Newmont Corporation (NYSE:NEM) Q2 2025 Earnings Call Transcript

Newmont Corporation (NYSE:NEM) Q2 2025 Earnings Call Transcript July 25, 2025

Operator: Hello, and welcome to Newmont’s Second Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Chief Executive Officer, Tom Palmer. Please go ahead.

Thomas Ronald Palmer: Thank you, operator. Hello, everyone, and thank you for joining our call. Today, I’m joined by Natascha Viljoen, our President and Chief Operating Officer; Peter Wexler, our Chief Legal Officer; and as recently announced, our Interim Chief Financial Officer, along with the rest of my executive leadership team and we will all be available to answer your questions at the end of the call. Please note our cautionary statement and refer to our SEC filings, which can be found on our website. As we reported yesterday, on Tuesday this week, two fall of ground incidents occurred at our Red Chris operation in British Columbia, locking the access way to the underground work area of our nonproducing project at these sites.

At the time of the initial incident, we had 3 business partner employees working underground, more than 500 meters beyond the affected zone. We asked them to relocate to a designated refuge chamber and confirmed that they have safely arrived in the chamber before the second fall of ground blocked the access way. This second fall of ground also impacted our underground communication system. All appropriate emergency response protocols were immediately activated and operations at Red Chris have been suspended whilst we’re responding to the incident. Along with the support from emergency responders and teams from nearby mine sites, our focus is on restoring communications to the refuge chamber, safely reestablishing access underground and bringing our 3 teammates back to the surface and to their families and friends.

We are diligently responding to this incident with excellent support from the broader industry and appreciate your understanding during this very live and evolving situation. Although overshadowed by this incident at Red Chris, Newmont delivered another strong operational performance in the second quarter, keeping us firmly on track to achieve our 2025 guidance. Underscoring this performance are our 3 key priorities for this year, which remain clear and unchanged. First and most importantly, to strengthen our safety culture; second, to stabilize our 11 managed operations; and third, to execute on capital returns. As I just described, we are concentrating the full force of our organization on the safe recovery of our team members at Red Chris, and we will conduct a thorough and independent investigation into the factors that led to this event.

All findings and lessons learned will be leveraged across Newmont to strengthen our Always Safe program and will be shared across the broader mining industry. You can also expect that we will continue to provide regular updates as those efforts progress. Turning to our ongoing work to stabilize our operations. Our portfolio of world-class gold and copper assets delivered another solid quarter. We produced 1.5 million ounces of gold and 36,000 tonnes of copper, remaining in line with our full year guidance and the indications we provided on our last call. This strong production supported robust financial results, including $2.4 billion of cash flow from operations after working capital, and an all-time record for quarterly free cash flow of $1.7 billion, of which more than $1.5 billion or 90% was generated by our core managed operations.

Our shareholders continue to benefit from our noncore asset divestment program that we successfully completed earlier this year. As we announced last week, we expect to receive approximately $470 million in cash proceeds after taxes and commissions from the sale of our shares in Greatland Gold and Discovery Silver, shares that we received as consideration for the divestments of Telfer and Porcupine, respectively. As a consequence, we now expect to generate $3 billion in after-tax cash proceeds this year from our divestment program. And these proceeds will be used to support our third key priority, returning capital to shareholders. Since our last earnings call, we have retired $372 million of debt and returned over $1 billion to shareholders through both regular dividends and share repurchases.

And in addition to making meaningful progress on our existing program, our Board has approved an additional $3 billion share repurchase program, doubling our total authorization to $6 billion, of which $2.8 billion has been executed to date. With our strong second quarter results and continued operational and financial momentum, we remain firmly on track to meet our 2025 guidance, whilst also generating industry-leading free cash flow and consistently returning capital to shareholders through a predictable dividend and ongoing share repurchases. With that, I’ll now turn it to Natascha for an update on our operations.

Natascha Viljoen: Thank you, Tom, and hello, everyone. Before we jump into the details, I’d like to echo Tom’s statements about our team members at Red Chris. Above all else, we are focused on bringing them home safely, and we are leveraging the strength and extensive experience of our global technical, operational and safety teams with the support of our industry partners. Shifting now to our operational performance. This quarter underscores the resilience of our world-class portfolio, which has been thoughtfully assembled around high- quality, long-life assets. With this robust foundation in place, we are exceptionally well positioned to organically deliver multi-decade value through our high-caliber operations, robust pipeline of projects and deep bench of technical and operational leaders.

Our second quarter operational results outperformed our previous expectations, effectively bookending the first half of the year and establishing a solid foundation for consistent delivery in the second half. This compelling performance was largely driven by production from our core managed operations, including higher-than-expected production from Cadia in the first half of the year due to higher grade ore from the current panel cave. And in addition, we have been able to noticeably reduce downtime related to planned maintenance. As previously mentioned, we expect production to decrease in the second half of the year as we continue to transition to our new panel cave, PC2-3. Peñasquito exceeded our gold production expectations in the first half of the year due to higher grade ore from the Peñasco pit.

