Newmont Corporation — A high-dividend safe haven

Newmont Corporation (TSX: NEM)

Currency in -

Last close As at 04/02/2023

-49.58

2.21 (4.67%)

Market capitalisation

USD37,703m

Research: Metals & Mining

Newmont Corporation — A high-dividend safe haven

Newmont’s Q222 results are scheduled for release on 25 July. This report updates our forecasts for Q2–Q422 for metals prices and production costs, as well as output from Nevada Gold Mines (NGM) and Pueblo Viejo, which were announced by Barrick on 14 July.

Lord Ashbourne

Written by

Lord Ashbourne

Director, Energy & Resources

Metals & Mining

Newmont Corporation

A high-dividend safe haven

Q222 results preview

Metals and mining

19 July 2022

Price

US$54.81

Market cap

US$43,464m

Net debt (US$m) at end-March 2022

1,938

Shares in issue

793.0m

Free float

99.8%

Code

NEM

Primary exchange

NYSE

Secondary exchange

TSX

Share price performance

%

1m

3m

12m

Abs

(14.0)

(35.8)

(11.2)

Rel (local)

(17.5)

(26.4)

0.3

52-week high/low

US$85.4

US$53.3

Business description

Founded in 1916, Newmont Corporation is the world’s leading gold company with a world-class portfolio of assets in North and South America, Australia and Africa. It is the only gold producer in the S&P 500 Index and is widely recognised for its ESG practices and as a leader in value creation, safety and mine execution.

Next events

Q222 results

July 2022

Denver Gold conference

September 2022

Q322 results

October 2022

Yanacocha Sulphides decision

H222

Analyst

Lord Ashbourne

+44 (0)20 3077 5724

Newmont Corporation is a research client of Edison Investment Research Limited

Newmont’s Q222 results are scheduled for release on 25 July. This report updates our forecasts for Q2–Q422 for metals prices and production costs, as well as output from Nevada Gold Mines (NGM) and Pueblo Viejo, which were announced by Barrick on 14 July.

Year end

Revenue (US$m)

PBT
(US$m)

EPS*
(US$)

DPS
(US$)

P/E
(x)

Yield
(%)

12/20

11,497

3,143

2.66

1.45

20.6

2.6

12/21

12,222

1,108

2.97

2.20

18.5

4.0

12/22e

11,980

2,374

2.23

2.20

24.6

4.0

12/23e

12,034

2,615

2.09

2.20

26.2

4.0

Note: *EPS are normalised, excluding amortisation of acquired intangibles and exceptional items.

Metals prices in retreat

While the gold price has fallen by US$113/oz, or 6.2%, to US$1,710/oz since our last note on Newmont in May (see Empowering sustainability, published on 17 May), it remains consistent with our longer-term expectations at a time when the Federal Reserve wants to be seen to be taking aggressive action against the possibility of protracted inflation. Other metal prices have, in fact, fallen further than the gold price over the same timeframe, which will also weigh on Newmont’s revenues (as co-products) and costs (as by-products) at a time when inflationary pressure in the industry is, in general, increasing. While this has caused us to reduce our EPS forecasts for the remainder of the year, we do not believe that it will compromise Newmont’s quarterly dividend. Note that we are forecasting that Newmont will have the 24th highest yield of any precious metals mining company in CY22 (out of a sector of 1,303).

Valuation: Dividend yield hits 4%

Using a real discount rate of 6.47% (cf 6.36% previously), our ‘terminal’ valuation of Newmont at end-FY27 is US$74.84/share cum-dividend (cf US$77.76/share previously). This is at a 36.5% premium to Newmont’s current share price of US$54.81. However, note that this valuation is based on the inherently conservative assumption of zero growth in (real) cash flows beyond FY27. The valuation increases to US$106.85/share in FY27 if the growth in real cash flows thereafter amounts to just 2.0% per annum (ie the minimum that might reasonably be expected given the average historical annual increase in the real gold price of 2.0% pa) and to US$81.10/share as at the start of FY22. This valuation is also conservative in that it assumes that the long-term price of gold will decline from current levels to US$1,524/oz in real terms by FY27 (before levelling out). If the gold price instead remains at current levels in real terms (US$1,710/oz at the time of writing), our valuation increases to US$77.24/share cum-dividend in FY27 and to US$60.77/share in FY22. In the meantime, in both historical and relative terms, Newmont remains cheap with respect to its dividend yield. Based on consensus forecasts, we calculate that its share price would have to rise by an average of 32.4% for its dividend yield to match those of its peer group. Based on our forecasts, we estimate its share price would have to rise by 25.9%.

