Proactiveinvestors USA & Canada Barrick https://www.proactiveinvestors.com Proactiveinvestors USA & Canada Barrick RSS feed en Sat, 15 Jun 2019 19:44:14 -0400 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - Barrick Gold ends hostile takeover bid for Newmont, announces Nevada joint venture ]]> https://www.proactiveinvestors.com/companies/news/216198/barrick-gold-ends-hostile-takeover-bid-for-newmont-announces-nevada-joint-venture-216198.html Barrick Gold Corp (NYSE:GOLD) (TSX:ABX) withdrew its unsolicited $17.85 billion bid to acquire Newmont Mining Corporation (NYSE:NEM), the companies announced on Monday, a move that would’ve united the world’s two largest gold producers.

Instead, Barrick and Newmont will embark on a joint venture in Nevada.

Barrick will be the majority owner of the combined mining operation, with a 61.5% stake in the venture. The deal will allow the companies to capture an estimated US$500 million in average annual pre-tax synergies in the first five years and $5 billion in pre-tax present value over 20 years.

“We are finally taking down the fences to operate Nevada as a single entity in order to deliver full value to both sets of shareholders, as well as to all our stakeholders in the state, by securing the long-term future of gold mining in Nevada,” Barrick President and CEO Mark Bristow said in a statement.

READ: Here’s why the consolidation in the gold mining industry is far from over

The joint venture demonstrates that mergers and acquisitions activity Is speeding up as miners look to amass assets in anticipation of a bull market, industry executives say.

“Acquiring ounces before the bull market fully takes hold seems to be the strategy,” Gold Resource Corporation (NYSEAMERICAN:GORO) CEO Jason Reid told Proactive Investors. “Once the bull market is on solid ground, M&A opportunities will get expensive fast. …To me, bear markets are for buying, and the recent M&A activity is behind the curve and should have taken place years ago.”

The joint venture is already paying off for Barrick’s share price, which was ahead 2.8% to $13.29 on the NYSE and up 2.2% to $17.34 on the TSX Friday morning. Newmont, meanwhile, fluctuated around the flatline of $33.75.

Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com

Follow him on Twitter @andrew_kessel

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Mon, 11 Mar 2019 09:43:00 -0400 https://www.proactiveinvestors.com/companies/news/216198/barrick-gold-ends-hostile-takeover-bid-for-newmont-announces-nevada-joint-venture-216198.html
<![CDATA[News - Barrick’s Bristow aiming to capture “missing billions” with hostile Newmont bid ]]> https://www.proactiveinvestors.com/companies/news/215329/barricks-bristow-aiming-to-capture-missing-billions-with-hostile-newmont-bid-215329.html “Capturing the missing billions.”

That’s the title of the presentation that the suddenly-galvanised PR officers of Barrick Gold (NYSE:GOLD)(TSE:ABX) have put together in order to justify the company’s audacious offer for Newmont (NYSE:NEM), announced on 25th February.

The proposition is straightforward enough. Barrick, energised by its freshly installed chief executive Mark Bristow, reckons it can find US$7bn of “real synergies” if the two companies marry up.

Newmont has rejected the offer, with Newmont chief executive Gary Goldberg quoted as saying that Bristow’s experience in the sector is “anemic.”

That will come as some surprise to those familiar with the way Bristow built up Randgold into one of the most reliable gold companies anywhere in the world.

It will be less of a surprise though, that Bristow has his own opinions about Goldberg, telling Reuters that the track record of the Newmont chief in building value shows that he’s a “loser”.

It’s a tussle that’s likely to set the conference hall and surrounding areas buzzing at the ongoing BMO Metals and Mining conference in Hollywood, Florida, which started on 25 February.

Both Newmont and Barrick are due to make presentations, and both will be under considerable pressure to win over audiences.

Barrick itself has been a picture of dynamism since Bristow took over as chief executive last month. There has been a flurry of activity that has included the streamlining of senior management, a restructuring of regional offices, and a significant high-level move to resolve the ongoing disputes around majority-owned Acacia Mining (LON:ACA).

So, Bristow has hit the ground running, and it looks like he’s not planning on stopping any time soon. The US$18bn hostile play for Newmont fits in with a pattern of ongoing consolidation in the gold industry, highlighted most recently by the absorption of Randgold into Barrick, but also on a smaller level by moves being made by the likes of Chaarat Gold Holdings (LON:CGH) to bring major mines in Central Asia together under one roof.

But the pace of Bristow’s attack has been blistering, and looks set to shake up the market good and proper.

After all, it can be no accident that It can be no accident that Bristow chose the week of the BMO conference to make the announcement. The BMO gathering is a high-level affair, not a retail-heavy gathering like so many other conferences around the world. It’s when North America’s biggest names in mining gather to take the pulse of the industry and to do deals.

This week the pulse has quickened quite considerably.

And there’s no doubt that despite Goldberg’s vigorous rebuttal, Newmont has been wrong-footed. It’s currently in the throes of acquiring Goldcorp (TSE:GG), in another sign of the trend to consolidation, but that deal may now fall apart, much to Goldberg’s evident frustration.

Bristow argues that the synergies on offer in the Goldcorp deal pale when compared to those on offer in a Barrick-Newmont combination. In particular he points to the Nevada holdings of both companies as being ripe for consolidation in that Newmont has far greater processing capabilities there, while Barrick’s landholding is of comparable size.

Nevada is one of the world’s great gold mining destinations, in particular the famous Carlin trend, which is where Newmont first started out. Newmont currently operates 19 mines in the state.

Most industry analysts agree with the basic premise that the operations of the two companies could be combined. Indeed it’s been tried before, famously in 2014, when the gold price was just coming down from its multi-year highs, and a full-blown merger was tabled, but which eventually fell apart, partly because of the acrimonious relationship that developed between management teams.

This time round, there’s still consensus that a Nevada combination makes sense, only for Newmont the preferred method would be joint venture rather than a merger.

Swirling around in the background, meanwhile, is Goldcorp, which could come off as a major loser from the Newmont-Barrick tussle. Newmont wants to go ahead with the Goldcorp deal, but with Barrick now on its own share register and tabling amendments to its articles of association, it’s going to be an uphill struggle.

Indeed, in spite of the notional discount on offer from Barrick, now that Newmont shares have moved up in response to the offer, shareholders in Newmont may well gravitate towards Bristow’s offer.

He holds out the prospect of a much improved net asset value for the combined entity, which in turn would underpin the share price. For the time being it’s a rising gold market, so a bullish approach to future valuation makes sense, although what the long-term outlook for gold is remains the perennial question.

The other issue that’s yet to be tested is regulatory. Will there be an anti-trust investigation into such a deal? On some readings that’s unlikely, given that even though a Barrick-Newmont combination would create the world’s largest gold company, it would still account for less than 20% of the market and most of the world’s gold is already in circulation and available for trade.

On the other hand, US anti-trust authorities have waded into gold mining deals for less, and may at the very least request asset disposals.

To some degree that’s already been anticipated by Barrick, which is reportedly looking to spin off some of Newmont’s Australian assets, with local champion Newcrest as the likely buyer.

And it’s that dynamic too which may allow Goldcorp to save some face and some value, if its US$10bn acquisition by Newmont does fall through. An enlarged Barrick-Newmont may spin off other significant assets either for regulatory or efficiency reasons, and some of these may fall Goldcorp’s way.

It’s an interesting dynamic in a sector that’s really coming back to life after several years of quiet perseverance.

 

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Tue, 26 Feb 2019 13:09:00 -0500 https://www.proactiveinvestors.com/companies/news/215329/barricks-bristow-aiming-to-capture-missing-billions-with-hostile-newmont-bid-215329.html
<![CDATA[News - Canada's Barrick Gold mulls hostile $19B bid for Colorado’s Newmont Mining ]]> https://www.proactiveinvestors.com/companies/news/215140/canada-s-barrick-gold-mulls-hostile-19b-bid-for-colorados-newmont-mining-215140.html Barrick Gold Corp (TSE:ABX) (NYSE:GOLD), Canada's mega-gold producer, is considering a hostile bid for Newmont Mining Corporation (ASX:NEM) (NYSE:NEM) for about $19 billion in stock, as the mining giant looks for ways to boost production.

The Globe and Mail newspaper reported that Barrick has pored over the feasibility of an offer for Newmont for some time and one possibility that Barrick has studied would involve flipping some of Newmont's assets to Australia's Newcrest Mining Ltd (ASX:NCM), which operates mines in four countries.

Under the potential terms of the deal, Barrick would keep Newmont's Nevada and African mines, while Australia’s Newcrest Mining would take over its Australian operations, which are worth billions, according to the report.

READ: Barrick Gold and Randgold Resources merge to create world's largest gold miner but questions still remain

If the move pans out, it would potentially be one of the largest-ever mining deals.

Greenwood Village, Colorado-based Newmont has a market value of almost $19 billion. Shares in Newmont climbed 3.6% to $36.70 before the opening bell Friday, while Barrick slipped 2.03% to $13.05 in the New York Stock Exchange.

Barrick Gold recently engulfed Randgold Resources in an all-share deal to create a powerhouse valued at US$18.3 billion.

The merger created a mammoth gold company, in an era where there have not been any significant mergers in some time. Combined, both companies own a number of the world's most valuable gold fields and produce around 6.6 million ounces of gold a year.

Barrick Gold CEO Mark Bristow earlier said on a post-earnings call that Barrick Gold would continue to look at opportunities for mergers or acquisitions

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

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Fri, 22 Feb 2019 08:26:00 -0500 https://www.proactiveinvestors.com/companies/news/215140/canada-s-barrick-gold-mulls-hostile-19b-bid-for-colorados-newmont-mining-215140.html
<![CDATA[News - Barrick shares drop after mining giant misses 4Q Wall Street revenue estimate ]]> https://www.proactiveinvestors.com/companies/news/214553/barrick-shares-drop-after-mining-giant-misses-4q-wall-street-revenue-estimate-214553.html Barrick Gold Corp (NYSE:GOLD) (TSE:ABX) slipped Wednesday after reporting a decline in fourth-quarter revenue, missing the estimates of Wall Street analysts.

For the quarter, the miner posted a net loss of US$1.2 billion or US$1.02 per share, on revenue of US$1.9 billion, compared with a net loss of US$314 million, or US$0.27 per share, on revenue of US$2.2 billion a year earlier. On an adjusted basis, the company posted net earnings of US$0.06 per share, which matched the average forecast of analysts. Revenue fell short of the US$1.96 billion consensus estimate.

Shares of the company fell 2.1% to US$13.09 in Wednesday’s New York pre-market trading.

READ: Barrick Gold's 3Q profit weakens, revenue drops as metals prices continue to slide

The Toronto-based company generated annual revenue of US$7.24 billion, operating cash flow of US$1.77 billion and free cash flow of US$365 million. Barrick reported a net loss of US$1.55 billion in 2018, primarily because of a net impairment charge of US$900 million related to the Veladero and Lagunas Norte mines.

A focus on capital discipline, according to the company, allowed it to increase investments in organic growth and significantly reduce debt, while raising returns to shareholders.

In 2018, the company produced 4.53 million ounces of gold at a cost of sales of US$892 per ounce and all-in sustaining costs of US$806 per ounce. That is among the lowest for major gold companies, according to Barrick.

The miner completed its merger with Randgold Resources Ltd on January 1.

Contact Dennis Fitzgerald at dennis@proactiveinvestors.com

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Wed, 13 Feb 2019 08:19:00 -0500 https://www.proactiveinvestors.com/companies/news/214553/barrick-shares-drop-after-mining-giant-misses-4q-wall-street-revenue-estimate-214553.html
<![CDATA[News - Gold consolidates above US$1,300, and could go higher ]]> https://www.proactiveinvestors.com/companies/news/213502/gold-consolidates-above-us1300-and-could-go-higher-213502.html The price of gold is now consolidating above the US$1,300 mark, following Friday’s upward move.

Plenty of analysts and industry watchers expect it to stay at current levels or even push higher, as the global appetite for risk wanes and investors move once again into safe-haven assets.

The underlying causes for this move aren’t too hard to find: The broad context is the ongoing uncertainty about the global economy, particularly in regard to the swings in sentiment around US-China trade talks.

Then there’s the new cautious note being sounded by the Federal Reserve. According to the consensus view in the market, and contrary to its former position, the Fed will probably not raise rates at all this year. Not everyone agrees with that prognosis, though. ING put out a dissenting view arguing that there will likely be two rate rises, in spite of the new prevailing caution.

Fed's balance sheet

But there is an additional factor regarding the Fed, which the market is beginning to take account of. Not only is the Fed looking to raise rates where it can, but it’s also looking to pare back its balance sheet significantly.

The Fed’s balance sheet ballooned from the high hundreds of billions of dollars to more than US$4tn after the global financial crisis, but in recent months, under the stewardship of Jerome Powell, this is being pared back somewhat.

Not everyone likes that policy, including the man who appointed Mr Powell, Donald Trump, and it has been blamed for stoking market volatility. When Mr Powell said the programme of asset sales remained on “automatic pilot” last year, the S&P dropped heavily. And in turn, when later he said that it was actually “flexible”, the S&P delivered its best gains over an hourly period in 12 months.

At issue is a scarcity of reserves in the Fed itself, as banks withdraw assets in response to the Fed’s own paring. And that’s making markets jittery. Some argue that the Fed will have to slow down, and it may be that some such announcement is forthcoming in the policy statement due on Wednesday.

But either way, the uncertainty makes for a more attractive environment for gold.

Global woes

Add in secondary factors like the Brexit crisis in the UK, a general slowing of the European economy, most notably in Germany, and the weakening of the dollar after the shutdown of the US government appeared to end in defeat for Donald Trump, and the immediate outlook is certainly favourable.

An escalation of the developing crisis in Venezuela could be another flashpoint.

Over the last week shares in Barrick Gold Corporation (NYSE:GOLD) have moved up by more than a dollar to US$12.34. That move followed a period of short-term weakness following the completion of the combination with Randgold Resources. But there are plenty of Barrick bulls to be found out there now that gold is back above US$1,300 for the first time since the early part of last year.

 

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Tue, 29 Jan 2019 10:00:00 -0500 https://www.proactiveinvestors.com/companies/news/213502/gold-consolidates-above-us1300-and-could-go-higher-213502.html
<![CDATA[News - Barrick Gold's 3Q profit weakens, revenue drops as metals prices continue to slide ]]> https://www.proactiveinvestors.com/companies/news/207796/barrick-gold-s-3q-profit-weakens-revenue-drops-as-metals-prices-continue-to-slide-207796.html It was a busy quarter for mega-gold miner Barrick Gold, which recently announced a transformational all-share merger with Randgold Resources Ltd. in an attempt to put together an industry-leading gold company.

Barrick reported a net loss of $412 million ($0.35 per share) and adjusted net earnings of $89 million ($0.08 per share) for the third quarter.

READ: Barrick Gold and Randgold Resources merge to create world's largest gold miner but questions still remain

The company said the net loss primarily reflects a $405 million impairment charge at the Lagunas Norte mine in Peru.

"Gold production increased to 1.15 million ounces in the third quarter, while cost of sales on a per ounce basis3 was approximately four percent lower than the second quarter of 201," said the company in a statement. 

Third quarter operating cash flow was $706 million, and free cash flow of $319 million, was significantly higher than the second quarter of 2018. 

The company said gold production increased to 1.15 million ounces in the third quarter, while cost of sales on a per ounce basis was approximately 4% lower than the second quarter of 2018.

The company said all-in sustaining costs and cash costs were down by roughly 8% and 3%, respectively, over the same period.

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Wed, 24 Oct 2018 20:24:00 -0400 https://www.proactiveinvestors.com/companies/news/207796/barrick-gold-s-3q-profit-weakens-revenue-drops-as-metals-prices-continue-to-slide-207796.html
<![CDATA[News - Fear bolsters gold stocks as volatile markets generate safe-haven buying ]]> https://www.proactiveinvestors.com/companies/news/206924/fear-bolsters-gold-stocks-as-volatile-markets-generate-safe-haven-buying-206924.html Pervasive fear of a market rout is driving shares of major gold companies higher as investors flee to the traditional safe haven of the yellow metal, data compiled by Proactive Investors showed Thursday.

From South Africa to Canada, the United States to Australia, stocks of the biggest gold producers in the world lifted higher one day after the Dow Jones Industrial Average posted its third-biggest single-day point loss in history as the index dove 830 points during the session.

