Barrick Gold’s Q2 2016 Earnings Review: Improved Gold Pricing Environment And Success Of Cost Reduction Initiatives Boost Prospects Going Forward
Barrick Gold reported a significant improvement in its Q2 results with a rally in gold prices and the success of the company’s cost reduction initiatives driving its results. With gold prices expected to remain elevated in the near term, Barrick’s business prospects look fairly bright for the rest of the year. A sharp increase in the investment demand for gold has driven up prices of the yellow metal. A subdued global economic outlook and the outcome of the UK’s EU referendum has increased macroeconomic uncertainty, boosting the safe haven investment demand for gold and ultimately translating into higher gold prices. An increase in macroeconomic uncertainty has also lowered the chances of an interest rate hike by the Fed anytime soon, providing further support for gold prices. Barrick Gold has also successfully lowered its production costs with the impact of the divestment of high-cost mines and the company’s cost rationalization efforts evident in the company’s Q2 results. However, lower gold and copper shipments as a result of asset divestments, and lower copper prices, resulted in a decline in the company’s quarterly revenue.
Have more questions about Barrick Gold? See the links below.
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