Gold Peer Group Analysis Q1.26

Production and Cost Statistics

• Equivalent gold production continued its long-term decline, falling 8% quarter-on-quarter (q/q) and 3% year-on-year (y/y) to 6.5Moz in Q1.26 (p. 4, p. 6).
  • The decline was primarily driven by lower output from Newmont, Barrick, and B2Gold (p. 6).
  • Harmony recorded the strongest quarterly increase of 9% q/q, while Solidcore Resources achieved an 84% y/y increase (p. 6).
• Average production costs remained under pressure across the peer group (p. 4, p. 7, p. 8).
  • Average co-product cash costs rose to US$1,449/oz, up 10% q/q and 18% y/y, with Agnico Eagle reporting the lowest cost (US$1,178/oz) and Sibanye-Stillwater the highest (US$2,788/oz) (p. 7).
  • Average All-In Sustaining Costs (AISC) increased to US$1,910/oz, up 4% q/q and 16% y/y, driven by sustaining capital expenditure, labor, and energy inputs (p. 4, p. 8).
• Corporate and exploration expenses continued an upward trend since Q1.21 (p. 9).
  • Corporate costs rose to US$69/oz, while exploration expenses stood at US$73/oz, which is considered unsustainably low to maintain production levels (p. 9).
  • Shareholder cash costs rose to US$3,165/oz, yielding a record positive cash margin of US$1,638/oz, or 34% of the gold price (p. 12).

Producer Margins and Profitability

• Higher gold prices significantly boosted producer margins and earnings (p. 4, p. 17, p. 18).
  • The peer group received a weighted average gold price of US$4,803/oz, representing a 17% q/q and 67% y/y increase (p. 4, p. 17).
  • Estimated EBITDA increased by 11% q/q, with Newmont generating the highest EBITDA and Endeavour Mining recording the largest quarterly increase of 63% (p. 18).
  • The average estimated EBITDA less stay-in-business capex margin rose to 61%, well above the long-term median of 29% since 2009 (p. 19).
• Effective tax rates for the peer group have stabilized around 30% since early 2020, down from a historical average of around 40% post-2013 (p. 15).

Capital Expenditure Trends

• Total capital expenditure fell 18% q/q to US$4.0bn (US$608/oz) but rose 11% y/y (p. 22).
  • Unitised stay-in-business capex fell 15% q/q to US$312/oz, close to the estimated US$300/oz required to sustain production (p. 22).
  • Unitised project capex fell 7% q/q to US$260/oz, below the US$300/oz estimated requirement to compensate for reserve depletion (p. 22).
  • Barrick spent the most on unitised total capex at US$1,154/oz, while Endeavour Mining spent the least at US$445/oz (p. 23).

Cash Flow and Balance Sheet Strength

• Cash generation reached a record high, with cash flow after total capex rising 10% q/q to US$10.7bn (p. 4, p. 27).
  • All peer group companies generated positive after-tax cash flow, led by Newmont at US$3.1bn and Barrick at US$1.6bn (p. 27).
  • Dividends as a percentage of net operating cash flow fell to 14% from 21% in the prior quarter as operating cash flow outpaced dividend payments (p. 28).
• The peer group's collective balance sheet transitioned to a net cash position of around US$9bn (p. 4) or over US$9.6bn (p. 30).
  • Newmont and Agnico Eagle held the largest net cash positions at US$3.7bn and US$2.9bn, respectively (p. 31).
  • Sibanye-Stillwater held the highest net debt at over US$1.4bn, though it loosened its debt covenants in Q2.24 (p. 31, p. 33).
  • Share buybacks were widely utilized to boost shareholder returns, including a US$3.0bn buyback by Newmont since February 2024 and a completed US$1.0bn program by Barrick in 2025 (p. 34).

Investor Returns and Market Ratios

• Investor returns and valuations showed contrasting trends of strong performance but low market multiples (p. 4, p. 37, p. 42).
  • Weighted average Return on Capital and Return on Equity both rose to new highs since 2009 (p. 37).
  • The weighted average share price rose 6% q/q and 107% over the past 12 months, outperforming the gold price's 49% 12-month gain (p. 39).
  • Despite strong share performance, the Enterprise Value to EBITDA (EV/EBITDA) ratio decreased to 5.1, near its lowest level since 2009 (p. 4, p. 42).
  • The average free cash flow yield remained steady at 11.1%, significantly higher than the 14-year average of 6.8% (p. 44).
  • The weighted average equivalent gold reserve life remained steady at 21 years, with Barrick holding the largest reserves relative to production (p. 48).