However, production is expected to shift from a higher proportion of gold to a higher proportion of silver, lead and zinc content, primarily in the fourth quarter as we move to lower gold grade areas in the Peñasco pit as part of a planned sequence in this large polymetallic mine. And at Lihir, we delivered consistent production in the first half of the year. However, this will begin to decline in the second half of the year as we begin processing lower-grade material as part of our planned mine sequence. What really stands out at Lihir is the steady progress we’re making in bringing stability to both the mine and processing plant. For example, we are beginning to see the benefits from improved drainage and water management around our haul roads, along with cleaner access to both pit and stockpiles, creating a safer and more efficient design for this mine.

As a result, we’ve been able to park 9 trucks and materially reduce the contractor footprint, generating significant cost savings from these initiatives alone. For the last 2 years, we have been on a journey of integration, rationalization and optimization with a view to creating value over a period of decades. With the rationalization phase largely complete, we have been applying the full force of our operating and technical capability to systematically optimize operations across all 11 of our managed operations. And as reflected in our results, these stabilization efforts are delivering tangible benefits, positioning us to confidently continue our optimization work. With a deep understanding of each and every asset, we are working on productivity enhancements and improvements to the cost structure across our managed operations, ensuring each site meets the performance metrics required to earn its place in our world- class portfolio.

You saw an example of this at the beginning of the year when we paused our investment in the underground expansion activities at Cerro Negro and again, more recently, with the cost improvement measures we are working on at Merian. Building on the strong production performance from our core managed operations in the first half of the year, we remain firmly on track to meet the full year guidance ranges we issued in February. Turning now to our cost performance. We remain on track and are continuing to focus on driving improvements across our portfolio. As mentioned, sharpening our efforts on cost discipline and productivity enhancements has been a primary focus for all of us at Newmont. And as a result, our cost applicable to sales and our all- in sustaining costs are in line with the guidance expectations set at the beginning of the year.

Finally, our capital spend for 2025 is on track to land within the guidance ranges we set at the beginning of the year. Starting with sustaining capital. We anticipate spending to be approximately 57% weighted towards the second half of the year, driven by deliberate decisions to defer expenditures for key activities across several sites, including planned spending at Tanami associated with our expansion of our ventilation system in the second half of the year, purposefully moving some of our ongoing optimization work at Lihir to the third and fourth quarters with a specific focus on asset integrity and reliability and a continued surface work at Red Chris and Brucejack during the warmest summer months in Canada. Higher sustaining capital in the second half of the year will also include an expected increase at Cadia to support the ongoing panel cave development as well as addressing the historical underinvestment in tailings remediation and storage capacity, while we continue to evaluate more efficient tailing solutions at this world-class operation.

Our development capital follows a similar guidance and is now expected to be 51% second half weighted, primarily due to the timing of spend related to the projects currently in execution. At our Ahafo North project, we are progressing as planned and are preparing to pour first gold in the coming months, keeping us firmly on track to declare commercial production in the fourth quarter as previously indicated. In parallel, we successfully completed the 160-meter raise bore at the bottom of the shaft at our second expansion at Tanami and have removed the pentice or an [ inshaft ] barrier, which allows the safe and efficient completion of this critical path work. And finally, at Cadia, [indiscernible] from PC2-3 has continued according to plan while steadily advancing the underground development for PC1-2 and progressing the important tailings remediation and storage capacity works I mentioned previously.

I now will turn it back to Tom to go through our financial results for the quarter.

Thomas Ronald Palmer: Thanks, Natascha. I’d like to start this update by acknowledging the recent departure of Karyn Ovelmen, our Chief Financial Officer. Whilst the timing was unfortunate, we respect her decision and thank her for her contributions to Newmont over the last 2 years. We have commenced a comprehensive search for our next CFO. And while we do that work, we continue to have a very strong and experienced finance team in place, being capably led by Peter Wexler on an interim basis. Importantly, there are no changes to our financial policies or capital allocation strategy, and we remain on track to deliver on our 2025 commitments and continue returning capital to shareholders. As I mentioned at the start of the call, Newmont reported strong financial results in the second quarter, driven by robust production, steady unit costs and a supportive gold price environment.

Gold all-in sustaining costs for the quarter were slightly below our guidance for the full year at $1,593 an ounce on a co-product basis. This is largely due to lower sustaining capital spend in the first half of the year, which as Natascha just described, is expected to increase in the second half by comparison. As a result, all- in sustaining costs are expected to be higher in the third and fourth quarters, but overall in line with the indications we provided in February for the full year. I also want to highlight that going forward, we plan to more prominently present our unit costs under both the co-product and by- product methodologies to better assist our investor base with industry benchmarking and comparisons to our peers. By providing our unit costs under both methods, we aim to offer our investors better insights into the individual contributions of the metals that we produce in addition to gold, whilst also providing a more comprehensive view of Newmont’s overall margin performance.

