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Barrick Gold's (GOLD) Q1 Earnings Top Estimates, Revenues Lag

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Barrick Gold Corporation (GOLD - Free Report) reported a first-quarter 2023 net income of $120 million or 7 cents per share, down from $438 million or 25 cents per share in the year-ago quarter.

Barring one-time items, adjusted earnings were 14 cents per share. The figure beat the Zacks Consensus Estimate of 11 cents.

Barrick recorded sales of $2,643 million, down around 7.4% year over year. The figure missed the Zacks Consensus Estimate of $3,207.6 million.

The results in the reported quarter were hurt by lower year-over-year gold and copper production, a fall in gold sales volumes and higher costs.

Barrick Gold Corporation Price, Consensus and EPS Surprise

Barrick Gold Corporation Price, Consensus and EPS Surprise

Barrick Gold Corporation price-consensus-eps-surprise-chart | Barrick Gold Corporation Quote

Operational Highlights

Total gold production was 952,000 ounces in the reported quarter, down around 3.9% year over year and 15% sequentially. The lower production was mainly due to reduced output at Carlin resulting from annual roaster maintenance, which led to a fall in throughput at Goldstrike.

First-quarter gold sales were 954,000 ounces, down around 4% year over year.

Average realized price of gold was $1,902 per ounce in the quarter, up around 1% year over year.

Cost of sales increased about 16% year over year to $1,378 per ounce.

All-in sustaining costs (AISC) moved up around 18% year over year to $1,370 per ounce in the quarter.

Copper production declined approximately 13% year over year to 88 million pounds. Average realized copper price was $4.20 per pound, down around 10% year over year.

Financial Position

At the end of the reported quarter, Barrick had cash and cash equivalents of $4,377 million, down around 26% year over year. The company’s debt was $4,777 million at the end of the quarter, down roughly 7% year over year.

Operating cash flow was $776 million for the quarter, down around 22.7% year over year.

Guidance

For 2023, Barrick anticipates attributable gold production in the range of 4.2-4.6 million ounces. It sees stronger year-over-year production performance from Cortez, Pueblo Viejo and Turquoise Ridge.

The company expects AISC in the range of $1,170-$1,250 per ounce, cash costs per ounce in the band of $820-$880 per ounce and cost of sales within $1,170-$1,250 per ounce for 2023.

The company also projects copper production in the range of 420-470 million pounds for 2023. It also sees copper AISC of $2.95-$3.25 per pound, cash costs per ounce in the band of $2.05-$2.25 and cost of sales of $2.60-$2.90 per pound.

Capital expenditures are projected between $2,200 million and $2,600 million for 2023.

Price Performance

Barrick’s shares have lost 9.4% in the past year against a 5.8% rise of the industry.

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Rank & Key Picks

GOLD currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the Basic Materials space include Steel Dynamics, Inc. (STLD - Free Report) , Linde plc (LIN - Free Report) and PPG Industries, Inc. (PPG - Free Report)

Steel Dynamics currently carries a Zacks Rank #2 (Buy). Shares of STLD have gained 18.3% in the past year. It topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 10.7% on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Linde, currently carrying a Zacks Rank #2, has a projected earnings growth rate of 11.9% for the current year. The Zacks Consensus Estimate for LIN’s current-year earnings has been revised 4.8% upward in the past 60 days. It has a trailing four-quarter earnings surprise of 6.9%, on average. The stock has gained 15.4% over the past year.

PPG Industries currently carries a Zacks Rank #2 and has a projected earnings growth rate of 17.7% for the current year. Shares of PPG have gained 3% in the past year. It delivered a trailing four-quarter earnings surprise of 6.8% on average.

 

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