Invest1 publisher3 min readPublished
Barrick puts $3 billion behind a buyback after free cash flow rose 195%
The miner reported $1.21 billion of attributable free cash flow for the first quarter, beat its own production guidance by 39,000 ounces, and said the North American Barrick IPO is on track to complete by year end.
The Investor · Invest desk
What happened
- Barrick produced 719,000 ounces of gold in the first quarter of 2026, above its guidance range of 640,000 to 680,000 ounces, with copper output of 49,000 tonnes in line with plan.
- Net earnings were $1.60 billion against $474 million in the prior-year quarter, with adjusted net earnings of $1.65 billion against $603 million.
- The company announced a new $3.0 billion share buyback program and declared a quarterly dividend of $0.175 per share.
- Barrick said the North American Barrick IPO is progressing as planned and is targeted for completion by year end, with full-year production and cost guidance unchanged.
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Why it matters
- decision At Q1 cash generation, the buyback and a year of dividends together take about 86% of annualized attributable free cash flow, so the board has chosen distributions over an equivalent build of new capacity.
- cost The $178 per ounce narrowing between AISC and cash costs is worth roughly $128 million in the quarter, and if it is deferral rather than a permanent saving, the spend lands later in the year.
- constraint Nearly a quarter of consolidated operating cash flow, about $580 million, accrues outside Barrick, so the consolidated headline overstates what is available to fund repurchases.
Net earnings of $1.60 billion at $0.96 a share put the share count near 1.67 billion [8][9][17], so the $0.175 quarterly dividend [12] costs about $292 million a quarter [18], roughly 24% of the quarter's attributable free cash flow [19]. The $3.0 billion authorization is worth 2.48 quarters of that free cash flow [20]. Annualize the first quarter at $4.84 billion [21], add four dividends at about $1.17 billion [22], and buyback plus dividends comes to 86% of it [23]. Hill said "Our growth pipeline advanced, with good progress at Lumwana and Fourmile." [15] A repurchase of that size competes with those projects for the same cash.
The cost lines moved in opposite directions. Gold cost of sales rose to $1,922 an ounce from $1,629 [4], up 18% [24], and total cash costs rose 8.8% to $1,327 [5][25]. All-in sustaining costs fell 4% to $1,708 [6], so the year-ago figure was about $1,779 [26]. Take cash costs out of AISC and the remainder, which is sustaining capital and the other add-ons, went from $559 an ounce to $381, down 32% [27]. Across 719,000 ounces that is roughly $128 million of per-ounce spend not incurred [28]. Barrick put the year-on-year increases down to higher royalties, a less favorable production mix and inflation, and said costs still came in below plan [11].
Attributable and consolidated figures differ by more than rounding here. Of $2.55 billion in consolidated operating cash flow [7], $1.97 billion was attributable [16], or 77%, leaving about $580 million with partners [29]. Between attributable operating cash flow and the $1.21 billion of attributable free cash flow sits $760 million of capital and other outflows [30]. The 195% increase implies about $410 million in the prior-year quarter [31]. Barrick did not disclose the realized gold price for the quarter [14].
Mark Hill, president and chief executive, said the year's focus is to "continue to improve safety performance, deliver on production and cost guidance, advance our growth projects on time and on budget, and execute the North American Barrick IPO to unlock further shareholder value." [13] Second-quarter guidance of 730,000 to 770,000 ounces [10] has a midpoint 4.3% above the first quarter [32]. Copper was 49,000 tonnes, 11% above a year ago [3].
In my view the cash is underwritten by price more than by volume: the production beat was 39,000 ounces over the top of guidance, 5.7% [33], while net earnings per share rose 256% [8]. The counter-case is in the cost lines. With cost of sales at $1,922 an ounce, a retreat in the gold price at flat production takes free cash flow down faster than it came up. A third path is that $381 an ounce of non-cash-cost AISC: if the narrowing is timing, sustaining spend returns in later quarters against unchanged full-year cost guidance [34], and the 86% payout share tightens.
What to watch
- The pace of the $3.0 billion repurchase, since Barrick did not give a period for the program and quarterly disclosure will show whether it runs at 2.5 quarters of free cash flow or slower.
- Whether the North American Barrick IPO closes inside the year-end target, and what the float does to attributable cash flow in later quarters.
- Whether the $381 an ounce of non-cash-cost AISC holds, or sustaining capital returns against unchanged full-year cost guidance.