-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PN++xD0IW0K5j6bw81O9iKnLCSS1hBvtefDP+G5RFXTpXjxx2MxW9PBJPpECMxAh OOOqYeb7nGsJVxJFtMkigA== 0001275287-05-000715.txt : 20050224 0001275287-05-000715.hdr.sgml : 20050224 20050224132135 ACCESSION NUMBER: 0001275287-05-000715 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050224 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050224 DATE AS OF CHANGE: 20050224 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEWMONT MINING CORP /DE/ CENTRAL INDEX KEY: 0001164727 STANDARD INDUSTRIAL CLASSIFICATION: GOLD & SILVER ORES [1040] IRS NUMBER: 841611629 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-31240 FILM NUMBER: 05636710 BUSINESS ADDRESS: STREET 1: 1700 LINCOLN STREET CITY: DENVER STATE: CO ZIP: 80203 BUSINESS PHONE: 303-863-7414 MAIL ADDRESS: STREET 1: 1700 LINCOLN STREET CITY: DENVER STATE: CO ZIP: 80203 FORMER COMPANY: FORMER CONFORMED NAME: DELTA HOLDCO CORP DATE OF NAME CHANGE: 20020109 8-K 1 nm2129.txt ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): February 24, 2005 NEWMONT MINING CORPORATION ------------------------------------------------------ (Exact name of registrant as specified in its charter) DELAWARE ---------------------------------------------- (State or Other Jurisdiction of Incorporation) 001-31240 ------------------------ (Commission File Number) 84-1611629 ----------------------------------- (I.R.S. Employer Identification No. 1700 Lincoln Street, Denver, Colorado 80203 -------------------------------------------------- (Address of principal executive offices) (zip code) (303) 863-7414 ---------------------------------------------------- (Registrant's telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Not Applicable ------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) ================================================================================ ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On February 24, 2005, Newmont Mining Corporation, a Delaware corporation, issued a news release reporting its financial results for the fourth quarter and year ended December 31, 2004. A copy of the news release is furnished as Exhibit 99.1 to this report. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits EXHIBIT NUMBER DESCRIPTION OF EXHIBIT - -------------- ------------------------------------ 99.1 News Release dated February 24, 2005 2 SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. By: /s/ Thomas P. Mahoney ------------------------------ Name: Thomas P. Mahoney Title: Vice President and Treasurer Dated: February 24, 2005 3 EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION OF EXHIBIT - -------------- ---------------------- 99.1 News Release dated February 24, 2005 4 EX-99.1 2 nm2129ex991.txt Exhibit 99.1 NEWMONT ANNOUNCES FOURTH QUARTER NET INCOME OF $182 MILLION ($0.41 PER SHARE); 2004 NET INCOME OF $435 MILLION ($0.98 PER SHARE) DENVER, Feb. 24 /PRNewswire-FirstCall/ -- Newmont Mining Corporation (NYSE: NEM) today announced fourth quarter net income of $181.6 million ($0.41 per share) compared with net income of $153.1 million ($0.36 per share) for the fourth quarter of 2003. Newmont earned net income of $434.5 million ($0.98 per share) for 2004. Fourth quarter and 2004 highlights included: * Equity gold sales(1) for the fourth quarter of 1.8 million ounces at total cash costs(2) of $226 per ounce; equity gold sales for 2004 of 7.0 million ounces at total cash costs of $231 per ounce; * Net cash provided by operating activities for the fourth quarter of $587 million and 2004 net cash provided by operating activities of $1.6 billion; and * Cash and cash equivalents, marketable securities and investments exceeded debt by $490 million at year-end. Wayne W. Murdy, Chairman and Chief Executive Officer, said, "We ended the year with a strong fourth quarter, benefiting from rising gold prices. Our record $1.6 billion cash flow from operations in 2004 demonstrated the strength of our portfolio and our leverage to the gold price. We remain optimistic about gold prices given the current macro-economic and market fundamentals."
Fourth Quarter Year --------------------------- --------------------------- 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Financial (in millions, except per share) Revenues $ 1,230.0 $ 805.8 $ 4,524.2 $ 3,157.8 Net cash provided by operating activities $ 587.0 $ 203.9 $ 1,556.8 $ 684.4 Net income $ 181.6 $ 153.1 $ 434.5 $ 475.7 Net income per common share, basic $ 0.41 $ 0.36 $ 0.98 $ 1.16 Operating Equity gold sales (000 ounces)(1) 1,797.9 1,715.1 6,988.4 7,383.6 Average realized price ($/equity ounce) $ 436 $ 394 $ 412 $ 366 Total cash costs ($/equity ounce)(2) $ 226 $ 197 $ 231 $ 203 Total production costs ($/equity ounce)(2) $ 284 $ 259 $ 295 $ 266
1. Equity gold sales are those attributable to Newmont's ownership or economic interest. 2. For a reconciliation of total cash costs per ounce and total production costs per ounce (non-GAAP measures of performance) to costs applicable to sales calculated and presented under GAAP, please refer to the Supplemental Information attached. Financial & Operating Review Fourth quarter net income was $181.6 million ($0.41 per share), compared with $153.1 million ($0.36 per share) for the fourth quarter of 2003. For 2004, net income was $434.5 million ($0.98 per share), compared with net income of $475.7 million ($1.16 per share) for 2003. Net income for the fourth quarter of 2004 was impacted by the following items: * a $9 million ($0.02 per share) non-cash, after-tax write-down of long-lived assets; * a $52 million ($0.12 per share) non-cash, after-tax write-down of goodwill at Pajingo; * a $3 million ($0.01 per share) non-cash, after-tax net gain on the disposition of Perama and QMC; * a $62 million ($0.14 per share) net tax benefit resulting from the release of tax valuation allowances, tax true-ups and the filing of a consolidated tax return in Australia; and * a $16 million ($0.04 per share) non-cash, after-tax gain relating to FAS 143 reclamation estimate revisions. These items had the net effect of increasing net income for the fourth quarter of 2004 by $19 million ($0.04 per share). Net income for the fourth quarter of 2003 was impacted by the following items: * a $30 million ($0.07 per share) non-cash, after-tax loss on an inherited guarantee of QMC debt; * a $10 million ($0.02 per share) after-tax loss on the early extinguishment of debt; * an $18 million ($0.04 per share) non-cash, after-tax impairment charge at Golden Giant in Canada; and * a $72 million ($0.17 per share) tax benefit from the release of valuation allowances. These items had the net effect of increasing net income for the fourth quarter of 2003 by $14 million ($0.03 per share). For the fourth quarter of 2004, the Company sold 1,797,900 equity ounces of gold, 5% higher than the prior year quarter gold sales of 1,715,100 equity ounces. The average realized gold price for the fourth quarter was $436 per ounce, an 11% increase over the prior year quarter. For 2004, the Company sold 6,988,400 equity ounces of gold, 5% lower than 2003, largely as a result of increased stripping and lower grades in Nevada, the sale of non-core mines and the suspension of the Ovacik operations since August 2004. The average realized price for 2004 was $412 per ounce, a 13% increase over 2003. The Company generated net cash from operating activities of $587 million in the fourth quarter and $1.6 billion for 2004. Operating Highlights
Q4 Q4 North America 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Equity gold sales (000 ozs) 746.2 731.9 2,712.2 2,902.6 Total cash costs ($/ounce)(1) $ 267 $ 218 $ 278 $ 233
* Nevada operations sold 668,200 equity ounces in the fourth quarter (+7%) primarily due to increased tons milled and higher mill recoveries, offset by lower leach production and lower mill grades. Total cash costs of $265 per equity ounce (+20%) increased largely due to higher energy and maintenance costs. * Golden Giant in Canada sold 41,600 ounces in the fourth quarter (-39%) on lower ore grade (-34%) as the mine approaches closure. Total cash costs of $307 per ounce (+70%) increased due to lower production and the appreciation of the Canadian dollar. * Holloway in Canada sold 19,000 equity ounces in the fourth quarter (+27%) due to an increase in throughput (+3%) and an increase in ore grade (+9%). Total cash costs per equity ounce were $360 (+2%) as increased labor and electricity costs and the appreciation of the Canadian dollar more than offset the higher production. * La Herradura in Mexico sold 17,400 equity ounces in the fourth quarter (+3%) at total cash costs of $116 per equity ounce (-15%).
Q4 Q4 South America 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Equity gold sales (000 ozs) 440.9 351.9 1,582.7 1,626.4 Total cash costs ($/ounce)(1) $ 125 $ 128 $ 137 $ 126
* Yanacocha in Peru sold 436,000 equity ounces in the fourth quarter (+29%) from planned mining sequence changes that increased ore grades and inventory reduction resulting from the addition of three carbon columns in August 2004. Total cash costs of $124 per ounce (-2%) were favorably impacted by increased production, partially offset by higher diesel consumption and prices, increased consumption of reagents and higher royalties due to the increased gold price. * Kori Kollo in Bolivia sold 4,900 equity ounces in the fourth quarter (-65%) at total cash costs of $221 per equity ounce (+34%) as production continued from residual leaching.
Q4 Q4 Australia/New Zealand 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Equity gold sales (000 ozs) 477.0 477.4 1,906.9 2,011.5 Total cash costs ($/ounce)(1) $ 280 $ 224 $ 272 $ 234
* The Australian and New Zealand operations sold 477,000 equity ounces in the fourth quarter. Total cash costs of $280 per equity ounce increased 25% from the year ago quarter, largely due to lower grades at Pajingo, stronger Australian and New Zealand dollars and higher diesel and consumable costs. * Kalgoorlie sold 123,100 equity ounces (+29%) due to higher production (+11%) and a reduction in inventory. Total cash costs of $297 per equity ounce (+12%) increased due to lower grades and recoveries as well as increased diesel and consumable costs. * Pajingo sold 69,400 ounces (-3%) at total cash costs of $232 per ounce (+61%). Total cash costs increased primarily due to increased tons milled (+7%), lower ore grade (-27%) and increased mine maintenance costs. * Tanami sold 152,200 ounces (+9%) due to an increase in mill throughput (+6%). Total cash costs of $322 per ounce (+32%) were higher due to lower grades and additional underground backfill costs. * Yandal sold 88,300 ounces (-33%) in the fourth quarter. The decrease was largely due to the sale of the Wiluna and Bronzewing mines in December 2003 and 2004, respectively. Total cash costs increased 8%, largely from higher consumable costs. * Martha in New Zealand sold 40,200 ounces (+14%) at total cash costs of $201 per ounce (+41%) as higher grades were more than offset by higher slope stability costs and consumable costs. * Golden Grove sold 13.9 million pounds of copper (-51%) and 22.4 million pounds of zinc (-46%) due mainly to lower tons processed and the timing of shipments. Total cash costs per pound of copper ($1.01) and zinc ($0.35) increased 51% and 150%, respectively, primarily from higher ground support costs and lower production.
