Global gold mining leader Gold.com released its latest quarterly results before Monday's US market open, alongside announcing a significant agreement with fellow mining giant Newmont Mining regarding their large Nevada joint venture. This deal accelerates the path for the Canadian company to list its North American mining assets on the New York Stock Exchange through a final IPO.
Under the agreement announced Monday, Newmont Mining will pay Gold.com $1.95 billion. Simultaneously, both companies will contribute assets previously outside the joint venture, including Gold.com's Fourmile project and Newmont Mining's Fiberline and Mike gold development projects. Executives provided further details on the agreement during the subsequent analyst conference call.
Where to begin
Mark Hill, Group Chief Operating Officer, President, CEO, and Director, opened the discussion. Before sharing the full quarterly results, he wanted to address the agreement with Newmont Mining announced that day, aiming to clarify some misunderstandings. He stated the total value of the package is approximately $4 billion. This includes the proportionate share of the Fourmile project, but also the contribution of Newmont Mining's Mike and Fiberline assets, which Hill estimated at around 6.4 million ounces. Additionally, it covers the cost of resolving historical disputes and litigation between the joint venture partners. It also reduces the friction costs of the planned IPO, which will unlock greater value for shareholders than the cash consideration from the transaction itself. As stated, the majority of these proceeds will be returned to shareholders.
Hill noted that the agreement was reached after four months of negotiation. This allows the company to now focus on creating value through safe, stable gold production. The interests of the joint venture partners are now fully aligned, which is critical. He thanked his counterparts at Newmont Mining, Natascha, and the teams at both companies for their immense effort over the past four months.
Before moving to the results discussion, Hill highlighted several key strengths demonstrated by Gold.com over the past nine months. First, the leadership team has improved operational performance across the business over the past ten months, driven by the strength of site teams from general managers to frontline miners. Second, the strengthened relationship with Newmont Mining provides a solid foundation for further developing Nevada Gold Mines. Third, through the IPO, the company is building the only US-focused pure-play gold company with high-quality, long-life assets, which is precisely what investors, including some of the world's fastest-growing capital sources, are seeking. Fourth, outside North America, the Rest of World asset portfolio offers significant growth potential and unique advantages in partnering with Chinese counterparts, including co-ownership and co-investment in mines. This allows for improved efficiency, stronger supply chains, cost control, and reduced risk through partnerships.
Turning to the quarterly results, Hill reported a third consecutive quarter of strong operational and financial performance. All four priorities set at the beginning of the year were achieved. Safety performance continued to improve, although more work remains. Gold production was above guidance, and costs met guidance. Growth projects at Fourmile, Lumwana, and PV are progressing on time and on budget. The company continues to review the Reko Diq project, with a slowdown in development commencing on July 1st as previously disclosed. Strong production and cost performance also delivered robust financial results, which Helen will detail later. Finally, significant milestones were achieved in the preparation for the North American gold asset IPO, which is on track for completion before year-end.
On safety, Hill stated this remains the top priority, aiming for everyone to return home safely every day. The accident frequency rate decreased sequentially from 0.92 to 0.77. However, six lost-time injuries were still recorded, which is unacceptable, requiring continued focus on achieving zero harm. All leaders, including the executive committee and Hill himself, are spending more time on site, performing more critical control verifications, and eliminating risks. The company has invested over $90 million this year in safety-enhancing technologies, including automation of mining equipment, onboard cameras, safety reporting software, and AI analytics. Efforts are also underway to eliminate hazards through engineering design.
Why just 10 ASX 200 shares?
Hill provided highlights for the second quarter. Adjusted earnings per share were $0.82, in line with consensus expectations, clarifying that some media reports indicating a miss were incorrect. Gold.com produced 796,000 ounces of gold, 3% above guidance and 11% higher than the first quarter. Key drivers included advancing the Loulo-Gounkoto ramp-up plan, faster-than-expected recovery at PV after Q1 maintenance shutdowns, a record underground tonnage at Cortez, and continued ramp-up at Goldrush. Copper production was 56,000 tonnes. Costs were well controlled, with gold costs within guidance. Earnings nearly doubled year-over-year, and quarterly shareholder returns more than doubled to $1.5 billion.
Strong performance was evident across all regions. North America continued to support the world-class asset portfolio, with both NGM and PV achieving year-over-year revenue growth. Together, they contributed 53% of total attributable adjusted EBITDA with a 61% margin. The Rest of World region also delivered strong gold production with an attributable adjusted EBITDA margin of 59%. The copper business continues to perform well, with margins comparable to gold.
