Newmont Corporation · NYSE:NEM
Newmont — Investor Day (December 2020)
47 slides from Newmont's investor day presentation, Dec 8, 2020
Slide 1: 2021 Investor Update
2021 Investor Update CREATING VALUE & IMPROVING LIVES DECEMBER 8, 2020 THROUGH SUSTAINABLE AND RESPONSIBLE MINING 2021 INVESTOR UPDATE NEWMONT CORPORATION 1
Slide 2: Cautionary Statement
Cautionary Statement CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS: This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended
Slide 3: Tom Palmer, President & Chief Executive Officer
Tom Palmer PRESIDENT & CREATING VALUE & IMPROVING LIVES THROUGH SUSTAINABLE AND CHIEF EXECUTIVE OFFICER RESPONSIBLE MINING 2021 INVESTOR UPDATE NEWMONT CORPORATION 3
Slide 4: The Industry's Best Portfolio in Top-Tier Jurisdictions
The Industry’s Best Portfolio in Top-Tier Jurisdictions World’s Leading Gold Company Nine world-class assets in top-tier Musselwhite Jurisdictions* Industry’s largest gold reserves of Nevada Gold Mines*** Éléonore 96Moz and 63Moz in GEO reserves Turquoise Ridge/Twin Creeks Stable production of
Slide 5: Steady Long-Term Production with Improving Costs
Steady Long-Term Production with Improving Costs INDICATIVE 10-YEAR GOLD PRODUCTION PROFILE * (ATTRIBUTABLE MOZ PER YEAR) 9 Total GEOs ** 8 7 6 South America*** 5 Africa 4 Australia 3 2 North America*** 1 - 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 World’s leading gold company with ~8M GEOs
Slide 6: Creating Value and Improving Lives
Creating Value and Improving Lives 2020 HIGHLIGHTS Protecting the wellbeing of our Delivered superior operational Right-sized portfolio with nine workforce and communities execution from a proven world-class assets in top-tier throughout Covid response operating model jurisdictions Recognized as top
Slide 7: Foundation for 2021 and Longer-Term Outlook
Foundation for 2021 and Longer-Term Outlook Applying Newmont rigor and discipline Conservative $1,200/oz gold price assumption* Increasing production & improving costs through 2025 Tanami Expansion 2, Ahafo North and Yanacocha Sulfides included Musselwhite resumes full production Full Po
Slide 8: Applying Rigor and Discipline to Managing Covid-19
Applying Rigor and Discipline to Managing Covid-19 Overcoming challenges Wide-ranging controls Focused on community with agility and resolve continue across the business resiliency through partnerships Spotlight on Mexico 18 Testing centers 56 Nurses in-country Peñasquito >50k Tests performed Placin
Slide 9: Leading Approach to Climate Resiliency
Leading Approach to Climate Resiliency Climate Commitments by 2030* 1. Absolute Emissions: 30% reduction of combined emissions (Scope 1 & 2) 2. Emissions Intensity: 30% reduction of combined emissions intensity (Scope 1 & 2) 3. Scope 3 Emissions: 15% reduction from supply chain and partnerships 4. E
Slide 10: Directing $500M to Climate Initiatives over 5 Years
Directing $500M to Climate Initiatives over 5 Years Renewable energy Energy efficiency Fuel switching Carbon capture PATHWAYS TO LOWER CARBON FOOTPRINT INITIATIVES UNDER CONSIDERATION Funds directed to support 2030 climate targets and Solar and wind projects at Peñasquito, Ahafo, goal of net zer
Slide 11: Improving Margins and Investing in Our Future
Improving Margins and Investing in Our Future ATTRIBUTABLE PRODUCTION & AISC * (MOZ & $/OZ) 6.2 – 7.0 million ounces per year through 2025* * $1,500 8.0 Total GEOs Ahafo North and $1,300 Yanacocha Sulfides ramping up in 2024 7.0 AISC $1,100 Additional 1.2 – 1.6 million gold equivalent 6.0 ounc
Slide 12: Full Potential Demonstrates Newmont's Discipline
Full Potential Demonstrates Newmont’s Discipline >$3B OF VALUE DELIVERED SINCE 2014* 2020 PEÑASQUITO ACCOMPLISHMENTS Program engrained in Newmont's Delivered >$200M in Full Potential value over last 12 months operating model and culture Debottlenecked Augmented Feed Circuit Delivering >$300M
