Agnico Eagle Reports Second Quarter 2016 Operating and Financial Results; Operations Continue to Deliver Strong Performance; Positive Guidance Revision; Further Reduction in Net Debt; And Dividend Increased by 25%
For the first six months of 2016, the Company reported net income of
Second quarter 2016 cash provided by operating activities was
For the first six months of 2016, cash provided by operating activities was
The increase in cash provided by operating activities before changes in working capital during the second quarter 2016 and first six months of 2016 was mainly due to a combination of higher gold and by-product metals production, as described above.
"The second quarter saw continued strong operating results from all of our mines coupled with record safety performance", said
Sean Boyd, Agnico Eagle's Chief Executive Officer. "Given these strong results and a more robust gold price environment, we have significantly improved our financial position, while continuing to make important investments in several of our growth projects. In addition, we have raised our dividend signaling our confidence in our business and growth plan", added Mr. Boyd.
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Adjusted net income is a Non-GAAP measure. For a discussion regarding the Company's use of non-GAAP measures, please see "Note Regarding Certain Measures of Performance". |
Second Quarter 2016 highlights include:
- Quarterly gold production – Payable gold production2 in the second quarter of 2016 was 408,932 ounces of gold at total cash costs3 per ounce on a by-product basis of
\\$592 and all-in sustaining costs4 ("AISC") on a by-product basis of\\$848 per ounce - 2016 production guidance increased and cost forecasts reduced – Expected gold production for 2016 is now forecast to be approximately 1.58 to 1.6 million ounces (previously 1.565 million ounces) with total cash costs per ounce on a by-product basis of
\\$580 to \\$620 (previously\\$590 to \\$630 ) and AISC of approximately\\$840 to \\$880 per ounce (previously\\$850 to \\$890 ) - Investment grade balance sheet further enhanced – In the second quarter of 2016, the outstanding balance of
\\$210 million was repaid under the Company's credit facility, andC\\$20 million (reflecting the Company's 50% interest) was repaid under the Canadian Malartic General Partnership's (the "Partnership") secured loan facility. Net debt was reduced by approximately\\$181 million , to\\$742 million , atJune 30 , 2016. For the seventh consecutive quarter, the Company has reduced net debt. The Company's investment grade credit was re-confirmed byDominion Bond Rating Service Ltd. ("DBRS") with a stable trend - Quarterly dividend increased by 25% - The Company has declared a
\\$0.10 quarterly dividend. The previous quarterly dividend was\\$0.08 - Final permit received at the Meliadine Gold project - In
May 2016 , the Company received the Type A Water License, which is the final license necessary to commence construction activities
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Payable production of a mineral means the quantity of mineral produced during a period contained in products that are sold by the Company whether such products are shipped during the period or held as inventory at the end of the period. |
3 |
Total cash costs per ounce is a Non-GAAP measure. For a reconciliation to production costs, see "Reconciliation of Non-GAAP Financial Performance Measures" below. Total cash costs per ounce of gold produced is presented on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the consolidated statements of income (loss) for by-product revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. See also "Note Regarding Certain Measures of Performance". For information about the Company's total cash costs per ounce on a co-product basis please see "Reconciliation of Non-GAAP Performance Measures". |
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All-in-sustaining costs per ounce is a Non-GAAP measure and is used to show the full cost of gold production from current operations. For a reconciliation to production costs, see "Reconciliation of Non-GAAP Financial Performance Measures" below. The Company calculates all-in sustaining costs per ounce of gold produced as the aggregate of total cash costs per ounce on a by-product basis, sustaining capital expenditures (including capitalized exploration), general and administrative expenses (including stock option expense) and reclamation expenses divided by the number of ounces of gold produced. All-in sustaining costs per ounce of gold produced on a co-product basis is calculated in the same manner as all-in sustaining costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. For information about the Company's AISC on a co-product basis please see "Reconciliation of Non-GAAP Performance Measures". The Company's methodology for calculating all-in sustaining costs per ounce may not be similar to the methodology used by other producers that disclose all-in sustaining costs per ounce. See also "Note Regarding Certain Measures of Performance". The Company may change the methodology it uses to calculate all-in sustaining costs per ounce in the future, including in response to the adoption of formal industry guidance regarding this measure by the World Gold Council. |
Second Quarter Financial and Production Highlights – Higher Gold Production, Lower Unit Costs
In the second quarter of 2016, strong operational performance continued at the Company's mines.
Payable gold production in the second quarter of 2016 was 408,932 ounces compared to 403,678 ounces in the second quarter of 2015. The higher level of production in the 2016 period was primarily due to higher grades at LaRonde, increased throughput levels and higher grades at Goldex and increased throughput levels at Canadian Malartic. A detailed description of the production and cost performance of each mine is set out below.
Total cash costs per ounce on a by-product basis for the second quarter of 2016 were lower at
Payable gold production for the first half of 2016 was 820,268 ounces, compared to payable gold production of 807,888 ounces in the comparable 2015 period.
For the first half of 2016, total cash costs per ounce on a by-product basis were
AISC on a by-product basis for the second quarter of 2016 were lower at
For the first half of 2016, AISC on a by-product basis were
Cash Position Remains Strong; Net Debt Reduced for Seventh Consecutive Quarter
Cash and cash equivalents and short term investments increased to
The outstanding balance on the Company's
In order to take advantage of historically low interest rates and improve term and liquidity, on
Total capital expenditures (including sustaining capital) made by the Company in the second quarter of 2016 were
Total capital expenditures (including sustaining capital) for the first six months of 2016 were
Total sustaining capital expenditures made by the Company in the second quarter of 2016 were
Total sustaining capital expenditures for the first six months of 2016 were
Total capital expenditures (including sustaining capital) in 2016 remain forecast at
Revised 2016 Guidance – Production Increased, Costs Lowered, Depreciation Decreased
Production for 2016 is now forecast to be approximately 1.58 to 1.6 million ounces of gold (previously 1.565 million ounces) with total cash costs per ounce on a by-product basis of
The Company expects depreciation and amortization expense to be in the range of
Second Quarter 2016 Results Conference Call and Webcast Tomorrow
The Company's senior management will host a conference call on
Via Webcast:
A live audio webcast of the conference call will be available on the Company's website www.agnicoeagle.com.
Via Telephone:
For those preferring to listen by telephone, please dial 1-647-427-7450 or toll-free
1-888-231-8191. To ensure your participation, please call approximately ten minutes prior to the scheduled start of the call.
Replay Archive:
Please dial 1-416-849-0833 or toll-free 1-855-859-2056, access code 38813014. The conference call replay will expire on
The webcast, along with presentation slides, will be archived for 180 days on www.agnicoeagle.com.
NORTHERN BUSINESS OPERATING REVIEW
ABITIBI REGION,
Agnico Eagle is currently
The 100% owned LaRonde mine in northwestern
The LaRonde mill processed an average of 6,241 tonnes per day ("tpd") in the second quarter of 2016, compared with an average of 6,242 tpd in the corresponding period of 2015. Minesite costs per tonne5 were approximately
For the first six months of 2016, the LaRonde mill processed an average of 6,295 tpd, compared to 6,223 tpd in the first six months of 2015. Minesite costs per tonne were approximately
LaRonde's total cash costs per ounce on a by-product basis were
In the first six months of 2016, LaRonde produced 150,496 ounces of gold at total cash costs per ounce on a by-product basis of
Studies are continuing to assess the potential to extend the mineral reserve base and carry out mining activities between the 311 and 371 levels at LaRonde. At present, the mineral reserve base extends to the 311 level, which is 3.1 kilometres below the surface. An infill drill program is continuing from the 311 to the 371 levels with a focus on the western portion of the deposit. Infill drilling will also be carried out on the eastern portion of the deposit as underground development extends into that area.
In the second quarter of 2016, site preparation activities continued at Bousquet Zone 5 on the Company's adjoining Bousquet property. Previous property owners had partly exploited Bousquet Zone 5 using open pit and underground operations. The Company is evaluating the potential to mine Bousquet Zone 5 using underground ramp access. The mining method is likely to be similar to that employed at Goldex and processing could utilize excess capacity from the Lapa circuit at LaRonde.
During the quarter, dewatering of the old pit was completed along with rehabilitation of the ramp portal and 92 metres of underground development was completed. A certificate of authorization was issued by the
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Minesite costs per tonne is a non-GAAP measure. For a reconciliation of this measure to production costs as reported in the financial statements, see "Reconciliation of Non-GAAP Financial Performance Measures" below. See also "Note Regarding Certain Measures of Performance". |
In
During the second quarter of 2016, the Canadian Malartic mill (on a 100% basis) processed an average of 55,481 tpd, compared with an average of 50,705 tpd in the corresponding period of 2015. The record daily throughput in the 2016 period was primarily due to higher crusher availability, better crushing performance from the secondary crusher and better plant availability.
