For a full explanation of results, the Financial Statements and Management Discussion & Analysis, please see the
FIRST QUARTER REPORT 2011 For a full explanation of results, the Financial Statements APRIL 27, 2011 and Management Discussion & Analysis, please see the Based on IFRS and expressed in US dollars Company’s website, www.barrick.com.
Barrick Reports Q1 2011 Financial and Operating Results
| Highlights | |
| Financial and Operating Results • Q1 reported net earnings rose 22% to $1.0 billion ($1.00 per share) from $820 million in the prior year period. Q1 adjusted net earnings increased 32% to $1.0 billion ($1.01 per share)1 from $763 million ($0.78 per share) in Q1 2010, reflecting higher realized prices for both gold and copper and better than expected total gold cash costs. This results in an annualized return on equity of about 20%1. Operating cash flow increased 27% to $1.44 billion from $1.13 billion in the same prior year period. • Q1 gold production of 1.96 million ounces at total cash costs of $437 per ounce and net cash costs of $308 per ounce1 was ahead of plan primarily as a result of higher production from the Cortez, Goldstrike and Veladero mines. The Company is on track to meet its 2011 guidance of 7.6-8.0 million ounces at total cash costs of $450-$480 per ounce or net cash costs of $340-$380 per ounce2, positioning Barrick as one of the lowest cost senior gold producers. • Q1 gold cash margins also continued to benefit from higher gold prices and better than plan cash costs increasing 32% to $952 per ounce1 from $722 per ounce in Q1 2010 and net cash margins rose 32% to $1,081 per ounce1 from $821 per ounce in the prior year period. Copper cash margins increased 33% to $3.00 per pound from $2.25 per pound1 in the prior year period on higher copper prices. This significant margin expansion demonstrates the Company’s exceptional leverage to metal prices. Corporate Development • On April 25, Barrick announced that it had entered into a support agreement with Equinox Minerals Limited (“Equinox”) for Barrick to acquire, through an all-cash offer of C$8.15 per share, all of the issued and outstanding common shares of Equinox by way of a friendly take-over offer (the “Offer”). The acquisition of Equinox would add a high quality, long-life asset to the Company’s portfolio, and is consistent with the strategy of increasing gold and copper reserves through exploration and acquisitions. The transaction is expected to be accretive to earnings and cash flow on a per share basis. Increasing Gold and Copper Reserves through Exploration and Selective Acquisitions • The 2011 exploration budget has been increased by over 50% from the prior year spend to $320-$340 million3 following successful programs in 2010 that replaced gold reserves and increased measured and indicated gold resources by 24% and inferred resources by 18%. Investing in and Developing High Return Projects • The recently expanded Cortez mine continued to perform strongly in Q1 with higher than expected production of 366,000 ounces at total cash costs of $220 per ounce. • The Company continued to advance construction of the Pueblo Viejo and Pascua-Lama projects during the quarter. Once at full capacity, these two mines are anticipated to contribute about 1.4 million ounces of annual production at blended average total cash costs of about $150 per ounce4 at gold and silver prices of $1,100 per ounce and $16 per ounce, respectively. Maximizing the Existing Value of Mines and Properties • At the 75%-owned Turquoise Ridge operation in Nevada, a scoping study was recently completed on the potential to develop a large scale open pit, which could significantly increase annual production. • At the Zaldívar copper mine in Chile, studies are advancing on the potential to significantly increase copper production by investing in a process to treat primary sulfide ore. • At the Lagunas Norte mine in Peru, the Company is advancing the study of a sulfide project, which could add substantial ounces to the current life of mine plan and extend the mine life. Continually Improve Corporate Social Responsibility (CSR) Practices • Barrick has made significant progress on its two new CSR initiatives announced at the end of 2010. The Company expects to have an external CSR Advisory Board established by the end of 2011 and also has nominated an independent Director with a CSR focus for election to the Board of Directors at the Annual General Meeting. |
1 Adjusted net earnings, return on equity, total cash costs, net cash costs, cash margins and net cash margins per ounce/pound are non-GAAP financial measures. See pages 45-51 of Barrick’s First Quarter 2011 Report.
2 Based on an expected realized copper price of $3.75/lb.
3 One-third of 2011 exploration budget is estimated to be capitalized. Barrick’s exploration programs are designed and conducted under the supervision of Robert Krcmarov, Senior Vice President, Global Exploration of Barrick. For information on the geology, exploration activities generally, and drilling and analysis procedures on Barrick’s material properties, see Barrick’s most recent Annual Information Form/Form 40-F on file with Canadian provincial securities regulatory authorities and the U.S. Securities and Exchange Commission.