Updated Q222 forecasts

Newmont’s Q222 results are expected to be released in the week commencing 25 July. After the end of the quarter however, for the purposes of this report, we have updated our assumptions for metals prices, costs and production from NGM and Pueblo Viejo, which were announced by their operator, Barrick, on 14 July.

A summary of the changes in our metals prices assumed for both Q222 and the remainder of the year is as follows:

Exhibit 1: Edison FY22 metals price forecasts

Metal (units)

Q222 price forecast

Remainder of FY22 price forecast

Previous forecast

Current forecast

Change
(%)

Previous forecast

Current forecast

Change
(%)

Gold (US$/oz)

1,866

1,866

0.0

1,823

1,710

-6.2

Silver (US$/oz)

22.64

22.63

0.0

21.59

18.60

-13.8

Zinc (US$/lb)

1.73

1.75

+1.2

1.58

1.34

-15.2

Lead (US$/lb)

0.99

1.00

+1.0

0.93

0.89

-4.3

Copper (US$/lb)

4.32

4.31

-0.2

4.15

3.32

-20.0

Simple average

+0.4

-11.9

Source: Edison Investment Research

As in FY21, Newmont expects both (higher) production and (lower) costs to be weighted towards the second half of the year in FY22, approximately in the ratio 47:53. For the purposes of this report, we have left our production forecasts unchanged for the quarter, with the exception of production from NGM and Pueblo Viejo, which were announced by Barrick last week. We have also adjusted our cost assumptions to reflect continuing inflationary pressure into Q2, which we also expect to persist for the remainder of the year. While this cost pressure relates to the obvious categories, such as commodities and diesel, in this case we also believe that it has manifested itself in a tight market for specialised labour, especially in Canada and Australia. Given this environment, a summary of our updated production and cost assumptions for Q2 and for the remainder of the year is as follows:

Exhibit 2: Newmont Q122–Q422e operational estimates

Region

Production (koz)

Costs applicable to sales (US$/oz)

Q122

Q222e

Q322e

Q422e

FY22e

Q122

Q222e

Q322e

Q422e

FY22e

Updated

North America

309

343

418

374

1,444

995

920

814

913

904

South America

198

194

220

220

832

921

920

819

819

868

Australia

282

319

380

380

1,361

764

804

676

676

725

Africa

198

236

261

280

975

871

962

895

832

889

Nevada

288

289

307

307

1,192

899

838

849

849

858

Sub-total

1,275

1,381

1,586

1,561

5,805

890

884

802

815

845

Pueblo Viejo (40%)

69

70

70

70

279

Total (attributable) gold

1,344

1,451

1,656

1,631

6,083

Prior

North America

309

343

418

374

1,444

995

870

770

864

866

South America

198

194

220

220

832

921

920

819

819

868

Australia

282

319

380

380

1,361

764

773

650

650

703

Africa

198

236

261

280

975

871

962

871

810

876

Nevada

288

307

307

307

1,210

899

848

849

849

860

Sub-total

1,275

1,399

1,586

1,561

5,822

890

867

781

793

829

Pueblo Viejo (40%)

69

71

71

71

282

Total (attributable) gold

1,344

1,470

1,657

1,632

6,103

Source: Newmont Corporation, Edison Investment Research. Note: Totals may not add up owing to rounding.

