Barrick shares surge on release of full-year results

Bristow confident of resolution in Mali and highlights company's underlying value

Barrick’s Mark Bristow speaking at the 2024 Gold Forum Americas

Shares in Barrick Gold Corporation (TSX: ABX) rallied to a three-month high after the company released its full-year results.

The company reported a 69% rise in net earnings to US$2.14 billion, a 51% increase in adjusted net earnings to US$2.21 billion and a 30% rise in attributable EBITDA to US$5.19 billion, the highest in over a decade.

Operating cashflow increased 20% year-on-year to US$4.49 billion and free cashflow more than doubled to US$1.32 billion.

“It's great to see all the arrows once again pointing in the right direction,” Barrick CEO Mark Bristow said on a conference call on Thursday.

Full-year gold production of 3.91 million ounces and 195,000 tonnes of copper was within guidance, driven by a strong end to the year.

December quarter gold production was the strongest of the year, rising by 15% to 1.08Moz, while copper production jumped 33% to 64,000t.

Fourth quarter AISC fell by 3% to US$1451/oz of gold and by 14% to US$3.07/lb of copper, while full-year AISC was up 11% to US$1484/oz of gold and 7% to US$3.45/lb of copper.

Barrick boosted attributable gold reserves by 23%, before depletion, to 89Moz at 0.99 grams per tonne gold, while copper reserves grew by 224% to 18 million tonnes of copper at 0.45%, with grade also up 13%.

Shareholder returns

Barrick declared a quarterly dividend of US10c per share, taking total dividends for the year to US$696 million.

The company’s December quarter share buyback increased to US$354 million, taking the total for the year to US$498.

The dividend and buyback program took total shareholder returns to US$1.2 billion for 2024.

Barrick announced it would launch a new program for the repurchase of up to US$1 billion over the next 12 months.

“Very clearly, we have absolutely no hesitation to buy back our shares when they’re at these low share prices, and we’ll continue to do that,” Bristow said.

Mali

Barrick temporarily suspended its Loulo-Gounkoto gold mine in Mali last month after a dispute with the government escalated.

The government has detained several Barrick employees and has restricted Barrick from shipping gold.

As a result, gold sold in the December quarter was 965,000oz, below production.

“As you know, in addition to export restrictions, we face the unjust incarceration of some of our team members, which is a difficult situation to navigate,” Bristow said.

Bristow said Barrick was actively engaging with the government to secure their release and resolve the dispute to enable the restart of the mine.

“Our goal remains to reach a lasting solution that brings benefits to Mali while ensuring fairness and supporting the long-term viability of this world-class operation, this being crucial to the country’s economy as well as all its other stakeholders,” he said.

Bristow was also keen to address misinformation about the benefits Mali had received from the mine.

“Since 2005, we have contributed more than US$3.2 billion to the Malian treasury in the form of dividends, royalties and taxes. More recently, in the past two years alone, we contributed US$400 million in 2023 in cash to the Malian treasury and US$460 million in 2024 to that same treasury. Had the mine not been forced into temporary suspension, we were on track to contribute more than US$550 million in 2025 at current gold prices.”

Barrick has produced 10Moz of gold in Mali and added 15Moz in reserves, extending the mine life to 2041.

“But more importantly, we have built and developed local talent,” Bristow said.

“Today, Malians are operating across our global business, including in Nevada, and their expertise is a key reason why these assets continue to succeed. The talent extends beyond our workforce.

“We have helped develop Malian businesses that have pioneered growth in the mining sector, some of which have expanded beyond Mali as a country … the economic multiplier effect of mining is immense, creating opportunities to go far beyond the mine itself.”

Bristow said he was reluctant to get involved in a public negotiation with Malian authorities.

He said two former Barrick employees were advising the government and called for independent parties to review the facts.

“They don’t have to be even Barrick experts. We can get external third-party experts to review the facts, and then on that basis, we can find a way forward.”

The year ahead

For 2025, attributable gold production is forecast at 3.15–3.5Moz, excluding production from Loulo-Gounkoto, while attributable copper production is projected to increase from 195,000t last year to 200,000–230,000t, driven by increased production at Lumwana.

“It would not be a good thing to lose Loulo, not for anyone’s sake and particularly not for Mali’s, but equally for us,” Bristow said.

“Every one of our operations are independently viable, and Barrick’s balance sheet is very solid, and so with or without Loulo, it will not change our long-term plan.”

Barrick will publish technical reports for its two main growth projects, Reko Diq in Pakistan and the Lumwana Super Pit expansion in Zambia, later this month, which Bristow said would further highlight their value.

“It’s on the back of this organic growth that we can forecast a plus-30% growth in gold equivalent ounces out to the end of the decade. And as production increases, so too we expect costs to reduce,” he said.

Bristow said Barrick’s value proposition continued to increase.

“You can see that the value for Nevada and the copper business together exceeds Barrick’s market capitalization. That means there’s an implied negative value for the rest of Barrick’s tier one, tier two and other strategic assets,” he said.

“No matter how you analyze the portfolio, the current share price does not come close to reflecting the fair value of our asset base and our prospects.”

Barrick shares rallied by 6.4% on Thursday to a three-month high of C$25.97.