Regarding growth, Hill confirmed all projects are on track. At Fourmile, drilling activity has increased to 20 rigs, with a pre-feasibility study targeted for completion by the end of 2028. At Lumwana, good progress is being made on the mill expansion, which will double copper production. Capital expenditure for the project in 2026 is expected to be at the low end of the guidance range, and the project remains on budget, with first expanded copper expected by the end of Q1 2028. The PV expansion is also on schedule, with progress on permitting and construction for the tailings facility, haul road, and water treatment plant. 90% of resettlement packages have been accepted. The review of the Reko Diq project continues, with a decision not to start plant construction this year. Consequently, expected 2026 attributable capital expenditure for Reko Diq has been lowered from $600-700 million to $450-500 million, reducing the 2026 total group attributable capital expenditure guidance to $3.8-4.2 billion.
Returning to the North American asset IPO, Hill emphasized the entity will be a high-quality, pure-play gold company with assets in low-risk jurisdictions. The board has selected Hill to serve as CEO of the new company upon its formation. All operational and separation agreements between Gold.com and the new company have been completed, and the IPO is on track for year-end. The vast majority of net proceeds raised are expected to be returned to shareholders.
Financial performance review
Hongyu Cai, Senior Executive Vice President, Chief Financial Officer, and Non-Independent Director, reviewed the financial performance. The second quarter marked the third consecutive quarter of strong production, cost control, and financial results. Net profit was $1.2 billion, up 50% year-over-year. Adjusted net profit was $1.36 billion, or $0.82 per share, in line with Bloomberg consensus. Attributable adjusted EBITDA was $2.5 billion, up 51% year-over-year, with a margin of 59%.
Cai explained that Q2 is typically the lowest quarter for free cash flow due to the timing of annual tax and interest payments. This quarter also included a one-time $400 million payment related to Loulo-Gounkoto. These two factors combined resulted in a 33% year-over-year decline in attributable free cash flow. Excluding this factor, attributable free cash flow would have increased over 60% year-over-year. Year-to-date, attributable free cash flow has reached $1.4 billion, more than double the same period last year.
On the operational side, gold production increased 11% sequentially and exceeded guidance. The company continues to operate within its cost guidance, reflecting a strong focus on operational efficiency to offset fuel price pressures. At the end of Q2, the balance sheet was healthy with $1.2 billion in net cash, providing flexibility to continue investing in the highest-return opportunities and returning capital to shareholders.
Cai outlined the capital allocation framework with three priorities: first, prudent balance sheet management; second, investing in assets to drive earnings growth; and third, returning capital to shareholders. The framework is designed for sustainability across cycles. On the balance sheet, the company has ample liquidity, including a $3 billion undrawn revolving credit facility, with no significant debt maturities until 2033. Regarding the asset portfolio, Lumwana and Fourmile are clear examples of strategic capital deployment into organic growth opportunities expected to generate superior returns. More broadly, the company intends to identify similar profitable growth opportunities to strengthen its growth profile while maintaining discipline in how and when capital is deployed. Finally, the company is executing its capital return policy. The dividend policy provides for a base quarterly dividend of $0.175 per share, with an additional performance dividend at year-end, targeting a total payout ratio of 50% of attributable free cash flow. This quarter, the company also completed $1.2 billion in share buybacks under the $3 billion authorization announced in the previous quarter. Over the three quarters since the new leadership took office in October 2025, Gold.com has returned $3 billion to shareholders through dividends and buybacks, more than double the prior year period. Cai believes a carefully executed capital allocation strategy will further drive shareholder returns. In summary, the capital allocation framework is disciplined, flexible, and designed to work across the cycle. It supports reinvestment in the business, drives growth, protects the balance sheet, and creates a clear path for returning excess cash to shareholders.
Outlook and final remarks
Returning to the call, Mark Hill confirmed that 2026 production and cost guidance remains unchanged. For the third quarter, gold production is expected to be higher than Q2, in line with the plan, with Q4 production even higher. Copper production should also increase in the second half of the year relative to the first half. Since October 2025, the company has consistently achieved its strategic priorities and set new standards for operational performance. Hill congratulated the general managers and site employees. The company remains focused on controlling costs, capital intensity, and productivity. Based on current visibility, confidence remains high in achieving the full-year 2026 commitments.
Hill concluded by reiterating the importance of safety. Despite significant improvement, everyone remains focused on ensuring every employee returns home safely each day. Operational stability has improved, and guidance was again achieved. All projects are on time and on budget, a rare achievement in mining. The North American IPO is progressing. Overall, the company is executing on all four priorities set at the beginning of the year. The relationship with Newmont Mining has been changed, allowing the company to capture full value and expand NGM.
Analyst Q&A session highlights
Josh Wolfson from RBC asked for a more detailed breakdown of the values of the different components of the agreement, specifically the value of Mike and Fiberline within the $1.95 billion and the adjustment amount for resolving prior disputes. Mark Hill declined to provide a breakdown, stating the total value on the table was approximately $4 billion. He emphasized that since the agreement was reached, the focus would be on optimizing the structure of the IPO. Hill also highlighted the significant opportunities at NGM, noting aging infrastructure and the potential to add processing capacity to bring world-class assets like Fourmile into production sooner. The goal is to optimize NGM by potentially adding a roaster or autoclave, reducing ore haulage, and increasing total production. Following the resolution, Hill believes the company can add substantial value quickly without getting bogged down in resource allocation disputes.