Minesite costs per tonne in the second quarter of 2016 were approximately
For the first six months of 2016, the Canadian Malartic mill processed an average of 53,897 tpd, compared with an average of 51,343 tpd in the corresponding period of 2015. Minesite costs per tonne were approximately
For the second quarter of 2016, Agnico Eagle's 50% share of production at the Canadian Malartic mine was 72,502 ounces of gold at total cash costs per ounce on a by-product basis of
In the first six months of 2016, Agnico Eagle's 50% share of production at the Canadian Malartic mine was 146,115 ounces of gold at total cash costs per ounce on a by-product basis of
Permitting activities for the Canadian Malartic pit extension and deviation of
The Quebec Bureau des Audiences Publiques sur l'
The Odyssey prospect lies on the east side of the Canadian Malartic property, approximately 1.5 kilometres east of the current limit of the Canadian Malartic open pit. In the second quarter of 2016, drilling was ongoing at Odyssey and a total of 57 holes (53,417 metres) were completed through
The Odyssey prospect is composed of multiple mineralized bodies spatially associated with a porphyritic intrusion close to the contact of the
Recent drilling has yielded significant intercepts such as 2.63 grams per tonne ("g/t") gold (capped) over 33.5 metres estimated true width at 1,171 metres depth in drill hole ODY16-5039, showing similarities to the Goldex mine deposit. Additional details on the 2016 Odyssey drill program are reported in the Company's exploration news release of
Lapa – Potential for Increased Production through Year End 2016
The 100% owned Lapa mine in northwestern
The Lapa circuit, located at the LaRonde mill, processed an average of 1,771 tpd in the second quarter of 2016. This compares with an average of 1,387 tpd in the second quarter of 2015. Throughput in the 2015 period was lower because of downtime related to the discovery of fatigue cracks in the feed head of the Lapa ball mill.
Minesite costs per tonne were
For the first six months of 2016, the Lapa mill processed an average of 1,767 tpd, compared to 1,538 tpd in the first six months of 2015. Minesite costs per tonne were approximately
Payable production in the second quarter of 2016 was 21,914 ounces of gold at total cash costs per ounce on a by-product basis of
In the first six months of 2016, Lapa produced 43,623 ounces of gold at total cash costs per ounce on a by-product basis of
At Lapa, 2016 is the last full year of production based on the current life of mine plan. Production was expected to show a gradual decline moving into the fourth quarter of this year with the full year expected to total 60,000 ounces of gold, as per
Goldex – Strong Underground Performance and Higher Grades Drive Increased Production and Lower Costs
The 100% owned Goldex mine in northwestern
The Goldex mill processed an average of 7,233 tpd in the second quarter of 2016. This compares with an average of 6,640 tpd in the second quarter of 2015. The higher throughput in the 2016 period was due to better underground hoisting performance and acceleration of the mining sequence compared to the 2015 period.
Minesite costs per tonne were approximately
For the first six months of 2016, the Goldex mill processed an average of 7,112 tpd, compared to 6,468 tpd in the first six months of 2015. Minesite costs per tonne were approximately
Payable gold production in the second quarter of 2016 was 31,452 ounces of gold at total cash costs per ounce on a by-product basis of
In the first six months of 2016, Goldex produced 63,792 ounces of gold at total cash costs per ounce on a by-product basis of
Development of the Deep 1 Zone remains on time and on budget for startup in the first quarter of 2018. In the second quarter of 2016, the excavation of the second leg of the Rail-Veyor (conveyor system) ramp was completed and the initial components of the Rail-Veyor are now being installed.
In
Permitting of the Akasaba project is progressing at both the provincial and federal levels. At the provincial level, following submission of the Environmental Impact Assessment (EIA) in
At the federal level, following submission of the EIA in
In
These claims, which are collectively referred to as Joubi, consist of three properties including the Joubi and Dubuisson Ouest properties and a portion of the Mine Ecole property. These properties cover the lateral and downdip extensions of the Goldex orebody. There are no mineral resources outlined on those properties.
The transaction includes surface rights, infrastructure and certain equipment from the historical
FINLAND AND SWEDEN
Agnico Eagle's Kittila mine in
Kittila –
The 100% owned Kittila mine in northern
The Kittila mill processed an average of 4,274 tpd in the second quarter of 2016 compared to 4,170 tpd in the second quarter of 2015. The higher throughput in the 2016 period is a result of increased development leading to improved ore access and strong mining productivity.
Minesite costs per tonne at Kittila were approximately €81 in the second quarter of 2016, compared to €75 in the second quarter of 2015. Costs increased in the second quarter of 2016 due to higher than expected maintenance costs associated with the scheduled mill shutdown and increased contractor costs compared with the 2015 period. These costs more than offset the benefit of the increased throughput.
For the first six months of 2016, the Kittila mill processed an average of 4,512 tpd, compared to 4,004 tpd in the first six months of 2015. Minesite costs per tonne were approximately €76 in the first six months of 2016, the same as in the comparable 2015 period as higher throughput was offset by higher operating costs, as described above.
Second quarter 2016 payable gold production at Kittila was 46,209 ounces with total cash costs per ounce on a by-product basis of
In the first six months of 2016, Kittila produced 94,336 ounces of gold at total cash costs per ounce on a by-product basis of
The Kittila mine and mill have shown the ability to operate in excess of 4,000 tpd and efforts are ongoing to assess the optimal throughput rate. Studies are also underway to optimize underground mining rates and fully integrate the upper and lower Rimpi zones and the newly discovered Sisar Zone in a new Kittila mine plan. Unit costs are expected to improve once steady state operations are achieved.
Drilling is ongoing to infill and extend the mineralization in the Sisar Zone. In addition, underground ramp construction began in March to access the upper portion of the Sisar Zone, which is located approximately 150 to 200 metres from existing underground infrastructure. During the second quarter of 2016, assay results were received from a number of drill holes. Significant results include: drill hole ROD16-700D that intersected 7.4 g/t gold (uncapped) over 9.6 metres estimated true width at 1,161 metres depth, and hole ROD16-700B that intersected 6.4 g/t gold (uncapped) over 6.5 metres estimated true width at 1,261 metres depth. Additional details on these holes are set out in the Company's exploration news release of
In
Recent drilling at the Skir?sen Zone has extended the mineralization at depth and to the southeast. Highlights include hole SKI16-006 grading 1.31 g/t gold (capped) over an estimated true width of 69.8 metres at 445 metres depth. This drill intercept is located roughly 850 metres southeast of the core of the Central Zone indicating that the current known mineralization could be part of a larger mineralized system. Additional details on these holes are set out in the Company's exploration news release of
Agnico Eagle has identified
Meadowbank – Good Cost Performance Despite Lower Production Volumes in the Second Quarter of 2016
The 100% owned Meadowbank mine in
The Meadowbank mill processed an average of 10,918 tpd in the second quarter of 2016, compared to the 11,199 tpd achieved in the second quarter of 2015. Year-over-year, mill throughput levels were lower primarily due to harder ore being processed from the Vault pit.
Minesite costs per tonne were approximately
For the first six months of 2016, the Meadowbank mill processed an average of 10,654 tpd, compared to 11,103 tpd in the first six months of 2015. Minesite costs per tonne were approximately
Payable production in the second quarter of 2016 was 72,402 ounces of gold at total cash costs per ounce on a by-product basis of
In the first six months of 2016, Meadowbank produced 144,713 ounces of gold at total cash costs per ounce on a by-product basis of
Studies are ongoing to investigate additional opportunities to extend production at Meadowbank through year-end 2018. Potential opportunities include the development of the Phaser pit, which is located to the southwest of the Vault pit, and an additional pushback to access additional ore in the E3 pit at the Portage deposit.
Agnico Eagle has a 100% interest in the Amaruq project in
During the quarter, exploration drilling continued at Amaruq. The goals of the 2016 exploration program were to infill and expand the known mineral resource areas and to test other favourable targets with a focus on identifying a second source of open pit ore.
Drilling began at the end of January and continued through May based mainly on lake ice; the drilling since June has been land-based supported by helicopters. Exploration and conversion drilling to the end of June has totalled 77,517 metres (338 holes), using up to nine rigs, completing the initial 75,000-metre drill program. Almost half of this drilling was in the IVR deposit (36,545 metres, 152 holes), with 30% at Whale Tail (24,820 metres, 103 holes) and the rest at Mammoth (16,153 metres, 83 holes). In addition, there was 2,186 metres (nine holes) related to engineering studies (rock mechanics / geotechnical drilling and metallurgical testing) in this period.
Exploration drilling has encountered a new vein structure in the V Zones, with results up to 15.5 g/t gold (capped) over 9.4 metres estimated true width at 18 metres depth in drill hole AMQ16-706. The V Zones have been shown to include multiple parallel structures. A recent lower intercept was 15.5 g/t gold (capped) over 5.4 metres estimated true width at 349 metres depth in drill hole AMQ16-833. The V Zones are being evaluated as a potential second source of open pit ore for Amaruq. Additional details from the 2016 Amaruq program are set out in the Company's exploration news release of
Construction of the
An application for an amendment to the Amaruq Exploration Type B Water License was submitted on
In order to mine the Whale Tail deposit, a Project Certificate for this satellite pit must be obtained from the
The Meliadine gold project was acquired in
In
The Meliadine property also hosts 3.3 million ounces of measured and indicated mineral resources (20.2 million tonnes at 5.06 g/t gold), and 3.5 million ounces of inferred mineral resources (14.1 million tonnes at 7.65 g/t gold). In addition, there are many other known gold occurrences in the 80 km long greenstone belt that require further evaluation.