Barrick Gold (TSX:ABX) stock climbed 9.76% to settle at C$16.475. Barrick was ranked as the biggest gold mining company in the world in 2017, according to specialist website Mining.com. Goldcorp Inc (TSX:G) saw its shares in Toronto climb 7.42% to close at C$14.18. 

Like most major gold companies, the two have their shares also listed in New York.

Goldcorp (NYSE:GG) stock in New York was up 6.92% to finish at US$10.81 while those of Barrick (NYSE:ABX) jumped 9.57% to end at US$12.60.

"Gold is finding a bit of support from the global sell-off seen in equities. If this (sell-off) persists, we will start seeing more of a move to gold as a safe-haven asset," ING analyst Warren Patterson said in a report by Reuters.

READ: US economic strength has been purchased at the price of a massive monetary expansion, which in turn puts a floor on the gold price

SPDR Gold Shares (NYSE:GLD), the largest physically backed gold exchange-traded fund in the world, was 2.52% higher to end at US$115.72.

South African gold company DRDGold Ltd's (NYSE:DRD) US-listed shares added 4.48% to settle at US$2.33.

In South Africa, AngloGold Ashanti Ltd (JSE:ANG) (NYSE:AU) stock jumped 9.18% to close at 13,688 rand. The stock of the third-biggest world miner in New York rose 9.52% to settle at US$9.66.

Gold Fields Ltd (JSE:GFI) (NYSE:GFI) rose 6.95% to finish at 3,860 rand. In New York, the stock closed up 6.27% to US$2.80.

READ: Barrick Gold and Randgold Resources merge to create world's largest gold miner but questions still remain

In the US, shares of Denver-based Newmont Mining (NYSE:NEM) went up 7.04% to end at US$32.71. The company is ranked as the second biggest gold mining company in 2017.

Stock of Kinross Gold Corp (TSE:K) (NYSE:KGC) in Canada gained 4.31% to conclude at C$3.87 while rising 4.59% to end at US$2.96 in New York.

Newcrest Mining Ltd (ASX:NCM) (OTC:NCMGY) was the only stock so far on Thursday not to post gains as it ended in Australia nearly flat at A$19.30, off A$0.01 for the day. In New York, the share was up 3.46% to close at US$14.12.

"Rising US yields and general strength in the dollar have meant that investors have largely ignored gold. But people are seeing fairly good value at current levels on the back of some macro concerns," Patterson said.

Reporting by Rene Pastor, contactable at rene.pastor@proactiveinvestors.com 

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Thu, 11 Oct 2018 11:06:00 -0400 https://www.proactiveinvestors.com/companies/news/206924/fear-bolsters-gold-stocks-as-volatile-markets-generate-safe-haven-buying-206924.html
<![CDATA[News - Barrick Gold and Randgold Resources merge to create world's largest gold miner but questions still remain ]]> https://www.proactiveinvestors.com/companies/news/205572/barrick-gold-and-randgold-resources-merge-to-create-world-s-largest-gold-miner-but-questions-still-remain-205572.html As gold prices edged slightly higher Monday, the world's newest, and largest, gold miner was confirmed.

Canada's Barrick Gold Corp (TSE:ABX NYSE:ABX), the mega-gold producer, announced news that it had merged with rival Randgold Resources Ltd (LON:RRS) in an all-share deal to create the world's largest gold miner, valued at US$18.3 billion.

Fact-checkers could argue: Barrick has already held the "largest gold company in the world" crown in previous years. Either way, adding Randgold is icing on the cake.

The merger created a mammoth gold company, in an era where there have not been any significant mergers in some time. Combined, both companies own a number of the world's most valuable gold fields and produce around 6.6 million ounces of gold a year.

READ: Randgold Resources and Barrick Gold confirm plans for US$18.3bn merger

Shares of Barrick Gold were up 5.8% at C$14.30 midday Monday. Shares of Randgold Resources were up 6% to 5,220p.

“Initial investor reaction to the creation of the world’s biggest gold miner by market capitalisation seems favourable, as Randgold Resources’ shares are up and dragging those of other precious metals explorers higher for good measure,” said Russ Mould, AJ Bell investment director, in a release. AJ Bell is one of the largest investment platforms in the UK. 

But a number of questions still remain, which include: What does the deal say about struggling gold prices? And is the boom in mergers and acquisitions activity a good or a bad thing for the gold sector? 

“The fact that the pros are buying gold and the punters are selling it is interesting – and could suggest that Barrick and Randgold Resources are positioning themselves for an upturn in gold by getting leaner and meaner, even if skeptics of the deal will argue it is a defensive measure prompted by necessity and lean times for their main product," said Mould. 

Under the terms of the deal, each Randgold shareholder will receive 6.1280 new Barrick shares for each share of the African rival, the companies announced in a release. Barrick shareholders will own two-thirds of the combined firm and Randgold will own the remaining third.

Randgold to cancel shares on London Stock Exchange and Barrick Group will list in Toronto and New York

Randgold shares on the London Stock Exchange will be canceled and New Barrick Group will list in Toronto and New York, operating under the branding of the Barrick Group.

In the past year, shares of both Barrick and Randgold have lost almost 30% amid falling gold prices and questions over strategies.

"The boards of Barrick and Randgold believe that the merger will create an industry-leading gold company with the greatest concentration of Tier One Gold Assets in the industry, the lowest total cash cost position among senior gold peers," the companies said together in a joint statement.

Deal received with 'mixed reception'

"It's a deal that's been received with mixed reception from analysts and investors," Mining Capital's Alastair Ford told Proactive Investors. "On the whole, I think, broadly positive as there will be significant savings generated by both companies, as well as economies of scale."

Ford says that the deal will generate significant cost savings for both groups, as well as bolstering each other's geographical spread.

However, Ford adds that the merger will open a void in the London market, with speculation around who will fill the gap left by Randgold.

"Randgold and Barrick have signalled that they will cancel the London listing so that will leave the London gold market empty of any major gold miner to invest in and will probably open up a bit of a void, actually and there will be some interesting activity to see, in terms of who will fill that gap and where investors will put their money." 

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Mon, 24 Sep 2018 12:28:00 -0400 https://www.proactiveinvestors.com/companies/news/205572/barrick-gold-and-randgold-resources-merge-to-create-world-s-largest-gold-miner-but-questions-still-remain-205572.html
<![CDATA[News - Barrick Gold strikes deal with Tanzania, sending Acacia Mining shares higher ]]> https://www.proactiveinvestors.com/companies/news/185906/barrick-gold-strikes-deal-with-tanzania-sending-acacia-mining-shares-higher-185906.html Canadian mining major Barrick Gold Corp (NYSE:ABX) has struck a deal with the Tanzanian government to resolve a dispute, which has hit operations in the country, sending shares in its London-listed subsidiary Acacia Mining PLC (LON:ACA)  surging.

Barrick agreed the African country would take a 16% stake in three gold mines operated by Acacia, a 50% share in revenues from the mines and a one-off payment of $300mln (£228m).

Reuters reported  that Barrick's chairman John Thornton said the deal would need to be approved by independent shareholders and directors of Acacia Mining.

Acacia said it had received a copy of the framework agreement referred to in a regulatory release by Barrick and was seeking further clarification.

"No formal proposal has been put to Acacia for consideration at this point in time," it said.

Acacia shares surged almost 17% to 213.50p late on Thursday.

Barrick has been in talks with Tanzania for months after it banned the export of unprocessed minerals and enacted new laws to raise state ownership of the nation's mines.

The East African country is the continent’s fourth largest gold producer.

"Following constructive discussions with our Tanzanian partners, we have developed a framework for a modern, 21st century partnership that should ensure Acacia's operations generate sustainable benefits and mutual prosperity for the people of Tanzania, as well as for the owners of Barrick and Acacia," said Barrick's executive chairman John Thornton.

"A partnership requires trust between the parties, and transparency is the currency of trust. Through our discussions over the last three months we have established both and this will form the basis of our relationship in the future."

Barrick holds a 63.9% interest in Acacia, which is operated independently of Barrick.

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Thu, 19 Oct 2017 11:49:00 -0400 https://www.proactiveinvestors.com/companies/news/185906/barrick-gold-strikes-deal-with-tanzania-sending-acacia-mining-shares-higher-185906.html
<![CDATA[News - Barrick Corp is Jefferies top gold pick ]]> https://www.proactiveinvestors.com/companies/news/171409/barrick-corp-is-jefferies-top-gold-pick-171409.html Barrick Gold Corp (TSX:ABX NYSE:ABX) is US broker Jefferies' top pick in the North American gold sector for its ongoing debt reduction, asset quality, and low costs.

While the broker concedes that Barrick shares will ultimately move with the gold price, it believes several 'self-help' measures should boost investment returns and the share price.

Over the past two years debt has shrunk by US$5bn. The aim now is to reduce borrowings by a further US$3bn to US$5bn and eventually eliminate it completely.

The mothballed Pascua-Lama development in South America, meanwhile, could potentially boost Barrick's production significantly over the next few years through the new phased approach recently proposed by the company.

Jefferies also sees some help from the gold price.

Since Donald Trump’s November US presidential election victory the spot price for the metal has dropped by around US$90 per oz.

The broker lowered its forecast for the gold price at the start of 2017 but expects a recovery through the year  and further out a price of around US$1,300 per ounce to stick.

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Tue, 10 Jan 2017 13:38:00 -0500 https://www.proactiveinvestors.com/companies/news/171409/barrick-corp-is-jefferies-top-gold-pick-171409.html
<![CDATA[News - Barrick Gold considering selling Acacia stake - reports ]]> https://www.proactiveinvestors.com/companies/news/128707/barrick-gold-considering-selling-acacia-stake-reports-128707.html Barrick Gold (TSE:ABX; NYSE:ABX), the world's largest gold miner, is reportedly considering selling its 64% in Acacia Mining as part of a plan to become debt free.

The firm has approached numerous South African, Australian and North American miners about a sale in the stake said to be worth around US$1.9bn, according to news agency Reuters, which also cites  Harmony Gold, AngloGold Ashanti as potential buyers.

South African broker and investment bank Investec said: " The Barrick stake has been a question over Acacia for years, generally one of when do they divest and but more recently will they bring it all back into the fold.

"Acacia is now the most attractive it has ever been (operationally) but the trouble is that it is also close to highest valued it has ever been."

According to Reuters, three of the top five mining companies globally will have to boost their asset sales in the second half to meet disposal targets, which total about US$14bn.

They are Glencore (LON:GLEN), Anglo American (LON:AAL)) and Vale.

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Wed, 27 Jul 2016 10:35:00 -0400 https://www.proactiveinvestors.com/companies/news/128707/barrick-gold-considering-selling-acacia-stake-reports-128707.html
<![CDATA[News - Barrick Gold stabilises after heavy cut-backs ]]> https://www.proactiveinvestors.com/companies/news/125250/barrick-gold-stabilises-after-heavy-cut-backs-125250.html Gold sector bellwether Barrick Gold (NYSE:ABX) kept its production forecast this year unchanged despite lower revenues and output in the first three months.

Revenues fell 14% to US$1.93bn due to a weaker gold price and 8% decline in production to 1.18mln ounces.

Including one-off charges the world's largest gold miner posted a loss of US$83mln.

Underlying profits rose to US$127mln or 11c per share in the three months to March from US$62mln or 5c this time a year ago.

Barrick has been in retrenchment mode for three years now. Asset sales to reduce debts affected production and Barrick repeated it expects to produce between 5-5.5mln ounces this year.

That compares with 8mln ounces per year recently but Barrick is now focused on growing its cash flow.

“Our over-arching objective as a business is to grow our free cash flow per share in any foreseeable gold price environment,” it said.

The cash inflow totalled US$181mn in the first quarter to make four quarters in a row now it has generated cash.

The miner reduced its forecast of average all-in-sustaining–costs to between US$760-810 per ounce from US$775 to US$825 per ounce.

Debt reduced by US$842mln and Barrick said it is on target is to reduce debt by a further US$2bn in 2016.

Shares rose 1% to US$16.33.

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Tue, 26 Apr 2016 09:46:00 -0400 https://www.proactiveinvestors.com/companies/news/125250/barrick-gold-stabilises-after-heavy-cut-backs-125250.html
<![CDATA[News - Brokers - Mackie downgrades Barrick Gold and IAMGOLD ]]> https://www.proactiveinvestors.com/companies/news/122749/brokers-mackie-downgrades-barrick-gold-and-iamgold-122749.html Broker Mackie has downgraded gold giant Barrick Gold (NYSE:ABX) from 'buy' to a 'hold' on valuation grounds and says the firm is getting on with life as a "senior gold producer".

The market has recognised the improvements the world's biggest gold miner is making in its underlying performance, notes analyst Barry Allan.

Since the third quarter of fiscal 2015,  the shares have performed nicely, rising off all-time lows and rising over 100%, he notes.

The group's 2015 production beat forecast with output of 6.12 million ounces better than the broker's 6.04 Moz forecast, largely due to excellent operating performance at Goldstrike and Cortez mines.

Meanwhile, the direct operating costs of US$596/oz were well below Mackie's US$615/oz forecast.

"As 2015 results confirm, ABX has made good strides in solving an over-leveraged balance sheet and halting the development of questionable projects of low-return.

"The attention has shifted to getting the best from its core mines, which operating results have shown to be a good strategy. While further assets sales are anticipated, the overwhelming shift will be to maximize operating results."

Meanwhile, the same broker reckons IAMGOLD (NYSE:IAG) is still a share to avoid, and puts its rating down to 'sell' from 'hold'.

"With a flat to declining production profile for 2016 and 2017, and a relatively high, all-in cost of ~US$1,200, other than the potential for higher gold prices, there is no fundamental reason to be involved with the stock," notes Mackie.

The group is still treading water and going nowhere, it suggests..

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Fri, 19 Feb 2016 08:26:00 -0500 https://www.proactiveinvestors.com/companies/news/122749/brokers-mackie-downgrades-barrick-gold-and-iamgold-122749.html
<![CDATA[News - Barrick Gold to write down $3bn in assets; shares waver ]]> https://www.proactiveinvestors.com/companies/news/121677/barrick-gold-to-write-down-3bn-in-assets-shares-waver-121677.html Barrick Gold (TSE:ABX) (NYSE:ABX), the world's biggest gold producer, said it expects to take charges of up to $3bn following an annual accounting impairment review. Shares fluctuated.

The Toronto, Ontario-based company said in a statement late Thursday that it may have to take a goodwill impairment charge of about $1.8bn, and asset impairment charges of $1.0-$1.2bn, based on its preliminary analysis.

The asset writedown is primarily attributed to its Pascua-Lama mining project, on the border of Chile and Argentina, and its Pueblo Viejo project in Dominican Republic.

Barrick also said it met its $3bn debt reduction target through non-core asset sales.

Barrick has been working hard to improve its balance sheet after gold prices slumped for three straight years.

Barrick said it will provide an update on the writedowns on February 17 when it reports detailed financial and operating results for the year ended December 31.

The write downs are non-cash items that reflect the reduced long-term value of the assets.

Shares were up 1.3% at C$12.05 at 1:25 p.m. in Toronto, after falling to as low as $11.46. The stock has lost 24% over the past year, but it is up 18% this month.

The company lowered its gold price assumption to $1,000 an ounce for 2016 and to $1,200 long term.

“In line with our objective of generating positive returns in virtually any foreseeable gold price environment, we have decided to use pricing for our impairment testing that is prudent in current market conditions,” Barrick President Kelvin Dushnisky said in the statement.

Barrick also said its preliminary 2015 production was 6.12mln ounces of gold, in line with the company’s latest guidance of 6 million to 6.15mln ounces.

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Fri, 22 Jan 2016 13:37:00 -0500 https://www.proactiveinvestors.com/companies/news/121677/barrick-gold-to-write-down-3bn-in-assets-shares-waver-121677.html
<![CDATA[News - Barrick Gold waiting for Newmont's call ]]> https://www.proactiveinvestors.com/companies/news/114524/barrick-gold-waiting-for-newmont-s-call-114524.html Barrick Gold (TSE:ABX, NYSE:ABX) is waiting for Newmont Mining (NYSE:NEM) to contact it about taking full control of Australia's Super Pit mine.

