Higher gold prices combined with increased production from its Gold Quarry mine in the Carlin gold belt of Nevada, to give Newmont Gold Co. a third quarter earnings boost.
Newmont says 1987 third quarter net income was $23(US) million or 22 cents per share compared with $12.5 million or 13 cents per share during the same period in 1986.
Net income for the first nine months of 1987 was $62 million (60 cents per share), up from $26.3 million (27 cents per share) in 1986.
As a result, Newmont Gold has declared a dividend of $0.05 per share of common stock, payable on Dec 10 to shareholders of record on Nov 25.
According to the company, gold sales were up 13% from 130,900 in the 1986 quarter to 147,300 oz. The price received for that gold was $462 per oz compared with $375 in the 1986 third quarter. However, a 50% increase in the cash cost of gold production from $163 in 1986 to $207 per oz in 1987 was due to higher royalties caused by a higher selling price, Newmont says.
The cost of mining lower grade ore also pushed production costs up.
During the recent quarter, 11.3 million tons were mined compared with 7.3 million tons in the third quarter of 1986. The company also placed 2.6 million tons of ore on leach pads. That was also a substantial increase from 1.1 million in 1986.
A 90%-owned subsidiary of New York-based Newmont Mining Corp., Newmont Gold has the largest announced gold reserves in North America and in 1988 it expects to become the largest gold producer on the American continent.
During the recent takeover bid for Newmont Mining by Texas oilman T. Boone Pickens, Newmont Gold announced reserves of 14 million oz gold in the ground.
Be the first to comment on "Newmont Gold increases third quarter income"