4 Based on the estimated cumulative average annual production in the first full 5 years once both are at full capacity. Blended average total cash costs assume gold, silver, copper and oil price assumptions of $1,100/oz, $16/oz, $2.75/lb, $85/bbl and assuming a Chilean peso f/x rate of 500:1.
BARRICK FIRST QUARTER 2011 PRESS RELEASE
FINANCIAL AND OPERATING RESULTS shareholders’ gold exposure per share, and it Q1 production of 1.96 million ounces of gold at total enhances copper exposure and leverage per share in a strong copper price environment. Combined cash costs of $437 per ounce and net cash costs of $308 per ounce was ahead of budget primarily due with our Zaldívar mine and Cerro Casale project in to strong performances from Cortez, Goldstrike and Chile, this acquisition would position Barrick with Veladero. The Company is on track to achieve its significant production growth potential in two of full year operating guidance of 7.6-8.0 million the most prolific copper-producing regions of the world.”
ounces at total cash costs of $450-$480 per ounce and net cash costs of $340-$380 per ounce, The North America region performed ahead of positioning Barrick as one of the lowest cost senior plan in Q1, producing 0.86 million ounces at total gold producers. Q1 gold cash margins increased cash costs of $396 per ounce primarily due to 32% to $952 per ounce from $722 per ounce in Q1 higher production from Cortez and Goldstrike. 2010 and net cash margins increased 32% to $1,081 Cortez production of 0.37 million ounces at total per ounce from $821 per ounce in the same prior cash costs of $220 per ounce in Q1 exceeded plan year period. First quarter copper cash margins on higher than budgeted grades from Cortez Hills. increased 33% to $3.00 per pound from $2.25 In March, the federal Bureau of Land Management per pound in the prior year period on higher issued a Record of Decision approving the copper prices. This significant margin expansion Supplementary Environmental Impact Statement demonstrates the Company’s exceptional leverage for Cortez Hills effective March 15, 2011, which to metal prices. enabled the operation to immediately revert to its Q1 adjusted net earnings rose 32% to $1.0 original scope.
billion ($1.01 per share), reflecting higher realized The Goldstrike operation performed strongly in prices for both gold and copper and better than Q1, producing 0.29 million ounces at total cash expected total gold cash costs, compared to costs of $461 per ounce on higher than expected adjusted net earnings of $763 million ($0.78 per grades from the open pit and underground mines. share) in the prior year period. Q1 adjusted net Full year 2011 production for the North America earnings translates to an annualized return on region is 3.30-3.46 million ounces at total cash equity of about 20%. First quarter reported net costs of $425-$450 per ounce.
earnings were $1.0 billion ($1.00 per share) before The South American business unit also net adjustments of $3 million. Q1 operating cash performed ahead of plan, with production of 0.50 flow increased 27% to $1.44 billion compared to million ounces at total cash costs of $340 per $1.13 billion in the same period a year ago. ounce in Q1. The Veladero mine produced 0.27 “First quarter operating results exceeded our million ounces at total cash costs of $312 per ounce expectations and combined with strong metal in Q1 due to a higher than planned drawdown of prices and good cost control, resulted in significant leach pad inventory. The Lagunas Norte operation growth in earnings and operating cash flow,” said contributed 0.19 million ounces at total cash costs Aaron Regent, Barrick’s President and CEO. “The of $282 per ounce in line with expectations. In 2011, newly expanded Cortez mine made an outstanding South America production is expected to be 1.80contribution and is on track to deliver a full year of 1.935 million ounces at total cash costs of $350low cost production of over 1.3 million ounces in $380 per ounce.
2011. We look forward to adding new low cost The Australia Pacific business unit produced production from Pueblo Viejo and Pascua-Lama as 0.46 million ounces at total cash costs of $585 per we target nine million ounces of annual gold ounce in Q1. The Porgera mine produced 0.13 production. In addition, the acquisition of Equinox million ounces at total cash costs of $476 per would add another high quality, long-life asset to ounce. Production from Porgera was impacted by our portfolio. The transaction does not dilute our pit wall remediation activities and heavy rainfall
BARRICK FIRST QUARTER 2011 2 PRESS RELEASE
which restricted access to the higher grade ore CORPORATE DEVELOPMENT during the quarter. Australia Pacific is expected to On April 25, Barrick announced that it had entered produce 1.85-2.00 million ounces at total cash costs into a support agreement with Equinox for Barrick of $610-$635 per ounce in 2011. to acquire, through an all-cash offer, all of the Attributable production from African Barrick issued and outstanding common shares of Equinox Gold plc in Q1 was 0.13 million ounces at total cash for C$8.15 per share, or a total of approximately costs of $658 per ounce. Barrick’s share of 2011 C$7.3 billion.
