Newmont Corporation (NYSE:NEM) Q2 2023 Earnings Call Transcript

Tanya Jakusconek: Okay. Thank you for that. And then if I could just go back to Anita’s question on just the second half performance with some of the mines that I think Cerro Negro would be evenly distributed Ahafo and Mussel are going to get higher Q4. Is there any other operation that going to have a higher Q4 because when I look at the numbers, you’re looking at a production profile of Q4 being significantly stronger than Q3. Is that how I should think about it?

Tom Palmer: That’s right. Tanya, we’re building towards a strong fourth quarter you’ve got — you’ll have across some of the parts of the world in which we operate, you tend to get a bit more wet weather in the third quarter. So you typically see us have those drier locations that really bring it home in the fourth quarter. Pueblo Viejo ramping up with 40% of Pueblo Viejo. That’s an important part of H2, Nevada Gold Mines guiding to a strong second half. That’s an important part of our H2. Tanami, we have got pretty consistent tons through the mill in the second half, but we move into our highest grade stopes in the fourth quarter. So that’s an important story. And I think we probably covered the most of the Merian certainly got a stronger second pretty consistent across Q3 and Q4. So I think we’ve covered the sort of the key drivers of H1 versus H2 and where the higher fourth quarter would come from.

Tanya Jakusconek: Okay. No, I appreciate that. It’s just when you look at the production profile, excluding Peñasquito depending on what happens there, it is looking at the fourth quarter is the one that is going to carry quite a bit of weight for your — in order to get your guidance.

Tom Palmer: That’s right, Tanya. And were —

Tanya Jakusconek: If I could just do one final question.

Tom Palmer: Go ahead, Tanya.

Tanya Jakusconek: Sorry. Just

Tom Palmer: Go for it, Tanya.

Tanya Jakusconek: Okay. Sorry, I cut you to say something else. Just another follow-up on Greg’s questions on the inflationary release that you are seeing. I just wanted to confirm because some companies are not seeing exactly the same thing. Would be also fair to say that you are seeing cyanide pricing coming down relative to what you have? And I just kind of wonder in your agreement, do we restock your inventories on these lower level prices that are out there. Some contracts for some come up in three months, six months. I’m just wondering how — when we are expecting you to renegotiate at these lower levels, so we can see when those would go through your cost structure?

Tom Palmer: So, Tanya, we — our supply chain strategy, particularly with our key commodities is to have strategic contracts that are long-term based upon the size of our portfolio, and we built into those rise in full calculations. So, we pretty much then become a price taker, but at a competitive price. And, then we — and then we’ll have flowed through the — as you see prices go up and down, we have some relief in terms of the volatility about price increases or price decreases. And then with the inventories we have at sites, and it takes a little while for that to flow through. So, we are — on the back of natural gas prices coming off, we are seeing ammonia prices down, caustic soda prices are also down, and we are seeing improvement in both cyanide cost and explosive costs.

So, that is flowing through and it’s linked to — linked back to that key commodity price, and it’s flowing through our contracts. It will wash through our inventories and we just continue to, through those contracts, take the prices as we have agreed in those contracts, and that then takes normally a month or two or three to flow through our inventories.