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Higher gold price helps Newmont generate significant free cash flow in Q2

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(Kitco News) - Newmont Corporation (NYSE: NEM, TSX: NGT) , the world's biggest gold miner, said that higher gold prices helped generate significant free cash flow in the second quarter.

Thursday morning, ahead of the North American equity open, Newmont said that its net earnings for the second quarter were $412 million or $0.51 per diluted share, an increase of $411 million from the second quarter of 2019.

Adjusted net income was $261 million or $0.32 per diluted share, compared to $92 million or $0.12 per diluted share reported last year, the company added.

Newmont's earnings were relatively in line with analyst expectations.

"Revenue increased 5% from the prior-year quarter to $2,365 million primarily due to higher average realized gold prices, partially offset by lower gold sales volumes," the company said.

Because of the higher gold price, the Newmont generated $668 million of cash from continuing operations and $388 million of Free Cash Flow, the company said.

"In the second quarter, we delivered a solid financial performance with $984 million in adjusted EBITDA and $388 million in free cash flow, both substantial increases over the prior-year quarter. Our focus remains on ensuring the health, safety and wellbeing of our workforce and neighboring communities as we manage through the COVID pandemic," said Tom Palmer, president and chief executive officer in the press release.

Looking at production, Newmont said that it produced 1.3 million attributable ounces of gold in the second quarter, down about 21% compared to the second quarter of 2019. Meanwhile, the company also said that it produced 138,000 attributable gold equivalent ounces up 24% compared to last year.

The company said that it saw an average realized gold price of $1,724 an ounce in the second quarter, up 31% from 2019.

Looking at costs, the company said that all-in-sustaining costs increased 8% to $1,097 per ounce, compared to 2019.a

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