Higher Q2 Production Puts Barrick On Track to Deliver 2024 Targets
Barrick Gold (NYSE:GOLD)(TSX:ABX) reported preliminary Q2 2024 production of 948,000 ounces of gold and 43,000 tonnes of copper. Gold production increased from Q1, driven by improvements at Turquoise Ridge, Porgera, Tongon, North Mara, and Kibali. Copper production also rose, primarily due to higher grades and recoveries at Lumwana. The company remains on track to achieve its full-year gold and copper guidance.
Q2 gold cost metrics are expected to be slightly higher than Q1, while copper costs are projected to be lower. Barrick anticipates costs to decrease in the second half of 2024 as production ramps up. The average market price for gold in Q2 was $2,338 per ounce, and copper was $4.42 per pound.
- Q2 gold production increased to 948,000 ounces, up from Q1
- Copper production rose to 43,000 tonnes in Q2
- Company remains on track to achieve full-year gold and copper guidance
- Production expected to increase progressively each quarter through 2024
- Average market price for gold in Q2 was $2,338 per ounce, potentially boosting revenues
- Q2 gold cost of sales per ounce and total cash costs per ounce expected to be 0-2% higher than Q1
- All-in sustaining costs per ounce for gold expected to be 1-3% higher in Q2
- Copper all-in sustaining costs per pound expected to be 1-3% higher in Q2
Barrick's Q2 production update reveals promising metrics in both gold and copper outputs, with 948 thousand ounces of gold and 43 thousand tonnes of copper produced. These figures demonstrate tangible progress toward Barrick's 2024 production targets. Sales figures also align closely with production, indicating effective inventory management and market demand resonance.
One noteworthy aspect is the increase in Q2 gold production driven by various mines, particularly Turquoise Ridge, thanks to effective maintenance and ramp-up activities. This indicates robust operational execution. On the cost front, slight increases in gold's all-in sustaining costs (AISC) and total cash costs are expected, largely due to higher gold prices driving up royalties. Higher costs could impact short-term profitability, but the forecasted drop in production costs in the latter half of the year is promising for margins.
For copper, the lower cost of sales and C1 cash costs per pound against Q1 reveal efficient cost management. The slightly higher AISC for copper reflects necessary waste stripping at Lumwana, signaling investment in long-term yield improvements.
Retail investors should consider the implications of rising production and declining costs in the second half of the year, which could boost profitability and potentially the stock value. However, the market's response to full Q2 financial results will provide a clearer picture of earnings and future guidance alignment.
The market context for Barrick's commodities is also pivotal. As the average Q2 market price for gold stood at
Gold's appeal as a safe-haven asset has kept prices buoyant amid global economic uncertainties. Similarly, copper, a key industrial metal, benefits from steady demand driven by infrastructure projects and renewable energy investments. Investors should watch how macroeconomic trends and commodity price fluctuations interact with Barrick's operational performance.
Another key point is the dynamic between operational efficiency improvements and market pricing. With higher production volumes in the latter half of the year, coupled with favorable market prices, Barrick could see substantial revenue growth, positioning it well among its peers in the sector.
All amounts expressed in US dollars
TORONTO, July 16, 2024 (GLOBE NEWSWIRE) -- Barrick Gold Corporation (NYSE:GOLD)(TSX:ABX) (“Barrick” or the “Company”) today reported preliminary Q2 production of 948 thousand ounces of gold and 43 thousand tonnes of copper, as well as preliminary Q2 sales of 956 thousand ounces of gold and 42 thousand tonnes of copper. As previously guided, Barrick’s gold and copper production in 2024 is expected to progressively increase each quarter through the year with a higher weighting in the second half. The Company remains on track to achieve our full year gold and copper guidance.
