Reuters
Newmont Profit Rises on Gold Prices
Wednesday October 29, 8:46 am ET
NEW YORK (Reuters) - Newmont Mining Corp. (NYSE:NEM - News), the world's largest gold miner, said on Wednesday its third-quarter profit rose sharply, as gold prices and margins increased.
The Denver company reported third-quarter net income of $114.4 million, or 28 cents per share, up from net income of $20.8 million, or 5 cents a share, in the year-ago quarter.
Analysts had forecast earnings per share of 17 to 37 cents, with a consensus estimate of 25 cents a share, according to Reuters Research, a unit of Reuters Group Plc.
Revenue in the quarter rose 22 percent to $897 million.
Gold is regarded as a safe haven when the U.S. dollar weakens. A fall in the greenback also makes dollar-denominated gold cheaper to buy in other currencies. The price of bullion has risen some 12 percent so far this year, mostly on U.S. dollar weakness.
The average realized gold price for the third quarter was $366 per ounce, a 16 percent increase over the prior year period, Newmont said. Newmont said it sold 2.06 million equity ounces of gold, essentially unchanged from the 2.08 million equity ounces sold a year ago.
For the full year, Newmont expects to be at the higher end of its previous gold sales forecast of between 7.2 million and 7.4 million ounces.
Shares of Newmont closed Tuesday trade on the New York Stock Exchange (News - Websites) at $42.75. During the quarter, they rose nearly 50 percent, underperforming the AMEX gold bugs index (AMEX:^HUI - News) which increased almost 58 percent in the same period.
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