BHP warns Australian mining not ready for low-cost competitors
The boom in demand from China’s industrialization is now “past the period of aggressive growth,” BHP’s Australia President said.
Gold miner Newcrest Mining on Friday forecast lower output in fiscal 2021 due to issues in Papua New Guinea, as it posted a smaller-than-expected increase in annual profit.
Australia’s biggest gold producer forecast gold output to be between 1.95 million ounces and 2.15 million ounces next year, down from the 2.2 million ounces produced in 2020.
Newcrest has been entangled in a dispute between PNG’s national and provincial governments over any division of royalties for its major Wafi Golpu gold project.
The miner expects total capital expenditure for 2021 at between $1.06 billion and $1.24 billion
The company said it looks forward to re-engaging with PNG and progressing discussions to develop its delayed project.
However, a surge in gold prices driven by safe-haven demand during the coronavirus crisis helped the miner post a 15% jump in underlying profit to $647 million and hike its final dividend by 20%.
The profit came in 6% below analysts’ estimates of $689.77 million, according to Refinitiv data, as acquisition fees and an impairment on the divested Gosowong mine in Indonesia weighed.
The company said the cost impact of covid-19 is expected to be $30 million to $40 million, assuming no operational interruptions.
“The company increased stockpiled ore in case of supply chain impacts from covid-19,” Chief Financial Officer Gerard Bond said.
The miner expects total capital expenditure for 2021 at between $1.06 billion and $1.24 billion, much higher than its 2020 spend.
The Melbourne-based firm said total revenue climbed 7% to $3.92 billion for the full year and declared a final dividend of 17.5 cents per share.
(By A K Pranav; Editing by Shinjini Ganguli and Stephen Coates)
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