Q4 Q4 Indonesia-Batu Hijau 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Equity copper sales (M lbs) 86.9 79.1 378.8 343.4 Total cash costs ($/lb Cu)(1, 2) $ 0.65 $ 0.57 $ 0.60 $ 0.46 Equity gold sales (000 ozs) 94.6 66.2 396.3 328.9 Total cash costs ($/oz Au)(1, 2) $ 124 $ 131 $ 128 $ 121
* Effective January 1, 2004, the Company consolidated Batu Hijau and changed to co-product cost accounting for copper and gold, whereby specifically identifiable production costs are assigned for each product and any remaining costs are allocated in proportion to the sales revenue generated by each product. As a result, reported cash costs are impacted by relative movements in prices and production. * Effective October 1, 2004, Newmont's economic interest in Batu Hijau decreased to 52.875% from 56.25%, reflecting cumulative positive retained earnings at the end of the third quarter and the initiation of dividend payments to the minority partner. * Batu Hijau sold 86.9 million equity pounds of copper (+10%) and 94,600 equity ounces of gold (+43%) in the fourth quarter as a result of higher mill throughput (+12%) and higher ore grades (copper +5%, gold +28%), partially offset by lower recoveries. * Copper and gold total cash costs were $0.65 per pound and $124 per ounce, respectively, in the fourth quarter. Mining and processing costs were lower than the year ago quarter, but this was offset by increased treatment and refining charges and administrative costs.
Q4 Q4 Central Asia 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Equity gold sales (000 ozs) 39.2 76.7 320.1 386.3 Total cash costs ($/ounce)(1) $ 157 $ 144 $ 166 $ 139
* Zarafshan in Uzbekistan sold 39,200 equity ounces (-15%) as a result of lower ore grade (-11%). Total cash costs of $157 per equity ounce (+9%) were higher due to lower production. * The Ovacik operations were suspended in August 2004 as a result of a Turkish court decision and pending completion of additional permitting requirements. 1. For a reconciliation of total cash costs per ounce and per pound and total production costs per ounce and per pound (non-GAAP measures of performance) to costs applicable to sales calculated and presented under GAAP, please refer to the Supplemental Information attached. 2. 2003 total cash costs for Batu Hijau included pro forma results to reflect the change to co-product accounting effective January 1, 2004. Other Highlights Cash, Marketable Securities and Debt At the end of the fourth quarter, cash and cash equivalents totaled $1.6 billion, essentially offsetting outstanding debt of $1.6 billion. Of the outstanding debt, $706 million was Batu Hijau project finance debt that is non-recourse to Newmont. During the fourth quarter, outstanding debt decreased by a net $93 million. At the close of markets on December 31, the value of the Company's marketable securities and other investments portfolio was $0.5 billion. Newmont Capital Newmont Capital manages the Company's royalty and marketable securities portfolios as well as asset transactions. For the fourth quarter, royalty and dividend income increased to $18.2 million (+17%). For 2004, royalty and dividend income was $65.8 million compared with $56.3 million in 2003. The increases primarily reflected higher precious metals, oil and gas prices and distributions from the Canadian Oil Sands Trust investment made in 2004. During the fourth quarter, Newmont Capital entered into or closed the following transactions and agreements: * the restructuring of the Company's obligations at QMC in Australia; * the sale of the Perama property in Greece; * the sale of the Company's interest in the Midwest Uranium joint venture in Canada; and * a private placement in Stratagold to fund exploration initiatives in Canada and Guyana. In February 2005, Newmont Capital entered into an agreement for the sale of Ovacik to a subsidiary of Koza Davetieye, a Turkish conglomerate. The sale is expected to be completed by the end of the first quarter. Project Development The development of the Leeville underground project in Nevada remains on schedule with initial gold production expected in the fourth quarter of 2005. Ventilation shaft excavation work was completed during the fourth quarter. The production shaft is 88% complete to a depth of 1,610 feet. Development of ore access continues as does construction of support facilities underground. At Phoenix in Nevada, a ground-breaking ceremony in the fourth quarter was followed by the start of construction of the processing facilities. Engineering is approximately 75% complete with initial gold production expected in mid-2006. At the Ahafo project in Ghana, engineering work is approximately 80% complete. Construction is approximately 20% complete with camp and infrastructure construction progressing along with earth works preparation for the mill, the tailings facility and the water storage dam. The Afaho project remains on schedule for initial gold production in the second half of 2006. At Akyem in Ghana, the feasibility study update is nearing completion and a development decision is expected by mid-2005. At Boddington in Australia, completion of the feasibility study update is expected by mid-2005. Exploration Exploration, research and development expenditures were $192.4 million in 2004, compared with $115.2 million in 2003. Newmont drilled 2.8 million feet (542 miles) during the year, resulting in discoveries that added 8.6 million equity ounces to reserves, with an additional 3.8 million equity ounces added from the $25 higher gold price assumption of $350 per ounce. Drilling at Ahafo intersected higher grade mineralization at depth in the south area, which will be followed up in 2005 with further drilling to test for open pit extension as well as underground mining potential. At Akyem, further drilling in 2005 will test new targets in the area. In Nevada, a 275-hole drill program at Phoenix resulted in the addition of 2.3 million ounces of reserves, expanding the pit shells and increasing the mine life from 13 years to 17 years. At Gold Quarry, infill drilling converted non-reserve material to reserves and, coupled with design changes of the Gold Quarry pit, maintained reserves of 6 million ounces after depletion of more than 600,000 ounces in 2004. In Peru, the Company added 4.5 million equity ounces of reserves at Minas Conga. Further drilling and optimization efforts are continuing at Minas Conga in 2005. At Batu Hijau in Indonesia, gold reserves were replaced, while the higher $0.90 per pound copper price assumption contributed to copper reserve additions that nearly replaced depletion. Drilling in 2005 in Australia and in New Zealand will focus on potential new deposits and on expanding mineralized zones at Tanami's Callie underground mine, Jundee, Pajingo and Martha. 2005 Guidance For 2005, the Company expects gold sales of between 6.6 million and 6.8 million equity ounces at total cash costs of between $235 and $245 per ounce. Lower expected equity gold sales are largely attributable to the assumed sale of Ovacik in the first quarter of 2005. Increased cash costs are primarily due to lower ore grades processed and slightly lower than expected recovery rates, as well as assumed ongoing US dollar weakness and higher consumable costs. The Company expects that equity sales for the second half of the year will be between 10% and 15% higher than the first half due to mine plan sequencing. Guidance for exploration, research and development expenditures for 2005 is between $170 million and $200 million on a consolidated basis, reflecting continued optimization of feasibility studies at Minas Conga in Peru, and ongoing exploration and advanced study efforts at Ahafo and Akyem in Ghana, as well as Elang and Martabe in Indonesia. The Company expects consolidated capital expenditures for 2005 of between $1.0 billion and $1.3 billion, largely due to development investments in Ghana, Peru and Nevada. STATEMENTS OF CONSOLIDATED INCOME
Three Months Ended December 31, ---------------------------- 2004 2003 ------------ ------------ (unaudited, in thousands, except per share) Revenues Sales-gold, net $ 1,028,769 $ 773,405 Sales-base metals, net 201,273 32,441 1,230,042 805,846 Costs and expenses Costs applicable to sales (exclusive of depreciation, depletion and amortization shown separately below) Gold 488,947 378,268 Base metals 99,478 14,057 Depreciation, depletion and amortization 173,378 143,108 Exploration, research and development 53,416 32,499 General and administrative 35,899 43,636 Write-down of goodwill 51,750 -- Write-down of long-lived assets 13,400 29,884 Other (14,272) 17,073 901,996 658,525 Other income (expense) Gain on investments, net 176 1,773 Gain (loss) on derivative instruments, net 1,449 (1,866) Loss on extinguishment of debt -- (14,302) Royalty and dividend income 18,218 15,530 Interest income, foreign currency exchange and other income 32,990 16,752 Interest, net (20,201) (17,208) 32,632 679 Pre-tax income before minority interest and equity income of affiliates 360,678 148,000 Income tax (expense) benefit (74,644) 25,628 Minority interest in income of subsidiaries (104,945) (42,457) Equity income of affiliates 534 21,960 Net income $ 181,623 $ 153,131 Net income per common share, basic and diluted $ 0.41 $ 0.36 Basic weighted-average common shares outstanding 444,641 426,498 Diluted weighted-average common shares outstanding 448,012 430,944
STATEMENTS OF CONSOLIDATED INCOME
