Newcrest output drops on Cadia hit
Newcrest Mining has posted a 2.4 per cent drop in full-year gold production driven by lower output at its Cadia mine in NSW, which was shut after an earthquake in April.
Australia's biggest gold miner says gold production in the year to June 30 fell to 2.38 million ounces, with its June quarter output sinking 7.8 per cent from the prior quarter, to 551,815 ounces.
Cadia - Newcrest's biggest and lowest-cost mine - was hit by a magnitude 4.3 earthquake in central west NSW in early April, prompting the suspension of operations.
Production has resumed in Cadia's panel cave 2, but repair work continues in panel cave 1, with production there expected to resume in the September quarter.
The company says the suspension of mining activities at Cadia had resulted in June quarter gold production at the mine more than halving from the March quarter level, to 76,552 ounces.
The output was achieved through a larger-than-expected stockpile drawdown, Morgans analyst Adrian Prendergast said, adding that a clearer picture of the longer-term implications for the mine were needed.
"We still hold some lingering doubts and expect the impacted performance stemming from the seismic event will drag on longer than 1Q18 (the first quarter of the 2018 financial year)," he said in a client note.
Newcrest expects Cadia's production in the September quarter to be higher than the June quarter, but still below the level of output prior to the April earthquake.
At 1045 AEST, Newcrest Mining shares were up 0.95 per cent at $19.76 each.
Back to Breaking News