In addition, we have adjusted our financial forecasts to reflect Newmont’s announcement, on 5 July, that it had reached a profit-sharing agreement at Peñasquito, whereby it will pay its represented workforce an uncapped profit-sharing bonus up to 10%, with an immediate cost equivalent to US$70m related to FY21, which we understand will be recognised in Q222 and not adjusted out. In the light of these changes, our updated financial forecasts for Newmont for FY22, by quarter, are as follows:

Exhibit 3: Newmont quarterly income statement, Q121–Q422e

US$m (unless otherwise indicated)

Q122

Q222e
(prior)

Q222e
(current)

Q322e
(prior)

Q322
(current)

Q422e
(prior)

Q422e
(current)

FY22e

FY22e
(prior)

Sales

3,023

3,000

2,969

3,246

3,019

3,246

2,970

11,980

12,516

Costs and expenses

– Costs applicable to sales

1,435

1,409

1,488

1,430

1,465

1,430

1,465

5,852

5,704

– Depreciation and amortisation

547

593

585

666

666

668

668

2,466

2,474

– Reclamation and remediation

61

42

42

42

42

42

42

188

188

– Exploration

38

70

70

70

70

70

70

248

248

– Advanced projects, research and development

44

43

43

43

43

43

43

172

172

– General and administrative

64

65

65

65

65

65

65

259

259

– Impairment of long-lived assets

0

0

0

0

0

0

0

0

0

– Care and maintenance

0

0

0

0

0

0

0

0

0

– Loss on assets held for sale

– Other expense, net

35

18

18

18

18

18

18

87.5

87.5

Total

2,224

2,239

2,310

2,333

2,368

2,336

2,371

9,272

9,131

Other income/(expenses)

– Gain on formation of Nevada Gold Mines

0

0

– Gain on asset and investment sales, net

0

0

– Other income, net

(109)

0

0

0

0

0

0

(109)

(109)

– Interest expense, net of capitalised interest

(62)

(57)

(54)

(57)

(55)

(49)

(53)

(225)

(225)

(171)

(57)

(54)

(57)

(55)

(49)

(53)

(334)

(334)

Income/(loss) before income and mining tax

628

704

605

857

596

862

546

2,374

3,050

Income and mining tax benefit/(expense)

(214)

(225)

(194)

(274)

(191)

(276)

(175)

(773)

(989)

Effective tax rate (%)

34.1

32.0

32.0

32.0

32.0

32.0

32.0

32.5

32.4

Profit after tax

414

478

411

583

405

586

371

1,602

2,061

Equity income/(loss) of affiliates

39

31

29

29

24

28

23

115

126

Net income/(loss) from continuing operations

453

509

441

611

429

614

394

1,717

2,187

Net income/(loss) from discontinued operations

16

16

16

Net income/(loss)

469

509

441

611

429

614

394

1,733

2,203

Minority interest

21

14

14

16

14

16

14

62

67

Ditto (%)

4.5

2.7

3.2

2.6

3.2

2.6

3.5

3.6

3.0

Net income/(loss) attributable to stockholders

448

495

427

596

415

598

380

1,670

2,137

Adjustments to net income

98

0

0

0

0

0

0

98

98

Adjusted net income

546

495

427

596

415

598

380

1,768

2,235

Net income/(loss) per common share (US$)

Basic

– Continuing operations

0.545

0.625

0.538

0.751

0.524

0.754

0.480

2.086

2.674

– Discontinued operations

0.020

0.000

0.000

0.000

0.000

0.000

0.000

0.020

0.020

– Total

0.565

0.625

0.538

0.751

0.524

0.754

0.480

2.106

2.695

Diluted

– Continuing operations

0.544

0.624

0.537

0.750

0.523

0.753

0.479

2.083

2.671

– Discontinued operations

0.020

0.000

0.000

0.000

0.000

0.000

0.000

0.020

0.020

– Total

0.564

0.624

0.537

0.750

0.523

0.753

0.479

2.104

2.691

Basic adjusted net income per share (US$)

0.689

0.625

0.538

0.751

0.524

0.754

0.480

2.230

2.818

Diluted adjusted net income per share (US$)

0.688

0.624

0.537

0.750

0.523

0.753

0.479

2.227

2.815

DPS (US$/share)

0.550

0.550

0.550

0.550

0.550

0.550

0.550

2.200

2.200

Source: Newmont Corporation, Edison Investment Research

Our basic adjusted EPS forecast of US$2.230/share (vs US$2.818/share previously) for FY22 compares to the market consensus, by quarter, as follows:

Exhibit 4: FY22 basic adjusted EPS forecast, Edison versus consensus (US$/share)

Q122

Q222e

Q322e

Q422e

Sum Q1–Q422e

FY22e

Edison forecast

0.689

0.538

0.524

0.480

2.231

2.230

Consensus forecast

0.689

0.680

0.840

0.860

3.069

3.060

High

0.689

0.980

1.110

1.080

3.859

3.790

Low

0.689

0.460

0.720

0.700

2.569

2.460

Source: Edison Investment Research, Refinitiv (19 July 2022)

Although our forecasts are now below the bottom of the analysts’ range, we believe that this adequately reflects the recent declines in the gold price, which we suspect may not yet be factored in to all other analysts’ estimates.

