company also continues to expect equity copper sales of between 215 and 230
million pounds at costs applicable to sales of between $0.65 and $0.75 per
pound.
Equity Sales Costs Applicable
(000 ounces) to Sales ($/oz)
------------- ----------------
Gold
Nevada, USA 2,310 - 2,355 $380 - $395
Yanacocha, Peru 1,330 - 1,365 $200 - $210
Australia/New Zealand 1,365 - 1,400 $380 - $395
Batu Hijau, Indonesia 185 - 200 $200 - $225
Ahafo, Ghana 160 - 195 $260 - $290
Other 250 - 285 $215 - $255
Total (1) 5,600 - 5,800 $290 - $310
(1) Total Costs Applicable to Sales are calculated on a consolidated basis.
Equity Sales Costs Applicable
(million pounds) to Sales ($/lb)
---------------- ----------------
Copper
Batu Hijau, Indonesia 215 - 230 $0.70 - $0.75
Consolidated Financial Guidance ($ millions, except tax rate)
- -------------------------------------------------------------
Royalty and dividend income $105 - $115
Depreciation, depletion & amortization $610 - $640
Exploration $160 - $165
Advanced projects, research and development $85 - $100
General and administrative $150 - $160
Interest expense, net $95 - $105
Tax rate (assuming $625/oz gold) 28% - 32%
Capital expenditures $1,500 - $1,700
Statements of Consolidated Income
Three Months Ended Nine Months Ended
September 30, September 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
(unaudited, in millions except per share)
Revenues
Sales - gold, net $ 1,009 $ 914 $ 3,095 $ 2,556
Sales - copper, net 93 231 432 504
1,102 1,145 3,527 3,060
Costs and expenses
Costs applicable to sales
(exclusive of depreciation,
depletion and amortization
shown separately below)
Gold 525 502 1,564 1,437
Copper 66 86 215 226
Depreciation, depletion and
amortization 153 155 444 466
Exploration 41 39 120 103
Advanced projects, research
and development 19 18 68 47
General and administrative 29 32 103 95
Other expense, net 37 20 64 61
870 852 2,578 2,435
Other income (expense)
Other income, net 317 66 386 177
Interest expense, net (28) (23) (70) (75)
289 43 316 102
Income from continuing
operations before income tax
expense, minority interest
and equity income of
affiliates 521 336 1,265 727
Income tax expense (206) (96) (362) (191)
Minority interest in income
of consolidated subsidiaries (52) (115) (279) (248)
Equity income of affiliates 1 -- 1 3
Income from continuing
operations 264 125 625 291
Gain (loss) from discontinued
operations (66) 1 (57) (31)
Net income $ 198 $ 126 $ 568 $ 260
Income per common share Basic
and diluted:
Income from continuing
operations $ 0.59 $ 0.28 $ 1.39 $ 0.65
Loss from discontinued
operations (0.15) -- (0.13) (0.07)
Net income $ 0.44 $ 0.28 $ 1.26 $ 0.58
Basic weighted-average
common shares outstanding 450 446 449 446
Diluted weighted-average
common shares outstanding 452 449 451 449
Cash dividends declared per
common share $ 0.10 $ 0.10 $ 0.30 $ 0.30
Consolidated Balance Sheets
At At
September 30, December 31,
2006 2005
------------- -------------
(unaudited, in millions)
ASSETS
Cash and cash equivalents $ 1,059 $ 1,082
Marketable securities and other
short-term investments 273 817
Trade receivables 150 94
Accounts receivable 148 135
Inventories 372 304
Stockpiles and ore on leach pads 336 241
Deferred stripping costs -- 78
Deferred income tax assets 140 159