Internal studies are continuing to evaluate the potential to extract additional gold from the Tiriganiaq and Wesmeg/Normeg deposits, which could extend the potential mine life, increase annual production and improve project economics and the after-tax internal rate of return. These studies are expected to be completed by the end of 2016.
In the second quarter of 2016, approximately 1,098 metres of underground development were completed. A total of approximately 4,302 metres of underground development is planned in 2016.
On
SOUTHERN BUSINESS OPERATING REVIEW
Agnico Eagle's Southern Business operations are focused in Mexico. These operations have been the source of growing precious metals production (gold and silver), stable operating costs and strong free cash flow since 2009. In the second quarter of 2016, the Mexican operations had new record quarterly silver production of approximately 788,000 ounces.
The 100% owned
The
For the first six months of 2016, the
Payable production in the second quarter of 2016 was 49,458 ounces of gold at total cash costs per ounce on a by-product basis of
In the first six months of 2016,
The
The Company continues to evaluate a number of regional opportunities. During the quarter, exploration drilling commenced at the Madrono prospect. Additional details from the Madrono drilling program are set out in the Company's news release of
Creston Mascota Deposit at
The Creston Mascota deposit at
Approximately 573,000 tonnes of ore were stacked on the Creston Mascota leach pad during the second quarter of 2016, compared to approximately 608,500 tonnes stacked in the second quarter of 2015. In the 2016 period lower grades were stacked compared to the 2015 period. Minesite costs per tonne at Creston Mascota were
For the first six months of 2016, approximately 1,089,200 tonnes of ore were stacked on the Creston Mascota leach pad, compared to 1,135,500 tonnes in the prior year period.
For the first six months of 2016, mine site costs per tonne at Creston Mascota were
Payable gold production at Creston Mascota in the second quarter of 2016 was 12,398 ounces at total cash costs per ounce on a by-product basis of
Payable gold production for the first six months of 2016 was 23,949 ounces at total cash costs per ounce on a by-product basis of
Infill drilling continues at Creston Mascota with several high grade intercepts encountered during the period suggesting potential for modest extension of the current mine life.
During the first quarter of 2016, an agreement was signed that allows access to the 51-hectare Madrono property for exploration and mining. The Madrono property is located in an area with good access and infrastructure between the Company's
In the second quarter of 2016, 12 drill holes totaling 2,978 metres were completed on preliminary target areas. Three of the first six holes drilled at Madrono encountered gold and silver mineralization with encouraging grades and widths. Highlights include: 4.1 g/t gold and 64.5 g/t silver (both grades uncapped) over 6.2 metres estimated true width at 45 metres depth in hole MAD16-005. Additional details are presented in the Company's exploration news release of
Permits were obtained in
La
The La India mine in
Approximately 1,534,500 tonnes of ore were stacked on the La India leach pad during the second quarter of 2016, compared to approximately 1,359,500 tonnes stacked in the second quarter of 2015. Minesite costs per tonne at La India were
In the first six months of 2016, approximately 2,930,800 tonnes of ore were stacked on the La India leach pad, compared to approximately 2,738,000 stacked in the first six months of 2015. Minesite costs per tonne at La India were
Payable gold production at La India in the second quarter of 2016 was 27,438 ounces at total cash costs per ounce on a by-product basis of
For the first six months of 2016, La India produced 55,669 ounces of gold at total cash costs per ounce on a by-product basis of
Construction of the haul road to the Main Zone was completed during the second quarter of 2016. Mining activities on the Main Zone began in
During the quarter, several areas on the La India property were drill tested including the infill drilling at the Main Zone and exploration drilling at India East and El Cochi. Encouraging results were obtained from the Main Zone, which could have a positive impact on the year end mineral reserves and mineral resources at La India. At El Cochi, drilling on an outcropping area identified shallow oxidized mineralization and drilling will continue once the change of land use permit is obtained, which is expected in the second half of 2016. In late
On
El Barqueno – Drilling Expands Known Deposits and Outlines New Mineralized Zones
Agnico Eagle acquired its 100% interest in the El Barqueno project in
Year-to-date, 44,985 metres of drilling has been completed at El Barqueno in 2016. Drilling focused on expanding the known areas of mineralization (
Additional details on the El Barqueno drilling are set out in the Company's exploration news release of
In addition to the drilling activities, studies are underway to evaluate possible development scenarios for the project. It is currently envisioned that the project's gold-silver deposits could potentially be developed into a series of open pits utilizing heap leach processing, similar to the Creston Mascota deposit at
Dividend Record and Payment Dates for the Third Quarter of 2016
Agnico Eagle's Board of Directors has declared a quarterly cash dividend of
Other Expected Dividend and Record Dates for 2016
Record Date |
Payment Date |
December 1 |
December 15 |
Dividend Reinvestment Plan
Please follow the link below for information on the Company's dividend reinvestment program. Dividend Reinvestment Plan
About Agnico Eagle
Agnico Eagle is a senior Canadian gold mining company that has produced precious metals since 1957. Its eight mines are located in
Note Regarding Certain Measures of Performance
This news release discloses certain measures, including "total cash costs per ounce", "all-in sustaining costs per ounce", "minesite costs per tonne" and "adjusted net income" that are not standardized measures under IFRS. These data may not be comparable to data reported by other issuers. For a reconciliation of these measures to the most directly comparable financial information reported in the consolidated financial statements prepared in accordance with IFRS, other than adjusted net income, see "Reconciliation of Non-GAAP Financial Performance Measures" below. The total cash costs per ounce of gold produced is reported on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). The total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the consolidated statements of income for by-product revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. The total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as the total cash costs per ounce of gold produced on a by-product basis except that no adjustment is made for by-product metal revenues. Accordingly, the calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. The total cash costs per ounce of gold produced is intended to provide information about the cash-generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash-generating capabilities at various gold prices. All-in sustaining costs per ounce is used to show the full cost of gold production from current operations. The Company calculates all-in sustaining costs per ounce of gold produced on a by-product basis as the aggregate of total cash costs per ounce on a by-product basis, sustaining capital expenditures (including capitalized exploration), general and administrative expenses (including stock options) and reclamation expenses divided by the number of ounces of gold produced. The all-in sustaining costs per ounce of gold produced on a co-product basis is calculated in the same manner as the all-in sustaining costs per ounce of gold produced on a by-product basis, except that the total cash costs per ounce on a co-product basis is used, meaning no adjustment is made for by-product metal revenues. The Company's methodology for calculating all-in sustaining costs per ounce may differ from to the methodology used by other producers that disclose all-in sustaining costs per ounce. The Company may change the methodology it uses to calculate all-in sustaining costs per ounce in the future, including in response to the adoption of formal industry guidance regarding this measure by the
Management also performs sensitivity analyses in order to quantify the effects of fluctuating exchange rates and metal prices. This news release also contains information as to estimated future total cash costs per ounce, all-in sustaining costs per ounce and minesite costs per tonne. The estimates are based upon the total cash costs per ounce, all-in sustaining costs per ounce and minesite costs per tonne that the Company expects to incur to mine gold at its mines and projects and, consistent with the reconciliation of these actual costs referred to above, do not include production costs attributable to accretion expense and other asset retirement costs, which will vary over time as each project is developed and mined. It is therefore not practicable to reconcile these forward-looking non-GAAP financial measures to the most comparable IFRS measure.
Forward-Looking Statements
The information in this news release has been prepared as at
Notes to Investors Regarding the Use of Mineral Resources
Cautionary Note to Investors Concerning Estimates of Measured and Indicated Mineral Resources
This news release uses the terms "measured mineral resources" and "indicated mineral resources". Investors are advised that while those terms are recognized and required by Canadian regulations, the
Cautionary Note to Investors Concerning Estimates of Inferred Mineral Resources
This news release also uses the term "inferred mineral resources". Investors are advised that while this term is recognized and required by Canadian regulations, the
Scientific and Technical Data
The scientific and technical information contained in this news release relating to
Tim Haldane, P.Eng., Senior Vice-President, Operations –
The scientific and technical information relating to Agnico Eagle's mineral reserves and mineral resources contained herein (other than the Canadian Malartic mine) has been approved by Daniel Doucet, Eng., Senior Corporate Director,
Donald Gervais, P.Geo., Director of Technical Services at
In prior periods, mineral reserves and mineral resources for all properties were typically estimated using historic three-year average metals prices and foreign exchange rates in accordance with the
The assumptions used for the mineral reserve and mineral resource estimates at the Canadian Malartic mine as of
NI 43-101 requires mining companies to disclose mineral reserves and mineral resources using the subcategories of "proven mineral reserves", "probable mineral reserves", "measured mineral resources", "indicated mineral resources" and "inferred mineral resources". Mineral resources that are not mineral reserves do not have demonstrated economic viability.
A mineral reserve is the economically mineable part of a measured and/or indicated mineral resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at pre-feasibility or feasibility level as appropriate that include application of modifying factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified.
