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Operator: Good morning and welcome to Newmont’s First Quarter 2024 Earnings Call. All participants will be in listen only mode. [Operator Instructions] Please note the event is being recorded. I’d now like to turn the conference over to Tom Palmer, President and Chief Executive Officer. Please go ahead.

Thomas Palmer: Thank you, operator. Good morning, everyone and thank you for joining our call. Today, I’m joined by my executive leadership team, including Natascha Viljoen and Karyn Ovelmen and we’ll all be available to answer your questions at the end of the call. Can I please ask you to note our course free statement and refer to our SEC filings, which can be found on our website. Before we begin today, I’d like to take a moment to remember the three colleagues who sadly lost their lives working for Newmont this year. Mike Morrison or Colby, as he was known to his friends and colleagues, were the dedicated and hardworking member of our Half North project team and a Natural Leader. Colby was a son, a husband, a father, a dear friend to many and he’ll be greatly missed.

Rosanna Lestermar was a daughter, a wife and a mother to a young daughter, civil engineer. Rosanna was part of the original team that developed Cerro Negro 11 years ago and had aspirations to soon become a part-time farmer in Argentina. And Daniel Ochoa a son, a father to two young boys, a partner and a brother. He has been described by his colleagues as a strong team member with ambitions to further develop his career in mining. The investigations into these tragic incidents have been led by two of our Managing Directors from different business units, with the support of teams of subject matter experts to ensure that we truly understand the cause of the incidents. Our response will include implementing both immediate measures from early observations from the investigations as well as taking a structured approach to reinvigorate our safety systems, tools, and infield lift that will all have a heavy focus on the quality of application.

Sadly, these recent incidents are a stark reminder of the need to maintain discipline and a relentless focus on safety fundamentals. The loss of Adam Kennedy, Coby, Rosanna and Daniel over the past six months has had a profound impact on the entire Newmont family. And it is with great humility and resolve that will continue to challenge ourselves to ensure that everyone working in our business goes home safely to their loved ones. Turning to our quarterly results, we are firmly on track to deliver our 2024 guidance. We are pleased with our operational performance in the first quarter and remain focused on delivering consistent results as guided over the remainder of this year and beyond. I also want to reiterate the four key commitments that we have made to our shareholders.

We continue to make progress on these commitments, and I would like to provide a brief update on our first quarter achievements, starting with strengthening Newmont’s position as the gold industry’s recognized sustainability leader. Last week, Newmont published our 20 annual sustainability report, along with our third annual taxes and royalties contribution report, both providing a detailed and transparent look at our values driven approach to sustainability and the economic contributions we made in the jurisdictions and communities that we operate in. With this sustainable foundation in place, we have created the industry’s strongest portfolio of world-class gold and copper assets in the most favorable mining jurisdictions. And from this portfolio, we produced 1.7 million ounces of gold at an all-in sustaining cost of $1,439 an ounce in the first quarter.

We continue to expect these unit costs to improve throughout the year, driven by both higher production in the second half and the delivery of synergies. I’d also note that in the first quarter, our go forward Tier 1 portfolio produced 1.4 million ounces of gold at $1,378 an ounce. Our Tier 1 portfolio also produced over 480,000 gold equivalent ounces from copper, silver lead and zinc. And included in this number is 35,000 tons of copper that we produced and sold. We generated $776 million of cash flow from operating activities in Q1, including a $666 million reduction from working capital, which Karyn will cover in a few minutes.

Q – Unidentified Analyst : That’s very helpful. And then just finally on operations, and I’ll leave it for someone else to ask, I’m just interested in, as the costs were quite good in Q1, even with the lower production level that you are going to expect better production going through the year. Anything on the inflationary front that you could flag for us, any easing that you’re seeing, anything that you are seeing some benefits on?

Karyn Ovelmen: We’ve certainly seen some easing in three areas. We’ve seen it in contractor across diesel and explosives. But then we’ve also seen some increase in our steel wall cost related to steel price and then also cyanide cost. The other factor would probably energy in certain areas we see a reduction in energy. That is, I think, quite surprising for us from 2023.