Other current assets 115 90
Current assets 2,593 3,000
Property, plant and mine development, net 6,547 5,581
Investments 1,239 955
Long-term stockpiles and ore on leach pads 795 599
Deferred stripping costs -- 100
Deferred income tax assets 814 515
Other long-term assets 202 181
Goodwill 2,895 2,879
Assets of operations held for sale 36 182
Total assets $ 15,121 $ 13,992
LIABILITIES
Current portion of long-term debt $ 158 $ 195
Accounts payable 251 227
Employee-related benefits 167 176
Derivative instruments 453 270
Other current liabilities 609 471
Current liabilities 1,638 1,339
Long-term debt 1,799 1,723
Reclamation and remediation liabilities 483 442
Deferred income tax liabilities 571 446
Employee-related benefits 284 273
Other long-term liabilities 311 415
Liabilities of operations held for sale 3 47
Total liabilities 5,089 4,685
Minority interest in subsidiaries 996 931
STOCKHOLDERS' EQUITY
Common stock 675 666
Additional paid-in capital 6,683 6,578
Accumulated other comprehensive income 572 378
Retained earnings 1,106 754
Total stockholders' equity 9,036 8,376
Total liabilities and stockholders'
equity $ 15,121 $ 13,992
Statements of Consolidated Cash Flow
Three Months Ended Nine Months Ended
September 30, September 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
(unaudited, in millions)
Operating activities
Net income $ 198 $ 126 $ 568 $ 260
Adjustments to reconcile net
income to net cash from
continuing operations:
Depreciation, depletion and
amortization 153 155 444 466
Revenue from prepaid
forward sales obligation -- -- (48) (48)
Loss from discontinued
operations 66 (1) 57 31
Accretion of accumulated
reclamation obligations 8 6 22 20
Deferred income taxes (40) (7) (117) (34)
Minority interest expense 52 115 279 248
(Gain) loss on asset
sales, net (302) 5 (312) (36)
Gain on sale of
investments, net -- (27) (4) (27)
Hedge loss, net 8 (4) 82 4
Other operating adjustments
and write-downs 12 -- 90 (35)
Decrease (increase) in
operating assets:
Trade and accounts
receivable 49 69 (51) 25
Inventories, stockpiles and
ore on leach pads (101) (88) (323) (155)
Other assets (35) (3) (49) --
Increase (decrease) in
operating liabilities:
Accounts payable and other
accrued liabilities 185 102 208 59
Reclamation liabilities (19) (10) (44) (24)
Net cash provided from
continuing operations 234 438 802 754
Net cash (used in) provided
from discontinued operations (9) (1) (6) 7
Net cash from operations 225 437 796 761
Investing activities
Additions to property, plant
and mine development (407) (353) (1,109) (884)
Investments in marketable
debt and equity securities (309) (488) (1,389) (2,530)
Proceeds from sale of
marketable debt and equity
securities 398 738 1,934 2,562
Acquisitions (161) -- (348) --
Proceeds from sale of assets,
net 323 1 331 61
Other (1) 1 (3) 1
Net cash (used in) provided
from investing activities of
continuing operations (157) (101) (584) (790)
Net cash (used in) provided
from investing activities of
discontinued operations -- 140 (6) 115
Net cash (used in) provided
from investing activities (157) 39 (590) (675)
Financing activities
Proceeds from debt, net 99 -- 198 584
Repayment of debt -- (71) (63) (141)
Early extinguishment of
prepaid forward sales
