I have Barrick. I’ll keep Barrick. It is the very largest. It’s worth following technically, along with the ETFs, GLD and SLV. I need to hold some, just to keep me disciplined and properly following the miners. Whenever I have a question, I know to take a look at ABX, and because I have some… I take a look everyday! This just in on it…

Barrick Gold (NYSE: ABX) – the world’s largest gold miner – produced 1.34 million ounces of gold and generated $2 billion in revenue in the second quarter. Both of these numbers are down from the previous year. But even though they fell slightly short of analyst estimates, the market liked what it saw.

The company continues to make progress on shoring up its balance sheet. Barrick made a series of aggressive acquisitions just before gold prices collapsed. It has since made debt and cost reduction the focus of its efforts.

Its all-in sustaining costs (AISC) are down almost 13% from last year to $782 per ounce. It has done this largely by focusing on high-grade projects. The company generated $275 million in free cash flow (FCF) last quarter – its fifth-straight quarter with positive FCF.

Barrick continues to sell noncore assets in its attempt to reduce debt. So far this year, it has paid down almost $1 billion in debt with a goal of another $1 billion by the end of the year. It announced its intention to sell its 50% stake in Kalgoorlie Consolidated Gold Mines (“KCGM”). KCGM owns Australia’s largest open-pit mine – known as The Super Pit. The company has also approached several South African miners as it shops its 64% stake in Acacia Mining, which explores and operates in Burkina Faso, Kenya, Mali, and Tanzania. That sale alone could fetch close to $2 billion.”

Barrack also has this most interesting thing going for it. They have placed on their board a principal of Goldman Sachs. Never in the history of mining has it been before observed that an investment bank showed so much interest in the precious metals, as did Goldman, when they put one of their own right on the very board of the largest mining firm in the world… the question really needs to be asked… What is it that Goldman knows, that they want to be so familiar with the metals at this point in time??? Care to hazard a guess?

Tomorrow I’ll bring something about Silver Wheaton (SLW).

Here’s to your accumulation of real wealth!
Harold F Crowell


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