Barrick Gold Corporation (NYSE: $GOLD) is a good and copper producer operating 16 sites in 13 countries across North and South America, Africa, and Asia. Established in 1983, Barrick produces over 4 million ounces of gold and 420 pounds of copper annually, making it one of the largest gold mining companies globally.
On March 28, 2024, Barrick Gold Corporation, under the leadership of Chairman John Thornton, celebrated its five-year transformation following its merger with Randgold Resources. Thornton emphasized the company’s evolution into a modern mining business with a global asset base renowned for its quality.
Barrick: Leading Sustainable Global Mining Growth
Reflecting on the past half-decade, Barrick highlighted significant milestones such as revitalizing Tanzanian mines and establishing Nevada Gold Mines, the world’s largest gold mining complex. With operations in 18 countries across four continents, Barrick maintains a solid financial position, enabling it to pursue growth initiatives and capitalize on opportunities worldwide.
Barrick outlined its long-term strategy, placing sustainability at its core. Through innovative partnerships, the company has revitalized mines in Tanzania, revived projects like the Reko Diq in Pakistan, and negotiated the reopening of the Porgera gold mine in Papua New Guinea. These efforts align with Barrick’s commitment to sustainable profitability and responsible mining practices.
Strong Balance Sheet, Diverse Board
Thornton emphasized Barrick’s bolstered balance sheet, which has shifted from significant debt obligations to one of the most resilient in the industry. Operational cash flows allow the company to support organic growth initiatives and capitalize on emerging opportunities. Brett Harvey, the lead director, highlighted Barrick’s dedication to board diversity, with 40% of directors being women from diverse racial or ethnic backgrounds, enhancing the board’s global business expertise.
Barrick Expands DRC Investment for Growth
On March 20, Barrick’s president and chief executive, Mark Bristow, announced plans to invest in new gold and copper opportunities in the Democratic Republic of the Congo (DRC), building on the success of Kibali, Africa’s largest gold mine. Bristow praised Kibali’s transformation of the DRC’s northeast region into an economic frontier and a flourishing commercial hub.
Barrick has invested over $4.6 billion in the DRC since acquiring Kibali in 2011, with payments exceeding $2.4 billion to local contractors and suppliers. The company has also contributed $1.4 billion in royalties, taxes, and permits to the government, $621 million in salaries, and $196 million in infrastructure development and community support.
Kibali aims to implement a 16MW solar plant equipped with batteries by 2025, marking its transition towards renewable energy sources. It will increase the mine’s renewable energy use from 81% to 85%, furthering Barrick’s green energy drive and reducing Kibali’s carbon footprint and costs.
Barrick 2023 Financial Highlights
In the fiscal year of 2023, the company showcased robust financial performance, with reported revenue surging to $11.39 billion, marking a notable increase from the $11.01 billion recorded in 2022. It indicates a solid growth of 3.64%, surpassed analysts’ predictions, and underscored the company’s expansion in production capabilities.
Net earnings also saw a significant upswing, reaching $1,272 million compared to $432 million in 2022, reflecting a remarkable 194% change. Adjusted net earnings stood at $1,467 million, an 11% increase from the prior year.
Operating cash flow reached $3,732 million, up from $3,481 million in the preceding year, primarily due to reduced cash taxes. However, this was offset by a less favorable movement in working capital. Free cash flow surged to $646 million from $432 million in 2022, indicating a 50% change, primarily driven by increased operating cash flows, albeit with higher capital expenditures.
Earnings per share increased substantially, reaching $0.72, a 200% rise from the previous year’s $0.24. Adjusted net earnings per share also saw a notable increase, reaching $0.84 compared to $0.75 in 2022, representing a 12% rise.
Capital expenditures on a cash basis for 2023 totaled $3,086 million, slightly higher than the $3,049 million recorded in the previous year. As of December 31, 2023, cash and equivalents stood at $4,148 million, reflecting a 7% decrease from the $4,440 million recorded in 2022.
Barrick’s 2024 Production Forecast
In its 2024 outlook, Barrick projects its gold output to range between 3.9 and 4.3 million ounces, with all-in-sustaining costs (AISC) anticipated to fall between $1,320 and $1,420 per ounce. Cash costs are forecasted to be between $940 and $1,020 per ounce, while sales costs are expected to range from $1,320 to $1,420 per ounce.
Additionally, Barrick expects to produce 180,000 to 210,000 tons of copper, with AISC ranging from $3.10 to $3.40 per pound and cash costs from $2 to $2.30 per pound. The cost of sales for copper is estimated to be between $2.65 and $2.95 per pound.
For 2024, the total capital expenditure for attributable gold and copper is projected to be between $2,500 and $2,900 million, aligning with Barrick’s overall capital expenditure range for the same period. Moreover, the projected effective tax rate for 2024 is expected to lie within the range of 26% to 30%.
Barrick (GOLD) Stock Update
Barrick Gold’s shares climbed 2.65% on Thursday, closing at $16.64. In the past month, the company’s shares have surged 13.35%. However, they are down 10.39% over the last 52 weeks, with a market cap of $29.213 billion.
In contrast, the S&P500 saw a positive 52-week change of 27.86%. GOLD’s closing price exceeded its 50-day moving average of $15.31. The stock’s 52-week high and low are $20.75 and $13.76, respectively. Barrick Gold Corporation’s forward price-to-earnings ratio stands at 18.98.
Barrick Gold’s Promising Trajectory
Barrick Gold Corporation’s transformative journey under Chairman John Thornton’s leadership has propelled it to new heights, symbolized by its five-year milestone since the merger with Randgold Resources. The company’s strategic initiatives, including mine revitalization, sustainability promotion, and expanded investments in regions like the Democratic Republic of the Congo, demonstrate its commitment to growth and responsible mining practices.
Barrick’s robust performance in 2023 and optimistic projections for 2024 reflect its resilience and potential for further expansion. With analysts bullish on Barrick’s stock and a promising outlook, the company stands poised for continued success in the dynamic global mining landscape.
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