Slide 13: Project Pipeline to Sustain Production into 2040's
Project Pipeline to Sustain Production into 2040’s 7+ YEARS 4 TO 7 YEARS 0 TO 3 YEARS EXECUTION Yanacocha Sulfides Tanami Expansion 2 Australia – Gold Definitive Peru – Gold/Copper Feasibility Ahafo North Goldrush Declines Ghana – Gold (NGM JV) Pueblo Viejo Expansion JV USA – Gold Dominican Republic
Slide 14: World-Class Exploration in Top-Tier Jurisdictions
World-Class Exploration in Top-Tier Jurisdictions Exploration Investment** Coffee Galore Creek 20% Musselwhite Éléonore $250M Japan Porcupine in 2021 Nevada Gold Mines* CC&V 80% Peñasquito Mexico Ethiopia Merian Espérance Akyem Ahafo Yanacocha Tanami Andes Centralian LEGEND Boddington Lachlan LEGEND
Slide 15: Robust Near-Mine Exploration Opportunities
Robust Near-Mine Exploration Opportunities NORTH AMERICA Peñasquito: Large resource base and prospective land package with potential to extend mine life to 2040 Éléonore: New district targets for 2021 with <20% property drill tested to date CC&V Underground: Significant potential to extend mine life
Slide 16: Rob Atkinson, Chief Operating Officer
Rob Atkinson CREATING VALUE & IMPROVING LIVES CHIEF OPERATING OFFICER THROUGH SUSTAINABLE AND RESPONSIBLE MINING 2021 INVESTOR UPDATE NEWMONT CORPORATION 16
Slide 17: Well-Positioned with Industry-Leading Portfolio
Well-Positioned with Industry-Leading Portfolio AUSTRALIA NORTH AMERICA SOUTH AMERICA AFRICA NEVADA GOLD MINES Growing Margins & Unlocking Value Investing in Future Growth Investment to Deliver Record (38.5%) Production Performance Boddington sustains strong Peñasquito delivers Cerro Negro imp
Slide 18: Australia Growing Margins and Production
Australia Growing Margins and Production ATTRIBUTABLE PRODUCTION & GOLD AISC * OUTLOOK (KOZ & $/OZ) Boddington sustains improved mill throughput (40.5Mtpa); accessing 2,000 higher gold and copper grades in $1,600 South Pit 1,600 Autonomous Haulage to reach 1,400 - 1,500 1,400 - 1,500 commercial
Slide 19: Tanami Growing Position as a World-Class Asset
Tanami Growing Position as a World-Class Asset OPERATIONAL EFFICIENCY IMPROVES MARGINS TANAMI EXPANSION 2 BUILDING ON SOLID BASE Replicating successes & leveraging best practices Supports Tanami’s future as a long-life, low-cost producer Optimized mine plans, improved throughput & recovery E
Slide 20: North America Unlocking Value
North America Unlocking Value ATTRIBUTABLE PRODUCTION & GOLD AISC OUTLOOK Peñasquito delivers higher gold (KOZ & $/OZ) grade & Full Potential improvements 3,000 $1,600 in 2021; stripping in Chile Colorado in 2022 produces higher silver & lead in 2023 2,400 $1,400 Musselwhite ramping up to full p
Slide 21: South America Investing in Future Growth
South America Investing in Future Growth ATTRIBUTABLE PRODUCTION * & GOLD AISC OUTLOOK (KOZ & $/OZ) Cerro Negro delivering Full Potential mine productivity improvements $1,500 including higher development rates 1,200 1,050 - 1,150 Cerro Negro primarily mining from 1,135 1,075 1,000 - 1,100 $1,20
Slide 22: Yanacocha Sulfides Advances Towards 2021 Approval
Yanacocha Sulfides Advances Towards 2021 Approval INDICATIVE YANACOCHA PRODUCTION PROFILE * First phase focuses on Yanacocha (GEO ** KOZS, 100%) Verde and Chaquicocha deposits to profitably extend Yanacocha 800 operations beyond 2040 700 Decision to proceed expected in 600 2021 with three year d
Slide 23: Africa Investment to Deliver Record Performance
Africa Investment to Deliver Record Performance ATTRIBUTABLE PRODUCTION & GOLD AISC OUTLOOK (KOZ & $/OZ) Akyem delivering higher production & improved costs in 2021 ahead of $1,500 stripping campaign in 2022 1,200 1,100 - 1,200 Akyem improves value with 1,000 – 1,100 $1,200 additional layback to