production is expected to be 0.515-0.560 million The acquisition of Equinox would add a high ounces at total cash costs of $590-$650 quality, long-life asset to the Company’s portfolio per ounce. and is consistent with the strategy of increasing Q1 copper production of 75 million pounds at gold and copper reserves through exploration and total cash costs of $1.25 per pound was in line with acquisitions. The transaction is expected to be expectations. Barrick has secured contracts for accretive to cash flow and earnings on a per share essentially all of its sulfuric acid supply required in basis. It does not dilute Barrick shareholders’ gold 2011 at prices well below the current market price. exposure per share, and it enhances copper Utilizing option collar strategies, the Company has exposure and leverage per share in a strong copper put in place floor protection at an average price of price environment. Combined with the Zaldívar about $3.00 per pound on approximately 60% of mine and the Cerro Casale project in Chile, this the remaining expected 2011 production and can acquisition would position Barrick with significant participate in upside up to an average ceiling price production growth potential in two of the most of about $4.89 per pound on approximately 70% of prolific copper-producing regions of the world. the expected remaining 2011 production5. The Offer commenced on April 26, 2011 and will About 60% of the Barrick’s consolidated be open for acceptance for a period of not less than production costs are denominated in US dollars. 35 days from its commencement and will be The largest single currency exposure for the conditional upon, among other things, valid Company is the Australian dollar/US dollar acceptances of the Offer in respect of shares exchange rate. Barrick is 95% hedged on its representing (together with shares owned by expected remaining Australian operating and Barrick6 ) not less than 66 2/3% of the Equinox capital expenditures in 2011 at an effective average shares on a fully diluted basis. In addition, the Offer rate of $0.78 and has substantial coverage for the will be subject to certain customary conditions, following three years at rates at or below $0.75. including receipt of relevant regulatory approvals The Company also has mitigated the impact of and the absence of a material adverse change with higher oil prices through the use of financial respect to Equinox.
contracts and production from Barrick Energy such that a $10 change in WTI crude oil prices is only INCREASING GOLD AND COPPER RESERVES expected to impact 2011 total cash costs by about THROUGH EXPLORATION AND SELECTIVE $1 per ounce. The Barrick Energy contribution, ACQUISITIONS along with the financial contracts provides hedge Exploration activities in 2011 are ramping up with protection for approximately 84% of the expected some early indications of positive results in North remaining 2011 fuel consumption. Beyond 2011, and South America. The 2011 exploration budget financial contracts provide substantial hedge has been increased by more than 50% to $320coverage in 2012 and 2013 and production from $340 million from the prior year actual spend Barrick Energy will continue to provide long term following a successful 2010 program that replaced natural offsets to expected energy costs.
6 Barrick currently owns 18.2 million shares of Equinox, representing about 2% of its shares on a fully diluted basis.
5 Excludes any production from the proposed acquisition of Equinox. The realized price on all expected 2011 production is anticipated to be negatively impacted by about $0.12/lb as a result of the net premium paid on option hedging strategies.
BARRICK FIRST QUARTER 2011 3 PRESS RELEASE
gold reserves7 and increased measured and average 625,000-675,000 ounces at total cash indicated gold resources by 24% and inferred costs of $275-$300 per ounce9.
At the Pascua-Lama project in Chile and resources by 18%7. The budget is weighted towards near-term resource additions and conversion at Argentina, work progressed on both sides of the border during the quarter. Over 45% of the preexisting mines while still providing support for earlier stage exploration in operating districts and production capital budget of $3.3-$3.6 billion has other emerging areas. North America is expected to been committed. First production continues to be expected in the first half of 2013. Earthworks are be allocated about 43% of the total budget, the majority of which is targeted for Nevada. About more than 65% complete, construction of the power transmission line is progressing and the new 24% is expected to be spent in the Australia Pacific region. Approximately 15% is targeted for the access road is expected to be available in the South America region with the remainder divided second quarter of 2011. In Argentina, the platforms for the ore stockpile and grinding areas are nearing between Africa and other emerging areas.
