Gold mining investment outlook 2019:
US$3.9B increase in earnings for majors

As the gold price began to decline after hitting its peak in 2011, gold mining companies began shifting their focus to maximizing value over volume, with greater emphasis on delivering returns to stakeholders than on increasing production. Recent M&A deals tie into this theme as companies look to unlock synergistic cost savings through lower average costs and increased value. This shift has seen gold production remain relatively constant among the top 30 gold mining equities between 2014 and 2018, at about 43 million ounces per year, with a 3% increase expected in 2019. The consensus earnings margin outlook of 30% for gold mining equities is supported by our view on 2019 all-in sustaining cost, or AISC, margins at 33%.