Barrick boosts dividend by 14% with windfall from gold's rally - BNN

Barrick Gold Corp. is returning some of the windfall it’s getting from gold’s record rally to its shareholders.

The world’s second-largest gold miner increased its quarterly cash dividend 14 per cent to 8 cents per share, the company said in its second-quarter earnings statement Monday. That’s up from the previous dividend of 7 cents per share.

“The board believes that the dividend increase is sustainable and reflects the ongoing robust performance of our operations and continued improvement in the strength of our balance sheet,” the company said.

Chief Executive Officer Mark Bristow said the strong cash generation demonstrated the quality of Barrick’s assets and management’s ability to capture the full benefit of higher gold prices.

Key Insights

• All-in sustaining costs increased 8.1 per cent to US$1,031 an ounce in the second quarter from the previous three months amid precautions for the coronavirus.
  • Barrick said last month those costs likely increased seven per cent to nine per cent in the second quarter, compared with the previous three months.
• Spurred by pandemic-induced economic concerns, gold prices have skyrocketed this year, providing a tailwind for producers of the metal.
  • A Bloomberg Intelligence index of senior gold miners has gained over 50 per cent in 2020.
• Spot gold prices were up more than 30 per cent on average in the second quarter compared with a year earlier, and last month they shot past the all-time record set in September 2011.
• Barrick is on track to meet its guidance for 2020 production estimated at a range of 4.6 million to 5 million ounces
  • That target was lowered in May in part because of a conflict with the government of Papua New Guinea over its Porgera mine.

Market Reaction

• Barrick rose 1.7 per cent at 6:20 a.m. in New York before the start of regular trading. The shares climbed 55 per cent this year through Friday’s close.

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• Adjusted earnings came in at 23 cents a share versus the average analyst estimate of 18 cents

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2020-08-10 11:26:26Z
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