Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Barrick Gold Corp (GOLD, Financial) reported a 33% increase in adjusted net earnings per share, reflecting strong financial performance.
- The company maintained its quarterly dividend at $0.10 and repurchased $95 million of shares, demonstrating a commitment to returning value to shareholders.
- Copper production increased by 12% quarter on quarter, with reduced costs, contributing to robust cash flows.
- Barrick Gold Corp (GOLD) has reduced its debt net of cash by 27% quarter on quarter to $500 million, maintaining a strong balance sheet.
- The company has made significant progress in sustainable mine closure, reducing closure liabilities by more than $1 billion, a 36% reduction.
Negative Points
- Gold production is expected to be at the lower end of the guidance range, indicating potential challenges in meeting production targets.
- The company faced a fatality at the Kibali mine, impacting its safety record and highlighting ongoing safety challenges.
- There are ongoing challenges with the ramp-up of the Pueblo Viejo plant expansion, including equipment failures and delays.
- Inflationary pressures and labor costs are impacting the company's cost structure, with wage inflation expected to be between 3% to 5%.
- The company is facing negotiations with the Malian government regarding economic benefits from the Loulo-Gounkoto complex, creating uncertainty in the region.
Q & A Highlights
Q: Given the lower end of production guidance and cost implications, what is the outlook for production and costs into next year, particularly for Nevada Gold Mines (NGM) and Pueblo Viejo (PV)?
A: Mark Bristow, CEO, explained that PV is still ramping up, and the Gold Quarry pit is being replanned due to a sidewall failure. The focus is on margins and long-term profitability rather than just gold production. Detailed updates will be provided at the Investor Day on November 22. Cost control in Latin America is strong, and Turquoise Ridge is making progress, expected to come in at the bottom of its guidance.
Q: Can you discuss the profile and key projects affecting sustaining CapEx in NGM, and what is the expected change in sustaining CapEx over the next few years?
A: Sustaining CapEx is expected to decrease by about $200 per ounce by 2027. Investments have been made in the Sage mill, Gold Quarry roaster, and mobile fleet. The focus is on building flexibility underground to manage costs effectively.
Q: What is the status of reserve replenishment, especially with contributions from Lumwana and Reko Diq?
A: Grant Beringer, Group Sustainability Executive, stated that North America is tracking at about 75% replacement of net depletion, Africa is looking at a net positive, and Latin America has potential positive metrics. Reko Diq and Lumwana are expected to add significantly to reserves.
Q: With the environmental rehabilitation provisions, is there more opportunity to further reduce liabilities?
A: Barrick is proactively managing closure liabilities, focusing on long-term water management and concurrent rehabilitation. The company has reduced liabilities significantly and continues to focus on safe closure of tailings facilities.
Q: What are the expectations for CapEx in 2025 compared to 2024, and how will sustaining and growth CapEx differ?
A: CapEx is expected to increase due to two major projects starting next year. Sustaining capital will focus on ensuring the company makes real money from mining its reserves, with more details to be provided at the Investor Day.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