Barrick, the world's biggest miner, has been busy cutting its debt mountain by selling off assets, but the 50% holding in the Super Pit gold mine has yet to be sold.

Newmont owns the other half of the Super Pit mine, and last week Newmont boss Gary Goldberg told news agency Reuters that the company would be interested in buying out Barrick, at the right price.

Barrick adviser and former president of the company, Jim Gowans, said on Thursday that discussions on a potential sale have yet to kick off.

 

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Thu, 01 Oct 2015 08:31:00 -0400 https://www.proactiveinvestors.com/companies/news/114524/barrick-gold-waiting-for-newmont-s-call-114524.html
<![CDATA[News - Barrick Gold scraps co-president model ]]> https://www.proactiveinvestors.com/companies/news/114523/barrick-gold-scraps-co-president-model-114523.html Barrick Gold (TSE:ABX), the world’s largest bullion miner by production, named Kelvin Dushnisky as sole president, effective immediately.

Barrick is scrapping its unusual “co-president” management structure less than a year after it went into effect, as part of its efforts to become a more efficient gold miner. It will also continue to go without a chief executive officer, which is highly unusual for such a large company. 

Dushnisky previously held the title of co-president along with Jim Gowans, who will act as senior adviser to Chairman John Thornton until Gowans retires from the company at the end of the year, the Toronto, Ontario-based company said in a statement on Monday.

Richard Williams, who was chief of staff, has become chief operating officer, reporting to the newly appointed president.

Another Barrick executive, Basie Maree, has been named chief technical officer, reporting to Williams.

The changes are the latest in a string of management reshuffles at the miner in recent years. Last year, the company eliminated the CEO role and strengthened Thornton's role within the company. 

“As we work to accelerate Barrick’s return to the lean, decentralized model that drove the company’s early success, the time is right to put a structure in place that supports this vision,“ Thornton said in the statement.

Both Dushnisky and Williams are now the main executives responsible of assuring the Barrick reaches its goal of cutting costs by $2bn by the end of 2016.

Shares gained 2.4% to C$10.31 at 11.22 am. in Toronto, paring this year’s slump to 18%.

 

 

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Mon, 17 Aug 2015 11:43:00 -0400 https://www.proactiveinvestors.com/companies/news/114523/barrick-gold-scraps-co-president-model-114523.html
<![CDATA[News - Barrick sells 50% of its statke in Papu New Guinea gold mine ]]> https://www.proactiveinvestors.com/companies/news/107368/barrick-sells-50-of-its-statke-in-papu-new-guinea-gold-mine-107368.html

Shares of Barrick Gold (TSE:ABX) (NYSE:ABX) were trading about 3.4 percent lower today, after the company announced has sold 50% of its stake in the Porgera joint venture that operates a gold mine in Papua New Guinea to China’s Zijin Mining Group.

Barrick, the world’s largest gold producer and 95% owner of the Porgera through the company Barrick Niugini, obtained US$298 million in cash for its stake. The government of the Papuan province of Enga and local owners hold the remaining 5%.

“Our partnership with Zijin is the first step in a long-term strategic relationship with one of China's leading mining companies—a multi-faceted partnership that will provide significant opportunities to work together on an ongoing basis as we continue to create value for our respective owners," said Barrick’s chairman John Thornton in a statement.

In 2014, the mine yielded 493,000 ounces of gold.

Barrick’s sale is part of a plan to divest a dozen of what it considers as secondary assets, such that it can operate on a leaner basis, preserving only the richest and most profitable deposits, concentrating its activity in the Americas.

The group also intends to use the proceeds of this sale to reduce debt, which exceeds US$20 billion. Yesterday, Barrick said it sold another gold mine in Australia to a local company for US$550 million.

Barrick, which suffered consecutive losses in 2013 and 2014 with respective losses of 10.4 and 2.9 billion USD, is pursuing a US$3 billion debt reduction strategy this year.

Barrick also signed a long term strategic cooperation agreement with Zijin Mining, which could see the two participate in other mining projects, according to a joint statement.
 
Under the agreement, Barrick and Zijin will each appoint three directors to the board of Barrick Niugini, which holds 95% of the Porgera Joint Venture. One party will appoint the general manager of the mine while the other will name his deputy and the chairman of the board.

Greg Walker, Porgera’s current and Barrick appointed director, will remain in office, but it is understood that Zijin’s role in Porgera will expand as its managers gain experience in Papua New Guinea.

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Tue, 26 May 2015 13:01:00 -0400 https://www.proactiveinvestors.com/companies/news/107368/barrick-sells-50-of-its-statke-in-papu-new-guinea-gold-mine-107368.html
<![CDATA[News - Barrick Gold to sell Cowal mine for $550 mln to Evolution Mining ]]> https://www.proactiveinvestors.com/companies/news/107300/barrick-gold-to-sell-cowal-mine-for-550-mln-to-evolution-mining-107300.html Barrick Gold (TSE:ABX), the world's top gold producer, has agreed to sell its Cowal mine to Evolution Mining for $550 million in a deal that will turn Evolution into Australia's second largest producer of the precious metal. Shares gained.

The Toronto-based gold miner said in a statement yesterday that it will use the money from the sale to pay down debt. 

Barrick has been looking to sell non-core assets as it streamlines its operations and cuts costs.It said in February that it plans to reduce net debt by at least $3 billion this year, partly by selling Cowal and the Porgera joint-venture in Papua New Guinea. 

Last month, Barrick said it began a process to sell a stake in its Zaldivar copper mine in Chile.

“The sale of Cowal is consistent with the strategy we have outlined to create long-term value for our owners, making a significant contribution to our debt reduction target while further focusing the geographic footprint of our portfolio,” said Barrick Co-President Kelvin Dushnisky.

Barrick said the divestment of Cowal will also contribute to reduced general and administrative costs as Barrick completes the closure of its office in Perth, Australia. 

The deal is expected to be completed in the third quarter of 2015.

Shares were up 0.3 percent at C$15.16 at 10:41 a.m. in Toronto. The stock has gained 21 percent this year.

Barrick has sold six mines for a total of US$1.3 billion since 2012, five of which are in Australia, the largest gold producing nation after China. Its 50% stake in the Kalgoorlie Super Pit operation is Barrick’s only remaining Australian gold-mining interest.

Evolution Mining was created in late 2011 as a mid-tier Australian gold producer through a merger of Catalpa Resources and Conquest Mining. 

Evolution currently operates five gold and silver mines in Queensland and Western Australia. For the year ended June 30, 2014 the company produced approximately 428,000 gold equivalent ounces.

Credit Suisse is acting as financial advisor to Barrick. Davies Ward Phillips & Vineberg LLP and Herbert Smith Freehills LLP are acting as legal counsel to Barrick.

 

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Mon, 25 May 2015 11:07:00 -0400 https://www.proactiveinvestors.com/companies/news/107300/barrick-gold-to-sell-cowal-mine-for-550-mln-to-evolution-mining-107300.html
<![CDATA[News - Barrick to sell Zaldivar and other major assets after weaker quarterly results ]]> https://www.proactiveinvestors.com/companies/news/106456/barrick-to-sell-zaldivar-and-other-major-assets-after-weaker-quarterly-results-61218.html

Barrick Gold (TSE:ABX) (NYSE:ABX) said it would sell its stake in the Zaldivar copper mine in Chile's Antofagasta Region, one of the two copper assets it owns in the country. The decision comes as the world’s number one gold producer plans to cut debt by at least US$3 billion this year.

Barrick had recently announced the start of the process to sell its Cowal mine in Australia and JV Porgera in Papua New Guinea.

"Zaldivar maintains a solid and consistent performance in the best jurisdiction in the world for mining of copper. The potential buyers have expressed significant interest in acquiring the mine," said Barrick in a statement.

According to the Chilean Copper Commission (Cochilco), Zaldivar produced 100.600 tonnes of copper in 2014.

The Toronto based company said that the sale of Zaldivar is just one of several initiatives that the company is considering in an effort to improve the balance sheet after the company announced quarterly results that fell well short of expectations, as net profit fell by 38% compared to the same period a year ago.

The gold giant said it earned US$57 million or 5 cents per share, half of analysts’ expectations of 10 cents, in the first quarter 2015 against 88 million or 20 cents per share in the same period last year.

Revenues continued to slide, dropping 15% for the quarter to US$2.245 billion from the US$2.647 billion achieved a year earlier.

Barrick has felt the effects of the drop in gold prices, which are some 6% lower than a year ago (US$1218/oz. on average).

Sales volumes meanwhile fell by 14.5% in one year, to 1.385 million ounces as gold is overpowered in its usual safe haven role by a strengthening US economy and looming interest rate hike. Also, production volume was 12.5% ​​lower than a year ago.

Reiterating its determination to reduce operating costs by 20% for the second half 2015, Barrick said it has already achieved  US$200 million in savings on its planned capital expenditures for 2015.

At the same time, the Canadian company was excited about the discovery of a new deposit in Alturas, Chilean Andes, where the company plans to continue exploratory drilling until the end of May. So far, the firm has completed 35 holes, uncovering significant mineralization.

Barrick also announced that it is a plan to extend the life of Lagunas Norte, in order to exploit the mineral refractory oxide deposit under the current mine. The Canadian company will start a feasibility study for the project.

In the past six months several companies have sold or announced the sale of some of their Chilean assets in Chile. Freeport McMoRan sold its Candelaria mine to Lundin Mining, while Anglo American is considering disposing of its assets in Mantos Blancos and Mantoverde.

Barrick still considers the core of growth strategy to rely on its five mines in the Americas, since 60% of its production comes from Veladero (Argentina), Lagunas Norte (Peru), Pueblo Viejo (Dominican Republic) and Cortez and Goldstrike (Nevada).

While Barrick reaffirmed that his focus is on gold, also he announced that it has signed a five year agreement with Quantum Pacific Exploration (QPX) to explore copper deposits in northern Chile. The companies will contribute US$30 million each to the project.

 

 

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Wed, 29 Apr 2015 10:17:00 -0400 https://www.proactiveinvestors.com/companies/news/106456/barrick-to-sell-zaldivar-and-other-major-assets-after-weaker-quarterly-results-61218.html
<![CDATA[News - Chilean court says Barrick’s Pascua Lama project has not damaged glaciers ]]> https://www.proactiveinvestors.com/companies/news/106068/chilean-court-says-barricks-pascua-lama-project-has-not-damaged-glaciers-60644.html A Chilean Court has ruled that Canadian miner Barrick Gold (TSE:ABX) (NYSE:ABX) did not damage the glaciers located in the area of the Pascua-Lama gold project.

Barrick’s bi-national mine, burrowed in the Andes between Argentina and Chile, has been left idle because of a Chilean Court order until it completes water management work that was not performed as outlined in the conditions of a mining permit.

"We are pleased that the court has confirmed what the technical and scientific evidence demonstrates, that these ice bodies have not been damaged by activities at the Pascua-Lama project," said Barrick's Executive Director for Chile, Eduardo Flores, in a statement released Monday.

The lawsuit was filed in 2012 by residents of the area close to the project and the environmental group OLCA, alleging the risk of a negative impact on the Toro 1, Toro 2 and Esperanza glaciers.

The ‘Second Environmental Court of Santiago’, in Chile, has now ruled that "no damage was done to the glaciers. They have evolved in a similar manner to the ice bodies identified as a reference to monitor the project."

Environmental groups have expressed fears over the potential and unpredictable effects of the project’s mining activity in the glaciers, also denouncing a reduction in water availability for the population. Barrick and its partners have argued that the impact would be small.

The glaciers have to be displaced in order to allow for mining activities. This would involve the use of 27 metric tons of cyanide a day and 33 million litres of water per day to extract gold, threatening to the region’s agriculture and water supply. Barrick had also not hidden the fact that it would use some 38 metric tons of explosives a day to blast mountain tops into rocks.

Residents of the area have opposed the project, also claiming that the firm did not properly consult indigenous communities, which are guaranteed rights by the International Labour Organization (ILO).

Barrick said in a statement that "the Pascua-Lama team has focused on resolving outstanding legal and regulatory barriers" and is committed to working with local communities to advance the project.

"Preserving and protecting glaciers from harm is essential to the work we do every day at Pascua-Lama…That is why Barrick worked with leading independent experts and glaciologists to develop and implement one of the most rigorous glacier monitoring programs anywhere in the world," said Flores.

The resolution of the dispute comes just months after Chile’s environment regulator (SMA) warned in January that it would re-launch a sanction process against the Pascua Lama project, aimed at revoking its mining license.

The SMA, meanwhile, said last week that it would continue to review Barrick’s compliance with the mitigation measures it has been ordered to adopt.

The US$8.5 billion Pascua-Lama project is one of Barrick’s most important and riskiest projects and it was supposed to start operations in 2014. The open pit mining asset is rich in gold, silver, copper and other minerals.

The project is located in the southern reaches of the Atacama Desert, overlapping the border across the Andes between Chile and Argentina at an altitude of over 4,500 metres.

Barrick has estimated that Pascua-Lama contains 17 million ounces of gold and 635 million ounces of silver.

The Pascua Lama gold project was closed in 2013 for environmental breaches on the Chilean side, and the fate of the mega project was put on hold, with the company suffering a US$5.1 billion writedown. Barrick said its team is focused on resolving the outstanding legal and regulatory hurdles at the project, completing a new plan to optimize remaining construction activities and minimize ongoing costs.

The mining minister of Argentina’s San Juan province has indicated that China’s Zijin Mining is interested in the Pascua project after visiting the mine site several times.

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Wed, 25 Mar 2015 09:48:00 -0400 https://www.proactiveinvestors.com/companies/news/106068/chilean-court-says-barricks-pascua-lama-project-has-not-damaged-glaciers-60644.html
<![CDATA[News - Barrick mulls sale of Chilean copper mine to cut losses; report ]]> https://www.proactiveinvestors.com/companies/news/105921/barrick-mulls-sale-of-chilean-copper-mine-to-cut-losses-report-60431.html

Barrick Gold (TSE:ABX) (NYSE:ABX) is mulling the sale of the Zaldivar copper mine in Chile to cut debt and losses, according to a report in the Financial Times, which cited bankers and mining executives.

In February, Barrick announced a fourth quarter net loss of $2.85 billion. The company posted a similar loss for the same quarter in 2013, and currently has total outstanding debt of US$11.65 billion.

The sale of Zaldivar, one of Barrick's largest assets, could generate some US$1.5 billion, the newspaper said, and draw interest from Chinese companies and private equity firms.  

The sale would be part of a US$3 billion debt reduction strategy announced earlier this year. As part of the plan, Barrick said last month it had already started the process to sell its Cowal mine in Australia and a joint venture in Papua New Guinea.

Zaldivar produces about 126,000 tons of copper per year and is located next to the world’s largest copper mine: Escondida, which is co-owned and managed by BHP Billiton (NYSE:BHP) and Rio Tinto (NYSE:RIO).

The Zaldivar copper mine is located in the foothills of the Antofagasta region, at a height of 3.300 metres. Its construction required an investment of US$600 million and production started in August 1995, with a capacity of 125,000 tons.

Last February, Barrick endured a US$2.8 billion after-tax impairment charge. The gold miner took a writedown on its Lumwana copper mine in Zambia after the African country raised the royalty rate on the country's open pit mining operations from 6 to 20 percent. Barrick also sold its Cerro Casale project in Chile over lower gold and copper prices.

Barrick Chairman John Thornton wants to restore profitability by focusing on gold mining, with no plans to bolster its cooper operations: "We believe the only way to recapture that is to consciously go back to the future and understand who we were, what made us distinctive, what gave us our purpose and our values and reinterpret that for the 21st century."

Last November, Barrick was discussing plans to allow Chinese state-owned Zijin Mining Group to revive the bungled Pascua-Lama project.

When the Pascua Lama gold project was closed in 2013 for environmental breaches on the Chilean side, no one knew what would happen to the bi-national (Argentina-Chile) mega project, which cost Barrick US$5.1 billion in writedowns. 

The mining minister of Argentina’s San Juan province has indicated that Zijin wants to invest in Pascua after visiting the mine site several times, potentially suggesting that China's Zijin could also be interested in additional Barrick assets in Chile.

