Barrick Gold’s Q4 2016 Earnings Preview: Higher Gold Prices And Cost Reduction Initiatives To Boost Earnings

February 13th, 2017 by Trefis Team

Barrick Gold will release its Q4 2016 earnings results on February 15 and conduct a conference call with analysts the next day. [1] We expect Barrick Gold to report a significant year-over-year improvement in its earnings driven by higher gold prices and the company’s cost reduction initiatives.

Gold prices were significantly higher in Q4 2016, as compared to the corresponding period of 2015, driven by a sharp rally in prices over the first nine months of 2016. The investment demand for gold drove prices sharply higher in the first nine months of 2016 amid macroeconomic uncertainty as a result of the UK’s EU referendum and concerns over global economic growth. Though prices fell in the fourth quarter in the run up to the Fed’s December interest rate hike, they were still higher on average as compared to Q4 2015.

Besides an improved pricing environment, Barrick’s cost reduction initiatives are expected to further prop up earnings in Q4. A combination of non-core asset sales and operational improvements has helped Barrick lower average operating costs, which should contribute to the improvement in Barrick’s earnings. The following tables summarize our expectations from the company’s Q4 results.

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ABX Q4 2016 Earnings Preview

Have more questions about Barrick Gold? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Barrick Gold

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Notes:

  1. Fourth Quarter 2016 Results Release on February 15, Barrick Gold News Release [↩]