(Reuters) -Newmont, the world’s top gold producer, missed Wall Street expectations for third-quarter profit on Wednesday, as higher costs and lower production in Nevada took the shine away from a rise in total output.
Shares of the company fell 6.8% after the bell.
Newmont said that its costs rose due to planned maintenance at the Lihir project in Papua New Guinea — which it acquired following a $17 billion buyout of Newcrest — and higher expenditure for contract services across its portfolio.
All-in-sustaining-costs for gold, an industry metric reflecting total expenses, rose to $1,611 per ounce in the July-September quarter, from $1,426 per ounce a year ago.
The Denver, Colorado-based company’s attributable production at the Nevada Gold Mines declined by 19.3% to 242,000 ounces during the third quarter, compared to the year-ago quarter.
Newmont owns a non-operating minority stake in Nevada Gold Mines, along with rival Barrick Gold, whose third-quarter production fell short of Wall Street expectations earlier this month due to lower output at the Nevada mines.
However, the company’s total gold production rose 29.2% to 1.67 million ounces, primarily due to higher production at the Cerro Negro mine in Argentina, where production had suffered earlier due to the death of two workers.
The market had estimated the miner to produce about 1.64 million ounces of gold during the reported period.
Newmont also said it expects to produce 1.8 million gold ounces in the fourth quarter, its highest output of the year, and remained on track to reach its target of receiving $2 billion from divestment proceedings.
The company posted adjusted profit of 81 cents per share, compared to analysts’ expectations of 86 cents per share, according to data compiled by LSEG.
(Reporting by Vallari Srivastava and Sourasis Bose in Bengaluru; editing by Alan Barona)