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Mon, 16 Mar 2015 11:03:00 -0400 https://www.proactiveinvestors.com/companies/news/105921/barrick-mulls-sale-of-chilean-copper-mine-to-cut-losses-report-60431.html
<![CDATA[News - Barrick reports $2.8 bln writedown, though adjusted profit beats; to sell two mines ]]> https://www.proactiveinvestors.com/companies/news/105563/barrick-reports-28-bln-writedown-though-adjusted-profit-beats-to-sell-two-mines-59958.html Barrick Gold (NYSE:ABX) (TSE:ABX) has reported a multi billion-dollar net loss in the fourth quarter, pointing to massive impairment charges on mine projects in Africa and Chile, but adjusted earnings beat expectations.

Canada's second-largest gold miner by market capitalization is also putting its Porgera and Cowal operations up for sale and setting a major debt reduction target for 2015 as the company starts to implement a long-discussed strategy to become leaner and less centralized.

The Toronto-based company’s U.S.-listed shares advanced as much as 3.1 percent in New York trading today. The stock has lost 35 percent over the past six months, but is up 14 percent so far this year.

Net loss was $2.85 billion, or $2.45 per share, in the October-to-December quarter,  compared a net loss of $2.83 billion, or $2.61 billion, Barrick said in a statement late yesterday.

The quarterly loss reflected the impact of booking $2.8 billion in after-tax impairment charges related mostly to its Lumwana mine in Zambia and its Cerro Casale project in Chile.

Some $930 million of the impairment charge related to Lumwana, where Barrick plans to suspend operations following legislation that raises the royalty rate to a level the company says makes the mine uneconomic.

Another $778 million was related to Cerro Casale.

Barrick posted stronger-than-estimated adjusted earnings of $174 million, or $0.15 per share. Analysts predicted $0.136 per share, according to Capital IQ data.

Revenue fell to $2.51 billion from $2.94 billion year-over-year as the company sold fewer ounces of gold -- 1.57 million compared with 1.83 million -- at an average realized price of $1,204 per ounce compared with $1,272 in the 2013 quarter.

Gold futures averaged $1,202 an ounce in the quarter on the Comex in New York, 5.6 percent less than a year earlier.

Moving forward, Barrick said it expects to produce 6.2 million to 6.6 million ounces of gold in 2015 at all-in sustaining costs of between $860 and $895 per ounce. In 2014, Barrick produced 6.25 million ounces of gold at all-in sustaining costs of $864 per ounce.

Barrick's in-the-ground gold reserves fell to 93 million ounces at end-2014 from 104.1 million a year ago.

Describing its strategy as going "back to the future," Barrick said it was returning to its roots of being lean, nimble and entrepreneurial to an environment where operational heads had greater autonomy and responsibility.

Barrick said it will sell its Porgera mine in Papua New Guinea and its Cowal mine in Australia to help reduce net debt by at least $3 billion by year-end.

It also said it was reducing the size of its Toronto head office by close to half from 260 positions in 2014 to 140 in 2015, so lowering its administration costs. Net debt stood at $10.4 billion at the end of 2014, Bloomberg reported, citing a report on its website.

The announcement included details on how 35 high-level employees will be compensated.

In the past 10 months, several key positions at Barrick, including the chief executive and the miner's corporate development team, have been eliminated.

Barrick also said it will defer, cancel or sell projects that do not return at least 15 percent on invested capital.

Barrick Gold also declared a quarterly dividend of $0.05 per share, payable on March 16 to stockholders of record on February 27. The ex-dividend date is February 25.

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Thu, 19 Feb 2015 09:03:00 -0500 https://www.proactiveinvestors.com/companies/news/105563/barrick-reports-28-bln-writedown-though-adjusted-profit-beats-to-sell-two-mines-59958.html
<![CDATA[News - Barrick Gold to suspend Zambian copper mine after royalty hike ]]> https://www.proactiveinvestors.com/companies/news/104759/barrick-gold-to-suspend-zambian-copper-mine-after-royalty-hike-58895.html Barrick Gold (TSE:ABX) (NYSE:ABX), the world’s biggest producer of the metal, said it will take steps to stop production at its Zambian operation after the southern African country increased mining royalties.

The new tax plan, expected to go into effect on Jan. 1, eliminates corporate income tax, but imposes a 20 percent gross royalty on revenue without considering profitability, the Toronto-based company said in a statement today. The previous rate was 6 percent.

“The introduction of this royalty has left us with no choice but to initiate the process of suspending operations at Lumwana. Despite the progress we have made to reduce costs and improve efficiency at the mine, the economics of an operation such as Lumwana cannot support a 20 percent gross royalty," Kelvin Dushnisky, the company's co-president said in the statement.

The company’s U.S.-listed shares were up 3.1 percent at $11.08 at 9:34 a.m. in New York.

Barrick said major workforce cuts are planned, beginning in March, following the legally required notice period. The transition to care and maintenance will be completed in the second quarter of 2015.

Parliament in Zambia, Africa’s second-biggest copper producer, approved Finance Minister Alexander Chikwanda’s 2015 budget proposals, which will replace corporate income tax on mines with increased royalties.

In the absence of a modification to the new royalty plan, Barrick said it expects to record an impairment charge related to Lumwana in the fourth quarter of 2014. Lumwana's current net carrying value is about $1 billion.

Barrick said in October it would consider suspending Lumwana if the Zambian government didn’t change the proposed new tax system because it would threaten the operation’s viability.

The gold miner acquired Lumwana when it bought Equinox Minerals in 2011. The mine has disappointed, prompting a $3 billion writedown after costs were higher than expected.

The mine supports nearly 4,000 direct jobs in the area and produced some 138 million pounds of copper in the first nine months of 2014, Barrick said.

Like other miners, the company has been under pressure in recent years to cut costs and focus on more-profitable projects amid lower commodity prices and after building up large debts buying assets during the boom years.

China is the world’s largest consumer of copper, and signs that its growth is slowing have weighed on copper prices all year.

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Thu, 18 Dec 2014 09:42:00 -0500 https://www.proactiveinvestors.com/companies/news/104759/barrick-gold-to-suspend-zambian-copper-mine-after-royalty-hike-58895.html
<![CDATA[News - Barrick hit by lower metal prices, but Q3 adjusted profit tops views ]]> https://www.proactiveinvestors.com/companies/news/103920/barrick-hit-by-lower-metal-prices-but-q3-adjusted-profit-tops-views-57775.html Barrick Gold (NYSE:ABX)(TSE:ABX) reported a drop in third quarter profit on Thursday as the gold miner continued to suffer from lower metals prices and sales volumes, though adjusted earnings beat analysts' estimates.

The world's largest gold miner said it may also need to halt production at its Lumwana copper mine in Zambia if the government goes ahead with a plan to increase royalties.

The Toronto-based company reported net earnings of $125 million, or 11 cents per diluted share, compared to $172 million, or 17 cents per share, in the same period of 2013. On an adjusted basis, excluding unrealized losses tied to foreign exchange and other items, earnings were 19 cents per share, topping the Thomson Reuters mean estimate of 17 cents.

Revenues fell to $2.6 billion from $2.99 billion in the year-ago period.

Gold production was 1.65 million ounces in the latest quarter, down from 1.85 million in the third quarter of 2013, as its Cortez mine in Nevada was hit by lower grades. The average realized gold price came to $1,285 an ounce, lower than the $1,323 an ounce last year.

Barrick said all-in sustaining costs, an industry-wide metric, improved, however, to $834 per ounce from $914 per gold ounce a year earlier.

It also produced 131 million pounds of copper, down from 139 million. The average realized copper price fell to $3.09 per pound from $3.40 per pound.

The company said its solid production and lower than expected costs drove its second reduction to its annual all-in sustaining cost guidance for 2014. It now expects all-in costs of $880 to $920 an ounce, compared to its prior outlook of $900 to $940 an ounce. 

Its gold production forecast for the full year was narrowed to between 6.1 to 6.4 million ounces, from 6.0 to 6.5 million ounces previously. It lifted its copper output guidance, however, to between 440 and 460 million pounds, from 410 to 440 pounds previously, mainly because of an earlier-than-expected restart of operations at Lumwana in July.

"We are focused on the best assets in the best regions, where we see the most potential to create value for shareholders, areas where we have already established distinctive geological and technical knowledge and strong partnerships," said co-president of Barrick, Kevin Dushnisky, who took over in July together with co-president Jim Gowans.

"We will only invest in mines and development opportunities that can generate strong returns and free cash flow through commodity cycles."

As a result, Barrick said that opportunities at or near existing operations will be a first priority, minimizing risk and maximizing returns, with the company focusing its exploration and growth efforts in Nevada. Approximately 50% of its 2014 exploration budget is allocated to Nevada, with a large majority to go towards its Goldrush project.

At its Lumwana copper mine in Africa, the gold miner is dealing with a proposed change to Zambia's mining tax regime, which would replace the current corporate income tax and variable profit tax with a 20 percent royalty, which if approved, would take effect in January 2015. The company said this considerable hike from the 6 percent royalty it is currently paying would "challenge the economic viability of the mine."

Its Pascua-Lama project is still on care and maintenance, with a decision to re-start development depending on improved economics and more certainty on legal and permitting matters. The company says it is in the final stages of preliminary engineering for the permanent water management system and is discussing the permitting requirements necessary to obtain approval for construction with Chilean regulators.

Shares of Barrick fell 2.8 percent to C$13.94 in Toronto as of 10:41am ET on Thursday, stretching year-to-date losses to nearly 26 percent.

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Thu, 30 Oct 2014 11:00:00 -0400 https://www.proactiveinvestors.com/companies/news/103920/barrick-hit-by-lower-metal-prices-but-q3-adjusted-profit-tops-views-57775.html
<![CDATA[News - Barrick Gold to face $3 bln class action lawsuit ]]> https://www.proactiveinvestors.com/companies/news/103124/barrick-gold-to-face-3-bln-class-action-lawsuit--56628.html Barrick Gold (TSE:ABX) has been slapped with a multi-billion dollar class action lawsuit launched by Koskie Minsky LLP, Sutts, Strosberg LLP, Siskinds LLP and Groia & Company Professional Corporation.

The law firms said in a statement on Sept. 6 that that they served a fresh as amended statement of claim in a $3 billion class action against Barrick Gold and others on Sept. 5. 

The claim alleges wrongdoing against Barrick Gold and its senior officers Aaron Regent, Jamie Sokalsky, Ammar Al-Joundi and Peter Kinver.

The detailed claim alleges there were misrepresentations in Barrick's public disclosure relating to the company's development of the Pascua-Lama mine located on the border between Chile and Argentina.

The firms said that Barrick failed to disclose that certain key development activities at the Pascua-Lama mine were not in compliance with environmental conditions imposed by the Chilean government on Barrick's approval to develop the Pascua-Lama project. The purpose of these conditions was to ensure that the development and, later, the mining of the Pascua-Lama project would have the least possible adverse impact on the community and the environment.

"The action raises serious questions about how Barrick Gold conducted its business and affairs and the manner in which it raised capital from public markets," Kirk Baert of Koskie Minsky LLP was quoted in the statement.

Koskie Minsky LLP, based in Toronto, is a class action, labour, employment and litigation firm. Sutts, Strosberg LLP has been involved in many class action decisions in Canada and has recovered more than $1.5 billion for its clients, according to the statement.

Siskinds LLP is lead counsel or co-lead counsel in eleven of the twelve class actions filed under Ontario's new investor protection legislation, Part XXIII.1 of the Ontario Securities Act. Part XXIII.1 came into effect on December 31, 2005.

Shares of Barrick Gold closed up 0.7 percent at C$18.64 on Sept. 5.

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Mon, 08 Sep 2014 09:33:00 -0400 https://www.proactiveinvestors.com/companies/news/103124/barrick-gold-to-face-3-bln-class-action-lawsuit--56628.html
<![CDATA[News - Barrick shares drop on weaker Q2 results as new management ushered in ]]> https://www.proactiveinvestors.com/companies/news/102591/barrick-shares-drop-on-weaker-q2-results-as-new-management-ushered-in-55836.html Barrick Gold's (TSE:ABX) (NYSE:ABX) shares were falling on Thursday after the world's largest gold producer was still showing a loss in its second quarter on lower gold and copper prices as well as reduced sales volumes and weaker-than-expected production.

For the three months to June 30, Barrick, which reports in US currency, posted a net loss of $269 million, or 23 cents per share, compared to a net loss of $8.56 billion, or $8.04 per share, in the corresponding period of 2013, when markets sustained a sharp drop to gold prices and Barrick was hit by a massive write down on its shelved Pascua Lama project.

The company said the latest period includes, among other items, a $514 million writedown of the Jabal Sayid copper project in Saudi Arabia, for which it recently signed a deal to form a 50-50 joint venture with Saudi Arabian Mining Co (Ma'aden) to operate the property. Under the deal, Ma'aden has agreed to pay $210 million for its stake in the venture.

On an adjusted basis, the gold miner reported a net profit of 14 cents per share, down from 66 cents per share in the year-ago period, attributed to lower gold and copper prices as well as lower year-over-year sales volumes. 

It sold 1.5 million gold ounces in the second quarter, at an average realized price of $1,289 an ounce, compared with 1.8 million ounces a year earlier, at an average price of $1,411 per ounce. It produced 1.49 million gold ounces, and 67 million pounds of copper. 

The company improved its cost profile for gold, however, lowering its all-in sustaining costs to $865 an ounce, down from $910 an ounce in the second quarter of 2013.

"Second quarter all-in sustaining costs of $865 per ounce in a lower production quarter clearly demonstrate our ongoing and relentless focus on company-wide cost management," said outgoing president and CEO, Jamie Sokalsky, who is leaving his post in September as part of a new executive management structure Barrick believes will allow it to meet the demands and challenges of the mining industry in the 21st century.

"The commitment by our mine managers to cost reduction and capital efficiency has allowed us to lower our mid-year operating and capital cost guidance for the second year in a row."

Indeed, the company reduced its 2014 guidance for its all-in sustaining costs per ounce to $900 to $940, from $920 to $980 previously, while its adjusted operating cost guidance was also lowered to between $580 and $630 an ounce, down from between $590 and $640. 

Sokalsky, who has presided over the company in one of the toughest times of its history amid a declining gold price, was appointed to the chief executive role after two decades with the company in various positions, following the sudden exit of Aaron Regent in 2012 for failing to boost Barrick's stock price. 

Since 2012, Barrick has reduced the number of mines in its portfolio from 27 to 19 and divested non-core assets for proceeds in excess of $1.3 billion, the majority of which has been used to reduce its debt load. The company said the ongoing process to further improve its portfolio and reduce costs will focus on the "delta between current and optimal performance", and will determine the quickest way to close this gap.

As part of the new management structure, Kelvin Dushnisky, currently senior executive vice president responsible for corporate and government affairs and chairman of African Barrick Gold plc, and Jim Gowans, who is executive VP and chief operating officer, have been named co-presidents. The two men will be responsible for the company's strategic priorities and operating plans going forward, Barrick said, with Sokalsky's leave effective September 15.

The company also lowered late Wednesday its capital expenditure forecast range by $200 million to $2.2 to $2.5 billion, and maintained its full year gold production outlook of 6.0 to 6.5 million ounces.

Barrick is putting a renewed focus on exploration in Nevada, home to some of its largest operations, including its massive Goldstrike and Cortez mines, and an area seen to hold upside production potential for the company.

Shares of the gold miner fell 2.3 percent to C$19.67 in Toronto on Thursday. Its stock is up 5.4 percent so far this year.

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Thu, 31 Jul 2014 13:24:00 -0400 https://www.proactiveinvestors.com/companies/news/102591/barrick-shares-drop-on-weaker-q2-results-as-new-management-ushered-in-55836.html
<![CDATA[News - Barrick Gold's CEO Sokalsky to step down amid new management structure ]]> https://www.proactiveinvestors.com/companies/news/102325/barrick-golds-ceo-sokalsky-to-step-down-amid-new-management-structure--55479.html Barrick Gold (TSE:ABX) (NYSE:ABX) says CEO Jamie Sokalsky will step down from his role after just two years on the job, as part of a new executive management structure that the world's largest gold producer believes will allow it to "meet the distinct demands and challenges of the mining industry in the 21st century."

Sokalsky, who has presided over the company in one of the toughest times of its history amid a declining gold price, was appointed to the chief executive role after two decades with the company in various roles, following the sudden exit of Aaron Regent in 2012 for failing to boost Barrick's stock price. 

