Newcrest shares up 3.2% to hit A$35.10

NEWCREST shares continued to be propelled higher following the announcement of a 50% hike in after tax profit for the six months to December, rising by A$1.09 or 3.2% yesterday to close at A$35.10.
Newcrest has been making steady gains since falling below A$30 in late December and the price surge last Friday and yesterday has brought it to its highest level since early December.
It had previously fallen from A$40 in late August.
The Melbourne-headquartered company was the fourth largest gold producer in the world in terms of market capitalisation.
 Its annual gold production of about 2.5 million ounces comes from mines in four countries, including its Lihir mine in Papua New Guinea and 50% of output from Hidden Valley in Morobe province.
Newcrest also has production of about 80,000 tonnes of copper a year and anticipates that corporate growth will amount to around 8% annually over the next five years.
Capital expenditure during the half year was largely focused on expansion of the Cadia East mine in New South Wales (A$615 million) and continuing work on the Lihir million ounce upgrade (A$220 million) with an additional A$20 million spent at Wafi-Golpu.
The Lihir plant upgrade is expected to be completed at a cost of US$1.3 billion by the end of this year, raising production by 200,000 to 300,000 ounces annually to bring total mine output past the million ounce level.
The Lihir expansion is now about 70% complete, according to Newcrest.
The company’s Cadia East expansion is also about 70% complete and involves a total project cost of US$1.9 billion.

 When completed late this year it would deliver 700,000 ounces of gold and 80,000 tonnes of copper.
In the six months to December Newcrest spent A$66m on exploration with the biggest chunk, amounting to A$24 million, spent on projects in PNG.
Australia was the second most-active exploration zone for Newcrest (A$18m) followed by Indonesia (A$12m), Cote De Ivoiry (A$9m) and Fiji (A$3m).