Thomas Palmer: And just remind us about half of our direct cost is labor and that’s been pretty flat.

Unidentified Analyst: Just so that I understood, because it faded in and out and I apologize for that. Just on where you’re seeing reductions or easing as in contractor cost diesel and some consumables and energy. Is that a correct statement?

Karyn Ovelmen: Explosive specifically.

Unidentified Analyst: And then overall labor cost staying floods for own labor. That’s about 50% of our cost makeup.

Operator: Our next question comes from Josh Wolfson of RBC Capital Markets.

Joshua Wolfson : The team has painted a fairly rosy picture here on what the prospects are for asset dispositions, and then also what the free cash flow outlook would look like absent some of these working capital headwinds. In that context, I’m wondering how flexible is the company’s buyback policy? And I’m noticing the stock being a lot higher today than it was when the plans were announced for this at the fourth quarter results.

Karyn Ovelmen: As we go through the divestitures and as I’ve indicated as our free cash flow picks up in the second half of the year. First priority is to ensure that we’ve got that our cash replenished on our balance sheet. And then there will be flexibility in terms of as long as we have line of sight in terms of that debt reduction over the next 24 months, we would — at that point in time, if we were in a position start to think about executing on share buybacks.

Thomas Palmer: And a reminder, Josh, we’ve got an approved $1 billion buyback program ready to go if or when that scenario, Karyn Ovelmen said out takes place.

Joshua Wolfson : And then just sort of to clarify, when I look at even what a flat quarter would look like at much higher gold prices today, and again without this, some of the larger working capital challenges, even maybe one or two of these asset dispositions would put you in line of sight of that. Is it fair to say that the prospects for the buyback could happen sooner than maybe what the initial criteria were outlined for the balance sheet requirements?

Karyn Ovelmen: Expectations for the divestitures is that those will be executed within the next 12 months. Hence, the classification on the balance sheet is assets held for sale. So expectation is through first quarter of 2025 that we will have executed or made decisions around the divestitures. And so the timing is contingent upon that.

Joshua Wolfson : And then, sorry, just one question if I can sneak in. I noticed the book value for the assets that are held for sale is $5.7 billion, which is quite a large number as compared to the $2 billion targeted. Any sort of comments there on how we should think about pricing or what the targets are effectively?

Karyn Ovelmen : No, not necessarily. I think from an accounting convention perspective and how they’re reported from a GAAP perspective will be obviously considered, I would assume by potential buyers. But in essence, the process of going through the commercial view of the assets and the value to the potential buyers that will produce something most likely different whether it’s up or down inefficient versus what is recorded on our book from a GAAP perspective.

Operator: Our next question comes from Jackie Przybylowski of BMO Capital Markets.

Jackie Przybylowski : Maybe I’ll ask the first question on the full potential program. I had the privilege of visiting Penasquito in March, and definitely the team did a great job of outlining how the full potential program has benefited there. I know you’re working very hard on rolling that out in some of the newer acquired assets, like Lihir. Can you talk a little bit about how that’s going so far and what you’re seeing in terms of achievements or maybe potential for future achievements?

Thomas Palmer : I’ll kick off and Natascha, if you might want to build on that. Dean Gehring in the room as well, may want to chip in as well. We are further most advanced at here and Lihir was the site we saw as the most opportunity, which is why we jumped into there, literally on day one. Three main productivity and cost opportunities that live here. The one I mentioned in the prepared remarks is really around consistent fourth feed, so that you can manage and address materials handling. So ensuring you’ve got the right balance of different orders so that you’ve got managing conveyor belts and block shoots and block crushes just allowing a big plant to get a good consistent feed coming into it is a key value driver. Asset management and improving plant availability and other plant losses, a real opportunity at Lihir, just the basics of good quality work management, reliability, engineering with the strength of the team that we have to support Lihir.

