Newmont flags Omicron hit to output, Q4 profit drops more than a quarter
Newmont first-quarter production was hit by Covid-19, the world's top gold miner said on Thursday after posting a 27% drop in fourth-quarter adjusted profit due to a fall in bullion prices and pandemic-related expenses.
Spot gold prices declined last year from record levels hit earlier in the pandemic as rising vaccinations and the reopening of the global economy hit bullion's safe-haven appeal, while a hawkish US Federal Reserve also pressured prices.
Newmont, which lowered its 2021 output expectations and raised its forecast for production-related expenses in October, said current-quarter production could be impacted by as much as 150 000 oz due to Omicron.
Miners have also been grappling with production disruptions and labor shortages due to movement-related restrictions.
Denver, Colorado-based Newmont said its fourth-quarter average realized gold price dropped 3% to $1 798 an ounce from a year earlier, while attributable gold production fell marginally to 1.62-million ounces.
Gold prices, however, jumped as much as 3.48% on Thursday, as Russia's invasion of Ukraine ratcheted up fears of a war in Europe and drove investors toward safe havens.
The jump in bullion prices lifted shares in Newmont and rivals Barrick Gold and Yamana Gold between 1% and 2%.
Newmont said it incurred incremental pandemic-related costs of $21-million during the quarter and $87-million during 2021.
All-in sustaining cost, an industry metric that reflects total expenses associated with production, rose 1.2% to $1 056 per ounce of gold.
The company's quarterly adjusted profit of 78c a share edged past analysts' average estimate of 77c, according to Refinitiv IBES data.
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