Barrick Mining Corporation (TSX:ABX) has reported increases in production, earnings and cashflow and a reduction in costs, with president and chief executive Mark Bristow telling analysts the result positioned the company for a stronger December half.
The company reported operating cashflow of US$2.5 billion, more than double the March quarter and up 32% year-on-year.
First half free cashflow more than doubled year-on-year to US$770 million.
Adjusted net earnings for the quarter rose 33% quarter-on-quarter to US$800 million, or US47c per share.
Speaking to analysts in London on Monday, Bristow said the result represented the best quarterly adjusted earnings per share for Barrick in more than a decade.
Half-year attributable EBITDA rose by 39% to US$3.05 billion at a margin of 53%, up 18%.
Gold production rose by 5% quarter-on-quarter to 797,000 ounces, boosted by an 11% increase in output from Nevada Gold Mines and a 28% increase at Pueblo Viejo.
All-in sustaining costs fell by 5% to US$1684 an ounce.
Copper production jumped 34% to 59,000 tonnes due to a strong contribution from Lumwana.
“On the operational front, this was another quarter with all the arrows pointing in the right direction,” Bristow said.
“The trend here is clear; Barrick is on a positive trajectory with more to come.”
The company remains on track to meet 2025 gold guidance of 3.15-3.5 million ounces of gold, which does not include any contribution from the suspended Loulo-Gounkoto mine in Mali, and the upper end of copper guidance of 200,000-230,000t.
Bristow had no update on the arbitration with the Mali government and said it was unwise to comment in the public domain.
Barrick declared a US15c per share dividend, including a performance dividend of US5c per share.
The company repurchased US$268 million in shares in the June quarter, taking total repurchases for the June half to US$411 million
Total capital returned to shareholders for the first half amounted to US$753 million.
Bristow said Barrick remained undervalued and a “peerless” investment opportunity.
“It is our opinion that Barrick remains one of the most compelling investment opportunities in the gold and copper space today,” he said.
Fourmile excitement building
Barrick has already completed 34km of drilling at the high-grade Fourmile gold discovery in Nevada so far this year.
“We’re super excited by the potential of Fourmile, Barrick’s 100%-owned asset, which is essentially an extension of Goldrush, but better,” Bristow said.
“This asset is rapidly competing to be the largest and highest-grade discovery in the industry this century.”
Bristow said the company saw the potential to double the current 7.8Moz resource “or more” by year-end.
“Fourmile is no doubt emerging as a generational asset,” he said.
Bristow said the company was still trying to determine the full potential of the discovery, but he would like to have completed a scoping study by the end of the year.
“The next step is to access it from underground, and we have the opportunity with minimal permitting to do that,” he said.
Bristow estimates the company could save US$500-600 million by drilling the deposit from underground.
“This is a world-class, tens of millions of ounces [discovery] and it’s right in the middle of infrastructure,” he said.
Testing the portfolio
Bristow said sale processes for Hemlo in Canada and Tongon in Côte d’lvoire were advancing.
“It makes good sense to clean up the portfolio and it’s a good time to do it when there are buyers in the market,” he said.
It follows the US$1 billion divestment of the Donlin project in Alaska during the quarter.
On Friday, Barrick announced it sold its non-core Alturas project in Chile to Singapore’s Boroo for US$50 million cash and a 0.5% net smelter return royalty on up to 2Moz of gold and gold equivalent production.
Bristow said the company continued to be active on the exploration front, with greenfields programs across Canada, Nevada, Peru and Tanzania.
He said the company had added 110Moz gold equivalent to reserves in the past six years and was on track to replace more than 80% of the gold it mined this year.
Barrick will present at the Mining Forum Americas, which will be held at the Broadmoor Hotel & Resort, Colorado Springs, on September 14-17.