At the year’s halfway mark, Barrick Gold Corporation
(NYSE:GOLD)(TSX:ABX) was on track to achieve annual production
within its 2020 guidance range, despite the impact of the Covid-19
pandemic, the company said today.
Second quarter results show year-to-date gold production of 2.4
million ounces, at the mid-point of its 4.6 million to 5 million
ounce annual guidance, driven by strong operating performances,
particularly from Nevada Gold Mines (NGM) in the United States,
Loulo-Gounkoto in Mali and Kibali in the Democratic Republic of
Congo. Barrick’s copper portfolio continued to outperform with
Lumwana in Zambia posting its best quarterly production in
years.
Operating cash flow exceeded $1 billion for the quarter and free
cash flow1 was $522 million. Net earnings per share was 20 cents.
Adjusted net earnings per share2 was 23 cents, up 44% from Q1 and
well ahead of the market consensus, debt net of cash was reduced by
almost 25% to $1.4 billion from the end of Q1, and the quarterly
dividend was increased by 14% to 8 cents per share. The quarterly
dividend has more than doubled since the announcement of the merger
between Barrick and Randgold in September 2018. The non-core asset
disposal strategy, which is ongoing, has so far delivered value of
$1.5 billion of which $1.25 billion was in cash.
Key Performance Indicators
- Continued solid performance positions Barrick well within
annual production guidance, despite Covid-19 challenges
- Improvement in safety management following increased focus
- Strong cash generation highlights quality of assets and
leverage to gold price
- Barrick continues to be vigilant in its approach to contain the
impact of Covid-19
- Higher gold prices also result in higher royalty payments and
costs
- Strong operating performance for copper with costs per pound at
lower end of the guidance range
- Operating Cash Flow in excess of $1.0 billion and Free Cash
Flow1 greater than $0.5 billion for the quarter
- Net debt down almost 25% to $1.4 billion with no significant
maturities until 2033
- Net earnings per share of 20 cents; adjusted net earnings per
share2 up 44% to 23 cents for the quarter
- Strong operating performance from Tier One12 assets, with
Pueblo Viejo production impacted by planned maintenance
shutdown
- Veladero production impacted by Argentina’s Covid-19 movement
and social distancing restrictions
- 30% of stockpiled concentrate shipped from Tanzania and first
$100 million paid to Government
- Agreement reached in Mali to extend the Loulo convention to
2038
- Significant exploration drill results from Nevada, Dominican
Republic, Mali and Tanzania
- Pueblo Viejo expansion, Goldrush development, Turquoise Ridge
shaft and other key projects remain on track despite Covid-19
challenges
- Non-core asset disposal strategy delivers $1.5 billion value
realization, including $1.25 billion in cash, with more to
come
- Barrick increases quarterly dividend by 14% to $0.08 per
share
Financial and Operating
Highlights
|
Financial Results |
Q2 2020 |
Q1 2020 |
Q2 2019 |
| Realized gold price3,4($
per ounce) |
1,725 |
1,589 |
1,317 |
| Net earnings5 ($ millions) |
357 |
400 |
194 |
| Adjusted net earnings2($ millions) |
415 |
285 |
154 |
| Net cash provided by operating activities($ millions) |
1,031 |
889 |
434 |
| Free cash flow1($ millions) |
522 |
438 |
55 |
| Net earnings per share($) |
0.20 |
0.22 |
0.11 |
| Adjusted net earnings per share2($) |
0.23 |
0.16 |
0.09 |
| Attributable capital expenditures6($ millions) |
402 |
364 |
361 |
| Operating
Results |
Q2 2020 |
Q1 2020 |
Q2 2019 |
| Gold |
| Production4(000s of
ounces) |
1,149 |
1,250 |
1,353 |
| Cost of sales (Barrick's share)4,7($ per ounce) |
1,075 |
1,020 |
964 |
| Total cash costs4,8($ per ounce) |
716 |
692 |
651 |
| All-in sustaining costs4,8($ per ounce) |
1,031 |
954 |
869 |
| Copper |
|
|
|
|
Production9 (millions of pounds) |
120 |
115 |
97 |
| Cost of sales (Barrick's share)9,10($ per pound) |
2.08 |
1.96 |
2.04 |
| C1 cash costs8,9($ per pound) |
1.55 |
1.55 |
1.59 |
| All-in sustaining
costs8,9($ per pound) |
2.15 |
2.04 |
2.28 |
President and chief executive Mark Bristow said the strong cash
generation demonstrated the quality of Barrick’s assets,
management’s ability to capture the full benefit of higher gold
prices, effective operational execution and the group’s deft
handling of the Covid-19 pandemic’s impact.
“Our flattened and decentralized management structure was a
major factor in contending with Covid-19 while at the same time
continuing to meet short-term targets and making significant
progress towards our strategic objectives. Our major projects,
including the expansion of Pueblo Viejo, the Goldrush development
and the Turquoise Ridge shaft, remain on track. The only exception
was Veladero, where the heap leach and cross-border Chilean power
line projects were impacted by the Argentine government’s pandemic
quarantine restrictions,” Bristow said.
“We also maintained our strong environmental, social and
governance focus during this difficult period. The Lost Time Injury
Frequency Rate decreased by 15.6% quarter on quarter, and we
further reduced our carbon emissions and continued to improve our
water recycling and reuse performance.”
Dealing with the operations, Bristow said in North America, NGM
led by Cortez trended towards the upper end of its guidance as the
integrated structure allowed the management team to adjust ore
routing through Carlin’s processing facilities in real time, while
at the restructured Hemlo in Canada, exploration was indicating
support for extending the Life of Mine beyond 10 years at a
production profile of around 220,000 ounces per year.
In the Africa and Middle East region, Loulo-Gounkoto and Kibali
were also at the upper end of their guidance. The Tanzanian assets
are still being resuscitated but exports of the stockpiled
concentrate have resumed and the Bulyanhulu underground operation
is being recommissioned. Bristow said between them, North Mara and
Bulyanhulu were capable of producing more than 500,000 ounces
annually for at least 10 years.13
In Latin America, Pueblo Viejo’s production was down as expected
due to a planned plant maintenance shutdown, while production and
costs at Veladero were impacted by a nationwide quarantine and
severe winter weather.
Porgera in Papua New Guinea remains on care and maintenance
while the issue of its Special Mining Lease is before the
court.
Bristow said during the quarter there had been significant
exploration results from Nevada, the Dominican Republic, Mali and
Tanzania, and the expectation was to add significant mineral
resources at most operations this year.
Q2 2020 Results
PresentationWebinar and Conference
Call
President and CEO Mark Bristow will host an interactive webinar
on the results today at 11:00 EDT / 15:00 UTC. The presentation
will be linked to the webinar and conference call.
- Go to the webinar US and Canada (toll-free) 1 800 319 4610 UK
(toll-free) 0808 101 2791 International (toll) +1 416 915 3239
The Q2 2020 presentation materials will be available on
Barrick’s website at www.barrick.com and the webinar will remain on
the website for later viewing.
QUARTERLY DIVIDEND INCREASED BY
14%
Barrick’s Board of Directors has declared a dividend for the
second quarter of 2020 of $0.08 per share, a 14% increase on the
previous quarter’s dividend, payable on September 15, 2020, to
shareholders of record at the close of business on August 31,
2020.14
Senior executive vice-president and chief financial officer
Graham Shuttleworth says that Barrick’s quarterly dividend has more
than doubled since the announcement of the Barrick-Randgold merger
in September 2018, reflecting Barrick’s continued strong financial
performance.
“The Board believes that the dividend increase is sustainable
and reflects the ongoing robust performance of our operations and
continued improvement in the strength of our balance sheet, with
total liquidity of $6.7 billion, including a cash balance of $3.7
billion at the end of the second quarter, and no material debt
repayments due before 2033,” said Shuttleworth.
STRONG STRUCTURE, PARTNERSHIP CULTURE DRIVE PROMPT AND
EFFECTIVE PANDEMIC RESPONSE
A fit-for-purpose management structure coupled with its
deeply embedded health and welfare commitment enabled Barrick to
buffer the impact of the Covid-19 pandemic on its business, people
and communities as well as to provide vital support to its host
governments.
President and chief executive Mark Bristow says the company’s
flattened and regionally devolved management formation provided the
ideal platform for immediate site-appropriate action and swift
engagement with local stakeholders.
“Caring for the wellbeing of our employees and communities is a
key characteristic of the Barrick DNA. Our financial strength,
well-established prevention practices and procedures, and the
experience we gained from dealing with two Ebola pandemics around
our African operations stood us in good stead as we faced this new
and unprecedented challenge,” he says.
“At all our sites, strict access, screening, sanitation and
isolation measures were implemented and through our community
engagement channels, we also took the lead in introducing these
protocols, supported by education programs, to our neighbours. The
provision of rapid antibody testing kits to local clinics and
hospitals was particularly valuable in helping them to manage the
pandemic’s initial onslaught.”
Barrick’s group sustainability executive, Grant Beringer, says
that to date the company has provided more than $20 million in
support to its host communities, much of it in the form of medical
supplies and equipment. In addition, some of its businesses have
prepaid taxes to ease the pandemic’s pressure on their host
countries’ economies.
In the Dominican Republic, Pueblo Viejo prepaid $113 million to
the tax authorities, bringing its total tax payments to the
government to more than $2 billion since 2013. In Mali, the
Loulo-Gounkoto complex made an early tax and royalty payment of $20
million and in Côte d’Ivoire, Tongon prepaid $5 million. In Nevada,
the state legislature has approved an offer by Nevada Gold Mines
(NGM) to prepay net proceeds tax as a Covid-19 relief measure.
Under this arrangement, NGM expects to pay $170 million to the
state by March 2021. In addition, NGM has chosen not to take up the
option of deferring payroll tax payments amounting to $40 million.
Deferral of these payments is allowed under US legislation aimed at
supporting businesses through the pandemic.
“We recognize the importance our tax contribution makes to
Nevada’s economy and NGM is stepping up to support the state at a
time when other businesses there find themselves in financial
distress,” says Bristow.
“In Nevada, as elsewhere in our global operations, our aid has
not been prompted by self-interested commercial considerations, but
by Barrick’s foundational philosophy of partnership, which in this
time of crisis has again demonstrated its value to our
stakeholders.”
Beringer notes that Barrick operates in 12 countries, each with
its own culture and at different stages of economic development.
Consequently, aid was tailored to their particular needs in
consultation with their governments.
“In Latin America, support has been focused on infrastructural
and equipment needs. In Africa, the emphasis has been on improving
existing healthcare facilities and capacity. Where financial
donations were made, we engaged thoroughly with the governments to
identify specific requirements and assisted them in sourcing
equipment and supplies. In the DRC, we converted Kibali’s Ebola
isolation centre into a 100-patient Covid-19 treatment facility
tailored to government guidelines. In North America we sought to
stimulate local economies, for example by donating vouchers to
employees that are only redeemable at stores and service providers
in the local community. NGM has also established a fund to help
local businesses impacted by the pandemic,” he says.
“The commitments our sites made to community investment and
development prior to the Covid-19 outbreak remain intact and are
being fulfilled in conjunction with our pandemic support programs.
These include major projects such as the Durba road in the DRC and
the shift to local contractors and suppliers in Tanzania.”
At the group level, all Barrick’s significant expansion projects
remain on track, with internal teams having been trained to lessen
reliance on external contractors. Among these are the solar power
programs in West Africa and Nevada, the expansion of Pueblo Viejo
in the Dominican Republic, the Bulyanhulu underground project in
Tanzania, and the Goldrush and Turquoise Ridge developments in
Nevada.
TANZANIA MINES FOCUS ON SOCIAL LICENSE AND REBUILDING
MINING OPERATIONS
When Barrick took over the Acacia assets in Tanzania in
September last year, it was faced with a clean-up of Herculean
proportions:
- Relations between the former management and the government as
well as the community had broken down completely.
- North Mara had been closed under an environmental protection
order.
- Bulyanhulu had been overrun by some 20,000 illegal miners and
was no longer operating.
- The government had frozen all concentrate sales as well as the
concentrate containers held under court order at port.
- There were hundreds of longstanding grievances, property
disputes and accusations of human rights abuses at the mines.
- No geological block modelling, mineral resource management or
mine planning had been done at the mines.
- Survey data was significantly incorrect, and capital allocation
as well as executive decision-making were haphazard at best.
The first priority of Africa and Middle East chief operating
officer Willem Jacobs and his team was to regain the trust of the
government, which they did so successfully that the framework
agreement which had been in limbo for years, was swiftly finalized
and signed at a ceremony attended by Tanzanian president John
Magufuli and Barrick president and chief executive Mark Bristow.
This was followed by the establishment of Twiga Minerals
Corporation, a joint venture between Barrick and the government
designed to oversee the management of the mines as well as the
equal sharing of the economic benefits they create.
Greatly assisted by the Twiga board, Barrick and the affected
communities soon agreed on a way forward to settle all the legacy
land claims at North Mara.
Barrick’s DNA was infused into Tanzania with the introduction of
key staff from its Mali operations, after the change of all but two
members of the former management.
Operationally, the team developed and implemented a new tailings
and water management plan for North Mara. The mine could then
resume production and the ban on doré sales was lifted. Getting to
grips with the geology, a new block model that confirmed the
acquisition assumptions and upside, was completed. Ten new
exploration permits around North Mara have also been awarded by the
government.
A study on restarting the Bulyanhulu mine projected the
resumption of underground mining activities at the end of 2020, in
line with guidance. Work on the structural integrity of the
metallurgical plant commenced upon completion of the Acacia
transaction, and refurbishment of the shaft is scheduled to start
in August.
Another study to determine extensions at Buzwagi is underway and
a local content plan has been submitted to the government.
Mark Bristow says enormous progress has been made in fixing the
Tanzanian situation, not least by concentrating on Barrick’s
stakeholder engagement and community relations, with a focus on
building a real social license at what were badly neglected but
world-class assets.
“The foundation has been laid for delivery, and I can see North
Mara and Bulyanhulu together eventually ranking as a Tier One12
complex, with annual production in excess of 500,000 ounces at a
cost in the lower half of the industry curve, well beyond 10
years,” he says.
CORTEZ LEADS THE WAY IN NEVADA
Cortez continues to produce higher than planned ounces
at a lower cost, confirming its status as Nevada Gold Mines’
flagship as well as the leader in the general move from lower grade
open pit operations to higher grade underground
mining.