completion, which will allow the first concrete to be poured for the process plant in Q2 2011. Occupancy INVESTING IN AND DEVELOPING HIGH RETURN PROJECTS of the construction camps in Chile and Argentina Production of 9 million ounces of gold8 is targeted continues to ramp up with more than 3,200 housed on site. Preparations are underway to commence within the next five years and total cash costs are expected to benefit from low cost projects, pre-strip mining in Q4 2011. Average annual gold production is expected to be 750,000–800,000 primarily Pueblo Viejo and Pascua-Lama, as these mines come on stream. Once at full capacity, these ounces in the first full five years of operation at low two mines are expected to reduce Barrick’s overall total cash costs of $20-$50 per ounce based on a silver price of $16 per ounce. Average annual silver total cash costs by about 20% based on a market silver price of approximately $40 per ounce. production for the first full five years is expected to be about 35 million ounces. For every $1 per ounce At the Pueblo Viejo project in the Dominican Republic, overall construction is 55% complete and increase in the silver price, total cash costs are about 80% of the pre-production capital budget of expected to decrease by about $35 per ounce over $3.3-$3.5 billion (100% basis) has been committed. this period.
The environmental permits for temporary power At the Cerro Casale project in Chile, the sources, necessary for commissioning to preparation of necessary permitting documentation commence in Q4 2011, were secured during the for the submission of the Environmental Impact quarter. First production is expected in the first Assessment is underway alongside discussions with quarter of 2012. Two of the four autoclaves have the government and meetings with local been brick-lined in preparation for operation. About communities and indigenous groups. Early 85% of the planned concrete has been poured, indications suggest that the capital cost may be approximately 85% of the steel has been erected higher by about 20-25% from the previous and more than 3.2 million tons of ore have been estimate of $4.2 billion (100% basis), which is stockpiled. Work continues toward achieving key based on the feasibility study completed in 2009 milestones including the connection of power to the and reflects the impact of a stronger Chilean peso, site. Barrick’s 60% share of annual gold production higher labor, commodity and other input costs. in the first full five years of operation is expected to Barrick’s 75% share of average annual production is anticipated to be about 750,000-825,000 ounces of gold and 170-190 million pounds of 7 Gold reserves and resources as at December 31, 2010 have been calculated using an assumed gold price of copper in the first full five years of operation at $1,000/oz and $1,200/oz, respectively.
8 The target of 9 Moz of annual production within 5 years reflects a current assessment of the expected production and timeline to complete and commission Barrick’s projects currently in construction (Pueblo Viejo and Pascua-Lama) and the Company’s current assessment of existing mine site opportunities, some of which are sensitive to metal price and various capital and input cost assumptions.
9 Based on gold price and oil price assumptions of $1,100/oz and $85/bbl, respectively.
10 Based on gold price, silver price and oil price assumptions of $1,100/oz, $16/oz, and $85/bbl respectively and assuming a Chilean peso f/x rate of 500:1.
BARRICK FIRST QUARTER 2011 4 PRESS RELEASE
total cash costs of about $240-$260 per ounce11, Q2 2012 along with an associated environmental also based on the feasibility study completed in baseline study followed by a feasibility study. At the Lagunas Norte mine, the Company is 2009. An update on the project will be provided with the second quarter 2011 results release. advancing an opportunity to add substantial gold production which could extend the mine life by MAXIMIZING THE VALUE OF EXISTING MINES treating mineralized material from below the AND PROPERTIES current final pit14. During 2010, the metallurgical process to treat sulfide and carbonaceous At the 75%-owned Turquoise Ridge operation in Nevada, there is the potential to develop a large refractory material was defined. Work on the associated environmental, geotechnical and scale open pit in order to mine the lower grade halo around the high grade underground ore. Based on a hydrology studies as well as infrastructure and the recently completed scoping study, an open pit tailings impoundment definition will be initiated in June 2011. A scoping study is expected to be operation that would operate concurrently with an underground mine could significantly increase completed in the fourth quarter of 2011 followed by a prefeasibility study with detailed engineering. annual production. Estimates are based on an acid autoclaving with CIL processing option at a rate of 15 Ktpd at the existing autoclave facility at CONTINUALLY IMPROVING CSR PRACTICES Barrick has made significant progress on its two Goldstrike12. A prefeasibility study is underway and is expected to be completed in 2012. Infill drilling of new CSR initiatives announced at the end of 2010. The Company expects to have an external CSR the lower grade halo has commenced and initial results are confirming expectations. The total Advisory Board, which will provide independent budgeted spend in 2011 is just over $60 million advice on challenging CSR issues and encourage further innovation and leadership in this area, (100% basis) and the work plan includes ongoing infill drilling and geotechnical drilling, metallurgical established by the end of 2011. Barrick has also nominated an independent Director with a CSR testing and process option trade-off studies as well as environmental baseline work to support future focus for election to its Board of Directors at the permitting efforts. Annual General Meeting.