Slide 24: Ahafo North – Best Unmined Deposit in West Africa
Ahafo North – Best Unmined Deposit in West Africa INDICATIVE AHAFO NORTH PRODUCTION PROFILE (KOZS) Open pit mine, stand-alone mill for processing 3.5Mozs of Reserve and 1.0Mozs of Resource* 1,600 Full funds decision expected 2021 1,400 Investment of $700-$800M with 1,200 three year development
Slide 25: Nevada Gold Mines (38.5%)
Nevada Gold Mines (38.5%) ATTRIBUTABLE PRODUCTION & GOLD AISC OUTLOOK (KOZ & $/OZ) 1,600 $1,500 1,300 - 1,400 1,375 1,370 $1,200 1,200 - 1,300 1,200 $960 $900 $900 - $1,000 $880 $850 - $950 800 $600 400 $300 0 $0 2020E 2021E 2022E 2023E Attributable Production Range AISC 2021 INVESTOR UPDATE NEWMONT
Slide 26: Nancy Buese, Chief Financial Officer
Nancy Buese CREATING VALUE & IMPROVING LIVES CHIEF FINANCIAL OFFICER THROUGH SUSTAINABLE AND RESPONSIBLE MINING 2021 INVESTOR UPDATE NEWMONT CORPORATION 26
Slide 27: Investing in Our Future and Reducing Support Costs
Investing in Our Future and Reducing Support Costs Consolidated capital & expense outlook (+/-5%) 2020E 2021E Sustaining Capital ($M) 900 1,000 Development Capital ($M) 475 900 Exploration & Advanced Projects ($M) 350 390 G&A ($M) 265 260 Interest expense ($M) 300 275 DD&A ($M) 2,250 2,500 Adjusted
Slide 28: Superior Free Cash Flow Generation Across Cycles
Superior Free Cash Flow Generation Across Cycles ATTRIBUTABLE FREE CASH FLOW INCREASES WITH HIGHER GOLD PRICE* (INCREMENTAL FROM $1,200 BASE) ~$21.5B +$3,600M ~$15.5B +$2,400M ~$9.5B +$1,200M ~$3.5B (+171%) (+343%) (+514%) $1,200 $1,500 $1,800 $2,100 5 Year Cumulative Attributable Free Cash Flow** *
Slide 29: Disciplined Capital Allocation Priorities
Disciplined Capital Allocation Priorities RESILIENT AND FLEXIBLE CAPITAL STRUCTURE ACROSS CYCLES INVESTING IN RETURNING CASH MAINTAINING ORGANIC GROWTH TO SHAREHOLDERS FINANCIAL FLEXIBILITY Sustaining capital of ~$1B per year Industry-leading dividend and Liquidity of $7.8B and cash position f
Slide 30: Industry-leading Dividend Framework
Industry-leading Dividend Framework Leading $1.00/share sustainable base dividend ANNUALIZED DIVIDEND PAYOUT Targeting 40% – 60% of incremental attributable Free $2.80 - $3.70 Cash Flow above $1,200/oz returned to shareholders Evaluating gold price increments of approximately $300/oz $2.20 - $
Slide 31: Tom Palmer, President & Chief Executive Officer
Tom Palmer CREATING VALUE & IMPROVING LIVES PRESIDENT & CHIEF EXECUTIVE OFFICER THROUGH SUSTAINABLE AND RESPONSIBLE MINING 2021 INVESTOR UPDATE NEWMONT CORPORATION 31
Slide 32: The World's Leading Gold Company
The World’s Leading Gold Company #1 gold producer with ~8M GEOs/yr through 2030 and significant exposure to other metals Industry’s best portfolio of world-class assets in top-tier jurisdictions Recognized sustainability leader committed to creating value and improving lives Proven operating mod
Slide 33: Questions
Questions 2021 INVESTOR UPDATE NEWMONT CORPORATION 33
Slide 34: Free Cash Flow Sensitivities
Free Cash Flow Sensitivities* FCF Price Change Attributable FCF ($M) ($M) Gold ($/oz) $1,200 +$100 +$415 +$400 Australian Dollar $0.75 -$0.05 +$45 +$45 Canadian Dollar $0.77 -$0.05 +$30 +$30 Zinc ($/lb) $1.05 +$0.10 +$30 +$30 Oil ($/bbl) $50 -$10 +$20 +$15 Silver ($/oz) $22.00 +$1.00 +$15 +$15 Lead
Slide 35: 2021 Regional Guidance
2021 Regional Guidance Attributable Attributable * 2021 Outlook metric Attributable CAS AISC sustaining development ** (+/- 5%) production (Moz) ($/oz) ($/oz) capital capital ($M) ($M) North America 1.76 $730 $915 $300 $25 South America 1.08 $850 $1,035 $100 $150 Australia 1.33 $650 $860 $235 $400 A
Slide 36: Five Year Cost and Production Outlook