Its outperformance is being driven by the underground operation,
where improved efficiencies supported mining at higher production
rates. On the back of this performance, the mineral resource
management team has stepped up their game to test for geological
extensions and the potential feeders of the known mineralization
which could significantly extend the Life of Mine, enabling it to
maintain its Tier One status without the assistance of
Goldrush.
During the past quarter, the Goldrush project team was
integrated into the Cortez organization. Development of the
Goldrush declines is ahead of plan and the transition from
contractor to owner operation has been brought forward to 2020. The
underground management team is currently developing operational
readiness for the acceleration of the project, scheduled to expose
first ore in the first half of 2021. Permits are expected in late
2021, paving the way for the start of final construction activities
which Greg Walker, executive general manager, explains will further
ensure the Cortez operations remains a long life, Tier One complex,
one of three such operations in the Nevada Gold Mines
portfolio.
In the meantime, Barrick’s nearby Fourmile project, which has
not yet been included in the Nevada Gold Mines portfolio, has
reported very significant drill results confirming the impressive
high-grade of the mineralization as well as its exciting future
potential.
EXPLORATION MAINTAINS BARRICK’S FOCUS ON THE
FUTURE
Despite the challenges presented by the Covid-19
pandemic, Barrick’s exploration teams have continued to add to the
mineral inventory that is needed to sustain a profitable mining
enterprise.
During the past quarter, there were significant drill results
from all regions. In Nevada, these included the high-grade
intercepts at the Fourmile project, the highest grade ever
intercept at North Leeville and the thick intercepts at Deep
Post.
At Pueblo Viejo, in Dominican Republic, the first structural
model and state-of-the-art geophysics have unlocked a new
generation of targets, and at Loulo 3, in Mali, new intersections
have confirmed that high-grade mineralization is still open down
plunge. Also at Loulo, the high-grade Yalea transfer zone has been
extended 480 metres beyond the 2019 block model and is still open
down plunge. A greater than one-kilometre-long mineralized trend
has been confirmed south of the Gounkoto open pit, also in
Mali.
During the quarter, the exploration teams in Africa and the
Middle East (AME) as well as Latin America (LATAM) were
strengthened with the appointment of senior managers, Aoife McGrath
as vice president exploration for AME and Leandro Sastre as vice
president exploration for LATAM.
McGrath has worked with and led exploration teams in Africa,
North and South America and Europe, and her experience spans the
full spectrum of company size and exploration stages. Named as one
of the ‘Global 100 Inspirational Women in Mining’, she has been
involved in a number of major discoveries and brings strong
commercial skills to her new role.
Sastre was previously mine operations and technical services
manager at Veladero. His wide skills base ranges from exploration
through ore control to resource modelling. He was closely involved
with Exeter’s discovery and delineation of the Caspiche orebody in
Chile, now part of our Norte Abierto project, and the Cerro Moro
orebody in Argentina, which is now an operating mine.
RECRUITING AND DEVELOPING A NEW GENERATION OF
LEADERS
Barrick employs more than 20,000 people along with
another 21,000 contractors in 12 countries across the world, and
its recruitment and development policies are designed to ensure
that they can be the best of the best.
The company has a strong tradition of hiring locally for
operational as well as management roles. In its Africa and Middle
East (AME) region, 76% of management positions are occupied by host
country nationals. In North America (NA) that figure is 88% and in
Latin America and Asia Pacific (LATAM & AP) it is 51%. Last
quarter, only 10 foreign nationals were hired into management
positions across all three regions.
To ensure that its people profile is aligned to societal and
technological changes, Barrick is also driving the employment of
younger candidates as well as women. In the year to date, new hire
percentages under 30 years of age were 50% in AME, 46% in NA and
42% in LATAM & AP.
Mining is traditionally a male-dominated industry and Barrick is
making a determined effort to recruit more women through targeted
campaigns. In NA, 15% of employees are women, and 25% of new hires
so far this year were women. In LATAM & AP, where 11% of all
positions are held by women, hiring rates were 18% in Q1 and 33% in
Q2, reflecting the region’s improving ability to source and employ
women candidates. The AME region has cultural obstacles to the
employment of women, but there too the position is improving, with
new placements up to 10% from a 6% base.
Each region has identified high-potential women for further
career development at all levels of the business. Barrick also has
partnered with leading universities to customize development
programs designed to meet its specific needs.
In NA, 40% of the current participants in Barrick’s Greenfields
Talent Program are women, who spend 12 months working in an
operational environment, then lead a crew for six months as relief
supervisor before taking up their technical positions with Nevada
Gold Mines. The company’s Compass Development Program offers
cross-functional modules ranging from geology through production to
health and safety. Of the current group of participants in this
program, 36% are women. Across AME, Barrick offers apprentice
training leading to artisan status, and in NA, Nevada Gold Mines is
the leading participant in the maintenance training cooperative
program with Great Basin College.
“We want to have the right skills in the right jobs, but we also
want to make sure that we have an appropriately diverse workforce,
and that by investing in young people, we are building a new
generation of leaders to take Barrick into the future,” says
president and chief executive Mark Bristow.
PUEBLO VIEJO AWARDED GOLD SEAL FOR GENDER
EQUALITY
The Gold Seal is the highest level of a new gender equality
certification and it was awarded to Pueblo Viejo (PV) following a
meticulous review by the Dominican Institute for Quality (INDOCAL),
the Dominican Republic’s Ministry of Women and the United Nations
Development Program (UNDP). At the same time, PV was also awarded
the Nordom 775 certification for best practice in gender equality
and equity.
The certifications reflect PV’s commitment to equal rights,
benefits and opportunities for all employees, regardless of gender,
and confirm that its workplace policies align with the United
Nation’s Sustainable Development Goals and the Dominican Republic’s
National Development Strategy with regard to reducing the gender
pay gap and advancing women’s representation in leadership
positions.
Appendix 12020
Operating and Capital Expenditure Guidance
| GOLD PRODUCTION AND COSTS |
|
|
2020 forecastattributable production(000s oz) |
2020 forecast costof sales15 ($/oz) |
2020 forecast totalcash costs8 ($/oz) |
2020 forecast all-insustaining costs8 ($/oz) |
|
Carlin (61.5%)16 |
1,000 - 1,050 |
920 - 970 |
760 - 810 |
1,000 - 1,050 |
|
Cortez (61.5%) |
450 -
480 |
980 -
1,030 |
640 -
690 |
910 -
960 |
|
Turquoise Ridge (61.5%) |
430 -
460 |
900 -
950 |
540 -
590 |
690 -
740 |
|
Phoenix (61.5%) |
100 -
120 |
1,850 -
1,900 |
700 -
750 |
920 -
970 |
|
Long Canyon (61.5%) |
130 -
150 |
910 -
960 |
240 -
290 |
450 -
500 |
|
Nevada Gold Mines (61.5%) |
2,100 - 2,250 |
970 - 1,020 |
660 - 710 |
880 - 930 |
|
Hemlo |
200 -
220 |
960 -
1,010 |
800 -
850 |
1,200 -
1,250 |
| North America |
2,300 - 2,450 |
970 - 1,020 |
660 - 710 |
900 - 950 |
| |
|
|
|
|
|
Pueblo Viejo (60%) |
530 -
580 |
840 -
890 |
520 -
570 |
720 -
770 |
|
Veladero (50%) |
240 -
270 |
1,220 -
1,270 |
670 -
720 |
1,250 -
1,300 |
|
Porgera (47.5%)17 |
|
|
|
|
| Latin America & Asia
Pacific |
800 - 900 |
930 - 980 |
610 - 660 |
890 - 940 |
| |
|
|
|
|
|
Loulo-Gounkoto (80%) |
500 -
540 |
1,050 -
1,100 |
620 -
670 |
970 -
1,020 |
|
Kibali (45%) |
340 -
370 |
1,030 -
1,080 |
600 -
650 |
790 -
840 |
|
North Mara (84%)18 |
240 -
270 |
750 -
800 |
570 -
620 |
830 -
880 |
|
Tongon (89.7%) |
240 -
260 |
1,390 -
1,440 |
680 -
730 |
740 -
790 |
|
Bulyanhulu (84%)18 |
30 -
50 |
1,210 -
1,260 |
790 -
840 |
1,110 -
1,160 |
|
Buzwagi (84%)18 |
80 -
100 |
850 -
900 |
820 -
870 |
850 -
900 |
| Africa & Middle
East |
1,450 - 1,600 |
1,040 - 1,090 |
640 - 690 |
870 - 920 |
| |
|
|
|
|
| Total
Attributable to Barrick18,19,20 |
4,600 - 5,000 |
980 - 1,030 |
650 - 700 |
920 - 970 |
| |
|
|
|
|
| COPPER PRODUCTION AND COSTS |
|
|
2020 forecastattributable production(Mlbs) |
2020 forecast costof sales15 ($/lb) |
2020 forecast C1cash costs11 ($/lb) |
2020 forecast all-insustaining costs11 ($/lb) |
|
Lumwana |
250 - 280 |
2.20 - 2.40 |
1.50 - 1.70 |
2.30 - 2.60 |
|
Zaldívar (50%) |
120 -
135 |
2.40 -
2.70 |
1.65 -
1.85 |
2.30 -
2.60 |
|
Jabal Sayid (50%) |
60 -
70 |
1.75 -
2.00 |
1.40 -
1.60 |
1.50 -
1.70 |
| Total
Copper21 |
440 - 500 |
2.10 - 2.40 |
1.50 - 1.80 |
2.20 - 2.50 |
| |
|
|
|
|
| ATTRIBUTABLE CAPITAL
EXPENDITURES |
|
|
|
|
|
($ millions) |
|
|
|
|
Attributable minesite sustaining |
1,300 - 1,500 |
|
|
|
|
Attributable project |
300 -
400 |
|
|
|
|
Total attributable capital expenditures22 |
1,600 - 1,900 |
|
|
|
2020 Outlook Assumptions and Economic Sensitivity
Analysis23
|
|
2020 GuidanceAssumption |
Hypothetical Change |
Impact on EBITDA(millions)24 |
Impact on AISC8,11 |
| Gold revenue, net of
royalties25 |
$1,350/oz |
+$100/oz |
+$655 |
+$4/oz |
| |
$1,350/oz |
-$100/oz |
-$652 |
-$4/oz |
| Copper revenue, net of
royalties |
$2.75/lb |
+/- $0.50/lb |
+/-$125 |
+/- $0.02/lb |
Appendix 2
Production and Cost Summary – Gold
| |
For the three months
ended |
| |
6/30/20 |
3/31/20 |
% Change |
6/30/19 |
% Change |
|
Nevada Gold Mines LLC (61.5%)a |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
521 |
|
526 |
|
(1 |
) |
% |
526 |
|
(1 |
) |
% |
|
Gold produced (000s oz 100% basis) |
847 |
|
855 |
|
(1 |
) |
% |
548 |
|
55 |
|
% |
|
Cost of sales ($/oz) |
1,055 |
|
995 |
|
6 |
|
% |
842 |
|
25 |
|
% |
|
Total cash costs ($/oz)b |
728 |
|
690 |
|
6 |
|
% |
594 |
|
23 |
|
% |
|
All-in sustaining costs ($/oz)b |
985 |
|
952 |
|
3 |
|
% |
752 |
|
31 |
|
% |
|
Carlin (61.5%)c |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
235 |
|
253 |
|
(7 |
) |
% |
181 |
|
30 |
|
% |
|
Gold produced (000s oz 100% basis) |
382 |
|
411 |
|
(7 |
) |
% |
181 |
|
111 |
|
% |
|
Cost of sales ($/oz) |
1,037 |
|
970 |
|
7 |
|
% |
1,116 |
|
(7 |
) |
% |
|
Total cash costs ($/oz)b |
850 |
|
776 |
|
10 |
|
% |
769 |
|
11 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,130 |
|
1,007 |
|
12 |
|
% |
1,088 |
|
4 |
|
% |
|
Cortez (61.5%)d |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
132 |
|
128 |
|
3 |
|
% |
280 |
|
(53 |
) |
% |
|
Gold produced (000s oz 100% basis) |
215 |
|
208 |
|
3 |
|
% |
280 |
|
(23 |
) |
% |
|
Cost of sales ($/oz) |
870 |
|
876 |
|
(1 |
) |
% |
719 |
|
21 |
|
% |
|
Total cash costs ($/oz)b |
613 |
|
614 |
|
0 |
|
% |
489 |
|
25 |
|
% |
|
All-in sustaining costs ($/oz)b |
950 |
|
1,009 |
|
(6 |
) |
% |
561 |
|
69 |
|
% |
|
Turquoise Ridge (61.5%)e |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
79 |
|
84 |
|
(6 |
) |
% |
65 |
|
22 |
|
% |
|
Gold produced (000s oz 100% basis) |
128 |
|
137 |
|
(6 |
) |
% |
87 |
|
47 |
|
% |
|
Cost of sales ($/oz) |
1,073 |
|
1,032 |
|
4 |
|
% |
