You know the news isn’t great when a company’s earnings statement acknowledges the “need for change” and a “new path forward.”
That was some of the language in Barrick Gold Corp.’s fourth-quarter earnings release Thursday. The company — Nevada’s and the world’s largest gold miner — reported a net loss of $3.1 billion, or $3.06 a share, in the three months ending Dec. 31. It posted net earnings of $960 million, or 96 cents a share, in the same quarter of 2011. The quarterly loss came mostly from an after-tax goodwill impairment charge of $3.8 billion related to Barrick’s copper unit.
Barrick reported $4.2 billion in revenue in the fourth quarter, up from $3.8 billion a year earlier.
The company also had higher production costs in the quarter, an ongoing trend that has pushed its share price down from $50 on Feb. 23, 2012 to a Thursday close of $32.59 on the New York Stock Exchange. Total cash costs were $584 per ounce in the fourth quarter, up from $505 per ounce a year earlier. The company’s Northern Nevada mines posted below-average costs, though: Total cash costs per ounce were $242 at Cortez and $506 at Goldstrike.
CEO Jamie Sokalsky said in a statement that investors “are rightfully demanding a fundamental change in the gold industry.” He blamed dropping stock prices on rising costs, poor capital allocation and “the pursuit of production growth at any cost.” Barrick is refocusing its business so that returns will drive production, rather than production driving returns, he added.
Barrick shares closed up 2.6 percent, or 82 cents, on Thursday.
Contact reporter Jennifer Robison at firstname.lastname@example.org or 702-380-4512. Follow @J_Robison1 on Twitter.