Newcrest bonus for Lihir losses
The goldminer confirmed on Monday that former corporate affairs manager Stephen Creese, executive manager of minerals Colin Moorhead and executive manager of communications Debra Stirling would each be paid $125,000 worth of bonuses for their role in the 2010 acquisition.
The payments were agreed to several years ago, and come on top of payments of $75,000 each in 2011 and $100,000 each in 2012.
Newcrest paid about $9.5 billion for Lihir in 2010, in a deal that was funded mostly by shares.
Despite its impressive prospectivity, Lihir has proved to be a problem for Newcrest, with important pieces of equipment repeatedly failing and requiring replacement or improvement.
The Papua New Guinea mine has been a contributing factor in several gold production downgrades for Newcrest in recent times, and operations there were significantly scaled back in June in response to the lower gold price.
The Australian Shareholders Association has already been critical of the bonuses paid to former Newcrest chief executive Ian Smith for landing the Lihir acquisition, and has threatened to vote against the company's remuneration report at the annual meeting in October.
Newcrest on Monday continued its defence of Lihir, saying in a statement it remained a "world-class" asset with a potential lifespan of more than 30 years. Newcrest insists Lihir contributes a similar amount of its total valuation as it did when acquired.
Meanwhile, the gold miner appears to have altered an aspect of its disclosure regime, after it published on the ASX announcements platform a presentation that chief executive Greg Robinson was scheduled to present in the US on Tuesday. In May, Newcrest did not alert the ASX announcements platform to an important speech Mr Robinson was presenting to big investors in Barcelona.
The company and its disclosure regime continues to be under investigation by the Australian Securities and Investments Commission.
Frequently Asked Questions about this Article…
Newcrest paid a total of $375,000 in bonuses to three executives for their role in the 2010 Lihir acquisition. Each of the three — Stephen Creese, Colin Moorhead and Debra Stirling — received $125,000 this year, on top of earlier payments of $75,000 each in 2011 and $100,000 each in 2012. The company says these payments were agreed several years ago.
The article reports a $3.69 billion write-down of Lihir in the same year bonuses were paid. It links the write-down to ongoing problems at the Papua New Guinea mine — including repeated equipment failures and the need for replacements or improvements — and to Lihir's role in several recent gold production downgrades for Newcrest.
Newcrest paid about $9.5 billion for Lihir in 2010, and the deal was funded mostly by issuing shares.
Yes. Lihir has been a contributing factor to several gold production downgrades for Newcrest. Operations at the Papua New Guinea mine were significantly scaled back in June in response to the lower gold price, according to the article.
The Australian Shareholders Association has criticised the bonuses tied to the Lihir acquisition — including payments to former CEO Ian Smith — and has threatened to vote against Newcrest’s remuneration report at the company’s annual meeting in October.
Newcrest says Lihir remains a "world-class" asset with a potential lifespan of more than 30 years and insists the asset contributes a similar amount to the company’s total valuation as it did when acquired.
The article notes Newcrest published on the ASX announcements platform a presentation that CEO Greg Robinson was scheduled to give in the US. It contrasts this with an earlier case in May when Newcrest did not alert the ASX announcements platform to an important speech Mr Robinson presented to big investors in Barcelona, suggesting an apparent change in disclosure practice.
Yes. The company and its disclosure regime continue to be under investigation by the Australian Securities and Investments Commission (ASIC), according to the article.
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