Barrick Makes Solid Start to Year and divivend

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Algemeen advies 06/05/2020 14:20
- All amounts expressed in US dollars
Toronto — Barrick Gold Corporation (NYSE:GOLD)(TSX:ABX) built on the solid foundation it laid last year with a robust first quarter performance from all operations in the face of the challenges presented by the global Covid-19 pandemic.

Q1 gold production and costs were consistent with full year guidance; debt net of cash was reduced by a further 17% from the end of Q4 to $1.85 billion with no significant maturities until 2033; operating cash flow increased to $889 million and free cash flow1 to $438 million from Q4; net earnings per share was 22 cents; adjusted net earnings per share2 was 16 cents; and the quarterly dividend of 7 cents per share was maintained.

Key Performance Indicators
•Solid start to the year from all operations
•Gold production and costs were consistent with full year guidance
•Debt, net of cash, down a further 17% to $1.85 billion with no significant maturities until 2033
•Operating Cash Flow increased to $889 million and Free Cash Flow1 to $438 million from Q4
•Net earnings per share of 22 cents and adjusted net earnings per share2 of 16 cents for the quarter
•Copper costs per pound significantly lower demonstrating resilience of business
•Successful completion of Massawa sale creates value for all stakeholders
•Signing of framework agreement in Tanzania paves way for exporting concentrate
•Continued focus on safety delivers improvements in injury rates
•2019 Annual Report highlights ten-year plan as Barrick looks to next phase of value creation
•Proactive engagement with all stakeholders ensures protection of our people and supports sustainability of the business during Covid-19 pandemic
•Barrick's sustainability vision demonstrated by publication of industry-first ESG scorecard
•Brownfields exploration success points to life of mine extensions
•Global exploration portfolio expanded with new projects and targets
•Barrick declares $0.07 quarterly dividend per share

Financial and Operating Highlights
Financial Results Q1 2020 Q4 2019 Q1 2019
Realized gold price3,4
($ per ounce) 1,589 1,483 1,307
Net earnings5
($ millions) 400 1,387 111
Adjusted net earnings2
($ millions) 285 300 184
Net cash provided by operating
activities ($ millions) 889 875 520
Free cash flow1
($ millions) 438 429 146
Net earnings per share
($) 0.22 0.78 0.06
Adjusted net earnings
per share2 ($) 0.16 0.17 0.11
Total attributable capital
expenditures6 ($ millions) 364 393 361
Operating Results Q1 2020 Q4 2019 Q1 2019

Gold
Production4
(000s of ounces) 1,250 1,439 1,367
Cost of sales (Barrick's share)4,7
($ per ounce) 1,020 1,046 947
Total cash costs4,8
($ per ounce) 692 692 631
All-in sustaining costs4,8
($ per ounce) 954 923 825

Copper
Production9
(millions of pounds) 115 117 106
Cost of sales (Barrick's share)9,10
($ per pound) 1.96 2.26 2.21
C1 cash costs9,11
($ per pound) 1.55 1.90 1.66
All-in sustaining costs9,11
($ per pound) 2.04 2.82 2.46

President and CEO Mark Bristow said operational and financial delivery were on plan despite the fact that the group’s prime focus during the latter part of the quarter had been on ensuring the safety of Barrick’s people, communities and business in the face of the novel coronavirus pandemic, while also coping with the restrictive conditions imposed by governments.

“Our sustainability and regional teams have done a great job in taking timely action to introduce comprehensive and carefully considered measures at all our sites and offices to manage and mitigate any impacts of Covid-19 on our employees and contractors. A key focus of this plan is on prevention, and all sites are working actively to head off an outbreak,” he said.

“In Barrick’s spirit of partnership, we have extended Covid-19 support to our local communities and our host countries and are working closely with their health authorities. To date we have donated more than $20 million to our host countries, many of whom have limited healthcare facilities, to fund the purchase of medical equipment and PPE.”

Highlights of the quarter included the closing of the sale of the Massawa project, which has created immediate value for all stakeholders, including Barrick. In Tanzania, the signing of the framework agreement with the government paved the way for the resumption of concentrate exports.

Brownfields exploration continues to replenish reserves depleted by mining while Barrick’s generative exploration programs are identifying new projects and targets, and expanding its global reach. Among other things, Barrick has formed an alliance with Japan Gold, holder of the largest exploration property portfolio in Japan.

Since the end of the quarter, the government of Papua New Guinea has announced that it will not renew Barrick Niugini Limited’s 20-year Special Mining Lease for the Porgera gold mine. Barrick has said it will contest the move, which it regards as tantamount to nationalization without due process. In the meantime, BNL has placed Porgera on temporary care and maintenance. In addition, due to the uncertainty related to the timing and scope of future developments on the mine’s operating outlook, we are withdrawing our full year 2020 guidance for Porgera at this time. As this is a rapidly evolving situation, we will reassess on an ongoing basis and provide further updates in due course, while maintaining operational readiness.

Bristow said regardless of new discoveries, organic growth from its existing asset base — which includes six Tier One gold mines — would sustain Barrick’s recently published ten-year plan that projects annual production of around five million ounces of gold (subject to adjustment based on the outcome of the process with the Government of Papua New Guinea with respect to the Porgera Special Mining Lease extension). A Tier One gold mine is one which has a life of at least 10 years and produces more than 500,000 ounces of gold per annum in the lower half of the industry cost range.

Barrick has also published an industry-first ESG scorecard to transparently report on its performance in terms of health and safety; social and economic development; human rights; the environment; and governance.

“Overall we scored a B grade, which we believe accurately reflects our improvement in sustainability performance over the year but also acknowledges that there is still some work to be done,” Bristow said.

Conference Call and Webinar

Please join us for an interactive webinar today at 11:00 EDT/15:00 UTC to discuss the results.

Webinar
US and Canada, 1 800 319 4610
UK, 0808 101 2791
International, +1 416 915 3239

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 +1 604 674 8052 (international toll), access code 4363.

Dividend Q1 2020
Toronto — Barrick Gold Corporation (NYSE:GOLD)(TSX:ABX) today announced that its Board of Directors has declared a dividend for the first quarter of 2020 of US $0.07 per share, payable on June 15, 2020, to shareholders of record at the close of business on May 29, 2020.1

Senior executive vice-president and chief financial officer Graham Shuttleworth said that maintaining the dividend level that was increased three times over the last year reflects Barrick’s continued strong financial performance.

“The Board believes that the current dividend level is justified by the group’s profitability, continued reduction in net debt and overall strength of our balance sheet supported by the robust five-year and ten-year plans which we have shared with the market,” said Shuttleworth.



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