The slump in gold prices is hitting Newcrest Mining, the largest gold producer in Australia, hard as the company announced that it would write down the value of its assets by about A$6.2 billion.
The writedown charge for four mines in Australia, Papua New Guinea and Africa and its stake in Evolution Mining Ltd. (EVN) is approximate and is subject to audit, Melbourne-based Newcrest said in a statement. The company, which will report full-year earnings next week, has a market value of A$8.6 billion, Bloomberg reported.
Newcrest’s June estimate of a writedown of between A$5 billion and A$6 billion did not include the A$273 million Evolution writedown and A$360 million for other assets. Newcrest joins rivals including Newmont Mining Corp., the second-largest producer, in making writedowns after gold prices fell into a bear market in April.
Newcrest is cutting spending, suspending high-cost operations and closing its Brisbane office, which has about 100 staff, it said in June.