For a full explanation of results, the Financial Statements and Management Discussion & Analysis, and mine statistics please see the Company’s website,
THIRD QUARTER REPORT 2010 For a full explanation of results, the Financial Statements OCTOBER 28, 2010 and Management Discussion & Analysis, and mine statistics please see the Company’s website, Based on US GAAP and expressed in US dollars www.barrick.com.
Barrick Reports Q3 2010 Financial and Operating Results
| Highlights | |
| • Reported Q3 net income was a record $837 million ($0.85 per share). Adjusted Q3 net income rose 75% to $829 million ($0.84 per share)1 compared to $473 million ($0.54 per share) in Q3 2009. Operating cash flow also set a new Company record, rising 40% to $1.28 billion from $911 million in the prior year period, demonstrating Barrick's strong leverage to the gold price. • Q3 gold production of 2.06 million ounces was ahead of plan at lower than expected total cash costs of $454 per ounce1 or net cash costs of $349 per ounce1 on strong performance from the North America region, including the new Cortez Hills mine, which continues to exceed expectations. Barrick is on track with its original operating guidance for higher gold production and lower total cash costs in 2010, with full year production expected to be 7.65-7.85 million ounces at total cash costs of about $455 per ounce or net cash costs of $350-$360 per ounce2. • Barrick's cash margins continue to benefit from rising gold prices and lower cash costs. Q3 cash margins increased 52% to $783 per ounce1 from $515 per ounce in Q3 2009 and net cash margins rose 48% to $888 per ounce1 from $600 per ounce in the prior year period. • The Company is targeting growth in gold production to 9.0 million ounces within five years once the world class Pueblo Viejo3 and Pascua-Lama projects come onstream, and as additional opportunities are developed around existing mine sites. • Barrick's positive outlook on the gold price, combined with its strong balance sheet, has positioned the Company to continue to invest in its high return projects and also to return additional capital to shareholders. As a result, Barrick’s Board of Directors has authorized a fourth quarter dividend of 12 cents per share, consistent with the dividend declared in the third quarter which represents a 20% increase from the previous dividend on an annualized basis4. Barrick continues to maintain a robust financial position with the gold industry’s only ‘A’ credit rating, a quarter- end cash balance of $4.3 billion and $1.5 billion in undrawn credit after generating record operating cash flow in excess of $3.3 billion in the first nine months. • During the quarter, Barrick was ranked as a global leader in corporate social responsibility for the third consecutive year by the Dow Jones Sustainability Index (DJSI). Barrick is included on both the Dow Jones Sustainability World Index and North American Index for 2010. |
Q3 production of 2.06 million ounces of gold was $10 per ounce above the average spot price of ahead of plan at lower than expected total cash $1,227 per ounce and 27% higher than the prior costs of $454 per ounce or net cash costs of $349 year period. Cash margins increased 52% to $783 per ounce, primarily due to strong performances per ounce from $515 per ounce in Q3 2009. Net from Cortez, Goldstrike and Veladero. The realized cash margins increased 48% to $888 per ounce gold price for the quarter was $1,237 per ounce1, from $600 per ounce in the same prior year period.
1 Adjusted net income, total cash costs per ounce, net cash costs per ounce, realized price, cash margins and net cash margins per ounce are non-GAAP financial measures. See pages 41-48 of Barrick’s Third Quarter Report.
2 Based on an expected realized copper price of $3.25 per pound for full year 2010.
3 Barrick has a 60% share in the Pueblo Viejo project.
4 Calculated based on converting previous semi-annual dividend of $0.20 per share to a quarterly equivalent.
BARRICK THIRD QUARTER 2010 PRESS RELEASE
Adjusted Q3 net income rose 75% to $829 increasing again in the first quarter of 2011. Full million ($0.84 per share), reflecting higher sales year production from Cortez is anticipated to be at and realized prices for both gold and copper, in the higher end of the original guidance range of conjunction with lower gold cash costs, compared 1.08-1.12 million ounces. Total cash costs are also to $473 million ($0.54 per share) in Q3 2009. expected to be within the original guidance range Reported Q3 net income of $837 million ($0.85 per of $295-$315 per ounce. Cortez Hills continues to share) before net adjustments of $8 million was a operate under the terms of the tailored injunction Company record. Operating cash flow rose 40% to issued by the District Court while the Bureau of a record $1.28 billion from $911 million in the prior Land Management completes a Supplementary year period. Environmental Impact Study (SEIS) on three “Operationally we had an excellent quarter, aspects identified by the 9th Circuit Court of meeting our production and cost targets. Our Appeals. The Company expects completion of the project pipeline continues to be advanced and the SEIS and a Record of Decision to be issued by yearfocus on value creation opportunities has surfaced end or early 2011.