To put this into perspective, on a by-product basis, our gold all-in sustaining costs for the second quarter were $1,375 an ounce, which is more than $200 an ounce lower than our unit costs under the co-product method. And from our core managed portfolio in the second quarter, our gold all-in sustaining costs were $1,276 an ounce on a by-product basis. For the second quarter, Newmont generated $3 billion in adjusted EBITDA and reported an adjusted net income of $1.43 per share. The most material adjustments to net income for the quarter include $0.63 related to a gain from the sale of [ Akyem ] and Porcupine as part of our noncore asset divestment program, $0.14 related to mark-to-market gains on equity investments, primarily from the gain on the sale of shares received as proceeds for the sale of our Telfer operation and interest in the Havieron project to Greatland Gold, and $0.31 in offsetting taxes primarily related to these adjustments.

But most notably, Newmont generated $2.4 billion of cash flow from operations and $1.7 billion of free cash flow, well above the first quarter and setting a new record quarterly cash flow performance. Our operating cash flow in the second quarter benefited from $156 million of favorable working capital adjustments, primarily driven by sales timing and higher revenue and pretax income associated with strong metal prices. We are encouraged by the strength of our cash flow performance in the first half, which underscores the quality and potential of the world-class portfolio we have assembled and continue to shape and optimize. With this in mind, we remain committed to our shareholder-focused capital allocation strategy, which remains unchanged and has 3 priorities: to maintain a strong balance sheet, to steadily fund cash-generative organic projects and to continue to return capital to shareholders.

Starting with our balance sheet. We finished the quarter and the first half of the year with $6.2 billion in cash, well above our target of $3 billion on average. It’s worth noting that this cash balance includes $330 million of the approximately $470 million in cash proceeds, net of taxes and commissions from the sale of our equity shares in Greatland Gold and Discovery Silver. In addition, we continue to surpass our debt target of up to $8 billion and reached an outstanding principal balance of $7.4 billion as of June 30. And we are proactively assessing opportunities to further reduce our outstanding debt, creating a flexible and resilient balance sheet that is able to navigate the commodity cycle. Turning to shareholder returns. We declared a fixed common second quarter dividend of $0.25 per share, consistent with the past 7 quarters.

And since our last earnings call in late April, we repurchased $750 million of shares, bringing the total shares repurchased in 2025 to $1.5 billion. In total, since February last year, we have executed $2.8 billion in share repurchases. And as I mentioned earlier, our Board has approved an additional $3 billion share repurchase program. This brings our total authorization to $6 billion, demonstrating the confidence that we have in our business and our commitment to rewarding our shareholders with predictable dividends and ongoing share repurchases in 2025 and beyond. In closing, we delivered a strong second quarter and first half of the year and remain on track to achieve our 2025 guidance and deliver on our commitments for the benefit of our shareholders.

We achieved an all-time record quarterly free cash flow of $1.7 billion in the second quarter, and we continue to advance our disciplined capital allocation strategy, which includes strengthening our balance sheet through ongoing debt reductions and returning capital to shareholders through a predictable dividend and continued share repurchases, for which we have approved an additional $3 billion. Looking ahead, we will lean into the full capability of our teams and portfolio to leverage the momentum from our core managed operations in the first half of the year and continue building a stable and resilient future for Newmont. In turn, we are well positioned to reward our shareholders through growing free cash flow per share and consistent capital returns.

However, we recognize that none of this matters until we bring our 3 Red Chris teammates home safe and sound. And with that, I’ll thank you for your time and turn it back over to the operator to open the line for questions.

Q&A Session

Operator: [Operator Instructions] Our first question today comes from Lawson Winder from Bank of America.

Lawson Winder: Very nice quarterly result, and thank you for today’s update. Can I ask about your capital allocation priorities as it pertains to acquisitions? Certainly, your valuation has improved, your results have improved and you’re generating significant free cash flow. Is there an appetite for further acquisitions at Newmont? And then further to that, is copper still viewed as a strategic metal for Newmont as it pertains to acquisitions?

Thomas Ronald Palmer: Thanks, Lawson, and good afternoon. I’ll be as clear as I can. Our focus is internal. And the best use of our capital is to buy back Newmont stock. And that’s where you’ll see us spend our time and attention. So internal focus, buying back Newmont stock. The question around copper, we have copper-producing assets in Red Chris, Boddington and Cadia. And we have a magnificent organic project pipeline. Next cab off the rank is the — likely to be the Red Chris block cave, which is a copper-gold mine. And so you will see us focus on a balance of copper in our portfolio as a gold mining company, but that copper exposure will come from our organic growth.

Operator: Our next question today comes from Daniel Major from UBS.

Daniel Edward Major: The first one, perhaps on management changes and management succession. Obviously, I guess, Karyn’s departure was somewhat unexpected. Certainly, there’s been some discussion in the market around Natascha’s appointment of President, whether that’s a precursor to any other management changes. I wonder if you can make any comments on this and whether Karyn’s departure impacts any other potential thinking about succession.

