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Newcrest's FY'19 profit surges 178% YOY; acquisition of Red Chris complete

Newcrest Mining Ltd. said Aug. 16 that its full fiscal 2019 net profit surged 178% to US$561 million, or 73 US cents per basic share, from US$202 million, or 26.3 cents per share, in the prior year.

Higher gold and copper sales volumes at the Cadia mine in New South Wales, Australia, a favorable Australian dollar exchange rate, as well as a lower depreciation expense at the Telfer mine in Western Australia, positively influenced earnings for the period.

Meanwhile, the gold- and copper-focused miner declared a fully franked dividend of 14.5 cents per share, taking its final dividend to 22.0 cents per share, to be paid out Sept. 26. Year-ago dividend totaled 18.5 cents per share.

Revenue for the year ended June 30 totaled US$3.74 billion, representing a 5% increase. EBITDA posted a 7% increase to US$1.67 billion.

Fiscal 2019 output totaled 2.5 million ounces of gold, up 6% and meeting full-year guidance of between 2.4 Moz and 2.6 Moz. Copper production jumped 36% to 105,867 tonnes.

Capital expenditure for its fiscal 2019 shrunk 2% to US$153 million. Net debt as of June 30 totaled US$395 million, a 62% reduction.

Newcrest forecast group production for its fiscal 2020 to remain in line with fiscal 2019. Gold production is forecast between 2.35 Moz and 2.50 Moz, with copper output between 110,000 tonnes and 120,000 tonnes.

Group capex has been set at between US$680 million and US$780 million, while exploration expenditure is targeted from US$90 million to US$100 million.

In a separate same day statement, Newcrest said it closed its acquisition of a 70% interest in the 23,142-hectare Red Chris copper-gold mine in British Columbia from Imperial Metals Corp.

The stake was purchased for US$804 million, against the earlier reported price of US$806.5 million. The final purchase price is subject to debt and net working capital adjustments.

Newcrest, which is assigned as the operator of the Red Chris joint venture with Imperial Metals, intends to undertake resource and exploration drilling, open pit and process plant optimization work as well as studies for selective processing and block cave mining design that will use data from the drilling programs.