new investment and growth opportunities within The Goldstrike operation also performed ahead our existing asset base. This will support our goal of of expectations, producing 0.38 million ounces at producing nine million ounces annually within the total cash costs of $494 per ounce in Q3, primarily next five years,” said Aaron Regent, Barrick’s due to better than expected grades from the open President and CEO. “The leverage we have to the pit and higher roaster throughput. Full year gold price is also clear and is reflected in the 50% production for the North America region is growth in our operating margins and in our record expected to be in the range of 3.07-3.10 million net income and operating cash flow.” ounces, which is in line with original guidance. Higher expected total cash costs of $480-$500 per PRODUCTION AND COSTS ounce reflect the impact of higher gold prices on Q3 production of 2.06 million ounces was ahead of royalties and production taxes.
plan at lower than expected total cash costs of The South American business unit had a strong $454 per ounce or net cash costs of $349 per quarter, producing 0.52 million ounces at total cash ounce, primarily as a result of a strong costs of $263 per ounce in Q3. The Veladero mine performance from the North America region. The outperformed expectations, producing 0.36 million Company is on track to increase production in 2010 ounces at total cash costs of $250 per ounce on to 7.65-7.85 million ounces of gold at total cash higher grades from the Amable and Filo Federico costs of about $455 per ounce or net cash costs of pits, and is expected to produce over 1.0 million $350-$360 per ounce, in line with original guidance ounces in 2010. The Lagunas Norte operation despite higher royalties associated with the contributed 0.12 million ounces at total cash costs increase in gold prices5. of $204 per ounce. Based on previously disclosed The North America region delivered another changes to the mine plan, production is expected to quarter of results which were ahead of be lower in the fourth quarter but is anticipated to expectations, producing 0.93 million ounces at total increase again in early 2011. Full year production for cash costs of $454 per ounce in Q3. the South America region is expected to be 2.10- The Cortez property continues to perform 2.15 million ounces compared to our revised strongly, producing 0.37 million ounces at total guidance of 2.05-2.10 million ounces. Total cash cash costs of $277 per ounce on higher than costs are expected to be $240-$260 per ounce, in anticipated grades and recoveries from the Cortez line with original guidance.
Hills open pit and underground. Due to mine The Australia Pacific business unit produced sequencing, production from Cortez is expected to 0.48 million ounces at total cash costs of $613 per be lower in the final quarter of the year before ounce in Q3. Strong results from Kalgoorlie and Cowal, both ahead of plan on higher grades, 5 Based on an increase in the full year gold price assumption to $1,200 per ounce from $1,150 per ounce.
BARRICK THIRD QUARTER 2010 2 PRESS RELEASE
partially offset lower than plan production from PROJECTS UPDATE Porgera, which produced 0.11 million ounces at total The Pueblo Viejo project in the Dominican Republic cash costs of $676 per ounce. Full year production is advancing in line with its $3.0 billion capital for the Australia Pacific region is expected to be budget (100% basis). Initial production continues to 1.925-1.975 million ounces at total cash costs of be anticipated in the fourth quarter of 2011, $610-$625 per ounce, which is in line with original although timing delays principally associated with guidance. The Company is fully hedged on all of its the issuance of certain approvals related to power Australian dollar costs for the balance of the year supply may result in first production occurring in Q1 at an average rate of 0.81, effectively fully hedged 2012. At the end of the third quarter, overall for 2011 at an average rate of 0.77, and has construction was nearly 40% complete, substantial coverage for the following three years approximately 75% of the capital had been at rates at or below 0.75. committed and engineering and procurement Attributable production from African Barrick was about 95% complete. About 65% of the Gold plc in Q3 was 0.12 million ounces at total cash planned concrete has been poured and 45% of costs of $696 per ounce6. Barrick’s share of full the steel has been erected. Two of the four year production is now expected to decrease to autoclaves have been placed on their footings, about 0.575 million ounces at total cash costs of with the final two units shipped and expected to $620-$640 per ounce. be onsite in Q4, and 90% of the materials Q3 copper production was 84 million pounds at required for the oxygen plant have been shipped total cash costs of $1.12 per pound. The Company to site. Pre-stripping has been completed and remains on track with its full year copper guidance ore stockpiling has commenced. Work continues and expects to produce about 360 million pounds toward achieving key milestones including the at total cash costs of $1.10-$1.15 per pound. connection of power to the site, which is necessary Utilizing option collar strategies, we have put in to commence commissioning activities in the fourth place floor protection on approximately 80% of our quarter of 2011. Barrick’s 60% share of annual gold expected copper production for the remainder of production in the first full five years of operation is 2010 at an average price of $2.18 per pound and expected to average 625,000-675,000 ounces at can participate in copper price upside on effectively total cash costs of $275-$300 per ounce8.
