Stock Analysis on Net

Newmont Corp. (NYSE:NEM)

$22.49

This company has been moved to the archive! The financial data has not been updated since April 29, 2024.

Economic Value Added (EVA)

Microsoft Excel

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Paying user area

The data is hidden behind: . Unhide it.

This is a one-time payment. There is no automatic renewal.


We accept:

Visa Mastercard American Express Maestro Discover JCB PayPal Google Pay
Visa Secure Mastercard Identity Check American Express SafeKey

Economic Profit

Newmont Corp., economic profit calculation

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Net operating profit after taxes (NOPAT)1
Cost of capital2
Invested capital3
 
Economic profit4

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2023 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= × =


The financial data exhibits notable variations and declining performance indicators over the five-year period. Several key financial metrics display trends that reveal the company's operational and capital efficiency challenges.

Net Operating Profit After Taxes (NOPAT)
The NOPAT demonstrates a significant downward trajectory. Starting at 3,486 million USD in 2019, it fell sharply to 2,630 million USD in 2020, followed by an even more drastic decline to 274 million USD in 2021. The trend worsens with negative figures in both 2022 (-555 million USD) and 2023 (-2,520 million USD), indicating operational losses and deteriorating profitability.
Cost of Capital
The cost of capital remains relatively stable, fluctuating modestly between 8.6% and 9.16% over the period. This suggests that external factors affecting the capital costs were relatively constant, with a slight decline in 2023. Despite this stability, the company’s ability to generate returns above this cost has clearly diminished.
Invested Capital
Invested capital shows variability, with a moderate increase from 28,943 million USD in 2019 to 29,461 million USD in 2020, followed by a decline to 27,566 million USD in 2021 and a further drop to 23,044 million USD in 2022. However, there is a pronounced jump to 36,379 million USD in 2023. This sharp increase in invested capital in 2023 contrasts with the declining profitability and suggests increased investment or asset base expansion despite negative returns.
Economic Profit
Economic profit declines dramatically across the time span. It starts positively at 907 million USD in 2019, turning slightly negative (-16 million USD) in 2020. The negative trend accelerates through 2021 (-2,251 million USD) and 2022 (-2,639 million USD), culminating in a substantial loss of -5,647 million USD in 2023. This deterioration reflects the inability to cover the cost of capital, underlining value destruction during these years.

In summary, the data reflects significant operational and financial difficulties beginning in 2021, with persistent losses through 2023. Despite stable or slightly declining capital costs, the steep decline in operating profit and the large increase in invested capital in the final year have resulted in substantial negative economic profit, indicating a challenging financial environment and potential inefficiencies in capital utilization.


Net Operating Profit after Taxes (NOPAT)

Newmont Corp., NOPAT calculation

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Net income (loss) attributable to Newmont stockholders
Deferred income tax expense (benefit)1
Increase (decrease) in equity equivalents2
Interest expense, net of capitalized interest
Interest expense, operating lease liability3
Adjusted interest expense, net of capitalized interest
Tax benefit of interest expense, net of capitalized interest4
Adjusted interest expense, net of capitalized interest, after taxes5
(Gain) loss on marketable securities
Interest income
Investment income, before taxes
Tax expense (benefit) of investment income6
Investment income, after taxes7
(Income) loss from discontinued operations, net of tax8
Net income (loss) attributable to noncontrolling interest
Net operating profit after taxes (NOPAT)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in equity equivalents to net income (loss) attributable to Newmont stockholders.

3 2023 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =

4 2023 Calculation
Tax benefit of interest expense, net of capitalized interest = Adjusted interest expense, net of capitalized interest × Statutory income tax rate
= × 21.00% =

5 Addition of after taxes interest expense to net income (loss) attributable to Newmont stockholders.

6 2023 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =

7 Elimination of after taxes investment income.

8 Elimination of discontinued operations.


The financial data reveals significant fluctuations in profitability over the five-year period ending in 2023. Net income attributable to stockholders showed a positive trend through 2019 and 2020, peaking at approximately $2.8 billion in those years. However, a sharp decline is evident starting in 2021, where net income drops to around $1.2 billion, followed by a transition to negative territory in 2022 and 2023, with losses reaching nearly $0.4 billion and $2.5 billion respectively.

