Letter from the Executive Chairman
March 29, 2019
Dear Fellow Shareholders,
On behalf of the Board of Directors, I have the pleasure of inviting you to our Annual Meeting of Shareholders.
Over the past four years, everything we have done has been focused on laying the groundwork for a transformation of the business to secure profitable long-term growth. Our results for 2018 show that while more remains to be done, we have made substantial progress towards this goal.
Barrick met its production guidance for the year, with zero fatalities and a reduction in our injury and environmental incident rates – a significant achievement in a business of this size, in an industry where recent events have again highlighted the critical importance of effective safety and environmental risk management. The annual dividend was increased by 33% on the back of strong cash flows and total debt reduction, leaving Barrick with a healthy balance sheet at the year-end.
The completion of our nil-premium merger with Randgold on January 1, 2019 marked a major advance towards our strategic goals. It has strengthened Barrick’s position of leadership in the senior gold peer group in every aspect of its business, accelerated the pace and effectiveness of change, and brought to Barrick a chief executive officer and a team with the best record of value creation, operational excellence and disciplined execution in the industry.
Barrick’s new President and Chief Executive Officer, Mark Bristow has moved quickly to select and integrate the corporate and operational management teams, and to align them with our new vision of becoming the world’s most valued gold business. We have renewed our commitment to a culture of partnership and ownership, defined our strategic investment filters, and agreed on the strategic initiatives that require immediate attention. These have already been launched and we look forward to reporting to you regularly on their development. We trust that by the end of the current year, we will be able to show that the merger has delivered on all that we promised, and we thank you for your continuing support.
Following the merger between Barrick and Randgold, Barrick’s Board was reconstituted and streamlined with nine directors, six of whom were appointed by Barrick and three by Randgold. The Barrick nominees were María Ignacia Benítez, Gustavo A. Cisneros, J. Michael Evans, Brian L. Greenspun, J. Brett Harvey (Lead Director) and me. The Randgold nominees were Mark Bristow, Christopher L. Coleman and Andrew J Quinn. Very tragically, in late February María Ignacia Benítez passed away after a struggle with cancer. María joined Barrick’s Board of Directors in April 2018, and quickly became a trusted advisor and cherished friend to the Company. We will all greatly miss her sage counsel, her leadership, and equally, her deep sense of kindness and decency.
Also following the merger, the Board reconstituted its committees into three standing committees. These are Audit & Risk, chaired by J. Brett Harvey, Compensation, chaired by Christopher L. Coleman, and Corporate Governance & Nominating, chaired by Gustavo A. Cisneros.
The new Board nominees include international business leaders and mining industry professionals, and bring together a wide range of skills, experience and perspectives. It also has the expertise and institutional knowledge necessary to ensure a seamless integration of the Randgold operations into Barrick. Its composition is in line with our strategy of regularly strengthening and refreshing the Board, ensuring that it is equipped to address effectively the changes, opportunities and risks in our business.
Building on the clear success of our merger with Randgold, in March 2019 we announced an agreement with Newmont Mining Corporation to create a joint venture combining our respective mining operations, assets, reserves, and talent in Nevada. Ownership of the joint venture will be 61.5% Barrick and 38.5% Newmont, with Barrick as the operator. This agreement represents an historic accord between our companies that will allow us to unlock the enormous geological potential of the Nevada goldfields, something that has been attempted many times over more than two decades and which is a tribute to the new management team.
We invite you to review our information circular which details how to attend the Annual Meeting on May 7, 2019, how to vote and how to contact me, my fellow directors and the Company.
We thank you for your support and look forward to your participation in the Meeting.
John L. Thornton