Newmont Mining Corp (NYSE:NEM) has had an amazing 1Q2015, despite the fact that other miners have been suffering the losses of falling gold prices. The company now aims to make use of its strong financial position to acquire two additional mines from AngloGold Ashanti. The two mines are namely Cripple Creek and Victor Mine, located in Colorado.
The CC&V mine, as it is commonly known, is an open pit mine, which employs 522 workers and recorded around 231,000 O.Z. of gold production and approx. 103,000 O.Z. of silver production in 2015. The mines had recently acquired a new mill, worth $100 million, in January 2015. The operation is considered to be a low-grade mining operation, but mining at current rates is expected to continue till 2025.
AngloGold Ashanti is selling the CC&V mines along with two others in Mali, Africa, to reduce its net debt. Its FY2014 had indicated the debt to be standing at $3.133 billion. Newmont, on the other hand, has reported its 1Q2015, with revenues of $1.97 billion, which beat the estimates of $1.95 billion. The company had also reported $0.46 EPS, twice the amount of the analyst estimates. These figures have been quite encouraging for Newmont, which now plans to increase its production.
The company already has a number of projects lined up for completion in 2015, but acquiring a few productive mines is also on the agenda. Newmont has not been as productive as it should have been, due to falling gold prices, but is still doing a lot better than other miners in North America. Additionally, the current strategy of the company is to make it much more profitable in the long run. The gold prices are expected to soar once again soon, which will ensure that the company’s value accelerates beyond expectations.
Newmont Mining Corp (NYSE:NEM) closed at $24.98 after gaining 6.52% on April 24. The company is trading 498.86 million shares in the market, with a 52-week range of $17.60-$27.40.
