Large producers' Q3 earnings expected to soar alongside gold prices

Analysts expect most major gold producers to report higher earnings in the third quarter than a year ago as gold prices rise to new records, an analysis of S&P Global Market Intelligence data shows.

Eight of the 10 largest gold producers by market capitalization are expected to report higher third-quarter earnings year over year and one producer, B2Gold Corp., is expected to record flat earnings, according to an analysis of S&P Capital IQ consensus estimates covering the largest metals and mining companies that produced over 500,000 ounces of gold in 2023.

Prevailing economic and geopolitical uncertainty and forecasts for lower interest rates from the US Federal Reserve continue to push up the price of gold. The London Bullion Market Association gold price set new records throughout the third quarter, a trend that continued into the current quarter, with a new high set at $2,670.88 on Oct. 16.

The precious metal is forecast to average $2,612.50/oz in 2025, according to S&P Global Commodity Insights' Commodity Briefing Service published Sept. 20.

The two largest gold producers in the analysis are both on track to double their prior-year EPS. Analysts expect Newmont Corp. to report earnings of 82 cents per share, up 127.8% from the year-ago EPS of 36 cents. Agnico Eagle Mines Ltd. is expected to report EPS of 98 cents, up 122.7% from 44 cents in the prior-year period.

Barrick Gold Corp. will also likely see substantial gains in the September quarter with a consensus EPS estimate of 34 cents, up 41.7% compared with 24 cents a year ago. The company sold 967,000 ounces of gold, in line with the previous quarter, according to its preliminary results released Oct. 16. The company also said it expects a "materially stronger" fourth quarter.

SSR Mining Inc. is the only top gold producer in the analysis that is expected to report lower earnings year over year: The consensus estimate for its third-quarter earnings per share is 16 cents, down 38.5% from 26 cents.

In February, SSR Mining temporarily suspended its Copler gold mine in Turkey due to a landslide. The company said in a July 31 update that it was not certain when operations would continue at the site.

Gold should continue to perform well over the longer term due to the ongoing debasement of the US dollar, precarious financial conditions in Western nations and the hunt for a safe-haven investment vehicle, Ryan McIntyre, managing partner at Sprott Asset Management, told Commodity Insights.

"This bodes well for significant margin expansion and profitability for gold mining companies," McIntyre said. "If the current gold price remains stable, we anticipate further margin expansion in the fourth quarter."

Analysts at Scotiabank Global Equity Research said in an Oct. 16 note that higher gold prices should translate to margin expansion of approximately 12% on average across the gold producers it covers.