CORRECTED-(OFFICIAL)-UPDATE 2-Barrick cuts cost forecast, appoints directors

Wed Jul 30, 2014 7:33pm EDT

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(Corrects job title of Brian Greenspun in paragraph 2 to chairman and chief executive of Greenspun Media Group following correction from Barrick)

July 30 (Reuters) - Barrick Gold Corp lowered its full-year cost forecast on Wednesday and again trimmed capital spending as the world's biggest gold producer works to rein in costs that soared industry-wide between 2008 and 2012, when bullion was rising.

Barrick also said it appointed J. Michael Evans, the former vice-chairman of Goldman Sachs Inc, and Brian Greenspun, the chairman and chief executive of Greenspun Media Group and a prominent Nevada businessman, as independent directors on its board.

Toronto-based Barrick this month said it would abolish its chief executive position, replacing it with two presidents in a move investors and analysts said cements the authority of its new executive chairman, John Thornton, a former Goldman Sachs executive.

Barrick earlier reported slightly weaker-than-expected adjusted net earnings, which fell to $159 million, or 14 cents a share, in the quarter to end-June from $663 million, or 66 cents a share, in the same period a year ago.

Analysts expected the company to earn 15.9 cents a share, according to Thomson Reuters I/B/E/S.

Earnings were down on weaker gold prices and lower gold and copper sales volumes. Results also were reduced by an impairment charge of $514 million related to the Jabal Sayid copper project. Barrick this month said it was forming a joint venture with Saudi Arabian Mining Co (Ma'aden) to run the long-delayed project.

Barrick, which has mines in the Americas, Australia and Africa, said it was reducing its forecast for 2014 all-in sustaining costs, the industry cost benchmark, to between $900 and $940 per ounce from a previous forecast of between $920 and $980 an ounce.

The company also cut its 2014 capital expenditure guidance range by $200 million, to between $2.2 billion and $2.5 billion.

Barrick and its peers have beaten the cost-cutting drum for at least a year as the industry tries to restore profits hard hit in recent years by soaring mine site costs, over-priced acquisitions and a 28 percent fall in the bullion price last year.

Barrick produced 1.49 million ounces of gold in the second quarter, down from 1.81 million ounces a year earlier. The miner has sold several higher-cost mines over the past year. It kept unchanged its full-year gold production forecast.

All-in sustaining costs fell to $865 an ounce from $910 an ounce in the same period a year ago.

Copper production in the second quarter was 67 million pounds, well down from 134 million pounds in the same quarter last year, reflecting a partial collapse of the main conveyor at its Lumwana mine in Zambia. Barrick said the conveyor had been repaired and normal plant operations resumed this month.

Copper cash costs rose to $2.04 per pound in the quarter from $1.75 a pound in the second quarter of 2013.

The company did not change its full-year copper production or cost forecasts. (Reporting by Nicole Mordant in Vancouver; Editing by David Gregorio, Leslie Adler, Dan Grebler and Diane Craft)

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