In a follow-up, Wolfson asked if the company was considering a different percentage for the IPO stake, such as a larger minority stake than the previously considered 10-15%. Hill confirmed it would remain at 10%. Jorge Palmes added that the agreement with Newmont Mining provides flexibility and optionality to revisit the structure and understand the implications, as there is significant potential for savings.
Tanya Jakusconek from Scotiabank sought clarification on the total value of the package, asking if it was $4 billion or $6 billion. Hill confirmed it was $4 billion. Jakusconek then asked about the use of the cash and the remaining steps for the IPO. Jorge Palmes stated they are close but need to review the previous structure against the current one following the agreement with Newmont Mining to ensure proper due diligence.
Lawson Winder from Bank of America asked about the potential for accelerating the Fourmile project's development timeline now that it is in the JV. Hill confirmed the intention is to move as fast as possible, with a focus on the processing side. While the start of production may not be earlier, the goal is to achieve a faster ramp-up and higher production rates. Winder also asked about plans for the North American assets beyond the initial IPO. Hill stated there is no plan to IPO 100% of BNA; the plan remains a 10% IPO to demonstrate value and highlight the focused management team. A marketing process will be initiated, though the timeline is not yet set.
Anita Soni from CIBC asked about the capital expenditure for a new roaster or similar facility. Mark Hill estimated around $2.5 billion, noting it would offset other costs like hauling materials across the state. Wessel Hamman added that the Fourmile development, with a conceptual PEA range of $1.5-1.7 billion, is the other major capital project. Soni also requested the release of the Fourmile PEA to provide a better model for the project. Hill acknowledged her request and said he would take it back to see how to improve communication. On the value of Fiberline and Mike, Hill did not provide a breakdown, reiterating the total value of the package.
Daniel Major from UBS clarified the components of the $4 billion value. Hill explained it includes the value of Fourmile's 38% interest, minus the value of the 61.5% interest in Fiberline and Mike, plus amounts for resolving legacy disputes and benefits from reduced IPO friction costs. Major asked about the cost profile for Fourmile, and an executive responded that the $650-700 AISC range from the PEA was based on a gold price of over $2,500. With the current consensus gold price of $3,600, there is a sensitivity of roughly $100 for every $1,000 change in gold price, resulting in an adjusted AISC of $750-800. On the question of whether Newmont Mining benefited from assumptions about shifting other materials from the processing plant, Hill confirmed both technical teams had accounted for all factors. Regarding the CEO search for the parent company, Hill stated it is an ongoing process, and an update will be provided "soon."
Bennett Moore from JPMorgan asked about the Loulo-Gounkoto ramp-up plan and capital expenditure. George Joannou explained the project is now self-sustaining, with growth from the Baboto pushback and open pit expected to start in the first half of next year. Moore also asked about the conservatism in guidance. Hill stated it's not necessarily conservative, noting challenges like a weather event at Veladero and a dry Waile Creek dam at Porgera, which impacted production. He believes guidance is still achievable but not conservative. On NGM turnover, Hill reported it was at 14%.
Bob Brackett from Bernstein Research asked about asset portfolio management for the Rest of World business. Hill stated the Rest of World portfolio is actually one of the biggest growth areas, with significant potential around most operating sites. The plan is to grow this region. Brackett also asked if there were any contingent payments in the Newmont Mining agreement. Hill confirmed there were none.
Steven Green from TD Cowen asked about the permitting requirements for optimizing NGM and potentially accelerating Fourmile. Hill stated that understanding processing capabilities is key before starting the permitting process, which he is working to accelerate. He noted that the timing in Nevada might be favorable. On Fiberline and Mike, Hill confirmed the 6.4 million ounces but did not have a detailed breakdown of the resource classification. He described Fiberline as a satellite open pit deposit near Turquoise Ridge infrastructure, while Mike's valuation is currently limited.
Martin Pradier from Veritas Investment Research asked if the company considered floating 10% of the Rest of World assets. Hill stated this had never been discussed. Pradier also asked about the $400 million payment for Loulo-Gounkoto. Hongyu Cai explained it was for additional royalties, fines, and interest related to the retroactive application of the 2023 mining code for the 2024 and 2025 fiscal years. George Joannou added that the original agreement only covered up to 2023, necessitating a reconciliation with the government for subsequent years.
Lawson Winder returned to ask about the amended NGM JV agreement and whether it provides Newmont Mining with additional operational oversight. Hill stated that the agreement allows for information sharing and site visits, requires mutual consent for the appointment of the NGM general manager, and will likely involve embedding a Newmont Mining employee in the NGM executive team. On the CEO search for the parent company, Hill indicated a preference for an internal candidate, but the process is ongoing with both internal and external candidates under consideration.
A question was submitted via email asking whether the company would consider spinning off the North American business to existing shareholders rather than an IPO. Hill's response was simply "no."
Comments