While Edison also does not make explicit cash flow forecasts on a quarterly basis, readers should note that Newmont typically experiences higher than average cash tax payments in the second quarter of any financial year (as in the first quarter) as a result of the ‘truing up’ process. In Q222, it also closed its acquisition of a 5% stake in Yanacocha from Sumitomo for US$48m, which will result in a further short-term outflow of cash (albeit in the form of a long-term investment).

Dividend

Newmont’s dividend for Q122 was maintained at US$0.55/share. At the time of its Q320 results in October 2020, Newmont unveiled a new dividend framework whereby it formally rebased its dividend to a ‘base’ payout of US$1.00/share (or US$0.25/share per quarter) at a gold price of US$1,200/oz, but also stated explicitly that it would return 40–60% of incremental attributable free cash flow that it generated above a gold price of US$1,200/oz to shareholders. Under this framework, Newmont then augments its ‘base’ payout in increments of US$0.60–0.90/share per year (or US$0.15–0.225/share per quarter), evaluated in gold price increments of US$300/oz for gold prices above US$1,200/oz, with the goal of targeting 40–60% of incremental free cash flow above a gold price of US$1,200/oz returned to shareholders. Thus, a (sustainable) gold price at US$1,800/oz should (on this basis) result in a quarterly dividend of US$0.55/share, whereas a gold price below that level could result in one of US$0.40/share. However, it is worth noting that Newmont affords itself a degree of latitude in the level of the ultimate payout in that, should it decide to pay out nearer 60% of incremental attributable free cash flow to shareholders that it generates above a US$1,200/oz gold price, rather than 40%, then there is scope for the quarterly dividend to remain at the higher level (ie US$0.55/share) even if the gold price dips below the US$1,800/oz level. As such, we have left our dividend forecasts unchanged for the remainder of FY22 notwithstanding the fact that the gold price is, at the time of writing, below US$1,800/oz.

Valuation

Our approach to the valuation of Newmont has remained unchanged since our initiation note (see The sustainable leader, published on 9 February 2021) and readers are directed to this note for a fuller explanation of the methodologies involved. The following is an update of our valuation in light of our updated forecasts for FY22.

Absolute valuation and sensitivities

Newmont is a multi-asset company that has shown a willingness and desire to trade assets in the past to maintain production, reduce costs and maximise shareholder returns. As a result, rather than our customary method of discounting maximum potential dividends over the life of operations back to FY22, in the case of Newmont, we have opted to discount forecast dividends back over six years from the start of FY22 and to then apply an ex-growth terminal multiple to forecast cash flows in that year (FY27) based on the appropriate discount rate. In the normal course of events, we would exclude exploration expenditure from such a calculation on the basis that it is a discretionary investment. In the case of Newmont, however, we have included it in our estimate of future cash flows on the grounds that it will be a critical component of ongoing business performance in its ability to continually expand and extend the lives of the company’s assets via exploration.

In this case, our estimate of Newmont’s ‘terminal’ pre-financing cash flow in FY27 has moderated, very slightly, from US$4.39/share to US$4.35/share. On this basis, applying a (real) discount rate of 6.47% (calculated from a nominal expected equity return of 9% and decreased long-term inflation expectations of 2.2376% cf 2.4867% previously, as defined by the US 30-year break-even inflation rate – source: Bloomberg, 19 July), our terminal valuation of the company at end-FY27 is US$74.84/share cum-dividend (cf US$77.76/share previously). However, note that this valuation is based on the inherently conservative assumption of zero growth in (real) cash flows beyond FY27. The valuation increases to US$106.85/share if growth in real cash flows after FY27 amounts of 2.0% per annum (ie the minimum that might be expected from the average historical annual increase in the real price of gold of 2.0% pa) and to US$81.10/share as at the start of FY22. It should also be noted that our valuation is inherently conservative in that it assumes that the long-term price of gold will decline from current levels to US$1,524/oz in real terms by FY27 (before levelling out). If the gold price instead remains at current levels in real terms (US$1,710/oz at the time of writing), our valuation increases to US$77.24/share cum-dividend in FY27 and to US$60.77/share currently in FY22 (with the added assumption that mining at NGM does not then revert to the reserve grade in that year on account of the relatively high sustained level of the gold price).