obligation (48) -- (48) --
Dividends paid to common
stockholders (45) (45) (135) (134)
Dividends paid to minority
interests (146) (14) (235) (85)
Proceeds from stock issuance 9 11 66 17
Change in restricted cash and
other (9) (2) (11) (9)
Net cash (used in) provided
from financing activities of
continuing operations (140) (121) (228) 232
Net cash used in financing
activities of discontinued
operations (7) (1) (7) (1)
Net cash (used in) provided
from financing activities (147) (122) (235) 231
Effect of exchange rate
changes on cash 3 -- 6 (3)
Net change in cash and cash
equivalents (76) 354 (23) 314
Cash and cash equivalents at
beginning of period 1,135 741 1,082 781
Cash and cash equivalents at
end of period $ 1,059 $ 1,095 $ 1,059 $ 1,095
Items Impacting Net Income
Description ($ millions,
after tax) Q3 2006 Q3 2005 YTD 2006 YTD 2005
- ------------------------------ -------- -------- -------- --------
Gain on Sale of Assets
Alberta oil sands $ 173 -- $ 173 --
Martabe $ 20 -- $ 20 --
Kinross -- $ 25 -- $ 25
Mezcala -- -- -- $ 20
Other
Tax estimate revisions, net $ (57) -- $ (9) $ 26
Prepaid forward deliveries and
early settlement $ (26) -- $ (49) $ (4)
Stock option accounting $ (3) -- $ (7) --
Peruvian mining royalty $ (10) -- $ (10) --
Buyat Bay litigation &
settlement $ (3) $ (5) $ (10) $ (13)
Reclamation estimate revisions -- $ (5) -- $ (5)
Nevada waste dump slide -- -- -- $ (4)
Discontinued operations $ (66) $ 1 $ (57) $ (31)
Operating Statistics - Summary
Three months ended Nine months ended
September 30, September 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
GOLD
Consolidated ounces sold
(000):
Nevada (1) 568.7 597.1 1,647.1 1,792.2
Yanacocha 578.3 769.5 2,133.3 2,264.6
Batu Hijau 59.1 289.3 266.2 539.6
Australia/New Zealand
Tanami 103.0 111.9 301.6 385.5
Kalgoorlie 80.4 90.7 256.1 300.2
Jundee 89.7 82.8 229.3 248.9
Pajingo 49.7 54.3 117.0 141.1
Martha 32.2 37.3 99.6 127.9
355.0 377.0 1,003.6 1,203.6
Ahafo 77.3 -- 77.3 --
Other
Golden Giant 9.2 38.3 57.6 116.0
La Herradura 21.1 20.6 61.3 61.2
Kori Kollo 28.9 30.3 103.5 45.1
59.2 89.2 222.4 222.3
1,697.6 2,122.1 5,349.9 6,022.3
Equity ounces sold (000):
Nevada (1) 555.3 554.2 1,540.0 1,681.1
Yanacocha 296.9 395.1 1,095.5 1,162.9
Batu Hijau 31.3 152.9 140.7 285.3
Australia/New Zealand
Tanami 103.0 111.9 301.6 385.5
Kalgoorlie 80.4 90.7 256.1 300.2
Jundee 89.7 82.8 229.3 248.9
Pajingo 49.7 54.3 117.0 141.1
Martha 32.2 37.3 99.6 127.9
355.0 377.0 1,003.6 1,203.6
Ahafo 77.3 -- 77.3 --
Other
Golden Giant 9.2 38.3 57.6 116.0
La Herradura 21.1 20.6 61.3 61.2
Kori Kollo 25.4 26.7 91.1 39.7
55.7 85.6 210.0 216.9
1,371.5 1,564.8 4,067.1 4,549.8
Discontinued operations:
Zarafshan 5.6 29.0 62.2 93.1
Holloway 1.6 13.1 25.5 51.9
1,378.7 1,606.9 4,154.8 4,694.8
COPPER
Batu Hijau (pounds sold in
millions):
Consolidated 90.3 190.0 288.0 444.1
Equity 47.7 100.4 152.3 234.8
(1) Includes 45,700 and 82,900 ounces sold (consolidated and equity) for
the three and nine month periods ended September 30, 2006,
respectively, from Leeville and Phoenix start-up activities which are
not included in Revenue, Costs applicable to sales and Depreciation,
depletion and amortization per ounce calculations. Revenues and costs
during start-up are included in Other income, net.
