Newmont Mining Corp (NYSE:NEM) continues to deal with low commodity prices. However, the third quarter proved it's handling the gold price trough in stride. In fact, it's even looking to expand its operations.

The quarter
Newmont's GAAP earnings in the third quarter were $0.38 per share, down from $0.42 a year ago. Adjusting for one-time items, quarterly earnings were $0.23 a share, down from $0.50 last year. Wall Street analysts had been expecting earnings of $0.17 a share, so Newmont handily beat expectations on the bottom line.

Gold bars. Source: Newmont Mining

On the top line, Newmont pulled in $2 billion in the quarter, up from $1.7 billion last year and slightly above analyst expectations of $1.95 billion. Which points to one of the key drivers of the quarter, increased production. The miner unearthed 1.34 million ounces of gold and 48,000 tonnes of copper in the quarter, up from 1.15 million ounces and 13,000 tonnes, respectively, in the same period last year. That helped support results despite low commodity prices.

The other big improvement this quarter was on the cost front. Newmont was able to reduce its all in sustaining costs, a measure of what it costs to pull gold out of the ground, 15% year over year, improving to $835 per ounce from $995 last year. The company is pretty confident in its ability to keep its costs down, too, lowering its full year all in sustaining cost guidance to a range of $880 to $940 an ounce. It previously expected its costs to range between $920 and $980 an ounce. Copper costs fell notably, as well.

The company's strong quarter was echoed at competitor Barrick Gold Corporation (USA) (NYSE:ABX), where that miner's adjusted earnings were $0.11 a share versus analyst expectations of $0.07 a share. On a GAAP basis, which included a large impairment charge, Barrick lost $0.23 a share. Cost cutting remains a big story in the gold industry, with Barrick also announcing improved cost expectations for the full year—though not to the same extent as Newmont.

A different kind of good news
So the quarter was basically a good one in a bad commodity market and Newmont is following the broad story line of the industry. But the better news is probably that Newmont is moving forward with an expansion project at its Tanami mine. The expansion project is expected to increase production to between 425,000 and 475,000 ounces per year and help to further reduce costs.

Gold being poured. Source: Newmont Mining

The most impressive thing about the project, however, is that the expected return on it is around 35% even in today's low commodity price environment. This is a big statement to Newmont's ability to keep expanding profitably even while its prime market is out of favor.

Another nice take away from the quarter is a longer-term look at the company's cash. At the start of 2014 the miner had around $1.5 billion in cash on the balance sheet. At the end of the third quarter it had nearly $3 billion. There's a lot that goes into that number, including debt moves and equity raises, but it shows that Newmont is working to solidify its balance sheet, further helping to ensure it lives through this downturn and gets better as it does.

Nice, but it ain't over yet
So was the third quarter a blow out quarter? No. Was it a turnaround quarter? No again. But it was a solid showing in a very difficult market environment. It displays just how strong Newmont really is, which should put at least a little smile on investors' faces even if the gold rebound that's really needed to push Newmont's results into high gear isn't here yet.

Reuben Brewer has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.