Modifying factors are considerations used to convert mineral resources to mineral reserves. These include, but are not restricted to, mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental factors.
A proven mineral reserve is the economically mineable part of a measured mineral resource. A proven mineral reserve implies a high degree of confidence in the modifying factors. A probable mineral reserve is the economically mineable part of an indicated and, in some circumstances, a measured mineral resource. The confidence in the modifying factors applying to a probable mineral reserve is lower than that applying to a proven mineral reserve.
A mineral resource is a concentration or occurrence of solid material of economic interest in or on the Earth's crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade or quality, continuity and other geological characteristics of a mineral resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling.
A measured mineral resource is that part of a mineral resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with confidence sufficient to allow the application of modifying factors to support detailed mine planning and final evaluation of the economic viability of the deposit. Geological evidence is derived from detailed and reliable exploration, sampling and testing and is sufficient to confirm geological and grade or quality continuity between points of observation. An indicated mineral resource is that part of a mineral resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of modifying factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing and is sufficient to assume geological and grade or quality continuity between points of observation. An inferred mineral resource is that part of a mineral resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade or quality continuity.
Investors are cautioned not to assume that part or all of an inferred mineral resource exists, or is economically or legally mineable.
A feasibility study is a comprehensive technical and economic study of the selected development option for a mineral project that includes appropriately detailed assessments of applicable modifying factors together with any other relevant operational factors and detailed financial analysis that are necessary to demonstrate, at the time of reporting, that extraction is reasonably justified (economically mineable). The results of the study may reasonably serve as the basis for a final decision by a proponent or financial institution to proceed with, or finance, the development of the project. The confidence level of the study will be higher than that of a pre-feasibility study.
Additional Information
Additional information about each of the mineral projects that is required by NI 43-101, sections 3.2 and 3.3 and paragraphs 3.4 (a), (c) and (d) can be found in Technical Reports, which may be found at www.sedar.com. Other important operating information can be found in the Company's AIF and Form 40-F.
Property/Project name |
Date of most recent |
LaRonde, Bousquet & |
March 23, 2005 |
Canadian Malartic, Quebec, Canada |
June 16, 2014 |
Kittila, Kuotko and |
March 4, 2010 |
Swanson, Quebec, |
|
Meadowbank, Nunavut, |
February 15, 2012 |
Goldex, Quebec, Canada |
October 14, 2012 |
Lapa, Quebec, Canada |
June 8, 2006 |
Meliadine, Nunavut, |
February 11, 2015 |
Akasaba, Quebec, Canada |
|
Amaruq, Nunavut, Canada |
|
Hammond Reef, Ontario, Canada |
July 2, 2013 |
Upper Beaver (Kirkland Lake project), Ontario, Canada |
November 5, 2012 |
Pinos Altos and Creston Mascota, Mexico |
March 25, 2009 |
La India, Mexico |
August 31, 2012 |
AGNICO EAGLE MINES LIMITED | ||||||||||||||
Three Months Ended |
Six Months Ended | |||||||||||||
June 30, |
June 30, | |||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||
Operating margin(i)by mine: |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
\\$ |
54,985 |
\\$ |
32,799 |
\\$ |
103,039 |
\\$ |
62,813 | ||||||
Lapa mine |
14,437 |
11,351 |
25,243 |
26,038 | ||||||||||
Goldex mine |
22,896 |
15,525 |
45,080 |
34,778 | ||||||||||
Meadowbank mine |
34,733 |
49,600 |
68,062 |
96,177 | ||||||||||
Canadian Malartic mine(ii) |
50,133 |
44,737 |
91,874 |
79,456 | ||||||||||
Kittila mine |
22,079 |
16,145 |
46,165 |
43,560 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
48,392 |
44,538 |
84,212 |
79,190 | ||||||||||
Creston Mascota deposit at Pinos Altos |
9,719 |
12,968 |
18,708 |
21,377 | ||||||||||
La India mine |
24,818 |
18,834 |
46,367 |
39,424 | ||||||||||
Total operating margin(i) |
282,192 |
246,497 |
528,750 |
482,813 | ||||||||||
Amortization of property, plant and mine development |
154,658 |
157,615 |
300,289 |
293,512 | ||||||||||
Exploration, corporate and other |
89,624 |
67,973 |
163,354 |
111,679 | ||||||||||
Income before income and mining taxes |
37,910 |
20,909 |
65,107 |
77,622 | ||||||||||
Income and mining taxes expense |
18,920 |
10,826 |
18,329 |
38,796 | ||||||||||
Net income for the period |
\\$ |
18,990 |
\\$ |
10,083 |
\\$ |
46,778 |
\\$ |
38,826 | ||||||
Net income per share — basic (US\\$) |
\\$ |
0.09 |
\\$ |
0.05 |
\\$ |
0.21 |
\\$ |
0.18 | ||||||
Net income per share — diluted (US\\$) |
\\$ |
0.08 |
\\$ |
0.05 |
\\$ |
0.21 |
\\$ |
0.18 | ||||||
Cash flows: |
||||||||||||||
Cash provided by operating activities |
\\$ |
229,456 |
\\$ |
188,349 |
\\$ |
375,160 |
\\$ |
331,804 | ||||||
Cash used in investing activities |
\\$ |
(122,651) |
\\$ |
(104,476) |
\\$ |
(230,246) |
\\$ |
(158,368) | ||||||
Cash provided by (used in) financing activities |
\\$ |
199,494 |
\\$ |
(64,514) |
\\$ |
197,906 |
\\$ |
(187,696) | ||||||
Realized prices (US\\$): |
||||||||||||||
Gold (per ounce) |
\\$ |
1,268 |
\\$ |
1,196 |
\\$ |
1,230 |
\\$ |
1,199 | ||||||
Silver (per ounce) |
\\$ |
17.21 |
\\$ |
16.41 |
\\$ |
16.25 |
\\$ |
16.68 | ||||||
Zinc (per tonne) |
\\$ |
1,852 |
\\$ |
2,231 |
\\$ |
1,704 |
\\$ |
2,130 | ||||||
Copper (per tonne) |
\\$ |
4,714 |
\\$ |
6,274 |
\\$ |
4,506 |
\\$ |
5,656 | ||||||
Payable production(iii): |
||||||||||||||
Gold (ounces): |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
75,159 |
64,007 |
150,496 |
122,900 | ||||||||||
Lapa mine |
21,914 |
19,450 |
43,623 |
45,370 | ||||||||||
Goldex mine |
31,452 |
26,462 |
63,792 |
55,712 | ||||||||||
Meadowbank mine |
72,402 |
91,276 |
144,713 |
179,799 | ||||||||||
Canadian Malartic mine(ii) |
72,502 |
68,441 |
146,115 |
136,334 | ||||||||||
Kittila mine |
46,209 |
41,986 |
94,336 |
86,640 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
49,458 |
50,647 |
97,575 |
100,753 | ||||||||||
Creston Mascota deposit at Pinos Altos |
12,398 |
15,606 |
23,949 |
28,054 | ||||||||||
La India mine |
27,438 |
25,803 |
55,669 |
52,326 | ||||||||||
Total gold (ounces) |
408,932 |
403,678 |
820,268 |
807,888 | ||||||||||
Silver (thousands of ounces): |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
266 |
201 |
512 |
398 | ||||||||||
Lapa mine |
1 |
1 |
4 |
1 | ||||||||||
Goldex mine |
1 |
- |
1 |
- | ||||||||||
Meadowbank mine |
66 |
57 |
109 |
153 | ||||||||||
Canadian Malartic mine(ii) |
86 |
69 |
164 |
141 | ||||||||||
Kittila mine |
2 |
2 |
5 |
5 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
633 |
576 |
1,220 |
1,139 | ||||||||||
Creston Mascota deposit at Pinos Altos |
50 |
37 |
98 |
69 | ||||||||||
La India mine |
105 |
72 |
222 |
141 | ||||||||||
Total silver (thousands of ounces) |
1,210 |
1,015 |
2,335 |
2,047 | ||||||||||
Zinc (tonnes) |
1,318 |
827 |
1,932 |
1,763 | ||||||||||
Copper (tonnes) |
1,141 |
1,133 |
2,295 |
2,300 | ||||||||||
Payable metal sold: |
||||||||||||||
Gold (ounces): |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
72,005 |
59,376 |
147,262 |
120,319 | ||||||||||
Lapa mine |
22,911 |
20,771 |
42,747 |
44,268 | ||||||||||
Goldex mine |
30,605 |
27,306 |
62,560 |
55,213 | ||||||||||
Meadowbank mine |
70,021 |
96,870 |
141,610 |
181,649 | ||||||||||
Canadian Malartic mine(ii)(iv) |
72,259 |
67,522 |
137,344 |