Year Ended December 31, ---------------------------- 2004 2003 ------------ ------------ (unaudited, in thousands, except per share) Revenues Sales -- gold, net $ 3,653,563 $ 3,082,936 Sales -- base metals, net 870,622 74,820 4,524,185 3,157,756 Costs and expenses Costs applicable to sales (exclusive of depreciation, depletion and amortization shown separately below) Gold 1,935,863 1,655,989 Base metals 367,367 44,273 Depreciation, depletion and amortization 696,522 564,481 Exploration, research and development 192,409 115,238 General and administrative 115,848 130,292 Write-down of goodwill 51,750 -- Write-down of long-lived assets 39,265 35,260 Other 34,433 49,506 3,433,457 2,595,039 Other income (expense) (Loss) gain on investments, net (39,019) 83,166 Gain on derivative instruments, net 2,356 22,876 Gain on extinguishment of NYOL liabilities, net -- 220,537 Loss on extinguishment of debt (222) (33,832) Royalty and dividend income 65,824 56,319 Interest income, foreign currency exchange and other income 76,948 102,182 Interest, net (97,610) (88,579) 8,277 362,669 Pre-tax income before minority interest, equity income and equity loss and impairment of affiliates and cumulative effect of a change in accounting principle 1,099,005 925,386 Income tax expense (284,682) (206,950) Minority interest in income of subsidiaries (335,299) (173,178) Equity loss and impairment of Australian Magnesium Corporation -- (119,485) Equity income of affiliates 2,641 84,427 Income before cumulative effect of a change in accounting principle 481,665 510,200 Cumulative effect of a change in accounting principle, net (47,138) (34,533) Net income $ 434,527 $ 475,667 Income before cumulative effect of a change in accounting principle per common share, basic $ 1.09 $ 1.24 Cumulative effect of a change in accounting principle per common share, basic (0.11) (0.08) Net income per common share, basic $ 0.98 $ 1.16 Basic weighted-average common shares outstanding 443,463 410,600 Diluted weighted-average common shares outstanding 446,511 413,723
CONSOLIDATED BALANCE SHEETS
At December 31, ---------------------------- 2004 2003 ------------ ------------ (unaudited, in thousands) ASSETS Cash and cash equivalents $ 1,567,181 $ 1,314,022 Marketable securities and other short-term investments 158,687 274,593 Trade receivables 79,516 20,055 Accounts receivable 130,961 70,631 Inventories 264,374 225,719 Stockpiles and ore on leach pads 231,626 248,625 Deferred stripping costs 44,545 60,086 Deferred income tax assets 173,588 45,034 Other current assets 70,671 100,280 Current assets 2,721,149 2,359,045 Property, plant and mine development, net 5,360,892 3,715,457 Investments 386,173 733,977 Deferred stripping costs 79,753 30,293 Long-term stockpiles and ore on leach pads 524,831 305,810 Deferred income tax assets 482,908 404,020 Other long-term assets 180,247 106,995 Goodwill 3,025,935 3,042,557 Total assets $ 12,761,888 $ 10,698,154 LIABILITIES Current portion of long-term debt $ 285,477 $ 190,866 Accounts payable 230,976 163,164 Employee-related benefits 134,524 136,301 Other current liabilities 450,028 352,202 Current liabilities 1,101,005 842,533 Long-term debt 1,311,260 886,633 Reclamation and remediation liabilities 431,500 362,283 Deferred revenue from sale of future production 46,841 53,841 Deferred income tax liabilities 476,134 272,603 Employee-related benefits 249,754 253,726 Advanced stripping costs 102,831 -- Other long-term liabilities 338,643 295,082 Total liabilities 4,057,968 2,966,701 Minority interest in subsidiaries 775,060 346,518 STOCKHOLDERS' EQUITY Total stockholders' equity 7,928,860 7,384,935 Total liabilities and stockholders' equity $ 12,761,888 $ 10,698,154
STATEMENTS OF CONSOLIDATED CASH FLOWS
Three Months Ended December 31, ---------------------------- 2004 2003 ------------ ------------ (unaudited, in thousands) Operating activities: Net income $ 181,623 $ 153,131 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion and amortization 173,378 143,108 Accretion of accumulated reclamation obligations 6,149 5,491 Amortization of deferred stripping costs, net (4,328) (6,784) Deferred income taxes (20,242) (51,274) Foreign currency exchange gain (14,228) (26,150) Minority interest expense 104,945 42,457 Equity income and impairment of affiliates, net of dividends (313) (21,227) Write-down of inventories, stockpiles and ore on leach pads 13,641 4,512 Write-down of goodwill 51,750 -- Write-down of long-lived assets 13,400 29,884 Loss (gain) on investments, net (176) (1,773) (Gain) loss on derivative instruments, net (1,449) 1,866 (Gain) loss on guarantee of QMC debt (10,616) 30,000 Loss on extinguishment of debt -- 14,302 Loss (gain) on asset sales, net 582 (12,495) Other operating adjustments (34,837) 1,494 (Increase) decrease in operating assets: Accounts receivable 90,323 1,079 Inventories, stockpiles and ore on leach pads (27,875) (53,704) Other assets 11,779 (7,955) Increase (decrease) in operating liabilities: Accounts payable and other accrued liabilities 68,227 (32,974) Early settlement of derivative instruments classified as cash flow hedges -- (185) Reclamation liabilities (14,706) (8,900) Net cash provided by operating activities 587,027 203,903 Investing activities: Additions to property, plant and mine development (198,051) (138,350) Investments in marketable equity securities (4,966) (6,405) Receipts from joint ventures and affiliates, net 1,002 23,110 Proceeds from sale of investments 1,978 -- Proceeds from sale of assets 28,655 3,997 Early settlement of ineffective derivative instruments -- 185 Investment in affiliates -- (13,848) Funding of QMC loan receivable (23,163) -- Other (8,884) (4,422) Net cash used in investing activities (203,429) (135,733) Financing activities: Proceeds from debt 18,206 363 Repayments of debt (112,623) (323,584) Dividends paid on common stock (44,574) (22,064) Dividends paid to minority interest (142,430) (65,677) Proceeds from stock issuance 44,153 1,231,903 Change in restricted cash and other (1,308) -- Net cash (used in) provided by financing activities (238,576) 820,941 Effect of exchange rate changes on cash gain 5,155 5,500 Net change in cash and cash equivalents 150,177 894,611 Cash and cash equivalents at beginning of period 1,417,004 419,411 Cash and cash equivalents at end of period $ 1,567,181 $ 1,314,022 Supplemental information: Income taxes paid, net of refunds $ 63,707 $ 49,140 Interest paid $ 28,864 $ 25,753
STATEMENTS OF CONSOLIDATED CASH FLOWS
Year Ended December 31, ---------------------------- 2004 2003 ------------ ------------ (unaudited, in thousands) Operating activities: Net income $ 434,527 $ 475,667 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion and amortization 696,522 564,481 Accretion of accumulated reclamation obligations 25,535 22,610 Amortization of deferred stripping costs, net 4,093 (36,497) Deferred income taxes 33,587 (36,183) Foreign currency exchange gain (9,213) (96,971) Minority interest expense 335,299 173,178 Equity loss (income) and impairment of affiliates, net of dividends (930) 42,467 Write-down of inventories, stockpiles and ore on leach pads 32,786 24,945 Write-down of long-lived assets 39,265 35,260 Write-down of goodwill 51,750 -- Cumulative effect of a change in accounting principle, net 47,138 34,533 Loss (gain) on investments, net 39,019 (83,166) Gain on derivative instruments, net (2,356) (22,876) Gain on extinguishment of NYOL liabilities, net -- (220,537) (Gain) loss on guarantee of QMC debt (10,616) 30,000 Loss on extinguishment of debt 222 33,832 Gain on asset sales, net (28,004) (15,394) Other operating adjustments (58,814) (9,079) (Increase) decrease in operating assets: Accounts receivable 68,990 5,859 Inventories, stockpiles and ore on leach pads (23,257) (72,828) Other assets (1,372) (5,052) Increase (decrease) in operating liabilities: Accounts payable and other accrued liabilities (69,722) (19,096) Early settlement of derivative instruments classified as cash flow hedges -- (118,776) Reclamation liabilities (47,697) (21,990) Net cash provided by operating activities 1,556,752 684,387 Investing activities: Additions to property, plant and mine development (717,961) (504,535) Investments in marketable equity securities (224,170) (6,405) Receipts from joint ventures and affiliates, net 1,002 39,321 Proceeds from sale of investments 4,830 412,190 Proceeds from sale of assets 51,200 5,610 Early settlement of ineffective derivative instruments 7,775 (57,556) Investment in affiliates -- (70,072) Cash recorded upon consolidation of Batu Hijau 82,203 -- Cash consideration for acquisitions -- (11,195) Funding of QMC loan receivable (23,163) -- Other (12,408) (4,422) Net cash used in investing activities (830,692) (197,064) Financing activities: Proceeds from debt 55,921 492,841 Repayments of debt (253,711) (1,162,167) Dividends paid on common stock (133,300) (70,759) Dividends paid to minority interest (236,917) (145,950) Proceeds from stock issuance 77,531 1,286,751 Change in restricted cash and other 15,260 -- Net cash (used in) provided by financing activities (475,216) 400,716 Effect of exchange rate changes on cash gain 2,315 24,300 Net change in cash and cash equivalents 253,159 912,339 Cash and cash equivalents at beginning of year 1,314,022 401,683 Cash and cash equivalents at end of year $ 1,567,181 $ 1,314,022 Supplemental information: Income taxes paid, net of refunds $ 278,400 $ 194,297 Interest paid $ 92,100 $ 123,166
OPERATING STATISTICS SUMMARY
North America South America --------------------------- --------------------------- Three Months Ended December 31, 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 256 $ 229 $ 125 $ 125 Capitalized mining and other 5 (15) (6) (3) Cash operating costs 261 214 119 122 Royalties and production taxes 6 4 6 6 Total cash costs (5) 267 218 125 128 Reclamation and mine closure costs 2 (7) 3 4 Total costs applicable to sales 269 211 128 132 Depreciation and amortization 49 65 60 60 Total production costs (5) $ 318 $ 276 $ 188 $ 192 Consolidated gold sales (000 ounces) 780.7 731.9 854.7 674.0 Equity gold sales (000 ounces) 746.2 731.9 440.9 351.9
OPERATING STATISTICS SUMMARY
Australia/New Zealand(1) Indonesia(2) --------------------------- --------------------------- Three Months Ended December 31, 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 276 $ 216 $ 144 $ 374 Capitalized mining and other (10) (10) (29) 3 Cash operating costs 266 206 115 377 Royalties and production taxes 14 18 9 6 Total cash costs (5) 280 224 124 383 Reclamation and mine closure costs 3 -- 1 12 Total costs applicable to sales 283 224 125 395 Depreciation and amortization 67 60 44 156 Total production costs (5) $ 350 $ 284 $ 169 $ 551 Consolidated gold sales (000 ounces) 477.0 477.4 178.9 11.7 Equity gold sales (000 ounces) 477.0 477.4 94.6 11.0
