Barrick Gold Corp. (NYSE: ABX) reported second-quarter adjusted earnings per share (EPS) of $0.78 on $3.28 billion in revenue this morning. Adjusted EPS were sharply down from $1.12 per share in the same period a year ago, and revenue was also down from $3.42 billion. The results compare to the Thomson Reuters consensus estimates for EPS of $0.95 and $3.5 billion in revenue.
The gold miner maintained its production outlook for the full year at 7.3 to 7.8 million ounces of gold. The annual total cash costs for gold are expected to rise slightly to $550 to $575 an ounce. Barrick expects total cash costs, including copper production costs, to be lower in the second half of the year due to higher production levels and a bigger share of production from lower cost mines. The consensus estimate for third-quarter EPS is $1.15 and the full-year estimated EPS is $4.55.
The company’s new president and CEO — and prior to that its CFO — noted:
Our second quarter earnings reflected lower gold production and higher operating costs as anticipated, but we continue to generate strong financial results and expect to have a stronger second half. … I have also initiated a thorough review of our mines and projects to evaluate their rates of return and ability to generate free cash flow as part of a more disciplined capital allocation framework. In my view, rate of return should drive production, not the other way around.
Barrick’s profit decline reflects higher cost of sales for both copper and gold, lower gold sales volume, and lower realized prices for copper. Higher gold prices and higher copper sales volumes helped offset the cost of sales, but total cash costs for gold production in the second quarter reached $613 an ounce. The lower cash costs estimated for the third quarter and full year really reflect increased production.
Shares are down 2.4% in premarket trading at $33.00, in a 52-week range of $32.88 to $55.95. Thomson Reuters had a consensus analyst price target of $57.29 before today’s results were announced.
Paul Ausick
The #1 Thing to Do Before You Claim Social Security (Sponsor)
Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.
A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.
Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