126,783 | ||||||||||
Kittila mine |
44,580 |
39,385 |
95,305 |
88,386 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
52,287 |
54,402 |
95,511 |
95,835 | ||||||||||
Creston Mascota deposit at Pinos Altos |
12,117 |
16,537 |
23,962 |
27,936 | ||||||||||
La India mine |
27,748 |
23,803 |
53,913 |
50,701 | ||||||||||
Total gold (ounces) |
404,533 |
405,972 |
800,214 |
791,090 | ||||||||||
Silver (thousands of ounces): |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
267 |
225 |
499 |
429 | ||||||||||
Lapa mine |
- |
- |
1 |
- | ||||||||||
Goldex mine |
1 |
- |
1 |
- | ||||||||||
Meadowbank mine |
66 |
59 |
109 |
157 | ||||||||||
Canadian Malartic mine(ii)(iv) |
76 |
80 |
149 |
134 | ||||||||||
Kittila mine |
2 |
2 |
5 |
5 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
647 |
616 |
1,177 |
1,062 | ||||||||||
Creston Mascota deposit at Pinos Altos |
49 |
48 |
96 |
68 | ||||||||||
La India mine |
123 |
76 |
210 |
139 | ||||||||||
Total silver (thousands of ounces): |
1,231 |
1,106 |
2,247 |
1,994 | ||||||||||
Zinc (tonnes) |
673 |
733 |
1,278 |
1,997 | ||||||||||
Copper (tonnes) |
1,164 |
1,131 |
2,320 |
2,291 | ||||||||||
Total cash costs per ounce of gold produced - co-product basis (US\\$)(v): |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
\\$ |
707 |
\\$ |
811 |
\\$ |
689 |
\\$ |
850 | ||||||
Lapa mine |
658 |
679 |
663 |
616 | ||||||||||
Goldex mine |
513 |
633 |
510 |
585 | ||||||||||
Meadowbank mine |
804 |
699 |
801 |
686 | ||||||||||
Canadian Malartic mine(ii) |
641 |
626 |
606 |
638 | ||||||||||
Kittila mine |
757 |
777 |
742 |
728 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
583 |
570 |
557 |
559 | ||||||||||
Creston Mascota deposit at Pinos Altos |
542 |
441 |
535 |
462 | ||||||||||
La India mine |
451 |
456 |
437 |
458 | ||||||||||
Weighted average total cash costs per ounce of gold produced |
\\$ |
663 |
\\$ |
666 |
\\$ |
647 |
\\$ |
658 | ||||||
Total cash costs per ounce of gold produced - by-product basis (US\\$)(v): |
||||||||||||||
Northern Business |
||||||||||||||
LaRonde mine |
\\$ |
543 |
\\$ |
613 |
\\$ |
536 |
\\$ |
656 | ||||||
Lapa mine |
658 |
678 |
663 |
615 | ||||||||||
Goldex mine |
513 |
633 |
509 |
585 | ||||||||||
Meadowbank mine |
789 |
688 |
789 |
672 | ||||||||||
Canadian Malartic mine(ii) |
621 |
609 |
589 |
621 | ||||||||||
Kittila mine |
756 |
776 |
741 |
727 | ||||||||||
Southern Business |
||||||||||||||
Pinos Altos mine |
348 |
384 |
346 |
371 | ||||||||||
Creston Mascota deposit at Pinos Altos |
469 |
402 |
465 |
421 | ||||||||||
La India mine |
381 |
410 |
371 |
414 | ||||||||||
Weighted average total cash costs per ounce of gold produced |
\\$ |
592 |
\\$ |
601 |
\\$ |
582 |
\\$ |
595 |
Notes: |
|
(i) |
Operating margin is calculated as revenues from mining operations less production costs. |
(ii) |
On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of Osisko by way of a statutory plan of arrangement (the "Arrangement"). As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of CMC and the Partnership, which now holds the Canadian Malartic mine. The information set out in this table reflects the Company's 50.0% interest in the Canadian Malartic mine. |
(iii) |
Payable production (a non-GAAP non-financial performance measure) is the quantity of mineral produced during a period contained in products that are or will be sold by the Company, whether such products are sold during the period or held as inventories at the end of the period. |
(iv) |
The Canadian Malartic mine's payable metal sold excludes the 5.0% net smelter royalty transferred to Osisko Gold Royalties Ltd., pursuant to the Arrangement. |
(v) |
Total cash costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data reported by other gold producers. Total cash costs per ounce of gold produced is reported on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the interim condensed consolidated statements of income for by-product metal revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. The calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. The Company believes that these generally accepted industry measures provide a realistic indication of operating performance and provide useful comparison points between periods. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates. |
AGNICO EAGLE MINES LIMITED | ||||||||
As at |
As at | |||||||
2016 |
2015 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
\\$ |
467,902 |
\\$ |
124,150 | ||||
Short-term investments |
5,749 |
7,444 | ||||||
Restricted cash |
676 |
685 | ||||||
Trade receivables |
5,443 |
7,714 | ||||||
Inventories |
438,726 |
461,976 | ||||||
Income taxes recoverable |
8,887 |
817 | ||||||
Available-for-sale securities |
85,581 |
31,863 | ||||||
Fair value of derivative financial instruments |
2,454 |
87 | ||||||
Other current assets |
181,342 |
194,689 | ||||||
Total current assets |
1,196,760 |
829,425 | ||||||
Non-current assets: |
||||||||
Restricted cash |
789 |
741 | ||||||
Goodwill |
696,809 |
696,809 | ||||||
Property, plant and mine development |
5,063,100 |
5,088,967 | ||||||
Other assets |
66,737 |
67,238 | ||||||
Total assets |
\\$ |
7,024,195 |
\\$ |
6,683,180 | ||||
LIABILITIES AND EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable and accrued liabilities |
\\$ |
239,778 |
\\$ |
243,786 | ||||
Reclamation provision |
10,347 |
6,245 | ||||||
Interest payable |
13,898 |
14,526 | ||||||
Income taxes payable |
13,113 |
14,852 | ||||||
Finance lease obligations |
7,174 |
9,589 | ||||||
Current portion of long-term debt |
130,374 |
14,451 | ||||||
Fair value of derivative financial instruments |
719 |
8,073 | ||||||
Total current liabilities |
415,403 |
311,522 | ||||||
Non-current liabilities: |
||||||||
Long-term debt |
1,072,754 |
1,118,187 | ||||||
Reclamation provision |
326,628 |
276,299 | ||||||
Deferred income and mining tax liabilities |
797,319 |
802,114 | ||||||
Other liabilities |
32,844 |
34,038 | ||||||
Total liabilities |
2,644,948 |
2,542,160 | ||||||
EQUITY |
||||||||
Common shares: |
||||||||
Outstanding - 224,188,926 common shares issued, less |
4,926,048 |
4,707,940 | ||||||
Stock options |
181,766 |
216,232 | ||||||
Contributed surplus |
37,254 |
37,254 | ||||||
Deficit |
(812,421) |
(823,734) | ||||||
Accumulated other comprehensive income |
46,600 |
3,328 | ||||||
Total equity |
4,379,247 |
4,141,020 | ||||||
Total liabilities and equity |
\\$ |
7,024,195 |
\\$ |
6,683,180 |
AGNICO EAGLE MINES LIMITED | ||||||||||||||
Three Months Ended |
Six Months Ended | |||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||
REVENUES |
||||||||||||||
Revenues from mining operations |
\\$ |
537,628 |
\\$ |
510,109 |
\\$ |
1,028,159 |
\\$ |
993,705 | ||||||
COSTS, EXPENSES AND OTHER INCOME |
||||||||||||||
Production (i) |
255,436 |
263,612 |
499,409 |
510,892 | ||||||||||
Exploration and corporate development |
38,100 |
30,616 |
66,485 |
47,267 | ||||||||||
Amortization of property, plant and mine development |
154,658 |
157,615 |
300,289 |
293,512 | ||||||||||
General and administrative |
24,337 |
23,572 |
49,160 |
48,793 | ||||||||||
Impairment loss on available-for-sale securities |
- |
345 |
- |
1,030 | ||||||||||
Finance costs |
17,391 |
17,955 |
35,192 |
37,667 | ||||||||||
Gain on derivative financial instruments |
(670) |
(8,836) |
(10,291) |
(260) | ||||||||||
Gain on sale of available-for-sale securities |
(1,799) |
(2,675) |
(1,918) |
(23,724) | ||||||||||
Environmental remediation |
840 |
(141) |
5,933 |
288 | ||||||||||
Foreign currency translation loss (gain) |
5,517 |
4,779 |
12,287 |
(6,911) | ||||||||||
Other expenses |
5,908 |
2,358 |
6,506 |
7,529 | ||||||||||
Income before income and mining taxes |
37,910 |
20,909 |
65,107 |
77,622 | ||||||||||
Income and mining taxes expense |
18,920 |
10,826 |
18,329 |
38,796 | ||||||||||
Net income for the period |
\\$ |
18,990 |
\\$ |
10,083 |
\\$ |
46,778 |
\\$ |
38,826 | ||||||
Net income per share - basic |
\\$ |
0.09 |
\\$ |