The average market price for gold in Q2 was
Preliminary Q2 gold production was higher than Q1, as a result of increased production at Turquoise Ridge, following the completed maintenance at the Sage autoclave in Q1, continued successful ramp up at Porgera and significant increases at Tongon, North Mara and Kibali. These increases were partially offset by planned lower production at Cortez and Phoenix. Pueblo Viejo production was flat sequentially as throughput is ramped up with a shift to recovery rate optimization in H2 2024. Compared to Q1, Q2 gold cost of sales per ounce1 and total cash costs per ounce2 are both expected to be 0 to
Preliminary Q2 copper production was higher than Q1, driven primarily by higher grades and recoveries at Lumwana following the ramp up in stripping activities in Q1 as well as the planned shutdown in Q1. Compared to Q1 2024, Q2 copper cost of sales per pound1 is expected to be 4 to
Barrick will provide additional discussion and analysis regarding its second quarter 2024 production and sales when the Company reports its quarterly results before North American markets open on August 12, 2024.
The following table includes preliminary gold and copper production and sales results from Barrick's operations:
Three months ended June 30, 2024 | Six months ended June 30, 2024 | |||
Production | Sales | Production | Sales | |
Gold (attributable ounces (000)) | ||||
Carlin ( | 202 | 202 | 407 | 409 |
Cortez ( | 102 | 101 | 221 | 222 |
Turquoise Ridge ( | 72 | 70 | 134 | 132 |
Phoenix ( | 25 | 27 | 59 | 61 |
Nevada Gold Mines ( | 401 | 400 | 821 | 824 |
Loulo-Gounkoto ( | 137 | 137 | 278 | 277 |
Kibali ( | 82 | 81 | 158 | 153 |
Pueblo Viejo ( | 80 | 79 | 161 | 161 |
Veladero ( | 56 | 68 | 113 | 101 |
North Mara ( | 54 | 50 | 100 | 96 |
Bulyanhulu ( | 45 | 44 | 87 | 84 |
Tongon ( | 45 | 46 | 81 | 81 |
Hemlo | 37 | 39 | 74 | 77 |
Porgera ( | 11 | 12 | 15 | 12 |
Total Gold | 948 | 956 | 1,888 | 1,866 |
Copper (attributable tonnes (000)) | ||||
Lumwana | 25 | 25 | 47 | 47 |
Zaldívar ( | 10 | 9 | 19 | 18 |
Jabal Sayid ( | 8 | 8 | 17 | 16 |
Total Copper | 43 | 42 | 83 | 81 |
Second Quarter 2024 Results
Barrick will release its Q2 2024 results before market open on August 12, 2024. President and CEO Mark Bristow will host a live presentation of the results that day at 11:00 EDT, with an interactive webinar linked to a conference call. Participants will be able to ask questions.
Go to the webinar
US and Canada (toll-free) 1 844 763 8274
UK (toll) +44 20 3795 9972
International (toll) +1 647 484 8814
The Q2 2024 presentation materials will be available on Barrick’s website at www.barrick.com.
The webinar will remain on the website for later viewing, and the conference call will be available for replay by telephone at 1 855 669 9658 (US and Canada toll-free) and +1 412 317 0088 (international toll), access code 0796#.
Enquiries:
Investor and Media Relations
Kathy du Plessis
+44 20 7557 7738
barrick@dpapr.com
Website: www.barrick.com
Technical Information
The scientific and technical information contained in this news release has been reviewed and approved by: Craig Fiddes, SME-RM, Lead, Resource Modeling, Nevada Gold Mines; Simon Bottoms, CGeol, MGeol, FGS, FAusIMM, Mineral Resource Management and Evaluation Executive (in this capacity, Mr. Bottoms is responsible on an interim basis for scientific and technical information relating to the Latin America and Asia Pacific region); and Richard Peattie, MPhil, FAusIMM, Mineral Resources Manager: Africa and Middle East — each a “Qualified Person” as defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects.
Endnote 1
Gold cost of sales per ounce is calculated as cost of sales across our gold operations (excluding sites in care and maintenance) divided by ounces sold (both on an attributable basis based on Barrick’s ownership share). Copper cost of sales per pound is calculated as cost of sales across our copper operations divided by pounds sold (both on an attributable basis based on Barrick’s ownership share).
