Barrick Gold Corp., the world's biggest gold producer, said Wednesday its first-quarter profit more than doubled on surging prices, driven by strong investor demand and signs of an improving economy.
Barrick was the second gold mining giant in as many days to report a healthy boost in earnings. Newmont Mining Corp., also said its first-quarter profit more than doubled.
Much of the interest in gold has come from investors who put money into the precious metal as an alternative to stocks and as a hedge against inflation. In addition, there has been growing demand from jewelry makers and consumer products manufacturers as the global economy recovers.
Copper prices, meanwhile, have improved as China and other developing countries invest in infrastructure and construction.
For the quarter that ended March 31, Barrick said it earned $758 million, or 76 cents per share, compared with earnings of $371 million, or 42 cents per share, in the year-earlier period.
Excluding one-time items, Barrick said net income was $741 million, or 75 cents per share.
Barrick's revenue jumped 44 percent to $2.56 billion as it sold gold for an average price of $1,114 an ounce, compared with $915 an ounce a year ago. Copper prices rose to $3.29 a pound from $2.93 a pound.
Last fall, Barrick eliminated hedges, which are contracts to sell gold in the future at a fixed price.
Gold production increased 19 percent to 2.08 million pounds while copper production rose 5 percent to 100 million pounds.
Its total cash costs fell to $442 an ounce from $484 an ounce for gold and to $1.05 a pound from $1.32 a pound for copper production.
"We had a good start to the year with our operations performing well, and when combined with higher metal prices, the result was record earnings and operating cash flow for the quarter," Aaron Regent, president and CEO, said in a statement.
The results beat estimates from analysts polled by Thomson Reuters who had predicted earnings of 62 cents per share on revenue of $2.4 billion.
Barrick affirmed its full-year forecast of gold production in a range between 7.6 million and 8 million ounces at total cash costs of $425 an ounce to $455 an ounce.
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