all of our expected remaining 2010 copper At the Pascua-Lama project on the border of production to a maximum average price of $3.76 Chile and Argentina, detailed engineering and per pound. We have currently hedged procurement is nearly 90% complete and the approximately 60% of our expected 2011 project is on track to enter production in the first production through the use of collars with an quarter of 2013. The project remains in line with its average floor price of $3.00 per pound and an pre-production capital budget of about $3.0 billion average ceiling price of $4.36 per pound. with over 40% of the capital committed. Barrick’s production base is underpinned by the Earthworks have commenced with about 6.8 industry’s largest, fully unhedged gold reserves of million cubic meters moved to date and major 139.8 million ounces, plus measured and indicated earthworks for the mill and Merrill Crowe platforms gold resources of 61.8 million ounces and inferred are expected to be completed in November. In gold resources of 31.6 million ounces7. Chile, the Barriales camp is substantially complete, allowing the work-force to be increased to the permitted capacity, and initial occupancy of the Los Amarillos camp in Argentina is expected in Q4 2010. Average annual gold production from Pascua- 6 US GAAP basis. ABG reports under an IFRS basis.
7 Calculated as at December 31, 2009 in accordance with National Instrument 43-101 as required by Canadian Lama is expected to be 750,000–800,000 ounces securities regulatory authorities. For United States reporting purposes, Industry Guide 7 (under the Securities Exchange Act of 1934), as interpreted by the Staff of the SEC, applies different standards in order to classify mineralization as a reserve. Accordingly, for U.S. reporting purposes, Cerro Casale is classified as mineralized material. For a breakdown of reserves and resources by category and additional information relating to reserves and resources, see pages 23-33 of Barrick’s 2009 Form 40-F/Annual Information Form on file with the U.S. Securities and Exchange Commission and Canadian provincial securities regulatory authorities. 8 Based on gold price and oil price assumptions of $1,100 per ounce and $75 per barrel, respectively.
BARRICK THIRD QUARTER 2010 3 PRESS RELEASE
in the first full five years of operation at total cash the previous dividend on an annualized basis. costs of $20-$50 per ounce9. The Company has now moved from a semi- At the Cerro Casale project in Chile, the review annual dividend to a quarterly dividend12.
of any additional permitting requirements before considering a construction decision is progressing CORPORATE SOCIAL RESPONSIBILITY alongside discussions with the government and During Q3, Barrick was ranked as a global leader in meetings with local communities and indigenous corporate social responsibility for the third groups. Detailed engineering has commenced and is consecutive year by the Dow Jones Sustainability about 20% complete. Pre-production capital is Index (DJSI) and is included on both the Dow Jones expected to be about $4.2 billion (100% basis)10 Sustainability World Index and North American and Barrick’s 75% share of average annual Index for 2010. DJSI tracks the performance of production is anticipated to be about 750,000- 2,500 leading companies worldwide and 825,000 ounces of gold and 170-190 million independently evaluates their long-term economic, pounds of copper in the first full five years of environmental, and social performance using operation at total cash costs of about $240- objective benchmarks.
$260 per ounce11. Barrick was also recognized during the quarter We continue to advance the Donlin Creek as a global carbon disclosure leader in an annual project in Alaska. Further optimization studies survey of companies conducted by the Carbon are underway, primarily focused on the potential Disclosure Project. This independent not-for-profit to utilize natural gas to reduce operating costs. organization serves as the only global climate These feasibility study revisions are expected to change reporting system and holds the largest be completed in the second quarter of 2011. At database of primary corporate climate change the Reko Diq project in Pakistan, the initial mine information in the world. This builds on Barrick’s development feasibility study is complete and long standing commitment and action in corporate the environmental and social impact assessment social responsibility.
is in its final stages.