Similarly, the net operating profit after taxes (NOPAT) follows a comparable trajectory. It decreased from $3.5 billion in 2019 to $2.6 billion in 2020, then plummeted to just $274 million in 2021. The subsequent years show further deterioration into negative values, with losses of about $555 million in 2022 and $2.5 billion in 2023.

Profitability Trends
The company experienced robust profitability in 2019 and 2020, but profitability sharply declined starting in 2021, transitioning into losses by 2022 and 2023.
Net Income Analysis
Net income sustained positive values for the first three years analyzed, but the significant drop in 2021 indicates operational or market challenges. The losses in the last two years suggest ongoing issues impacting the bottom line.
NOPAT Analysis
NOPAT mirrored net income movements but showed an earlier and steeper decline, reflecting diminishing operational efficiency or increased expenses relative to operating profit.
Overall
The data suggests increasing financial strain from 2021 onward, with deteriorating profitability and operational performance. The downward trend in both net income and NOPAT highlights potential risks or negative developments affecting financial health.

Cash Operating Taxes

Newmont Corp., cash operating taxes calculation

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Income and mining tax expense
Less: Deferred income tax expense (benefit)
Add: Tax savings from interest expense, net of capitalized interest
Less: Tax imposed on investment income
Cash operating taxes

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).


Income and Mining Tax Expense
The income and mining tax expense exhibited notable fluctuations over the five-year period. Initially, it decreased from 832 million US dollars in 2019 to 704 million in 2020. This decline was followed by a significant increase to 1,098 million in 2021, representing the highest value in the period under review. Subsequently, the expense dropped sharply to 455 million in 2022 before experiencing a moderate rise to 526 million in 2023. Overall, the tax expense shows a volatile pattern with a peak occurring in 2021 and lower values in the later years.
Cash Operating Taxes
Cash operating taxes demonstrated an overall upward trend from 2019 through 2021, increasing from 550 million to 1,262 million US dollars. The growth in this category was consistent and pronounced during these years. However, in 2022, there was a significant decline to 765 million, and this downward trend continued into 2023, with the amount further decreasing to 651 million. This pattern indicates strong growth in cash operating taxes during the initial years, followed by a substantial reduction in the final two years.
Comparative Analysis
Both income and mining tax expense and cash operating taxes peaked in 2021 before declining in the subsequent years. The variations in income and mining tax expense were more pronounced, exhibiting greater volatility, whereas cash operating taxes had a steadier increase prior to the decline. The decline in both categories after 2021 may suggest changes in operational efficiencies, tax policies, or variations in taxable income. The divergence in magnitude of fluctuations between the two items could imply differences in their calculation bases or timing recognition.

Invested Capital

Newmont Corp., invested capital calculation (financing approach)

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Current finance lease and other financing obligations
Current debt
Non-current debt
Non-current finance lease and other financing obligations
Operating lease liability1
Total reported debt & leases
Total Newmont stockholders’ equity
Net deferred tax (assets) liabilities2
Equity equivalents3
Accumulated other comprehensive (income) loss, net of tax4
Contingently redeemable noncontrolling interest
Noncontrolling interests
Adjusted total Newmont stockholders’ equity
Construction-in-progress5
Marketable securities and restricted marketable securities6
Invested capital

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of equity equivalents to total Newmont stockholders’ equity.

4 Removal of accumulated other comprehensive income.

5 Subtraction of construction-in-progress.

6 Subtraction of marketable securities and restricted marketable securities.


The financial data reveals several notable trends in the company's capital structure and financing activities over the five-year period ending December 31, 2023.