Operating Statistics - Nevada (1)
Three months ended Nine months ended
September 30, September 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short
tons):
Open pit
Ore 8,975 9,594 25,485 24,603
Waste 34,792 39,723 111,361 119,427
Total 43,767 49,317 136,846 144,030
Underground 340 396 991 1,252
Tons milled/processed (000
dry short tons):
Oxide 308 1,389 930 4,065
Refractory 3,478 2,665 9,984 7,270
Leach 5,414 6,075 17,370 15,921
Average ore grade (oz/ton):
Oxide 0.182 0.115 0.208 0.109
Refractory 0.134 0.172 0.129 0.183
Leach 0.025 0.024 0.025 0.025
Average mill recovery rate:
Oxide 92.0% 77.4% 92.5% 75.6%
Refractory 77.4% 89.8% 79.7% 90.1%
Ounces produced (000):
Oxide 51.9 102.8 184.0 310.2
Refractory 436.6 379.5 1,223.4 1,149.2
Leach 80.9 85.7 240.2 276.9
Consolidated 569.4 568.0 1,647.6 1,736.3
Equity 557.1 525.1 1,539.9 1,625.2
Ounces sold (000): (1)
Consolidated 568.7 597.1 1,647.1 1,792.2
Equity 555.3 554.2 1,540.0 1,681.1
Production costs (in millions):
Costs applicable to sales $ 224 $ 212 $ 664 $ 585
Depreciation, depletion and
amortization $ 37 $ 32 $ 108 $ 92
Production costs (per ounce
sold):
Direct mining and production
costs $ 428 $ 368 $ 422 $ 344
Capitalized mining -- (25) -- (26)
By-product credits and other (9) 2 (10) (3)
Royalties and production
taxes 6 8 10 9
Reclamation and mine closure
costs 3 3 3 3
Costs applicable to sales $ 428 $ 356 $ 425 $ 327
Depreciation, depletion and
amortization $ 70 $ 53 $ 69 $ 51
(1) Includes 45,700 and 82,900 ounces sold (consolidated and equity) for
the three and nine month periods ended September 30, 2006,
respectively, from Leeville and Phoenix start-up activities which are
not included in Revenue, Costs applicable to sales and Depreciation,
depletion and amortization per ounce calculations. Revenues and costs
during start-up are included in Other income, net.
Operating Statistics - Yanacocha
Three months ended Nine months ended
September 30, September 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short
tons):
Ore 30,978 48,670 91,877 110,430
Waste 28,880 14,216 73,715 55,441
Total 59,858 62,886 165,592 165,871
Tons processed (000 dry short
tons): 30,978 48,670 91,885 110,430
Average ore grade (oz/ton): 0.018 0.030 0.029 0.028
Ounces produced (000):
Consolidated 605.1 763.6 2,156.2 2,268.7
Equity 310.7 392.1 1,107.2 1,165.0
Ounces sold (000):
Consolidated 578.3 769.5 2,133.3 2,264.6
Equity 296.9 395.1 1,095.5 1,162.9
Production costs (in
millions):
Costs applicable to sales $ 121 $ 111 $ 390 $ 334
Depreciation, depletion and
amortization $ 46 $ 50 $ 138 $ 148
Production costs (per ounce
sold):
Direct mining and production
costs $ 218 $ 146 $ 188 $ 150
By-product credits and other (15) (7) (12) (8)
Royalties and production taxes 4 3 4 3
Reclamation and mine closure
costs 3 2 3 2
Costs applicable to sales $ 210 $ 144 $ 183 $ 147
Depreciation, depletion and
amortization $ 80 $ 65 $ 65 $ 65
Operating Statistics - Batu Hijau
Three months ended Nine months ended
September 30, September 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons)
Ore 37,601 26,048 106,153 56,228
Waste 46,747 28,821 111,234 117,625
Total 84,348 54,869 217,387 173,853