0.05 |
\\$ |
0.21 |
\\$ |
0.18 | ||||||
Net income per share - diluted |
\\$ |
0.08 |
\\$ |
0.05 |
\\$ |
0.21 |
\\$ |
0.18 | ||||||
Weighted average number of common shares outstanding (in thousands): |
||||||||||||||
Basic |
222,165 |
215,426 |
220,925 |
214,996 | ||||||||||
Diluted |
225,169 |
216,722 |
223,568 |
216,186 | ||||||||||
Note: |
||||||||||||||
(i) Exclusive of amortization, which is shown separately. |
AGNICO EAGLE MINES LIMITED | |||||||||||||||||
Three Months Ended |
Six Months Ended | ||||||||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||||||||
OPERATING ACTIVITIES |
|||||||||||||||||
Net income for the period |
\\$ |
18,990 |
\\$ |
10,083 |
\\$ |
46,778 |
\\$ |
38,826 | |||||||||
Add (deduct) items not affecting cash: |
|||||||||||||||||
Amortization of property, plant and mine development |
154,658 |
157,615 |
300,289 |
293,512 | |||||||||||||
Deferred income and mining taxes |
3,665 |
(13,680) |
(13,321) |
5,620 | |||||||||||||
Gain on sale of available-for-sale securities |
(1,799) |
(2,675) |
(1,918) |
(23,724) | |||||||||||||
Stock-based compensation |
7,860 |
8,131 |
17,646 |
19,849 | |||||||||||||
Impairment loss on available-for-sale securities |
- |
345 |
- |
1,030 | |||||||||||||
Foreign currency translation loss (gain) |
5,517 |
4,779 |
12,287 |
(6,911) | |||||||||||||
Other |
4,227 |
(11,403) |
68 |
2,133 | |||||||||||||
Adjustment for settlement of reclamation provision |
(402) |
(407) |
(1,634) |
(709) | |||||||||||||
Changes in non-cash working capital balances: |
|||||||||||||||||
Trade receivables |
198 |
22 |
2,271 |
(1,462) | |||||||||||||
Income taxes |
3,915 |
13,043 |
(9,809) |
(11,020) | |||||||||||||
Inventories |
6,894 |
11,623 |
31,505 |
22,035 | |||||||||||||
Other current assets |
6,124 |
(18,186) |
10,144 |
(23,023) | |||||||||||||
Accounts payable and accrued liabilities |
28,539 |
36,435 |
(17,797) |
15,853 | |||||||||||||
Interest payable |
(8,930) |
(7,376) |
(1,349) |
(205) | |||||||||||||
Cash provided by operating activities |
229,456 |
188,349 |
375,160 |
331,804 | |||||||||||||
INVESTING ACTIVITIES |
|||||||||||||||||
Additions to property, plant and mine development |
(123,263) |
(111,511) |
(223,957) |
(194,398) | |||||||||||||
Acquisitions, net of cash and cash equivalents acquired |
(5,499) |
(5,983) |
(5,499) |
(12,983) | |||||||||||||
Net (purchases) sales of short-term investments |
(540) |
(947) |
1,695 |
(1,048) | |||||||||||||
Net proceeds from sale of available-for-sale securities and other investments |
6,979 |
18,643 |
7,278 |
56,311 | |||||||||||||
Purchase of available-for-sale securities and other investments |
(327) |
(14,158) |
(9,772) |
(19,433) | |||||||||||||
(Increase) decrease in restricted cash |
(1) |
9,480 |
9 |
13,183 | |||||||||||||
Cash used in investing activities |
(122,651) |
(104,476) |
(230,246) |
(158,368) | |||||||||||||
FINANCING ACTIVITIES |
|||||||||||||||||
Dividends paid |
(15,352) |
(14,423) |
(30,198) |
(29,198) | |||||||||||||
Repayment of finance lease obligations |
(2,570) |
(5,039) |
(5,084) |
(13,444) | |||||||||||||
Proceeds from long-term debt |
50,000 |
75,000 |
125,000 |
75,000 | |||||||||||||
Repayment of long-term debt |
(275,374) |
(126,086) |
(405,374) |
(226,086) | |||||||||||||
Notes issuance |
350,000 |
- |
350,000 |
- | |||||||||||||
Long-term debt financing |
(2,169) |
- |
(2,169) |
- | |||||||||||||
Repurchase of common shares for stock-based compensation plans |
(632) |
(1,257) |
(15,527) |
(11,899) | |||||||||||||
Proceeds on exercise of stock options |
93,003 |
4,735 |
157,427 |
12,958 | |||||||||||||
Common shares issued |
2,588 |
2,556 |
23,831 |
4,973 | |||||||||||||
Cash provided by (used in) financing activities |
199,494 |
(64,514) |
197,906 |
(187,696) | |||||||||||||
Effect of exchange rate changes on cash and cash equivalents |
(1,143) |
966 |
932 |
(4,946) | |||||||||||||
Net increase (decrease) in cash and cash equivalents during the period |
305,156 |
20,325 |
343,752 |
(19,206) | |||||||||||||
Cash and cash equivalents, beginning of period |
162,746 |
138,006 |
124,150 |
177,537 | |||||||||||||
Cash and cash equivalents, end of period |
\\$ |
467,902 |
\\$ |
158,331 |
\\$ |
467,902 |
\\$ |
158,331 | |||||||||
SUPPLEMENTAL CASH FLOW INFORMATION |
|||||||||||||||||
Interest paid |
\\$ |
24,540 |
\\$ |
24,817 |
\\$ |
33,420 |
\\$ |
35,898 | |||||||||
Income and mining taxes paid |
\\$ |
13,448 |
\\$ |
151 |
\\$ |
66,765 |
\\$ |
38,098 |
AGNICO EAGLE MINES LIMITED | |||||||||||||||
Total Production Costs by Mine |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | ||||||||||||
(thousands of United States dollars) |
|||||||||||||||
LaRonde mine |
\\$ |
40,500 |
\\$ |
45,133 |
\\$ |
86,354 |
\\$ |
90,999 | |||||||
Lapa mine |
14,791 |
13,656 |
27,575 |
27,641 | |||||||||||
Goldex mine |
15,937 |
16,913 |
31,669 |
31,780 | |||||||||||
Meadowbank mine |
54,761 |
66,888 |
106,971 |
123,983 | |||||||||||
Canadian Malartic mine(i) |
47,974 |
42,185 |
88,788 |
83,371 | |||||||||||
Kittila mine |
34,055 |
30,777 |
70,082 |
62,776 | |||||||||||
Pinos Altos mine |
28,794 |
29,768 |
52,650 |
53,979 | |||||||||||
Creston Mascota deposit at Pinos Altos |
6,623 |
7,501 |
12,404 |
13,107 | |||||||||||
La India mine |
12,001 |
10,791 |
22,916 |
23,256 | |||||||||||
Production costs per the interim condensed |
\\$ |
255,436 |
\\$ |
263,612 |
\\$ |
499,409 |
\\$ |
510,892 | |||||||
Reconciliation of Production Costs to Total Cash Costs per Ounce of Gold Produced(ii)by Mine and Reconciliation of | |||||||||||||||
LaRonde Mine - Total Cash Costs per Ounce of Gold Produced(ii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
40,500 |
\\$ |
45,133 |
\\$ |
86,354 |
\\$ |
90,999 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
12,658 |
6,786 |
17,277 |
13,464 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
53,158 |
\\$ |
51,919 |
\\$ |
103,631 |
\\$ |
104,463 | |||||||
By-product metal revenues |
(12,369) |
(12,701) |
(23,015) |
(23,835) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
40,789 |
\\$ |
39,218 |
\\$ |
80,616 |
\\$ |
80,628 | |||||||
Gold production (ounces) |
75,159 |
64,007 |
150,496 |
122,900 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
707 |
\\$ |
811 |
\\$ |
689 |
\\$ |
850 | |||||||
By-product basis |
\\$ |
543 |
\\$ |
613 |
\\$ |
536 |
\\$ |
656 | |||||||
LaRonde Mine - Minesite Costs per Tonne(iii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
40,500 |
\\$ |
45,133 |
\\$ |
86,354 |
\\$ |
90,999 | |||||||
Inventory and other adjustments(v) |
6,136 |
854 |
3,779 |
1,719 | |||||||||||
Minesite operating costs |
\\$ |
46,636 |
\\$ |
45,987 |
\\$ |
90,133 |
\\$ |
92,718 | |||||||
Minesite operating costs (thousands of C\\$) |
C\\$ |
60,288 |
C\\$ |
56,474 |
C\\$ |
119,516 |
C\\$ |
114,263 | |||||||
Tonnes of ore milled (thousands of tonnes) |
569 |
568 |
1,146 |
1,126 | |||||||||||
Minesite costs per tonne (C\\$)(iii) |
C\\$ |
106 |
C\\$ |
99 |
C\\$ |
104 |
C\\$ |
101 | |||||||
Lapa Mine - Total Cash Costs per Ounce of Gold Produced(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
14,791 |
\\$ |
13,656 |
\\$ |
27,575 |
\\$ |
27,641 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
(375) |
(459) |
1,352 |
290 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
14,416 |
\\$ |
13,197 |
\\$ |
28,927 |
\\$ |
27,931 | |||||||
By-product metal revenues |
(4) |
(1) |
(17) |
(18) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
14,412 |
\\$ |
13,196 |
\\$ |
28,910 |
\\$ |
27,913 | |||||||
Gold production (ounces) |
21,914 |
19,450 |
43,623 |
45,370 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
658 |
\\$ |
679 |
\\$ |
663 |
\\$ |
616 | |||||||
By-product basis |
\\$ |
658 |
\\$ |
678 |
\\$ |
663 |
\\$ |
615 | |||||||
Lapa Mine - Minesite Costs per Tonne(iii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
14,791 |
\\$ |
13,656 |
\\$ |
27,575 |
\\$ |
27,641 | |||||||
Inventory and other adjustments(v) |
(385) |
(658) |
1,174 |
(109) | |||||||||||
