Barrick Gold’s Q2 2018 miss
Barrick Gold (ABX) reported its second-quarter earnings on July 25 after the market closed and held its conference call the next day. The company reported adjusted EPS of $0.07, which missed analysts’ expectations by $0.04.
ABX’s revenues totaled $1.71 billion during the second quarter, which also missed expectations by 6.0%. This trend is in contrast to the company’s first-quarter earnings beat.
Lower sales and higher costs
Barrick Gold’s second-quarter miss was primarily due to lower gold sales and higher maintenance and fuel costs. Its second-quarter gold production totaled 1.07 million ounces, down 24.0% year-over-year (or YoY). Copper production dropped 20.0% YoY to 83.0 million pounds.
Barrick Gold’s all-in sustaining costs (or AISC) rose 20.0% YoY to $856 per ounce in the second quarter. Barrick maintained its full-year production and cost guidance at 4.5 million–5.0 million ounces at its AISC of $765–$815 per ounce.
Stock momentum weak
Barrick Gold stock closed down 6.1% on July 26, resulting from the earnings miss and the lack of any major positive catalysts from the call. ABX stock is trading with a year-to-date decline of 23.0%.
Newmont Mining (NEM) reported its results on July 26 and reported an earnings beat. On July 26, GG and AEM were trading 6.3% and 5.3% lower, respectively, while NEM rose 0.9%.
In this series, we’ll look at Barrick Gold’s recent results as well as what they mean for the company’s future. We’ll also look at its second-quarter earnings call and management’s comments. Then we’ll examine the company’s production and cost performance.