665 |
|
61 |
|
% |
|
Total cash costs ($/oz)b |
753 |
|
668 |
|
13 |
|
% |
569 |
|
32 |
|
% |
|
All-in sustaining costs ($/oz)b |
829 |
|
806 |
|
3 |
|
% |
667 |
|
24 |
|
% |
|
Phoenix (61.5%)f |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
35 |
|
35 |
|
0 |
|
% |
|
|
|
Gold produced (000s oz 100% basis) |
57 |
|
57 |
|
0 |
|
% |
|
|
|
Cost of sales ($/oz) |
1,726 |
|
1,583 |
|
9 |
|
% |
|
|
|
Total cash costs ($/oz)b |
725 |
|
737 |
|
(2 |
) |
% |
|
|
|
All-in sustaining costs ($/oz)b |
957 |
|
914 |
|
5 |
|
% |
|
|
|
Long Canyon (61.5%)f |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
40 |
|
26 |
|
54 |
|
% |
|
|
|
Gold produced (000s oz 100% basis) |
65 |
|
42 |
|
54 |
|
% |
|
|
|
Cost of sales ($/oz) |
1,009 |
|
1,025 |
|
(2 |
) |
% |
|
|
|
Total cash costs ($/oz)b |
308 |
|
345 |
|
(11 |
) |
% |
|
|
|
All-in sustaining costs ($/oz)b |
430 |
|
561 |
|
(23 |
) |
% |
|
|
|
Pueblo Viejo (60%) |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
111 |
|
143 |
|
(22 |
) |
% |
124 |
|
(10 |
) |
% |
|
Gold produced (000s oz 100% basis) |
185 |
|
238 |
|
(22 |
) |
% |
207 |
|
(10 |
) |
% |
|
Cost of sales ($/oz) |
935 |
|
767 |
|
22 |
|
% |
852 |
|
10 |
|
% |
|
Total cash costs ($/oz)b |
579 |
|
502 |
|
15 |
|
% |
557 |
|
4 |
|
% |
|
All-in sustaining costs ($/oz)b |
720 |
|
626 |
|
15 |
|
% |
702 |
|
3 |
|
% |
| Loulo-Gounkoto (80%) |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
141 |
|
141 |
|
0 |
% |
|
147 |
|
(4 |
) |
% |
|
Gold produced (000s oz 100% basis) |
176 |
|
|
177 |
|
0 |
% |
184 |
|
(4 |
) |
% |
|
Cost of sales ($/oz) |
1,012 |
|
|
1,002 |
|
1 |
% |
1,072 |
|
(6 |
) |
% |
|
Total cash costs ($/oz)b |
639 |
|
|
614 |
|
4 |
% |
598 |
|
7 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,030 |
|
|
891 |
|
16 |
% |
811 |
|
27 |
|
% |
|
Kibali (45%) |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
90 |
|
|
91 |
(1) |
% |
95 |
|
(5 |
) |
% |
|
Gold produced (000s oz 100% basis) |
201 |
|
|
201 |
(1) |
% |
211 |
|
(5 |
) |
% |
|
Cost of sales ($/oz) |
1,067 |
|
|
1,045 |
2 |
% |
868 |
|
23 |
|
% |
|
Total cash costs ($/oz)b |
617 |
|
|
582 |
6 |
% |
540 |
|
14 |
|
% |
|
All-in sustaining costs ($/oz)b |
739 |
|
|
773 |
(4) |
% |
651 |
|
14 |
|
% |
|
Veladero (50%) |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
49 |
|
|
75 |
(35) |
% |
75 |
|
(35 |
) |
% |
|
Gold produced (000s oz 100% basis) |
98 |
|
|
150 |
(35) |
% |
150 |
|
(35 |
) |
% |
|
Cost of sales ($/oz) |
1,228 |
|
|
1,182 |
4 |
% |
1,186 |
|
4 |
|
% |
|
Total cash costs ($/oz)b |
801 |
|
|
788 |
2 |
% |
746 |
|
7 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,383 |
|
|
1,266 |
9 |
% |
1,046 |
|
32 |
|
% |
|
Porgera (47.5%) |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
24 |
|
|
62 |
(61) |
% |
61 |
|
(61 |
) |
% |
|
Gold produced (000s oz 100% basis) |
51 |
|
|
131 |
(61) |
% |
128 |
|
(61 |
) |
% |
|
Cost of sales ($/oz) |
1,141 |
|
|
1,097 |
4 |
% |
1,032 |
|
11 |
|
% |
|
Total cash costs ($/oz)b |
875 |
|
|
941 |
(7) |
% |
893 |
|
(2 |
) |
% |
|
All-in sustaining costs ($/oz)b |
1,046 |
|
|
1,089 |
(4) |
% |
1,112 |
|
(6 |
) |
% |
|
Tongon (89.7%) |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
64 |
|
|
61 |
5 |
% |
61 |
|
5 |
|
% |
|
Gold produced (000s oz 100% basis) |
71 |
|
|
68 |
5 |
% |
68 |
|
5 |
|
% |
|
Cost of sales ($/oz) |
1,275 |
|
|
1,368 |
(7) |
% |
1,562 |
|
(18 |
) |
% |
|
Total cash costs ($/oz)b |
688 |
|
|
762 |
(10) |
% |
750 |
|
(8 |
) |
% |
|
All-in sustaining costs ($/oz)b |
745 |
|
|
788 |
(5) |
% |
802 |
|
(7 |
) |
% |
|
Hemlo |
|
|
|
|
|
|
Gold produced (000s oz) |
54 |
|
57 |
(5) |
% |
55 |
|
(2 |
) |
% |
|
Cost of sales ($/oz) |
1,268 |
|
|
1,119 |
13 |
% |
953 |
|
33 |
|
% |
|
Total cash costs ($/oz)b |
1,080 |
|
|
945 |
14 |
% |
822 |
|
31 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,456 |
|
|
1,281 |
14 |
% |
1,015 |
|
43 |
|
% |
| North
Mara (84%)g |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
68 |
|
65 |
5 |
% |
76 |
|
(11 |
) |
% |
|
Gold produced (000s oz 100% basis) |
81 |
|
|
77 |
5 |
% |
119 |
|
(32 |
) |
% |
|
Cost of sales ($/oz) |
1,040 |
|
|
959 |
8 |
% |
800 |
|
30 |
|
% |
|
Total cash costs ($/oz)b |
724 |
|
|
646 |
12 |
% |
539 |
|
34 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,166 |
|
|
816 |
43 |
% |
675 |
|
73 |
|
% |
|
Buzwagi (84%)g |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
20 |
|
22 |
(9) |
% |
19 |
|
5 |
|
% |
|
Gold produced (000s oz 100% basis) |
24 |
|
|
27 |
(9) |
% |
30 |
|
(20 |
) |
% |
|
Cost of sales ($/oz) |
909 |
|
|
1,373 |
(34) |
% |
1,198 |
|
(24 |
) |
% |
|
Total cash costs ($/oz)b |
751 |
|
|
1,275 |
(41) |
% |
1,099 |
|
(32 |
) |
% |
|
All-in sustaining costs ($/oz)b |
770 |
|
|
1,288 |
(40) |
% |
1,150 |
|
(33 |
) |
% |
| Bulyanhulu (84%)g |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
7 |
|
7 |
|
0 |
% |
6 |
|
|
17 |
|
% |
|
Gold produced (000s oz 100% basis) |
8 |
|
|
9 |
|
0 |
% |
9 |
|
(11 |
) |
% |
|
Cost of sales ($/oz) |
1,658 |
|
|
1,685 |
|
(2) |
% |
1,217 |
|
36 |
|
% |
|
Total cash costs ($/oz)b |
950 |
|
|
686 |
|
38 |
% |
525 |
|
81 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,014 |
|
|
906 |
|
12 |
% |
666 |
|
52 |
|
% |
| Kalgoorlie
(50%)h |
|
|
|
|
|
|
Gold produced (000s oz attributable basis) |
|
|
|
57 |
|
(100 |
) |
% |
|
Gold produced (000s oz 100% basis) |
|
|
|
114 |
|
(100 |
) |
% |
|
Cost of sales ($/oz) |
|
|
|
1,038 |
|
(100 |
) |
% |
|
Total cash costs ($/oz)b |
|
|
|
846 |
|
(100 |
) |
% |
|
All-in sustaining costs ($/oz)b |
|
|
|
1,204 |
|
(100 |
) |
% |
| Total
Attributable to Barricki |
|
|
|
|
|
|
Gold produced (000s oz) |
1,149 |
|
|
1,250 |
|
(8) |
% |
1,353 |
|
(15 |
) |
% |
|
Cost of sales ($/oz)j |
1,075 |
|
|
1,020 |
|
5 |
% |
964 |
|
12 |
|
% |
|
Total cash costs ($/oz)b |
716 |
|
|
692 |
|
3 |
% |
651 |
|
10 |
|
% |
|
All-in sustaining costs ($/oz)b |
1,031 |
|
|
954 |
|
8 |
% |
869 |
|
19 |
|
% |
a. Represents the combined results of
Cortez, Goldstrike (including our 60% share of South Arturo) and
our 75% interest in Turquoise Ridge until June 30, 2019.
Commencing July 1, 2019, the date Nevada Gold Mines was
established, the results represent our 61.5% interest in Cortez,
Carlin (including Goldstrike and 60% of South Arturo), Turquoise
Ridge (including Twin Creeks), Phoenix and Long Canyon.
b. These are non-GAAP financial
performance measures with no standardized meaning under IFRS and
therefore may not be comparable to similar measures presented by
other issuers. For further information and a detailed
reconciliation of each non-GAAP measure used to the most directly
comparable IFRS measure, please see pages 79 to 103 of our second
quarter MD&A.
c. On July 1, 2019, Barrick's Goldstrike
and Newmont's Carlin were contributed to Nevada Gold Mines and are
now referred to as Carlin. As a result, the amounts presented
represent Goldstrike on a 100% basis (including our 60% share of
South Arturo) up until June 30, 2019, and the combined results of
Carlin and Goldstrike (including NGM's 60% share of South Arturo)
on a 61.5% basis thereafter.
d. On July 1, 2019, Cortez was
contributed to Nevada Gold Mines, a joint venture with
Newmont. As a result, the amounts presented are on an 100%
basis up until June 30, 2019, and on a 61.5% basis
thereafter.
e. Barrick owned 75% of Turquoise Ridge
through to the end of the second quarter of 2019, with our joint
venture partner, Newmont, owning the remaining 25%. Turquoise Ridge
was proportionately consolidated on the basis that the joint
venture partners that have joint control have rights to the assets
and obligations for the liabilities relating to the arrangement.
The figures presented in this table are based on our 75% interest
in Turquoise Ridge until June 30, 2019. On July 1, 2019, Barrick's
75% interest in Turquoise Ridge as well as Newmont's Twin Creeks
and 25% interest in Turquoise Ridge were contributed to Nevada Gold
Mines. Starting July 1, 2019, the results represent our 61.5%
share of Turquoise Ridge and Twin Creeks, now referred to as
Turquoise Ridge.
f. A 61.5% interest in these sites was
acquired as a result of the formation of Nevada Gold Mines on July
1, 2019.
g. Formerly known as Acacia Mining
plc. On September 17, 2019, Barrick acquired all of the
shares of Acacia it did not own. Operating results are
included at 100% from October 1, 2019 to December 31, 2019
(notwithstanding the completion of the Acacia transaction on
September 17, 2019, we consolidated our interest in Acacia and
recorded a non-controlling interest of 36.1% in the income
statement for the entirety of the third quarter of 2019 as a matter
of convenience), and on an 84% basis thereafter as the GoT's 16%
free-carried interest was made effective from January 1, 2020.
h. On November 28, 2019, we completed the
sale of our 50% interest in Kalgoorlie in Western Australia to
Saracen Mineral Holdings Limited for total cash consideration of
$750 million. Accordingly, these represent our 50% interest until
November 28, 2019.
i. Excludes Pierina; Lagunas Norte
starting in the fourth quarter of 2019; and Golden Sunlight and
Morila (40%) starting in the third quarter of 2019 which are
producing incidental ounces as they reach the end of their mine
lives.
j. Cost of sales per ounce
(Barrick’s share) is calculated as gold cost of sales on an
attributable basis (excluding sites in care and maintenance)
divided by gold equity ounces sold.
Production and Cost Summary –
Copper
| |
For the three months
ended |
| |
6/30/20 |
3/31/20 |
% Change |
6/30/19 |
% Change |
|
Lumwana |
|
|
|
|
|
|
Copper production (Mlbs) |
72 |
|
64 |
|
13 |
|
% |
49 |
|
47 |
|
% |
|
Cost of sales ($/lb) |
2.06 |
|
1.94 |
|
6 |
|
% |
2.07 |
|
0 |
|
% |
|
C1 cash costs ($/lb)a |
1.55 |
|
1.63 |
|
(5 |
) |
% |
1.70 |
|
(9 |
) |
% |
|
All-in sustaining costs ($/lb)a |
2.27 |
|
2.26 |
|
0 |
|
% |
2.78 |
|
(18 |
) |
% |
|
Zaldívar
(50%) |
|
|
|
|
|
|
Copper production (Mlbs attributable basis) |
28 |
|
31 |
|
(10 |
) |
% |
32 |
|
(13 |
) |
% |
|
Copper production (Mlbs 100% basis) |
56 |
|
62 |
|
(10 |
) |
% |
64 |
|
(13 |
) |
% |
|
Cost of sales ($/lb) |
2.52 |
|
2.39 |
|
5 |
|
% |
2.32 |
|
9 |
|
% |
|
C1 cash costs ($/lb)a |
1.79 |
|
1.71 |
|
5 |
|
% |
1.61 |
|
11 |
|
% |
|
All-in sustaining costs ($/lb)a |
2.09 |
|
1.99 |
|
5 |
|
% |
1.85 |
|
13 |
|
% |
| Jabal Sayid
(50%) |
|
|
|
|
|
|
Copper production (Mlbs attributable basis) |
20 |
|
20 |
|
0 |
|
% |
16 |
|
25 |
|
% |
|
Copper production (Mlbs 100% basis) |
40 |
|
40 |
|
0 |
|
% |
32 |
|
25 |
|
% |
|
Cost of sales ($/lb) |
1.41 |
|
1.28 |
|
10 |
|
% |
1.45 |
|
(3 |
) |
% |
|
C1 cash costs ($/lb)a |
1.14 |
|
0.97 |
|
18 |
|
% |
1.22 |
|
(7 |
) |
% |
|
All-in sustaining costs ($/lb)a |
1.41 |
|
1.11 |
|
27 |
|
% |
1.31 |
|
8 |
|
% |
| Total
Copper |
|
|
|
|
|
|
Copper production (Mlbs attributable basis) |
120 |
|
115 |
|
4 |
|
% |
97 |
|
24 |
|
% |
|
Cost of sales ($/lb)b |
2.08 |
|
1.96 |
|
6 |
|
% |
2.04 |
|
2 |
|
% |
|
C1 cash costs ($/lb)a |
1.55 |
|
1.55 |
|
0 |
|
% |
1.59 |
|
(3 |
) |
% |
|
All-in sustaining costs ($/lb)a |
2.15 |
|
2.04 |
|
5 |
|
% |
2.28 |
|
(6 |
) |
% |
a. These are non-GAAP financial performance
measures with no standardized meaning under IFRS and therefore may
not be comparable to similar measures presented by other issuers.
For further information and a detailed reconciliation of each
non-GAAP measure used to the most directly comparable IFRS measure,
please see pages 79 to 103 of our second quarter MD&A.
b. Cost of sales per pound (Barrick’s share) is
calculated as copper cost of sales plus our equity share of cost of
sales attributable to Zaldívar and Jabal Sayid divided by copper
pounds sold.
