Newcrest Mining has reaffirmed its full-year gold production guidance after its biggest mine returned to full production helping to push up output.
The company has been hit by a series of incidents at its mines, which affected output in the previous two quarters. Even during the March quarter, production at its two Indonesian underground mines was affected following a `geotechnical’ incident in February.
Australia’s largest gold producer, however, bounced back to produce 636,521 ounces of gold in the three months to March 31, 2.55 per cent higher than the December quarter’s 620,691 tonnes.
“It was a quarter with a number of challenges. Although, it is pleasing to have increased our production and lowered our all-in sustaining cost per ounce,” managing director Sandeep Biswas said.
The increase was helped by a 58 per cent jump in production at its Cadia gold and copper mine in NSW, which operated at full capacity during the three-month period.
Cadia, which is also Newcrest’s highest-margin operation, had seen its production hit during the December quarter with a five-week shutdown of a major mill.
Resumption of operations helped the miner cut its all-in sustaining costs for the quarter by 4.5 per cent to $US723 per ounce. Newcrest also has slightly reduced its full-year cost guidance to $US1,875 million-$US1,975 million, from $US1,900 million-$US2,050 million.
Full-year capital expenditure guidance has also been cut to between $US440 million and $US540 million, from $US480 million -$575 million.
Production at its Telfer mine in Western Australia and Lihir mine in Papua New Guinea was slightly lower.
Output at Gosowong in Indonesia will continue to be affected by February’s geotechnical event, with production at the Kencana mine now not expected to resume before the end of June, it said.
Newcrest received a gold price of $US1,181 per ounce on average, up from $US1,100 in the prior quarter.
The company also announced a 30 per cent jump in copper production to 22,294 tonnes, mainly due to higher output at Cadia.
The miner in February posted a 55 per cent slide in first-half profit to $US81 million on the back of the shutdowns and lower gold and copper prices.
Newcrest Mining shares closed down 18 cents, or one per cent, at $17.72 each.