OPERATING STATISTICS SUMMARY
Central Asia(3) Equity Investments(4) --------------------------- --------------------------- Three Months Ended December 31, 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 154 $ 148 -- -- Capitalized mining and other 3 (11) -- -- Cash operating costs 157 137 -- -- Royalties and production taxes -- 7 -- -- Total cash costs (5) 157 144 -- -- Reclamation and mine closure costs 2 9 -- -- Total costs applicable to sales 159 153 -- -- Depreciation and amortization 55 60 -- -- Total production costs (5) $ 214 $ 213 -- -- Consolidated gold sales (000 ounces) 39.2 76.7 -- -- Equity gold sales (000 ounces) 39.2 76.7 -- 66.2
OPERATING STATISTICS SUMMARY
Total ---------------------------- Three Months Ended December 31, 2004 2003 ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 221 $ 199 Capitalized mining and other (4) (10) Cash operating costs 217 189 Royalties and production taxes 9 8 Total cash costs (5) 226 197 Reclamation and mine closure costs 2 (1) Total costs applicable to sales 228 196 Depreciation and amortization 56 63 Total production costs (5) $ 284 $ 259 Consolidated gold sales (000 ounces) 2,330.5 1,971.7 Equity gold sales (000 ounces) 1,797.9 1,715.1 Average realized price per equity ounce $ 436 $ 394 Copper Summary (6) Equity copper production (000 pounds) 104,258 92,909 Equity copper sales (000 pounds) 100,712 107,225 Total cash cost per equity pound $ 0.70 $ 0.67 Average realized price per equity pound $ 1.38 $ 0.96
(1) Includes 3,800 and 3,000 ounces from the wholly-owned Golden Grove zinc/copper mine in 2004 and 2003, respectively. Golden Grove is excluded from the cash cost per ounce calculations. (2) Indonesia includes Batu Hijau in 2004 and Minahasa in 2003. (3) Central Asia/Europe includes Zarafshan (Uzbekistan) and Ovacik (Turkey) (4) Equity investments comprise Batu Hijau, TVX Newmont Americas and Echo Bay Mines Limited. (5) For a reconciliation of total cash costs and total production costs per ounce (non-GAAP measures of performance) to costs applicable to sales calculated and presented under GAAP, please refer to the Supplemental Information attached. (6) Represents both Batu Hijau and Golden Grove except total cash cost and average realized price per equity pound for 2003 are only Golden Grove. OPERATING STATISTICS SUMMARY
North America South America --------------------------- --------------------------- Year Ended December 31, 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 293 $ 244 $ 137 $ 125 Capitalized mining and other (20) (17) (7) (4) Cash operating costs 273 227 130 121 Royalties and production taxes 5 6 7 5 Total cash costs (5) 278 233 137 126 Reclamation and mine closure costs 2 1 2 3 Total costs applicable to sales 280 234 139 129 Depreciation and amortization 56 61 70 60 Total production costs (5) $ 336 $ 295 $ 209 $ 189 Consolidated gold sales (000 ounces) 2,834.2 2,902.6 3,064.5 3,038.8 Equity gold sales (000 ounces) 2,712.2 2,902.6 1,582.7 1,626.4
OPERATING STATISTICS SUMMARY
Australia/New Zealand(1) Indonesia(2) --------------------------- --------------------------- Year Ended December 31, 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 259 $ 227 $ 131 $ 240 Capitalized mining and other (1) (7) 8 3 Cash operating costs 258 220 139 243 Royalties and production taxes 14 14 9 6 Total cash costs (5) 272 234 148 249 Reclamation and mine closure costs 3 1 1 5 Total costs applicable to sales 275 235 149 254 Depreciation and amortization 67 60 39 78 Total production costs (5) $ 342 $ 295 $ 188 $ 332 Consolidated gold sales (000 ounces) 1,906.9 2,030.1 789.9 98.1 Equity gold sales (000 ounces) 1,906.9 2,011.5 466.5 92.2
OPERATING STATISTICS SUMMARY
Central Asia(3) Equity Investments(4) --------------------------- --------------------------- Year Ended December 31, 2004 2003 2004 2003 ------------ ------------ ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 168 $ 137 -- -- Capitalized mining and other (6) (3) -- -- Cash operating costs 162 134 -- -- Royalties and production taxes 4 5 -- -- Total cash costs (5) 166 139 -- -- Reclamation and mine closure costs 2 3 -- -- Total costs applicable to sales 168 142 -- -- Depreciation and amortization 81 62 -- -- Total production costs (5) $ 249 $ 204 -- -- Consolidated gold sales (000 ounces) 320.1 386.3 -- -- Equity gold sales (000 ounces) 320.1 386.3 -- 364.6
OPERATING STATISTICS SUMMARY
Total ---------------------------- Year Ended December 31, 2004 2003 ------------ ------------ Production Costs Per Ounce: Direct mining and production costs $ 232 $ 205 Capitalized mining and other (9) (10) Cash operating costs 223 195 Royalties and production taxes 8 8 Total cash costs (5) 231 203 Reclamation and mine closure costs 2 2 Total costs applicable to sales 233 205 Depreciation and amortization 62 61 Total production costs (5) $ 295 $ 266 Consolidated gold sales (000 ounces) 8,915.6 8,455.9 Equity gold sales (000 ounces) 6,988.4 7,383.6 Average realized price per equity ounce $ 412 $ 366 Copper Summary (6) Equity copper production (000 pounds) 438,194 414,493 Equity copper sales (000 pounds) 422,268 417,681 Total cash cost per equity pound $ 0.63 $ 0.59 Average realized price per equity pound $ 1.33 $ 0.86
(1) Includes 19,300 and 13,400 ounces from the wholly-owned Golden Grove zinc/copper mine in 2004 and 2003, respectively. Golden Grove is excluded from the cash cost per ounce calculations. (2) Indonesia includes Batu Hijau and Minahasa in 2004 and Minahasa in 2003. (3) Central Asia/Europe includes Zarafshan (Uzbekistan) and Ovacik (Turkey) (4) Equity investments comprise Batu Hijau, TVX Newmont Americas and Echo Bay Mines Limited. (5) For a reconciliation of total cash costs and total production costs per ounce (non-GAAP measures of performance) to costs applicable to sales calculated and presented under GAAP, please refer to the Supplemental Information attached. (6) Represents both Batu Hijau and Golden Grove except total cash cost and average realized price per equity pound for 2003 are only Golden Grove. 2005 Guidance
Equity Gold Total Sales Cash Costs (000 oz) ($/oz) ------------ ------------ North America Nevada 2,570 $ 285 Golden Giant 160 $ 305 Holloway 85 $ 355 La Herradura 80 $ 150 Sub-total 2,895 $ 285 South America Yanacocha 1,500 $ 135 Kori Kollo 85 $ 150 Sub-total 1,585 $ 135 Australia(1)/New Zealand Kalgoorlie 440 $ 335 Pajingo 205 $ 250 Tanami 475 $ 295 Yandal 325 $ 300 Martha 140 $ 225 Sub-total 1,585 $ 295 Indonesia Batu Hijau 430 $ 145 Central Asia Zarafshan 150 $ 215 TOTAL (2) 6,600-6,800 $235-$245
Equity Copper & Total Zinc Sales Cash Costs (million lbs) ($/lb) ------------- ----------- Batu Hijau - Copper 330-360 $0.58-$0.64 Golden Grove - Copper 40-50 $1.00-$1.05 Golden Grove - Zinc 200-220 $0.30-$0.35
Consolidated Financial (in millions, except tax rate) Royalty and dividend income $55-$65 Depreciation, depletion & amortization $700-$730 Exploration, research and development $170-$200 - Exploration $140-$160 - Advanced projects $20-$25 - Research, development and other $10-$15 General and administrative $115-$125 Interest expense, net $90-$95 Tax rate (assuming $425/oz gold) 25%-30% Capital expenditures $1,200-$1,325
Notes: 1. Total cash costs are based on an A$1 = $0.75 exchange rate assumption. 2. Excludes Golden Grove by-product sales of approximately 55,000 ounces. Supplemental Information 1. Gold Production Summary -- Americas Nevada Canada (1) ------------------- ------------------- Three Months Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons): Open-Pit 48,308 44,990 n/a n/a Underground 452 477 261 265 Tons Milled/Processed (000): Oxide 1,436 1,119 265 285 Refractory 2,444 2,264 n/a n/a Leach 5,085 5,757 n/a n/a Average Ore Grade (oz/ ton): Oxide 0.113 0.126 0.231 0.319 Refractory 0.217 0.228 n/a n/a Leach 0.034 0.026 n/a n/a Average Mill Recovery Rate: Oxide 79.3% 77.3% 94.4% 95.6% Refractory 91.6% 90.5% n/a n/a Ounces Produced (000) 703.6 701.5 60.6 85.6 Equity Ounces Produced (000): Oxide 130.9 118.6 60.6 85.6 Refractory 453.5 473.3 n/a n/a Leach 84.7 109.6 n/a n/a Total 669.1 701.5 60.6 85.6 Equity Ounces Sold (000) 668.2 625.7 60.6 82.9 Production Costs Per Ounce: Direct mining and production costs $ 253 $ 235 $ 320 $ 209 Capitalized mining and other 6 (18) 1 -- Cash operating costs 259 217 321 209 Royalties and production taxes 6 4 2 3 Total cash costs 265 221 323 212 Reclamation and mine closure costs 2 (9) 2 3 Total costs applicable to sales 267 212 325 215 Depreciation and amortization 47 60 77 102 Total production costs $ 314 $ 272 $ 402 $ 317 Other (2) Yanacocha, Peru ------------------- ------------------- Three Months Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons): Open-Pit 3,049 2,778 45,112 50,173 Underground n/a n/a n/a n/a Tons Milled/Processed (000): Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Leach 1,038 968 31,435 31,958 Average Ore Grade (oz/ ton): Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Leach 0.025 0.026 0.029 0.024 Average Mill Recovery Rate: Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Ounces Produced (000) 17.4 22.3 847.3 667.2 Equity Ounces Produced (000): Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Leach 17.4 22.3 435.1 342.7 Total 17.4 22.3 435.1 342.7 Equity Ounces Sold (000) 17.4 23.3 436.0 337.9 Production Costs Per Ounce: Direct mining and production costs $ 139 $ 170 $ 124 $ 123 Capitalized mining and other (23) (3) (6) (3) Cash operating costs 116 167 118 120 Royalties and production taxes -- 4 6 6 Total cash costs 116 171 124 126 Reclamation and mine closure costs 2 2 2 4 Total costs applicable to sales 118 173 126 130 Depreciation and amortization 64 48 60 59 Total production costs $ 182 $ 221 $ 186 $ 189 Kori Kollo, Bolivia ------------------- Three Months Ended December 31, 2004 2003 - --------------------------------- -------- -------- Tons