- * * *
FINANCIAL POSITION At September 30, 2010, Barrick remained in a Barrick’s vision is to be the world’s best gold robust financial position with the gold industry’s company by finding, acquiring, developing and only ‘A’ credit rating, a cash balance of $4.3 billion producing quality reserves in a safe, profitable and and a $1.5 billion undrawn credit facility. The socially responsible manner. Barrick’s shares are Company generated about $1.3 billion in operating traded on the Toronto and New York stock cash flow during the quarter and more than $3.3 exchanges.
billion in operating cash flow in the first nine months of 2010. As a result of the Company's positive outlook on the gold price, its strong financial position and robust operating cash flows, Barrick’s Board of Directors has authorized a fourth quarter dividend of 12 cents per share payable on December 15 to shareholders of record on November 30, consistent with the dividend declared in the third quarter which represents a 20% increase from
9 Total cash costs are calculated net of silver credits assuming silver, gold, and oil prices of $16 per ounce, $1,100 per ounce, $75 per barrel, respectively, and assuming a Chilean peso f/x rate of 500:1.
10 Based on June, 2009 prices and assuming Chilean peso f/x rate of 500:1. 12 The declaration and payment of dividends remains at the discretion of the Board of Directors and will 11 Based on gold price, copper price, and oil price assumptions of $1,100 per ounce, $2.75 per pound and $75 depend on the Company’s financial results, cash requirements, future prospects and other factors deemed per barrel, respectively, and assuming a Chilean peso f/x exchange rate of 500:1. relevant by the Board.
BARRICK THIRD QUARTER 2010 4 PRESS RELEASE
Key Statistics
Barrick Gold Corporation Three months ended Nine months ended (in United States dollars) September 30, September 30, (Unaudited) 2010 2009 2010 2009 Operating Results Gold production (thousands of ounces)1 2,060 1,904 6,065 5,525 Gold sold (thousands of ounces)1 1,944 1,884 5,909 5,480 Per ounce data Average spot gold price $ 1,227 $ 960 $ 1,178 $ 931 Average realized gold price2 1,237 971 1,184 940 Net cash costs5 349 371 346 376
| Total cash costs3 | 454 | 456 | 448 | 463 | |
| Amortization and other4 | 139 | 131 | 135 | 122 | |
| Total production costs | 593 | 587 | 583 | 585 | |
| Copper credits | 105 | 85 | 102 | 87 | |
| Copper production (millions of pounds) | 84 | 104 | 286 | 295 | |
| Copper sold (millions of pounds) | 90 | 86 | 288 | 262 |
Per pound data Average spot copper price $ 3.29 $ 2.65 $ 3.25 $ 2.12 Average realized copper price2 3.39 2.90 3.19 3.03
| Total cash costs3 | 1.12 | 1.05 | 1.10 | 1.21 |
| Amortization and other4 | 0.25 | 0.19 | 0.22 | 0.21 |
| Total production costs | 1.37 | 1.24 | 1.32 | 1.42 |
Financial Results (millions)
Sales $ 2,775 $ 2,038 $ 7,978 $ 5,778
| Net income (loss) | 837 | (5,350) | 2,378 | (4,487) |
| Adjusted net income6 | 829 | 473 | 2,329 | 1,205 |
| Operating cash flow | 1,276 | 911 | 3,346 | 1,978 |
Per Share Data (dollars)
0.85 (6.07) 2.41 (5.12)
Net income (loss) (basic)
| Adjusted net income (basic)6 | 0.84 | 0.54 | 2.36 | 1.38 |
| Net income (loss) (diluted) | 0.84 | (6.07) | 2.39 | (5.12) |
| Weighted average basic common shares (millions) | 986 | 882 | 985 | 876 |
| 998 | 882 | 997 | 876 |
Weighted average diluted common shares (millions)7 As at As at September 30, December 31, 2010 2009 Financial Position (millions)
Cash and equivalents $ 4,281 $ 2,564
| Non-cash working capital | 575 | 655 |
| Adjusted debt8 | 7,272 | 6,919 |
| Net debt9 | 3,116 | 4,355 |
| Equity | 19,307 | 15,547 |
1 Production includes our equity share of gold production at Highland Gold.
2 Realized price is a non-GAAP financial performance measure with no standard meaning under US GAAP. See page 46 of the Company's MD&A.
3 Total cash costs is a non-GAAP financial performance measure with no standard meaning under US GAAP. See page 43 of the Company's MD&A.
4 Represents equity amortization expense, unrealized losses on non-hedge currency and commodity contracts and inventory purchase accounting adjustments at the Company's producing mines, divided by equity ounces of gold sold or pounds of copper sold.