Note that this (absolute) analysis inherently excludes any value to Newmont from its other development assets, such as Coffee, Galore Creek, Conga, Norte Abierto and Nueva Union, which together represent combined reserves and resources of 53.94Moz attributable to Newmont.

Relative Newmont valuation

Newmont’s valuation on a series of commonly used measures, relative to its peer group of the 10 largest publicly quoted senior gold producers, is as follows.

Exhibit 5: Newmont valuation relative to peers

Company

Ticker

P/E (x)

P/cash flow (x)

EV/EBITDA (x)

Yield (%)

Year 1

Year 2

Year 3

Year 1

Year 2

Year 3

Year 1

Year 2

Year 3

Year 1

Year 2

Year 3

Newmont (Edison)

NEM

24.6

26.2

26.6

10.9

10.0

8.9

8.6

8.2

7.4

4.0

4.0

2.9

Newmont (consensus)

NEM

17.9

18.0

19.5

9.1

8.6

8.4

7.4

7.3

7.3

4.0

3.8

3.6

Barrick

ABX

14.4

13.7

14.0

6.2

5.8

5.7

5.8

5.4

5.3

4.4

5.6

5.7

AngloGold

ANGJ

8.1

6.0

7.0

4.8

4.1

3.9

3.7

3.1

3.3

2.4

2.9

3.0

Polyus

PLZL MM

6.7

6.7

5.2

5.0

4.3

4.4

4.7

4.7

3.7

4.7

7.4

9.2

Gold Fields

GFI

8.3

8.0

8.0

4.6

4.5

4.1

3.9

3.5

3.8

3.8

3.6

3.6

Kinross

K

8.1

7.1

9.0

2.9

2.7

3.1

3.9

3.4

3.9

3.7

3.7

3.8

Agnico-Eagle

AEM

18.6

18.9

18.0

7.7

7.4

7.5

6.6

6.4

6.6

3.0

3.7

3.7

Newcrest

NCM AU

12.8

10.7

13.8

9.0

5.8

6.4

6.2

4.9

5.6

1.8

2.3

2.3

Harmony

HARJ

9.1

6.0

6.5

5.2

3.3

4.1

3.9

2.7

3.2

0.8

1.5

3.6

Endeavour (consensus)

EDV

10.8

10.6

9.3

4.0

4.3

3.9

3.8

4.0

3.8

3.4

3.6

3.9

Average (excl NEM)

10.8

9.7

10.1

5.5

4.7

4.8

4.7

4.2

4.3

3.1

3.8

4.3

Source: Edison Investment Research, Refinitiv. Note: Consensus and peers priced on 19 July 2022.

From the table above, it can also be seen that while Newmont continues to command a premium rating relative to its peer group on most valuation measures, it remains cheap with respect to its dividend yield in a majority of instances. Based on consensus forecasts, we estimate that Newmont’s share price would have to rise by an average of 32.4% for its dividend yield to match those of its peers. Based on our forecasts, we estimate its share price would have to rise 25.9%.

As previously, one further observation concerning the comparability of the above measures is merited. Given its policy of proportionately consolidating its interest in NGM and that it owns 100% interests in the majority of its remaining mining operations (with the exception of Merian), estimates of cash flow in particular are also close to estimates of cash flow attributable to shareholders (Newmont estimates that 99.8% of free cash flow was attributable to the company in FY21). This is in contrast to a number of its peers, where earnings and cash flow from assets not 100%-owned tend to be fully consolidated and therefore may not so easily approximate cash flow attributable to shareholders, making direct comparison using these measures either difficult or, potentially, misleading.