Mined (000 dry short tons): Open-Pit n/a -- Underground n/a n/a Tons Milled/Processed (000): Oxide n/a n/a Refractory n/a 159 Leach n/a -- Average Ore Grade (oz/ ton): Oxide n/a n/a Refractory n/a 0.026 Leach n/a -- Average Mill Recovery Rate: Oxide n/a n/a Refractory n/a 39.2% Ounces Produced (000) 5.7 14.8 Equity Ounces Produced (000): Oxide n/a n/a Refractory n/a 4.8 Leach 5.0 8.1 Total 5.0 12.9 Equity Ounces Sold (000) 4.9 14.0 Production Costs Per Ounce: Direct mining and production costs $ 226 $ 179 Capitalized mining and other (23) (14) Cash operating costs 203 165 Royalties and production taxes 18 -- Total cash costs 221 165 Reclamation and mine closure costs 48 21 Total costs applicable to sales 269 186 Depreciation and amortization 59 74 Total production costs $ 328 $ 260 (1) Includes Golden Giant and Holloway (2) Other includes La Herradura and for 2003, La Herradura and Mesquite Nevada Canada (1) ------------------- ------------------- Year Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons): Open-Pit 192,821 176,254 n/a n/a Underground 1,574 1,733 1,001 1,191 Tons Milled/Processed (000): Oxide 4,626 2,914 1,004 1,228 Refractory 8,985 9,129 n/a n/a Leach 19,297 18,376 n/a n/a Average Ore Grade (oz/ ton): Oxide 0.125 0.140 0.232 0.260 Refractory 0.199 0.219 n/a n/a Leach 0.027 0.028 n/a n/a Average Mill Recovery Rate: Oxide 79.1% 80.8% 94.3% 95.3% Refractory 90.8% 90.6% n/a n/a Ounces Produced (000) 2,460.4 2,560.7 224.7 297.8 Equity Ounces Produced (000): Oxide 461.2 336.0 224.7 297.8 Refractory 1,544.8 1,834.2 n/a n/a Leach 332.5 390.5 n/a n/a Total 2,338.5 2,560.7 224.7 297.8 Equity Ounces Sold (000) 2,416.0 2,490.8 227.4 294.8 Production Costs Per Ounce: Direct mining and production costs $ 295 $ 248 $ 314 $ 241 Capitalized mining and other (22) (20) 2 2 Cash operating costs 273 228 316 243 Royalties and production taxes 5 7 2 3 Total cash costs 278 235 318 246 Reclamation and mine closure costs 3 -- 1 6 Total costs applicable to sales 281 235 319 252 Depreciation and amortization 52 57 81 93 Total production costs $ 333 $ 292 $ 400 $ 345 Other (2) Yanacocha, Peru ------------------- ------------------- Year Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons): Open-Pit 11,557 11,696 193,407 204,889 Underground n/a n/a n/a n/a Tons Milled/Processed (000): Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Leach 4,149 4,035 133,514 145,275 Average Ore Grade (oz/ ton): Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Leach 0.026 0.026 0.025 0.027 Average Mill Recovery Rate: Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Ounces Produced (000) 68.8 116.0 3,017.3 2,851.1 Equity Ounces Produced (000): Oxide n/a n/a n/a n/a Refractory n/a n/a n/a n/a Leach 68.8 116.0 1,549.4 1,464.1 Total 68.8 116.0 1,549.4 1,464.1 Equity Ounces Sold (000) 68.8 117.0 1,561.0 1,467.9 Production Costs Per Ounce: Direct mining and production costs $ 153 $ 169 $ 135 $ 118 Capitalized mining and other (7) (4) (6) (4) Cash operating costs 146 165 129 114 Royalties and production taxes -- 6 6 6 Total cash costs 146 171 135 120 Reclamation and mine closure costs 1 3 2 2 Total costs applicable to sales 147 174 137 122 Depreciation and amortization 73 62 70 62 Total production costs $ 220 $ 236 $ 207 $ 184 Kori Kollo, Bolivia ------------------- Year Ended December 31, 2004 2003 - --------------------------------- -------- -------- Tons Mined (000 dry short tons): Open-Pit n/a 7,638 Underground n/a n/a Tons Milled/Processed (000): Oxide n/a n/a Refractory n/a 5,559 Leach n/a 3,696 Average Ore Grade (oz/ ton): Oxide n/a n/a Refractory n/a 0.036 Leach n/a 0.017 Average Mill Recovery Rate: Oxide n/a n/a Refractory n/a 61.7% Ounces Produced (000) 25.2 176.2 Equity Ounces Produced (000): Oxide n/a n/a Refractory n/a 112.9 Leach 22.2 42.1 Total 22.2 155.0 Equity Ounces Sold (000) 21.7 158.5 Production Costs Per Ounce: Direct mining and production costs $ 257 $ 197 Capitalized mining and other (13) (13) Cash operating costs 244 184 Royalties and production taxes 16 -- Total cash costs 260 184 Reclamation and mine closure costs 43 13 Total costs applicable to sales 303 197 Depreciation and amortization 94 38 Total production costs $ 397 $ 235 (1) Includes Golden Giant and Holloway (2) Other includes La Herradura and for 2003, La Herradura and Mesquite 2. Gold Production Summary -- Australia/New Zealand Pajingo Yandal (1) ------------------- ------------------- Three Months Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) 181 185 662 1,765 Tons Milled/Processed (000) 208 194 624 1,226 Average Ore Grade (oz/ton) 0.343 0.472 0.155 0.143 Average Mill Recovery Rate 96.3% 96.8% 93.4% 92.5% Ounces Produced (000) 69.5 82.2 88.5 157.2 Equity Ounces Produced (000) 69.5 82.2 88.5 157.2 Equity Ounces Sold (000) 69.4 71.6 88.3 132.6 Production Costs Per Ounce: Direct mining and production costs $ 225 $ 132 $ 249 $ 238 Capitalized mining and other (6) (4) (1) (10) Cash operating costs 219 128 248 228 Royalties and production taxes 13 16 11 12 Total cash costs 232 144 259 240 Reclamation and mine closure costs 1 (1) 3 (1) Total costs applicable to sales 233 143 262 239 Depreciation and amortization 136 119 59 42 Total production costs $ 369 $ 262 $ 321 $ 281 Tanami Kalgoorlie ------------------- ------------------- Three Months Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) 492 4,466 11,431 13,061 Tons Milled/Processed (000) 1,157 1,087 1,870 1,844 Average Ore Grade (oz/ton) 0.142 0.157 0.069 0.071 Average Mill Recovery Rate 95.6% 95.6% 85.7% 87.8% Ounces Produced (000) 156.3 161.9 124.2 112.0 Equity Ounces Produced (000) 156.3 161.9 124.2 112.0 Equity Ounces Sold (000) 152.2 139.3 123.1 95.5 Production Costs Per Ounce: Direct mining and production costs $ 301 $ 214 $ 295 $ 258 Capitalized mining and other (1) (4) (9) (5) Cash operating costs 300 210 286 253 Royalties and production taxes 22 34 11 12 Total cash costs 322 244 297 265 Reclamation and mine closure costs 2 -- 3 (4) Total costs applicable to sales 324 244 300 261 Depreciation and amortization 58 61 36 30 Total production costs $ 382 $ 305 $ 336 $ 291 Martha ----------------- Three Months Ended December 31, 2004 2003 - --------------------------------- -------- ------ Tons Mined (000 dry short tons) 518 1,431 Tons Milled/Processed (000) 349 367 Average Ore Grade (oz/ton) 0.121 0.106 Average Mill Recovery Rate 91.0% 91.1% Ounces Produced (000) 39.3 35.7 Equity Ounces Produced (000) 39.3 35.7 Equity Ounces Sold (000) 40.2 35.4 Production Costs Per Ounce: Direct mining and production costs $ 270 $ 197 Capitalized mining and other (69) (54) Cash operating costs 201 143 Royalties and production taxes -- -- Total cash costs 201 143 Reclamation and mine closure costs 2 2 Total costs applicable to sales 203 145 Depreciation and amortization 93 93 Total production costs $ 296 $ 238 (1) 2004 includes Jundee. 2003 includes Jundee, Bronzewing and Wiluna. Pajingo Yandal (1) ------------------- ------------------- Year Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) 652 761 6,982 4,496 Tons Milled/Processed (000) 809 792 2,821 5,236 Average Ore Grade (oz/ton) 0.300 0.450 0.133 0.123 Average Mill Recovery Rate 96.5% 96.8% 92.9% 91.0% Ounces Produced (000) 241.1 340.5 354.7 590.8 Equity Ounces Produced (000) 241.1 340.5 354.7 590.8 Equity Ounces Sold (000) 251.4 330.3 379.3 565.6 Production Costs Per Ounce: Direct mining and production costs $ 226 $ 124 $ 266 $ 261 Capitalized mining and other (7) (6) (1) 2 Cash operating costs 219 118 265 263 Royalties and production taxes 11 11 9 10 Total cash costs 230 129 274 273 Reclamation and mine closure costs 1 -- 5 2 Total costs applicable to sales 231 129 279 275 Depreciation and amortization 125 88 70 64 Total production costs $ 356 $ 217 $ 349 $ 339 Tanami Kalgoorlie ------------------- ------------------- Year Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) 11,654 20,395 45,459 49,290 Tons Milled/Processed (000) 4,525 4,533 7,142 7,171 Average Ore Grade (oz/ton) 0.149 0.145 0.072 0.071 Average Mill Recovery Rate 95.3% 96.0% 86.7% 85.9% Ounces Produced (000) 640.0 629.6 453.2 421.2 Equity Ounces Produced (000) 640.0 610.4 453.2 421.2 Equity Ounces Sold (000) 658.0 588.6 468.4 404.7 Production Costs Per Ounce: Direct mining and production costs $ 246 $ 222 $ 280 $ 256 Capitalized mining and other 11 (6) 7 (3) Cash operating costs 257 216 287 253 Royalties and production taxes 24 24 10 10 Total cash costs 281 240 297 263 Reclamation and mine closure costs 1 1 4 2 Total costs applicable to sales 282 241 301 265 Depreciation and amortization 58 59 35 24 Total production costs $ 340 $ 300 $ 336 $ 289 Martha ------------------- Year Ended December 31, 2004 2003 - --------------------------------- -------- -------- Tons Mined (000 dry short tons) 4,142 5,270 Tons Milled/Processed (000) 1,405 1,357 Average Ore Grade (oz/ton) 0.102 0.088 Average Mill Recovery Rate 90.4% 91.6% Ounces Produced (000) 129.7 110.2 Equity Ounces Produced (000) 129.7 108.5 Equity Ounces Sold (000) 130.5 108.9 Production Costs Per Ounce: Direct mining and production costs $ 292 $ 288 Capitalized mining and other (80) (89) Cash operating costs 212 199 Royalties and production taxes -- -- Total cash costs 212 199 Reclamation and mine closure costs 3 2 Total costs applicable to sales 215 201 Depreciation and amortization 105 105 Total production costs $ 320 $ 306 (1) 2004 includes Jundee for the full year and Bronzewing for the first quarter. 2003 includes Jundee, Bronzewing and Wiluna. 