#BarrickMiningFalls8% 📉 On Monday, shares of Barrick Mining, one of the largest gold producers, plunged 8% after the release of its Q2 report. Despite record gold output of 796,000 ounces and a 44% year-over-year increase in revenue to $5.29 billion, the company fell short of Wall Street expectations: adjusted earnings were $0.82 per share versus a forecast of $0.94. Investors didn’t forgive the miss.
Main reasons for the drop:
1. Rising costs of production. Even with high gold prices, expenses are growing: the cost of gold production jumped to $1,993 per ounce, while operating expenses rose to $1,866. The culprit is higher fuel prices, poorer ore at the Carlin and Cortez mines, and increased royalties. High gold prices can’t keep up with cost growth.
2. The $1.95 billion deal with Newmont. Investors viewed the payout amount as too low. As part of a settlement of the dispute over Nevada Gold Mines, Newmont will pay Barrick $1.95 billion. This clears the way for an IPO of North American assets, but the market had expected more.
Lower production at some mines, higher expenses, and a questionable deal outweighed the positives. Shares fell 8%, reaching the 200-day moving average.

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