MORE unpleasant surprises could yet emerge from Newcrest Mining's two troublesome growth projects, with the gold producer offering an unusually broad guidance range for production over the coming year.
The nation's biggest listed goldminer has endured a frustrating year as repeated problems at its Lihir and Cadia East development projects forced it to downgrade its production guidance several times.
Those downgrades eroded investor confidence, with the company's value almost halving over the past year a loss of close to $17 billion despite gold stocks traditionally faring well in times of economic uncertainty.
When asked yesterday if the worst of the turbulence was behind Lihir and Cadia, Newcrest chief executive Greg Robinson cautioned that significant aspects were still to be installed and trialled, particularly at Lihir.
While Newcrest has not given full guidance for 2013, yesterday it gave production guidance of between 700,000 and 900,000 ounces for Lihir and between 400,000 and 500,000 ounces for Cadia.
Mr Robinson said the Lihir guidance was being kept "deliberately very broad" given there were significant aspects of the project still to be installed before commissioning in December.
"It's a very busy six months ahead as we bring it into commissioning," he said.
But he assured investors the company was "getting better" at running the mine "consistently". Analysts were impressed by the past three months' performance at Lihir, which comfortably exceeded expectations.
Mr Robinson said that a cost blowout on the $1.9 billion expansion at Cadia would be kept within 10 per cent of the original budget.
Deutsche analyst Chris Terry said it was clear the two projects still contained risks, and 2013 would continue to be a transition period that set up a foundation for good results and growth in the years ahead.
"The reason there's such a big range between the top and bottom (of the guidance), particularly at Lihir, is to allow for some potential issues that could arise as the project progresses," he said.
Newcrest reported gold production of 2.28 million ounces in the year to June 30, which was well below its original guidance of up to 2.92 million ounces, but in keeping with the revised guidance announced in April.
The market responded warmly to the result and a rise in the gold price pushing Newcrest shares 5 per cent higher in early trading, before they eventually closed 22?, or 1 per cent, higher at $22.37.
Part of Newcrest's recent share price slide is due to the fact that three of its biggest shareholders have been reducing their stakes recently. The world's biggest resource investor, BlackRock, yesterday gave notice it had shaved its Newcrest stake after similar moves by Commonwealth Bank and Fidelity Management.
In other gold news, ASX-listed Crusader Resources has increased reserves at its Brazilian gold project by 61 per cent.