Please comment on ABX Q3 earnings announced last week.
Thanks,
George
EPS of 30c missed estimates of 31c; Sales of $3.38B missed estimates of $3.41B. Barrick's 4Q gold production may rise to 1.1 million ounces -- on improving Nevada Gold Mine output, higher grades at Kibali and a steadily improving Pueblo Vieja -- taking full-year output to just above 3.9 million ounces at the bottom end of guidance. Higher output is likely to reduce unit cash costs through fixed cost dilution but inflation could push total cash costs to $30-$40 an ounce above the top end of management's forecast of $1,020 an ounce. Yet at a spot gold price of $2,700 an ounce, 4Q consensus Ebitda of $4.3 billion may be in reach. Strong operating cash flows could see net debt fall to $400 million, even with a further $100 million in share buybacks. However operating challenges at Nevada may continue into 2025, pointing to a modest lift in Barrick's output. Results are not perfect, of course, but we the low valuation of 13.3X earnings reflects this fairly well.