Board shake-up at Newcrest

GOLD producer Newcrest Mining has announced the retirement of chairman Don Mercer, while appointing an expected successor to chief executive Greg Robinson, who is expected to leave the company in the second half of next year.
Board shake-up at Newcrest
Board shake-up at Newcrest
Board shake-up at Newcrest
Board shake-up at Newcrest
Board shake-up at Newcrest

The company has appointed chemical engineer and former Pacific Aluminium CEO Sandeep Biswas as chief operating officer and executive director from January 1, 2014.

Biswas is expected to succeed Robinson in the second half of 2014.

Robinson said he was "delighted" to appoint Biswas as his nominated successor.

"After eight years with Newcrest as CEO and previously chief financial officer, it is time to ensure there is an organised succession for the CEO role, with a successor who is committed to delivering the company's long-term strategic objectives," Robinson said.

"Sandeep has a highly successful operations and management background across multiple commodities.

"His skills and background will assist Newcrest to deliver the high performance outcomes we expect from our existing operations and progress the strong development opportunities in our asset portfolio."

Meanwhile, 72-year-old Mercer will step down as chairman in December, with relatively new board appointee Peter Hay appointed as his replacement.

Mercer said he had indicated to the board earlier this year that he would retire, prompting the appointment of new directors Hay and Philip Aiken.

"Peter Hay is an extremely experienced and capable director, whose skills and intellect will help lead Newcrest into the next stage of its development as a major gold producer," he said.

"I have been privileged to lead an extremely dedicated, hard-working and productive board of directors over the past seven years at Newcrest and I have enjoyed my time as chair.

"Working with two chief executives and their executive teams has also been a positive experience, despite the tough global economic conditions.

"I would like to pay particular tribute to Greg Robinson, who has worked hard to protect the long-term future of the company through this period and whose strong values are an example to all."

Hay, who joined the board of Newcrest in August, is a member of the Takeovers Panel and is chairman of Lazard and a director of ANZ.

"Newcrest is a company with great assets, a talented and committed workforce and is well positioned for the future having completed its major expansion projects," Hay said.

"However, in view of volatile market conditions, the board will continue to ensure the corporate strategy, asset portfolio, operating strategy and balance sheet remain appropriate, assessing all options to enhance shareholder value."


The changes come after a terrible year for Newcrest and have been announced just two weeks out from the company's annual general meeting, where the board is expected to come under intense scrutiny from angry shareholders.

Newcrest shares are down by more than 50% since the start of the year and the company is being investigated by the Australian Securities & Investments Commission over continuous disclosure.

This morning, prior to the Newcrest announcement, Macquarie Private Wealth flagged that two board seats could change at the AGM.

Between now and the AGM, the company will release its quarterly report for September.

Today it announced the preliminary results, with gold production of 586,573 ounces and copper production of 19,632 tonnes.

That compares to June quarter production of 642,032oz gold and 22,818t copper in the June quarter and 460,425oz gold and 18,598t copper in the same quarter of last year.

Newcrest previously flagged September quarter production to be lower than June, ramping up as the 2014 financial year progressed.

Cash costs after by-product credits were $A784 an ounce, up on June costs of $762/oz, while all-in sustaining cash costs were $1102/oz, lower than the $1283/oz estimated by the company for FY13.

"This is a production and cost outcome that reflects the investment and operational strategies of the group and the hard work of our people to deliver it," Robinson said.

"This quarter positions Newcrest well to deliver its guidance outcomes for the 2014 financial year."

Guidance of 2-2.3 million ounces of gold and 75,000-85,000t copper at all-in sustaining costs of around $1200/oz for FY14 remains unchanged.

Newcrest shares were down 0.9% to $10.73 by midday AEDT.


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