Thomas Ronald Palmer: I have a couple of comments. As I said in my prepared remarks, it’s unfortunate, Karyn resigned, but I’ve literally got sitting around me our finance leadership team and a really capable and experienced group of people. So we won’t miss a beat. And in Peter Wexler, we have a very capable interim Chief Financial Officer. So absolutely no concerns in terms of the strength and capability of our business. And I think we’ve got a real opportunity to think about the next CFO that we bring in for the next exciting chapter of Newmont. So that’s part of a natural progression evolution in organizations. So very comfortable with where we sit with our existing team in the interim and actually pretty excited about the opportunity we have in terms of that recruitment process.

In terms of — and I didn’t pick it up in our prepared remarks, but I’ll take your question to have the opportunity to congratulate Natascha on the promotion to President and Chief Operating Officer, which we announced back in early May. Natascha has been with us almost 2 years now and has consistently demonstrated strong leadership and a deep commitment to safe and disciplined operational delivery. And the expanded role is the opportunity to give Natascha a balance of both strategic and operational focus and also an opportunity for her energy and passion and resolve to be — continue to be critical attributes as we work to improve safety, cost and productivity over time. Her move to President is part of ongoing leadership development. It’s something that Newmont has done for generations, something that Newmont has done incredibly well.

And I wouldn’t read anything more into it other than a natural process of Newmont doing what Newmont has done very well for many years. And I’m sitting in this room looking around a number of people who have benefited from Newmont having a focus on leadership development, and I’m also a beneficiary of that. So hopefully, Daniel, that gives you some color in terms of both the finance team and also Natascha [indiscernible].

Daniel Edward Major: Great. That’s some great color. And then the second question, just of cash flow outlook. You benefited from some working capital items during this period, I think payables, receivables. Any color on kind of any reversal and how that might impact free cash flow in 2H? And then the second part of the question, could you just remind us on how much of deferred proceeds from the divestments you have remaining and when they will expect to be coming?

Thomas Ronald Palmer: Yes. Thanks, Daniel. What you’ll see with the free cash flow generation in the second half of the year is it’s going to be pretty steady production coming through. So for instance, third quarter is going to look pretty similar to the second quarter. As [indiscernible], we’ll see a step up in our sustaining capital in terms of that first half to second half weighting pushing up to around 50% weighted in the second half. So obviously, that will come off our free cash flow. The other one to look at is our reclamation. And if you see first quarter to second quarter, that stepped up, and that’s about us building the momentum around the construction of the 2 big water treatment plants down at Yanacocha. So you’ll continue to see an increase in that spend.

I think it’s around $600 million or thereabouts we want to spend this year on that. So that will step up to a steady state rate. So you’ll see a bit more sustaining capital, steady production and some of that reclamation spend will be factors in second half free cash flow. And of course, the other area to keep in mind is we’re enjoying current gold price levels, and we’ll start to see some tax payments from those higher gold prices, taxes and royalties start to flow through. In terms of the — some of the equity positions, we’re able to — basically, we’re out of Discovery Silver. So there’s nothing left there. So those sales over the last couple of months, I mean that [ Tony and team ] can charge on and deliver from Porcupine. We’ve still got some shares in Greatland Gold that are part of that transaction.

I think — and a deferred — we’ve got deferred cash payments from both Discovery, and we’ve got some deferred contingent payments. I think we announced at Discovery, the deferred cash payments are around $150 million, and they’re payable in equal tranches over a 4-year period starting at the very end of 2027. And then in Greatland Gold, we’ve got some deferred contingent payments in the order of about $100 million. And we’ve got about 9.9% left in Greatland Gold, and there’s some covenants around when we can dispose of that. We’ve quite a position in Orla still that came with the Musselwhite sale, free and clear of Éléonore in terms of Dhilmar, free and clear of Akyem with Zijin. I think, Daniel, that probably gives you the — some of the key items in terms of that divestment program.

Operator: The next question today comes from Fahad Tariq from Jefferies.

Fahad Tariq: I want to focus a little bit on Cadia and Peñasquito, which were clearly very strong in the second quarter on high grades. Can you maybe walk through production, why production is expected to decline specifically in the third quarter for these 2 mines? I know there’s a bit of a transition, but I’m just — I think you’d have to see a pretty significant grade drop off in the third quarter to see production come up. So I’m just trying to get more color on how to think about grades into the third quarter and just production at these 2 mines in the third quarter.

Thomas Ronald Palmer: Thanks, Fahad. Your line was a little crackly. So for those that might not have heard, just looking for some color in terms of the balance between first half and second half for Cadia and Peñasquito. And I’ll ask Natascha maybe to talk about those operations and how we see that [ production grade ].

Natascha Viljoen: Thanks, Tom. And thanks for that question, Fahad. And obviously, both of these operations are key to our portfolio. If I can start with Peñasquito, we — this year, we’re seeing the benefits of the work and the investment we’ve done in that open pit and pushbacks that we’ve done during last year. We’ve moved into of the Phase 7 of the Peñasco pit, largely moved out of Chile Colorado. Peñasco pit, variable ore body, specifically variable as far as the different metals are concerned. And it’s just the natural progression as we mine and follow our mine sequence through the Peñasco pit that we do see different grades coming through. So we will see lower grades in — of gold in the third quarter, and we will see higher grades of silver, lead and zinc coming through.