And then the third one is down into the pit and improving mine efficiency and mine productivity. Just getting back to the basics of drill and blast load haul through the mine. Very similar as we discussed at Penasquito in late February. Move across to — maybe just to touch on Cadia and Red Chris in particular. There’s an enabler at Cadia, really important enabler in terms of resolving the tailings constraints. So understanding the work to rectify the tailings at Cadia and then expand those tailings to ensure you’ve got the tailings capacity support productivity improvements from both mine and the processing plant. Underground, it’s unlocking panel development. We’re clearly opening up PC2-3, so progressing the opening up of the draw points over the next couple of years in PC2-3, ensuring that you’re bringing on the development work for PC1-2, and then it’s a fine balance between the mine and the processing plant.

So ensuring that as we’re doing that work, we’re also unlocking a processing capability. We’re still in that first phase of full potential but we do identify some early quick wins. And I would argue that we are specialists in high pressure grinding roles at Boddington. Over the last dozen years, we have worked with those HPGRs and we have a very efficient way of operating and maintaining those that important crushing circuit such that we have regular visits to Boddington to understand how we both operate and maintain those HPGRs. So the opportunity for us to quickly get across to the HPGRs, Acadia, understand the power draw, understand the process, control logic, and optimize those HPGRs a really fairly quick win that we’re getting after, even before we finish the diagnostic phase.

And then I’ll maybe touch on Red Chris, that processing plant is going to be there through the end of the open pit mine and as we ultimately move into the blockade. So really focusing on the opportunities to stabilize mill operations. Again, the basics around reliability and having uptime of that facility with consistent feed. Then after you’re stabilized, then optimizing copper and gold recoveries and improving process controls so that you have a builders performing very well for the remaining life of the open pit as you then bring on the ore from the block caving future years. Natascha anything you add?

Natascha Viljoen : No, I think that was a really comprehensive answer. Thanks, Tom.

Thomas Palmer: Hopefully, Jackie, that gives you some sense of the excitement we have seeing you behind full potential and the confidence we have in that run rate through to the end of this year, the run rate to the end of next year and while we’ve gone after the upside on top of that $500 million.

Jackie Przybylowski : And maybe if I can ask as a second question, just going back to your divestment strategy, I know you have a number of assets that you’re looking to sell in Canada specifically but also, I guess globally as well. Can you comment at all, like, is do you have a preference of selling that’s in sort of groups or bundles? Or are they all expected to be sold individually to different buyers? I mean, I don’t know if you can make any comments on how you’re thinking about that?

Thomas Palmer: As I mentioned, in the — asked earlier question, the process has started on all six assets. We have engaged banks and have started a process on all six assets, and we’re in the process of price discovery through a Phase 1, and active interest. So we are getting a good feel for the level of interest in these assets and the competitive environment that we’re hoping to enjoy. And we’re running three separate processes in terms of, because they’re in different locations. There’s a set a process for Telfer in the Australian context with a dedicated team looking after that. There’s a process for Akyem in the African or Ghanaian context with a separate team looking after that. And there’s a process for our North American assets, the four operations plus the coffee project, and a team getting after that for being led by Peter Toth that’s Scott Langley.

But up and running and very active, as I say, we’re in Phase 1, and quite excited about the level of interest and the competitive environment, which we are presenting these assets to prospective buyers.

Operator: Our next question comes from Mike Parkin of National Bank.

Mike Parkin : Just looking for a bit of additional color with Yanacocha and the water treatment plants. This might be a bit old, but just looking for what’s the main driver there doing the two new plants versus the five existing one? Is it capacity or just the old ones don’t have the technology kind of need to have implemented there?

Thomas Palmer: It is both capacity and technology just to paint a picture for you we’ve been operating and mining the oxide ore at Yanacocha for the better part of the last 30 years, and disturbed at the top of the Andes an area that is equivalent of three quarters of Manhattan. So to give you a sense at the scale of the disturbed land at the top of the Andes, a significant rainfall every year and a watershed rate into both the Atlantic and the Pacific oceans. There is a significant amount of disturbed land for a significant amount of water at the top of the Andes. And that water is acidic. So if every drop of water that touched that disturbed land, we need to capture, process, treat and then discharge to different qualities.