Technical Information
The scientific and technical information
contained in this press release has been reviewed and approved by
Steven Yopps, MMSA, Director - Metallurgy, North America; Craig
Fiddes, SME-RM, Manager – Resource Modeling, Nevada Gold Mines;
Chad Yuhasz, P.Geo, Mineral Resource Manager, Latin America and
Asia Pacific; Simon Bottoms, CGeol, MGeol, FGS, FAusIMM, Mineral
Resources Manager: Africa and Middle East; Rodney Quick, MSc, Pr.
Sci.Nat, Mineral Resource Management and Evaluation Executive; John
Steele, CIM, Metallurgy, Engineering and Capital Projects
Executive; and Rob Krcmarov, FAusIMM, Executive Vice President,
Exploration and Growth – each a “Qualified Person” as defined in
National Instrument 43-101 – Standards of Disclosure for Mineral
Projects.
All mineral reserve and mineral resource
estimates are estimated in accordance with National Instrument
43-101 – Standards of Disclosure for Mineral Projects. Unless
otherwise noted, such mineral reserve and mineral resource
estimates are as of December 31, 2019.
Endnotes
Endnote 1“Free cash flow” is a
non-GAAP financial performance measure which deducts capital
expenditures from net cash provided by operating activities.
Barrick believes this to be a useful indicator of our ability to
operate without reliance on additional borrowing or usage of
existing cash. Free cash flow is intended to provide additional
information only and does not have any standardized meaning under
IFRS and may not be comparable to similar measures of performance
presented by other companies. Free cash flow should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS. Further details on
this non-GAAP measure are provided in the MD&A accompanying
Barrick’s financial statements filed from time to time on SEDAR at
www.sedar.com and on EDGAR at www.sec.gov.
Reconciliation of Net Cash Provided by Operating
Activities to Free Cash Flow
| ($ millions) |
For the three months ended |
For the six months ended |
|
|
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
Net cash provided by operating activities |
1,031 |
|
889 |
|
434 |
|
1,920 |
|
954 |
|
| Capital expenditures |
(509) |
|
(451) |
|
(379) |
|
(960) |
|
(753) |
|
|
Free cash flow |
522 |
|
438 |
|
55 |
|
960 |
|
201 |
|
Endnote 2“Adjusted net
earnings” and “adjusted net earnings per share” are non-GAAP
financial performance measures. Adjusted net earnings excludes the
following from net earnings: certain impairment charges (reversals)
related to intangibles, goodwill, property, plant and equipment,
and investments; gains (losses) and other one-time costs relating
to acquisitions or dispositions; foreign currency translation gains
(losses); significant tax adjustments not related to current period
earnings; unrealized gains (losses) on non-hedge derivative
instruments; and the tax effect and non-controlling interest of
these items. The Company uses this measure internally to evaluate
our underlying operating performance for the reporting periods
presented and to assist with the planning and forecasting of future
operating results. Barrick believes that adjusted net earnings is a
useful measure of our performance because these adjusting items do
not reflect the underlying operating performance of our core mining
business and are not necessarily indicative of future operating
results. Adjusted net earnings and adjusted net earnings per share
are intended to provide additional information only and do not have
any standardized meaning under IFRS and may not be comparable to
similar measures of performance presented by other companies. They
should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. Further
details on these non-GAAP measures are provided in the MD&A
accompanying Barrick’s financial statements filed from time to time
on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
Reconciliation of Net Earnings to Net Earnings per
Share, Adjusted Net Earnings and Adjusted Net Earnings per
Share
| ($ millions, except per share
amounts in dollars) |
For the three months ended |
For the six months ended |
|
|
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
Net earnings attributable to equity holders of the Company |
357 |
|
400 |
|
194 |
|
757 |
|
305 |
|
| Impairment charges (reversals)
related to intangibles, goodwill, property, plant and equipment,
and investmentsa |
23 |
|
(336) |
|
12 |
|
(313) |
|
15 |
|
| Acquisition/disposition
(gains) lossesb |
8 |
|
(60) |
|
(12) |
|
(52) |
|
(12) |
|
| Loss (gain) on currency
translation |
2 |
|
16 |
|
(6) |
|
18 |
|
16 |
|
| Significant tax adjustmentsc |
(7) |
|
(44) |
|
(83) |
|
(51) |
|
(75) |
|
| Other expense adjustmentsd |
48 |
|
98 |
|
58 |
|
146 |
|
104 |
|
| Tax effect and non-controlling
intereste |
(16) |
|
211 |
|
(9) |
|
195 |
|
(15) |
|
|
Adjusted net earnings |
415 |
|
285 |
|
154 |
|
700 |
|
338 |
|
|
Net earnings per sharef |
0.20 |
|
0.22 |
|
0.11 |
|
0.43 |
|
0.17 |
|
|
Adjusted net earnings per sharef |
0.23 |
|
0.16 |
|
0.09 |
|
0.39 |
|
0.19 |
|
- Net impairment charges for the three month period ended June
30, 2020 relate to miscellaneous assets. For the three month
period ended March 31, 2020 and the six month period ended June 30,
2020, net impairment reversals primarily relate to non-current
asset reversals at our Tanzanian assets.
- Acquisition/disposition gains for the three month period ended
March 31, 2020 and the six month period ended June 30, 2020
primarily relate to the gain on the sale of Massawa.
- Significant tax adjustments for the three month period ended
March 31, 2020 and the six month period ended June 30, 2020
primarily relate to deferred tax recoveries as a result of tax
reform measures in Argentina and adjustments made in recognition of
the net settlement of all outstanding disputes with the GoT.
For the three and six month periods ended June 30, 2019,
significant tax adjustments primarily relate to an adjustment to
deferred taxes at Veladero. Refer to Note 10 to the Financial
Statements for more information.
- Other expense adjustments for the three and six month period
ended June 30, 2020 primarily relate to care and maintenance
expenses at Porgera and Covid-19 donations. The six month
period ended June 30, 2020 was further impacted by changes in the
discount rate assumptions on our closed mine rehabilitation
provision. For the three month period ended March 31, 2020,
other expense adjustments primarily relate to the impact of changes
in the discount rate assumptions on our closed mine rehabilitation
provision and losses on debt extinguishment. Other expense
adjustments for the three and six month periods ended June 30, 2019
primarily relate to severance costs as a result of the
implementation of a number of organizational reductions, the impact
of changes in the discount rate assumptions on our closed mine
rehabilitation provision and transaction costs related to Nevada
Gold Mines.
- Tax effect and non-controlling interest for the three month
periods ended March 31, 2020 and December 31, 2019 primarily
relates to the net impairment reversals related to long-lived
assets.
- Calculated using weighted average number of shares outstanding
under the basic method of earnings per share.
Endnote 3"Realized price" is a
non-GAAP financial measure which excludes from sales: unrealized
gains and losses on non-hedge derivative contracts; unrealized
mark-to-market gains and losses on provisional pricing from copper
and gold sales contracts; sales attributable to ore purchase
arrangements; treatment and refining charges; export duties; and
cumulative catch-up adjustments to revenue relating to our
streaming arrangements. This measure is intended to enable
Management to better understand the price realized in each
reporting period for gold and copper sales because unrealized
mark-to-market values of non-hedge gold and copper derivatives are
subject to change each period due to changes in market factors such
as market and forward gold and copper prices, so that prices
ultimately realized may differ from those recorded. The exclusion
of such unrealized mark-to-market gains and losses from the
presentation of this performance measure enables investors to
understand performance based on the realized proceeds of selling
gold and copper production. The realized price measure is intended
to provide additional information and does not have any
standardized definition under IFRS and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS. Further details on these non-GAAP measures
are provided in the MD&A accompanying Barrick’s financial
statements filed from time to time on SEDAR at www.sedar.com and on
EDGAR at www.sec.gov.
Reconciliation of Sales to Realized
Price per ounce/pound
|
($ millions, except per ounce/pound information in dollars) |
Gold |
Copper |
Gold |
Copper |
|
|
For the three months ended |
For the six months ended |
|
|
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
Sales |
2,812 |
|
2,593 |
|
1,937 |
|
184 |
|
99 |
|
103 |
|
5,405 |
|
3,843 |
|
283 |
|
266 |
|
| Sales applicable to
non-controlling interests |
(822) |
|
(770) |
|
(240) |
|
0 |
|
0 |
|
0 |
|
(1,592) |
|
(464) |
|
0 |
|
0 |
|
| Sales applicable to equity
method investmentsa,b |
172 |
|
147 |
|
135 |
|
120 |
|
107 |
|
124 |
|
319 |
|
264 |
|
227 |
|
245 |
|
| Realized non-hedge gold/copper
derivative (losses) gains |
0 |
|
0 |
|
1 |
|
0 |
|
0 |
|
0 |
|
0 |
|
1 |
|
0 |
|
0 |
|
| Sales applicable to sites in
care and maintenancec |
(53) |
|
(46) |
|
(26) |
|
0 |
|
0 |
|
0 |
|
(99) |
|
(52) |
|
0 |
|
0 |
|
| Treatment and refinement
charges |
2 |
|
0 |
|
0 |
|
40 |
|
39 |
|
25 |
|
2 |
|
0 |
|
79 |
|
56 |
|
| Otherd |
0 |
|
15 |
|
0 |
|
0 |
|
0 |
|
0 |
|
15 |
|
0 |
|
0 |
|
0 |
|
|
Revenues – as adjusted |
2,111 |
|
1,939 |
|
1,807 |
|
344 |
|
245 |
|
252 |
|
4,050 |
|
3,592 |
|
589 |
|
567 |
|
|
Ounces/pounds sold (000s ounces/millions pounds)c |
1,224 |
|
1,220 |
|
1,372 |
|
123 |
|
110 |
|
96 |
|
2,444 |
|
2,737 |
|
233 |
|
199 |
|
|
Realized gold/copper price per ounce/pounde |
1,725 |
|
1,589 |
|
1,317 |
|
2.79 |
|
2.23 |
|
2.62 |
|
1,657 |
|
1,312 |
|
2.53 |
|
2.85 |
|
- Represents sales of $164 million and $304 million,
respectively, for the three and six month periods ended
June 30, 2020 (March 31, 2020: $140 million and
June 30, 2019: $125 million and $242 million, respectively)
applicable to our 45% equity method investment in Kibali and $nil
and nil, respectively, (March 31, 2020: $nil and June 30,
2019: $10 million and $22 million, respectively) applicable to our
40% equity method investment in Morila for gold. Represents sales
of $78 million and $150 million, respectively, for the three and
six months ended June 30, 2020 (March 31, 2020: $72
million and June 30, 2019: $86 million and $167 million,
respectively) applicable to our 50% equity method investment in
Zaldívar and $46 million and $86 million, respectively
(March 31, 2020: $40 million and June 30, 2019: $44
million and $88 million, respectively) applicable to our 50% equity
method investment in Jabal Sayid for copper.
- Sales applicable to equity method investments are net of
treatment and refinement charges.
- Figures exclude: Pierina; Golden Sunlight and Morila starting
in the third quarter of 2019; and Lagunas Norte starting in the
fourth quarter of 2019, from the calculation of realized price per
ounce as the mine is mining incidental ounces as it enters
closure.
- Represents cumulative catch-up adjustment to revenue relating
to our streaming arrangements. Refer to note 2f of the 2019
Annual Financial Statements for more information.
- Realized price per ounce/pound may not calculate based on
amounts presented in this table due to rounding.
Endnote 4Includes North Mara,
Bulyanhulu and Buzwagi on a 84% basis starting January 1, 2020 (and
on a 63.9% basis from January 1, 2019 to September 30, 2019;
notwithstanding the completion of the Acacia transaction on
September 17, 2019, we consolidated our interest in Acacia and
recorded a non-controlling interest of 36.1% in the income
statement for the entirety of the third quarter of 2019 as a matter
of convenience, and on a 100% basis from October 1, 2019 to
December 31, 2019), Pueblo Viejo on a 60% basis, South Arturo on a
36.9% basis from July 1, 2019 onwards as a result of its
contribution to Nevada Gold Mines (and on a 60% basis from January
1, 2019 to June 30, 2019), Veladero on a 50% basis, Loulo-Gounkoto
on an 80% basis, Kibali on a 45% basis, Tongon on an 89.7% basis,
and Morila on a 40% basis until the second quarter of 2019, which
reflects our equity share of production and sales. Also
removes the non-controlling interest of 38.5% Nevada Gold Mines
from July 1, 2019 onwards.
Endnote 5Net earnings (loss)
represents net earnings (loss) attributable to the equity holders
of the Company.
Endnote 6These amounts are
presented on the same basis as our guidance and include our 60%
share of Pueblo Viejo, 80% share of Loulo-Gounkoto, 89.7% share of
Tongon, 45% share of Kibali, 40% share of Morila and 60% share of
South Arturo (36.9% of South Arturo from July 1, 2019 onwards as a
result of its contribution to Nevada Gold Mines), our 84% share of
Tanzania starting January 1, 2020 (63.9% share from January 1, 2019
to September 30, 2019; notwithstanding the completion of the Acacia
transaction on September 17, 2019, we consolidated our interest in
Acacia and recorded a non-controlling interest of 36.1% in the
income statement for the entirety of the third quarter of 2019 as a
matter of convenience, and 100% share from October 1, 2019 to
December 31, 2019) and our 50% share of Zaldívar and Jabal
Sayid. Starting July 1, 2019, it also includes our 61.5%
share of Nevada Gold Mines.
Endnote 7Gold cost of sales
(Barrick’s share) is calculated as cost of sales - gold on an
attributable basis (excluding sites in care and maintenance)
divided by ounces sold.