Kelvin Dushnisky, currently senior executive vice president responsible for corporate and government affairs and chairman of African Barrick Gold plc, and Jim Gowans, who is executive VP and chief operating officer, have been named co-presidents. 

As co-presidents, the two men will be responsible for the company's strategic priorities and operating plans going forward, Barrick said, with the new management model reflecting "the interconnected nature" of jointly managing day-to-day mining operations and Barrick's relationships with host governments, local communities and external stakeholders.

"These structural changes put an even greater emphasis on operational excellence, and will accelerate our portfolio optimization and cost reduction initiatives, while fostering a partnership culture both inside the company and externally," said chairman John Thornton.

"The changes we are announcing today build on the operating model that Jamie and his team implemented over the past year, setting the stage for us to move forward as a nimble, more versatile company focused on shareholder returns."

Other changes announced Wednesday include Ammar Al-Joundi's promotion to senior executive vice president and chief financial officer, while Darian Rich will become executive VP of talent management, a new position for Barrick. 

Sokalsky's leave will become effective September 15, but he will help in facilitating a smooth transition in the interim. 

Sokalsky said in the statement that he is particularly proud of what the company has been able to accomplish over the past two years, and that it is now time for Barrick's next phase of development, with the new management structure designed to help the gold miner address the key challenges facing the mining industry. 

Indeed, Barrick has not been alone in facing in what can only be described as a tough year for the mining industry as a whole, amid sharply declining metal prices, softening gold demand and rising costs. 

Faced with weaker gold prices, the gold giant has undergone an enormous transition over the last 12 months, selling non-core mines in an effort to reduce debt and focusing on maximizing cash flow at its existing operations. In April of this year, merger talks with U.S.-based Newmont Mining Corp. (NYSE:NEM) were terminated, bringing to an end months-long negotiations to create a global mining giant.

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Wed, 16 Jul 2014 11:18:00 -0400 https://www.proactiveinvestors.com/companies/news/102325/barrick-golds-ceo-sokalsky-to-step-down-amid-new-management-structure--55479.html
<![CDATA[News - Barrick partners with Saudi state-owned company for Jabal Sayid mine ]]> https://www.proactiveinvestors.com/companies/news/102282/barrick-partners-with-saudi-state-owned-company-for-jabal-sayid-mine-55408.html Barrick Gold (NYSE:ABX)(TSE:ABX), the world's largest producer of the yellow metal, is partnering with a Saudi Arabian mining company to operate the Jabal Sayid copper mine, which is located 120 km southeast of Medina. 

Ma'aden, the state-owned Saudi company, will own 50 percent of the new joint venture, for a cash cost of $210 million. Barrick will hold the remaining interest. 

The deal is expected to wrap up in the fourth quarter, subject to closing conditions, according to Barrick's statement released Sunday. 

"This joint venture will enable the Jabal Sayid project to move forward with the benefit of Ma'aden's extensive experience in the Saudi Arabian mining sector, combined with Barrick's technical and operating expertise," said Barrick's chief executive, Jamie Sokalsky, in the release.

"Once in production, Jabal Sayid will be a high-quality, low-cost underground copper mine capable of generating substantial free cash flow, while providing benefits for local communities through training, employment and economic development."

The mine is expected to begin production in late 2015, and is anticipated to produce between 100 to 130 million pounds of copper in concentratre per year during its first full five years of operation.

Jabal Sayid is estimated to have a mine life of up to 15 years based on its 1.4 billion pounds of proven and probable reserves as at year-end 2013.

Barrick said that more exploration work will be carried out within the mining license area and the exploration license area surrounding the mine, with the goal of extending the mine life.

The joint venture is the first partnership Barrick has announced since John Thornton became the company's executive chairman earlier this year.

Faced with weaker gold prices, the gold giant has undergone an enormous transition over the last 12 months, selling non-core mines and focusing on maximizing cash flow at its existing operations. In April of this year, merger talks with U.S.-based Newmont Mining Corp. (NYSE:NEM) were terminated, bringing to an end months-long negotiations to create a global mining giant.

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Mon, 14 Jul 2014 13:41:00 -0400 https://www.proactiveinvestors.com/companies/news/102282/barrick-partners-with-saudi-state-owned-company-for-jabal-sayid-mine-55408.html
<![CDATA[News - Barrick Gold Q1 profit beats Wall Street ]]> https://www.proactiveinvestors.com/companies/news/101074/barrick-gold-q1-profit-beats-wall-street-53763.html Barrick Gold Corp. (TSE:ABX) (NYSE:ABX), the world’s largest producer of the metal by both production and market value, reported first-quarter earnings that exceeded analysts' expectations.

Net income declined 90 percent to $88 million, or 8 cents per share, in the three months ended March 31, from $847 million, or 85 cents per share, a year earlier, the Toronto, Ontario-based company said in a statement today. 

A decline in metal prices and lower gold volumes impacted earnings during the quarter.

Adjusted operating cost to produce an ounce of gold in the first quarter was $582 per ounce, compared with $564 a year earlier and the $614 average of three estimates. 

Production slid to 1.59 million ounces of gold from 1.8 million ounces a year earlier, but was slightly above the 1.58 million average of four estimates.

Average realized gold prices retreated to $1,285 an ounce, from $1,629 an ounce a year earlier. Gold prices slumped 28 percent in 2013, the largest annual decline since 1981.

Earnings excluding currency losses and other unusual items were 20 cents per share, squeaking the 19-cent average of 19 estimates tracked by Bloomberg. 

Sales dropped 23 percent to $2.63 billion from $3.4 billion, below the $2.75 billion average estimate.

Barrick's U.S.-listed shares inched up 0.7 percent to $17.80 at 8:13 a.m. in New York. 

Faced with weaker gold prices, Barrick has undergone an enormous transition over the last 12 months, selling non-core mines and focusing on maximizing cash flow at its existing operations. Gold prices are more than 30 percent below their 2011 highs.

“Barrick is a considerably different company today than it was a year ago — leaner, stronger and more financially flexible,” Chief Executive Officer Jamie Sokalsky said in the statement.

"We continue to focus on assets that can generate the most attractive risk-adjusted returns and free cash flow for Barrick and its shareholders, and we are decisively addressing our under-performing operations."

Looking ahead, the company lowered its copper production forecast for the year amid issues at the Lumwana mine in Zambia. Barrick cut forecast to between 410 and 440 million pounds, from between 470 and 500 million pounds.

Barrick's earnings results come just two days after merger talks with U.S.-based Newmont Mining Corp. (NYSE:NEM) were terminated, bringing to an end monthslong negotiations to create a global mining giant.

 

 

 

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Wed, 30 Apr 2014 08:53:00 -0400 https://www.proactiveinvestors.com/companies/news/101074/barrick-gold-q1-profit-beats-wall-street-53763.html
<![CDATA[News - Barrick Gold says Newmont Mining terminates merger talks ]]> https://www.proactiveinvestors.com/companies/news/101021/barrick-gold-says-newmont-mining-terminates-merger-talks-53688.html Barrick Gold Corp. (TSE:ABX) (NYSE:ABX), the world’s largest producer of the metal by volume, said that its smaller rival Newmont Mining Corp. (NYSE:NEM) ended merger talks.

Shares of Toronto, Ontario–based Barrick were up 0.6 percent at $18.00 at 8:23 a.m. in New York, while Newmont tumbled 5.6 percent to $24.98.

Barrick said it was informed by Greenwood Village, Colorado-based Newmont of the termination of the discussions, according to a brief statement from Barrick today.

“Although Barrick believes the interests of shareholders are best served through the completion of this business combination, Newmont’s board has determined that the interests of Newmont’s shareholders are best served by remaining independent,” Barrick said in the statement.

Talks between Newmont and Barrick broke down on April 18 over a disagreement about a proposed spinoff of some of the combined company’s assets, Bloomberg reported, citing people familiar with the situation.

Under the terms of their latest proposal, Barrick would have paid $13 billion in stock to buy Newmont.

The companies have discussed merging at least two other times over the last two decades.

Barrick and Newmont already are equal partners in the Kalgoorlie mine in Australia, and jointly own the Turquoise Ridge mine in Nevada, with Barrick controlling 75 percent.

 

 

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Mon, 28 Apr 2014 08:38:00 -0400 https://www.proactiveinvestors.com/companies/news/101021/barrick-gold-says-newmont-mining-terminates-merger-talks-53688.html
<![CDATA[News - Barrick Gold faces $6 bln class action suit over Pascua Lama property ]]> https://www.proactiveinvestors.com/companies/news/101010/barrick-gold-faces-6-bln-class-action-suit-over-pascua-lama-property-53668.html Barrick Gold Corp. (TSE:ABX), the world’s largest producer of the metal by volume, was slapped with a multi-billion dollar class action suit launched by Koskie Minsky LLP and Sutts, Strosberg LLP against the company and certain of its officers.

The claim was made on behalf of purchasers of Barrick securities from May 7, 2009 and November 1, 2013, the law firms said in a statement today.

Allegations state that the Toronto, Ontario-based company's public disclosure misrepresented the progress and feasibility of its Pascua-Lama project located in Chile and Argentina, according to the statement.

On April 10, 2013, a Chilean appeals court ordered Barrick to halt construction at the Pascua-Lama project citing environmental infractions. Subsequently, Barrick announced that it expected to take an after-tax impairment charge of $4.5 to $5.5 billion and that it was indefinitely suspending the Pascua-Lama project. Investors are alleged to have lost billions of dollars as a result of these misrepresentations and failures to disclose.

"The plaintiff, on behalf of Barrick's investors, seeks an explanation and compensation for the significant losses he and other investors suffered as the challenges regarding the Pascua-Lama project have been revealed," Kirk Baert of Koskie Minsky was quoted in the statement as saying.

Barrick Gold was up 0.9 percent at C$19.42 at 1:36 p.m. in Toronto today. The stock is up 4.1 percent so far this year.

 

 

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Fri, 25 Apr 2014 13:57:00 -0400 https://www.proactiveinvestors.com/companies/news/101010/barrick-gold-faces-6-bln-class-action-suit-over-pascua-lama-property-53668.html
<![CDATA[News - Barrick slumps as Newmont merger talks reportedly break down ]]> https://www.proactiveinvestors.com/companies/news/100911/barrick-slumps-as-newmont-merger-talks-reportedly-break-down-53539.html Barrick Gold Corp. (TSE:ABX), the world’s largest producer of the metal by volume, fell to the lowest this year after media reports indicated talks for a possible merger with Newmont Mining Corp. (NYSE:NEM), the largest U.S. gold producer, broke down in the past week.

Toronto, Ontario-based Barrick stumbled 3.7 percent to C$19.08 at 1:46 p.m. in Toronto after touching $18.92, the lowest intraday price since Dec. 31.  Newmont, on the other hand, jumped 5.4 to $24.81 in New York.

The two companies, with a combined market capitalization of about $33 billion, were in advanced talks about a merger last week, the Wall Street Journal reported on April 18.

The companies had agreed to an all-stock merger and planned to announce the deal next week, Bloomberg reported yesterday, citing people familiar with the talks.

Barrick was to offer Newmont shareholders a premium of 13 percent over Newmont’s average trading price over the last 20 days, one of the people told Bloomberg.

The merger plan hit a snag only when Barrick and Newmont failed to come to a complete agreement on which mines to include in the spinoff, Bloomberg said, citing the people. Unable to finalize a deal before a self-imposed April 21 deadline, the companies instead agreed to call off the plan for now, they said.

Both companies wanted to have a deal announced before their annual meetings, the people said. Newmont’s meeting is scheduled for April 23 and Barrick’s for April 30. 

Barrick had twice reached deals to buy Newmont, first in 2008 and then in 2010, but scrapped the agreements, Reuters reported.

Barrick operates mines in Argentina, Chile, Canada, Australia, the Dominican Republic, Papua New Guinea, Peru, the U.S. and Zambia. It also owns 64 percent of African Barrick Gold Plc., a producer in Tanzania that was spun out of Barrick in 2010, and has a stalled mine in Saudi Arabia. Newmont, which is based in Greenwood Village, Colorado, operates in the U.S., Australia, Peru, Indonesia, Ghana, New Zealand and Mexico.

Barrick and Newmont already jointly own the Turquoise Ridge mine in Nevada, with Barrick controlling 75 percent. They are also 50-50 partners in the Kalgoorlie mine in Australia.

The companies both produce more than a third of their gold in Nevada, from which they originally built out their businesses.

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Mon, 21 Apr 2014 14:21:00 -0400 https://www.proactiveinvestors.com/companies/news/100911/barrick-slumps-as-newmont-merger-talks-reportedly-break-down-53539.html
<![CDATA[News - Barrick falls as company plans to sell 13.5% stake in African arm ]]> https://www.proactiveinvestors.com/companies/news/100265/barrick-falls-as-company-plans-to-sell-135-stake-in-african-arm-52659.html Barrick Gold Corp. (TSE:ABX), the world’s biggest producer of the metal, dropped to the lowest in a month after saying it plans to divest a 13.5 percent stake in its African arm to continue to cut its portfolio of assets in the wake of the precious metal’s price slump.

The shares declined 1 percent to C$21.87 after touching C$21.75, the lowest intraday price since Feb. 13. The stock is up 17 percent this year.

Barrick will sell about 41 million shares of London-based African Barrick Gold Plc (LON:ABG) to institutional investors, the Toronto, Ontario-based company said in a statement today. 

The stock being sold was valued at about 126 million pounds (C$233 million) at the close of trading in London today. 

UBS AG, JPMorgan Chase & Co. and Royal Bank of Canada were hired to manage the sale.

Barrick currently owns 74 percent of African Barrick. It held talks with China National Gold Group Corp. in 2012 about the sale of its majority stake. The discussions ended in January last year without agreement.

Barrick has sought ways to lift profitability and returns after gold posted last year its biggest annual slump in three decades. The company has trimmed production forecasts, cut spending and sold about $1 billion of assets in the past eight months. Barrick has also suspended construction of its delayed and over budget Pascua-Lama project on the Argentina-Chile border.

In January, African Barrick, which operates three gold mines in Tanzania, reported its first annual rise in production since the company was spun out from its parent in 2010. 

African Barrick is not considered one of Barrick Gold’s core assets.

 

 

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Mon, 10 Mar 2014 15:17:00 -0400 https://www.proactiveinvestors.com/companies/news/100265/barrick-falls-as-company-plans-to-sell-135-stake-in-african-arm-52659.html
<![CDATA[News - Barrick Gold reports $2.83 bln Q4 loss; slashes reserves to focus on returns ]]> https://www.proactiveinvestors.com/companies/news/99873/barrick-gold-reports-283-bln-q4-loss-slashes-reserves-to-focus-on-returns-52043.html Barrick Gold (TSE:ABX) shares were higher on Thursday, even as the world's largest producer of the yellow metal posted a fourth quarter net loss of $2.83 billion, as it also cut its reserve estimates and said it anticipated lower production this year. 

The gold miner said the most recent quarter included some $2.82 billion in impairment charges, mainly tied to its Pascua-Lama, Porgera, Veladero and the Australia Pacific gold operations, as well as $176 million in suspension-related costs at the plagued Pascua-Lama project. 

On a per share basis, net loss amounted to $2.61 per share. 

Adjusted net earnings, excluding one-time costs, were $410 million, or 37 cents per share, compared to $1.16 billion, or $1.16 per share, in the same period a year earlier. 

Revenue fell to $2.93 billion from $4.15 billion.

The company, which has lately been focused on divesting assets as it strives to conserve cash in the face of a volatile gold market, also said Thursday that it expects to produce between 6.0 and 6.5 million ounces of gold in 2014, down considerably from nearly 7.2 million ounces produced in 2013. 

It also lowered its gold reserves estimate to 104.1 million ounces at the end of 2013, from 140.2 million ounces at the end of 2012, as it used a new gold price assumption of $1,100 per ounce of gold compared to the $1,500 an ounce price used in the prior estimate. 

"The disciplined capital allocation framework that we adopted in mid-2012 has been at the core of every decision we've made in the last year and half, and has put us in a much stronger position to deal with the challenging gold price environment our industry is facing today," said president and CEO Jamie Sokalsky. 

"Under a comprehensive plan to strengthen the company, we have become a leaner, more agile organization, better protected against further downside price risk and well positioned to take advantage of attractive investment opportunities going forward."