Some instances the discharge needs to be to drinking water quality and some instances to agricultural standards as defined by the permits we have from the regulatory authorities in Peru. So as has been accrued for within our closure liability, we have been moving into the stage of closure for Yanacocha that involves the construction of two large water treatment plants over the next few years that then will treat water in perpetuity for the forever. These plants are designed to be there processing water and discharging water forever. We’re in the building of the plant phase now for a set of facilities that will operate for literally decades out in front of us. Just to put into perspective size of these water treatment plants. We are treating — we are designing and building these plants to treat 8,000 meters cubed per hour.

That is a plant equivalent to treating the water required by a city the size of Seattle. So that’s the size of the water treatment plants we’re building up in Yanacocha.

Mike Parkin : And the cost of those, I get that’s all kind of flowing through this year, next year. Is that in your capital budget or is that running through the income statement, like you normally have?

Thomas Palmer : Sorry, Mike. Karyn might want to build on this. You don’t [inaudible] capital or a sustaining capital?

Karyn Ovelmen : That’s correct. It’s accrued on our balance sheet as a liability and you’ll see that the $600 million that we expect to spend in 2024 is considered a current liability. But that you will not see that as Tom indicated flowing through sustaining or development capital.

Mike Parkin : Is it more working capital changes as the current liability?

Karyn Ovelmen : Yes. Consistent with first quarter, you’ll see that flow through working capital.

Operator: Our next question comes from Anita Soni of CIBC.

Anita Soni : Just a little bit of a follow on to what Mike’s just asked. So with Yanacocha, originally you guys took a — you did a provision of about $2 billion and it was basically the cost of treating this water in perpetuity. At least that’s what we understood or what you had previous that you previously talked about. Do we still have those costs as well or is this like, once you’ve built this plant you wouldn’t have ongoing expenses in terms of the water treatment plant? Like, I’m not quite sure if this is now additive to the original $2 billion?

Thomas Palmer: In either terms of the provisions that we have had in our closure liabilities, that’s all been there. There’s no new information there that’s fully accounted for in terms of our closure liabilities for Yanacocha and it’s part of that, there’s spend to build the water treatment plans, which takes place over ‘24, ‘25, ‘26, and then the cost to operate those water treatment plants. So you’re then looking at around $40 million, $50 million a year to operate those water treatment plants in perpetuity, the cost to both operate those plants and to construct those plans are included in our closure liability.

Anita Soni : What’s that total closure liability now then?

Thomas Palmer: Well Yanacocha is sitting at just looking at my number it is sitting at about $4.8 billion. But in the — sorry, the liability I’ll pass across to Karyn to cover the liability rather than me trying battle with balance sheets.

Karyn Ovelmen : Thomas is referring to the total reclamation and remediation liabilities is around $6.6 billion. But for Yanacocha it is the $1.7 billion, that’s in — that it has been accrued for on our balance sheet.

Anita Soni : Sorry, $1.7 billion?

Thomas Palmer: Yes. For the water treatment plan, Anita this Yanacocha has a bunch of other closure activities. You’ve got to reshape leach pads and waste jumps and tailings facilities. So water treatment plan is a component of that the total closure liability for Yanacocha is $4.8 billion.

Anita Soni : And then you mentioned it’s taking place over ‘24, ‘25 and then ‘26. Can you tell us what the number that we would see in working capital outflow in ‘26 would be?

Karyn Ovelmen : As I indicated, in my prepared mark, so $600 million in terms of ‘24, peaking at $700 million to 2025, and then starting to come down from there in 2026.

Operator: Our final question comes from Daniel Major of UBS.

Daniel Major : Two questions. One, just on following-up on the working capital and looking at your Slide 10 in the presentation, you’ve talked at length on the reclamation payments but can you give us a sense of any other key moving parts we should expect in the coming quarters and where you would expect the net balance change year-on-year to be from a cash working capital perspective, including the stamp duty or excluding it, whichever?

