Newcrest flags Telfer gold mine sale

Newcrest Mining has flagged the potential sale of its Telfer mine in WA, which produces around 25 per cent of the company's gold.

Gold mining giant Newcrest is considering selling its Telfer mine in Western Australia, one of its main assets.

The country's largest gold miner is conducting a review that will look at a partial or full sale of Telfer, which accounts for around a quarter of the company's gold production.

"But no decision has been made at all and if it ever got to that it'd never be a fire sale," chief executive Sandeep Biswas told reporters on Friday.

Mr Biswas would not reveal whether the heavily indebted Newcrest had appointed an adviser as part of a sale process, and said the company had not been approached by potential buyers.

The review of Telfer is expected to be completed in October.

Newcrest also reported a small decline in half year underlying profit and again declined to pay a dividend.

A profit of $200 million in the six months to December 31 was down three per cent on an underlying profit of $207 million in the same period a year earlier.

But the result was a five-fold increase on the previous year's $40 million half year net profit, which included several one-off items.

Mr Biswas declined to commit to a time frame for the reintroduction of dividends, saying the company's priority was to reduce debt, which has been lowered by $220 million.

"When the board's comfortable that our debt is down to a prudent level they'll then make a decision whether to reintroduce a dividend," he said.

Newcrest last paid a dividend in early 2013.

Fat Prophets analyst David Lennox said offloading Telfer would help the company improve its debt position but leave a big gap in its production profile.

"It's not unexpected in this sort of environment that they would look at selling an asset," Mr Lennox.

"Unfortunately you have to sell reasonable assets or else you get bad prices."

Newcrest shares closed one cent lower at $13.90.

NEWCREST'S BOTTOM LINE RECOVERY

* Net profit of $200m, up from $40m in 2013/14

* Revenue of $2.01b, down from $2.02b

* No interim dividend, unchanged


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Source: AAP


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