18 Jan Barrick Gold's 2017 Production Review: Gold Production To Experience a Declining Trend
Barrick Gold ( ABX ), the world’s largest gold miner, released its full year production review on January 16 . The company reported a 4% year-over-year decline in gold shipments and a similar decline in its gold production. Production volume was at the bottom end of its revised 2017 production estimates.
Diminishing gold production volume is in line with our earlier analysis of an expected decline in global gold production to support future gold prices . Barrick reported Q4 average realized gold prices at $1,275 per ounce, resulting in an average price for its full year at approximately $1,260/ ounce, at a similar level as that of 2016. Thus, with the decline in gold production and stagnant gold prices, we expect Barrick to report a decline in its revenue for full year 2017. Barrick’s fall in gold output was further exaggerated by the ongoing disruption in Acacia mining, which is expected to be resolved by the first half of 2018.
The following table summarizes the production figures for gold and copper as produced by Barrick. Copper production also remained stagnant in 2017, however copper’s (as a commodity) stellar performance throughout 2017 should provide a boost to Barrick’s copper division. You can view our base case for Barrick’s production volume here and create different scenarios using our interactive platform.
Barrick will release it Q4 and full year financials on February 14 which will provide us a deeper insight into its operational performance for 2017.
We have a $15 price estimate for Barrick Gold’s stock, which is in line with the current market price.
Have more questions about Barrick Gold? See the links below.
- Here’s How a Decline in Gold Production Could Remain an Upside for Gold Producers
- Barrick Gold Earnings Review: Tension in Tanzania Hits Earnings
1) The purpose of these analyses is to help readers focus on a few important things. We hope such communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email [email protected]
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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