Dallas, Texas 02/28/2014 (FINANCIALSTRENDS) – Colorado-based Newmont Mining Corporation (NYSE:NEM) has Gold and Copper as its core commodities. It is one of the world’s largest producers of gold and only gold company included in the S&P 500 Index and Fortune 500. Due to volatile market and the slump in Gold prices, the company has reduced its gold reserves by 11%. It is now planning to cut down the staff size by 1.5%. This is part of the measures to adjust expenditures related to ageing milling rate and align with the same. Currently, they have their footprints in seven countries and there are around 40,000 employees across all locations and the company plans to cut down the staff size by 500- 600.
Newmont Mining Corp Q4 Impacts Due To Slide in Gold Prices
Gold prices plummeted to double digit i.e. 28 percent due volatile market thus leading to weak pricing. Newmont Mining Corp (NYSE:NEM) fourth quarter net loss totaled to 1.26 billion dollars. The revenue decreased by 12 % to 2.2 billion dollars. In spite of challenges Newmont is showing remarkable progress with its growth projects and have recovered 4 percent so far this year; however production is effected by lower grades across specific mines. Also, Impacts are expected due higher mining and non- mining costs. The credit ratings of the company is now downgraded to “underperform” primarily due to unstable gold prices
Possible Impacted Location and Package Settlement
According to Newmont’s external director, the downsizing of the staff will happen mostly at Ahafo located in Ghana. Ahafo was impacted last year too as part of expenditure reduction exercise and around 240 employees were sent home as part of the exercise. Currently, the management is working on the packages for those affected and they are also negotiating with union leaders and respective government on reaching towards an agreement to take this forward.
