Newmont (NYSE: NEM, TSX: NGT) said on July 29 that higher gold prices helped generate significant free cash flow in the second quarter of 2020.
The world’s largest gold miner’s adjusted net income for the June quarter was $261 million, or 32¢ per diluted share, compared with $92 million, or 12¢ per diluted share, in the prior-year quarter. The results topped analysts’ estimates of 31¢ per share.
Newmont reported $984 million in adjusted EBITDA and $388 million in free cash flow.
Revenue rose 5% from the prior-year quarter to $2.37 billion, helped by record-high gold prices.
Newmont’s averaged realized gold price jumped about 31% to $1,724 per oz. in the second quarter ended June 30.
Its attributable gold production, however, fell 21% to 1.26 million oz., as coronavirus lockdowns led to the temporary closure of some of its mine sites.
“We safely and efficiently executed restart plans at our mines previously in care and maintenance, and Newmont’s world-class portfolio is well-positioned to deliver an even stronger second half of 2020,” chief executive officer Tom Palmer said in a media statement.
“The ongoing favourable gold price environment amplifies our free cash flow generation, yet our discipline around capital allocation will not change as we continue to invest in profitable projects,” Palmer said.
Newmont plans to spend $45 million per month to maintain safety protocols at its mines in Mexico, Peru and Argentina, Palmer said.
The company reaffirmed its revised guidance issued on May 19. The miner’s 2020 attributable gold production remains at about six-million ounces.