In the last six months, the company has announced a series of divestments, and suspended construction at its Pascua-Lama project temporarily in the fourth quarter. Through these efforts, it reduced 2013 capital and operating costs by about $2 billion, and improved near-term cash flow. 

Last month, Barrick and Goldcorp (TSE:G) announced a deal to sell the Marigold mine in Nevada to Silver Standard Resources Inc. (TSE:SSO) for a total of US$275 million cash, with Barrick to receive US$86 million for its stake in the mine. 

It also announced an agreement to sell Barrick Energy and six other non-core mines for total proceeds of $1.0 billion. This includes the sale in late January of its two mine operations in Western Australia to Northern Star Resources for AU$75 million in cash. This deal is expected to close in March.

The divestments come after a terrible year for the miner, with 2013 marking a period of write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably co-chair John Thornton's multi-million dollar signing bonus amid a cratering gold market. 

Earlier in December, the gold giant announced a series of high level personnel changes, starting with news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors at Barrick's next annual meeting of shareholders. Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.

"2013 was a tough year for Barrick by any measure, but with a renewed focus on capital discipline and operational excellence across the board, we have reset our focus and revitalized the company's prospects," Sokalsky said. 

Shares of Barrick rose nearly 3% in Toronto on Thursday, to C$21.43. So far this year, the stock has climbed over 14%. 

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Thu, 13 Feb 2014 11:25:00 -0500 https://www.proactiveinvestors.com/companies/news/99873/barrick-gold-reports-283-bln-q4-loss-slashes-reserves-to-focus-on-returns-52043.html
<![CDATA[News - Barrick Gold, Goldcorp sell Marigold mine to Silver Standard Resources ]]> https://www.proactiveinvestors.com/companies/news/99718/barrick-gold-goldcorp-sell-marigold-mine-to-silver-standard-resources-51802.html Barrick Gold (NYSE:ABX)(TSE:ABX) says it is selling its one-third stake in the Marigold mine in Nevada to Silver Standard Resources (TSE:SSO) for a total of $86 million, with the deal expected to close this April. 

The world's largest producer of gold has a 33.3% stake in Marigold, with the remainder held by Goldcorp (TSE:G) (NYSE:GG), the world's second biggest producer of the yellow metal. Goldcorp also agreed to sell its majority interest in the Nevada mine as part of a joint deal, for a total of $275 million in cash between the two parties.

Barrick's share of production last year at the mine was about 55,000 ounces of gold, according to its statement, at all-in sustaining costs of roughly $1,545 per ounce. 

The divestiture, in coordination with Goldcorp, is part of Barrick's ongoing process to optimize its portfolio to maximize free cash flow. 

Excluding today's sale, over the past six months, the company has announced a series of divestitures of short life, high cost and non-core assets, for a total consideration of about $850 million. In late January, Barrick said it was selling its interest in two mine operations in Western Australia for AU$75 million in cash. 

The sale of the Kanowna Belle and Kundana operations to Northern Star Resources Ltd. is expected to close in March.

The divestments come after a terrible year for the miner, with 2013 marking a period of write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably co-chair John Thornton's multi-million dollar signing bonus amid a cratering gold market. 

Earlier in December, the gold giant announced a series of high level personnel changes, starting with news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors at Barrick's next annual meeting of shareholders. Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.

Shares of Barrick declined over 1% on Tuesday, to $21.19 in Toronto.

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Tue, 04 Feb 2014 11:37:00 -0500 https://www.proactiveinvestors.com/companies/news/99718/barrick-gold-goldcorp-sell-marigold-mine-to-silver-standard-resources-51802.html
<![CDATA[News - Barrick Gold rises on sale of more assets in western Australia ]]> https://www.proactiveinvestors.com/companies/news/99550/barrick-gold-rises-on-sale-of-more-assets-in-western-australia-51504.html Barrick Gold (NYSE:ABX)(TSE:ABX) shares were rising in Toronto on Thursday after the company said it has agreed to sell its interest in the Kanowna Belle and Kundana mine operations in western Australia to Northern Star Resources for a total of A$75 million. 

The deal is expected to close in March of this year. 

Shares of Barrick were up 3.9% in afternoon trade Thursday, after the announcement of the divestment last night, at $21.62. So far this year, the stock has advanced more than 15% after taking a serious tumble last year amid a declining gold price. 

Over the past six months, the company has announced a series of divestitures of short life, high cost and non-core assets, for a total consideration of about $850 million. 

As of December 31, 2012, Kanowna contained proven and probable reserves of 0.6 million ounces, and the mine produced about 225,000 ounces in 2013. 

The deal follows a similar transaction last month, in which Barrick agreed to sell to Northern Star its Plutonic gold mine in western Australia for a total of A$25 million.

The divestments come after a terrible year for the miner, with 2013 marking a period of write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably co-chair John Thornton's multi-million dollar signing bonus amid a cratering gold market. 

Earlier in December, the gold giant announced a series of high level personnel changes, starting with news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors at Barrick's next annual meeting of shareholders. Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.

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Thu, 23 Jan 2014 13:20:00 -0500 https://www.proactiveinvestors.com/companies/news/99550/barrick-gold-rises-on-sale-of-more-assets-in-western-australia-51504.html
<![CDATA[News - Barrick Gold sells Plutonic mine in Australia for A$25 mln ]]> https://www.proactiveinvestors.com/companies/news/99179/barrick-gold-sells-plutonic-mine-in-australia-for-a25-mln-50929.html Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) shares fell in Toronto on Monday after the company said last night it has agreed to sell its Plutonic gold mine in western Australia to Northern Star Resources for a total of A$25 million. 

The deal, which is subject to closing conditions, is expected to close in February.

Shares of Barrick were down over 2% on the TSX on Monday morning, at $17.44. 

As of year-end 2012, Plutonic contained proven and probable reserves of 0.2 million ounces, measured and indicated resources of 0.8 million ounces and inferred resources of 1.0 million ounces. The mine produced 86,000 gold ounces in the first nine months of this year, at all-in sustaining costs of $1,110 per ounce, Barrick said. 

The divestment comes amid a terrible year for the miner, with 2013 marking a period of write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably co-chair John Thornton's multi-million dollar signing bonus amid a cratering gold market. 

Earlier this month, the gold giant announced a series of high level personnel changes, starting with news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors next year at the gold giant’s annual meeting of shareholders. Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.

That meeting is also to see two other directors -- Howard Beck and ex-PM Brian Mulroney, both Barrick veterans – step down from the board in favour of new faces. The board has put forward four names for election as independent directors at the 2014 AGM -- Ned Goodman of Dundee Corp., Nancy Lockhart of Frum Development Group, former University of Toronto president David Naylor and Ernie Thrasher, CEO of Xcoal Energy & Resources – in a move that will change the mix to 10 independent directors and four non-independent directors.

The company also appointed James Gowans, ex- of DeBeers Canada, to the role of executive vice president and chief operating officer in late January of the New Year.

Shareholder disquiet was certainly at the root of all the reforms, which also installed a new pay-for-performance executive compensation plan  scheduled to take effect as of next year's AGM. 

Barrick has seen its shares price tumble almost 50% so far this year as gold is set to post its first annual loss since 2000. Falling commodities prices have hit the world's leading gold producer hard, as they have done to miners across the industry. Costs that have spiraled out of control over the decade-long bullion boom proved unsustainable in a lower-price environment.

Last month, the company said it was suspending construction at its Pascua-Lama mine that straddles the Chile-Argentina border as a means to conserve cash and reduce capital costs for next year by up to another $1.0 billion. 

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Mon, 23 Dec 2013 11:07:00 -0500 https://www.proactiveinvestors.com/companies/news/99179/barrick-gold-sells-plutonic-mine-in-australia-for-a25-mln-50929.html
<![CDATA[News - Personnel changes aplenty at beleaguered Barrick as focus shifts to China ]]> https://www.proactiveinvestors.com/companies/news/98882/personnel-changes-aplenty-at-beleaguered-barrick-as-focus-shifts-to-china-50489.html Barrick Gold Corp (TSE:ABX) (NYSE:ABX) has announced a series of high level personnel changes, starting with the news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors next year at the gold giant’s annual meeting of shareholders. 

According to a company statement released after the bell, John Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.

That meeting is to see two other directors -- Howard Beck and ex-PM Brian Mulroney, both Barrick veterans – step down from the board in favour of new faces.

The board has put forward four names for election as independent directors at the 2014 AGM -- Ned Goodman of Dundee Corp., Nancy Lockhart of Frum Development Group, former University of Toronto president David Naylor and Ernie Thrasher, CEO of Xcoal Energy & Resources – in a move that will change the mix to 10 independent directors and four non-independent directors.

One personnel change noted in the same announcement, set to take effect sooner rather than later, is the appointment of James Gowans, ex- of DeBeers Canada, who takes on the role of executive vice president and chief operating officer in late January of the New Year.

Perhaps more telling is the new pay-for-performance executive compensation plan included as part of the reforms, scheduled to take effect as of next year's AGM. It is a move designed to “further [link] compensation with the long-term interests of shareholders,” according to the company statement released. "[Barrick] has consulted extensively with shareholders in the development of this plan and continues to do so.”

Indeed, shareholder disquiet is certainly at the root of the changes, as the gold giant lurches to the end of an annus horribilis that has seen write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably Thornton’s multi-million dollar signing bonus, amid a cratering gold market.

Falling commodities prices hit the world's leading gold producer hard, as they have done to miners across the industry. Costs that have spiraled out of control over the decade-long bullion boom proved unsustainable in a lower-price environment.

The string of misfortunes has seen a precipitous drop in the value of Barrick shares over the past 12 months. Last month, the company said it was suspending construction at its Pascua-Lama mine that straddles the Chile-Argentina border as a means to conserve cash and reduce capital costs for next year by up to another $1.0 billion. 

Thornton’s plans for the company, discussed in an afternoon press conference in Toronto, seem to indicate a desire to move towards a partnership with China, with the chairman-to-be saying that he would like the miner to build a long-term relationship with the Asian giant.

“What we are interested in is a distinctive, enduring relationship with the Chinese that, if it were the right kind of relationship, should exist in perpetuity,'' he said.

Either way, with speculation on the "when" of Munk's retirement now concluded, it’s the end of an era, and one that the man who took the company from a one-mine junior to a leading producer told a news conference in Toronto was “sweet and sour”, even as he noted his faith in those now leading Barrick.

“To me, what matters is what really is right for Barrick.”

Shares in Barrick ended the day at $16.71 on the TSX on Wednesday afternoon, up 21 cents for the day but well down on the 52 week high of $35.50 hit in January.

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Thu, 05 Dec 2013 08:29:00 -0500 https://www.proactiveinvestors.com/companies/news/98882/personnel-changes-aplenty-at-beleaguered-barrick-as-focus-shifts-to-china-50489.html
<![CDATA[News - Barrick Gold gains as it readies for board shakeup: WSJ ]]> https://www.proactiveinvestors.com/companies/news/98879/barrick-gold-gains-as-it-readies-for-board-shakeup-wsj-50477.html Barrick Gold Corp. (TSE:ABX) shares advanced Wednesday as the gold giant is expected to announce the appointment of Ned Goodman to its board today, and to hire Jim Gowans as its chief operating officer as part of a major shakeup, according to a report in the Wall Street Journal. 

Dundee Corp's Goodman, a Canadian resource investor, is expected to replace former Canadian Prime Minister Brian Mulroney on the board. 

The news follows reports from earlier this week that Barrick will today confirm that chairman Peter Munk will step down at the company's next annual shareholders meeting, and will be succeeded by co-chairman John Thornton.

The gold producer, which has lost roughly 52% of its share price year-to-date, has been mired by shareholder complaints and various charges this year, as miners struggle to remain profitable amid a declining gold price and a higher cost environment. Since its 2013 annual meeting earlier this year, the company said its directors have been in discussions with its institutional investors and is in the midst of addressing issues that had been raised, including with Barrick's executive compensation scheme and a "rejuvenation of the board through a combination of departures, the addition of independent directors and succession in the Chairman role at the company."

Last month, the company said it was suspending construction at its Pascua-Lama mine that straddles the Chile-Argentina border as a means to conserve cash and reduce capital costs for next year by up to another $1.0 billion. The company is also targeting $500 million of additional annual savings related to job reductions from a company-wide review launched earlier this  year -- now largely complete -- and through a new operating model and a program to reduce procurement costs. 

The troubled project on the border between Chile and Argentina was initially expected to be producing gold and silver this year, but it suffered legal setbacks as it has long been the subject of concerns relating to its proximity to glaciers and to the effects of inadequate water safety on downstream communities.

Shares of Barrick were trading up 1.3% within minutes of the closing bell in Toronto, at $16.73. 

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Wed, 04 Dec 2013 16:02:00 -0500 https://www.proactiveinvestors.com/companies/news/98879/barrick-gold-gains-as-it-readies-for-board-shakeup-wsj-50477.html
<![CDATA[News - Barrick indicates founder-chairman Munk to step down ]]> https://www.proactiveinvestors.com/companies/news/98383/barrick-indicates-founder-chairman-munk-to-step-down-49714.html Barrick Gold Corp. (TSE:ABX), the world’s largest producer of the metal by volume, indicated today that its 86-year-old founder and chairman, Peter Munk, is likely to step down from his post before the company's annual meeting next year.

The board is addressing issues including changes to executive-compensation arrangements, and the “rejuvenation” of the board through departures and the addition of independent directors, The Toronto-based company said in a filing today.

"The board is addressing the issues that have been raised with our directors, which include modification of the company's executive compensation arrangements, the rejuvenation of the board through a combination of departures from the board, the addition of independent directors and succession in the chairman role at the company, consistent with Munk's desire to retire as chairman of the board," the filing said.

The comments were made in the company’s formal $3-billion U.S. stock sale filing, which was unveiled last week after Barrick announced plans to suspend construction at its costly Pascua Lama mine in South America.

Barrick said it intends to update the market before year end on these initiatives, with governance changes expected to take effect in conjunction with Barrick’s next annual meeting. This year's meeting was held in April.

Munk started the company in 1983 and forged it into the world's largest gold producer. But recent missteps have raised questions about the leadership of a man once viewed as a mining-industry visionary.

Barrick faced a minor investor uprising at this year's annual meeting, with some 85 percent of its shareholders rejecting its nonbinding resolution on executive compensation.

The uprising started after a group of Canada's top pension funds said they opposed Barrick's $11.9 million signing bonus for Co-Chairman John Thornton, the man tipped as the miner's next chairman.

Adding to the discontent, Barrick has been plagued by problems, such as the ballooning capital costs at its key growth project, Pascua-Lama, a mine it has been trying to build high in the Andes Mountains on the border of Chile and Argentina.

Barrick said last month that it would stop development of Pascua-Lama indefinitely, a surprise reversal on a project that has already cost it more than $5 billion.

Barrick shares sank 1 percent to C$18.80 at 1:34 p.m. in Toronto, extending this year's losses to 46 percent.

 

 

 

 

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Fri, 08 Nov 2013 14:00:00 -0500 https://www.proactiveinvestors.com/companies/news/98383/barrick-indicates-founder-chairman-munk-to-step-down-49714.html
<![CDATA[News - Barrick Gold shares tumble after $3 bln bought deal to cut debt announced ]]> https://www.proactiveinvestors.com/companies/news/98243/-barrick-gold-shares-tumble-after-3-bln-bought-deal-to-cut-debt-announced-49484.html Barrick Gold Corp (NYSE:ABX) (TSE:ABX) shares dropped 6% in early deals Friday, after last night announcing a $3 billion bought deal offering to cut debt, extending losses from the regular trading session on Thursday when the gold miner said it would suspend construction at its Pascua-Lama mine in South America to further slash costs. 

Under an agreement with a syndicate of underwriters led by RBC Capital Markets, Barclays and GMP Securities, the company, the world’s largest producer of gold by volume, will offer up 163.5 million shares priced at $18.35 apiece. 

The company said the underwriters also have an over-allotment option, allowing them to purchase up to an additional 24.5 million shares for total proceeds of $3.45 billion.

The net proceeds from the offering will be approximately $2.9 billion, Barrick said in a statement released late Thursday. 

The gold producer is planning to use $1.1 billion of the net proceeds to redeem the outstanding $700 million worth of 1.75% notes due in 2014, and a further $350 million in 4.875% notes, also due next year. 

