Newcrest share price up 5% on strong Q1 update

The Newcrest Mining Ltd (ASX: NCM) share price is charging higher on Thursday morning.

At the time of writing, the gold miner’s shares are up 5% to $18.25.

Why is the Newcrest share price charging higher?

The catalyst for the rise in the Newcrest share price has been the release of the gold miner’s quarterly update this morning.

For the three months ended 30 September, Newcrest reported gold production of 527koz and copper production of 32kt. While this was down on the prior corresponding period, this was due partly to planned maintenance.

Importantly, the company remains on track to achieve its annual guidance following the quarter. Particularly given its expectation for gold and copper production to increase in the December quarter.

FY 2023 gold production guidance remains 2,100koz to 2,400koz and copper production guidance is steady at 135kt to 155kt.

One negative, though, was that Newcrest’s production was achieved at an all-in sustaining cost (AISC) of $1,098 per ounce, delivering an AISC margin of $579 per ounce.

This AISC was 23% higher than the prior period, driven by lower gold and copper sales volumes with lower production following planned maintenance, and a lower realised copper price. This was partly offset by the benefit of a weakening Australian and Canadian dollar on operating costs.

Management notes that with a significant proportion of operating costs exposed to the Australian and Canadian dollars, continued weakness of these currencies against the US dollar will favourably impact its AISC.

Management commentary

Newcrest’s managing director and CEO, Sandeep Biswas, commented:

While overshadowed by the upsetting news from Brucejack, Newcrest delivered a solid performance during the September quarter which reflected our normal cadence for planned major maintenance shutdowns across our operations during this period.

Our group gold and copper production has increased substantially from a year ago, reflecting maintenance and productivity improvements at Cadia and Lihir, and additional ounces from Brucejack. Following this strong start to the year we expect gold and copper production to be higher in the December quarter on lower planned maintenance and remain on track to meet FY23 guidance.

The post Newcrest share price up 5% on strong Q1 update appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro 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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