Slide 1: Fourth Quarter 2014 Results and 2015 Outlook
Fourth Quarter 2014 Results and 2015 Outlook Conference Call / Webcast | February 19, 2015 1
Slide 2: Cautionary Statement on Forward-Looking Information
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION Certain information contained or incorporated by reference in this presentation, including any information as to our strategy, projects, plans or future financial or operating performance, constitutes "forward-looking statements”. All statements, o
Slide 3: Fourth Quarter 2014 Results
Fourth Quarter 2014 Results John L. Thornton Kelvin Dushnisky Jim Gowans Shaun Usmar Chairman of the Board Co-President Co-President Senior Executive Vice President and CFO 3
Slide 4: Agenda
Agenda Message from the Chairman 2014 Highlights Three-Year Outlook Restoring a Strong Balance Sheet Best Assets and Regions Growth in the Americas Reserves, Resources and Exploration Conclusions Questions 4
Slide 5: Message from the Chairman
Message from the Chairman BACK TO THE FUTURE CAPITAL ALLOCATION TALENT MANAGEMENT 5
Slide 6: 2014 Highlights
2014 Highlights Maximizing Returned to a lean, decentralized operating model Free Cash Flow and Returns Innovation cash flow success - TCM technology accelerates Operational Excellence - best safety year; DJ Sustainability Index Mining Leader Restoring a Strong Maintained strong liquidity Ba
Slide 7: 2014 Another Strong Operating Year
2014 Another Strong Operating Year Beat 2014 cost guidance Q4 2014 – AISC of $864/oz1 Gold Prod. (Moz) 1.53 6.25 Capex at low end of guidance AISC ($/oz) 925 864 Copper Prod. (Mlb) 134 436 Net loss per share includes C1 Cash Costs1 ($/lb) 1.78 1.92 impairments mainly related Capex ($B) 0.6 2.2
Slide 8: Continued Focus on Cost Reductions
Continued Focus on Cost Reductions Barrick AISC (US$/oz) 2014 Peer AISC (US$/oz) 1,014 ~9801 15% Peer $116 915 Average 864 864 Barrick 2012 2013 2014 $500 $500 1. See final slide #2 8
Slide 9: Three-Year Production and Cost Outlook
Three-Year Production and Cost Outlook Gold Production (Moz) AISC below 2015 6.2 6.2-6.61 levels by 2017 6.0 through ongoing cost AISC AISC reduction efforts $864 $860- $8951 Production in excess 4.0 of 6 Moz in both 2016 and 2017 2.0 2014 2015 2015 0 1. See final slide #3 9
Slide 10: 2015 and Beyond
2015 and Beyond Maximizing New operating model = $70M est. G&A savings in 2016 Free Cash Flow Expect portfolio to deliver 10-15% ROIC and Returns Improving supply chain and maintenance Restoring Intend to reduce net debt by at least $3B in 2015 a Strong Balance Sheet Strong liquidity allow
Slide 11: Restoring a Strong Balance Sheet
Restoring a Strong Balance Sheet Barrick intends to reduce its net debt in Net 2015: Debt Maximizing free cash flow through: – A lean, decentralized operating model – Reducing G&A costs – More efficient capital spending – Focus on profitable growth intended Disciplined non-core asset sales reduc
Slide 12: Strong Liquidity
Strong Liquidity Modest debt repayment with less than $1.0B due by 2017 $2.7B in cash1 and $4.0B undrawn credit facility Scheduled Debt Repayments to 20182 Cash Position 2.0 $2.7B 1.5 $0.9B 1.0 0.5 $4.0B 0 Undrawn Credit Facility 2015 2016 2017 2018 1. See final slide #4 2. As of Dec. 31, 2014 1
Slide 13: Lean Decentralized Operating Model
Lean Decentralized Operating Model Head Office Headcount Barrick is returning to its roots with a small head office 260 Delegated more responsibility 46% and accountability to leaders reduction at the operational level to staff Minimal bureaucracy enables country and mine managers to 140 focus
Slide 14: New Operating Model = Lower G&A
New Operating Model = Lower G&A Annual Savings $30 million in savings G&A and Overhead1 ($M) expected in 2015 2015 2016 Projected to reach $70 million in annualized savings by 2016 Clarity and transparency in $30 reporting Eliminated all management layers between head office reduces and mine
Slide 15: Best Assets and Regions
Best Assets and Regions Pueblo Viejo Lagunas Norte Cortez Veladero Goldstrike 15 15
Slide 16: Cost Leader Among Peers