The company is also planning a cash tender offer for various outstanding debt securities of Barrick and its subsidiaries, using about $1.5 billion of its net proceeds to purchase notes in the proposed tender offer.

The balance of the new funds will be used to further strengthen Barrick's balance sheet, the company said, which could include further debt reductions and ongoing operating and capital expenditures at its portfolio of mines.

Barrick's shares dropped another 6% Friday in Toronto to $19.10 after shedding the same on Thursday following the company saying it is suspending construction at its Pascua-Lama mine that straddles the Chile-Argentina border as a means to conserve cash and reduce capital costs for next year by up to another $1.0 billion. The Pascua-Lama news overshadowed Barrick's solid quarterly results, which still revealed cash costs among the lowest in the industry at $916 per ounce in the third quarter. 

The company is also targeting $500 million of additional annual savings related to job reductions from a company-wide review launched earlier this  year -- now largely complete -- and through a new operating model and a program to reduce procurement costs. 

The troubled project on the border between Chile and Argentina was initially expected to be producing gold and silver this year, but it suffered legal setbacks as it has long been the subject of concerns relating to its proximity to glaciers and to the effects of inadequate water safety on downstream communities. In August, the gold miner took a $5.1-billion writedown on the project as part of an $8.7-billion impairment charge.

The gold producer, which has lost roughly 45% of its share price year-to-date, has been mired by shareholder complaints and various charges this year, as miners struggle to remain profitable amid a declining gold price and a higher cost environment. Since its 2013 annual meeting earlier this year, the company said its directors have been in discussions with its institutional investors and is in the midst of addressing issues that had been raised, including with Barrick's executive compensation scheme and a "rejuvenation of the board". 

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Fri, 01 Nov 2013 10:03:00 -0400 https://www.proactiveinvestors.com/companies/news/98243/-barrick-gold-shares-tumble-after-3-bln-bought-deal-to-cut-debt-announced-49484.html
<![CDATA[News - Barrick suspends Pascua Lama to cut back on more costs amid solid quarterly report ]]> https://www.proactiveinvestors.com/companies/news/98213/barrick-suspends-pascua-lama-to-cut-back-on-more-costs-amid-solid-quarterly-report-49442.html Barrick Gold (NYSE:ABX)(TSE:ABX) is suspending construction at its Pascua-Lama mine that straddles the Chile-Argentina border as a means to conserve cash and reduce capital costs for next year by up to another $1.0 billion, as the price of its chief commodity is set to snap 12 years of gains in 2013. 

The Pascua-Lama news overshadowed Barrick's solid quarterly results, which still reveal cash costs among the lowest in the industry. "Significant cost and operational improvements achieved this year, including previously announced reductions of $2.0 billion from budgeted 2013 capital and costs, have translated into another quarter of strong results," said Barrick's president and CEO, Jamie Sokalsky, in a statement Thursday announcing its third quarter financials. 

"We continue to make excellent progress at Lumwana and are evaluating a number of other opportunities to improve performance further."

The company, the world’s largest producer of gold by volume, is also targeting $500 million of additional annual savings related to job reductions from a company-wide review launched earlier this  year -- now largely complete -- and through a new operating model and a program to reduce procurement costs. 

"The suspension of Pascua-Lama will also significantly improve our near term cash flows," the chief executive said, saying the decision to temporarily suspend construction, apart from those activities required for environmental protection and regulatory compliance, will postpone and reduce near-term cash outlays. The decision to restart will depend on improved project economics, Barrick added, such as go-forward costs, metal price outlook and reduced uncertainty tied to legal and other regulatory concerns.

The troubled project on the border between Chile and Argentina was initially expected to be producing gold and silver this year, but it suffered legal setbacks as it has long been the subject of concerns relating to its proximity to glaciers and to the effects of inadequate water safety on downstream communities. In August, the gold miner took a $5.1-billion writedown on the project as part of an $8.7-billion impairment charge.

For the third quarter that ended September 30, net earnings were $0.17 billion, or 17 cents per share, compared to $0.65 billion, or 65 cents per share, a year ago. 

Adjusted for one-time items such as $280 million in income tax expense at its Pueblo Viejo project and $40 million in unrealized foreign exchange losses, profit came to $0.58 billion, or 58 cents per share, down from $0.88 billion, or 88 cents per share, in the same period last year. 

The company said profit was impacted by lower realized gold and copper prices as well as higher interest and income tax expenses, which were partially offset by higher copper sales. 

Revenue fell to $2.99 billion from $3.40 billion, while adjusted operating cash flow -- a key metric in the mining industry that indicates a company's ability to fund future operations -- fell to $1.3 billion from $1.4 billion in the same period of 2012. 

Barrick produced 1.85 million ounces of gold, at all-in sustaining costs of $916 per ounce in the third quarter, better than the 1.78 million ounces at all-in costs of $1,010 per ounce a year earlier. It produced 139 million pounds of copper, up from 112 million pounds, while copper costs were $2.15 per pound, lower than the $3.05 per pound in the third quarter of 2012. Copper sales surged to 135 million pounds, from 84 million pounds a year ago.

Commodity prices were a drag, however, as the average realized gold price dropped from $1,655 an ounce to $1,323 an ounce, while the average realized copper price declined to $3.40 a pound from $3.52. 

At the end of the quarter, Barrick had cash and equivalents of $2.3 billion, and $1.3 billion of cumulative debt maturing through to the end of 2015. 

Sokalsky said that as a result of the company's previous decision to slow down and re-sequence construction at Pascua-Lama, "which resulted in significant demobilization over the last few months", it is in a much better position to implement the temporary suspension quickly and efficiently. 

Barrick said Thursday that full year gold output is now expected at the low end of its initial 7.0 to 7.4 million ounce range, due to the sale of its Yilgarn South mines, with all-in costs still anticipated within $900 to $975 an ounce. However, due to a turnaround at its Lumwana copper mine in Zambia that was bought as part of its Equinox purchase in 2011 and left Barrick with excess debt, the company increased its full year copper production forecast to a range of 520 to 550 million pounds, while cash cost estimates were lowered to $2.40 to $2.60 a pound.

The gold producer, which has lost roughly 40% of its share price year-to-date, has been mired by shareholder complaints and various charges this year, as miners struggle to remain profitable amid a declining gold price and a higher cost environment. Since its 2013 annual meeting earlier this year, the company said its directors have been in discussions with its institutional investors and is in the midst of addressing issues that had been raised, including with Barrick's executive compensation scheme and a "rejuvenation of the board". 

The company also told investors it continues to actively pursue "other portfolio optimization opportunities, including the divestiture of non-core assets."

Shares declined more than 3.1% in early deals Thursday, to $20.88 in Toronto.

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Thu, 31 Oct 2013 09:46:00 -0400 https://www.proactiveinvestors.com/companies/news/98213/barrick-suspends-pascua-lama-to-cut-back-on-more-costs-amid-solid-quarterly-report-49442.html
<![CDATA[News - Barrick to proceed with Pascua-Lama as Chilean court upholds permit ]]> https://www.proactiveinvestors.com/companies/news/97612/barrick-to-proceed-with-pascua-lama-as-chilean-court-upholds-permit-48464.html Barrick Gold Corp. (TSE:ABX), the world’s largest producer of the metal by volume, said it intends to move ahead with its Pascua-Lama mine in Chile after the South American nation's highest court rejected an indigenous community request to place addition measures against the stalled mine.

The ruling requires Barrick to complete a water-management system that must first meet the approval of the country’s environment ministry, the Toronto-Ontario-based company said in a statement today.

The ruling, which upholds a lower court ruling in July, concludes a constitutional rights protection action filed last year on behalf of four indigenous communities.

Barrick said it is committed to operating "at the highest environmental standards at all of its operations around the world, including at Pascua-Lama," and that it is "pleased that the ruling allows the project to advance in compliance with all legal and regulatory requirements."

The troubled project on the border between Chile and Argentina was initially expected to be producing gold and silver this year, but the company now targets output by mid-2016.

Several big mining and power projects have faced legal setbacks in recent months in Chile, the world's largest copper producer. 

Earlier this year, Barrick took a $5.1-billion writedown on the project as part of an $8.7-billion impairment charge in its most recent quarter.

Barrick shares fell 1.6 percent to C$18.96 at 2:20 p.m., extending this year's losses to approximately 45 percent.

 

 

 

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Thu, 26 Sep 2013 15:06:00 -0400 https://www.proactiveinvestors.com/companies/news/97612/barrick-to-proceed-with-pascua-lama-as-chilean-court-upholds-permit-48464.html
<![CDATA[News - Investors agitate for boardroom changes at Barrick ]]> https://www.proactiveinvestors.com/companies/news/97409/investors-agitate-for-boardroom-changes-at-barrick-48122.html Industry giant Barrick Gold (TSE:ABX) (NYSE:ABX) is feeling pressure for change at board level from investors looking to shake the gold miner up and seeking to hasten the exit of founder Peter Munk, according to accounts in the Wall Street Journal.

Large investors have demanded the world’s largest gold miner allow in “new independent directors soon” and also that Munk proffer a definite timeline for handing over to co-chair, John Thornton, according to the business stalwart citing sources described as “people familiar with the matter.” In particular, a group of roughly 10 European-based shareholders are set to send the board of directors a letter shortly, “demanding changes.”

The Journal went on to identify director Robert Franklin as one who was determined to rescind his place on the board unless some new directors were appointed.

It wouldn’t be the first time investors have spoken out over the gold giant’s management even this year. 

The annual general meeting in April provided the occasion for a shareholder rebellion that culminated in a rejection of a $17 million remuneration package, that – apparently most galling to the seven pension funds raising objections – involved a $12 million signing fee. The repudiation of high-price tag paydays was resoundingly taken up in that 85 per cent of shareholders voted against the package, albeit the action could only ever be symbolic, as the shareholder vote was non-binding.

In many ways, Barrick is a bellwether of the industry, experiencing the pains common to all such precious metals miners in the new low price environment.

The price of gold has fallen precipitously this year and since the peak price of above $1,900 in late 2011 by almost 30 per cent. Concurrent with this fall – and with the heady days of the gold rush that preceded it – costs involved in producing the yellow metal have risen markedly, with equipment, labour costs and sometimes royalties spiking as all sides demanded a share in the boom.

In common with its chief commodity, this has been a bad year for the Toronto-based mining giant as one setback after another has taken its toll. This year alone, the company’s stock has fallen by nearly half.

In many ways Barrick is the author of its own suffering – again, in common with other ailing gold giants – in that it took the step of commissioning high cost projects predicated on gold prices staying above $1,500 an ounce, or even above $1,700 at the peak of the bull market. The decision to press ahead with such high-cost, high-stakes projects is often laid at Munk’s door.

Unsurprising then that calls to hasten the exit of 85 year-old Peter Munk – who started the company with a single gold mine in 1983 -- are coming from every corner.

Shares in Barrick were up the morning after the Wall Street Journal report, adding 23 cents in Toronto to hit $18.98 as of 9.41 am EST.

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Tue, 17 Sep 2013 09:59:00 -0400 https://www.proactiveinvestors.com/companies/news/97409/investors-agitate-for-boardroom-changes-at-barrick-48122.html
<![CDATA[News - Barrick Gold to sell three Australian mines for $300 mln; shares gain ]]> https://www.proactiveinvestors.com/companies/news/96978/barrick-gold-to-sell-three-australian-mines-for-300-mln-shares-gain--47323.html Barrick Gold Corp. (NYSE:ABX), the world’s biggest producer of the precious metal by volume, rose in premarket trading after agreeing to sell three of its Australian mines to South Africa-based miner Gold Fields Ltd. (NYSE:GFI) for $300 million.

The shares advanced 2 percent to $19.44 at 8:35 a.m. in New York.

Proceeds of the deal, expected to close on Oct. 1, will be used for general corporate purposes, including debt repayment, and will be recorded in the fourth quarter, Toronto, Ontario-based Barrick said in a statement today.

The three mines, located in Western Australia and known as the Yilgarn South assets, produced a total of 452,000 ounces of gold in 2012 and a further 196,000 ounces in the first half of this year, Barrick said.

"The agreement to divest Yilgarn South demonstrates further progress as we work to optimize the company's portfolio and maximize free cash flow in line with our disciplined approach to capital allocation," Chief Executive Officer Jamie Sokalsky, who took over in June last year, said in the statement.

Barrick is working to slash operating costs by lowering capital spending and staffing levels as gold miners face some of the industry's most unstable times in more than a decade when gold prices have declined 28 percent from their 2011 peak.

Barrick's adjusted earnings slid to 66 cents a share in the second quarter ended June 30, from 82 cents a share in the year-earlier period.

The stock has plunged 45 percent since the beginning of the year.

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Thu, 22 Aug 2013 09:03:00 -0400 https://www.proactiveinvestors.com/companies/news/96978/barrick-gold-to-sell-three-australian-mines-for-300-mln-shares-gain--47323.html
<![CDATA[News - Barrick "can’t depend on higher prices to manage our business”: CEO to shareholders ]]> https://www.proactiveinvestors.com/companies/news/96644/barrick-cant-depend-on-higher-prices-to-manage-our-business-ceo-to-shareholders-46730.html “We can’t depend on higher prices to manage our business”, said Barrick Gold Corporation (TSE:ABX) (NYSE:ABX) president and CEO Jamie Sokalsky on a conference call with investors, analysts and media held the morning of the release of the gold giant’s figures for the second quarter that saw a whopping $8.6 billion loss on the back of plummeting metal prices, and that message – along with talk of cost-cutting and efficiencies across the company's operations -- dominated the call.

Sokalsky reiterated that he remained bullish on the long-term prospects for the company’s metals, saying that the future of Barrick was to concentrate on “quality not quantity.”

The CEO, appointed to his post just over a year ago, promised that the mining major would adopt the stance that “returns will drive production, product won’t drive returns,” and to that end, the miner was reviewing all its projects in search of efficiencies.

He said the company was “taking action” in the face of the disastrous quarterly results precipitated by a vertiginous drop in metal prices for its main commodity, including measures such as upping cut-off grades in some instances, and shortening the life of certain mines in others.

Sokalsky spoke of a program of evaluation that had been underway across the giant’s portfolio “for months” that included the re-figuring of internal calculations predicated at a market price of $1,100 per ounce for the company’s main commodity -- $600 lower than the figure used in earlier years -- saying this work had allowed for a “quick and decisive” response to the precipitous price drops experienced by precious metals in the past few months.

The chief emphasized that these efforts were not one-offs, but were set to continue even if prices were to go back up, saying the measures would “put us in a better position should prices decline further.”

“We’re managing our business to maximize cash flow in a lower price environment.”

Sokalsky said the giant was prepared to make "the tough decisions” and raised the possibility of “suspending, closing and divesting” underperforming assets, emphasizing that even money-making mines could benefit from optimization.

“Just because a mine is profitable doesn’t mean it can’t be optimized; were looking at every mine and have been for months now.”  He advised that the giant intends to re-examine mines that return a figure of more than $1,000 per ounce for the metric of all-in-sustaining costs per ounce, with the intention of either optimizing operations, changing mine plans or taking the step of suspending, closing or divesting the project altogether.

“Our goal is to reduce the number of mines in our portfolio that [book costs] above $1,000 per ounce.”

Sokalsky reiterated the company’s “disappointment” in the write downs, but said “we are confident our assets will generate more value over time than the current values applied.”

On the question of Pascua-Lama and the wisdom of proceeding with the trouble-plagued and extremely expensive project, Sokalsky allowed that while it was true the massive high-altitude project would not be green lit were it to come up for approval in the current price environment, the project was “halfway through development and the decision to suspend is different from the decision to start construction.” He also re-iterated the long-term value of the project, recent write downs notwithstanding.

“Pascua Lama will be a world-class mine; a significant cash generator and a core mine for Barrick; there aren’t many mines of this quality in the world. At 25 years, its mine life far surpasses the average life of metal mines. I’m confident this will be a high value mine for Barrick.”

Sokalsky also said that the quarter just ended proved the companies fundamentals were “strong”, emphasizing the reductions in capex and the impact of other cost cutting measures.

Costs of production for the metal in the quarter just ended were reported as coming in at $552 for adjusted operating costs per ounce, below the guidance figure of $575 to $615, or $919 per ounce on an all-in sustaining basis, within the current guidance of $900 to $975 per ounce. The Canadian giant is responding to the rout in gold prices and various additional troubles with a program of cost cutting and a reduced dividend of a nickel per quarter, down from 20 cents.