References to attributable basis means our
Endnote 2
Total cash costs per ounce and all-in sustaining costs per ounce are non-GAAP financial measures which are calculated based on the definition published by the World Gold Council (“WGC”) (a market development organization for the gold industry comprised of and funded by gold mining companies from around the world, including Barrick). The WGC is not a regulatory organization. Management uses these measures to monitor the performance of our gold mining operations and its ability to generate positive cash flow, both on an individual site basis and an overall company basis.
Total cash costs start with our cost of sales related to gold production and removes depreciation, the non-controlling interest of cost of sales and includes by-product credits. All-in sustaining costs start with total cash costs and include sustaining capital expenditures, sustaining leases, general and administrative costs, minesite exploration and evaluation costs and reclamation cost accretion and amortization. These additional costs reflect the expenditures made to maintain current production levels.
We believe that our use of total cash costs and all-in sustaining costs will assist analysts, investors and other stakeholders of Barrick in understanding the costs associated with producing gold, understanding the economics of gold mining, assessing our operating performance and also our ability to generate free cash flow from current operations and to generate free cash flow on an overall company basis. Due to the capital-intensive nature of the industry and the long useful lives over which these items are depreciated, there can be a significant timing difference between net earnings calculated in accordance with IFRS and the amount of free cash flow that is being generated by a mine and therefore we believe these measures are useful non-GAAP operating metrics and supplement our IFRS disclosures. These measures are not representative of all of our cash expenditures as they do not include income tax payments, interest costs or dividend payments. These measures do not include depreciation or amortization.
Total cash costs per ounce and all-in sustaining costs per ounce are intended to provide additional information only and do not have standardized definitions under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. These measures are not equivalent to net income or cash flow from operations as determined under IFRS. Although the WGC has published a standardized definition, other companies may calculate these measures differently.
C1 cash costs per pound and all-in sustaining costs per pound are non-GAAP financial measures related to our copper mine operations. We believe that C1 cash costs per pound enables investors to better understand the performance of our copper operations in comparison to other copper producers who present results on a similar basis. C1 cash costs per pound excludes royalties and production taxes and non-routine charges as they are not direct production costs. All-in sustaining costs per pound is similar to the gold all-in sustaining costs metric and management uses this to better evaluate the costs of copper production. We believe this measure enables investors to better understand the operating performance of our copper mines as this measure reflects all of the sustaining expenditures incurred in order to produce copper. All-in sustaining costs per pound includes C1 cash costs, sustaining capital expenditures, sustaining leases, general and administrative costs, minesite exploration and evaluation costs, royalties and production taxes, reclamation cost accretion and amortization and write-downs taken on inventory to net realizable value.
Barrick will provide a full reconciliation of these non-GAAP financial measures when the Company reports its quarterly results on August 12, 2024.
Cautionary Statements Regarding Preliminary Second Quarter Production, Sales and Costs for 2024, and Forward-Looking Information
Barrick cautions that, whether or not expressly stated, all second quarter figures contained in this press release including, without limitation, production levels, sales and associated costs are preliminary, and reflect our expected second quarter results as of the date of this press release. Actual reported second quarter production levels, sales and associated costs are subject to management’s final review, as well as review by the Company’s independent accounting firm, and may vary significantly from those expectations because of a number of factors, including, without limitation, additional or revised information, and changes in accounting standards or policies, or in how those standards are applied. Barrick will provide additional discussion and analysis and other important information about its second quarter production levels, sales and associated costs when it reports actual results on August 12, 2024. For a complete picture of the Company’s financial performance, it will be necessary to review all of the information in the Company’s second quarter financial report and related MD&A. Accordingly, readers are cautioned not to rely solely on the information contained herein.
Finally, Barrick cautions that this press release contains forward-looking statements with respect to: (i) Barrick’s production and full year gold and copper guidance; and (ii) costs per ounce for gold and per pound for copper.