Tons milled (000 dry short
tons): 11,362 13,858 34,271 38,447
Average ore grade:
Gold (oz/ton) 0.007 0.028 0.010 0.019
Copper 0.52% 0.83% 0.51% 0.71%
Average mill recovery rate:
Gold 75.2% 82.5% 78.4% 80.7%
Copper 85.4% 90.7% 85.7% 87.2%
Production:
Gold ounces (000)
Consolidated 62.6 316.9 272.0 574.9
Equity 33.1 167.5 143.8 304.0
Copper pounds (millions)
Consolidated 99.8 209.2 303.1 475.2
Equity 52.7 110.6 160.3 251.3
Sales:
Gold ounces (000)
Consolidated 59.1 289.3 266.2 539.6
Equity 31.3 152.9 140.7 285.3
Copper pounds (millions)
Consolidated 90.3 190.0 288.0 444.1
Equity 47.7 100.4 152.3 234.8
Gold production costs (in
millions):
Costs applicable to sales $ 16 $ 38 $ 58 $ 80
Depreciation, depletion and
amortization $ 4 $ 11 $ 14 $ 25
Production costs (per
ounce sold):
Direct mining and production
costs $ 279 $ 115 $ 212 $ 145
Capitalized mining -- 13 -- (1)
By-product credits and other (11) (5) (8) (5)
Royalties and production taxes 15 9 13 9
Reclamation and mine
closure costs 3 1 2 1
Costs applicable to sales $ 286 $ 133 $ 219 $ 149
Depreciation, depletion and
amortization $ 66 $ 36 $ 52 $ 47
Copper production costs (in
millions):
Costs applicable to sales $ 66 $ 86 $ 215 $ 226
Depreciation, depletion and
amortization $ 15 $ 20 $ 49 $ 67
Copper production costs (per
pound sold):
Direct mining and
production costs $ 0.66 $ 0.34 $ 0.70 $ 0.47
Capitalized mining -- 0.06 -- --
By-product credits and other 0.03 0.02 0.02 0.02
Royalties and production taxes 0.03 0.03 0.02 0.02
Reclamation and mine
closure costs 0.01 -- 0.01 --
Costs applicable to sales $ 0.73 $ 0.45 $ 0.75 $ 0.51
Depreciation, depletion and
amortization $ 0.16 $ 0.11 $ 0.17 $ 0.15
Operating Statistics - Pajingo and Jundee
PAJINGO
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons) 154 162 406 482
Tons milled (000 dry short tons) 153 168 408 501
Average ore grade (oz/ton) 0.341 0.328 0.291 0.291
Average mill recovery rate 96.9% 96.3% 96.9% 96.6%
Ounces produced (000):
Consolidated 50.1 54.2 115.9 142.1
Equity 50.1 54.2 115.9 142.1
Ounces sold (000):
Consolidated 49.7 54.3 117.0 141.1
Equity 49.7 54.3 117.0 141.1
Production costs (in millions):
Costs applicable to sales $ 16 $ 15 $ 45 $ 45
Depreciation, depletion and
amortization $ 8 $ 7 $ 19 $ 19
Production costs (per ounce sold):
Direct mining and production costs $ 312 $ 259 $ 377 $ 306
By-product credits and other (13) (1) (10) (5)
Royalties and production taxes 17 12 17 13
Reclamation and mine closure costs 2 2 3 2
Costs applicable to sales $ 318 $ 272 $ 387 $ 316
Depreciation, depletion and
amortization $ 170 $ 126 $ 163 $ 131
JUNDEE
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons):
Open pit
Ore 94 454 635 1,024
Waste 2,184 5,420 4,288 10,301
Total 2,278 5,874 4,923 11,325
Underground 320 273 908 858
Tons milled (000 dry short tons) 630 640 1,823 1,901
Average ore grade (oz/ton) 0.154 0.144 0.136 0.141
Average mill recovery rate 92.8% 90.9% 92.2% 92.1%
Ounces produced (000):
Consolidated 90.4 83.4 230.3 249.4
Equity 90.4 83.4 230.3 249.4
Ounces sold (000):
Consolidated 89.7 82.8 229.3 248.9
Equity 89.7 82.8 229.3 248.9
Production costs (in millions):