Five Year Cost and Production Outlook Guidance metric (+/- 5%) 2021E 2022E 2023E 2024E 2025E * Gold production (Mozs) 6.5 6.2 – 6.7 6.2 – 6.7 6.5 – 7.0 6.5 – 7.0 ** Other metal production (Mozs) 1.3 1.2 – 1.4 1.4 – 1.6 1.4 – 1.6 1.4 – 1.6 Total GEO production (Mozs) 7.8 7.5 – 8.0 7.7 – 8.2 8.0 – 8.5
Slide 37: 2021 Outlook by Region
2021 Outlooka by Region Consolidated Consolidated Attributable Attributable Consolidated All- Sustaining Development Sustaining Development Consolidated Attributable in Sustaining Capital Capital Capital Capital b 2021 Outlook +/- 5% Production Production Consolidated CAS Costs Expenditures Expendit
Slide 38: 2021 Site Outlook as of December 8, 2020
2021 Site Outlooka as of December 8, 2020 Consolidated Consolidated a) 2021 outlook projections shown above are considered forward-looking statements and represent Consolidated All- Sustaining Development management’s good faith estimates or expectations of future production results as of December 8
Slide 39: Longer-term Outlook
Longer-term Outlooka Outlook 2021E (+/- 5%) 2022E 2023E 2024E 2025E Attributable Production (koz) 6,500 6,200 - 6,700 6,200 - 6,700 6,500 - 7,000 6,500 - 7,000 Attributable Co-products (GEOs Koz) 1,300 1,200 - 1,400 1,400 - 1,600 1,400 - 1,600 1,400 - 1,600 Consolidated Gold CAS ($/oz) 750 650 - 750
Slide 40: All-in Sustaining Costs
All-in Sustaining Costs Newmont has developed a metric that expands on GAAP measures, such as cost of goods sold, and non-GAAP measures, such as costs applicable to sales per ounce, to provide visibility into the economics of our mining operations related to expenditures, operating performance and t
Slide 41: Free Cash Flow
Free Cash Flow Management uses Free Cash Flow as a non-GAAP measure to analyze cash flows generated from operations. Free Cash Flow is Net cash provided by (used in) operating activities less Net cash provided by (used in) operating activities of discontinued operations less Additions to property, p
Slide 42: Attributable Free Cash Flow
Attributable Free Cash Flow Management uses Attributable Free Cash Flow as a non-GAAP measure to analyze cash flows generated from operations that are attributable to the Company. Attributable Free Cash Flow is Net cash provided by (used in) operating activities after deducting net cash flows from o
Slide 43: Net Debt to Adjusted EBITDA Ratio
Net Debt to Adjusted EBITDA Ratio Management uses net debt to Adjusted EBITDA as non-GAAP measures to evaluate the Company’s operating performance, including our ability to generate earnings sufficient to service our debt. Net debt to Adjusted EBITDA represents the ratio of the Company’s debt, net o
Slide 44: Gold All-in Sustaining Costs – 2021 Outlook
Gold All-in Sustaining Costs – 2021 Outlook A reconciliation of the 2021 Gold AISC outlook to the 2021 Gold CAS outlook is provided below. The estimates in the table below are considered “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Sec
Slide 45: Co-Product All-in Sustaining Costs – 2021 Outlook
Co-Product All-in Sustaining Costs – 2021 Outlook A reconciliation of the 2021 Co-products AISC outlook to the 2021 Co-Products CAS outlook is provided below. The estimates in the table below are considered “forward-looking statements” within the 27A of the Securities Act of 1933, as amended, and Se
Slide 46: Endnotes
Endnotes Investors are encouraged to read the information contained in this presentation in conjunction with the most recent Form 10-Q for the quarter ended September 30, 2020, and with the Cautionary Statement on slide 2 and the following notes below Outlook Assumptions. Outlook and projections use
Slide 47: Endnotes
Endnotes Free Cash Flow. FCF or Free cash flow are used herein is a forward-looking statement and is subject to risks and uncertainties. FCF is a non-GAAP metric and is generated from Net cash provided from operating activities of continuing operations less Additions to property, plant and mine deve