Gold Miner Newmont's Third-Quarter Profit Falls

Newmont Mining Corp said on Wednesday that third-quarter profit fell just over 50%, hurt by a decline in gold and copper shipment volumes and higher production costs.

Net income dropped to $196m, or 43¢ a share, from $397m, or 88¢ a share, a year earlier, the Denver-based miner said.

Income from continuing operations fell to 39¢ a share from 73¢.

Revenue was down 13.9% at $1.39bn.

Gold and other mining companies have felt the effects of the recent financial market turmoil and fears of a global recession. Lower gold and copper prices, in conjunction with higher raw material and energy costs, have raised the cost of production, squeezing profit margins.

Last week, the price of gold, traditionally a safe haven in times of economic uncertainty, fell below $700 per ounce for the first time in more than a year.

Newmont, the world's second-largest gold miner, said last month that cost pressures were constraining development of its Boddington project in Western Australia. The company has said it expected to start the mine in early to mid-2009, with initial five-year average annual equity production of between 600,000 and 700,000 ounces of gold.

Earlier this month, Citigroup cut Newmont's share price target to $50 from $65. The stock, which was trading at a 52-week high of $57.55 on 15 January, hit a low of $21.40 on Monday.

Reporting by Euan Rocha and Steve James, Reuters.