Costs applicable to sales $ 32 $ 28 $ 85 $ 89
Depreciation, depletion and
amortization $ 7 $ 7 $ 18 $ 19
Production costs (per ounce sold):
Direct mining and production costs $ 316 $ 319 $ 343 $ 334
By-product credits and other 14 (1) 5 8
Royalties and production taxes 15 11 15 11
Reclamation and mine closure costs 4 4 5 4
Costs applicable to sales $ 349 $ 333 $ 368 $ 357
Depreciation, depletion and
amortization $ 76 $ 85 $ 77 $ 78
Operating Statistics - Tanami and Kalgoorlie
TANAMI
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons) 551 549 1,597 1,545
Tons milled (000 dry short tons) 741 980 2,344 3,308
Average ore grade (oz/ton) 0.150 0.120 0.136 0.120
Average mill recovery rate 95.0% 95.2% 95.1% 94.8%
Ounces produced (000):
Consolidated 103.0 112.0 301.5 380.3
Equity 103.0 112.0 301.5 380.3
Ounces sold (000):
Consolidated 103.0 111.9 301.6 385.5
Equity 103.0 111.9 301.6 385.5
Production costs (in millions):
Costs applicable to sales $ 39 $ 38 $ 113 $ 125
Depreciation, depletion and
amortization $ 8 $ 8 $ 21 $ 25
Production costs (per ounce sold):
Direct mining and production costs $ 317 $ 326 $ 321 $ 301
By-product credits and other (1) (1) (1) 3
Royalties and production taxes 60 15 51 17
Reclamation and mine closure costs 3 4 3 3
Costs applicable to sales $ 379 $ 344 $ 374 $ 324
Depreciation, depletion and
amortization $ 75 $ 66 $ 71 $ 64
KALGOORLIE
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons):
Open pit
Ore 1,728 1,926 5,323 5,800
Waste 9,943 10,059 29,419 27,870
Total 11,671 11,985 34,742 33,670
Underground 53 52 157 160
Tons milled (000 dry short tons) 1,627 1,819 4,801 5,545
Average ore grade (oz/ton) 0.064 0.064 0.064 0.070
Average mill recovery rate 84.7% 85.4% 84.3% 86.7%
Ounces produced (000):
Consolidated 79.7 87.5 255.2 299.9
Equity 79.7 87.5 255.2 299.9
Ounces sold (000):
Consolidated 80.4 90.7 256.1 300.2
Equity 80.4 90.7 256.1 300.2
Production costs (in millions):
Costs applicable to sales $ 39 $ 32 $ 122 $ 102
Depreciation, depletion and
amortization $ 6 $ 4 $ 19 $ 12
Production costs (per ounce sold):
Direct mining and production costs $ 463 $ 384 $ 458 $ 330
Capitalized mining -- (36) -- (2)
By-product credits and other (3) (2) (3) (2)
Royalties and production taxes 15 12 15 12
Reclamation and mine closure costs 6 3 6 3
Costs applicable to sales $ 481 $ 361 $ 476 $ 341
Depreciation, depletion and
amortization $ 74 $ 43 $ 73 $ 40
Operating Statistics - Martha
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons):
Open pit
Ore 128 325 845 878
Waste 85 307 160 713
Total 213 632 1,005 1,591
Underground 15 -- 63 --
Tons milled (000 dry short tons) 233 315 848 959
Average ore grade (oz/ton) 0.151 0.125 0.125 0.144
Average mill recovery rate 92.3% 93.5% 93.5% 92.9%
Ounces produced (000):
Consolidated 31.6 37.5 101.0 128.9
Equity 31.6 37.5 101.0 128.9
Ounces sold (000):
Consolidated 32.2 37.3 99.6 127.9
Equity 32.2 37.3 99.6 127.9
Production costs (in millions):
Costs applicable to sales $ 8 $ 8 $ 20 $ 22
Depreciation, depletion and
amortization $ 3 $ 3 $ 9 $ 12
Production costs (per ounce sold):
Direct mining and production costs $ 335 $ 248 $ 271 $ 220
