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Barrick Gold Corporation recorded net loss (attributable to equity holders) of $11 million or a penny per share for third-quarter 2017, as against net earnings of $175 million or 15 cents a year ago. The year-over-year decline was due to lower gold prices and production and the impact of Tanzania's concentrate export ban on Acacia.
Barring one-time items, adjusted net earnings were $186 million or 16 cents per share for the quarter. Earnings per share however, missed the Zacks Consensus Estimate of 17 cents.
Revenues fell roughly 13.2% year over year to $1,993 million in the reported quarter. The figure however, topped the Zacks Consensus Estimate of $1,965 million.
Cost of sales fell roughly 1.6% year over year to $1,270 million in the reported quarter.
Operational Highlights
Total gold production was 1.243 million ounces in the reported quarter, down roughly 10% from 1.381 million ounces a year ago.
Average realized price of gold fell to $1,274 per ounce in the reported quarter from the year-ago quarter figure of $1,333. All-in sustaining costs (AISC) increased to $772 per ounce in the reported quarter from $704 a year ago.
Copper production increased to 115 million pounds in the reported quarter from 100 million pounds in the prior-year quarter. Average realized copper price was $3.05 per pound, up from $2.18 per pound a year ago.
Financial Position
Cash and cash equivalents were $2,025 million at the end of the third quarter, down roughly 23.5% year over year.
Barrick Gold reduced total debt by roughly $1.5 billion year to date, and exceeded the initial target to reduce debt by $1.45 billion for 2017. During the quarter, the company completed redemption of roughly $731 million of May 2023 notes and also repaid the outstanding amounts as per the Pueblo Viejo project financing agreement. The company plans to reduce its total debt to $5 billion by the end of 2018, using portfolio optimizing and cash flows from operations. Also, three-quarters of the company’s $6.4 billion of outstanding debt will not mature until 2032.
Guidance
For 2017, Barrick Gold has narrowed its gold production and cost estimates.
The company now anticipates full-year gold production in the range of 5.3-5.5 million ounces, at AISC of $740-$770 per ounce and cost of sales of $790-$810 per ounce.
The company now expects full year copper production in the band of 420-440 million pounds, at AISC of $2.20-2.40 per pound and cost of sales of $1.70-$1.85 per pound.
Price Performance
Barrick Gold’sshares have declined 14% in the last three months, underperforming the 1.8% dip recorded by its industry.
Zacks Rank & Key Picks
Barrick Goldcurrently carries a Zacks Rank #3 (Hold).
Huntsman has an expected long-term earnings growth rate of 7%.
FMC has an expected long-term earnings growth rate of 11.3%.
Westlake Chemical has an expected long-term earnings growth rate of 8.3%.
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Barrick Gold (ABX) Q3 Earnings Miss, Revenues Beat Estimates
Barrick Gold Corporation recorded net loss (attributable to equity holders) of $11 million or a penny per share for third-quarter 2017, as against net earnings of $175 million or 15 cents a year ago. The year-over-year decline was due to lower gold prices and production and the impact of Tanzania's concentrate export ban on Acacia.
Barring one-time items, adjusted net earnings were $186 million or 16 cents per share for the quarter. Earnings per share however, missed the Zacks Consensus Estimate of 17 cents.
Revenues fell roughly 13.2% year over year to $1,993 million in the reported quarter. The figure however, topped the Zacks Consensus Estimate of $1,965 million.
Cost of sales fell roughly 1.6% year over year to $1,270 million in the reported quarter.
Operational Highlights
Total gold production was 1.243 million ounces in the reported quarter, down roughly 10% from 1.381 million ounces a year ago.
Average realized price of gold fell to $1,274 per ounce in the reported quarter from the year-ago quarter figure of $1,333. All-in sustaining costs (AISC) increased to $772 per ounce in the reported quarter from $704 a year ago.
Copper production increased to 115 million pounds in the reported quarter from 100 million pounds in the prior-year quarter. Average realized copper price was $3.05 per pound, up from $2.18 per pound a year ago.
Financial Position
Cash and cash equivalents were $2,025 million at the end of the third quarter, down roughly 23.5% year over year.
Barrick Gold reduced total debt by roughly $1.5 billion year to date, and exceeded the initial target to reduce debt by $1.45 billion for 2017. During the quarter, the company completed redemption of roughly $731 million of May 2023 notes and also repaid the outstanding amounts as per the Pueblo Viejo project financing agreement. The company plans to reduce its total debt to $5 billion by the end of 2018, using portfolio optimizing and cash flows from operations. Also, three-quarters of the company’s $6.4 billion of outstanding debt will not mature until 2032.
Guidance
For 2017, Barrick Gold has narrowed its gold production and cost estimates.
The company now anticipates full-year gold production in the range of 5.3-5.5 million ounces, at AISC of $740-$770 per ounce and cost of sales of $790-$810 per ounce.
The company now expects full year copper production in the band of 420-440 million pounds, at AISC of $2.20-2.40 per pound and cost of sales of $1.70-$1.85 per pound.
Price Performance
Barrick Gold’sshares have declined 14% in the last three months, underperforming the 1.8% dip recorded by its industry.
Zacks Rank & Key Picks
Barrick Goldcurrently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Huntsman Corporation (HUN - Free Report) , FMC Corporation (FMC - Free Report) and Westlake Chemical Corporation (WLK - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
Huntsman has an expected long-term earnings growth rate of 7%.
FMC has an expected long-term earnings growth rate of 11.3%.
Westlake Chemical has an expected long-term earnings growth rate of 8.3%.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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