Endnote 8“Total cash costs” per
ounce, “All-in sustaining costs” per ounce and "All-in costs" per
ounce are non-GAAP financial performance measures. “Total cash
costs” per ounce starts with cost of sales related to gold
production but removes depreciation, the noncontrolling interest of
cost of sales, and includes by product credits. “All-in sustaining
costs” per ounce begin with “Total cash costs” per ounce and add
further costs which reflect the expenditures made to maintain
current production levels, primarily sustaining capital
expenditures, sustaining leases, general & administrative
costs, minesite exploration and evaluation costs, and reclamation
cost accretion and amortization. "All-in costs" per ounce starts
with "All-in sustaining costs" per ounce and adds additional costs
that reflect the varying costs of producing gold over the
life-cycle of a mine, including: project capital expenditures and
other nonsustaining costs. Barrick believes that the use of “total
cash costs” per ounce, “all-in sustaining costs” per ounce and
"All-in costs" per ounce will assist investors, analysts and other
stakeholders 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. “Total cash costs” per ounce, “All-in
sustaining costs” per ounce and "All-in costs" per ounce are
intended to provide additional information only and do not have any
standardized meaning under IFRS. Although a standardized definition
of all-in sustaining costs was published in 2013 by the World Gold
Council (a market development organization for the gold industry
comprised of and funded by 25 gold mining companies from around the
world, including Barrick), it is not a regulatory organization, and
other companies may calculate this measure differently. Starting
from the first quarter of 2019, we have renamed "cash costs" to
"total cash costs" when referring to our gold operations. The
calculation of total cash costs is identical to our previous
calculation of cash costs with only a change in the naming
convention of this non-GAAP measure. These measures should not be
considered in isolation or as a substitute for measures prepared in
accordance with IFRS. Further details on these non-GAAP measures
are provided in the MD&A accompanying Barrick’s financial
statements filed from time to time on SEDAR at www.sedar.com and on
EDGAR at www.sec.gov.
Reconciliation of Gold Cost of Sales to Total cash
costs, All-in sustaining costs and All-in costs, including on a per
ounce basis
| ($ millions, except per ounce
information in dollars) |
|
For the three months ended |
For the six months ended |
|
|
Footnote |
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
Cost of sales applicable to gold production |
|
1,740 |
|
1,643 |
|
1,437 |
|
3,383 |
|
2,787 |
|
|
Depreciation |
|
(498) |
|
(474) |
|
(431) |
|
(972) |
|
(815) |
|
|
Cash cost of sales applicable to equity method investments |
|
62 |
|
52 |
|
62 |
|
114 |
|
124 |
|
|
By-product credits |
|
(59) |
|
(29) |
|
(23) |
|
(88) |
|
(47) |
|
|
Realized (gains) losses on hedge and non-hedge derivatives |
a |
1 |
|
0 |
|
(1) |
|
1 |
|
(1) |
|
|
Non-recurring items |
b |
0 |
|
0 |
|
(9) |
|
0 |
|
(29) |
|
|
Other |
c |
(26) |
|
(27) |
|
(26) |
|
(53) |
|
(46) |
|
|
Non-controlling interests |
d |
(336) |
|
(316) |
|
(112) |
|
(652) |
|
(213) |
|
|
Total cash costs |
|
884 |
|
849 |
|
897 |
|
1,733 |
|
1,760 |
|
|
General & administrative costs |
|
71 |
|
40 |
|
59 |
|
111 |
|
113 |
|
|
Minesite exploration and evaluation costs |
e |
23 |
|
15 |
|
12 |
|
38 |
|
23 |
|
|
Minesite sustaining capital expenditures |
f |
420 |
|
370 |
|
267 |
|
790 |
|
520 |
|
|
Sustaining leases |
|
10 |
|
0 |
|
8 |
|
10 |
|
18 |
|
|
Rehabilitation - accretion and amortization (operating sites) |
g |
12 |
|
14 |
|
16 |
|
26 |
|
30 |
|
|
Non-controlling interest, copper operations and other |
h |
(158) |
|
(125) |
|
(76) |
|
(283) |
|
(151) |
|
|
All-in sustaining costs |
|
1,262 |
|
1,163 |
|
1,183 |
|
2,425 |
|
2,313 |
|
|
Project exploration and evaluation and project costs |
e |
55 |
|
56 |
|
86 |
|
111 |
|
149 |
|
|
Community relations costs not related to current operations |
|
0 |
|
1 |
|
0 |
|
1 |
|
1 |
|
|
Project capital expenditures |
f |
85 |
|
76 |
|
108 |
|
161 |
|
228 |
|
|
Rehabilitation - accretion and amortization (non-operating
sites) |
g |
4 |
|
2 |
|
7 |
|
6 |
|
14 |
|
|
Non-controlling interest and copper operations and other |
h |
(36) |
|
(17) |
|
(28) |
|
(53) |
|
(31) |
|
|
All-in costs |
|
1,370 |
|
1,281 |
|
1,356 |
|
2,651 |
|
2,674 |
|
|
Ounces sold - equity basis (000s ounces) |
i |
1,224 |
|
1,220 |
|
1,372 |
|
2,444 |
|
2,737 |
|
|
Cost of sales per ounce |
j,k |
1,075 |
|
1,020 |
|
964 |
|
1,048 |
|
956 |
|
|
Total cash costs per ounce |
k |
716 |
|
692 |
|
651 |
|
704 |
|
641 |
|
| Total cash costs per ounce (on
a co-product basis) |
k,l |
747 |
|
705 |
|
663 |
|
726 |
|
654 |
|
|
All-in sustaining costs per ounce |
k |
1,031 |
|
954 |
|
869 |
|
993 |
|
842 |
|
| All-in sustaining costs per
ounce (on a co-product basis) |
k,l |
1,062 |
|
967 |
|
881 |
|
1,015 |
|
855 |
|
|
All-in costs per ounce |
k |
1,118 |
|
1,052 |
|
999 |
|
1,085 |
|
976 |
|
| All-in
costs per ounce (on a co-product basis) |
k,l |
1,149 |
|
1,065 |
|
1,011 |
|
1,107 |
|
989 |
|
a. Realized (gains) losses on hedge and non-hedge
derivativesIncludes realized hedge losses of $nil and
$nil, respectively, for the three and six month periods ended
June 30, 2020 (March 31, 2020: $nil and June 30,
2019: $nil and $nil, respectively), and realized non-hedge losses
of $1 million and $1 million, respectively, for the three and six
month periods ended June 30, 2020 (March 31, 2020: $nil
and June 30, 2019: gains of $1 million and $1 million,
respectively). Refer to note 5 to the Financial Statements for
further information.
b. Non-recurring itemsNon-recurring items in
2019 relate to organizational restructuring. These costs are
not indicative of our cost of production and have been excluded
from the calculation of total cash costs.
c. OtherOther adjustments for the three and six
month period ended June 30, 2020 include the removal of total
cash costs and by-product credits associated with: our Pierina
mine; Golden Sunlight and Morila starting in the third quarter of
2019; and Lagunas Norte starting in the fourth quarter of 2019,
which all are mining incidental ounces as they enter closure of $26
million and $51 million, respectively, (March 31, 2020: $25
million; June 30, 2019: $19 million and $37 million,
respectively, relating to Pierina only).
d. Non-controlling interestsNon-controlling
interests include non-controlling interests related to gold
production of $495 million and $961 million, respectively, for the
three and six month periods ended June 30, 2020
(March 31, 2020: $466 million and June 30, 2019: $171
million and $323 million, respectively). Non-controlling interests
include Pueblo Viejo, Loulo-Gounkoto, Tongon, North Mara,
Bulyanhulu, Buzwagi (notwithstanding the completion of the Acacia
transaction on September 17, 2019, we consolidated our interest in
Acacia and recorded a non-controlling interest of 36.1% in the
income statement for the entirety of the third quarter of 2019 as a
matter of convenience) and Nevada Gold Mines starting July 1, 2019.
Refer to note 5 to the Financial Statements for further
information.
e. Exploration and evaluation costs
Exploration, evaluation and project expenses are
presented as minesite sustaining if it supports current mine
operations and project if it relates to future projects. Refer to
page 72 of the second quarter MD&A.
f. Capital expenditures Capital
expenditures are related to our gold sites only and are split
between minesite sustaining and project capital expenditures.
Project capital expenditures are distinct projects designed to
increase the net present value of the mine and are not related to
current production. Significant projects in the current year are
the expansion project at Pueblo Viejo, the Goldrush exploration
declines, the restart of mining activities at Bulyanhulu, and
construction of the third shaft at Turquoise Ridge. Refer to page
71 of the second quarter MD&A.
g. Rehabilitation—accretion and
amortizationIncludes depreciation on the assets related to
rehabilitation provisions of our gold operations and accretion on
the rehabilitation provision of our gold operations, split between
operating and non-operating sites.
h. Non-controlling interest and copper
operations Removes general &
administrative costs related to non-controlling interests and
copper based on a percentage allocation of revenue. Also removes
exploration, evaluation and project expenses, rehabilitation costs
and capital expenditures incurred by our copper sites and the
non-controlling interest of North Mara, Bulyanhulu and Buzwagi
(notwithstanding the completion of the Acacia transaction on
September 17, 2019, we consolidated our interest in Acacia and
recorded a non-controlling interest of 36.1% in the income
statement for the entirety of the third quarter of 2019 as a matter
of convenience), Pueblo Viejo, Loulo-Gounkoto and Tongon operating
segments and South Arturo (63.1% of South Arturo from July 1, 2019
onwards as a result of its contribution to Nevada Gold Mines). Also
removes the non-controlling interest of Nevada Gold Mines starting
July 1, 2019. It also includes capital expenditures
applicable to equity method investments. Figures remove the impact
of Pierina; Golden Sunlight and Morila starting in the third
quarter of 2019; and Lagunas Norte starting in the fourth quarter
of 2019. The impact is summarized as the following:
| ($ millions) |
For the three months ended |
For the six months ended |
|
Non-controlling interest, copper operations and other |
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
General & administrative costs |
(8) |
|
(6) |
|
(23) |
|
(14) |
|
(33) |
|
| Minesite exploration and
evaluation expenses |
(8) |
|
(3) |
|
0 |
|
(11) |
|
(1) |
|
| Rehabilitation - accretion and
amortization (operating sites) |
(4) |
|
(4) |
|
(1) |
|
(8) |
|
(2) |
|
| Minesite sustaining capital
expenditures |
(138) |
|
(112) |
|
(52) |
|
(250) |
|
(115) |
|
|
All-in sustaining costs total |
(158) |
|
(125) |
|
(76) |
|
(283) |
|
(151) |
|
|
Project exploration and evaluation and project costs |
(9) |
|
(3) |
|
(26) |
|
(12) |
|
(28) |
|
| Project capital expenditures |
(27) |
|
(14) |
|
(2) |
|
(41) |
|
(3) |
|
|
All-in costs total |
(36) |
|
(17) |
|
(28) |
|
(53) |
|
(31) |
|
i. Ounces sold - equity basisFigures
remove the impact of: Pierina; Golden Sunlight and Morila starting
in the third quarter of 2019; and Lagunas Norte starting in the
fourth quarter of 2019, which are producing incidental ounces as
they reach the end of their mine lives.
j. Cost of sales per ounceFigures remove
the cost of sales impact of: Pierina of $4 million and $10 million,
respectively, for the three and six month periods ended
June 30, 2020 (March 31, 2020: $6 million and
June 30, 2019: $44 million and $71 million, respectively);
starting in the third quarter of 2019, Golden Sunlight of $nil and
$nil, respectively, for the three and six month periods ended
June 30, 2020 (March 31, 2020: $nil and June 30,
2019: $nil and $nil, respectively) and Morila of $8 million and $14
million, respectively, for the three and six month periods ended
June 30, 2020 (March 31, 2020: $6 million and
June 30, 2019: $nil and $nil, respectively); and starting in
the fourth quarter of 2019, Lagunas Norte of $23 million and $43
million, respectively, for the three and six month periods ended
June 30, 2020 (March 31, 2020: $21 million and
June 30, 2019: $nil and $nil, respectively), which are mining
incidental ounces as these sites enter closure. Cost of sales per
ounce excludes non-controlling interest related to gold production.
Cost of sales applicable to gold per ounce is calculated using cost
of sales on an attributable basis (removing the non-controlling
interest of 40% Pueblo Viejo, 20% of Loulo-Gounkoto, 10.3% of
Tongon, 16% North Mara, Bulyanhulu and Buzwagi starting January 1,
2020, the effective date of the GoT's free carried interest (36.1%
up until September 30, 2019; notwithstanding the completion of the
Acacia transaction on September 17, 2019, we consolidated our
interest in Acacia and recorded a non-controlling interest of 36.1%
in the income statement for the entirety of the third quarter of
2019 as a matter of convenience) and 40% South Arturo from cost of
sales (63.1% of South Arturo from July 1, 2019 onwards as a result
of its contribution to Nevada Gold Mines)), divided by attributable
gold ounces. The non-controlling interest of 38.5% Nevada Gold
Mines is also removed from cost of sales from July 1, 2019
onwards.
k. Per ounce figures Cost of sales
per ounce, total cash costs per ounce, all-in sustaining costs per
ounce and all-in costs per ounce may not calculate based on amounts
presented in this table due to rounding.
l. Co-product costs per ounce Total
cash costs per ounce, all-in sustaining costs per ounce and all-in
costs per ounce presented on a co-product basis removes the impact
of by-product credits of our gold production (net of
non-controlling interest) calculated as:
| ($ millions) |
For the three months ended |
For the six months ended |
|
|
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
By-product credits |
59 |
|
29 |
|
23 |
|
88 |
|
47 |
|
| Non-controlling
interest |
(22) |
|
(15) |
|
(7) |
|
(37) |
|
(15) |
|
|
By-product credits (net of non-controlling interest) |
37 |
|
14 |
|
16 |
|
51 |
|
32 |
|
Endnote 9Amounts reflect
production and sales from Jabal Sayid and Zaldívar on a 50% basis,
which reflects our equity share of production, and Lumwana.
Endnote 10
Copper cost of sales (Barrick’s share) is
calculated as cost of sales - copper plus our equity share of cost
of sales attributable to Zaldívar and Jabal Sayid divided by pounds
sold.
Endnote 11“C1 cash costs” per
pound and “All-in sustaining costs” per pound are non-GAAP
financial performance measures. “C1 cash costs” per pound is based
on cost of sales but excludes the impact of depreciation and
royalties and production taxes and includes treatment and
refinement charges. “All-in sustaining costs” per pound begins with
“C1 cash costs” per pound and adds further costs which reflect the
additional costs of operating a mine, primarily sustaining capital
expenditures, general & administrative costs and royalties and
production taxes. Barrick believes that the use of “C1 cash costs”
per pound and “all-in sustaining costs” per pound will assist
investors, analysts, and other stakeholders in understanding the
costs associated with producing copper, understanding the economics
of copper 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. “C1 cash
costs” per pound and “All-in sustaining costs” per pound are
intended to provide additional information only, do not have any
standardized meaning under IFRS, and may not be comparable to
similar measures of performance presented by other companies. These
measures should not be considered in isolation or as a substitute
for measures of performance prepared in accordance with IFRS.