Capitalized mining -- 11 -- 12
By-product credits and other (70) (65) (80) (66)
Royalties and production taxes 2 -- 1 --
Reclamation and mine closure costs 6 3 6 3
Costs applicable to sales $ 273 $ 197 $ 198 $ 169
Depreciation, depletion and
amortization $ 102 $ 91 $ 92 $ 97
Operating Statistics - Ahafo (1)
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons):
Open pit
Ore 2,411 -- 2,411 --
Waste 6,570 -- 6,570 --
Total 8,981 -- 8,981 --
Tons milled (000 dry short tons) 1,345 -- 1,345 --
Average ore grade (oz/ton) 0.059 -- 0.059 --
Average mill recovery rate 91.4% -- 91.4% --
Ounces produced (000):
Consolidated 77.9 -- 77.9 --
Equity 77.9 -- 77.9 --
Ounces sold (000):
Consolidated 77.3 -- 77.3 --
Equity 77.3 -- 77.3 --
Production costs (in millions):
Costs applicable to sales $ 19 -- $ 19 --
Depreciation, depletion and
amortization $ 6 -- $ 6 --
Production costs (per ounce sold):
Direct mining and production costs $ 235 -- $ 241 --
By-product credits and other (3) -- (9) --
Royalties and production taxes 18 -- 18 --
Reclamation and mine closure costs 1 -- 1 --
Costs applicable to sales $ 251 -- $ 251 --
Depreciation, depletion and
amortization $ 82 -- $ 82 --
1. Ahafo commenced commercial effective August 1, 2006
Operating Statistics - Golden Giant and La Herradura
GOLDEN GIANT
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons) -- 123 13 405
Tons milled (000 dry short tons) -- 121 17 405
Average ore grade (oz/ton) -- 0.317 0.627 0.294
Average mill recovery rate -- 96.5% 96.9% 96.0%
Ounces produced (000):
Consolidated 9.1 37.7 57.5 115.9
Equity 9.1 37.7 57.5 115.9
Ounces sold (000):
Consolidated 9.2 38.3 57.6 116.0
Equity 9.2 38.3 57.6 116.0
Production costs (in millions):
Costs applicable to sales $ 3 $ 11 $ 13 $ 35
Depreciation, depletion and
amortization -- $ 3 $ 1 $ 8
Production costs (per ounce sold):
Direct mining and production costs $ 73 $ 280 $ 173 $ 299
Capitalized mining and other 204 1 34 1
Royalties and production taxes (2) -- -- 1
Reclamation and mine closure costs 25 3 12 3
Costs applicable to sales $ 300 $ 284 $ 219 $ 304
Depreciation, depletion and
amortization -- $ 74 $ 10 $ 72
LA HERRADURA
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons):
Ore 1,029 884 3,045 2,793
Waste 3,814 2,879 10,025 7,349
Total 4,843 3,763 13,070 10,142
Tons processed (000 dry short tons) 1,029 884 3,045 2,793
Average ore grade (oz/ton) 0.023 0.024 0.023 0.028
Ounces produced (000):
Consolidated 14.6 20.6 61.3 61.2
Equity 14.6 20.6 61.3 61.2
Ounces sold (000):
Consolidated 21.1 20.6 61.3 61.2
Equity 21.1 20.6 61.3 61.2
Production costs (in millions):
Costs applicable to sales $ 5 $ 4 $ 15 $ 11
Depreciation, depletion and
amortization $ 3 $ 1 $ 7 $ 4
Production costs (per ounce sold):
Direct mining and production costs $ 246 $ 218 $ 247 $ 197
Capitalized mining -- (51) -- (28)
By-product credits and other (11) 1 (3) 1
Royalties and production taxes -- -- -- --
Reclamation and mine closure costs 2 2 2 2
Costs applicable to sales $ 237 $ 170 $ 246 $ 172
Depreciation, depletion and
amortization $ 131 $ 61 $ 109 $ 57
Operating Statistics - Kori Kollo