Karyn Ovelmen : The only additional stamp duty we’ll have is in the third quarter for approximately $30 million. You’ll see some additional seasonal changes as we head into second quarter as it relates to cash, taxes as well as interest from a cash perspective. Those will flow through in the second quarter as well. And you’ll see higher the reclamation liabilities, the cash outflow associated with that as we go through 2024. And then addition to that, you’ll see the traditional timing as it relates to sales and inventory changes as we go through the year.

Daniel Major : If you stand now, what would you expect the net change to be over the full year build in terms of total net build and working capital?

Karyn Ovelmen : Yes, that really depends on the timing in terms of that as well as of course pricing as we go through 2024.

Daniel Major : The second one, you’ve talked detailed a lot of the progress you’ve made since the integration in Newcrest. In these kinds of deals, I guess there’s always positives and negatives. What’s the toughest part? What’s been the most challenging or almost difficult part of the integration so far?

Thomas Palmer : I picked that one up. The thing by far away, Daniel, is that the tragic loss of Adam Kennedy’s life at Brucejack on the 20 of December last year. And as you reflect upon the integration, you reflect upon what things could we have done differently, what decisions could we have made differently that wouldn’t have led to Adam being killed that day at Brucejack. I think, as you’ve said in some of our remarks as well, I think stepping back from the loss of Adam and safety, I think the two areas that we are working through diligently tailing facilities, and we’ve talked about Telfer and we’ve talked about our Cadia and little bit around Red Chris. So just bringing those tailing facilities into the Newmont standard and ensuring that we have the appropriate rigor and discipline around those in managing them here and now, and ensuring those we shepherd those going forward that they have the appropriate standard.

And then the third one would be bringing the all body knowledge levels up to a Newmont’s standard so that we’ve got really robust all body knowledge underpinning our mine plans. So that will be the three areas where there’s been, I guess the hard work. I think if I step back from that with the perspective of having lived through a similar integration and transaction five years ago, I think, when I stepped back from those three areas, I think the integration has gone very well and I think we had the benefit of being able to apply the lessons we learned from integrating the five Goldcorp assets back in 2019 to this exercise. And that’s put us in good stead.

Operator: We had a follow-up question from Anita Soni of CIBC.

Anita Soni : Sorry, I got cut off there before the end of the question, but I was hoping — I’m assuming that the 2026 spend for Yanacocha water treatment would be $400 million, I think you said it was $1.7 billion just for the build-up of those plants. You are doing $600 million and then $700 million, so the remainder would be $400 million, is that correct?

Karyn Ovelmen : Yes, the expectation is that this will be commissioned in 2027, and there’ll be obviously some continued, as Tom said, continued approximately around $50 million a year associated with that going forward.

Thomas Palmer: We certainly see the step up through those three years. And then back to as best you can predict that far in the future, back to the sort of normal long run levels for closure and reclamation activities.

Anita Soni: I’m going to — so the second question that I wanted to ask was about Cerro Negro. So definitely unfortunate that two people lost their lives. I did want to ask a little bit about, does it have anything to do with long-term structural support there? I mean, these guys were or a gentleman and a lady were mine — within the mine technical services group, so a little bit unexpected for that to happen. So I was just trying to find out if you had any color on that.

Thomas Palmer: I might ask Natascha to comment.

Natascha Viljoen : Anita, absolutely not structural. From a geotechnical point of view and from a quality of asset point of view, very high quality and no material due tech challenges for us. This was procedural by nature. So definitely not linked to any long-term predictions.

Thomas Palmer: And as close out our investigation, we will share those lessons widely with the industry. As we’re up to, we will.

Operator: This concludes the question-and-answer session. I would like to turn the conference back over to Tom Palmer for closing remarks.

Thomas Palmer: Thank you, operator. Thank you all for your time and please enjoy the rest of your day. Thanks everyone.

Operator: The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.