Further details on these non-GAAP measures are provided in the
MD&A accompanying Barrick’s financial statements filed from
time to time on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov.
Reconciliation of Copper Cost of Sales
to C1 cash costs and All-in sustaining costs, including on a per
pound basis
| ($ millions, except per pound
information in dollars) |
For the three months ended |
For the six months ended |
|
|
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
Cost of sales |
153 |
|
124 |
|
101 |
|
277 |
|
232 |
|
|
Depreciation/amortization |
(63) |
|
(43) |
|
(28) |
|
(106) |
|
(70) |
|
|
Treatment and refinement charges |
40 |
|
39 |
|
25 |
|
79 |
|
56 |
|
|
Cash cost of sales applicable to equity method investments |
72 |
|
66 |
|
69 |
|
138 |
|
135 |
|
|
Less: royalties and production taxesa |
(11) |
|
(11) |
|
(9) |
|
(22) |
|
(21) |
|
|
By-product credits |
(3) |
|
(3) |
|
(2) |
|
(6) |
|
(5) |
|
|
Other |
0 |
|
0 |
|
(5) |
|
0 |
|
(5) |
|
|
C1 cash costs |
188 |
|
172 |
|
151 |
|
360 |
|
322 |
|
|
General & administrative costs |
6 |
|
3 |
|
6 |
|
9 |
|
11 |
|
|
Rehabilitation - accretion and amortization |
2 |
|
3 |
|
3 |
|
5 |
|
6 |
|
|
Royalties and production taxesa |
11 |
|
11 |
|
9 |
|
22 |
|
21 |
|
|
Minesite exploration and evaluation costs |
1 |
|
1 |
|
1 |
|
2 |
|
3 |
|
|
Minesite sustaining capital expenditures |
52 |
|
32 |
|
48 |
|
84 |
|
107 |
|
|
Sustaining leases |
2 |
|
3 |
|
1 |
|
5 |
|
2 |
|
|
All-in sustaining costs |
262 |
|
225 |
|
219 |
|
487 |
|
472 |
|
|
Pounds sold - consolidated basis (millions pounds) |
123 |
|
110 |
|
96 |
|
233 |
|
199 |
|
|
Cost of sales per poundb,c |
2.08 |
|
1.96 |
|
2.04 |
|
2.03 |
|
2.13 |
|
|
C1 cash cost per poundb |
1.55 |
|
1.55 |
|
1.59 |
|
1.55 |
|
1.62 |
|
|
All-in sustaining costs per poundb |
2.15 |
|
2.04 |
|
2.28 |
|
2.10 |
|
2.37 |
|
- For the three and six month period ended June 30, 2020,
royalties and production taxes include royalties of $11 million and
$22 million respectively (March 31, 2020: $11 million
and June 30, 2019: $9 million and $21 million
respectively).
- Cost of sales per pound, C1 cash costs per pound and all-in
sustaining costs per pound may not calculate based on amounts
presented in this table due to rounding.
- Cost of sales applicable to copper per pound is calculated
using cost of sales including our proportionate share of cost of
sales attributable to equity method investments (Zaldívar and Jabal
Sayid), divided by consolidated copper pounds (including our
proportionate share of copper pounds from our equity method
investments).
Endnote 12Barrick defines a
Tier One mine as one that produces in excess of 500,000 ounces of
gold per annum and has a life of at least 10 years.Endnote
13On a 100% basis and pending completion of updated
feasibility studies at Bulyanhulu.
Endnote 14The declaration and
payment of dividends is at the discretion of the Board of
Directors, and will depend on the company’s financial results, cash
requirements, future prospects and other factors deemed relevant by
the Board.
Endnote 15Cost of sales
applicable to gold per ounce is calculated using cost of sales
applicable to gold on an attributable basis (removing the
non-controlling interest of 40% Pueblo Viejo; 20% Loulo-Gounkoto;
10.3% Tongon; 16% North Mara, Bulyanhulu and Buzwagi starting
January 1, 2020, the date the GoT's 16% free carried interest was
made effective (36.1% from January 1, 2019 to September 30, 2019;
notwithstanding the completion of the Acacia transaction on
September 17, 2019, we consolidated our interest in Acacia and
recorded a non-controlling interest of 36.1% in the income
statement for the entirety of the third quarter of 2019 as a matter
of convenience); 63.1% South Arturo from cost of sales from July 1,
2019 onwards as a result of its contribution to Nevada Gold Mines
(and on a 40% basis from January 1, 2019 to June 30, 2019); and our
proportionate share of cost of sales attributable to equity method
investments (Kibali, and Morila until the second quarter of 2019),
divided by attributable gold ounces. Also removes the
non-controlling interest of 38.5% Nevada Gold Mines from cost of
sales from July 1, 2019 onwards. Cost of sales applicable to copper
per pound is calculated using cost of sales applicable to copper
including our proportionate share of cost of sales attributable to
equity method investments (Zaldívar and Jabal Sayid), divided by
consolidated copper pounds (including our proportionate share of
copper pounds from our equity method investments).
Endnote 16Includes our 36.9%
share of South Arturo.
Endnote 17Based on the
communication we received from the Government of Papua New Guinea
that the SML will not be extended, Porgera was placed on temporary
care and maintenance on April 25, 2020 to ensure the safety and
security of our employees and communities. Due to the uncertainty
related to the timing and scope of future developments on the
mine’s operating outlook, our full year 2020 guidance for Porgera
has been withdrawn.
Endnote 18Amounts are on an 84%
basis as the GoT's 16% free-carried interest was made effective
from January 1, 2020.
Endnote 19Total cash costs and
all-in sustaining costs per ounce include the impact of hedges
and/or costs allocated to non-operating sites.
Endnote 20Operating unit
guidance ranges reflect expectations at each individual operating
unit, and may not add up to the company-wide guidance range total.
Guidance ranges exclude Pierina, Lagunas Norte, Golden Sunlight and
Morila (40%).
Endnote 21Includes corporate
administration costs.
Endnote 222020 Guidance
includes our 61.5% share of Nevada Gold Mines, our 60% share of
Pueblo Viejo, our 80% share of Loulo-Gounkoto, our 89.7% share of
Tongon, our 84% share of North Mara, Bulyanhulu and Buzwagi, our
50% share of Zaldívar and Jabal Sayid, and our 45% of Kibali, and
our share of joint operations.
Endnote 23Reflects the impact
of the full year.
Endnote 24EBITDA is a non-GAAP
financial measure, which excludes the following from net earnings:
income tax expense; finance costs; finance income; and
depreciation. Management believes that EBITDA is a valuable
indicator of our ability to generate liquidity by producing
operating cash flow to fund working capital needs, service debt
obligations, and fund capital expenditures. Management uses EBITDA
for this purpose. Adjusted EBITDA removes the effect of impairment
charges; acquisition/disposition gains/losses; foreign currency
translation gains/losses; other expense adjustments; unrealized
gains on non-hedge derivative instruments; and the impact of the
income tax expense, finance costs, finance income and depreciation
incurred in our equity method accounted investments. We believe
these items provide a greater level of consistency with the
adjusting items included in our Adjusted Net Earnings
reconciliation, with the exception that these amounts are adjusted
to remove any impact on finance costs/income, income tax expense
and/or depreciation as they do not affect EBITDA. We believe this
additional information will assist analysts, investors and other
stakeholders of Barrick in better understanding our ability to
generate liquidity from our full business, including equity method
investments, by excluding these amounts from the calculation as
they are not indicative of the performance of our core mining
business and not necessarily reflective of the underlying operating
results for the periods presented. EBITDA and adjusted EBITDA are
intended to provide additional information only and do not have any
standardized meaning under IFRS and may not be comparable to
similar measures of performance presented by other companies. They
should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. Further
details on these non-GAAP measures are provided in the MD&A
accompanying Barrick’s financial statements filed from time to time
on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
Reconciliation of Net Earnings to EBITDA and Adjusted
EBITDA
| ($ millions) |
For the three months ended |
For the six months ended |
|
|
6/30/20 |
3/31/20 |
6/30/19 |
6/30/20 |
6/30/19 |
|
Net earnings (loss) |
622 |
|
663 |
|
223 |
|
1,285 |
|
363 |
|
|
Income tax expense |
258 |
|
386 |
|
41 |
|
644 |
|
208 |
|
|
Finance costs, neta |
74 |
|
88 |
|
98 |
|
162 |
|
198 |
|
|
Depreciation |
566 |
|
524 |
|
466 |
|
1,090 |
|
901 |
|
|
EBITDA |
1,520 |
|
1,661 |
|
828 |
|
3,181 |
|
1,670 |
|
| Impairment charges (reversals)
of long-lived assetsb |
23 |
|
(336) |
|
12 |
|
(313) |
|
15 |
|
| Acquisition/disposition
(gains) lossesc |
8 |
|
(60) |
|
(12) |
|
(52) |
|
(12) |
|
| Loss (gain) on currency
translation |
2 |
|
16 |
|
(6) |
|
18 |
|
16 |
|
| Other expense (income)
adjustmentsd |
48 |
|
98 |
|
58 |
|
146 |
|
104 |
|
| Income tax expense, net finance
costs, and depreciation from equity investees |
96 |
|
87 |
|
92 |
|
183 |
|
181 |
|
|
Adjusted EBITDA |
1,697 |
|
1,466 |
|
972 |
|
3,163 |
|
1,974 |
|
- Finance costs exclude accretion.
- Net impairment charges for the three month period ended June
30, 2020 relate to miscellaneous assets. For the three month
period ended March 31, 2020 and the six month period ended June 30,
2020, net impairment reversals primarily relate to non-current
asset reversals at our Tanzanian assets.
- Acquisition/disposition gains for the three month period ended
March 31, 2020 and the six month period ended June 30, 2020
primarily relate to the gain on the sale of Massawa.
- Other expense adjustments for the three and six month period
ended June 30, 2020 primarily relate to care and maintenance
expenses at Porgera and Covid-19 donations. The six month
period ended June 30, 2020 was further impacted by changes in the
discount rate assumptions on our closed mine rehabilitation
provision. For the three month period ended March 31, 2020,
other expense adjustments primarily relate to the impact of changes
in the discount rate assumptions on our closed mine rehabilitation
provision and losses on debt extinguishment. Other expense
adjustments for the three and six month periods ended June 30, 2019
primarily relate to severance costs as a result of the
implementation of a number of organizational reductions, the impact
of changes in the discount rate assumptions on our closed mine
rehabilitation provision and transaction costs related to Nevada
Gold Mines.
Endnote 25Due to our hedging
activities, which are reflected in these sensitivities, we are
partially protected against changes in these factors.
