THE Newcrest Mining Limited has announced its 2021 full year results capturing the different areas of record profit, free cash flow and increase in dividend for the last 12 months.
The report released on Thursday, August 19 highlighted the strong operating performance and higher prices translate to record profit and free cash flow as well as a strong balance sheet being well positioned for growth in the mining operation.
Newcrest Managing Director and Chief Executive Officer, Sandeep Biswas said Newcrest has delivered a strong operational and financial for the 2021 financial year, producing K2.1 million ounces of gold at an All-in sustaining Cost (AISC) of US $911 per ounce.
Together with the benefit of higher gold and copper prices, this translated into a record statutory and underlying profit of $1.2 billion and a record free cash flow of $1.1 billion.
The report also captured the advance multiple organic growth options and the sixth consecutive year of increased dividends by Newcrest.
The Newcrest Board has approved the Cadia PC1-2 Pre-Feasibility Study to the next stage. The study updates and defines a significant part of Cadia’s future mine plan.
The Board also approved the early works program to establish critical infrastructure in parallel with the feasibility study.
“PC1-2 has an attractive rate of return and is expected to help sustain Cadie’s position as a Tire 1, low cost producer for decades to come,” Mr. Biswas said.
Mr. Biswas noted that Newcrest’s strong financial position enables its investment in attractive growth projects.
“We have significant financial capacity to fund our pipeline of attractive organic growth options, both from the expected cash flow generation over the development period and our strong balance sheet,” he said.
On the increase of shareholder returns, Mr. Biswas said Newcrest dividends policy target total dividends for a financial year to be in the range of 30-60% of that financial year free cash flow, with a minimum annual dividend of US 15 cents per share.
Given the record, free cash flow generation for FY21, strong balance sheets and positive outlook the Board has approved a final dividend of US 40 cents per share, which is 129% higher than last year’s final dividend.
“This equates to a record total full year ‘s dividend of US 55 cents per share which represents a 41% payout of FY21’s free cash flow and marks our sixth consecutive era of increasing dividends to shareholders
“In the coming months we look forward to finalizing key Pre-Feasibility Studies for Red Chris, Havieron and Lihir.
“We are striving to bring Havieron and the Red Chris block cave into production as soon as possible .
“Phase 14a at Lihir represents further upside from the current mine plan and brings forward our aspiration for Lihir to be a 1 million once plus annual producer,” said Mr. Biswas.
Newcrest also embarks on creating a brighter future through safe and responsible mining as a core to how the business is run.
“We are now nearly six years free of fatalities and life-changing injuries and have reported a 12% improvement in injury rates compared to the prior year.
“Notwithstanding the challenges brought by COVID-19, our extensive precautionary measures and focus on safety has enabled us to achieve our full year guidance.
“We were also able to contribute our expertise to assist local governments and our host communities with their response to the virus,” Mr. Biswas stated.
In May 2021 Newcrest announced their goal or net zero carbon emissions by 2050.
Mr. Biswas said from then on have made solid progress implementing the sustainability objectives throughout the business and continue to target improvements in water usage, biodiversity and emissions reductions.