Total Reported Debt & Leases
The total reported debt and leases showed a generally declining trend from 2019 through 2022, dropping from $6,909 million in 2019 to $6,248 million in 2022. This reduction suggests the company was actively managing and reducing its debt obligations during this period. However, in 2023, there was a significant increase to $9,541 million, reversing the downward trend and indicating a substantial rise in leverage or new financing activities undertaken in that year.
Total Newmont Stockholders’ Equity
Stockholders’ equity increased from $21,420 million in 2019 to a peak of $23,008 million in 2020, reflecting growth in the equity base. The level then moderately declined in the following two years, reaching $19,354 million in 2022. In 2023, equity rebounded sharply to $29,027 million, exceeding all previous years in the data set. This sharp rise might indicate retained earnings accumulation, equity infusions, or favorable changes in asset valuations leading to an expanded equity base.
Invested Capital
Invested capital initially increased slightly from $28,943 million in 2019 to $29,461 million in 2020, then declined steadily to $23,044 million by the end of 2022. This decreasing trend corresponds with the reductions in both equity and debt earlier noted, possibly reflecting asset sales, depreciation, or less capital deployment during this period. In 2023, invested capital surged to $36,379 million, marking a significant expansion of the capital base, likely linked to the increased debt and equity levels recorded the same year.

Overall, the data indicates a phase of consolidation or capital reduction from 2020 to 2022, characterized by declines in debt, equity, and invested capital. This was followed by a strong growth phase in 2023, with marked increases across all major capital metrics. The simultaneous rise in debt and equity suggests an aggressive capital expansion, possibly to fund new investments or strategic initiatives. This shift in 2023 represents a significant change in the company's financial strategy compared to the prior years.


Cost of Capital

Newmont Corp., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, finance lease and other financing obligations3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2023-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt, finance lease and other financing obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, finance lease and other financing obligations3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2022-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt, finance lease and other financing obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, finance lease and other financing obligations3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2021-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt, finance lease and other financing obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, finance lease and other financing obligations3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2020-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt, finance lease and other financing obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, finance lease and other financing obligations3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2019-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt, finance lease and other financing obligations. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

Newmont Corp., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Economic profit1
Invested capital2
Performance Ratio
Economic spread ratio3
Benchmarks
Economic Spread Ratio, Competitors4
Freeport-McMoRan Inc.

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 Economic profit. See details »

2 Invested capital. See details »

3 2023 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =

4 Click competitor name to see calculations.


Economic Profit
The economic profit exhibited a clear declining trend over the observed periods. Starting with a positive value of 907 million USD at the end of 2019, it sharply dropped to -16 million USD in 2020, indicating a near breakeven point. Subsequently, the economic profit continued to worsen significantly, reaching -2,251 million USD in 2021, -2,639 million USD in 2022, and further declining to -5,647 million USD by the end of 2023. This demonstrates increasing economic losses over the years.
Invested Capital
The invested capital showed some fluctuations during the period. It initially increased slightly from 28,943 million USD in 2019 to 29,461 million USD in 2020. However, it then decreased for two consecutive years—to 27,566 million USD in 2021 and further down to 23,044 million USD in 2022. A significant rebound was observed in 2023, with invested capital rising substantially to 36,379 million USD. This indicates changes in asset investment levels, with a notable increase in the most recent year after a period of contraction.
Economic Spread Ratio
The economic spread ratio, representing the return spread on invested capital, demonstrated a sharply negative trend across the entire timeframe. Initially positive at 3.13% at the end of 2019, it fell to -0.05% in 2020, signifying almost no economic value added at that time. The ratio then deteriorated markedly to -8.16% in 2021, -11.45% in 2022, and further to -15.52% in 2023. This negative trajectory correlates with the significant economic profit losses and reflects diminishing returns on invested capital.
Overall Analysis
The data collectively depict a financial performance that has weakened notably from 2019 through 2023. Despite fluctuations in invested capital—with a notable increase in the last reported year—the company has experienced increasing negative economic profits and worsening economic spread ratios. This pattern suggests challenges in generating returns above the cost of capital and indicates potential operational or market difficulties impacting the company's value creation over these years.

Economic Profit Margin

Newmont Corp., economic profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Economic profit1
Sales
Performance Ratio
Economic profit margin2
Benchmarks
Economic Profit Margin, Competitors3
Freeport-McMoRan Inc.

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 Economic profit. See details »

2 2023 Calculation
Economic profit margin = 100 × Economic profit ÷ Sales
= 100 × ÷ =

3 Click competitor name to see calculations.