So typical indications about 2% higher silver and about 1.5% higher zinc, and we’ll see a reduction in — an associated reduction in our gold grades. As far as Cadia is concerned, Cadia, of course, one of the newer operations in our portfolio. We have done quite a bit of work to understand this operation and all of the requirements to run it on the — as a quality asset as we should. As we see the first 2 block caves, PC1 and PC2 come to the end. We do see some model benefits from PC2, where the model has been predicting lower grades through PC2 as we come to the end of its life, but we do see the grades still hold strong as we complete the mining of PC2. And then, of course, we will slowly, but surely, we’re starting to ramp up PC2-3, and we will see that going through an original lower grade and then ramping up steadily into full production and higher grades.

And it’s doing exactly as we expected — it’s that — as we expected it to.

Operator: The next question today comes from Matthew Murphy from BMO Capital Markets.

Matthew Murphy: Great quarter, and we wish you great success in this rescue operation. I wanted to ask a question about Lihir. It seems to be doing really well. And Natascha, you talked about some of the improvements being realized, and that’s even before you’ve spent much CapEx on it. So as the spend picks up in the back half, how does that set it up for 2026?

Natascha Viljoen: Matthew, a really great question, and it is another one of our big operations that we feel quite excited about. And I think you might remember that for a period of time, we’ve been talking about how we build stability in that operation. It gave us the opportunity to relook the mine design, some of the basics like road design, specifically around water management on the various roads. What that has resulted in is far higher productivities for us in mine because we can manage water better off our haul roads. We get — our fleet can run faster. And we’ve been able to park a number of trucks, as I said in our remarks, 9 trucks in the process. We’ve built on that by creating a buffer between the mine and the plant with intermediate stockpiles, which gives us both the opportunity to ensure a stable feed into the plant, disconnect the mine from the plant and get more stable grades through the plant as well.

The team has made material progress in how we think about the asset management of that asset, specifically starting with our big shutdowns, ensuring and being very considered around our big plant shutdowns. You might remember at the end of last year, we had basically 2 — our biggest autoclave and another autoclave down for maintenance. And with the skills that the team has been developing focus on big shutdowns, we have seen that shutdown coming ahead of time. We continue to build on that maturity in really creating stability in the plant, not only through more stable feed from the mine, but just higher levels of reliability. I have to recognize, though, that we still have a bit to do. The plant still needs quite a bit of work in terms of asset management and reliability.

And we are continuing to build the capability, the planning and execution capacity that we have on site.

Thomas Ronald Palmer: Maybe just a couple of builds, Matt, on Natascha’s summary. We’re very much about, as we’ve talked about over the course of a number of these calls, a big mine like Lihir, setting it up for the long term. So what Natascha is describing is the actions we’re taking for an asset that’s been a big asset in our portfolio. So it’s been the elephant in the portfolio. It now sits with a number of other peers in the Newmont portfolio, and we’re making deliberate decisions to set this mine up for the long term. It’s what that ore body and that installed infrastructure and the people at Lihir are looking for from us. And we also have at Lihir, one of our strongest general managers in, Dawid Pretorius, a man I’ve known for a better part of 25 years and a really, really strong general manager. Big complex mine like this is well suited to his set of capabilities.

Natascha Viljoen: And a very skilled people leader as well, which is something that, that operation thrives under.

Operator: Our next question today comes from Josh Wolfson from RBC Capital Markets.

Joshua Mark Wolfson: Great job on the cost containment for total cash cost year-to-date. I’m wondering if you can provide any more details on some of the trends you’re seeing in your underlying cost structure, I guess, including inflation rates and if there’s anything notable regionally as well?

Thomas Ronald Palmer: Yes. Thanks, Josh. Largely, what we’re seeing play out is consistent with expectations that we set as we build our business plan and guided at the beginning of the year. Some swings and roundabouts with fuel, energy, materials and consumables, but not significant. So we’re largely — the cost we expected to see, we’re seeing this year. And labor is pretty much holding as we’d expect, both contracted services and our own employees. So what we expected is certainly playing out this year and the assumptions we made about inflationary impacts in all of those different categories is consistent with what we assumed even in the elevated gold price environment. Clearly, we’re seeing the higher taxes and royalties associated with that.

In Natascha’s comments, she talked about stabilizing this portfolio and then looking to optimize the portfolio. And we are very much focused on where we can get after productivity improvements and also enhancements to our cost structure. So we’re absolutely not sitting on our laurels saying, “Oh, we’re meeting expectations for what we assume for this year.” We recognize that this portfolio, which is still relatively new in terms of how we’ve shaped it, both the acquisitions, the integrations, the rationalization, and we are very much focused on productivity levels from every operation that meets our expectations and industry benchmarks and ensuring that’s being supported by the appropriate cost structure. So we continue to actively work that even though our costs are meeting the levels that we expected this year as we built our plan and guidance.

