Newmont (NEM - Free Report) saw its shares slip roughly 3% after it snipped its copper production outlook for 2013. The gold giant now sees copper production between 135 and 145 million pounds for the full year, down from 150 and 170 million pounds expected earlier. The Colorado-based company’s shares eventually closed at $25.62 in the trading session following the announcement, shedding around 2.6%.
The reduced copper production view is attributable to lower-than-expected mill throughput at the Boddington mine in in Australia and lower-than-expected ore grade at the Batu Hijau mine in Indonesia.
Newmont, however, backed its attributable gold production outlook for the full year, which is still expected in the band of 4.8 to 5.1 million ounces. The company noted that higher mill throughput in Nevada and the start of commercial production from the Akyem mine in Ghana in the fourth quarter will benefit gold production for the full year.
Newmont also reported preliminary attributable gold and copper production for third-quarter 2013 of 1.283 million ounces and 34 million pounds, respectively. Preliminary attributable gold and copper sales for the quarter were 1.263 million ounces and 35 million pounds, respectively.
Production in the quarter benefited from higher mill throughput in Nevada as well as increased grades and mining productivity resulting from efficiency improvements at the Tanami mine in Australia.
Newmont is planning to divest its Midas operation in Nevada, which it acquired through its merger with Normandy in 2002, to private equity investment firm Waterton Global Resource Management, Inc. The move reflects the company’s strategy to focus more on its core businesses.
Moreover, Newmont is reportedly planning to lay off 56 employees in Nevada amid increasing costs. The move represents a part of the company’s efforts to remain competitive in the current challenging business environment. The employees affected by the layoff will be granted severance packages and will also be provided access to services which will aid other job placement.
Newmont is also reportedly seeking acquisitions to add low-cost gold or copper output. Its CEO Gary Goldberg, at the Denver Gold Forum last month, said that the company will look for mines having longer life and lower costs. Moreover, the company is considering a joint venture with Barrick Gold (ABX - Free Report) in Nevada to explore means to cut costs.
Newmont, which currently retains a Zacks Rank #3 (Hold), will release its third quarter results after the closing gong on Oct 31.
Other gold miners worth considering include Lake Shore Gold Corp. and Gold Fields Ltd. (GFI - Free Report) with both holding a Zacks Rank #2 (Buy).