Barrick doubles quarterly profit on improved production
But the miner says it has a ‘great deal of work’ ahead resolving problems relating to its African unit, whose buyout Barrick expects to complete in September
Toronto/Bengaluru — Barrick Gold reported quarterly adjusted profit that nearly doubled on higher production on Monday, and said it had a “great deal of work” ahead resolving problems around its African unit, whose buyout the company expects to complete in September.
Barrick also said it planned to begin the sale process for its 50% stake in the Kalgoorlie operation in Western Australia in the third quarter. Newmont Goldcorp owns the remainder.
The world's second-largest gold producer reported adjusted profit of $154m, or nine US cents per share, in the second quarter ended June 30, up from $81m, or 7c per share, a year earlier.
Barrick expects 2019 gold production to be at the higher end of its 5.1-million to 5.6-million range, and all-in sustaining costs to be at the lower end of its $870-$920 per ounce range.
Barrick's shares rose 2.1% to C$24.47 in Toronto.
The Canada-based company is in the process of integrating operations following a flurry of activity over the past few quarters, from the acquisition of Randgold Resources late in 2018 to a joint venture in Nevada with the world's biggest gold producer, Newmont Goldcorp, to the buyout of Tanzania-focused unit Acacia Mining.
CEO Mark Bristow, who led Randgold before taking over leadership of the combined company, said in Barrick's earnings statement that Acacia's operations had not been managed by previous Barrick management.
He said Barrick must work to “get to grips” with Acacia's operations, and sort out disputes the London-listed miner has faced in Tanzania.
In a separate statement on Monday, Acacia said the Tanzanian government had lifted a July suspension of gold shipments from its North Mara mine.
Barrick swung to a net profit of $194m in the second quarter, or 11c a share, from a loss of $94m, or 8c, a year earlier, driven by favourable tax adjustments and currency movements, the company said. Analysts had expected a profit of $199.6m.
Gold output in the quarter jumped nearly 27% to 1.35-million ounces from a year ago, while copper rose about 17% to 97-million pounds.
Bloomberg reported last week that Barrick was seeking to sell its Tongon mine in Ivory Coast. The company is preparing the sale of its Lumwana mine in Zambia in the second half, Reuters reported in May.
Kalgoorlie, Tongon and Lumwana are not among the tier 1 assets that Barrick has said it will focus on.