3. Gold Production Summary -- Indonesia and Central Asia Batu Hijau, Minahasa, Indonesia Indonesia ------------------- ------------------- Three Months Ended December 31, 2004 2003(1) 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) 63,548 56,798 n/a n/a Tons Milled/Processed (000): Leach n/a n/a n/a n/a Mill 14,424 12,868 -- 153 Average Ore Grade (oz/ton) 0.014 0.011 -- 0.150 Average Mill Recovery Rate 80.6% 81.6% -- 90.3% Ounces Produced (000) 172.7 120.1 -- 20.9 Equity Ounces Produced (000) 91.3 67.5 -- 19.6 Equity Ounces Sold (000) 94.6 66.2 -- 11.0 Production Costs Per Ounce: Direct mining and production costs $ 144 $ 162 -- $ 374 Capitalized mining and other (29) (48) -- 3 Cash operating costs 115 114 -- 377 Royalties and production taxes 9 17 -- 6 Total cash costs 124 131 -- 383 Reclamation and mine closure costs 1 3 -- 12 Total costs applicable to sales 125 134 -- 395 Depreciation and amortization 44 58 -- 156 Total production costs $ 169 $ 192 -- $ 551 Zarafshan, Ovacik, Uzbekistan Turkey ------------------- ------------------- Three Months Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) n/a n/a -- 1,914 Tons Milled/Processed (000): Leach 1,965 1,964 n/a n/a Mill n/a n/a -- 98 Average Ore Grade (oz/ton) 0.037 0.042 -- 0.376 Average Mill Recovery Rate n/a n/a -- 97.0% Ounces Produced (000) 38.9 48.6 -- 36.5 Equity Ounces Produced (000) 38.9 48.6 -- 36.5 Equity Ounces Sold (000) 39.2 46.2 -- 30.5 Production Costs Per Ounce: Direct mining and production costs $ 154 $ 140 -- $ 158 Capitalized mining and other 3 4 -- (30) Cash operating costs 157 144 -- 128 Royalties and production taxes -- -- -- 16 Total cash costs 157 144 -- 144 Reclamation and mine closure costs 2 10 -- 6 Total costs applicable to sales 159 154 -- 150 Depreciation and amortization 55 47 -- 81 Total production costs $ 214 $ 201 -- $ 231 (1) 2003 cash and total cost per ounce have been presented on a pro forma co-product basis for comparability to 2004. Batu Hijau, Minahasa, Indonesia Indonesia ------------------- ------------------- Year Ended December 31, 2004 2003(1) 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) 235,455 231,073 n/a n/a Tons Milled/Processed (000): Leach n/a n/a n/a n/a Mill 54,243 49,819 441 697 Average Ore Grade (oz/ton) 0.016 0.015 0.158 0.156 Average Mill Recovery Rate 80.9% 80.9% 90.5% 91.0% Ounces Produced (000) 718.8 600.8 63.8 99.3 Equity Ounces Produced (000) 398.5 337.9 59.9 93.3 Equity Ounces Sold (000) 396.3 328.9 70.2 92.2 Production Costs Per Ounce: Direct mining and production costs $ 110 $ 140 $ 248 $ 240 Capitalized mining and other 9 (36) 3 3 Cash operating costs 119 104 251 243 Royalties and production taxes 9 17 8 6 Total cash costs 128 121 259 249 Reclamation and mine closure costs 1 4 4 5 Total costs applicable to sales 129 125 263 254 Depreciation and amortization 40 54 32 78 Total production costs $ 169 $ 179 $ 295 $ 332 Zarafshan, Ovacik, Uzbekistan Turkey ------------------- ------------------- Year Ended December 31, 2004 2003 2004 2003 - --------------------------------- -------- -------- -------- -------- Tons Mined (000 dry short tons) n/a n/a 4,659 5,975 Tons Milled/Processed (000): Leach 7,894 8,080 n/a n/a Mill n/a n/a 331 533 Average Ore Grade (oz/ton) 0.042 0.043 0.320 0.343 Average Mill Recovery Rate n/a n/a 95.4% 94.3% Ounces Produced (000) 205.0 218.7 104.8 172.6 Equity Ounces Produced (000) 205.0 218.7 104.8 172.6 Equity Ounces Sold (000) 210.1 218.1 110.0 168.2 Production Costs Per Ounce: Direct mining and production costs $ 150 $ 145 $ 202 $ 127 Capitalized mining and other 2 2 (23) (11) Cash operating costs 152 147 179 116 Royalties and production taxes -- -- 14 13 Total cash costs 152 147 193 129 Reclamation and mine closure costs 2 4 2 2 Total costs applicable to sales 154 151 195 131 Depreciation and amortization 49 46 143 82 Total production costs $ 203 $ 197 $ 338 $ 213 (1) 2003 cash and total cost per ounce have been presented on a pro forma co-product basis for comparability to 2004. 4. Base Metal Summary -- Batu Hijau and Golden Grove Three Months Ended Year Ended December 31, December 31, --------------------- --------------------- Batu Hijau 2004 (1) 2003 (1) 2004 (1) 2003 (1) - ------------------------- --------- --------- --------- --------- Total tons mined (000) 63,548 56,798 235,455 231,073 Dry tons processed (000) 14,424 12,868 54,243 49,819 Average copper grade 0.67% 0.64% 0.75% 0.72% Average recovery rate 84.7% 86.6% 87.8% 88.6% Copper produced (000 lbs) 170,919 145,955 716,939 634,123 Equity copper produced (000 lbs) 90,373 82,100 397,510 356,694 Equity copper sold (000 lbs) 86,850 79,089 378,801 343,378 Realized copper price per pound $ 1.39 $ 1.05 $ 1.33 $ 0.86 Total cash cost per equity pound $ 0.65 $ 0.57 $ 0.60 $ 0.46 Noncash cost per equity pound 0.15 0.17 0.14 0.14 Total production cost per equity pound $ 0.80 $ 0.74 $ 0.74 $ 0.60 (1) 2003 cash and total cost per pound have been presented pro forma on a co-product basis for comparability to 2004. Three Months Ended Year Ended December 31, December 31, ---------------------- ---------------------- Golden Grove 2004 2003 2004 2003 - ---------------------------- --------- --------- --------- --------- Total tons mined (000) 356 393 1,404 1,457 Dry tons processed (000) 338 362 1,366 1,406 Average copper grade 3.07% 3.66% 3.12% 4.56% Average copper recovery rate 90.5% 86.1% 88.1% 90.9% Copper produced (000 lbs) 13,885 10,809 40,684 57,799 Copper sold (000 lbs) 13,862 28,136 43,467 74,303 Realized copper price per pound $ 1.33 $ 0.96 $ 1.36 $ 0.86 Copper cash cost per pound $ 1.01 $ 0.67 $ 0.90 $ 0.59 Average zinc grade 14.36% 12.47% 10.45% 12.40% Average zinc recovery rate 88.3% 88.3% 88.8% 89.9% Zinc produced (000 lbs) 13,218 33,031 101,917 120,425 Zinc sold (000 lbs) 22,392 41,579 114,835 104,711 Realized zinc price per pound $ 0.48 $ 0.39 $ 0.48 $ 0.43 Zinc cash cost per pound $ 0.35 $ 0.14 $ 0.38 $ 0.19 Gold sold (000 ounces) 3.8 3.0 19.3 13.4 Silver sold (000 ounces) 235.8 309.8 1,093.4 1,475.6 5. Reconciliation of Costs Applicable to Sales to Total Cash Cost Per Ounce and Per Pound, and Total Production Costs Per Ounce and Per Pound (dollars in millions except per ounce amounts) The total cash costs and total production costs per ounce or pound are non-GAAP performance measures that are intended to provide investors with information about the cash generating capacities and profitability of Newmont's mining operations. Newmont's management uses these measures for the same purpose and for monitoring the performance of its mining operations. These measures differ from measures determined in accordance with GAAP and should not be considered in isolation or as a substitute for measures of performance or liquidity determined in accordance with GAAP. These measures were developed in conjunction with gold mining companies associated with the Gold Institute in an effort to provide a level of comparability; however, Newmont's measures may not be comparable to similarly-titled measures of other companies.
Total Three Months Ended Golden La North December 31, Nevada Giant Holloway Canada Herradura America ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 190.6 $ 12.8 $ 6.8 $ 19.6 $ 2.0 $ 212.2 Minority interest -- -- -- -- -- -- Accretion expense (1.4) (0.1) -- (0.1) -- (1.5) Write-down of inventories -- -- -- -- -- -- Purchased ore and other (11.9) -- -- -- -- (11.9) Total cash cost for per ounce calculations 177.3 12.7 6.8 19.5 2.0 198.8 Accretion expense and other 1.4 0.1 -- 0.1 -- 1.5 Depreciation, depletion and amortization 31.1 2.2 2.5 4.7 1.1 36.9 Minority interest and other -- -- -- -- -- -- Total production cost for per ounce calculations $ 209.8 $ 15.0 $ 9.3 $ 24.3 $ 3.1 $ 237.2 Equity ounces sold (000) 668.2 41.6 19.0 60.6 17.4 746.2 Equity cash cost per ounce sold $ 265 $ 307 $ 360 $ 323 $ 116 $ 267 Equity total production cost per ounce sold $ 314 $ 362 $ 491 $ 402 $ 182 $ 318
Three Months Ended December 31, Kori South 2004 Yanacocha Kollo America Pajingo Yandal Tanami ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 111.9 $ 1.5 $ 113.4 $ 16.3 $ 23.1 $ 53.5 Minority interest (57.3) (0.2) (57.5) -- -- -- Accretion expense (0.8) (0.2) (1.0) (0.1) (0.3) (0.3) Write-down of inventories -- -- -- (0.1) -- (4.2) Purchased ore and other 0.4 -- 0.4 -- -- -- Total cash cost for per ounce calculations 54.2 1.1 55.3 16.1 22.8 49.0 Accretion expense and other 0.8 0.2 1.0 0.1 0.3 0.3 Depreciation, depletion and amortization 46.8 0.3 47.1 9.5 5.2 8.8 Minority interest and other (20.7) -- (20.7) -- -- -- Total production cost for per ounce calculations $ 81.1 $ 1.6 $ 82.7 $ 25.7 $ 28.3 $ 58.1 Equity ounces sold (000) 436.0 4.9 440.9 69.4 88.3 152.2 Equity cash cost per ounce sold $ 124 $ 221 $ 125 $ 232 $ 259 $ 322 Equity total production cost per ounce sold $ 186 $ 328 $ 188 $ 369 $ 321 $ 382
Three Months Ended Australia/ December 31, New Batu 2004 Kalgoorlie Martha Zealand Hijau Minahasa Indonesia ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 37.0 $ 8.2 $ 138.1 $ 22.2 $ 0.1 $ 22.3 Minority interest -- -- -- (10.9) -- (10.9) Accretion expense (0.4) (0.1) (1.2) (0.1) -- (0.1) Write-down of inventories -- -- (4.3) -- -- -- Purchased ore and other -- -- -- 0.5 -- 0.5 Total cash cost for per ounce calculations 36.6 8.1 132.6 11.7 0.1 11.8 Accretion expense and other 0.4 0.1 1.2 0.1 -- 0.1 Depreciation, depletion and amortization 4.4 3.7 31.6 7.9 -- 7.9 Minority interest and other -- -- -- (3.7) -- (3.7) Total production cost for per ounce calculations $ 41.4 $ 11.9 $ 165.4 $ 16.0 0.1 $ 16.1 Equity ounces sold (000) 123.1 40.2 473.2 94.6 -- 94.6 Equity cash cost per ounce sold $ 297 $ 201 $ 280 $ 124 -- $ 124 Equity total production cost per ounce sold $ 336 $ 296 $ 350 $ 169 -- $ 169
Three Months Ended Central December 31, 2004 Zarafshan Ovacik Asia Total Gold ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 6.2 $ 0.1 $ 6.3 $ 492.3 Minority interest -- -- -- (68.4) Accretion expense (0.1) (0.1) (0.2) (4.0) Write-down of inventories -- -- -- (4.3) Purchased ore and other -- -- -- (11.0) Total cash cost for per ounce calculations 6.1 -- 6.1 404.6 Accretion expense and other 0.1 0.1 0.2 4.0 Depreciation, depletion and amortization 2.1 2.9 5.0 128.5 Minority interest and other -- (2.9) (2.9) (27.3) Total production cost for per ounce calculations $ 8.3 $ 0.1 $ 8.4 $ 509.8 Equity ounces sold (000) (1) 39.2 -- 39.2 1,794.1 Equity cash cost per ounce sold $ 157 -- $ 157 $ 226 Equity total production cost per ounce sold $ 214 -- $ 214 $ 284
(1) Excludes 3.8 ounces from Golden Grove.
