African Barrick Gold Plc (ABG), the gold producer that has slumped 73 percent since it listed in London, said Greg Hawkins quit as chief executive officer with immediate effect.
Hawkins will be replaced by Bradley A. Gordon, the London-based company said in a statement today. Gordon has 30 years of gold-mining experience and will join the board as an executive director.
African Barrick has been dogged by operational setbacks since it was spun off from Toronto-based Barrick Gold Corp. (ABX) in 2010, and has struggled to meet production targets. The company is reviewing its operations to cut costs that have ballooned by 71 percent since 2010.
“Bradley steps into a challenging position within a company with significant structural issues,” Liberum Capital Ltd. said in a note to investors. “The real test will be whether or not Bradley can deliver the operational cost savings which Greg started.”
When African Barrick listed in London the company said it was targeting annual production of 1 million ounces in 2014. Instead, it has posted output declines for three consecutive years and has been surpassed by rivals Randgold Resources Ltd. (RRS) and Petropavlovsk Plc. (POG)
African Barrick slipped 0.4 percent to 155.3 pence by the close in London trading. The stock started trading at 575 pence in March 2010.
In July, it wrote down the value of its mines by $727 million as it reported a first-half net loss of $701.2 million, compared with a year-earlier profit of $73.7 million.
Gordon, who will relocate to London from Australia, was previously CEO of Intrepid Mines Ltd. (IAU), which operates in Indonesia, African Barrick said. Before that, he was CEO of Emperor Mines Ltd. and worked for Placer Dome Inc.
Barrick Gold, the world’s biggest producer, sought to sell its 74 percent stake in African Barrick last year to China National Gold Group Corp. before talks broke down in January.
“Brad has a proven ability to deliver the maximum potential from the operations he has managed, from reducing costs and increasing production to achieving operational efficiencies and extending mine lives,” African Barrick said.
There are no other matters requiring disclosure, the company said.
To contact the reporter on this story: Thomas Biesheuvel in London at firstname.lastname@example.org