Cost Leader Among Peers 2014 1,100 Newmont1 1,000 Kinross AISC ($/oz) Goldcorp Newcrest 900 TOTAL lowest cost ounces 800 $716/oz2 lowest cost senior $864/oz2 5 CORE 700 2 3 MINES 4 5 6 7 Production (Moz) 1. Based on 2014 guidance 2. See final slide #2 16
Slide 17: Superior Reserve Grade
Superior Reserve Grade Grams per tonne1 2.01 BARRICK The average reserve grade of Barrick’s core mines 5 CORE is more than double the peer average MINES 1.37 BARRICK TOTAL 1.022 0.95 0.9 g/t PEER AVERAGE 0.76 0.66 NEWMONT GOLDCORP KINROSS NEWCREST 1. See final slide #6 2. Based on 2013 reserves 17
Slide 18: Improving Returns and Mine Life
Improving Returns and Mine Life Cortez Lower Zone is mostly oxide and higher grade; limits to be defined Potential to add to reserves below 3,800 ft. Goldstrike ~1 Moz of est. annual production 2015-20172 at AISC of <$900/oz Innovative, cyanide-free TCM process ramping up Satellite South A
Slide 19: Growth in the Americas
Growth in the Americas First Quarter Second Quarter Third Quarter Fourth Quarter Turquoise Goldrush Cortez Hills Ridge Project Lower 2nd Shaft at Cortez Zone (completed) Spring Valley 19
Slide 20: Turquoise Ridge - An Emerging Core Mine
Turquoise Ridge - An Emerging Core Mine Potential to almost double annual production to 500 koz1 at AISC of $625-$675/oz1 Payback of ~2.5 years2 Bring forward S N over 1 Moz Current Haulage Shaft Additional Shaft Option Permit expected in Q3 2015 Open 1. Annual average for the first full eig
Slide 21: Turquoise Ridge - Our Highest Reserve Grade
Turquoise Ridge - Our Highest Reserve Grade 16.9g/t2 2014 drilling added +400 koz Tur- to North Zone M&I resources quoise Ridge North Zone is higher grade than existing mine North Zone Highlights 71% of reserve tonnes 74% of LOM ounces 45% higher grade vs. South Ore body still open to th
Slide 22: Goldrush – 70% of Resource in M&I
Goldrush – 70% of Resource in M&I TARGETS Portal High-grade potential Cortez untested and open Hills Mine High-grade continuity being established Goldrush Deposit1 10.6 Moz M&I 4.9 Moz Inferred 0 miles 1 2 3 4 1. See final slide #5 22
Slide 23: Cortez High Grade Underground Expansion
Cortez High Grade Underground Expansion Limits of the Cortez Hills Open Pit Lower Zone have not yet Breccia been defined Zone Below 3,800 ft. Middle Zone Reserves is primarily 3800 ft. Resources oxide and higher Open ? Renegade Zone grade than current Open to UG mine Open ? the South PFS compl
Slide 24: Potential New Standalone Mine
Potential New Standalone Mine Spring Valley, Nevada 0 feet 1,000 2,000 75% owned heap leach JV project Scoping Pit Low expected capex 2014 Initial M&I resource of Resource Footprint 1.9 Moz1,2 and inferred resource of 0.8 Moz1,2 Mineralized Turquoise Ridge Material AREA ENLARGED Goldstrike Elk
Slide 25: Pascua-Lama Optimization Underway
Pascua-Lama Optimization Underway Ramp-Down Completed New management focused on: – Improving project economics – Updating construction plan 2015 expenditures expected to be $170-$190M: – $140-150M1 for care and maintenance including water management system costs; and – $30-$40M2 for other permit
Slide 26: Highest Grade Reserve Base of Peers
Highest Grade Reserve Base of Peers 2014 110 90 Newmont1 93Moz Reserves (Moz) Newcrest 70 Goldcorp 50 Kinross 30 0.6 0.7 0.8 0.9 1.0 1.1 1.2 1.3 1.4 1.5 Grade (g/t) 1. Newmont’s reserves as of December 31, 2013. 26
Slide 27: Exploration Focused in the Americas
Exploration Focused in the Americas ~85% focused on the Americas Lagunas Norte – Half directed to Nevada Pierina Other PERU Mine Project 15% South North Turquoise Ridge America AREA America ENLARGED Goldstrike 35% Elko 50% NEVADA Carlin Zaldivar Spring Valley Cortez Goldrush Cerro Casale Bald Moun
Slide 28: Maximizing Free Cash Flow and Returns
Maximizing Free Cash Flow and Returns 28
Slide 29: Footnotes
Footnotes 1. All-in sustaining costs per ounce (“AISC”), C1 cash costs per pound, adjusted net earnings per share (“EPS”), and free cash flow (“FCF”) are non-GAAP financial performance measures with no standardized definition under IFRS. See pages 81-91 of Barrick’s Fourth Quarter 2014 Report. 2. Se