Shares of Newmont Corporation (NYSE:NEM, TSX:NGT, ASX:NEM, ETR:NMM) rose 2.2% on Thursday morning after the world’s largest gold miner reported first-quarter earnings that beat Wall Street expectations, driven by higher gold prices, lower costs and delayed capital spending.
The company posted adjusted earnings per share of $1.25, ahead of its estimate of $0.97 and well above the consensus of $0.92. Adjusted EBITDA came in at $2.63 billion, beating Street forecasts.
Free cash flow was also a standout, reaching $1.21 billion versus estimates of $440 million, aided by lower general and administrative expenses, exploration costs and taxes, which are expected to be higher in the second quarter.
Production for the quarter was in line at 1.54 million ounces of gold, while all-in sustaining costs (AISC) came in at $1,651 per ounce, below the firm’s forecast of $1,731.
"Newmont delivered a strong Q1 no doubt, but there is an element of pulling forward some FCF from Q2," Jefferies analysts wrote in a note. "We expect higher production and lower costs in the back-half of the year."
The firm noted Newmont is on track to meet its full-year guidance, with a peak in both sustaining and development capex expected in the second quarter. About 52% of the company’s $1.875 billion sustaining capex budget for the year is expected to be spent in the first half.
Jefferies also pointed to the potential for increased shareholder returns. With roughly two-thirds of its $3 billion share buyback program already completed and $4.7 billion in cash from recent divestitures, the firm said Newmont is well-positioned to expand the program or use funds to reduce debt.
Newmont ended the quarter with $4.7 billion in cash and $750 million in debt.