At the Zaldívar mine, a conceptual engineering In recognition of all of the Company’s study on the treatment of primary sulfide material performance, Barrick was listed on the Dow Jones has been completed which indicates copper Sustainability World Index for the third year in a production could potentially increase significantly row and is also the only Canadian mining company with the addition of a 120-140 Ktpd concentrator . to be ranked one of the world’s top 100 sustainable A total of 68,000 meters of exploration drilling has companies by NASDAQ.
been completed on the primary sulfide material, * * * * which sits below the current life of mine open pit. A Barrick’s vision is to be the world’s best gold prefeasibility study is expected to be completed in company by finding, acquiring, developing and producing quality reserves in a safe, profitable and socially responsible manner. Barrick’s shares are 11 Based on gold price, copper price and oil price assumptions of $1,100/oz, $2.75/lb and $85/bbl, respectively and a Chilean peso f/x rate of 500:1. traded on the Toronto and New York stock 12 Based on an open pit cutoff assumption of 0.04 opt and gold price assumption of $975/oz for exchanges.
determination of the open pit shell and assuming an approximate 0.04 opt cut-off grade compared to the current underground cut-off grade of about 0.25 opt . The attributes are based on the most favorable case examined in the scoping study. There are significant elements of the case which need extensive further study and will begin to be considered in the prefeasibility stage currently in progress (e.g. all metallurgical test work, geotechnical evaluation, design of waste rock facilities). Significant optimization work will be required in prefeasibility stage to determine the most economical combination of open pit, underground mining and processing. Feasibility, permitting and construction are estimated to take approximately 8 years. Key permits and approvals needed include: Environmental Impact Statement, Plan of Operations Approval, Clean Water Act Section 404 Permitting, Mercury Control Permits, and Water Pollution Control Permit. Additional exploration is required to define additional mineral resources and it is uncertain whether Barrick will be able to define such mineral resources.
13 Based on a preliminary open pit cut-off grade of 0.26% Cu equivalent and metal price of $2.50/lb Cu to 14 Based on an average 0.8 gpt gold equivalent cut-off grade and a gold price of $1000/oz to determine the determine the pit shell. Additional studies are required to verify applicable geotechnical constraints, pit shell for the expansion. Key next steps include definition of geotechnical constraints, overall water hydrology, metallurgical optimization, environmental baseline, and permitting requirements. Additional balance, material handling considerations, environmental baseline and permitting requirements. Additional exploration is required to define additional mineral resources and it is uncertain whether Barrick will be able exploration is required to define additional mineral resources and it is uncertain whether Barrick will be able to define such mineral resources. to define such mineral resources.
BARRICK FIRST QUARTER 2011 5 PRESS RELEASE
Key Statistics
Barrick Gold Corporation Three months ended (in United States dollars) March 31, (Unaudited) 2011 2010 Operating Results Gold production (thousands of ounces)1 1,957 2,061 Gold sold (thousands of ounces) 1,862 2,059 Per ounce data Average spot gold price $ 1,386 $ 1,109 Average realized gold price2 1,389 1,114 Net cash costs2 308 293 Total cash costs2 437 392 Depreciation3 142 133 Other4 16 5
| Total production costs | 595 | 530 | |
| Copper credits | 129 | 99 | |
| Copper production (millions of pounds) | 75 | 100 | |
| Copper sold (millions of pounds) | 80 | 93 |
Per pound data
| Average spot copper price | $4.38 | $3.29 |
| Average realized copper price2 | 4.25 | 3.29 |
| Total cash costs2 | 1.25 | 1.04 |
Depreciation3 0.24 0.21 Total production costs 1.49 1.25 Financial Results (millions)
Revenues $ 3,090 $ 2,581 Net earnings5 1,001 820 Adjusted net earnings2 1,004 763 Operating cash flow 1,435 1,130 Free cash flow2 364 421 Per Share Data (dollars)
1.00 0.83 Net earnings (basic)
| Adjusted net earnings (basic)2 | 1.01 | 0.78 |
| Net earnings (diluted) | 1.00 | 0.82 |
| Weighted average basic common shares (millions) | 999 | 984 |
Weighted average diluted common shares (millions)6 1,001 996 As at As at March 31, December 31, 2011 2010 Financial Position (millions)
| Cash and equivalents | $4,443 | $3,968 |
| Non-cash working capital | 600 | 656 |
| Adjusted debt2 | 6,490 | 6,392 |
| Net debt2 | 2,050 | 2,427 |
| Shareholders' equity | 20,485 | 19,472 |
Return on equity2 20% 20% 1 Production includes our equity share of gold production at Highland Gold.