5 Net cash costs is a non-GAAP financial performance measure with no standard meaning under US GAAP. See page 43 of the Company's MD&A.
6 Adjusted net income is a non-GAAP financial performance measure with no standard meaning under US GAAP. See page 41 of the Company's MD&A.
7 Fully diluted, includes dilutive effect of stock options and convertible debt.
8 Adjusted debt is a non-GAAP financial performance measure with no standard meaning under US GAAP. See page 47 of the Company's MD&A.
9 Net debt is a non-GAAP financial performance measure with no standard meaning under US GAAP. See page 47 of the Company's MD&A.
BARRICK THIRD QUARTER 2010 5 SUMMARY INFORMATION
Production and Cost Summary Gold Production (attributable ounces) (000's) Total Cash Costs (US$/oz)
| Three months ended | Nine months ended | Three months ended | Nine months ended | |||
|---|---|---|---|---|---|---|
| September 30, | September 30, | September 30, | September 30, | |||
| (Unaudited) | 2010 | 2009 | 2010 | 2009 | 2010 2009 | 2010 2009 |
| North America1 | 929 | 712 | 2,413 | 2,212 | $454 $ |
518 $ 490 $ 499
| South America | 518 | 509 | 1,743 | 1,347 | 263 | 247 | 228 | 270 |
| Australia Pacific | 483 | 462 | 1,454 | 1,439 | 613 | 585 | 603 | 582 |
| 122 | 213 | 431 | 503 | 696 | 477 | 635 | 517 |
African Barrick Gold4 Other 8 8 24 24 494 410 494 410 Total 2,060 1,904 6,065 5,525 $ 454 $ 456 $ 448 $ 463
Copper Production (attributable pounds) (Millions) Total Cash Costs (US$/lb)
| Three months ended | Nine months ended | Three months ended | Nine months ended | |||
|---|---|---|---|---|---|---|
| September 30, | September 30, | September 30, | September 30, | |||
| (Unaudited) | 2010 | 2009 | 2010 | 2009 | 2010 2009 | 2010 2009 |
| South America | 78 | 76 | 236 | 227 | $ |
1.12 $ 1.11 $ 1.08 $ 1.23 Australia Pacific 6 28 50 68 1.11 0.87 1.19 1.09 Total 84 104 286 295 $ 1.12 $ 1.05 $ 1.10 $ 1.21
Total Gold Production Costs (US$/oz) Three months ended Nine months ended September 30, September 30, (Unaudited) 2010 2009 2010 2009 Direct mining costs at market foreign exchange rates $ 431 $ 441 $ 438 $ 421 (Gains) losses realized on currency hedge and commodity hedge/economic hedge
(12) (1) (17) 19 contracts Adjustments to direct mining costs3
(5) (4) (5) (1)
| By-product credits | (11) | (12) | (14) | (9) |
| Copper credits | (105) | (85) | (102) | (87) |
| Cash operating costs, net basis | 298 | 339 | 300 | 343 |
| Royalties | 35 | 28 | 34 | 28 |
| Production taxes | 16 | 4 | 12 | 5 |
| 349 | 371 | 346 | 376 |
Net cash costs2
| Copper credits | 105 | 85 | 102 | 87 | |
| Total cash costs2 | 454 | 456 | 448 | 463 | |
| Amortization | 134 | 127 | 130 | 121 | |
| Adjustments to direct mining costs3 | 5 | 4 | 5 | 1 | |
| Total production costs | $593 $587 | $583 $585 |
Total Copper Production Costs (US$/lb) Three months ended Nine months ended September 30, September 30, (Unaudited) 2010 2009 2010 2009 Cash operating costs $ 1.11 $ 1.04 $ 1.08 $ 1.20
| Royalties | 0.01 | 0.01 | 0.02 | 0.01 | |
| Total cash costs2 | 1.12 | 1.05 | 1.10 | 1.21 | |
| Amortization | 0.25 | 0.19 | 0.22 | 0.21 | |
| Total production costs | $1.37 $1.24 | $ |
1.32 $ 1.42
1 Production includes an additional 50% interest in Hemlo from January 1, 2009 onwards and Barrick's share of total cash costs increased to 100% effective May 1, 2009.
2 Total cash costs and net cash costs are non-GAAP financial performance measures with no standard meaning under US GAAP.
See page 43 of the Company's MD&A.
3 Represents unrealized losses on non-hedge currency and commodity contracts and the impact of Barrick Energy 4 Figures relating to African Barrick Gold are stated at 100% up to March 31, 2010 and 73.9% thereafter.
