Barrick Gold Corp. took a huge accounting charge because of falling gold prices and posted a net loss of $8.56 billion, although it said its operating results were strong.
It also slashed its next dividend to 5 cents per share, down from 20 cents per share in recent quarters.
Gold prices peaked above $1,800 per ounce in September 2011, bringing a surge of expansion in the mining business. Falling prices since then have forced the industry to retrench. On Thursday afternoon gold was trading at $1,313 an ounce.
Barrick said it is cutting 2013 costs by $2 billion. Most of its costs per ounce are "well below current spot levels, and for those operations that are not generating positive cash flow, we will change mine plans, suspend, close or divest them," said President and CEO Jamie Sokalsky.
The second-quarter loss worked out to $8.55 per share. A year earlier it reported a profit of $787 million, or 79 cents per share.
Excluding the $8.7 billion accounting charge, it would have earned $663 million, or 66 cents per share. Analysts surveyed by FactSet expected a profit of 58 cents per share.
Revenue fell 1.3 percent to $3.2 billion, which was higher than analysts expected.
Barrick kept its forecast for gold production unchanged at 7 million to 7.4 million ounces for the year. It raised the low end of its copper estimate to 500 million to 540 million pounds, up from an old estimate that started at 480 million pounds.
The new, lower dividend will be paid on Sept. 16 to shareholders of record on Aug. 30.
"We recognize the importance of dividends to our shareholders, and it is our goal to return more capital to investors in the future, but at this time, this is the prudent course of action," Sokalsky said.
Shares of Toronto-based Barrick Gold Corp. rose 6 cents to $17.03 in afternoon trading.
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