2 Realized price, net cash costs, total cash costs, adjusted net earnings, free cash flow, adjusted debt, net debt and return on equity are non-GAAP financial performance measures with no standard definition under IFRS. See pages 45 - 51 of the Company's MD&A.
3 Represents equity amortization expense divided by equity ounces of gold sold or pounds of copper sold.
4 Represents the impact of Barrick Energy and realized gains and losses on non-hedge commodity contracts at the Company's producing mines, divided by equity ounces of gold sold or pounds of copper sold.
5 Net earnings represents net income attributable to the equity holders of the Company.
6 Fully diluted includes dilutive effect of stock options and convertible debt.
BARRICK FIRST QUARTER 2011 6 SUMMARY INFORMATION
Production and Cost Summary Gold Production Total Cash Costs (attributable ounces) (000's) ($/oz)
Three months ended Three months ended March 31, March 31, (Unaudited) 2011 2010 2011 2010 Gold North America 862 729 $ 396 $ 456
| South America | 498 | 659 | 340 | 179 |
| Australia Pacific | 459 | 489 | 585 | 554 |
| African Barrick Gold3 | 129 | 177 | 658 | 517 |
| Other | 9 | 7 | 475 | 494 |
| Total | 1,957 | 2,061 $ |
437 $ 392
Copper Production Total Cash Costs (attributable pounds) (Millions) ($/lb)
Three months ended Three months ended March 31, March 31, (Unaudited) 2011 2010 2011 2010 Copper 75 100 $ 1.25 $ 1.04
Total Gold Production Costs ($/oz)
Three months ended March 31, (Unaudited) 2011 2010 Direct mining costs at market foreign exchange rates $ 481 $ 405
| (Gains) losses realized on currency hedge and commodity hedge/economic hedge contracts | (46) | (24) |
| Adjustments to direct mining costs2 | (16) | (5) |
| By-product credits | (18) | (17) |
| Copper credits | (129) | (99) |
| Cash operating costs, net basis | 272 | 260 |
| Royalties | 36 | 33 |
Net cash costs1 308 293 Copper credits 129 99 Total cash costs1 437 392 Depreciation 142 133 Adjustments to direct mining costs2 16 5 595 $ 530 Total production costs $
Total Copper Production Costs ($/lb)
Three months ended March 31, (Unaudited) 2011 2010 1.24 $ 1.02 Cash operating costs $
| Royalties | 0.01 | 0.02 |
| Total cash costs1 | 1.25 | 1.04 |
| Depreciation | 0.24 | 0.21 |
1.49 $ 1.25 Total production costs $
1 Total cash costs and net cash costs are non-GAAP financial performance measures with no standard definition under IFRS.
See page 47 of the Company's MD&A.
2 Represents realized gains and losses on non-hedge currency and commodity contracts and the impact of Barrick Energy's net contribution.
3 Figures relating to African Barrick Gold are presented on a 100% basis up to March 31, 2010 and a 73.9% basis thereafter, which reflects our equity share of production.
BARRICK FIRST QUARTER 2011 7 SUMMARY INFORMATION
Consolidated Statements of Income
Barrick Gold Corporation Three months ended (in millions of United States dollars, except per share data) (Unaudited) March 31,
Revenue (notes 5 and 6) $ 3,090 $ 2,581 Costs and expenses
| Cost of sales (notes 5 and 7) | 1,357 | 1,268 |
| Corporate administration | 42 | 33 |
| Exploration and evaluation (note 8) | 65 | 44 |
| Other expense (note 10A) | 130 | 80 |
| Impairment charges (reversals) (note 10B) | - | (35) |
1,594 1,390
| Other income (note 10C) | 72 | 49 |
| Income (loss) from equity investees (note 14) | 1 | (15) |
| Gain (loss) on non-hedge derivatives (note 18E) | (31) | 27 |
| Income before finance items and income taxes | 1,538 | 1,252 |
Finance items (note 11)
| Finance income | 3 | 4 |
| Finance costs | (32) | (66) |
| Income before income taxes | 1,509 | 1,190 |
| Income tax expense (note 12) | (494) | (405) |
| Income from continuing operations | 1,015 | 785 |
| Income from discontinued operations (note 4D) | - | 35 |
1,015 $ Net income $ Attributable to:
Equity holders of Barrick Gold Corporation $ 1,001 $ Non-controlling interests (note 22) $ 14 $ -
Earnings per share data attributable to the equity holders of Barrick Gold Corporation (note 9)
Income from continuing operations Basic $ 1.00 $ 0.80 Diluted $ 1.00 $ 0.79 Income from discontinued operations Basic $
- $ 0.03
Diluted $
- $ 0.03
Net income Basic $ 1.00 $ 0.83 Diluted $ 1.00 $ 0.82
The notes to these unaudited interim consolidated financial statements, which are contained in the First Quarter Report 2011 available on our website, are an integral part of these consolidated financial statements.
