Barrick Gold Q3 net earnings slip to US$125M; revenue contracts to $2.6B

TORONTO – Barrick Gold Corp. (TSX:ABX) says reduced revenue from lower sales and margins as well as unrealized losses on foreign currency and derivative instruments contributed to lowering its net profits in the third quarter.

Toronto-based Barrick, which reports in U.S. dollars, says net earnings attributable to equity holders in the three months ended Sept. 30 were US$125 million or 11 cents per share. That was down from US$172 million or 17 cents in the comparable prior-year period.

Revenue slipped to US$2.6 billion from just under $3 billion, while operating cash flow fell to $852 million from $1.2 billion, primarily reflecting lower sales volumes and lower gross margins, partially offset by a decrease in income tax payments, the company said in its earnings release issued after markets closed.

Third-quarter adjusted net earnings were US$222 million or 19 cents per share, compared with $577 million or 58 cents in the prior year period.

The decrease was primarily due to lower gold and copper sales volumes and lower realized gold and copper prices, partially offset by lower cost of sales, Barrick said.

“Significant” one-time items included a US$51-million in unrealized losses on non-hedge derivative instruments and US$42 million in unrealized foreign currency translation losses.

Barrick said it has 1.65 million attributable ounces of gold production in the quarter at all-in sustaining costs of US$834 per ounce, compared with 1.85 million ounces at $914 per ounce in the prior-year period.

Copper production totalled 131 million pounds at a C1 cash cost of US$1.82 a pound, compared with 139 million pounds at US$1.69 a pound in the 2013 period.