Three Months Ended December 31, Golden La 2003 Nevada Giant Holloway Canada Mesquite Herradura ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 141.7 $ 12.4 $ 5.4 $ 17.8 $ 1.7 $ 2.3 Minority interest -- -- -- -- -- -- Accretion expense 4.9 (0.1) (0.1) (0.2) -- -- Write-down of inventories -- -- -- -- -- -- Purchased ore and other (21.1) -- -- -- -- -- Total cash cost for per ounce calculations 125.5 12.3 5.3 17.6 1.7 2.3 Accretion expense and other (4.9) 0.1 0.1 0.2 -- -- Depreciation, depletion and amortization 34.3 7.0 1.5 8.5 0.3 0.9 Minority interest and other -- -- -- -- -- -- Total production cost for per ounce calculations $ 154.9 $ 19.4 $ 6.9 $ 26.3 $ 2.0 $ 3.2 Equity ounces sold (000) 625.7 67.9 15.0 82.9 6.4 16.9 Equity cash cost per ounce sold $ 221 $ 181 $ 353 $ 212 $ 259 $ 137 Equity total production cost per ounce sold $ 272 $ 286 $ 460 $ 317 $ 306 $ 188
Three Months Ended December 31, North Kori South 2003 America Yanacocha Kollo America Pajingo Yandal ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 163.5 $ 88.2 $ 3.0 $ 91.2 $ 10.4 $ 31.9 Minority interest -- (44.8) (0.3) (45.1) -- -- Accretion expense 4.7 (0.9) (0.3) (1.2) -- 0.1 Write-down of inventories -- -- -- -- -- (0.3) Purchased ore and other (21.1) -- -- -- -- -- Total cash cost for per ounce calculations 147.1 42.5 2.4 44.9 10.4 31.7 Accretion expense and other (4.7) 0.9 0.3 1.2 (0.1) (0.1) Depreciation, depletion and amortization 44.0 36.0 1.2 37.2 8.5 5.6 Minority interest and other -- (15.8) (0.1) (15.9) -- -- Total production cost for per ounce calculations $ 186.4 $ 63.6 $ 3.8 $ 67.4 $ 18.8 $ 37.2 Equity ounces sold (000) 731.9 337.9 14.0 351.9 71.6 132.6 Equity cash cost per ounce sold $ 218 $ 126 $ 165 $ 128 $ 144 $ 240 Equity total production cost per ounce sold $ 276 $ 189 $ 260 $ 192 $ 262 $ 281
Three Months Ended Australia/ December 31, New 2003 Tanami Kalgoorlie Martha Zealand Minahasa Zarafshan - ------------------ ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 34.3 $ 25.0 $ 5.2 $ 106.8 $ 4.6 $ 7.2 Minority interest -- -- -- -- -- -- Accretion expense (0.4) 0.3 (0.1) (0.1) (0.1) (0.5) Write-down of inventories -- -- -- (0.3) -- -- Purchased ore and other -- -- -- -- (0.3) -- Total cash cost for per ounce calculations 33.9 25.3 5.1 106.4 4.2 6.7 Accretion expense and other 0.1 (0.3) 0.1 (0.3) 0.1 0.5 Depreciation, depletion and amortization 8.5 2.9 3.3 28.8 1.8 2.1 Minority interest and other -- -- -- -- (0.2) -- Total production cost for per ounce calculations $ 42.5 $ 27.9 $ 8.5 $ 134.9 $ 5.9 $ 9.3 Equity ounces sold (000) 139.3 95.5 35.4 474.4 11.0 46.2 Equity cash cost per ounce sold $ 244 $ 265 $ 143 $ 224 $ 383 $ 144 Equity total production cost per ounce sold $ 305 $ 291 $ 238 $ 284 $ 551 $ 201
Three Months Ended December 31, 2003 Ovacik Central Asia Total Gold ---------- ------------ ---------- Costs applicable to sales under GAAP $ 4.7 $ 11.9 $ 378.0 Minority interest -- -- (45.1) Accretion expense (0.2) (0.7) 2.6 Write-down of inventories (0.1) (0.1) (0.4) Purchased ore and other -- -- (21.4) Total cash cost for per ounce calculations 4.4 11.1 313.7 Accretion expense and other 0.1 0.6 (3.1) Depreciation, depletion and amortization 2.5 4.6 116.4 Minority interest and other -- -- (16.1) Total production cost for per ounce calculations $ 7.0 $ 16.3 $ 410.9 Equity ounces sold (000) (1) 30.5 76.7 1,645.9 Equity cash cost per ounce sold $ 144 $ 144 $ 197 Equity total production cost per ounce sold $ 231 $ 213 $ 259 (1) Excludes 66.2 ounces from equity investments and 3.0 ounces from Golden Grove.
Year Ended December 31, 2004 Golden La North Nevada Giant Holloway Canada Herradura America ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 716.3 $ 47.6 $ 24.7 $ 72.3 $ 10.1 $ 798.7 Minority interest -- -- -- -- -- -- Accretion expense (5.6) (0.3) (0.1) (0.4) (0.1) (6.1) Write-down of inventories -- -- -- -- -- -- Purchased ore and other (38.4) 0.2 0.1 0.3 -- (38.1) Total cash cost for per ounce calculations 672.3 47.5 24.7 72.2 10.0 754.5 Accretion expense and other 5.6 0.3 0.1 0.4 0.1 6.1 Depreciation, depletion and amortization 126.8 11.4 7.0 18.4 5.0 150.2 Minority interest and other -- -- -- -- -- -- Total production cost for per ounce calculations $ 804.7 $ 59.2 $ 31.8 $ 91.0 $ 15.1 $ 910.8 Equity ounces sold (000) 2,416.0 160.0 67.4 227.4 68.8 2,712.2 Equity cash cost per ounce sold $ 278 $ 297 $ 367 $ 318 $ 146 $ 278 Equity total production cost per ounce sold $ 333 $ 370 $ 473 $ 400 $ 220 $ 336
Year Ended December 31, Kori South 2004 Yanacocha Kollo America Pajingo Yandal Tanami ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 432.6 $ 9.8 $ 442.4 $ 59.4 $ 105.9 $ 194.2 Minority interest (218.8) (1.2) (220.0) -- -- -- Accretion expense (3.1) (0.9) (4.0) (0.3) (1.7) (1.2) Write-down of inventories -- (2.1) (2.1) (1.1) (0.2) (8.2) Purchased ore and other (0.1) -- (0.1) -- -- -- Total cash cost for per ounce calculations 210.6 5.6 216.2 58.0 104.0 184.8 Accretion expense and other 3.1 0.9 4.0 0.1 1.7 1.0 Depreciation, depletion and amortization 198.0 2.3 200.3 31.4 26.8 37.9 Minority interest and other (88.8) (0.3) (89.1) -- -- -- Total production cost for per ounce calculations $ 322.9 $ 8.5 $ 331.4 $ 89.5 $ 132.5 $ 223.7 Equity ounces sold (000) 1,561.0 21.7 1,582.7 251.4 379.3 658.0 Equity cash cost per ounce sold $ 135 $ 260 $ 137 $ 230 $ 274 $ 281 Equity total production cost per ounce sold $ 207 $ 397 $ 209 $ 356 $ 349 $ 340
Year Ended Australia/ December 31, New Batu 2004 Kalgoorlie Martha Zealand Hijau Minahasa Indonesia ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 140.9 $ 28.1 $ 528.5 $ 91.2 $ 19.8 $ 111.0 Minority interest -- -- -- (42.1) -- (42.1) Accretion expense (1.7) (0.4) (5.3) (0.5) (0.3) (0.8) Write-down of inventories -- -- (9.5) -- (0.2) (0.2) Purchased ore and other -- -- -- 2.1 (1.2) 0.9 Total cash cost for per ounce calculations 139.2 27.7 513.7 50.7 18.1 68.8 Accretion expense and other 1.7 0.4 4.9 0.5 0.3 0.8 Depreciation, depletion and amortization 16.2 13.8 126.1 28.2 2.4 30.6 Minority interest and other -- -- -- (12.6) (0.1) (12.7) Total production cost for per ounce calculations $ 157.1 $ 41.9 $ 644.7 $ 66.8 $ 20.7 $ 87.5 Equity ounces sold (000) 468.4 130.5 1,887.6 396.3 70.2 466.5 Equity cash cost per ounce sold $ 297 $ 212 $ 272 $ 128 $ 259 $ 148 Equity total production cost per ounce sold $ 336 $ 320 $ 342 $ 169 $ 295 $ 188
Year Ended Central December 31, 2004 Zarafshan Ovacik Asia Total Gold ------------ ------------ ------------ ------------ Costs applicable to sales under GAAP $ 32.4 $ 22.9 $ 55.3 $ 1,935.9 Minority interest -- -- -- (262.1) Accretion expense (0.3) (0.4) (0.7) (16.9) Write-down of inventories -- (1.3) (1.3) (13.1) Purchased ore and other (0.1) -- (0.1) (37.4) Total cash cost for per ounce calculations 32.0 21.2 53.2 1,606.4 Accretion expense and other 0.3 0.2 0.5 16.3 Depreciation, depletion and amortization 10.3 18.6 28.9 536.1 Minority interest and other -- (2.9) (2.9) (104.7) Total production cost for per ounce calculations $ 42.6 $ 37.1 $ 79.7 $ 2,054.1 Equity ounces sold (000) (1) 210.1 110.0 320.1 6,969.1 Equity cash cost per ounce sold $ 152 $ 193 $ 166 $ 231 Equity total production cost per ounce sold $ 203 $ 338 $ 249 $ 295
(1) Excludes 19.3 ounces from Golden Grove.