Historical valuation

Based on Newmont’s average historical P/E ratio of 23.9x current year earnings over the past nine years, from FY13 to FY21, and its average historical yield of 1.7% over the same timeframe (excluding special dividends), a summary of our updated valuation of the company over 12 measures of value over the next three years is as follows:

Exhibit 6: Newmont valuation summary (US$/share in years shown)

Basis of valuation

FY22e

FY23e

FY24e

Historical

Share price implied by Edison EPS forecast (US$/share)

53.23

50.00

49.13

Historical

Share price implied by Edison DPS forecast (US$/share)

127.02

127.02

92.38

Historical

Share price implied by consensus EPS forecast (US$/share)

73.04

72.81

67.08

Historical

Share price implied by consensus DPS forecast (US$/share)

127.02

121.82

112.58

Average (US$/share)

95.08

92.91

80.29

Source: Edison Investment Research (underlying consensus data: Refinitiv, 19 July 2022).

Exhibit 7: Financial summary

Accounts: US GAAP; year-end 31 December; US$m

 

 

2018

2019

2020

2021

2022e

2023e

2024e

2025e

INCOME STATEMENT

 

 

 

 

 

 

 

 

 

 

Total revenues

 

 

7,253

9,740

11,497

12,222

11,980

12,034

12,176

11,809

Cost of sales

 

 

(4,093)

(5,195)

(5,014)

(5,435)

(5,852)

(5,619)

(5,816)

(5,825)

Gross profit

 

 

3,160

4,545

6,483

6,787

6,128

6,415

6,360

5,983

SG&A (expenses)

 

 

(244)

(313)

(269)

(259)

(259)

(260)

(260)

(260)

R&D costs

 

 

(350)

(415)

(309)

(363)

(420)

(450)

0

0

Other income/(expense)

 

 

(406)

(253)

(831)

(2,101)

(384)

(239)

(81)

(81)

Exceptionals and adjustments

 

(424)

2,220

214

(2,258)

(153)

0

0

0

Depreciation and amortisation

 

 

(1,215)

(1,960)

(2,300)

(2,323)

(2,466)

(2,690)

(3,285)

(3,503)

Reported EBIT

 

 

945

3,994

3,451

1,382

2,599

2,776

2,733

2,139

Finance income/(expense)

 

 

(207)

(301)

(308)

(274)

(225)

(160)

(158)

(23)

Reported PBT

 

 

738

3,693

3,143

1,108

2,374

2,615

2,575

2,117

Income tax expense (includes exceptionals)

 

 

(419)

(737)

(515)

(932)

(658)

(920)

(877)

(794)

Reported net income

 

 

380

2,884

2,791

233

1,733

1,696

1,698

1,322

Basic average number of shares, m

 

 

533

735

804

799

793

793

793

793

Basic EPS (US$)

 

 

0.64

3.82

3.52

1.46

2.11

2.09

2.06

1.60

Dividend per share (US$)*

 

 

0.56

0.56

1.45

2.20

2.20

2.20

1.60

1.60

Adjusted EBITDA

 

 

2,584

3,734

5,537

5,963

5,218

5,466

6,018

5,642

Adjusted EBIT

 

 

1,369

1,774

3,237

3,640

2,752

2,776

2,733

2,139

Adjusted PBT

 

 

1,162

1,473

2,929

3,366

2,527

2,615

2,575

2,117

Adjusted EPS (US$)

 

 

1.35

1.32

2.66

2.97

2.23

2.09

2.06

1.60

Adjusted diluted EPS (US$)

 

 

1.34

1.32

2.66

2.96

2.21

2.08

2.04

1.58

BALANCE SHEET

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment

 

 

12,258

25,276

24,281

24,124

23,863

23,573

22,488

20,485

Goodwill

 

 

58

2,674

2,771

2,771

2,771

2,771

2,771

2,771

Other non-current assets

 

 

3,122

5,752

5,812

5,973

5,973

5,973

5,973

5,973

Total non-current assets

 

 

15,438

33,702

32,864

32,868

32,607

32,317

31,232

29,229

Cash and equivalents

 

 

3,397

2,243

5,540

4,992

4,067

3,812

5,169

7,108

Inventories

 

 

630

1,014

963

930

1,120

1,125

1,138

1,104

Trade and other receivables

 

 

254

373

449

337

361

363

367

356

Other current assets

 

 

996

2,642

1,553

1,437

1,453

1,453

1,453

1,453

Total current assets

 

 