Joshua Mark Wolfson: Got it. And as you sort of navigate stabilizing the operations, when we think about 2026 and what we should expect at that point, has there been any thought towards which of the larger project updates we could expect and whether the outlook will be beyond just a 12- month basis?

Thomas Ronald Palmer: It’s just probably a couple of thoughts in terms of answering that question, very much sitting at the halfway mark focused on ensuring we safely deliver second half of this year, such a critical year given the challenge we’ve been through. So I want to make sure that our eyes are firmly on that task. And in that as we move into — we’ve started the process now building our business plan for next year, and that’s work that’s very active at the moment. Our expectations would be that in February of next year, we’d do something similar to this year and we’ll be focusing on giving the market a set of numbers for the 2026 year. But we’re — at the moment, the sleeves are rolled up, and we’re head down, tail up getting after what we can do to deliver ’26 business plan.

So very much work in progress. On the project side of things, really important that we deliver — safe to deliver first gold and commercial production out of Ahafo North, continue to progress the Tanami expansion and continue to progress the two panel case at Cadia. But we are actively working our project pipeline. And I think, as I’ve mentioned on previous calls, Red Chris is a project that’s close to shovel-ready, and we’re ensuring that we have a feasibility study to a Newmont standard that, that project washes its face and that we have the various consent and permits to be able to progress with that project. So very much focused on that project and whether that could come up to the mark to be considered for full funds in the 2026 time frame.

Operator: Our next question today comes from Daniel Morgan from Barrenjoey.

Daniel Morgan: How should we read production guidance? Basically, I think you beat your own plans by circa 100,000 ounces this quarter. Just trying to clarify, was that unexpected bonus versus the plan? Was it a bring forward of stuff in the second half to first half? Or how do you — why not lift guidance somewhat? Is it pitch conservatively? Or have you just brought forward ounces from half 2?

Thomas Ronald Palmer: Yes. Thanks, Daniel. If you think about — I think, as Natascha answered the earlier question, you’ve certainly got a couple of big assets in Cadia and Peñasquito. Cadia moving into some lower grades out of those panel caves is what our expectations are. And we have the benefit of some positive reconciliations in the first half that’s flowing through. So we will still remain sober in terms of what the model is telling us for Cadia out of those cases in the second half. Peñasquito is running beautifully. And so we were able to get some good production through and through some of that material and benefited from some higher metal production in the first half, but we do move into those lower grades in the second half.

We look to the second half, we’ve got Nevada Gold Mines is a pretty important contributor in the second half, fourth quarter weighted. So again, we’ve — it’s a not insignificant part of our Newmont portfolio. And so we want to make sure we’re cautious around ensuring that we can see that line of sight in the second half. And we got Yanacocha, we’ll get some expecting — we’ll have a stronger second half in terms of the injection leaching work we’ve got happening on the heap leaches there. And we’ve got Ahafo North commission. Commissioning a new project has some risk associated with it. So again, being prudent in terms of how we think about the second half. So that’s a little bit of color, hopefully, Daniel. And when I think about where we sit with our production, yes, we’ve had a good solid first half.

We provided a number, which had a range around it. I think we’re still sitting comfortably within that range. And so we’re firmly on track to meet our guidance.

Daniel Morgan: And just a follow-up question, possibly one more for Natascha, which I guess is two parts, it’s projects. So first, it’s — can you please just expand on the Tanami shaft works? Is the risk of overbreak now behind us? Is that concrete line? Maybe go into a bit more detail? And then just on Ahafo, can you expand on the works remaining to first production and any risks that are front of mind?

Natascha Viljoen: Thank you, Daniel. Let me start with Tanami Expansion 2. The risk of the overbreak on the lower part of the shaft is truly behind us. We have completed the raise bore through the concrete [indiscernible] that we’ve bought over — at the beginning — well, end of last year into the beginning of this year. The pentice has been removed. So we now have clear access to the entire shaft. And we started with — we’re still putting a lining in at the bottom half or the bottom end of that shaft to make sure that there’s alignment with the top half and that there’s smooth access to the bottom. The equipping of the top half is progressing well. And as soon as we complete the lining in the bottom half or the last bit of the shaft, we will complete that equipping as well.

Underground operations are going to schedule. So I think everything there, the highest risk elements are behind us. And now it is the focus on completing the remaining work under the leadership of also a very strong Project Director, General Manager, Leigh Cox and that team is going from strength to strength. Ahafo North is making good progress. We are getting ready for commissioning. We have indeed started commissioning in certain areas of the plant. As you would remember, we have started mining. We’re stockpiling material to get ready for the commissioning of the plant. So we’re very well on track. It’s a little bit of a small ball pipe being left, a little bit of electrical work still left. But by and large, the large construction work basically is complete.

And we’re very excited to go and see the first gold pour.

Operator: Our next question comes from Anita Soni from CIBC.