BARRICK THIRD QUARTER 2010 6 SUMMARY INFORMATION
Consolidated Statements of Income
Barrick Gold Corporation Three months ended Nine months ended September 30, September 30, (in millions of United States dollars, except per share data) (Unaudited)
2010 2009 2010 2009
Sales (notes 4 and 5) $ 2,775 $ 2,038 $ 7,978 $ 5,778 Costs and expenses
| Cost of sales (notes 4 and 6)1 | 1,065 | 952 | 3,117 | 2,829 |
| Amortization and accretion (notes 4 and 14B) | 317 | 281 | 928 | 801 |
| Corporate administration | 36 | 40 | 113 | 120 |
| Exploration (note 7) | 47 | 42 | 123 | 107 |
| Project development expense (note 7) | 38 | 21 | 90 | 59 |
| Elimination of gold sales contracts | - | 5,692 | - | 5,692 |
| Other expenses (note 8A) | 86 | 85 | 333 | 213 |
| Impairment charges (note 8B) | - | 158 | 7 | 158 |
| 1,589 | 7,271 | 4,711 | 9,979 | |
| Interest income | 5 | 2 | 11 | 7 |
| Interest expense (note 15B) | (42) | (12) | (115) | (28) |
| Other income (note 8C) | 61 | 15 | 85 | 109 |
| Write-down of investments (note 8B) | - | - | - | (1) |
| 24 | 5 | (19) | 87 | |
| Income (loss) from continuing operations before income taxes and other items | 1,210 | (5,228) | 3,248 | (4,114) |
| Income tax expense (note 9) | (368) | (127) | (898) | (353) |
| Loss from equity investees (note 12) | (10) | (23) | (39) | (71) |
| Income (loss) from continuing operations before non-controlling interests | 832 | (5,378) | 2,311 | (4,538) |
| Income from discontinued operations | 10 | 30 | 81 | 55 |
| Income (loss) before non-controlling interests | 842 | (5,348) | 2,392 | (4,483) |
| Non-controlling interests (note 20) | (5) | (2) | (14) | (4) |
837 $ (5,350) $ 2,378 $ (4,487) Net income (loss) $ Earnings (loss) per share data (note 10)
Income (loss) from continuing operations Basic $ 0.84 $ (6.10) $ 2.33 $ (5.18) Diluted $ 0.83 $ (6.10) $ 2.31 $ (5.18) Income from discontinued operations Basic $ 0.01 $ 0.03 $ 0.08 $ 0.06 Diluted $ 0.01 $ 0.03 $ 0.08 $ 0.06 Net income (loss)
Basic $ 0.85 $ (6.07) $ 2.41 $ (5.12) Diluted $ 0.84 $ (6.07) $ 2.39 $ (5.12)
1 Exclusive of amortization.
The notes to these unaudited interim consolidated financial statements, which are contained in the Third Quarter Report 2010 available on our website, are an integral part of these consolidated financial statements.
BARRICK THIRD QUARTER 2010 7 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statements of Cash Flow
Barrick Gold Corporation Three months ended Nine months ended September 30 September 30 (in millions of United States dollars) (Unaudited)
2010 2009 2010 2009 OPERATING ACTIVITIES Net income (loss) $ 837 $ (5,350) $ 2,378 $ (4,487)
| Amortization and accretion (notes 4 and 14B) | 317 | 281 | 928 | 801 |
| Impairment charges and write-down of investments (note 8B) | - | 158 | 7 | 159 |
| Income tax expense (note 9) | 368 | 127 | 898 | 353 |
| (148) | (44) | (493) | (264) |
Income taxes paid
| Net proceeds taxes paid | (3) | (3) | (76) | (26) |
| Increase in inventory | (124) | (80) | (267) | (240) |
| Elimination of gold sales contracts | - | 5,692 | - | 5,692 |
| (Gain) loss on sale/acquisition of long-lived assets (note 8C) | (8) | 1 | (41) | (81) |
| Income from discontinued operations | (10) | (30) | (81) | (55) |
| Operating cash flows of discontinued operations | - | (1) | (4) | 6 |
| Other items (note 11A) | 47 | 160 | 97 | 120 |
