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Breaking News from The Globe and Mail

Monday, February 27, 2006

Denver — Gold producer Newmont Mining Corp. reported Monday a 67-per-cent slide in fourth-quarter profit, as higher operating costs and one-time charges offset revenue growth. Its shares tumbled more than five per cent.

Net income slid to $62-million (U.S.), or 14 cents a share, from $190-million, or 42 cents a share, in the year-ago quarter.

Income from continuing operations came to $72-million, or 16 cents a share, down from $150-million, or 34 cents a share, in the previous fourth quarter.

Chairman and chief executive officer Wayne Murdy said the lower earnings resulted from industrywide cost pressures and several accounting items. The latest quarter included writedowns of 6 cents a share on long-lived assets and 9 cents a share on goodwill, as well as a settlement of a civil suit that lowered earnings by 4 cents a share.

Revenue rose to $1.31-billion from $1.2-billion in the prior-year period. The company posted an average realized gold price of $472 per ounce versus $426 a year ago. At the same time, sales costs per ounce increased to $230 from $211.

Analysts polled by Thomson Financial predicted earnings excluding one-time items of 36 cents per share on $1.4-billion in revenue.

Net income for the full year fell to $322-million, or 72 cents per share, from $443-million, or $1 per share, in 2004. Revenue was essentially flat year over year at $4.41 billion.

At year end, Newmont had proven and probable gold reserves of 93.2-million equity ounces.

Newmont shares fell $3.32, or 5.7 per cent, to close at $54.78 on the New York Stock Exchange. Its stock price has ranged between $34.90 a share and $62.72 a share in the past year.

Based in Denver, Newmont is one of the world's leading gold producers with operations in Nevada, Australia, Peru, Indonesia, Canada, Uzbekistan, Bolivia, New Zealand and Mexico.

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