Financial and Operating Highlights
| |
For the three months ended |
For the six months ended |
| |
6/30/20 |
3/31/20 |
% Change |
6/30/19 |
% Change |
6/30/20 |
6/30/19 |
% Change |
|
Financial Results ($ millions) |
|
|
|
|
|
|
|
|
|
Revenues |
3,055 |
|
2,721 |
|
12 |
|
% |
2,063 |
|
48 |
|
% |
5,776 |
|
4,156 |
|
39 |
|
% |
| Cost of sales |
1,900 |
|
1,776 |
|
7 |
|
% |
1,545 |
|
23 |
|
% |
3,676 |
|
3,035 |
|
21 |
|
% |
| Net earningsa |
357 |
|
400 |
|
(11 |
) |
% |
194 |
|
84 |
|
% |
757 |
|
305 |
|
148 |
|
% |
| Adjusted net earningsb |
415 |
|
285 |
|
46 |
|
% |
154 |
|
169 |
|
% |
700 |
|
338 |
|
107 |
|
% |
| Adjusted EBITDAb |
1,697 |
|
1,466 |
|
16 |
|
% |
972 |
|
75 |
|
% |
3,163 |
|
1,974 |
|
60 |
|
% |
| Adjusted EBITDA marginb,c |
56 |
% |
54 |
% |
4 |
|
% |
47 |
% |
19 |
|
% |
55 |
% |
47 |
% |
17 |
|
% |
| Minesite sustaining capital
expendituresd |
420 |
|
370 |
|
14 |
|
% |
267 |
|
57 |
|
% |
790 |
|
520 |
|
52 |
|
% |
| Project capital
expendituresd |
85 |
|
76 |
|
12 |
|
|
108 |
|
(21 |
) |
|
161 |
|
228 |
|
(29 |
) |
% |
| Total consolidated capital
expendituresd,e |
509 |
|
451 |
|
13 |
|
|
379 |
|
34 |
|
|
960 |
|
753 |
|
27 |
|
% |
| Net cash provided by operating
activities |
1,031 |
|
889 |
|
16 |
|
% |
434 |
|
138 |
|
% |
1,920 |
|
954 |
|
101 |
|
% |
| Net cash provided by operating
activities marginf |
34 |
% |
33 |
% |
3 |
|
% |
21 |
% |
62 |
|
% |
33 |
% |
23 |
% |
43 |
|
% |
| Free cash flowb |
522 |
|
438 |
|
19 |
|
% |
55 |
|
849 |
|
% |
960 |
|
201 |
|
378 |
|
% |
| Net earnings per share (basic
and diluted) |
0.20 |
|
0.22 |
|
(9 |
) |
% |
0.11 |
|
82 |
|
% |
0.43 |
|
0.17 |
|
153 |
|
% |
| Adjusted net earnings (basic)b
per share |
0.23 |
|
0.16 |
|
44 |
|
% |
0.09 |
|
156 |
|
% |
0.39 |
|
0.19 |
|
105 |
|
% |
| Weighted average diluted common
shares (millions of shares) |
1,778 |
|
1,778 |
|
0 |
|
% |
1,752 |
|
1 |
|
% |
1,778 |
|
1,749 |
|
2 |
|
% |
|
Operating Results |
|
|
|
|
|
|
|
|
| Gold production (thousands of
ounces)g |
1,149 |
|
1,250 |
|
(8 |
) |
% |
1,353 |
|
(15 |
) |
% |
2,399 |
|
2,720 |
|
(12 |
) |
% |
| Gold sold (thousands of
ounces)g |
1,224 |
|
1,220 |
|
0 |
|
% |
1,372 |
|
(11 |
) |
% |
2,444 |
|
2,737 |
|
(11 |
) |
% |
| Market gold price ($/oz) |
1,711 |
|
1,583 |
|
8 |
|
% |
1,309 |
|
31 |
|
% |
1,645 |
|
1,307 |
|
26 |
|
% |
| Realized gold priceb,g
($/oz) |
1,725 |
|
1,589 |
|
9 |
|
% |
1,317 |
|
31 |
|
% |
1,657 |
|
1,312 |
|
26 |
|
% |
| Gold cost of sales (Barrick’s
share)g,h ($/oz) |
1,075 |
|
1,020 |
|
5 |
|
% |
964 |
|
12 |
|
% |
1,048 |
|
956 |
|
10 |
|
% |
| Gold total cash costsb,g
($/oz) |
716 |
|
692 |
|
3 |
|
% |
651 |
|
10 |
|
% |
704 |
|
641 |
|
10 |
|
% |
| Gold all-in sustaining
costsb,g ($/oz) |
1,031 |
|
954 |
|
8 |
|
% |
869 |
|
19 |
|
% |
993 |
|
842 |
|
18 |
|
% |
| Copper production (millions of
pounds)i |
120 |
|
115 |
|
4 |
|
% |
97 |
|
24 |
|
% |
235 |
|
203 |
|
16 |
|
% |
| Copper sold (millions of
pounds)i |
123 |
|
110 |
|
12 |
|
% |
96 |
|
28 |
|
% |
233 |
|
199 |
|
17 |
|
% |
| Market copper price
($/lb) |
2.43 |
|
2.56 |
|
(5 |
) |
% |
2.77 |
|
(12 |
) |
% |
2.49 |
|
2.80 |
|
(11 |
) |
% |
| Realized copper priceb,i
($/lb) |
2.79 |
|
2.23 |
|
25 |
|
% |
2.62 |
|
6 |
|
% |
2.53 |
|
2.85 |
|
(11 |
) |
% |
| Copper cost of sales
(Barrick’s share)i,j ($/lb) |
2.08 |
|
1.96 |
|
6 |
|
% |
2.04 |
|
2 |
|
% |
2.03 |
|
2.13 |
|
(5 |
) |
% |
| Copper C1 cash costsb,i
($/lb) |
1.55 |
|
1.55 |
|
0 |
|
% |
1.59 |
|
(3 |
) |
% |
1.55 |
|
1.62 |
|
(4 |
) |
% |
| Copper all-in sustaining
costsb,i ($/lb) |
2.15 |
|
2.04 |
|
5 |
|
% |
2.28 |
|
(6 |
) |
% |
2.10 |
|
2.37 |
|
(11 |
) |
% |
|
|
As at 6/30/20 |
As at 3/31/20 |
% Change |
As at 6/30/19 |
% Change |
|
|
|
|
Financial Position ($ millions) |
|
|
|
|
|
|
|
|
| Debt (current and long-term) |
5,168 |
|
5,179 |
|
0 |
|
% |
5,807 |
|
(11 |
) |
% |
|
|
|
| Cash and equivalents |
3,743 |
|
3,327 |
|
13 |
|
% |
2,153 |
|
74 |
|
% |
|
|
|
|
Debt, net of cash |
1,425 |
|
1,852 |
|
(23 |
) |
% |
3,654 |
|
(61 |
) |
% |
|
|
|
a. Net earnings represents net earnings
attributable to the equity holders of the
Company.b. Adjusted net earnings, adjusted
EBITDA, adjusted EBITDA margin, free cash flow, adjusted net
earnings per share, realized gold price, all-in sustaining costs,
total cash costs, C1 cash costs and realized copper price are
non-GAAP financial performance measures with no standardized
meaning under IFRS and therefore may not be comparable to similar
measures presented by other issuers. For further information and a
detailed reconciliation of each non-GAAP measure to the most
directly comparable IFRS measure, please see pages 79 to 103 of our
second quarter MD&A.c. Represents adjusted
EBITDA divided by revenue.d. Amounts presented on
a consolidated cash basis. Project capital expenditures are
included in our calculation of all-in costs, but not included in
our calculation of all-in sustaining costs.e.
Total consolidated capital expenditures also includes capitalized
interest.f. Represents net cash provided by
operating activities divided by revenue.g.
Includes North Mara, Bulyanhulu and Buzwagi on a 84% basis starting
January 1, 2020 (and on a 63.9% basis from January 1, 2019 to
September 30, 2019; notwithstanding the completion of the Acacia
transaction on September 17, 2019, we consolidated our interest in
Acacia and recorded a non-controlling interest of 36.1% in the
income statement for the entirety of the third quarter of 2019 as a
matter of convenience, and on a 100% basis from October 1, 2019 to
December 31, 2019), Pueblo Viejo on a 60% basis, South Arturo on a
36.9% basis from July 1, 2019 onwards as a result of its
contribution to Nevada Gold Mines (and on a 60% basis from January
1, 2019 to June 30, 2019), Veladero on a 50% basis, Loulo-Gounkoto
on an 80% basis, Kibali on a 45% basis, Tongon on an 89.7% basis,
and Morila on a 40% basis until the second quarter of 2019, which
reflects our equity share of production and sales. Also removes the
non-controlling interest of 38.5% Nevada Gold Mines from July 1,
2019 onwards. h. Gold cost of sales (Barrick’s
share) is calculated as gold cost of sales on an attributable basis
(excluding sites in care and maintenance) divided by ounces
sold.i. Amounts reflect production and
sales from Jabal Sayid and Zaldívar on a 50% basis, which reflects
our equity share of production, and
Lumwana.j. Copper cost of sales (Barrick’s
share) is calculated as copper cost of sales plus our equity share
of cost of sales attributable to Zaldívar and Jabal Sayid divided
by pounds sold.
Consolidated Statements of Income
| Barrick Gold Corporation (in
millions of United States dollars, except per share data)
(Unaudited) |
Three months ended June 30, |
Six months ended June 30, |
|
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
Revenue (notes 5 and 6) |
$ |
3,055 |
|
|
$ |
2,063 |
|
|
$ |
5,776 |
|
|
$ |
4,156 |
|
|
|
Costs and expenses (income) |
|
|
|
|
| Cost of sales (notes 5 and
7) |
|
1,900 |
|
|
|
1,545 |
|
|
|
3,676 |
|
|
|
3,035 |
|
|
| General and administrative
expenses |
|
71 |
|
|
|
59 |
|
|
|
111 |
|
|
|
113 |
|
|
| Exploration, evaluation and
project expenses |
|
78 |
|
|
|
98 |
|
|
|
149 |
|
|
|
172 |
|
|
| Impairment (reversals) charges
(notes 9B and 13) |
|
23 |
|
|
|
12 |
|
|
|
(313 |
) |
|
|
15 |
|
|
| Loss (gain) on currency
translation |
|
2 |
|
|
|
(6 |
) |
|
|
18 |
|
|
|
16 |
|
|
| Closed mine rehabilitation |
|
7 |
|
|
|
16 |
|
|
|
97 |
|
|
|
41 |
|
|
| Income from equity investees
(note 12) |
|
(61 |
) |
|
|
(50 |
) |
|
|
(115 |
) |
|
|
(78 |
) |
|
| Other expense (note 9A) |
|
73 |
|
|
|
7 |
|
|
|
38 |
|
|
|
33 |
|
|
|
Income before finance costs and income taxes |
$ |
962 |
|
|
$ |
382 |
|
|
$ |
2,115 |
|
|
$ |
809 |
|
|
| Finance costs, net |
|
(82 |
) |
|
|
(118 |
) |
|
|
(186 |
) |
|
|
(238 |
) |
|
|
Income before income taxes |
$ |
880 |
|
|
$ |
264 |
|
|
$ |
1,929 |
|
|
$ |
571 |
|
|
| Income tax expense (note 10) |
|
(258 |
) |
|
|
(41 |
) |
|
|
(644 |
) |
|
|
(208 |
) |
|
|
Net income |
$ |
622 |
|
|
$ |
223 |
|
|
$ |
1,285 |
|
|
$ |
363 |
|
|
|
Attributable to: |
|
|
|
|
| Equity holders of Barrick Gold
Corporation |
$ |
357 |
|
|
$ |
194 |
|
|
$ |
757 |
|
|
$ |
305 |
|
|
| Non-controlling interests |
$ |
265 |
|
|
$ |
29 |
|
|
$ |
528 |
|
|
$ |
58 |
|
|
|
|
|
|
|
|
| Earnings per share
data attributable to the equity holders of Barrick Gold Corporation
(note 8) |
|
|
|
|
| Net income |
|
|
|
|
|
Basic |
$ |
0.20 |
|
|
$ |
0.11 |
|
|
$ |
0.43 |
|
|
$ |
0.17 |
|
|
|
Diluted |
$ |
0.20 |
|
|
$ |
0.11 |
|
|
$ |
0.43 |
|
|
$ |
0.17 |
|
|
The notes to these unaudited condensed interim financial
statements, which are contained in the Second Quarter Report 2020
available on our website are an integral part of these consolidated
financial statements.
Consolidated Statements of Comprehensive
Income
| Barrick Gold Corporation (in
millions of United States dollars) (Unaudited) |
Three months ended June 30, |
Six months ended June 30, |
|
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| Net
income |
$ |
622 |
|
|
$ |
223 |
|
|
$ |
1,285 |
|
|
$ |
363 |
|
|
| Other comprehensive
(loss) income, net of taxes |
|
|
|
|
| Items that may be
reclassified subsequently to profit or loss: |
|
|
|
|
| Unrealized gains (losses) on
derivatives designated as cash flow hedges, net of tax $nil, $nil,
$nil and $nil |
|
(2 |
) |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
| Currency translation adjustments,
net of tax $nil, $nil, $nil and $nil |
|
(1 |
) |
|
|
(1 |
) |
|
|
(5 |
) |
|
|
(3 |
) |
|
| Items that will not be
reclassified to profit or loss: |
|
|
|
|
| Actuarial gain (loss) on post
employment benefit obligations, net of tax ($3), $nil, $nil and
$nil |
|
(5 |
) |
|
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
| Net change on equity investments,
net of tax $nil, $nil, $nil and $nil |
|
118 |
|
|
|
11 |
|
|
|
93 |
|
|
|
7 |
|
|
|
Total other comprehensive income |
|
110 |
|
|
|
10 |
|
|
|
85 |
|
|
|
4 |
|
|
|
Total comprehensive income |
$ |
732 |
|
|
$ |
233 |
|
|
$ |
1,370 |
|
|
$ |
367 |
|
|
|
Attributable to: |
|
|
|
|
| Equity holders of Barrick Gold
Corporation |
$ |
467 |
|
|
$ |
204 |
|
|
$ |
842 |
|
|
$ |
309 |
|
|
|
Non-controlling interests |
$ |
265 |
|
|
$ |
29 |
|
|
$ |
528 |
|
|
$ |
58 |
|
|
The notes to these unaudited condensed interim financial
statements, which are contained in the Second Quarter Report 2020
available on our website are an integral part of these consolidated
financial statements.
Consolidated Statements of Cash Flow
| Barrick Gold Corporation
(in millions of United States dollars) (Unaudited) |
Three months ended June 30, |
Six months ended June 30, |
|
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
OPERATING ACTIVITIES |
|
|
|
|
| Net income |
$ |
622 |
|
|
$ |
223 |
|
|
$ |
1,285 |
|
|
$ |
363 |
|
|
| Adjustments for the following
items: |
|
|
|
|
|
Depreciation |
|
566 |
|
|
|
466 |
|
|
|
1,090 |
|
|
|
901 |
|
|
|
Finance costs, net |
|
86 |
|
|
|
125 |
|
|
|
197 |
|
|
|
252 |
|
|
|
Impairment (reversals) charges (notes 9B and 13) |
|
23 |
|
|
|
12 |
|
|
|
(313 |
) |
|
|
15 |
|
|
|
Income tax expense (note 10) |
|
258 |
|
|
|
41 |
|
|
|
644 |
|
|
|
208 |
|
|
|
Loss (gain) on sale of non-current assets |
|
8 |
|
|
|
(12 |
) |
|
|
(52 |
) |
|
|
(12 |
) |
|
|
Loss (gain) on currency translation |
|
2 |
|
|
|
(6 |
) |
|
|
18 |
|
|
|
16 |
|
|
| Change in working capital
(note 11) |
|
(9 |
) |
|
|
(82 |
) |
|
|
(341 |
) |
|
|
(330 |
) |
|
| Other operating activities
(note 11) |
|
(35 |
) |
|
|
38 |
|
|
|
18 |
|
|
|
14 |
|
|
|
Operating cash flows before interest and income taxes |
|
1,521 |
|
|
|
805 |
|
|
|
2,546 |
|
|
|
1,427 |
|
|
| Interest paid |
|
(130 |
) |
|
|
(137 |
) |
|
|
(154 |
) |
|
|
(165 |
) |
|
| Income taxes paid |
|
(360 |
) |
|
|
(234 |
) |
|
|
(472 |
) |
|
|
(308 |
) |
|
|
Net cash provided by operating activities |
|
1,031 |
|
|
|
434 |
|
|
|
1,920 |
|
|
|
954 |
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
| Property, plant and
equipment |
|
|
|
|
|
Capital expenditures (note 5) |
|
(509 |
) |
|
|
(379 |
) |
|
|
(960 |
) |
|
|
(753 |
) |
|
|
Sales proceeds |
|
9 |
|
|
|
15 |
|
|
|
16 |
|
|
|
18 |
|
|
| Investment sales
(purchases) |
|
206 |
|
|
|
(4 |
) |
|
|
206 |
|
|
|
(7 |
) |
|
| Divestitures (note 4) |
|
— |
|
|
|
— |
|
|
|
256 |
|
|
|
— |
|
|
| Cash acquired in merger |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
751 |
|
|
| Other investing activities
(note 11) |
|
30 |
|
|
|
17 |
|
|
|
55 |
|
|
|
62 |
|
|
|
Net cash provided by (used in) investing
activities |
|
(264 |
) |
|
|
(351 |
) |
|
|
(427 |
) |
|
|
71 |
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
| Lease repayments |
|
(7 |
) |
|
|
(6 |
) |
|
|
(12 |
) |
|
|
(18 |
) |
|
| Debt repayments |
|
— |
|
|
|
— |
|
|
|
(351 |
) |
|
|
(16 |
) |
|
| Dividends |
|
(124 |
) |
|
|
(61 |
) |
|
|
(246 |
) |
|
|
(394 |
) |
|
| Funding from non-controlling
interests |
|
— |
|
|
|
8 |
|
|
|
1 |
|
|
|
14 |
|
|
| Disbursements to
non-controlling interests |
|
(217 |
) |
|
|
(23 |
) |
|
|
(434 |
) |
|
|
(28 |
) |
|
| Other financing
activities |
|
— |
|
|
|
— |
|
|
|
(15 |
) |
|
|
— |
|
|
|
Net cash used in financing activities |
|
(348 |
) |
|
|
(82 |
) |
|
|
(1,057 |
) |
|
|
(442 |
) |
|
|
Effect of exchange rate changes on cash and
equivalents |
|
(3 |
) |
|
|
(1 |
) |
|
|
(7 |
) |
|
|
(1 |
) |
|
|
Net increase in cash and equivalents |
|
416 |
|
|
|
— |
|
|
|
429 |
|
|
|
582 |
|
|
| Cash and equivalents
at the beginning of period |
|
3,327 |
|
|
|
2,153 |
|
|
|
3,314 |
|
|
|
1,571 |
|
|
|
Cash and equivalents at the end of period |
$ |
3,743 |
|
|
$ |
2,153 |
|
|
$ |
3,743 |
|
|
$ |
2,153 |
|
|
The notes to these unaudited condensed interim financial
statements, which are contained in the Second Quarter Report 2020
available on our website are an integral part of these consolidated
financial statements.
