In the first year since its merger with Randgold Resources, the
restructured and refocused Barrick Gold Corporation
(NYSE:GOLD)(TSX:ABX) (“Barrick”) has delivered a strong operational
performance and made significant progress towards its goal of
becoming the world’s most valued gold company, it says in its
2019 annual report published today.
President and chief executive Mark Bristow says
in the report that Barrick’s new leadership started 2019 with a
long and challenging to-do list and succeeded in ticking all the
boxes, and more. Highlights included gold production at the top end
of the guidance range; copper production which exceeded its
forecast; the consummation of the Nevada Gold Mines joint venture,
majority-owned and operated by Barrick; the consolidation of the
Tanzanian mines; and the disposal of some non-core assets. Net of
depletion, proven and probable reserves increased year-over-year at
a higher grade. Net earnings per share were $2.26 for 2019,
adjusted net earnings rose by 46%1, net debt was halved to $2.2
billion and the quarterly dividend was increased three times during
the year.
Behind the scenes, the corporate structure was
flattened, general and administrative costs were reduced, executive
management teams were established for each region, and
responsibility for the orebodies was moved back to the operations.
A strong geological and mineral resource management capacity was
introduced throughout the organization to ensure the optimization
of existing assets.
“The work we did in 2019 has equipped us well to
take Barrick to the next level,” says Bristow. “We stand on
the strong foundation of our enormous organic growth potential,
which will support a positive production profile and a very robust
business, capable of generating a substantial cash flow for at
least the next decade. There are also opportunities for growth
outside our current ambit which we continue to explore.”
Included in the report is Barrick’s 10-year
production plan, which showcases a modern gold mining business
capable of sustainably producing around five million ounces of gold
per year and delivering significant free cash flow.2
Bristow notes that during the past year
environmental, social and governance (ESG) management had become a
key investment criterion and is now generally accepted as a
critical measure of the sustainability of a business.
“The principles of ESG have long been embedded
in the DNA of both legacy companies. Our long-term strategy
recognizes that we operate in a changing world where business is
expected to meet the highest standards of behavior, and where
ethical issues have become commercial considerations with serious
consequences. We call this our social license and it is a core part
of all our operations,” he says.
“Barrick is also intent on being at the leading
edge of digitalization and automation in the mining industry, and
trials and projects designed to make our operations more efficient
as well as safer are driving the increased use of technology across
the group.”
Also in the annual report, executive chairman
John Thornton notes that since the year-end, Barrick has been
pro-active in dealing with the Covid-19 pandemic, which he termed
“a global disaster which is changing the way we work and live in a
radically disruptive process with currently no clear end in
sight”.
“Barrick is fully engaged in managing the impact
of Covid-19 on our business and our people, and emergency response
measures have been rolled out at all our sites and operations. Our
new leadership’s experience in managing pandemics and major crises,
combined with Barrick’s financial muscle and its long-established
culture of caring for the welfare of its employees and communities,
have placed us in a strong position to contend with this
challenge,” he says.
Barrick’s 2019 Annual Report, Annual Information
Form and Form 40-F are now available on SEDAR (www.sedar.com) and
EDGAR (www.sec.gov), respectively. Updated National Instrument
43-101 technical reports for each of the Carlin Complex and the
Turquoise Ridge Complex, current as of December 31, 2019, are also
available on SEDAR.
To access the above-mentioned documents, please
visit www.barrick.com. Shareholders may also receive a copy of
Barrick’s audited financial statements without charge upon request
to Barrick’s Investor Relations Department, 161 Bay Street, Suite
3700, Toronto, Ontario, M5J 2S1 or to investor@barrick.com.
Enquiries:
Mark BristowPresident and CEO+1 647 205 7694+ 44 788 071 1386 |
Graham ShuttleworthSenior executive vice-president and CFO+1 647
262 2095+44 1534 735 333+44 779 771 1338 |
Kathy du PlessisInvestor and media relations+44 20 7557 7738Email:
barrick@dpapr.com |
Website: www.barrick.com
Endnote 1
“Adjusted net earnings” and “adjusted net
earnings per share” are non-GAAP financial performance measures.
Adjusted net earnings excludes the following from net earnings:
certain impairment charges (reversals) related to intangibles,
goodwill, property, plant and equipment, and investments; gains
(losses) and other one-time costs relating to acquisitions or
dispositions; foreign currency translation gains (losses);
significant tax adjustments not related to current period earnings;
unrealized gains (losses) on non-hedge derivative instruments; and
the tax effect and noncontrolling interest of these items. The
company uses this measure internally to evaluate our underlying
operating performance for the reporting periods presented and to
assist with the planning and forecasting of future operating
results. Barrick believes that adjusted net earnings is a useful
measure of our performance because these adjusting items do not
reflect the underlying operating performance of our core mining
business and are not necessarily indicative of future operating
results. Adjusted net earnings and adjusted net earnings per share
are intended to provide additional information only and do not have
any standardized meaning under IFRS and may not be comparable to
similar measures of performance presented by other companies. They
should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. For
further details on these non-GAAP measures, please refer to page
63-64 of the MD&A accompanying Barrick’s fourth quarter 2019
audited financial statements filed on SEDAR at www.sedar.com and on
EDGAR at www.sec.gov.
Endnote 2
Barrick is closely monitoring the global
Covid-19 pandemic and Barrick’s guidance may be impacted if the
operation or development of our mines and projects is disrupted due
to efforts to slow the spread of the virus.