| Net cash provided by operating activities | 1,276 | 911 | 3,346 | 1,978 |
INVESTING ACTIVITIES Property, plant and equipment
| Capital expenditures (note 4) | (786) | (535) | (2,178) | (1,603) |
| Sales proceeds | 27 | 3 | 35 | 10 |
| Acquisitions (note 3) | (61) | (53) | (813) | (101) |
Investments
| Purchases | (26) | - | (28) | (2) |
| Sales | 10 | 3 | 10 | 3 |
| Increase in restricted cash | - | - | - | 113 |
| Investing cash flows of discontinued operations | - | - | - | (7) |
| Other investing activities (note 11B) | (12) | (37) | (44) | (71) |
| Net cash used in investing activities | (848) | (619) | (3,018) | (1,658) |
FINANCING ACTIVITIES Capital stock
| Proceeds on exercise of stock options | 18 | 10 | 49 | 31 |
| Proceeds on common share offering | - | 3,885 | - | 3,885 |
| Proceeds from public issuance of common shares by a subsidiary (note 3E) | - | - | 884 | - |
Long-term debt
| Proceeds | - | 69 | 782 | 936 |
| Repayments | (72) | (65) | (147) | (358) |
| Dividends | (118) | - | (315) | (174) |
| Funding from non-controlling interests | 28 | 78 | 12 | 224 |
| Deposit on silver sale agreement | 137 | 213 | 137 | 213 |
| Financing cash flows of discontinued operations | - | - | - | - |
| Other financing activities (note 11C) | (4) | (2) | (22) | (13) |
| Net cash provided by (used in) financing activities | (11) | 4,188 | 1,380 | 4,744 |
| Effect of exchange rate changes on cash and equivalents | 13 | 13 | 9 | 30 |
| Net increase in cash and equivalents | 430 | 4,493 | 1,717 | 5,094 |
| Cash and equivalents at beginning of period(note 15A) | 3,851 | 2,038 | 2,564 | 1,437 |
| Cash and equivalents at end of period(note 15A) | $4,281 | $6,531 | $ |
4,281 $ 6,531
part of these consolidated financial statements.
BARRICK THIRD QUARTER 2010 8 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Balance Sheets
(in millions of United States dollars) (Unaudited) As at September 30, As at December 31,
| 2010 | 2009 |
| ASSETS Current assets Cash and equivalents (note 15A) $ 4,281 Accounts receivable 288 Inventories (note 13) 1,800 Other current assets 649 Assets of discontinued operations - | $ 2,564 251 1,540 524 59 |
| 7,018 Non-current assets Equity in investees (note 12A) 283 Other investments (note 12B) 131 Property, plant and equipment (note 14) 16,669 Goodwill 5,287 Intangible assets 134 Deferred income tax assets 895 Other assets 1,872 Assets of discontinued operations - | 4,938 1,136 92 13,125 5,197 66 949 1,531 41 |
| Total assets $ 32,289 | $ 27,075 |
| LIABILITIES AND EQUITY Current liabilities Accounts payable 1,477 Short-term debt 295 Other current liabilities 685 Liabilities of discontinued operations - | 1,221 54 475 23 |
| 2,457 Non-current liabilities Long-term debt (note 15B) 6,673 Asset retirement obligations 1,204 Deferred income tax liabilities 1,318 Other liabilities (note 17) 1,330 Liabilities of discontinued operations - | 1,773 6,281 1,122 1,184 1,145 23 |
| Total liabilities 12,982 | 11,528 |
| Equity Capital stock (note 18) 17,449 Additional paid-in capital 288 Deficit (319) Accumulated other comprehensive income (note 19) 331 | 17,390 - (2,382) 55 |
| Total shareholders’ equity 17,749 Non-controlling interests (note 20) 1,558 | 15,063 484 |
| Total equity 19,307 | 15,547 |
| Contingencies and commitments (notes 14 and 21) | |
| Total liabilities and equity $ 32,289 | $ 27,075 |
of these consolidated financial statements.