Shares in Barrick were trading up on the Toronto Stock Exchange Thursday, as the company's quarterly results exceeded analysts' estimates despite its breathtaking loss, with 52 cents being added to previous close to hit $17.53 at 11:57 am EST, also on the back of an uptick in gold prices.

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Thu, 01 Aug 2013 12:03:00 -0400 https://www.proactiveinvestors.com/companies/news/96644/barrick-cant-depend-on-higher-prices-to-manage-our-business-ceo-to-shareholders-46730.html
<![CDATA[News - Struggling giants - Barrick, Kinross, Yamana - post a sea of red as gold price bites ]]> https://www.proactiveinvestors.com/companies/news/96633/struggling-giants-barrick-kinross-yamana-post-a-sea-of-red-as-gold-price-bites-46710.html The most recent charge has effectively wiped out any hope of profit for the second quarter, which would have come to $663 million for earnings per share of 66 cents, compared to $821 million or 82 cents in the year ago period, instead recording a loss of $8.6 billion, corresponding to a breathtaking loss of $8.55 per share.
Shareholders had been bracing themselves, even following the revelation in June that troubled Pascua-Lama project was set to be the author of impairment to the tune of $5 billion, and indeed the write downs are attributable mainly to Pascua-Lama, which booked a $5.1 billion charge. As well, $1.3 billion in impairments were booked to smaller assets, while the company also took a hit from a $0.5 billion loss on the sale earlier in the summer of Barrick Energy, which was disclosed at the time, and $2.3 billion in goodwill impairments.
Chief among the causes of the write downs is the internal readjustments contingent on the price of gold. The troubled giant altered the gold prices on which much of its figuring was predicated to $1,300 an ounce for gold, close to the price at which the yellow metal currently trades since dropping almost 20 per cent from its 2013 high hit in January.
The miner also reported operating cash flow of $896 million and adjusted operating cash flow of $804 million. The major reported production of 1,811 ounces for the quarter, up on the year earlier total of 1,742.
Costs of production for the metal were reported as coming in at $552 for adjusted operating costs per ounce, below the guidance figure of $575 to $615, or $919 per ounce on an all-in sustaining basis, within the current guidance of $900 to $975 per ounce.
The Canadian giant is responding to the rout in gold prices and various additional troubles with a program of cost cutting and a reduced dividend of a nickel per quarter, down from 20 cents.
President and CEO Jamie Sokalsky addressed the campaign to reduce costs in his comments released with the figures, saying of the cost cutting efforts: “Over the past year, we have taken and are continuing to take a series of steps to reduce costs as part of our disciplined capital allocation framework, which allowed us to respond quickly to the new metal price environment.
"We have reduced 2013 budgeted capital and costs by about $2.0 billion which has offset the cash flow impact of the drop in gold and copper prices that has occurred this year. We have reduced all-in sustaining cost guidance by about $100 per ounce this year from levels which are the lowest of our peers. The bulk of our expected 2013 gold production is at all-in sustaining costs well below current spot levels, and for those operations that are not generating positive cash flow, we will change mine plans, suspend, close or divest them.”
Changes to internal figuring dependent on the price of gold took a bite out of Kinross Gold Corp. (TSE:K) (NYSE:KGC) too, with the gold giant announcing in its quarterly results released Wednesday after the bell, a loss of $2.5 billion or $2.17 per share on the back of a $2.4 billion impairment charge. With the charge stripped out, adjusted net earnings came to $119.5 million, or 10 cents per share, compared with $156.8 million, or 14 cents per share, in the second quarter of 2012.
The most recent installment of write downs comes in a year that has already seen a series of impairment charges for the company, bringing the total written off for the year to $8 billion. The company took the step of cancelling the next due dividend and posited the option of doing so for the foreseeable future.
Also of note, for a company bent on cost savings, was the announcement that it would delay the decision on whether to pull the trigger on a new mill at one of its projects.
The miner reported adjusted operating cash flow of $256.7 million, or 22 cents per share, compared to $268.0 million, or 24 cents per share, a year ago. Production for the quarter came to 655,381 gold equivalent ounces compared to 632,772 ounces a year ago.
Costs of production for the quarter came in at $737 per ounce, compared to the $724 per ounce recorded a year ago, with all-in sustaining costs of $1,072 per ounce sold compared with $970 per ounce a year ago.
Yamana Gold Inc. (TSE:YRI) (NYSE:AUY), which also reported the same night as Kinross, posted a net loss of $7.9 million for a loss of a penny per basic and diluted share, with adjusted figures of $50.2 million for 7 cents per basic and diluted earnings per share.
The miner reported production of 295,545 gold equivalent ounces at all-in sustaining costs of $950 per gold equivalent ounce. Cash flows from operations came to $150.9 million.
Unlike the others, Centerra Gold (TSE:CG), which also posted late Wednesday, swung to profit for the quarter on the back of higher production at its flagship mine, which served to offset the dive taken by the yellow metal to post net income of $1.6 million, for earnings of a penny a share, well up from the loss of $48.9 million or 21 cents per share recorded a year ago.
The company reported production for the quarter of 99,426 ounces, compared to just under 52,500 ounces the year before, a surge of almost 90 per cent that did much to offset the plummet in the price of gold.
Centerra's latest results, did, however, include expenses of $2.8 million primarily made up of a charge of $2.2 million for the write-off of certain infrastructure assets at Kumtor, which could not be relocated as a result of the accelerated movement of the Central Valley Waste Dump. 
In light of the dramatic drop in gold prices, the company has also conducted reviews of its operating costs and capital expenditures and implemented measures to reduce spending, saying that it believes it can continue to generate cash at the lower gold prices reached in June. Centerra is forecasting all-in cash costs, including all operating cash costs, capital and taxes, to be between $1,120 and $1,230 per ounce for the year.
In the past two months alone, gold companies have taken $21 billion in charges. 
Shares of Barrick, Kinross and Centerra were all running higher in early deals Thursday, amid an increase in gold prices, while shares of Yamana were down were down more than 3 per cent in Toronto, to $10.40.  ]]>
Thu, 01 Aug 2013 09:35:00 -0400 https://www.proactiveinvestors.com/companies/news/96633/struggling-giants-barrick-kinross-yamana-post-a-sea-of-red-as-gold-price-bites-46710.html
<![CDATA[News - African Barrick takes $700 mln charge as gold’s devaluation bites; $185 mln in cuts promised ]]> https://www.proactiveinvestors.com/companies/news/96618/african-barrick-takes-700-mln-charge-as-golds-devaluation-bites-185-mln-in-cuts-promised-46685.html African Barrick Gold (LON:ABG) has taken a $727 million post-tax charge stemming from a reduction in the value of its mines, according to figures for the first half of the year released Tuesday after the bell North American time, with a reported $185 million in cuts to come chief among the measures the miner is implementing to take account of the newly lowered price of its main commodity.

For the half year to June 30, the London-headquartered gold miner reported adjusted net earnings of $39.3 million or 9.6 cents per share although the impact of one-off adjustments of $741 million resulted in a net loss of $701.2 million, or $1.71 per share.

The loss is attributable primarily to non-cash impairment charges of $727 million, post tax, related to the Buzwagi mine, which accounted for $543 million, the North Mara mine, which lost $128 million, the Tulawaka mine, which booked a writedown of $17 million, and the Nyanzaga mine, which took a charge of $39 million. The figures posted a year ago recorded an adjusted net profit of $74 million for earnings per share of 18 cents.

Operational cash flow was $99.0 million in the latest period. 

Production for the quarter to June 30 came to almost 166,000 ounces of gold, with cash costs of $879 per ounce sold reported, a figure which drops to $862 if the Tulawaka mine was excluded. However, the metric of all-in sustaining costs shows a figure of $1,416 per ounce.

Production for the half year came to almost 312,000 ounces of gold, with gold sales of almost 320,000 ounces recorded, both figures up from a year ago, when gold production of almost 298,000 and gold sales of just over 302,500 ounces were recorded. The miner is maintaining its full year production guidance.

The mid-cap gold producer, 74 per cent of which is owned by Barrick Gold Corporation (TSE:ABX) (NYSE:ABX), could be regarded as a bellwether for Barrick shareholders bracing themselves for tomorrow’s quarterly results.

The company, spun off from parent Barrick, which rejected the offer of offloading it earlier this year, operates three of its mines in Tanzania and saw a fourth mine closed down earlier in the year, a casualty of commodity headwinds that rendered it uneconomic.

In common with other gold miners suffering from diminishing metals prices, the miner said in a company statement released with the figures that it is “taking decisive action in response to changed gold price environment”, has engaged in cost cutting measures, the first step of which identified $185 million in cuts.

Of this, $95 million is to come from a reduction in operating costs, $50 million comes from a reduction in sustaining capital expenditure, while another $25 million comes from shrinking exploration spending and the remaining $15 million is derived from trims to corporate administration expenses.

The company also announced a plan to shorten the mine life of the Buzwagi mine to 6 and a half years, a measure intended to return the mine to cash flow generation. Mining at the site – the company's highest cost mine – will cease in 3 and a half years under the new plan, with the remaining 3 years planned to be spent processing the stockpiles on hand.

“We have delivered strong operational performance in the first half, with production tracking ahead of guidance and cash costs below the bottom of the guidance range,” said chief executive officer, Greg Hawkins. 

“We have taken decisive action at all of our mines, including the reshaping of the life of mine at Buzwagi, in order to adapt to the lower gold price environment. We have a solid base from which to implement the findings of the Operational Review, which has identified potential cost savings of US$185 million across the group.

"Having taken these steps, we remain confident in the ability of our asset base to deliver shareholder value which is reflected in the decision to continue with our stated dividend policy. We remain on track to achieve our full year guidance.”

Shares in the company finished up in London the day after the release of figures, adding 1.50 pence per share to previous close to settle at 112.90 pence.

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Wed, 31 Jul 2013 12:57:00 -0400 https://www.proactiveinvestors.com/companies/news/96618/african-barrick-takes-700-mln-charge-as-golds-devaluation-bites-185-mln-in-cuts-promised-46685.html
<![CDATA[News - Barrick Gold to take $500 mln hit on sale of Barrick Energy ]]> https://www.proactiveinvestors.com/companies/news/96466/barrick-gold-to-take-500-mln-hit-on-sale-of-barrick-energy-46437.html Beleaguered gold giant Barrick Gold Corp. (TSE:ABX) (NYSE:ABX) announced late Tuesday the impending sale of its subsidiary Barrick Energy in a series of deals worth a total of $455 million.

The deals include the sale of assets to Venturion Oil for $59 million and an agreement, announced last month with Whitecap Resources (TSE:WCP), for another group of assets for $174 million. Calgary major Canadian Natural Resources Ltd.  (TSE:CNQ) has also agreed to pay $173 million for a gross overriding royalty on certain lands valued at about $50 million for Barrick Energy and its remaining assets.

Investors bracing themselves ahead of the gold producer’s release of quarterly figures next week could be in for another nasty shock, as the sale – about $405-million of which is to be cash -- means the world’s once leading gold producer will be recognizing a loss of $500 million in connection with the deal. The loss relates to the price paid for the business itself ($400 million some 5 years ago) as well as to the cost of capital invested since then.  The Toronto-headquartered miner said about $90-million of the $500-million loss would be a goodwill charge.

The sale comes as Barrick reacts to an unbroken string of trouble, much of which has affected other miners, particularly those producing gold, as precious metals prices drop and cost increases erode margins.

The impairment charge of $500 million in connection with the sale of the energy businesses comes on top of the previously announced impairment charge of $4.5 billion to $5.5 billion the mining major will be taking in the second quarter due to plummeting metal prices and the company’s never-ending catalogue of ills at its Pascua-Lama project. 

The Pascua-Lama project, which straddles the border between Chile and Argentina high in the Andes, has been the subject of numerous write downs, work-stoppages and legal wrangles culminating in a most recently court-ordered halt imposed on construction of the massive mine site due to various violations of the environmental permit. Barrick is obliged to build new water management systems before construction on the site will be permitted to resume, putting the date of first production for the mine back as far as mid-2016, two years beyond the date initially forecast.

The mid-July announcement that first production from the mine had been pushed back so far past the schedule previously proclaimed culminated in decade-low share prices for the gold giant. The company has also cautioned that the long-term assumptions on the price of precious metals, which Barrick uses to determine various metrics, may be re-assessed, subject to prices remaining at their new lower levels.

The sale announced late Tuesday ties in with the miner’s promise to sell non-core assets.

“As part of its disciplined capital allocation framework, Barrick is actively pursuing opportunities to optimize its portfolio, including through opportunities to divest certain non-core assets," a company statement released with the announcement read in part.

The sale is expected to boost liquidity, ease debt-pressure and allow the giant to turn its attentions to gold more fully.

Other assets thought to be likely to go on the block include African Barrick Gold PLC, in which the giant holds a 74 per cent share, the Kabanga nickel project in Tanzania, of which Barrick owns 50 per cent, and the Jabil Sayid copper project in Saudi Arabia.

The company said the energy deals are expected to close by July 31, subject to some conditions.

Shares in the company were trading well down on the Toronto Stock Exchange the day after the announcement, losing $1.02 off its prior close to hit $17.08 as of 1:57pm EST, a drop of more than 5 per cent.

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Wed, 24 Jul 2013 14:15:00 -0400 https://www.proactiveinvestors.com/companies/news/96466/barrick-gold-to-take-500-mln-hit-on-sale-of-barrick-energy-46437.html
<![CDATA[News - Appeals court finds against Barrick on Pascua-Lama ]]> https://www.proactiveinvestors.com/companies/news/96263/appeals-court-finds-against-barrick-on-pascua-lama-46113.html The latest installment in Barrick Gold Corp’s (TSE:ABX) (NYSE:ABX) series of woes clustered around the $8.5 billion money pit Pascua-Lama broke late Monday, with the formal suspension of the massive gold project as a Chilean appeals court ruled against the troubled giant in favour of the indigenous peoples who charge the Toronto-headquartered miner with contaminating their water supplies downstream from the mine.

The unanimous ruling from the Copiapo Court of Appeals concerning an action filed on behalf of four indigenous communities in 2012, held that the mining giant must adhere to the conditions of its environmental permit before construction of the border-straddling mine can recommence. To that end, the company must complete the mine’s water management system.

It feels like deja-vu all over again for the beleaguered giant, which was already the subject of a stop-work order and a multi-million dollar fine from the country’s environmental watchdog agency, Superintendence of the Environment (in Spanish, Superintendencia del Medio Ambiente or SMA), in late May. In addition to the fine levelled, the SMA insisted that Barrick satisfy the conditions of its permits by completing Pascua-Lama's water management system in such a way that it would ensure the watershed below the mine remained uncontaminated before proceeding, but the new ruling goes further by demanding the repair of damage already done to rivers.

The rivers in question feed the farms of the local indigenous population in the arid region of the Atacama Desert, reputed to be the driest desert in the world. Work on the site was already halted in April by the appeals court by way of injunction, while it examined the claims against the world’s biggest gold producer.

It is only the newest headache engendered by the high altitude mine, which crosses the border with Argentina on the roof of the Andes. The most recent in a series of legal woes, writedowns and work stoppages prior to Monday’s news – the announcement that first production from the mine had been pushed back to mid-2016, well past the late-2014 schedule previously proclaimed, as a consequence of May’s decision -- culminated in decade-low share prices for the gold giant.

In a company statement released on the heels of Monday’s ruling, Barrick said it was “committed to operating at the highest environmental standards at all of its operations around the world, including at Pascua-Lama, and is working diligently to meet all regulatory requirements at the project.”

“Barrick's vision is to be the world's best gold mining company by operating in a safe, profitable and responsible manner."

Should it ever get built, Pascua-Lama will be one of the world’s cheapest gold mines as well as one of the largest, with 17.9 million ounces of gold and 676 million ounces of silver.

Barrick was trading slightly up on the Toronto Stock Exchange the morning after the announcement, adding 27 cents to a previous close of $15.69 as of 9.52am EST.

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Tue, 16 Jul 2013 09:54:00 -0400 https://www.proactiveinvestors.com/companies/news/96263/appeals-court-finds-against-barrick-on-pascua-lama-46113.html