Year Ended December 31, Golden La 2003 Nevada Giant Holloway Canada Mesquite Herradura ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 597.8 $ 53.4 $ 20.8 $ 74.2 $ 9.3 $ 11.1 Minority interest -- -- -- -- -- -- Accretion expense 0.1 (1.3) (0.5) (1.8) (0.2) (0.1) Write-down of inventories (2.9) -- -- -- -- -- Purchased ore and other (32.1) -- -- -- -- -- Total cash cost for per ounce calculations 562.9 52.1 20.3 72.4 9.1 11.0 Accretion expense and other (0.1) 1.3 0.5 1.8 0.2 0.1 Depreciation, depletion and amortization 137.7 22.0 5.3 27.3 3.9 3.4 Minority interest and other -- -- -- -- -- -- Total production cost for per ounce calculations $ 700.5 $ 75.4 $ 26.1 $ 101.5 $ 13.2 $ 14.5 Equity ounces sold (000) 2,490.8 229.7 65.1 294.8 49.2 67.8 Equity cash cost per ounce sold $ 235 $ 227 $ 312 $ 246 $ 184 $ 162 Equity total production cost per ounce sold $ 292 $ 329 $ 402 $ 345 $ 267 $ 214
Year Ended December 31, North Kori South 2003 America Yanacocha Kollo America Pajingo Yandal ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 692.4 $ 362.5 $ 35.6 $ 398.1 $ 42.9 $ 158.7 Minority interest -- (183.5) (4.2) (187.7) -- -- Accretion expense (2.0) (3.4) (2.1) (5.5) (0.1) (1.5) Write-down of inventories (2.9) -- -- -- -- (3.0) Purchased ore and other (32.1) -- -- -- -- -- Total cash cost for per ounce calculations 655.4 175.6 29.3 204.9 42.8 154.2 Accretion expense and other 2.0 3.4 2.1 5.5 (0.3) 1.4 Depreciation, depletion and amortization 172.3 160.4 6.8 167.2 29.2 35.8 Minority interest and other -- (70.1) (0.8) (70.9) -- -- Total production cost for per ounce calculations $ 829.7 $ 269.3 $ 37.4 $ 306.7 $ 71.7 $ 191.4 Equity ounces sold (000) 2,902.6 1,467.9 158.5 1,626.4 330.3 565.6 Equity cash cost per ounce sold $ 233 $ 120 $ 184 $ 126 $ 129 $ 273 Equity total production cost per ounce sold $ 295 $ 184 $ 235 $ 189 $ 217 $ 339
Year Ended Australia/ December 31, New 2003 Tanami Kalgoorlie Martha Zealand Minahasa Zarafshan ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 148.9 $ 108.4 $ 24.9 $ 483.8 $ 26.3 $ 32.9 Minority interest (4.2) -- (0.3) (4.5) -- -- Accretion expense (1.2) (0.8) (0.4) (4.0) (0.5) (0.7) Write-down of inventories (2.0) (1.0) (2.6) (8.6) (1.3) -- Purchased ore and other -- -- -- -- (1.6) -- Total cash cost for per ounce calculations 141.5 106.6 21.6 466.7 22.9 32.2 Accretion expense and other 0.2 0.8 0.2 2.3 0.5 0.7 Depreciation, depletion and amortization 36.0 9.8 11.5 122.3 7.6 10.1 Minority interest and other (1.0) -- (0.1) (1.1) (0.5) -- Total production cost for per ounce calculations $ 176.7 $ 117.2 $ 33.2 $ 590.2 $ 30.5 $ 43.0 Equity ounces sold (000) 588.6 404.7 108.9 1,998.1 92.2 218.1 Equity cash cost per ounce sold $ 240 $ 263 $ 199 $ 234 $ 249 $ 147 Equity total production cost per ounce sold $ 300 $ 289 $ 306 $ 295 $ 332 $ 197
Year Ended Central December 31, 2003 Ovacik Asia Total Gold ---------- ---------- ---------- Costs applicable to sales under GAAP $ 22.3 $ 55.2 $ 1,655.8 Minority interest -- -- (192.2) Accretion expense (0.4) (1.1) (13.1) Write-down of inventories (0.1) (0.1) (12.9) Purchased ore and other -- -- (33.7) Total cash cost for per ounce calculations 21.8 54.0 1,403.9 Accretion expense and other 0.2 0.9 11.2 Depreciation, depletion and amortization 13.9 24.0 493.4 Minority interest and other -- -- (72.5) Total production cost for per ounce calculations $ 35.9 $ 78.9 $ 1,836.0 Equity ounces sold (000) (1) 168.2 386.3 7,005.6 Equity cash cost per ounce sold $ 129 $ 139 $ 203 Equity total production cost per ounce sold $ 213 $ 204 $ 266 (1) Excludes 364.6 ounces from equity investments in Batu Hijau, TVX Newmont Americas and Echo Bay Mines Limited and 13.4 ounces from Golden Grove. 6. Reconciliation of Costs Applicable to Sales to Total Cash Cost Per Ounce, and Total Production Cost Per Ounce (dollars in millions except per ounce amounts)
Three Months Ended Year Ended December 31, 2003 December 31, 2003 -------------------------------------- -------------------------------------- Batu Batu Hijau(1) Minahasa Indonesia Hijau(1) Minahasa Indonesia ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales under GAAP $ 14.5 $ 4.6 $ 19.1 $ 68.9 $ 26.3 $ 95.2 Minority interest (6.0) -- (6.0) (29.7) -- (29.7) Accretion expense (0.2) (0.1) (0.3) (1.2) (0.5) (1.7) Write-down of inventories -- -- -- -- (1.3) (1.3) Purchased ore and other 0.4 (0.3) 0.1 1.8 (1.6) 0.2 Total cash cost for per ounce calculations 8.7 4.2 12.9 39.8 22.9 62.7 Accretion expense and other 0.2 0.1 0.3 1.2 0.5 1.7 Depreciation, depletion and amortization 6.7 1.8 8.5 32.0 7.6 39.6 Minority interest and other (2.9) (0.2) (3.1) (14.0) (0.5) (14.5) Total production cost for per ounce calculations $ 12.7 $ 5.9 $ 18.6 $ 59.0 $ 30.5 $ 89.5 Equity ounces sold (000) 66.2 11.0 77.2 328.9 92.2 421.1 Equity cash cost per ounce sold $ 131 $ 383 $ 167 $ 121 $ 249 $ 149 Equity total production cost per ounce sold $ 192 $ 551 $ 243 $ 179 $ 332 $ 212
(1) Cash and total production cost per ounce presented on a pro forma co-product basis. 7. Reconciliation of Batu Hijau Costs Applicable to Sales to Total Cash Cost Per Equity Pound, and Total Production Cost Per Equity Pound (dollars in millions except per pound amounts)
Three Months Ended Year Ended December 31, December 31, --------------------------- --------------------------- 2004 2003(1) 2004 2003(1) ------------ ------------ ------------ ------------ Costs applicable to sales per financial statements $ 80.1 $ 56.1 $ 304.7 $ 196.2 Minority interest (38.9) (25.8) (140.7) (90.5) Accretion expense (0.4) (0.7) (1.7) (3.0) Smelting and refining 15.3 15.5 66.0 55.1 Total cash cost for per pound calculation 56.1 45.1 228.3 157.8 Accretion expense 0.4 0.7 1.7 3.0 Depreciation, depletion and amortization 24.4 22.6 89.3 79.9 Minority interest (11.5) (9.9) (39.9) (35.0) Total production cost for per pound calculation $ 69.4 $ 58.5 $ 279.4 $ 205.7 Equity copper sold (000 lbs) 86,850 79,089 378,801 343,378 Total cash cost per equity pound $ 0.65 $ 0.57 $ 0.60 $ 0.46 Total production cost per equity pound $ 0.80 $ 0.74 $ 0.74 $ 0.60
(1) 2003 cash and total production cost per pound presented on a pro forma co-product basis. 8. Reconciliation of Golden Grove Costs Applicable to Sales to Total Cash Cost Per Pound, and Total Production Cost Per Equity Pound (dollars in millions except per pound amounts)
Three Months Ended December 31, -------------------------------------------------------------------------------- 2004 2003 -------------------------------------- -------------------------------------- Total Copper Zinc Total Copper Zinc ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales per financial statements $ 16.0 $ 13.3 $ 2.7 $ 13.8 $ 15.3 $ (1.5) Accretion expense (0.1) (0.1) -- (0.1) -- (0.1) Write-down inventories (0.2) (0.6) 0.4 (0.1) -- (0.1) Smelting and refining and purchased concentrates 6.2 1.4 4.8 10.9 3.4 7.5 Total cash cost for per pound calculation $ 21.9 $ 14.0 $ 7.9 $ 24.5 $ 18.7 $ 5.8 Total sold (000 lbs) n/a 13,862 22,392 n/a 28,136 41,579 Total cash cost per pound sold n/a $ 1.01 $ 0.35 n/a $ 0.67 $ 0.14
Year Ended December 31, -------------------------------------------------------------------------------- 2004 2003 -------------------------------------- -------------------------------------- Total Copper Zinc Total Copper Zinc ---------- ---------- ---------- ---------- ---------- ---------- Costs applicable to sales per financial statements $ 61.8 $ 38.7 $ 23.1 $ 43.5 $ 37.4 $ 6.1 Accretion expense (0.6) (0.3) (0.3) (0.4) (0.2) (0.2) Write-down inventories (8.2) (2.9) (5.3) (7.2) (3.9) (3.3) Smelting and refining and purchased concentrates 29.3 3.8 25.5 27.4 10.6 16.8 Total cash cost for per pound calculation $ 82.3 $ 39.3 $ 43.0 $ 63.3 $ 43.9 $ 19.4 Total sold (000 lbs) n/a 43,467 114,835 n/a 74,303 104,711 Total cash cost per pound sold n/a $ 0.90 $ 0.38 n/a $ 0.59 $ 0.19
9. Reconciliation of Total Newmont Costs Applicable to Sales to Total Copper Cash Cost Per Equity Pound, (dollars in millions except per pound amounts)
Three Months Ended Year Ended December 31, December 31, --------------------------- --------------------------- 2004 2003(1) 2004 2003(1) ------------ ------------ ------------ ------------ Costs applicable to sales per financial statements $ 93.4 $ 71.4 $ 343.4 $ 233.6 Minority interest (38.9) (25.8) (140.7) (90.5) Accretion expense (0.5) (0.7) (2.0) (3.2) Write-down inventories (0.6) -- (2.9) -- Smelting and refining 16.7 18.9 69.8 65.7 Total cash cost for per pound calculation $ 70.1 $ 63.8 $ 267.6 $ 205.6 Equity copper sold (000 lbs) 100,712 107,225 422,268 417,681 Total cash cost per equity pound $ 0.70 $ 0.59 $ 0.63 $ 0.48
(1) 2003 total cash cost per equity pound presented on a pro forma co-product basis. 10. Gold Hedge Position -- Current Maturity Summary (1)(3) (000 ounces)
Gold Put Option Contracts Price Capped Contracts --------------------------- --------------------------- Years Ozs Price(2) Ozs Price(2) - ------------- ------------ ------------ ------------ ------------ 2005 205 $ 292 500 $ 350 2006 100 $ 338 -- -- 2007 20 $ 397 -- -- 2008 -- -- 1,000 $ 384 2009 -- -- 600 $ 381 2010 -- -- -- -- 2011 -- -- 250 $ 392 Total/Average 325 $ 313 2,350 $ 377
The mark-to-market value of the gold put option contracts was negative $8.9 million at December 31, 2004. Notes: (1) For more detailed descriptions, definitions and explanations, refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2004 to be filed in March 2005. (2) Prices quoted are gross contract prices, which represent the gross cash flow per ounce of each contract. Not included in these prices are the additional cash outflows associated with borrowing gold over the life of the contract where the contracts are floating in nature. The rate at which gold is borrowed is determined over the life of the contract based on the prevailing market gold lease rate for the time period that the borrowing is fixed. The borrowing can be fixed for varying periods over the life of the contract. (3) In addition to the gold hedge positions shown in the table above, the Company entered into a prepaid forward gold sales contract in July 1999, which is reflected as debt on the Company's consolidated balance sheet. Under the prepaid forward gold sales contract, the Company agreed to sell 483,333 ounces of gold, to be delivered in June of each of 2005, 2006 and 2007 in annual installments of 161,111 ounces of gold. For more detailed descriptions, definitions and explanations, refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2004 to be filed in March 2005. The Company's fourth quarter earnings conference call and web cast presentation will be held on February 24, 2005 beginning at 4:00 p.m. Eastern Time (2:00 p.m. Mountain Time). To participate: Dial-In Number: (773) 756-0828 Leader: Randy Engel Password: Newmont The conference call will also be simultaneously carried on our web site at www.newmont.com under Investor Information/Presentations and will be archived there for a limited time. Investor Contacts Randy Engel Telephone: (303) 837-6033 Email: randy.engel@newmont.com Wendy Yang Telephone: (303) 837-6141 Email: wendy.yang@newmont.com Jennifer Van Dinter Telephone: (303) 837-5165 Email: jennifer.vandinter@newmont.com Media Contacts Doug Hock Telephone: (303) 837-5812 Email: doug.hock@newmont.com Cautionary Statement This news release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the safe harbor created by such sections. Such forward-looking statements include, without limitation, (i) estimates of future gold and other metals production and sales; (ii) estimates of future cash costs and total production costs; (iii) estimates of future capital expenditures, expenses and tax rates; (iv) estimates regarding timing of future production or closure activities; (v) statements regarding future exploration results and the replacement of reserves; (vi) statements regarding future asset sales or rationalization efforts; and (vii) estimates of future royalty revenues. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, political and operational risks in the countries in which we operate, and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company's 2003 Annual Report on Form 10-K, which is on file with the Securities and Exchange Commission, as well as the Company's other SEC filings. The Company does not undertake any obligation to release publicly revisions to any "forward-looking statement," to reflect events or circumstances after the date of this news release, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. SOURCE Newmont Mining Corporation -0- 02/24/2005 AA LATH060 /PRNewswire -- Feb. 24/ /END FIRST AND FINAL ADD/ /Web site: http://www.newmont.com / -----END PRIVACY-ENHANCED MESSAGE-----