Cautionary Statement on Forward-Looking
Information
Certain information contained or incorporated by
reference in this news release, including any information as to our
strategy, projects, plans or future financial or operating
performance, constitutes “forward-looking statements”. All
statements, other than statements of historical fact, are
forward-looking statements. The words “looks”, “believe”,
“expect”, “anticipate”, “target”, “plan”, “objective”, “assume”,
“intend”, “intention”, “project”, “goal”, “continue”, “budget”,
“estimate”, “potential”, “may”, “will”, “can”, “could”, “would” and
similar expressions identify forward-looking statements. In
particular, this news release contains forward-looking statements
including, without limitation, with respect to: the company’s goal
to be the world’s most valued gold mining business; Barrick’s
forward-looking production guidance and estimates of future costs,
including with respect to Barrick’s 5-year plan and 10-year gold
production profile; the impact of the global Covid-19 pandemic on
Barrick’s operations; Barrick’s sustainability performance;
targeted debt and cost reductions; mine life and production rates;
the benefits expected to be realized from the Nevada Gold Mines
joint venture; targeted debt and cost reductions; mine life and
production rates; potential mineralization and metal or mineral
recoveries; and expectations regarding future price assumptions,
financial performance and other outlook or guidance.
Forward-looking statements are necessarily based
upon a number of estimates and assumptions including material
estimates and assumptions related to the factors set forth below
that, while considered reasonable by the company as at the date of
this news release in light of management’s experience and
perception of current conditions and expected developments, are
inherently subject to significant business, economic and
competitive uncertainties and contingencies. Known and unknown
factors could cause actual results to differ materially from those
projected in the forward-looking statements and undue reliance
should not be placed on such statements and information. Such
factors include, but are not limited to: fluctuations in the spot
and forward price of gold, copper or certain other commodities
(such as silver, diesel fuel, natural gas and electricity); the
speculative nature of mineral exploration and development; changes
in mineral production performance, exploitation and exploration
successes; risks associated with projects in the early stages of
evaluation and for which additional engineering and other analysis
is required; disruption of supply routes which may cause delays in
construction and mining activities at the company’s more remote
properties; diminishing quantities or grades of reserves; increased
costs, delays, suspensions and technical challenges associated with
the construction of capital projects; operating or technical
difficulties in connection with mining or development activities,
including geotechnical challenges and disruptions in the
maintenance or provision of required infrastructure and information
technology systems; failure to comply with environmental and health
and safety laws and regulations; timing of receipt of, or failure
to comply with, necessary permits and approvals; uncertainty with
respect to whether some or targeted investments and projects will
meet the company’s capital allocation objectives and internal
hurdle rate; the impact of global liquidity and credit availability
on the timing of cash flows and the values of assets and
liabilities based on projected future cash flows; adverse changes
in our credit ratings; the impact of inflation; fluctuations in the
currency markets; changes in U.S. dollar interest rates; changes in
national and local government legislation, taxation, controls or
regulations and/or changes in the administration of laws, policies
and practices; expropriation or nationalization of property and
political or economic developments in Canada, the United States and
other jurisdictions in which the company or its affiliates do or
may carry on business in the future; lack of certainty with respect
to foreign legal systems, corruption and other factors that are
inconsistent with the rule of law; risks associated with illegal
and artisanal mining; the risks of operating in jurisdictions where
infectious diseases present major health care issues; risks
associated with the Covid-19 pandemic and its impact on operations
or Barrick’s supply chain; damage to the company’s reputation due
to the actual or perceived occurrence of any number of events,
including negative publicity with respect to the company’s handling
of environmental matters or dealings with community groups, whether
true or not; the possibility that future exploration results will
not be consistent with the company’s expectations; risks that
exploration data may be incomplete and considerable additional work
may be required to complete further evaluation, including but not
limited to drilling, engineering and socioeconomic studies and
investment; risk of loss due to acts of war, terrorism, sabotage
and civil disturbances; litigation; contests over title to
properties, particularly title to undeveloped properties, or over
access to water, power and other required infrastructure; business
opportunities that may be presented to, or pursued by, the company;
risks associated with the fact that certain of the initiatives
described in the Annual Report 2019 are still in the early stages
and may not materialize; our ability to successfully integrate
acquisitions or complete divestitures; risks associated with
working with partners in jointly controlled assets; employee
relations including loss of key employees; increased costs and
physical risks, including extreme weather events and resource
shortages, related to climate change; and availability and
increased costs associated with mining inputs and labor. In
addition, there are risks and hazards associated with the business
of mineral exploration, development and mining, including
environmental hazards, industrial accidents, unusual or unexpected
formations, pressures, cave-ins, flooding and gold bullion, copper
cathode or gold or copper concentrate losses (and the risk of
inadequate insurance, or inability to obtain insurance, to cover
these risks).
Many of these uncertainties and contingencies
can affect our actual results and could cause actual results to
differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, us. Readers
are cautioned that forward-looking statements are not guarantees of
future performance. All of the forward-looking statements made in
this news release are qualified by these cautionary statements.
Specific reference is made to the most recent Form 40-F/Annual
Information Form on file with the SEC and Canadian provincial
securities regulatory authorities for a more detailed discussion of
some of the factors underlying forward-looking statements and the
risks that may affect the company’s ability to achieve the
expectations set forth in the forward-looking statements contained
in this news release. We disclaim any intention or obligation to
update or revise any forward-looking statements whether as a result
of new information, future events or otherwise, except as required
by applicable law.
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