Minesite operating costs |
\\$ |
14,406 |
\\$ |
12,998 |
\\$ |
28,749 |
\\$ |
27,532 | |||||||
Minesite operating costs (thousands of C\\$) |
C\\$ |
18,627 |
C\\$ |
15,919 |
C\\$ |
38,108 |
C\\$ |
33,996 | |||||||
Tonnes of ore milled (thousands of tonnes) |
161 |
126 |
322 |
278 | |||||||||||
Minesite costs per tonne (C\\$)(iii) |
C\\$ |
116 |
C\\$ |
126 |
C\\$ |
118 |
C\\$ |
122 | |||||||
Goldex Mine - Total Cash Costs per Ounce of Gold Produced(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
15,937 |
\\$ |
16,913 |
\\$ |
31,669 |
\\$ |
31,780 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
211 |
(163) |
835 |
810 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
16,148 |
\\$ |
16,750 |
\\$ |
32,504 |
\\$ |
32,590 | |||||||
By-product metal revenues |
(2) |
(5) |
(8) |
(13) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
16,146 |
\\$ |
16,745 |
\\$ |
32,496 |
\\$ |
32,577 | |||||||
Gold production (ounces) |
31,452 |
26,462 |
63,792 |
55,712 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
513 |
\\$ |
633 |
\\$ |
510 |
\\$ |
585 | |||||||
By-product basis |
\\$ |
513 |
\\$ |
633 |
\\$ |
509 |
\\$ |
585 | |||||||
Goldex Mine - Minesite Costs per Tonne(iii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
15,937 |
\\$ |
16,913 |
\\$ |
31,669 |
\\$ |
31,780 | |||||||
Inventory and other adjustments(v) |
281 |
(328) |
632 |
432 | |||||||||||
Minesite operating costs |
\\$ |
16,218 |
\\$ |
16,585 |
\\$ |
32,301 |
\\$ |
32,212 | |||||||
Minesite operating costs (thousands of C\\$) |
C\\$ |
21,108 |
C\\$ |
20,318 |
C\\$ |
42,814 |
C\\$ |
39,635 | |||||||
Tonnes of ore milled (thousands of tonnes) |
658 |
604 |
1,294 |
1,171 | |||||||||||
Minesite costs per tonne (C\\$)(iii) |
C\\$ |
32 |
C\\$ |
34 |
C\\$ |
33 |
C\\$ |
34 | |||||||
Meadowbank Mine - Total Cash Costs per Ounce of Gold Produced(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
54,761 |
\\$ |
66,888 |
\\$ |
106,971 |
\\$ |
123,983 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
3,474 |
(3,094) |
8,920 |
(554) | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
58,235 |
\\$ |
63,794 |
\\$ |
115,891 |
\\$ |
123,429 | |||||||
By-product metal revenues |
(1,115) |
(978) |
(1,774) |
(2,667) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
57,120 |
\\$ |
62,816 |
\\$ |
114,117 |
\\$ |
120,762 | |||||||
Gold production (ounces) |
72,402 |
91,276 |
144,713 |
179,799 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
804 |
\\$ |
699 |
\\$ |
801 |
\\$ |
686 | |||||||
By-product basis |
\\$ |
789 |
\\$ |
688 |
\\$ |
789 |
\\$ |
672 | |||||||
Meadowbank Mine - Minesite Costs per Tonne(iii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
54,761 |
\\$ |
66,888 |
\\$ |
106,971 |
\\$ |
123,983 | |||||||
Inventory and other adjustments(v) |
1,837 |
(3,768) |
4,595 |
(2,074) | |||||||||||
Minesite operating costs |
\\$ |
56,598 |
\\$ |
63,120 |
\\$ |
111,566 |
\\$ |
121,909 | |||||||
Minesite operating costs (thousands of C\\$) |
C\\$ |
72,454 |
C\\$ |
75,290 |
C\\$ |
145,512 |
C\\$ |
145,917 | |||||||
Tonnes of ore milled (thousands of tonnes) |
993 |
1,019 |
1,939 |
2,010 | |||||||||||
Minesite costs per tonne (C\\$)(iii) |
C\\$ |
73 |
C\\$ |
74 |
C\\$ |
75 |
C\\$ |
73 | |||||||
Canadian Malartic Mine - Total Cash Costs per Ounce of Gold Produced(i)(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
47,974 |
\\$ |
42,185 |
\\$ |
88,788 |
\\$ |
83,371 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
(1,502) |
688 |
(193) |
3,554 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
46,472 |
\\$ |
42,873 |
\\$ |
88,595 |
\\$ |
86,925 | |||||||
By-product metal revenues |
(1,442) |
(1,177) |
(2,537) |
(2,319) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
45,030 |
\\$ |
41,696 |
\\$ |
86,058 |
\\$ |
84,606 | |||||||
Gold production (ounces) |
72,502 |
68,441 |
146,115 |
136,334 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
641 |
\\$ |
626 |
\\$ |
606 |
\\$ |
638 | |||||||
By-product basis |
\\$ |
621 |
\\$ |
609 |
\\$ |
589 |
\\$ |
621 | |||||||
Canadian Malartic Mine - Minesite Costs per Tonne(i)(iii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
47,974 |
\\$ |
42,185 |
\\$ |
88,788 |
\\$ |
83,371 | |||||||
Inventory and other adjustments(v) |
(1,763) |
48 |
(687) |
1,733 | |||||||||||
Minesite operating costs |
\\$ |
46,211 |
\\$ |
42,233 |
\\$ |
88,101 |
\\$ |
85,104 | |||||||
Minesite operating costs (thousands of C\\$) |
C\\$ |
59,541 |
C\\$ |
51,937 |
C\\$ |
117,086 |
C\\$ |
105,126 | |||||||
Tonnes of ore milled (thousands of tonnes) |
2,525 |
2,307 |
4,905 |
4,647 | |||||||||||
Minesite costs per tonne (C\\$)(iii) |
C\\$ |
24 |
C\\$ |
23 |
C\\$ |
24 |
C\\$ |
23 | |||||||
Kittila Mine - Total Cash Costs per Ounce of Gold Produced(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
34,055 |
\\$ |
30,777 |
\\$ |
70,082 |
\\$ |
62,776 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
922 |
1,855 |
(102) |
312 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
34,977 |
\\$ |
32,632 |
\\$ |
69,980 |
\\$ |
63,088 | |||||||
By-product metal revenues |
(32) |
(38) |
(79) |
(73) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
34,945 |
\\$ |
32,594 |
\\$ |
69,901 |
\\$ |
63,015 | |||||||
Gold production (ounces) |
46,209 |
41,986 |
94,336 |
86,640 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
757 |
\\$ |
777 |
\\$ |
742 |
\\$ |
728 | |||||||
By-product basis |
\\$ |
756 |
\\$ |
776 |
\\$ |
741 |
\\$ |
727 | |||||||
Kittila Mine - Minesite Costs per Tonne(iii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
34,055 |
\\$ |
30,777 |
\\$ |
70,082 |
\\$ |
62,776 | |||||||
Inventory and other adjustments(v) |
816 |
1,858 |
(381) |
199 | |||||||||||
Minesite operating costs |
\\$ |
34,871 |
\\$ |
32,635 |
\\$ |
69,701 |
\\$ |
62,975 | |||||||
Minesite operating costs (thousands of €) |
€ |
31,381 |
€ |
28,296 |
€ |
62,490 |
€ |
55,010 | |||||||
Tonnes of ore milled (thousands of tonnes) |
389 |
379 |
821 |
725 | |||||||||||
Minesite costs per tonne (€)(iii) |
€ |
81 |
€ |
75 |
€ |
76 |
€ |
76 | |||||||
Pinos Altos Mine - Total Cash Costs per Ounce of Gold Produced(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
28,794 |
\\$ |
29,768 |
\\$ |
52,650 |
\\$ |
53,979 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
16 |
(892) |
1,651 |
2,353 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
28,810 |
\\$ |
28,876 |
\\$ |
54,301 |
\\$ |
56,332 | |||||||
By-product metal revenues |
(11,577) |
(9,404) |
(20,549) |
(18,978) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
17,233 |
\\$ |
19,472 |
\\$ |
33,752 |
\\$ |
37,354 | |||||||
Gold production (ounces) |
49,458 |
50,647 |
97,575 |
100,753 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
583 |
\\$ |
570 |
\\$ |
557 |
\\$ |
559 | |||||||
By-product basis |
\\$ |
348 |
\\$ |
384 |
\\$ |
346 |
\\$ |
371 | |||||||
Pinos Altos Mine - Minesite Costs per Tonne(iii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
28,794 |
\\$ |
29,768 |
\\$ |
52,650 |
\\$ |
53,979 | |||||||
Inventory and other adjustments(v) |
(416) |
(1,732) |
880 |
948 | |||||||||||
Minesite operating costs |
\\$ |
28,378 |
\\$ |
28,036 |
\\$ |
53,530 |
\\$ |
54,927 | |||||||
Tonnes of ore processed (thousands of tonnes) |
605 |
648 |
1,107 |
1,231 | |||||||||||
Minesite costs per tonne (US\\$)(iii) |
\\$ |
47 |
\\$ |
43 |
\\$ |
48 |
\\$ |
45 | |||||||
Creston Mascota deposit at Pinos Altos - Total Cash Costs per Ounce of Gold Produced(ii) | |||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
6,623 |
\\$ |
7,501 |
\\$ |
12,404 |
\\$ |
13,107 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
92 |
(611) |
402 |
(143) | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
6,715 |
\\$ |
6,890 |
\\$ |
12,806 |
\\$ |
12,964 | |||||||
By-product metal revenues |
(898) |
(611) |
(1,680) |
(1,158) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
5,817 |
\\$ |
6,279 |
\\$ |
11,126 |
\\$ |
11,806 | |||||||
Gold production (ounces) |
12,398 |
15,606 |