Anita Soni: I just wanted to ask a little bit more about Red Chris. On Red Chris, could you just let me know — I think you had mentioned that there was an initial fall of ground. And then the — and the workers were asked to go to a refuge station. That fall of ground, did that happen in the decline?

Thomas Ronald Palmer: Yes, the decline, about 200 meters down the decline. There was an initial fall of ground that was detected. And so the emergency response protocols kicked in place. We only had those 3 people in that area. So it’s not an operating mine. It’s some developer being done as part of preparing hopefully for the Red Chris project in the coming period of time. So these 3 folks, when that event occurred, call went out, please make your way to refuge chamber, which they did. They got themselves into the refuge chamber, radioed in that they were safely there. And then shortly after that, in that same area, in the decline, we had the larger fall of ground that blocked the access play and took out the leaky feeder cable, which has taken out our communication to the refuge chamber.

So as I talked about then in my prepared remarks, our focus is on reestablishing communication back to the refuge chamber to confirm that all are safe and well, whilst we work on various plans for getting access to rescue them. So we’re working on plans to get access down through that decline again to do so safely. We’re also — we also have a secondary area to access, which would be through a vent shaft. So we’re considering different methodologies to do that. So a whole bunch of people, both at Red Chris, the wider Newmont, and it is amazing the wider industry — how the wider industry comes together to support with solutions and equipment and plans. So these are the 2 things that are happening in parallel, getting communication reestablished and determining the safest and most effective rescue plan for the 3 people.

Anita Soni: Okay. I hope they’re safe and well and you get them out quickly. My second question is with respect to some of the changes that you — the capital spending. I just want to get an understanding why the capital spending was shifted. I think you said it was deliberately, but in terms of — I think Natascha said that there was some in order to maintain integrity of the mine at Lihir. Could you just elaborate on those comments?

Natascha Viljoen: Anita, I think as I [indiscernible] probably a little bit earlier on the work that we are doing at Lihir around our asset integrity work in the plant. And there’s also a big power plant that we are maintaining. We have been — as we plan and make sure that when we take large shutdowns that we do effective work and that we spend our capital effectively. As whilst we’re talking about capital allocation, I think, hand in hand with that is capital discipline and being sure that when we start to spend the capital that we’re ready to spend it effectively. So we did make a deliberate decision on spending that a little bit later in the year. Other areas would have been our [ vent raise 9 ] at Tanami. That is work that has also developed through the productivity work that we have been doing, identifying a need for us to enhance some of our ventilation work to enhance some of our productivity and development work at Tanami.

And that’s why that work will actively be happening in the second half. And then lastly, just the summer period of works with Brucejack and Red Chris. And it just happened that the spend moved a little bit more into the second half than what was planned originally.

Operator: Our next question comes from Tanya Jakusconek from Scotiabank.

Tanya M. Jakusconek: And again, I just hope that the miners get out safely as well. Just a couple of questions, if I [ could ]. The first one is just coming back to your portfolio. I think Tom, this is for you. You mentioned Greatland Gold, you still have some position there. I think you mentioned they’re noncore. So those ones could be divested of — you mentioned Orla, you have an equity investment in that as well. Is that noncore position as well?

Thomas Ronald Palmer: I think the simplest answer to both of those, Tanya, I think as we think about the Newmont portfolio and how we want to focus our time and effort and manage this portfolio and simplify this portfolio as much as we can, both those positions you described, will I put in the noncore category.

Tanya M. Jakusconek: Okay. And I just wanted to check where your Lundin Gold position also stands in terms of that position because that’s also a big position.

Thomas Ronald Palmer: Very comfortable with our 32% interest in Lundin Gold and the Fruta del Norte asset. And I think it’s something — we’ve only had a minute with all the other work we’re doing. So Ron Hochstein and crew are doing a terrific job running that asset. And there’s a bunch of stuff we can learn from a great operator like Ron. So we want to understand and learn from that asset, but very comfortable with that position in our portfolio.

Tanya M. Jakusconek: Okay. And sorry, lastly, I just want to ask is this Wafi-Golpu. Have you had a chance to look at that? Is that fit at all?

Thomas Ronald Palmer: Wafi-Golpu is certainly, we see that as an important asset, important project in our organic project pipeline. It’s something that we’re actively working on in terms of negotiations with the PNG government on converting a framework memorandum of understanding to a mineral development contract, which then enables you to get a special mining lease. Working very closely with the team at Harmony as we navigate through that. So very much looking at Wafi-Golpu as an important project in our organic project pipeline. And these negotiations are important in getting some clear stability around any investment decisions that may come down the track with a project such as Wafi-Golpu.

Tanya M. Jakusconek: Okay. Natascha, if I could ask one for you. I mean I look at the portfolio and congrats on getting this portfolio stabilized. That’s great to see. As you think about your core portfolio, where do you see — and you talk about all these productivity improvements, where do you see the greatest bang for your buck in terms of productivity? Like what assets do you think that we could see really improvements in productivity that would actually show really good cost?