Forward-looking statements are necessarily based upon a number of estimates and assumptions including material estimates and assumptions related to the factors set forth below that, while considered reasonable by the Company as at the date of this press release in light of management’s experience and perception of current conditions and expected developments, are inherently subject to significant business, economic, and competitive uncertainties and contingencies. Known or unknown factors could cause actual results to differ materially from those projected in the forward-looking statements, and undue reliance should not be placed on such statements and information.
Such factors include, but are not limited to: fluctuations in the spot and forward price of gold, copper, or certain other commodities (such as silver, diesel fuel, natural gas, and electricity); the speculative nature of mineral exploration and development; changes in mineral production performance, exploitation, and exploration successes; the resumption of operations at the Porgera mine and expected ramp up of mining and processing in 2024; risks associated with projects in the early stages of evaluation, and for which additional engineering and other analysis is required; disruption of supply routes which may cause delays in construction and mining activities, including disruptions in the supply of key mining inputs due to the invasion of Ukraine by Russia and conflicts in the Middle East; whether benefits expected from recent transactions are realized; quantities or grades of reserves will be diminished, and that resources may not be converted to reserves; increased costs, delays, suspensions and technical challenges associated with the construction of capital projects; operating or technical difficulties in connection with mining or development activities, including geotechnical challenges, tailings dam and storage facilities failures, and disruptions in the maintenance or provision of required infrastructure and information technology systems; risks that exploration data may be incomplete and considerable additional work may be required to complete further evaluation, including but not limited to drilling, engineering and socioeconomic studies and investment; failure to comply with environmental and health and safety laws and regulations; increased costs and physical risks, including extreme weather events and resource shortages, related to climate change; timing of, receipt of, or failure to comply with, necessary permits and approvals; non-renewal of key licenses by governmental authorities; uncertainty whether some or all of targeted investments and projects will meet the Company’s capital allocation objectives and internal hurdle rate; the impact of inflation, including global inflationary pressures driven by supply chain disruptions, global energy cost increases following the invasion of Ukraine by Russia and country-specific political and economic factors in Argentina; the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future cash flows; fluctuations in the currency markets; changes in national and local government legislation, taxation, controls or regulations and/or changes in the administration of laws, policies and practices; expropriation or nationalization of property and political or economic developments in Canada, the United States, and other jurisdictions in which the Company or its affiliates do or may carry on business in the future; lack of certainty with respect to foreign legal systems, corruption and other factors that are inconsistent with the rule of law; damage to the Company’s reputation due to the actual or perceived occurrence of any number of events, including negative publicity with respect to the Company’s handling of environmental matters or dealings with community groups, whether true or not; the possibility that future exploration results will not be consistent with the Company’s expectations; risk of loss due to acts of war, terrorism, sabotage and civil disturbances; risks associated with artisanal and illegal mining; risks associated with diseases, epidemics and pandemics, including the effects and potential effects of the global Covid-19 pandemic; litigation and legal and administrative proceedings; contests over title to properties, particularly title to undeveloped properties, or over access to water, power and other required infrastructure; business opportunities that may be presented to, or pursued by, the Company; our ability to successfully integrate acquisitions or complete divestitures; risks associated with working with partners in jointly controlled assets; employee relations including loss of key employees; and availability and increased costs associated with mining inputs and labor. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion, copper cathode or gold or copper concentrate losses (and the risk of inadequate insurance, or inability to obtain insurance, to cover these risks).
Many of these uncertainties and contingencies can affect our actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, us. Readers are cautioned that forward-looking statements are not guarantees of future performance. All of the forward-looking statements made in this press release are qualified by these cautionary statements. Specific reference is made to the most recent Form 40-F/Annual Information Form on file with the SEC and Canadian provincial securities regulatory authorities for a more detailed discussion of some of the factors underlying forward-looking statements and the risks that may affect Barrick’s ability to achieve the expectations set forth in the forward-looking statements contained in this press release.
Barrick disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.
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