Earnings Sag at Barrick Gold

Shares of Barrick Gold (ABX) were lower after the company said second-quarter profit fell by 40% and said its third quarter would be the weakest period of the year.

The Toronto-based gold producer said earnings fell to $34 million, or 6 cents a share, down from $59 million, or 11 cents a share, a year earlier.

Sales fell 8% to $454 million.

The earnings-per-share figure met analysts' consensus estimate, but revenue was below the Street's expectations of $467.5 million.

The company said earnings fell primarily because of lower gold sales and higher total cash costs, which were partially offset by higher gold prices. Total cash costs rose as a result of planned lower production, which was caused by the mining of lower grades, increased energy prices and higher spot gold prices that increased gold-related costs.

Barrick said it now anticipates the third quarter to be the weakest quarter this year, producing fewer ounces than the second quarter at total cash costs above its full-year guidance range. This is primarily due to expected mine sequencing changes at Pierina, mining of lower ore grades including both gold and silver content at Eskay Creek, and higher costs at Goldstrike underground.

Capital expenditures for the full year are now expected to be about $900 million, up from previous guidance of $767 million, primarily because of accelerated equipment purchases at two of its mines and anticipated spending on a new power plant in Nevada in the fourth quarter.

More from Opinion

Elon Musk's Latest Twitter Tirade Is the Dumbest Thing on Wall Street

Elon Musk's Latest Twitter Tirade Is the Dumbest Thing on Wall Street

Elon Musk's Twitter Tirade Is the Dumbest Thing on Wall Street

Elon Musk's Twitter Tirade Is the Dumbest Thing on Wall Street

Why Google's Search Momentum Won't Be Badly Hurt by New EU Rules

Why Google's Search Momentum Won't Be Badly Hurt by New EU Rules

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Time to Talk Tesla: What Happened This Week, Elon?

Time to Talk Tesla: What Happened This Week, Elon?