Follow Barrick Gold to never miss an important update.
Gold.com reported a difficult quarter as both profit and sales came in well below what analysts were looking for. The company brought in about 3.3 billion dollars in revenue, which was roughly 1.5 billion dollars less than expected. Despite the miss, the company still made a small profit of 1.6 million dollars and declared a quarterly dividend of 20 cents per share.
This is a sharp drop from the strong results the company saw earlier in the year. While management pointed to the strength of their business model, the gap between these results and market expectations suggests the company is facing much tougher conditions in the alternative assets and precious metals market than it did just a few months ago.
Source: Company earnings report
The company is scheduled to report its quarterly results today. Analysts are expecting earnings of about 0.88 dollars per share on revenue of roughly 4.81 billion dollars. Beyond the headline numbers, the focus remains on whether the company can keep its mining costs under control. For a large miner like this, the gap between the market price of gold and the cost to pull it out of the ground is what determines how much cash is left over for dividends and buybacks.
The company hired Nick Bowkett as its new Vice President of Trading and Business Development. He will oversee the company's platform for trading precious metals and collectibles. While this adds a new leader to the trading team, it is a routine hire for a divisional role. It does not change the company's overall strategy or its outlook for the year.
Source: GlobeNewsWire
The government's preferred inflation gauge rose in September, moving further away from the Federal Reserve's target. At the same time, economic growth for the third quarter came in higher than analysts expected.
For a gold miner like Barrick, this is a mixed signal. A strong economy and sticky inflation often mean interest rates stay high to cool things down. High rates typically make gold less attractive because it pays no interest, though gold is also often used as a hedge when inflation stays high for a long time.
Source: Fox Business
GoldMining has started a pre-feasibility study for its Sao Jorge site in Brazil, which is a formal deep dive into whether a mine can be built there profitably. Along with the study, the company is using three rigs to drill 6,000 meters of new core samples to better map out the gold in the ground.
This is a step forward in turning a discovery into an active mine. For a mining company, these studies are the milestones that prove a project has real value, though it will still take significant time and more testing before any gold is actually pulled from the earth.
Source: PRNewsWire
Management has missed expectations in six of the last eight quarters. This pattern of wide misses suggests the business is difficult to forecast or that leadership is struggling to set realistic targets.
| Expectation | |
|---|---|
| EPS | $0.80 |
| Revenue | $4.70B |
Follow Barrick Gold to get the latest and most important updates.
Follow GOLD