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2006 2005 2006 2005
-------- -------- -------- --------
Tons mined (000 dry short tons):
Ore 2,177 n/a 7,596 n/a
Waste 4,072 n/a 9,978 n/a
Total 6,249 n/a 17,574 n/a
Tons processed (000 dry short tons) 2,177 n/a 7,596 n/a
Average ore grade (oz/ton) 0.021 n/a 0.021 n/a
Ounces produced (000):
Consolidated 26.0 35.1 103.9 50.9
Equity 22.9 30.9 91.4 44.7
Ounces sold (000):
Consolidated 28.9 30.3 103.5 45.1
Equity 25.4 26.7 91.1 39.7
Production costs (in millions):
Costs applicable to sales $ 2 $ 5 $ 19 $ 9
Depreciation, depletion and
amortization $ 2 $ 1 $ 6 $ 2
Production costs (per ounce sold):
Direct mining and production costs $ 274 $ 125 $ 190 $ 161
By-product credits and other (17) (6) (11) (11)
Royalties and production taxes (182) 19 -- 19
Reclamation and mine closure costs 11 11 9 22
Costs applicable to sales $ 86 $ 149 $ 188 $ 191
Depreciation, depletion and
amortization $ 78 $ 33 $ 63 $ 32
Gold Derivative Position (September 30, 2006)
Maturity Summary (1, 2) (000 ounces)
Put Option Price Capped
Contracts (2) sales Contracts
----------------------- -----------------------
Year Ozs Price (3) Ozs Price (3)
- ------------- ---------- ---------- ---------- ----------
2006 10 $ 393 -- --
2007 20 $ 397 -- --
2008 -- -- 1,000 $ 384
2009 -- -- 600 $ 381
2010 -- -- -- --
2011 -- -- 250 $ 392
Total/Average 30 $ 396 1,850 $ 384
(1) For more detailed descriptions, definitions and explanations, refer to
the Company's Annual Report on form 10-K/A for the year ended
December 31, 2005, filed on October 26, 2006.
(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) The gold put option contracts had a negative mark-to-market value of
$1.6 million at September 30, 2006. The price capped contracts had a
negative mark-to-market of $486 million at September 30, 2006.
The Company's third quarter earnings conference call and web cast
presentation will be held on November 1, 2006 beginning at 4:00 p.m. Eastern
Time (2:00 p.m. Mountain Time). To participate:
Dial-In Number: 210.839.8506
Leader: John Gaensbauer
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.
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 copper production
and sales; (ii) estimates of future costs applicable to sales; (iii) estimates
of future capital expenditures, royalty and dividend income, tax rates and
expenses; (iv) estimates regarding timing of future development, construction,
production or closure activities; (v) statements regarding future exploration
results and the replacement of reserves; (vi) statements regarding cost
structure and competitive position; and (vii) statements regarding the Fort a la
Corne JV diamond project. 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 2005 Annual Report on Form 10-K/A, filed October 26,
2006, 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- 11/01/2006
/CONTACT: Investors and Media, Randy Engel, +1-303-837-6034,
randy.engel@newmont.com, or John Gaensbauer, +1-303-837-5153,
john.gaensbauer@newmont.com, or Seth Foreman, +1-303-837-5247,
seth.foreman@newmont.com, all of Newmont Mining Corporation/
/Web site: http://www.newmont.com /
(NEM)