BARRICK THIRD QUARTER 2010 9 FINANCIAL STATEMENTS (UNAUDITED)
Consolidated Statements of Equity
For the nine months ended September 30 (in millions of United States dollars) (Unaudited)
2010 2009 Common shares (number in thousands)
| At January 1 | 984,328 | 872,739 | ||
| Issued on public equity offering | - | 108,973 | ||
| Issued on exercise of stock options | 1,916 | 977 | ||
| Issued on redemption of exchangeable shares | 2 | 267 | ||
| At September 30 (note 18) | 986,246 | 982,956 |
Common shares At January 1 $ 17,390 $ 13,372
| Issued on public equity offering | - | 3,926 |
| Issued on exercise of stock options | 49 | 31 |
| Recognition of stock option expense | 10 | 14 |
| At September 30 | 17,449 | 17,343 |
Additional paid-in capital
| At January 1 | - | - |
| Recognized on initial public offering of African Barrick Gold (note 3E) | 288 | - |
| At September 30 | 288 | - |
Retained earnings (deficit)
| At January 1 | (2,382) | 2,261 |
| Net income (loss) | 2,378 | (4,487) |
| Dividends | (315) | (174) |
| At September 30 | (319) | (2,400) |
| Accumulated other comprehensive income (note 19) | 331 | 37 |
| Total shareholders’ equity | 17,749 | 14,980 |
Non-controlling interests (note 20)
| At January 1 | 484 | 182 |
| Net income attributable to non-controlling interests | 14 | 4 |
| Funding from non-controlling interests | 12 | 216 |
| Other increase in non-controlling interests | 1,048 | - |
| At September 30 | 1,558 | 402 |
19,307 $ 15,382 Total equity at September 30 $
Consolidated Statements of Comprehensive Income
Barrick Gold Corporation Three months ended Nine months ended (in millions of United States dollars) (Unaudited) September 30, September 30, 2010 2009 2010 2009 Net income (loss) $ 837 $ (5,350) $ 2,378 $ (4,487) Other comprehensive income, net of tax (note 19) 425 133 276 393 1,262 $ (5,217) $ 2,654 $ (4,094) Comprehensive income (loss) $
The notes to these unaudited interim consolidated financial statements, which are contained in the Third Quarter Report 2010 available on our website, are an integral part of these consolidated financial statements.
BARRICK THIRD QUARTER 2010 10 FINANCIAL STATEMENTS (UNAUDITED)
CORPORATE OFFICE TRANSFER AGENTS AND REGISTRARS Barrick Gold Corporation CIBC Mellon Trust Company Brookfield Place, TD Canada Trust Tower P.O. Box 7010, Adelaide Street Postal Station Suite 3700 Toronto, Canada M5C 2W9 161 Bay Street, P.O. Box 212 Tel: (416) 643-5500 Toronto, Canada M5J 2S1 Toll-free throughout North America: 1-800-387-0825 Tel: (416) 861-9911 Fax: (416) 861-0727 Fax: (416) 643-5501 Toll-free throughout North America: 1-800-720-7415 Email: [email protected] Email: [email protected] Website: www.cibcmellon.com Website: www.barrick.com BNY MELLON SHAREOWNER SERVICES SHARES LISTED 480 Washington Blvd. – 27th Floor ABX – The New York Stock Exchange Jersey City, NJ 07310 The Toronto Stock Exchange Tel: 1-800-589-9836 Fax: (201) 680-4665 Email: [email protected] Website: www.melloninvestor.com
INVESTOR CONTACT MEDIA CONTACT Deni Nicoski Rod Jiménez Vice President, Investor Relations Vice President, Corporate Affairs Tel: (416) 307-7410 Tel: (416) 307-7427 Email: [email protected] Email: [email protected]
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
Certain information contained in this Third Quarter Report 2010, including any information as to our strategy, projects, plans or future financial or operating performance and other statements that express management's expectations or estimates of future performance, constitute "forward-looking statements”. All statements, other than statements of historical fact, are forward-looking statements. The words “believe”, "expect", "will", “anticipate”, “contemplate”, “target”, “plan”, “continue”, “budget”, “may”, “intend”, “estimate” and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The Company cautions the reader that such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of Barrick to be materially different from the Company's estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. These risks, uncertainties and other factors include, but are not limited to: the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future cash flows; changes in the worldwide price of gold, copper or certain other commodities (such as silver, fuel and electricity); fluctuations in currency markets; changes in U.S. dollar interest rates; risks arising from holding derivative instruments; ability to successfully complete announced transactions and integrate acquired assets; legislative, political or economic developments in the jurisdictions in which the Company carries on business; operating or technical difficulties in connection with mining or development activities; employee relations; availability and costs associated with mining inputs and labor; the speculative nature of exploration and development, including the risks of obtaining necessary licenses and permits and diminishing quantities or grades of reserves; changes in costs and estimates associated with our projects; adverse changes in our credit rating, level of indebtedness and liquidity, contests over title to properties, particularly title to undeveloped properties; the risks involved in the exploration, development and mining business. Certain of these factors are discussed in greater detail in the Company’s most recent Form 40-F/Annual Information Form on file with the U.S. Securities and Exchange Commission and Canadian provincial securities regulatory authorities.
The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.