(Reuters) -Newmont missed Wall Street estimates for second-quarter profit as lower production and higher costs hurt, sending shares of the world’s largest gold miner down nearly 5% in premarket trading on Thursday.
Since early June, Newmont’s operations at its Penasquito mine in Mexico has remained suspended in response to a labor strike notice, hurting output.
Newmont later last month told Reuters that it has declared a force majeure, unforeseeable circumstances that prevent from meeting contract obligations, on deliveries of some metal products from the Mexican mine.
The company withdrew its annual outlook for the mine on Thursday and said it could not estimate when the strike in the country would be resolved.
Wildfires in Quebec had also temporarily halted operations at its Eleonore mine in June.
Denver, Colorado-based Newmont said attributable gold production fell 17.3% to 1.24 million ounces in the quarter.
The company expects production to be higher in the second half of the year, with improving costs seen through the remainder of the year.
Its all-in sustaining cost (AISC) for gold, a key industry metric that reflects total expenses associated with production, rose nearly 23% to $1,472 per ounce in the quarter.
On an adjusted basis, Newmont posted a net income of 33 cents per share for the quarter ended June 30, compared with analysts’ average estimate of 44 cents per share, according to Refinitiv data.
Newmont, which is in the process of acquiring Australia’s Newcrest Mining, said it remains on track to achieve its full-year targets.
(Reporting by Sourasis Bose in Bengaluru; Editing by Savio D’Souza and Shilpi Majumdar)