Newcrest Mining Ltd. (NCM), the Australian gold producer under regulatory scrutiny over its disclosure, will restrict its dealings with investors and analysts after an internal review.
The company will implement the recommendations made in the review by Maurice Newman, a former chairman of the Australian Securities Exchange, which include limiting outlook forecasts to 12 months, Melbourne-based Newcrest said today in a statement.
“Consideration should be given to changing the emphasis from pro-active to reactive contact,” Newman wrote in the report. While restricting discussions with shareholders and analysts “may not be optimal for the investing public, it may be the company’s most prudent approach,” Newman wrote.
The Australian Securities and Investments Commission is investigating a drop in Newcrest’s share price ahead of a June 7 announcement when it flagged a writedown of as much as A$6 billion ($5.5 billion). Suisse Group AG, Citigroup Inc. and UBS AG were among banks that cut their ratings on Newcrest in the three days before its statement, prompting concern from regulators. Newcrest is continuing to assist ASIC’s inquiry, the company said.
Newman found no “smoking gun” evidence indicating analysts received selective briefings from Newcrest ahead of the announcement. He said he hadn’t been able to interview analysts because of the ASIC inquiry and hadn’t sought access to Newcrest’s e-mail records.
The gold producer fell 1.3 percent to A$13.23 at 10:36 a.m. in Sydney trading. Australia’s benchmark S&P/ASX 200 index fell 0.5 percent. Newcrest is the worst performer this year among Australia’s 50 largest publicly listed companies, declining 40 percent.
“The disclosure question is a bit of a sideshow to the broader question that the chairman and CEO ought to be held to account for A$6 billion in writedowns,” Stephen Mayne, spokesman for the Australian Shareholders’ Association, said today by phone. The association represented 277 retail investors at Newcrest’s 2012 annual general meeting.
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