BARRICK FIRST QUARTER 2011 8 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statements of Comprehensive Income
Three months ended (in millions of United States dollars) (Unaudited) March 31,
Net income $ 1,015 $ Other comprehensive income, net of taxes
| Unrealized gains (losses) on available-for-sale ("AFS") financial securities, net of tax $4, $1 | 10 | (2) |
| Unrealized gains on derivatives designated as cash flow hedges, net of tax $31, $29 | 142 | 88 |
| Realized gains on derivatives designated as cash flow hedges, net of tax $16, $9 | (73) | (28) |
| Currency translation adjustments, net of tax $nil, $nil | 28 | 6 |
| Total other comprehensive income | 107 | 64 |
1,122 $ Total comprehensive income $ Attributable to:
Equity holders of Barrick Gold Corporation $ 1,108 $ 884 Non-controlling interests $ 14 $ -
The notes to these unaudited interim consolidated financial statements, which are contained in the First Quarter Report 2011 available on our website, are an integral part of these consolidated financial statements.
BARRICK FIRST QUARTER 2011 9 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statements of Cash Flow
Barrick Gold Corporation Three months ended March 31, (in millions of United States dollars) (Unaudited)
2011 2010 OPERATING ACTIVITIES Net income $ 1,015 $ 820 Adjusted for the following items:
| Depreciation | 304 | 306 |
| Accretion | 7 | 7 |
| Impairment charges (reversals) (note 10B) | - | (35) |
| Income tax expense (note 12) | 494 | 405 |
| Increase in inventory | (56) | (49) |
| (Gain) loss on non-hedge derivatives | 31 | (27) |
| Gain on sale/acquisition of long-lived assets/investments | (70) | (46) |
| Income from discontinued operations | - | (35) |
| Operating cash flows of discontinued operations | - | (3) |
| Other (note 13A) | 18 | (2) |
| Operating cash flows before interest and income taxes | 1,743 | 1,341 |
| Net interest paid | (20) | (38) |
| Income taxes paid | (288) | (173) |
| Net cash provided by operating activities | 1,435 | 1,130 |
INVESTING ACTIVITIES Property, plant and equipment
| Capital expenditures (note 5) | (1,071) | (709) |
| Sales proceeds | 30 | 5 |
| Acquisitions (note 4) | (25) | (447) |
Investments
| Purchases | (7) | (1) |
| Sales | 20 | - |
| Investing cash flows of discontinued operations | - | - |
| Other investing activities (note 13B) | (10) | (18) |
| Net cash used in investing activities | (1,063) | (1,170) |
FINANCING ACTIVITIES Proceeds on exercise of stock options 21 5 Proceeds from public issuance of common shares by a subsidiary (note 4B) - 834 Long-term debt
| Proceeds | 159 | - |
| Repayments | (2) | (6) |
| Dividends | (120) | - |
| Funding from non-controlling interests | 57 | 94 |
| Financing cash flows of discontinued operations | - | - |
| Other financing activities (note 13C) | (15) | 14 |
| Net cash provided by financing activities | 100 | 941 |
| Effect of exchange rate changes on cash and equivalents | 3 | 3 |
| Net increase in cash and equivalents | 475 | 904 |
| Cash and equivalents at beginning of period(note 18A) | 3,968 | 2,564 |
| Cash and equivalents at end of period(note 18A) | $4,443 | $ |
3,468
The notes to these unaudited interim consolidated financial statements, which are contained in the First Quarter Report 2011 available on our website, are an integral part of these consolidated financial statements.
