Barrick Cash Flow Soars - TheStreet

Barrick Cash Flow Soars

Earnings are a penny better than expectations.
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Barrick Gold

(ABX)

said its third-quarter earnings inched up from a year ago thanks to some one-time items in the most-recent period. Cash flow flourished, however, as the company continued to capitalize on the precious metal's high price.

Barrick earned $35 million, or 7 cents a share, in the latest quarter compared with $34 million, or 6 cents a share, last year. Gold sales totaled $579 million in the most recent quarter, up from $473 million a year ago. Operating cash flow was $188 million in the latest quarter compared with $126 million last year.

Earnings in the latest quarter included an $11 million after-tax gain on the sale of investments and a $20 million charge related to nonhedge derivatives losses.

Analysts had been predicting earnings of 6 cents a share in the quarter, according to Thomson First Call.

Barrick noted that spot gold prices averaged $364 an ounce during the quarter, compared with an average spot price of $314 an ounce in the year-earlier quarter, and said it realized an average of $365 an ounce on its gold sales.

Meanwhile, the company produced 1.48 million ounces of gold at total cash costs of $180 an ounce in the third quarter, compared with 1.38 million ounces of gold at total cash costs of $180 an ounce last year.

The company warned production is expected to be about 10% lower and cash costs about 10% higher in 2004 compared with 2003, primarily as a result of lower grades at its Pierina and Betze-Post projects.

Barrick closed at $19.56 Monday.