NEWCREST Mining managed to book a statutory profit of $A40 million for the second half of 2013.

The figure was down significantly on the corresponding prior period when it reported a A$323 million profit.

Underlying profit for the six months was A$207 million. Newcrest said the benefit of a 26 per cent increase in gold sales volume was largely offset by a 13% lower average realised gold price compared to the corresponding prior period.

Gold sales of 1.2 million ounces pushed revenue up 12% to A$2 billion.

Meanwhile, earnings before interest, tax, depreciation and amortisation was A$731 million and earnings before interest and tax were A$404 million.

Newcrest said its free cash f low for the period was an outflow of A$229 million, A$694 million lower than the corresponding prior period.

Newcrest chief executive Greg Robinson said Newcrest was making improvements on the financial and operational front.

“Newcrest has made steady progress on producing lower cost, higher margin ounces, while reducing costs and capital expenditure across the business,” he said.

“Overall, our focus remains on optimising our current operations, maintaining our growth options and maximising free cash f low to enable the company to reduce gearing and return to paying dividends to shareholders.”

Newcrest said it continued to focus on being free cash f low positive in the 2014 financial year at an average realised gold price lower than A$1,450 per ounce, subject to market and operating conditions.

The company’s half-year financials were released in the wake of its December quarterly report, which stated gold production reached 621,125 ounces, 6% higher than in the September 2013 quarter.

Increased production, sales, lower levels of production stripping and sustaining capital and a continuing “cost-out” focus combined to deliver a 16% reduction in Newcrest’s all-in sustaining costs to A$921 per ounce quarter-on-quarter.

At the company’s Lihir mine in Papua New Guinea, quarterly production tipped in at 187,591 ounces of gold at an all-in sustaining cost of A$1,253 per ounce. Gold production was 4% lower than the previous quarter as a 2% increase in mill throughput was offset by a 2% decline in gold grade and a 4% reduction in gold recoveries. The lower gold grade was the result of a higher proportion of mill feed from lower grade stockpiles during the quarter, while higher mill throughput reflects increased feed rates.

Mill throughput exceeded one million tonnes in December as de-bottlenecking of the grinding circuit continued.

At Newcrest’s 50%-owned Hidden Valley operation in PNG, the company recorded quarterly production of 24,792oz of gold and 272,710oz of silver.

Gold production was in line with the previous quarter as increased gold recoveries from a similar mill throughput were offset by a lower gold feed grade during the quarter. Silver production was 8% higher than the previous quarter reflecting an 11% increase in silver recoveries associated with an increased proportion of ore feed from the Hidden Valley open pit.

The operating performance of the overland conveyor improved during the quarter and minor configuration changes to the crusher were completed.

Newcrest reported a 29% dip in all-in sustaining costs during the December quarter to A$1,343/oz, primarily reflecting lower production stripping, increased silver by-product credits, lower sustaining capital expenditure and continued cost reduction efforts. Production delivery against a lower operating cost base remains the key focus with the implementation of “cost out” programs ongoing.