BARRICK FIRST QUARTER 2011 10 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Balance Sheets
(in millions of United States dollars) (Unaudited) As at March 31, As at December 31, As at January 1,
| 2011 | 2010 | 2010 |
| ASSETS Current assets Cash and equivalents (note 18A) $ 4,443 Accounts receivable 315 Inventories (note 15) 1,808 Other current assets 1,125 | $ 3 ,968 370 1,798 935 | $ 2,564 259 1,488 518 |
| Total current assets (excluding assets classified as held for sale) 7,691 Assets classified as held for sale - | 7,071 - | 4,829 100 |
| Total current assets 7,691 Non-current assets Equity in investees (note 14) 407 Other investments 194 Property, plant and equipment (note 16) 18,772 Goodwill (note 17) 6,099 Intangible assets 479 Deferred income tax assets 585 Other assets 1,812 | 7,071 396 171 17,890 6,096 475 625 1,913 | 4,929 1,124 62 13,378 5,197 275 601 1,358 |
| Total assets $ 36,039 | $ 3 4,637 | $ 26,924 |
| LIABILITIES AND EQUITY Current liabilities Accounts payable 1,455 Debt 14 Current income tax liabilities 738 Other current liabilities 323 | 1,511 14 550 416 | 1,221 54 104 366 |
| Total current liabilities (excluding liabilities classified as held for sale) 2,530 Liabilities classified as held for sale - | 2,491 - | 1,745 49 |
| Total current liabilities 2,530 Non-current liabilities Debt (note 18B) 6,772 Provisions (note 20) 1,862 Deferred income tax liabilities 2,011 Other liabilities (note 19) 563 | 2,491 6,624 1,768 1,971 566 | 1,794 6,124 1,408 960 884 |
| Total liabilities 13,738 | 13,420 | 11,170 |
| Equity Capital stock (note 21) 17,845 Retained earnings (deficit) 1,492 Accumulated other comprehensive income 834 Other 314 | 17,820 611 727 314 | 17,392 (2,535) 232 143 |
| Total equity attributable to Barrick Gold Corporation shareholders 20,485 Non-controlling interests (note 22) 1,816 | 19,472 1,745 | 15,232 522 |
| Total equity 22,301 | 21,217 | 15,754 |
| Contingencies and commitments (note 16 and 23) | ||
| Total liabilities and equity $ 36,039 | $ 3 4,637 | $ 26,924 |
The notes to these unaudited interim consolidated financial statements, which are contained in the First Quarter Report 2011 available on our website, are an integral part of these consolidated financial statements.
BARRICK FIRST QUARTER 2011 11 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statements of Changes in Equity
Barrick Gold Corporation Attributable to equity holders of the company
Accumulated Retained other Total equity earnings comprehensive attributable to Non-controlling Capital stock (deficit) income Other1 shareholders interests Total equity (in millions of United States dollars) (Unaudited)
At January 1, 2011 $ 17,820 $ 611 $ 727 $ 314 $ 19,472 $ 1,745 $ 21,217
| Net income | - | 1,001 | - | - | 1,001 | 14 | 1,015 |
| Total other comprehensive income | - | - | 107 | - | 107 | - | 107 |
| Total comprehensive income | - | 1,001 | 107 | - | 1,108 | 14 | 1,122 |
Transactions with owners
| Dividends | - | (120) | - | - | (120) | - | (120) | |
| Issued on exercise of stock options | 21 | - | - | - | 21 | - | 21 | |
| Recognition of stock option expense | 4 | - | - | - | 4 | - | 4 | |
| Funding from non-controlling interests | - | - | - | - | - | 57 | 57 | |
| Total transactions with owners | 25 | (120) | - | - | (95) | 57 | (38) |
At March 31, 2011 $ 17,845 $ 1,492 $ 834 $ 314 $ 20,485 $ 1,816 $ 22,301
At January 1, 2010 $ 17,392 $ (2,535) $ 232 $ 143 $ 15,232 $ 522 $ 15,754
| Net income | - | 820 | - | - | 820 | - | 820 |
| Total other comprehensive income | - | - | 64 | - | 64 | - | 64 |
| Total comprehensive income | - | 820 | 64 | - | 884 | - | 884 |
Transactions with owners
| Dividends | - | - | - | - | - | - | - |
| Issued on exercise of stock options | 5 | - | - | - | 5 | - | 5 |
| Recognition of stock option expense | 2 | - | - | - | 2 | - | 2 |
Recognized on initial public offering of
| African Barrick Gold (note 4B) | - | - | - | 251 | 251 | - | 251 |
| Funding from non-controlling interests | - | - | - | - | - | 94 | 94 |
| Other increase in non-controlling interests | - | - | - | - | - | 1,037 | 1,037 |
| Total transactions with owners | 7 | - | - | 251 | 258 | 1,131 | 1,389 |
At March 31, 2010 $ 17,399 $ (1,715) $ 296 $ 394 $ 16,374 $ 1,653 $ 18,027
1 Includes additional paid-in capital as at March 31, 2011: $276 million (December 31, 2010: $276 million; March 31, 2010: $251 million; January 1, 2010: $ nil) and convertible borrowings - equity component as at March 31, 2011: $38 million (December 31, 2010: $38 million; March 31, 2010: $143 million; January 1, 2010: $143 million).
BARRICK FIRST QUARTER 2011 12 FINANCIAL STATEMENTS (UNAUDITED)