Newcrest Mining’s FY18 earnings outpaced the broker by 10%, although production and cost guidance disappointed. Cash flow met guidance.
Macquarie downgrades FY19 gold and copper production forecasts by -2% and -5% and raises AISC forecast 7%. Updated guidance on grades at Cadia and Telfer triggered a -5% cut to the FY20 gold and copper forecasts.
The broker reduces FY19 and FY20 earnings forecasts by -14% and -26%, while FY21 and FY22 fall -2% and -27%.
Price target falls to $18 from $20 and Underperform rating retained.
Target price is $18.00.Current Price is $20.25. Difference: ($2.25) – (brackets indicate current price is over target). If NCM meets the Macquarie target it will return approximately -12% (excluding dividends, fees and charges – negative figures indicate an expected loss).