(Bloomberg) -- Barrick Gold Corp. became one of the few major mining companies this earnings season to deliver a positive surprise, navigating cost inflation and production challenges to exceed analysts’ estimates.
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The world’s No. 2 gold producer on Monday reported adjusted earnings of 24 cents a share for the second quarter versus the 23-cent average estimate. Shares rose slightly before the start of regular trading.
Since taking Barrick’s reins after its 2018 takeover of Randgold Resources, Chief Executive Officer Mark Bristow has never missed estimates. On his watch, the Toronto-based firm has coped better than most with inflationary headwinds by unlocking savings following the Randgold acquisition, migrating to a younger workforce and building up stockpiles of inputs such as explosives.
But there’s only so much a CEO can do in the face of lingering supply-chain disruptions spurred by the pandemic, the war in Ukraine and Chinese lockdowns. With labor, energy and supplies getting pricier industrywide, Barrick’s all-in sustaining costs rose 4.1% from the first quarter.
Barrick already reported preliminary gold production for the second quarter that missed estimates, although output continues to grow and the firm says it’s on track to achieve 2022 guidance for both gold and copper.
One saving grace for gold producers: bullion fared better than industrial commodities in a second-quarter selloff due to its haven qualities. Barrick maintained its regular quarterly cash dividend at 20 cents a share.
On an 11 a.m. Eastern Time call Monday, investors will be listening for further guidance on costs and updates on projects such as a Dominican Republic expansion and a giant undeveloped copper-and-gold deposit in Pakistan, as well as prospects in the central African copper belt.
(Adds production detail in fifth paragraph)
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