Consolidated Balance Sheets
| Barrick Gold Corporation
(in millions of United States dollars) (Unaudited) |
As at June 30, |
As at December 31, |
|
|
|
2020 |
|
2019 |
|
ASSETS |
|
|
| Current assets |
|
|
|
Cash and equivalents (note 14A) |
$ |
3,743 |
|
|
$ |
3,314 |
|
|
|
Accounts receivable |
|
407 |
|
|
|
363 |
|
|
|
Inventories |
|
2,160 |
|
|
|
2,289 |
|
|
|
Other current assets |
|
609 |
|
|
|
565 |
|
|
|
Total current assets (excluding assets classified as held for
sale) |
$ |
6,919 |
|
|
$ |
6,531 |
|
|
|
Assets classified as held for sale (note 4A) |
|
— |
|
|
|
356 |
|
|
|
Total current assets |
$ |
6,919 |
|
|
$ |
6,887 |
|
|
| Non-current assets |
|
|
|
Equity in investees (note 12) |
|
4,587 |
|
|
|
4,527 |
|
|
|
Property, plant and equipment |
|
24,727 |
|
|
|
24,141 |
|
|
|
Goodwill |
|
4,769 |
|
|
|
4,769 |
|
|
|
Intangible assets |
|
214 |
|
|
|
226 |
|
|
|
Deferred income tax assets |
|
143 |
|
|
|
235 |
|
|
|
Non-current portion of inventory |
|
2,460 |
|
|
|
2,300 |
|
|
|
Other assets |
|
1,361 |
|
|
|
1,307 |
|
|
|
Total assets |
$ |
45,180 |
|
|
$ |
44,392 |
|
|
|
LIABILITIES AND EQUITY |
|
|
| Current liabilities |
|
|
|
Accounts payable |
$ |
1,072 |
|
|
$ |
1,155 |
|
|
|
Debt (note 14B) |
|
26 |
|
|
|
375 |
|
|
|
Current income tax liabilities |
|
122 |
|
|
|
224 |
|
|
|
Other current liabilities |
|
591 |
|
|
|
622 |
|
|
|
Total current liabilities |
$ |
1,811 |
|
|
$ |
2,376 |
|
|
| Non-current liabilities |
|
|
|
Debt (note 14B) |
|
5,142 |
|
|
|
5,161 |
|
|
|
Provisions |
|
3,291 |
|
|
|
3,114 |
|
|
|
Deferred income tax liabilities |
|
3,106 |
|
|
|
3,091 |
|
|
|
Other liabilities |
|
1,084 |
|
|
|
823 |
|
|
|
Total liabilities |
$ |
14,434 |
|
|
$ |
14,565 |
|
|
|
Equity |
|
|
|
Capital stock (note 16) |
$ |
29,234 |
|
|
$ |
29,231 |
|
|
|
Deficit |
|
(9,214 |
) |
|
|
(9,722 |
) |
|
|
Accumulated other comprehensive loss |
|
(37 |
) |
|
|
(122 |
) |
|
|
Other |
|
2,049 |
|
|
|
2,045 |
|
|
|
Total equity attributable to Barrick Gold Corporation
shareholders |
$ |
22,032 |
|
|
$ |
21,432 |
|
|
|
Non-controlling interests |
|
8,714 |
|
|
|
8,395 |
|
|
|
Total equity |
$ |
30,746 |
|
|
$ |
29,827 |
|
|
|
Contingencies and commitments (notes 5 and 17) |
|
|
|
Total liabilities and equity |
$ |
45,180 |
|
|
$ |
44,392 |
|
|
The notes to these unaudited condensed interim financial
statements, which are contained in the Second Quarter Report 2020
available on our website are an integral part of these consolidated
financial statements.
Consolidated Statements of Changes in
Equity
| Barrick Gold Corporation |
|
Attributable to equity holders of the company |
|
|
|
(in millions of United States dollars) (Unaudited) |
Common Shares (in thousands) |
Capital stock |
Retained earnings (deficit) |
Accumulated other comprehensive income (loss)1 |
Other2 |
Total equity attributable to shareholders |
Non-controlling interests |
Total equity |
|
At January 1, 2020 |
1,777,927 |
|
$ |
29,231 |
|
($ |
9,722 |
) |
|
($ |
122 |
) |
|
$ |
2,045 |
|
$ |
21,432 |
|
|
$ |
8,395 |
|
|
$ |
29,827 |
|
|
|
Net income |
— |
|
|
— |
|
|
757 |
|
|
|
— |
|
|
|
— |
|
|
757 |
|
|
|
528 |
|
|
|
1,285 |
|
|
|
Total other comprehensive income (loss) |
— |
|
|
— |
|
|
— |
|
|
|
85 |
|
|
|
— |
|
|
85 |
|
|
|
— |
|
|
|
85 |
|
|
|
Total comprehensive income |
— |
|
|
— |
|
|
757 |
|
|
|
85 |
|
|
|
— |
|
|
842 |
|
|
|
528 |
|
|
|
1,370 |
|
|
|
Transactions with owners |
|
|
|
|
|
|
|
|
|
Dividends |
— |
|
|
— |
|
|
(246 |
) |
|
|
— |
|
|
|
— |
|
|
(246 |
) |
|
|
— |
|
|
|
(246 |
) |
|
|
Issuance of 16% interest in Tanzania mines (note 13) |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
238 |
|
|
|
238 |
|
|
|
Issued on exercise of stock options |
40 |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
Funding from non-controlling interests |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
1 |
|
|
|
1 |
|
|
|
Disbursements to non-controlling interests |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
(448 |
) |
|
|
(448 |
) |
|
|
Dividend reinvestment plan (note 16) |
101 |
|
|
3 |
|
|
(3 |
) |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
Share-based payments |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
4 |
|
|
4 |
|
|
|
— |
|
|
|
4 |
|
|
|
Total transactions with owners |
141 |
|
|
3 |
|
|
(249 |
) |
|
|
— |
|
|
|
4 |
|
|
(242 |
) |
|
|
(209 |
) |
|
|
(451 |
) |
|
|
At June 30, 2020 |
1,778,068 |
|
$ |
29,234 |
|
($ |
9,214 |
) |
|
($ |
37 |
) |
|
$ |
2,049 |
|
$ |
22,032 |
|
|
$ |
8,714 |
|
|
$ |
30,746 |
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2019 |
1,167,847 |
|
$ |
20,883 |
|
($ |
13,453 |
) |
|
($ |
158 |
) |
|
$ |
321 |
|
$ |
7,593 |
|
|
$ |
1,792 |
|
|
$ |
9,385 |
|
|
|
Net income |
— |
|
|
— |
|
|
305 |
|
|
|
— |
|
|
|
— |
|
|
305 |
|
|
|
58 |
|
|
|
363 |
|
|
|
Total other comprehensive income |
— |
|
|
— |
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
4 |
|
|
|
— |
|
|
|
4 |
|
|
|
Total comprehensive income |
— |
|
|
— |
|
|
305 |
|
|
|
4 |
|
|
|
— |
|
|
309 |
|
|
|
58 |
|
|
|
367 |
|
|
|
Transactions with owners |
|
|
|
|
|
|
|
|
|
Dividends |
— |
|
|
— |
|
|
(64 |
) |
|
|
— |
|
|
|
— |
|
|
(64 |
) |
|
|
— |
|
|
|
(64 |
) |
|
|
Merger with Randgold Resources Limited |
583,669 |
|
|
7,903 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
7,903 |
|
|
|
885 |
|
|
|
8,788 |
|
|
|
Issued on exercise of stock options |
25 |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
Funding from non-controlling interests |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
14 |
|
|
|
14 |
|
|
|
Disbursements to non-controlling interests |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
(28 |
) |
|
|
(28 |
) |
|
|
Dividend reinvestment plan (note 16) |
1,128 |
|
|
15 |
|
|
(15 |
) |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
Share-based payments |
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
5 |
|
|
5 |
|
|
|
— |
|
|
|
5 |
|
|
|
Total transactions with owners |
584,822 |
|
|
7,918 |
|
|
(79 |
) |
|
|
— |
|
|
|
5 |
|
|
7,844 |
|
|
|
871 |
|
|
|
8,715 |
|
|
|
At June 30, 2019 |
1,752,669 |
|
$ |
28,801 |
|
($ |
13,227 |
) |
|
($ |
154 |
) |
|
$ |
326 |
|
$ |
15,746 |
|
|
$ |
2,721 |
|
|
$ |
18,467 |
|
|
1 Includes cumulative translation losses
at June 30, 2020: $92 million (June 30, 2019: $84
million).2 Includes additional paid-in
capital as at June 30, 2020: $2,011 million
(December 31, 2019: $2,007 million; June 30, 2019:
$283 million).The notes to these unaudited condensed interim
financial statements, which are contained in the Second Quarter
Report 2020 available on our website are an integral part of these
consolidated financial statements.
Corporate Office
Barrick Gold Corporation161 Bay
Street, Suite 3700Toronto, Ontario M5J 2S1Canada
Telephone: +1 416 861-9911Email:
investor@barrick.comWebsite: www.barrick.com
Shares Listed
GOLDThe New York Stock
Exchange
ABXThe Toronto Stock
Exchange
Transfer Agents and Registrars
AST Trust Company (Canada)P.O.
Box 700, Postal Station BMontreal, Quebec H3B 3K3or
American Stock Transfer & Trust Company,
LLC6201 – 15 AvenueBrooklyn, New York 11219
Telephone: 1-800-387-0825Fax:
1-888-249-6189Email: inquiries@astfinancial.comWebsite:
www.astfinancial.com
Enquiries
President and chief executiveMark Bristow+1 647
205 7694+44 788 071 1386
SEVP and chief financial officerGraham
Shuttleworth+1 647 262 2095+44 779 771 1338
Investor and media RelationsKathy du Plessis+44
20 7557 7738Email: barrick@dpapr.com
Cautionary Statement on Forward-Looking
Information
Certain information contained or incorporated by
reference in this press release, including any information as to
our strategy, projects, plans or future financial or operating
performance, constitutes “forward-looking statements”. All
statements, other than statements of historical fact, are
forward-looking statements. The words “deliver”, "plan",
"objective", "expected", “potential”, “strategy”, “will”,
"continues", “ongoing” and similar expressions identify
forward-looking statements. In particular, this press release
contains forward-looking statements including, without limitation,
with respect to: Barrick’s forward-looking production guidance and
estimates of future costs; Barrick’s non-core asset disposal
strategy; potential extensions to life of mine, including at Hemlo;
production rates, including potential production from North Mara
and Bulyanhulu; Barrick’s response to the government of Papua New
Guinea’s decision not to extend Porgera’s Special Mining Lease; the
duration of the temporary suspension of operations at Porgera;
potential mineralization; potential exploration targets and mineral
resource potential, including reserve replenishment; future
dividend levels; Barrick’s engagement with local communities to
manage the Covid-19 pandemic; future investments in community
projects and contributions to local economies; the new joint
venture with the Government of Tanzania; timing of resumption of
production at Bulyanhulu; timing of development of the Goldrush
declines; and expectations regarding future price assumptions,
financial performance and other outlook or guidance.
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 and 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; risks associated with projects in the early stages of
evaluation and for which additional engineering and other analysis
is required; the benefits expected from recent transactions being
realized; diminishing quantities or grades of 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 and disruptions in the
maintenance or provision of required infrastructure and information
technology systems; failure to comply with environmental and health
and safety laws and regulations; non-renewal of key licenses by
governmental authorities, including non-renewal of Porgera’s
Special Mining Lease; timing of receipt of, or failure to comply
with, necessary permits and approvals; uncertainty whether some or
all of Barrick's targeted investments and projects will meet the
Company’s capital allocation objectives and internal hurdle rate;
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; adverse changes in our credit
ratings; the impact of inflation; fluctuations in the currency
markets; changes in U.S. dollar interest rates; risks arising from
holding derivative instruments; 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; risks associated with illegal
and artisanal mining; risks associated with new diseases, epidemics
and pandemics, including the effects and potential effects of the
global Covid-19 pandemic; disruption of supply routes which may
cause delays in construction and mining activities; 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; 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; risk of loss due to acts of
war, terrorism, sabotage and civil disturbances; 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, including our ability to successfully reintegrate
Acacia’s operations; risks associated with working with partners in
jointly controlled assets; employee relations including loss of key
employees; increased costs and physical risks, including extreme
weather events and resource shortages, related to climate change;
and availability and increased costs associated with mining inputs
and labor. Barrick also cautions that its 2020 guidance may be
impacted by the unprecedented business and social disruption caused
by the spread of Covid-19. 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. We disclaim 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.
Grafico Azioni Barrick Gold (TSX:ABX)
Storico
Da Mar 2024 a Apr 2024
Grafico Azioni Barrick Gold (TSX:ABX)
Storico
Da Apr 2023 a Apr 2024