5,277

6,272

8,505

7,696

7,001

6,752

8,127

10,021

Non-current loans and borrowings

 

 

3,608

6,734

6,045

6,109

5,617

5,203

5,203

5,203

Other non-current liabilities

 

 

3,808

8,438

8,076

9,940

9,936

9,913

9,802

9,692

Total non-current liabilities

 

 

7,416

15,172

14,121

16,049

15,553

15,116

15,005

14,895

Trade and other payables

 

 

303

539

493

518

528

507

524

525

Current loans and borrowings

 

 

653

100

657

193

193

193

193

193

Other current liabilities

 

 

831

1,746

2,219

1,943

1,943

1,943

1,943

1,943

Total current liabilities

 

 

1,787

2,385

3,369

2,654

2,664

2,643

2,660

2,661

Equity attributable to company

 

 

10,502

21,420

23,008

22,022

21,948

21,864

22,227

22,224

Non-controlling interest

 

 

1,010

997

871

(161)

(555)

(553)

(534)

(530)

CASH FLOW STATEMENT

 

 

 

 

 

 

 

 

 

 

Profit for the year

 

 

380

2,884

2,791

233

1,733

1,696

1,698

1,322

Taxation expenses

 

 

386

832

704

1,098

773

1,072

1,002

869

Net finance expenses

 

 

207

301

308

274

225

160

158

23

Depreciation and amortisation

 

 

1,215

1,960

2,300

2,323

2,466

2,690

3,285

3,503

Share based payments

 

 

76

97

72

72

0

0

0

0

Other adjustments

 

 

749

(2,131)

(654)

2,277

172

169

81

81

Movements in working capital

 

 

(743)

(309)

295

(541)

(397)

(220)

(191)

(145)

Interest paid / received

 

 

(207)

(301)

(308)

(274)

(225)

(160)

(158)

(23)

Income taxes paid

 

 

(236)

(498)

(926)

(1,207)

(773)

(1,072)

(1,002)

(869)

Cash from operations (CFO)

 

 

1,827

2,866

4,882

4,279

3,974

4,335

4,873

4,761

Capex

 

 

(1,032)

(1,463)

(1,302)

(1,653)

(2,205)

(2,400)

(2,200)

(1,500)

Acquisitions & disposals net

 

 

(98)

224

1,463

(50)

(493)

0

0

0

Other investing activities

 

 

(47)

41

65

(15)

0

0

0

0

Cash used in investing activities (CFIA)

 

 

(1,177)

(1,226)

91

(1,868)

(2,698)

(2,400)

(2,200)

(1,500)

Net proceeds from issue of shares

 

 

(98)

(479)

(521)

(525)

0

0

0

0

Movements in debt

 

 

0

(1,186)

(175)

(390)

(492)

(414)

0

0

Dividends paid

 

 

(301)

(889)

(834)

(1,757)

(1,810)

(1,781)

(1,320)

(1,326)

Other financing activities

 

 

(56)

(223)

(150)

(286)

101

4

4

4

Cash from financing activities (CFF)

 

 

(455)

(2,777)

(1,680)

(2,958)

(2,200)

(2,191)

(1,316)

(1,322)

Currency translation differences and other

 

 

(4)

(3)

6

(8)

0

0

0

0

Increase/(decrease) in cash and equivalents

 

 

191

(1,140)

3,299

(555)

(925)

(255)

1,357

1,939

Cash and equivalents at end of period

 

 

3,489

2,349

5,648

5,093

4,168

3,913

5,270

7,209

Net (debt)/cash

 

 

(864)

(4,591)

(1,162)

(1,310)

(1,743)

(1,584)

(227)

1,712

Movement in net/(debt) cash over period

 

 

(864)

(3,727)

3,429

(148)

(433)

159

1,357

1,939

Source: company sources, Edison Investment Research. Note: *Excludes US$0.88/share special dividend in FY19.


General disclaimer and copyright

This report has been commissioned by Newmont Corporation and prepared and issued by Edison, in consideration of a fee payable by Newmont Corporation. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2022 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

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Frankfurt +49 (0)69 78 8076 960

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London +44 (0)20 3077 5700

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United Kingdom

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Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by Newmont Corporation and prepared and issued by Edison, in consideration of a fee payable by Newmont Corporation. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2022 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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