DENVER — Newmont Mining Corp., one of the world’s largest gold producers, said today its third-quarter earnings doubled on one-time gains and improved operations.
Rising costs, however, prompted the company to cut its gold sale expectations for the full year.
Shares of the Denver-based company rose 8 percent in morning trading.
For the quarter ended Sept. 30, Newmont reported net income of $397 million, or 88 cents per share, compared with $198 million, or 44 cents per share, in the third quarter of 2006. Revenue totaled $1.65 billion, up from $1.1 billion in the year-ago quarter.
The most recent results included an $84 million gain related to foreign tax credits and a $54 million after-tax gain from a settlement on its Zarafshan-Newmont joint venture.
Analysts polled by Thomson Financial on average had forecast a profit of 25 cents per share on revenue of $1.4 billion. Analyst estimates typically exclude one-time items.
“They obviously had a lot of good things happening at numerous operations, I thought, in terms of doing better than the market had expected,” said Barnard Jacobs Mellet analyst Patrick Chidley.
“It certainly is much better than most people were expecting.” During the quarter, Newmont’s equity gold sales totaled 1.33 million ounces, down from 1.38 million ounces in the third quarter of 2006. The average realized gold price was $681 an ounce, up from $611 an ounce while costs applicable to sales rose to $388 an ounce from $318 an ounce.
For the full year, Newmont has forecast equity gold sales of between 5.2 million and 5.4 million ounces and costs applicable to sales of between $400 and $430 per ounce.
Previously, it projected equity gold sales of 5.2 million to 5.6 million equity ounces with costs at $375 to $400 per ounce. The company said late last month that production costs might run higher than expected in 2007 while reserves are depleting.
In the first nine months, Newmont reported a net loss of $1.6 billion, or $3.54 a share, compared with net income of $568 million, or $1.26 a share, in the comparable period of 2006.
Revenue increased to $4.2 billion from $3.5 billion in the year-ago period.
Newmont’s stock rose $3.76 to $50.20 a share in late morning trading. In the past year, it has ranged between $47.14 a share and $48.42 a share.
