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PDAC 2012: Competitors not delivering value, says Randgold CEO

By · March 7, 2012 · 10:17 am · Leave a Comment


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By Peter Koven

There is no question that gold equities have badly underperformed the gold price in recent years. To Mark Bristow, the chief executive of African miner Randgold Resources Ltd., a big part of the problem with miners is that they are growing production by just expanding capacity rather than making new discoveries. The result is higher costs and lower grades.

“The impact on your costs is extremely severe,” he said in a colourful breakfast presentation.

Randgold has definitely outperformed its peers, and Mr. Bristow is certain he knows why: “We believe the only way to create value in the mining industry is to discover and develop our own deposits,” he said.

The company’s one big acquisition in recent years was the Kibali project in the Democratic Republic of Congo, a joint venture with AngloGold Ashanti Ltd. The project is expected to pour gold at the end of next year.

Mr. Bristow noted that analysts have always called the company “expensive”, but he believes the premium is justified based on its past performance.

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