23,949 |
28,054 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
542 |
\\$ |
441 |
\\$ |
535 |
\\$ |
462 | |||||||
By-product basis |
\\$ |
469 |
\\$ |
402 |
\\$ |
465 |
\\$ |
421 | |||||||
Creston Mascota deposit at Pinos Altos - Minesite Costs per Tonne(iii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
6,623 |
\\$ |
7,501 |
\\$ |
12,404 |
\\$ |
13,107 | |||||||
Inventory and other adjustments(v) |
31 |
(691) |
226 |
(292) | |||||||||||
Minesite operating costs |
\\$ |
6,654 |
\\$ |
6,810 |
\\$ |
12,630 |
\\$ |
12,815 | |||||||
Tonnes of ore processed (thousands of tonnes) |
573 |
609 |
1,089 |
1,135 | |||||||||||
Minesite costs per tonne (US\\$)(iii) |
\\$ |
12 |
\\$ |
11 |
\\$ |
12 |
\\$ |
11 | |||||||
La India Mine - Total Cash Costs per Ounce of Gold Produced(ii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
12,001 |
\\$ |
10,791 |
\\$ |
22,916 |
\\$ |
23,256 | |||||||
Adjustments: |
|||||||||||||||
Inventory and other adjustments(iv) |
361 |
963 |
1,415 |
718 | |||||||||||
Cash operating costs (co-product basis) |
\\$ |
12,362 |
\\$ |
11,754 |
\\$ |
24,331 |
\\$ |
23,974 | |||||||
By-product metal revenues |
(1,907) |
(1,179) |
(3,703) |
(2,311) | |||||||||||
Cash operating costs (by-product basis) |
\\$ |
10,455 |
\\$ |
10,575 |
\\$ |
20,628 |
\\$ |
21,663 | |||||||
Gold production (ounces) |
27,438 |
25,803 |
55,669 |
52,326 | |||||||||||
Total cash costs per ounce of gold produced (\\$ per ounce)(ii): |
|||||||||||||||
Co-product basis |
\\$ |
451 |
\\$ |
456 |
\\$ |
437 |
\\$ |
458 | |||||||
By-product basis |
\\$ |
381 |
\\$ |
410 |
\\$ |
371 |
\\$ |
414 | |||||||
La India Mine - Minesite Costs per Tonne(iii) |
|||||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||||
(thousands of United States dollars, except as noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||||
Production costs |
\\$ |
12,001 |
\\$ |
10,791 |
\\$ |
22,916 |
\\$ |
23,256 | |||||||
Inventory and other adjustments(v) |
(1) |
771 |
818 |
362 | |||||||||||
Minesite operating costs |
\\$ |
12,000 |
\\$ |
11,562 |
\\$ |
23,734 |
\\$ |
23,618 | |||||||
Tonnes of ore processed (thousands of tonnes) |
1,535 |
1,360 |
2,931 |
2,738 | |||||||||||
Minesite costs per tonne (US\\$)(iii) |
\\$ |
8 |
\\$ |
9 |
\\$ |
8 |
\\$ |
9 |
Notes: | |
(i) |
On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of Osisko by way of the Arrangement. As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of CMC and the Partnership, which now holds the Canadian Malartic mine. The information set out in this table reflects the Company's 50.0% interest in the Canadian Malartic mine. |
(ii) |
Total cash costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data reported by other gold producers. Total cash costs per ounce of gold produced is reported on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the interim condensed consolidated statements of income for by-product metal revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. The calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. The Company believes that these generally accepted industry measures provide a realistic indication of operating performance and provide useful comparison points between periods. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne (discussed below) as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates. |
(iii) |
Minesite costs per tonne is not a recognized measure under IFRS and this data may not be comparable to data reported by other gold producers. This measure is calculated by adjusting production costs as shown in the interim condensed consolidated statements of income for unsold concentrate inventory production costs, and then dividing by tonnes of ore milled. As the total cash costs per ounce of gold produced measure can be affected by fluctuations in by-product metal prices and exchange rates, management believes that the minesite costs per tonne measure provides additional information regarding the performance of mining operations, eliminating the impact of varying production levels. Management also uses this measure to determine the economic viability of mining blocks. As each mining block is evaluated based on the net realizable value of each tonne mined, in order to be economically viable the estimated revenue on a per tonne basis must be in excess of the minesite costs per tonne. Management is aware that this per tonne measure of performance can be impacted by fluctuations in processing levels and compensates for this inherent limitation by using this measure in conjunction with production costs prepared in accordance with IFRS. |
(iv) |
Under the Company's revenue recognition policy, revenue is recognized on concentrates when legal title and risk is transferred. As total cash costs per ounce of gold produced are calculated on a production basis, an inventory adjustment is made to reflect the sales margin on the portion of concentrate production not yet recognized as revenue. Other adjustments include the addition of smelting, refining and marketing charges to production costs. |
(v) |
This inventory and other adjustment reflects production costs associated with unsold concentrates. |
Reconciliation of Production Costs to All-in Sustaining Costs per Ounce of Gold Produced |
|||||||||||||
Three Months Ended |
Three Months Ended |
Six Months Ended |
Six Months Ended | ||||||||||
(United States dollars per ounce of gold produced, except where noted) |
June 30, 2016 |
June 30, 2015 |
June 30, 2016 |
June 30, 2015 | |||||||||
Production costs per the interim condensed consolidated statements of income (thousands of United States dollars) |
\\$ |
255,436 |
\\$ |
263,612 |
\\$ |
499,409 |
\\$ |
510,892 | |||||
Gold production (ounces) |
408,932 |
403,678 |
820,268 |
807,888 | |||||||||
Production costs per ounce of gold production |
\\$ |
625 |
\\$ |
653 |
\\$ |
609 |
\\$ |
632 | |||||
Adjustments: |
|||||||||||||
Inventory and other adjustments(i) |
38 |
13 |
38 |
26 | |||||||||
Total cash costs per ounce of gold produced (co-product basis)(ii) |
\\$ |
663 |
\\$ |
666 |
\\$ |
647 |
\\$ |
658 | |||||
By-product metal revenues |
(71) |
(65) |
(65) |
(63) | |||||||||
Total cash costs per ounce of gold produced (by-product basis)(ii) |
\\$ |
592 |
\\$ |
601 |
\\$ |
582 |
\\$ |
595 | |||||
Adjustments: |
|||||||||||||
Sustaining capital expenditures (including capitalized exploration) |
193 |
203 |
177 |
177 | |||||||||
General and administrative expenses (including stock options) |
60 |
58 |
60 |
60 | |||||||||
Non-cash reclamation provision and other |
3 |
2 |
3 |
3 | |||||||||
All-in sustaining costs per ounce of gold produced (by-product basis) |
\\$ |
848 |
\\$ |
864 |
\\$ |
822 |
\\$ |
835 | |||||
By-product metal revenues |
71 |
65 |
65 |
63 | |||||||||
All-in sustaining costs per ounce of gold produced (co-product basis) |
\\$ |
919 |
\\$ |
929 |
\\$ |
887 |
\\$ |
898 |
Notes: |
|
(i) |
Under the Company's revenue recognition policy, revenue is recognized on concentrates when legal title and risk is transferred. As total cash costs per ounce of gold produced are calculated on a production basis, this inventory adjustment reflects the sales margin on the portion of concentrate production not yet recognized as revenue. |
(ii) |
Total cash costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data reported by other gold producers. Total cash costs per ounce of gold produced is reported on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the interim condensed consolidated statements of income for by-product metal revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. Accordingly, the calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. The Company believes that these generally accepted industry measures provide a realistic indication of operating performance and provide useful comparison points between periods. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates. |
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