Natascha Viljoen: Tanya, it’s going to be difficult to choose that one because I think the opportunities are different at every asset, but there are certainly opportunities for us across the board. I can perhaps tie to bookends as examples. The one bookend would be absolutely at Lihir, one of our big assets, plenty of opportunity that will help us to make big step changes, long-term asset and continuously thinking about — and it’s got several different aspects to how we improve that. There’s material, people aspects that we’re focusing on asset management focus areas, mine layout and design for productivity all the way into our tailings management. So really a diverse set of opportunities for us at Lihir. And then obviously, I think at Lihir also a very unique opportunity for us to make an impact on the community of that Lihir Island.

On the other bookend, probably, I will reflect on Cerro Negro, which has got a beautiful ore body. And our biggest challenge is productivity. We have assets that’s in good state. We don’t have major challenges with reliability of our assets. And we are working closely with our employees, with our unions on site to — with an unwavering focus on how do we lift the productivity on that asset. So more of a singular focus on how do we do more with the assets and the teams that we do have. And then we have in between a couple of assets that either in as a full asset or in unique opportunity, and unique areas are certainly benchmark. Peñasquito is one such an asset. We’ve recently worked through asset reviews where we did a multidisciplinary deep dive through all of our assets.

And Peñasquito in every aspect, there’s quite a bit for us to take learnings and take that across all of the operations. And then very recent, we’ve had the same experience with Cadia on their asset management strategies, asset management processes specifically that we will leverage from and make sure that we use that across all of our other assets. So different for different assets and everyone unique opportunities.

Operator: Our final question today comes from Hugo Nicolaci from Goldman Sachs.

Hugo Nicolaci: Congrats on the quarter and the first half. Just a couple of operational questions for me, if I can. Firstly, just on Nevada, the production improvements in the second quarter, looking promising, but the costs there obviously remaining high. How much of that is the ongoing production improvement works in fleet replacement versus just underlying cost pressures? And how confident do you remain in that full year cost guidance?

Thomas Ronald Palmer: I think when you think about Nevada, a couple of those questions are firmly for the operator. So I don’t think it’s appropriate that we give that level of granularity. And we also haven’t had our Board meeting for this quarter yet. So Natascha, Francois and I will all be in Nevada next week with the team there, and we’ll have a Board meeting and visit a couple of the operations and start to unpack in a bit more detail, second quarter performance with the team and also discuss the views and approach for the second half of the year and how opportunities are gone after and risks managed. So if it’s okay, Hugo, I think that’s probably a question best asked of the operator when they report their results in a couple of weeks’ time.

Hugo Nicolaci: Fair enough, Tom. And then maybe on one that is yours — at Boddington, it looks like the mill ran above nameplate capacity in the quarter for the first time in about 4 years. Are you able to talk us through the productivity improvements there and how sustainable you think that is going forward and sort of holding that nameplate capacity?

Thomas Ronald Palmer: Very observant, Hugo, but I’ll pass to Natascha to give her perspective on Boddington, maybe both mine and plant.

Natascha Viljoen: Yes. And I’ll definitely do that. So Hugo, let’s start with the mine. You would remember, just as we started to go through COVID, we rolled out an autonomous haul fleet at Boddington. And it has been a continuous learning journey for us on reestablishing and redesigning an existing mining operation to be appropriate for an autonomous hauling fleet. The team has really done an amazing work with our technical team with — under Francois’ leadership, considering mine design, road widths, the road layouts to be far more appropriate for an autonomous haul fleet. We have certainly take learnings from others on how to improve productivity. And we have seen a 10% uplift in productivity through that — with that autonomous haul fleet.

We see that at the moment, as we — as you might remember, we are still in a pushback campaign, and we see the benefits of us lifting just — the total materials movement has left materially year-on-year on the back of the productivity improvements we have not increased that fleet. So on the mining side, certainly, the team is doing a really good work. On the plant side, it’s all about asset management and reliability. It is closely related, though, to mining performance. It is closely related to fragmentation. So back to mining discipline, ensuring that the fragmentation from the mining side is appropriate for feed and then the work that the team has done on asset management and establishing that reliability levels that we need. So in both instances, [ it is a ] working on making sure that the basis is strong so that we can continue to benefit from the work that we’re doing.

Hugo Nicolaci: Natascha, so if I can just pick on that a little bit. So should we expect that plant to continue to run close to nameplate? And if the mine is slower to get access to ore, then you’ll draw down that, I think, 60 million tonne-plus of stockpile and continue to run close to that 10 million tonnes a quarter?

Natascha Viljoen: We continue to draw on the medium-term stockpiles. We’re still very much in a phase of pushback, and we will still be there for the next at least 12 months. So our focus here is to getting the pushbacks complete and making sure that we can adhere to the rates that we need to get that pushback done in time.

Operator: This concludes the question-and-answer session. I would like to turn the conference back over to Tom Palmer for closing remarks.

Thomas Ronald Palmer: Thank you, operator, and thank you, everyone, for taking the time to join our call today, and I appreciate your full range of questions. And please enjoy the rest of your day all or your evenings. Thanks, everyone.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines.