Newcrest share price up on quarterly results and exploration activities report

A man clenches his fists in excitement as gold coins fall from the sky.A man clenches his fists in excitement as gold coins fall from the sky.

The Newcrest Mining Ltd (ASX: NCM) share price is climbing today after the gold miner released an operational update and an overview of its exploration activities for the June quarter.

At the time of writing, Newcrest shares are up 1.3% today to $2.34 apiece.

Let’s review what the gold share told the ASX today.

Newcrest share price in the green

Newcrest Mining said it achieved its gold production guidance for FY22 at a lower cost than expected.

The company’s copper production was 3% lower than guidance. Its all-in sustaining costs (AISC) were 2% higher.

Here are the highlights from Newcrest’s report:

  • FY22 gold production guidance achieved
  • June quarter gold production of 637koz2
  • June quarter copper production of 39kt
  • FY22 gold production of 1,956koz
  • FY22 copper production of 121kt
  • June quarter AISC of $896/oz2, delivering an AISC margin of $958/oz3
  • FY22 AISC of $1,044/oz, delivering an AISC margin of 41% or $732/oz3 for the financial year.

What happened in Q4 FY22 for Newcrest Mining?

Newcrest provided some updates regarding its individual mines:

  • Cadia achieved its lowest ever annual AISC of negative $124/oz
  • Brucejack transformation program is progressing well, with an uplift road map update expected to be released in August
  • Two-stage Cadia Expansion Project and Lihir Front End Recovery Project on track for completion by the end of September
  • Cadia PC1-2 feasibility study is expected to be released in the September 2022 quarter
  • Red Chris Block Cave and Havieron Stage 1 feasibility studies are on track, with works advancing on both projects
  • Strong drilling results at Brucejack, Red Chris, and Havieron, continuing the expansion of the high-grade footprints
  • Newcrest Sustainability Fund of A$10 million established to drive social investments in support of the United Nations Sustainable Development Goals.

Newcrest also reviewed its injury rates in the quarter.

The company said: “Injury rates were higher than the prior period at Cadia, Telfer, and Red Chris. The Safe Hands intervention program continues to focus on reducing the risk of hand injuries across Newcrest sites.”

What did management say?

Commenting on the results that seem to have had a positive effect on the Newcrest share price today, managing director and CEO Sandeep Biswas said:

Newcrest delivered a strong fourth quarter to achieve our group gold production for the year. Over the last four quarters we have steadily increased our gold and copper production, driving lower group All-In Sustaining Costs and delivering a record breaking annual cost performance at Cadia.

We were particularly pleased to record a fourth consecutive quarter of lower group costs during this challenging inflationary environment.

Our Respect@Work program continued to progress during the quarter with Newcrest focused on creating a workplace where everyone feels safe, respected and valued.

We also established our Newcrest Sustainability Fund this month, highlighting our commitment to achieving a better and more sustainable future for all our people, and the wider communities in which we operate.

What’s next for Newcrest Mining?

Biswas said the company was advancing multiple organic growth options:

As we move into FY23, we will continue to progress our exciting pipeline of organic growth projects, remaining focused on superior operational performance with an unwavering commitment to the health and safety of our people.

Newcrest Mining will release its guidance for FY23 along with its full-year FY22 results on 19 August during earnings season.

The company said the guidance will “outline Newcrest’s views of the risk of cost inflation on AISC and capital expenditure, and the associated mitigation strategies underway”.

Over the three months to 30 June, the Newcrest share price lost 22%. This compares to a 12% dip for the S&P/ASX 200 Index (ASX: XJO).

The ASX 200 gold share has a market capitalisation of $17 billion.

The post Newcrest share price up on quarterly results and exploration activities report appeared first on The Motley Fool Australia.

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Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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