Barrick Gold posted large profits in the second quarter following record gold prices in 2020.
The Canada-headquartered firm, which is the world’s second-largest gold miner, reported an adjusted profit of $415m, or 23 cents a share, up from $154m across the same period of 2019.
Barrick’s Q2 results up until the end of June show year-to-date gold production of 2.4 million ounces, at the mid-point of its 4.6 million to five-million-ounce guidance for 2020.
It said this was driven by “strong operating performances”, particularly from Nevada Gold Mines (NGM) in the US, Loulo-Gounkoto in Mali and Kibali in the Democratic Republic of Congo, while its copper portfolio “continued to outperform with Lumwana in Zambia posting its best quarterly production in years”.
Strong cash generation ‘demonstrated the quality of Barrick’s assets’, says CEO
Barrick’s president and CEO Mark Bristow said the strong cash generation “demonstrated the quality of Barrick’s assets, management’s ability to capture the full benefit of higher gold prices, effective operational execution and the group’s deft handling of the Covid-19 pandemic’s impact”.
“Our flattened and decentralised management structure was a major factor in contending with Covid-19, while at the same time continuing to meet short-term targets and making significant progress towards our strategic objectives,” he added.
“Our major projects, including the expansion of Pueblo Viejo, the Goldrush development and the Turquoise Ridge shaft, remain on track.
“The only exception was Veladero, where the heap leach and cross-border Chilean power line projects were impacted by the Argentine government’s pandemic quarantine restrictions.”
Bristow said the company also maintained its “strong environmental, social and governance focus” across what has been a difficult period for many firm’s worldwide.
“The Lost Time Injury Frequency Rate decreased by 15.6% quarter on quarter, and we further reduced our carbon emissions and continued to improve our water recycling and reuse performance,” he added.
Barrick’s financial performance in the second quarter
Since the start of 2020, shares in Barrick have risen by 60% to $38.75 Canadian dollars ($29.02), with gold prices reaching record highs above $2,000 per troy ounce for the first time last week.
Throughout Q2, Barrick’s operating cash flow exceeded $1bn and its free cash flow was $522m, while its revenues rose to $3.1bn – a 48% increase from a year earlier.
The miner’s net earnings per share was 20 cents and with the adjusted net earnings per share at 23 cents, that marked a 44% rise from Q1.
Its debt net of cash was reduced by almost 25% to $1.4bn from the end of Q1, while the quarterly dividend was increased by 14% to 8 cents per share.
The company claims its quarterly dividend has “more than doubled” since the announcement of the merger between Barrick and Randgold in September 2018.
The miner added that its ongoing non-core asset disposal strategy has so far delivered a value of $1.5bn, of which $1.25bn was in cash.
