(All amounts expressed in U.S. dollars unless otherwise noted)
Stock Symbol: AEM (NYSE and TSX)
TORONTO, April 25, 2013 /PRNewswire/ - Agnico-Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico-Eagle" or the "Company") today reported quarterly net income
of $23.9 million, or $0.14 per share for the first quarter of 2013.
This result includes a non-cash foreign currency translation loss of
$3.7 million ($0.02 per share), non-cash stock option expense of $11.2
million ($0.07 per share), non-cash impairment loss on available for
sale securities of $11.0 million ($0.06 per share) and other
non-recurring expense of $3.9 million ($0.02 per share). Excluding
these items would result in adjusted net income of $53.6 million, or
$0.31 per share. In the first quarter of 2012, the Company reported
net income of $78.5 million, or $0.46 per share.
First quarter 2013 cash provided by operating activities was $146.1
million ($134.5 million before changes in non-cash components of
working capital), compared to cash provided by operating activities of $196.5 million in the first quarter
of 2012 ($181.3 million before changes in non-cash components of
working capital).
The lower net income and cash provided by operating activities in 2013
was primarily due to lower gold prices and production combined with
higher cash costs when compared to the first quarter of 2012.
"This year is a building year for Agnico-Eagle as we prepare to bring
two mines into production over the next several quarters. In the first
quarter, our operations performed in line with expectations and we
remain on track to achieve our 2013 production guidance" said Sean
Boyd, President and Chief Executive Officer. "We are also pleased to
announce that the expected startups at Goldex and La India are ahead of
schedule. Goldex is expected to commence production in the fourth
quarter of 2013, while La India is scheduled to be in commercial
production in the first quarter of 2014. These two mines are expected
to make a meaningful contribution to the growth profile of the
Company", added Mr. Boyd.
Operating highlights include:
-
First quarter 2013 production and costs in line with expectations
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Goldex initial production expected in fourth quarter 2013, ahead of
schedule and on budget - Estimated to contribute approximately 15,000 ounces of gold in 2013
-
La India anticipated to start commissioning by year-end 2013, ahead of
schedule - Construction proceeding well and on budget
-
Creston Mascota Phase Two leach pad now on line - leaching resumed at Creston Mascota in March 2013, approximately one
month ahead of schedule
-
Record quarterly throughput at Meadowbank - the mill processed a record daily average of 11,320 tonnes during the
first quarter.
-
Scheduled mill maintenance at Kittila expected to take longer than
planned - relining of autoclave expected to be complete in late June. Estimated
production impact is approximately 10,000 - 15,000 fewer ounces of gold
in 2013.
-
Total cash cost per ounce1 guidance for 2013 revised upward to reflect current commodity prices
and exchange rates - expected 2013 total cash costs to be between $735 and $785 per ounce
Payable gold production2 in the first quarter of 2013 was 236,975 ounces compared to 254,955
ounces in the first quarter of 2012. The lower level of production in
the 2013 period was primarily due to the Creston Mascota heap leach
being suspended during most of the quarter. A description of the
production and cost performance for each mine is set out further below.
Total cash costs for the first quarter of 2013 were $740 per ounce.
This compares with $594 per ounce in the first quarter of 2012. The
higher cost in 2013 was largely attributable to lower byproduct revenue
at LaRonde, lower grades at Meadowbank and a lack of production from
the lower cost Creston Mascota mine.
Agnico-Eagle's production guidance for 2013 remains unchanged at 970,000
to 1,010,000 ounces of gold, as the expected 15,000 ounce production
from Goldex offsets anticipated production decrease at Kittila related
to a longer than anticipated maintenance shutdown. The Company's cash
cost estimates have been revised to reflect the production changes at
Goldex and Kittila, as well as changes in commodity and currency price
assumptions since the beginning of 2013. New and old input assumptions
and a reconciliation of the total cash cost estimates are provided
below:
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Commodity and currency price assumptions
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Feb 13, 2013
press release
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Apr 25, 2013
press release
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Silver price per ounce
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$34
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$25
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Copper price per metric tonne
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$7,500
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$7,000
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Zinc price per metric tonne
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$2,000
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$1,900
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CAD per USD
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1.00
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1.03
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USD per EURO
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1.30
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1.29
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MXP per USD
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13.00
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12.25
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Reconciliation of total cash costs estimates
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2013 Total Cash Cost Per Ounce Estimate (as per Feb 13, 2013 release)
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$ 700 - $ 750
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Change in Silver price assumptions
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$ 29
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Change in Copper price assumptions
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$ 4
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Change in Zinc price assumptions
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$ 4
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Change in CAD per USD assumptions
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($19)
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Change in USD per EURO assumptions
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($1)
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Change in MXP per USD assumptions
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$3
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Changes in Kittila production estimates
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$10
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Introduction of Goldex into total production profile
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$5
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Revised 2013 Total Cash Cost Per Ounce Estimate
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$ 735 - $ 785
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As noted in the year-end 2012 results (see February 13, 2013 news
release), the 2013 production is expected to be higher in the second
half of the year due to resumption of production at Kittila, increased
production at Creston Mascota, the ongoing ramp up of production at
LaRonde, higher expected grades at Meadowbank, and the start of
production at Goldex. For the full year 2013, the all-in sustaining
costs3 are now expected to be approximately $1,110 per ounce at current metals
prices and exchange rates.
First Quarter 2013 Results Conference Call and Webcast Tomorrow
The Company's senior management will host a conference call on Friday,
April 26, 2013 at 9:00 AM (E.D.T.) to discuss financial results and
provide an update of the Company's operating activities.
Via Webcast:
A live audio webcast of the meeting will be available on the Company's
website homepage at www.agnicoeagle.com.
Via Telephone:
For those preferring to listen by telephone, please dial 416-644-3414 or
Toll-free 1-800-814-4859. To ensure your participation, please call
approximately five minutes prior to the scheduled start of the call.
Replay archive:
Please dial 416-640-1917 or Toll-free 1-877-289-8525, access code
4568953#.
The conference call replay will expire on May 26, 2013.
The webcast along with presentation slides will be archived for 180 days on the website.
Annual and Special General Meeting ("AGM")
The AGM will begin on Friday, April 26, 2013 at 11:00am (E.D.T). The
meeting will be held at the Sheraton Centre Hotel (Dominion Ballroom)
located at 123 Queen Street West, Toronto, ON. For those unable to
attend in person, the meeting will be accessible on the internet or by
telephone, as set out below.
Via Webcast:
A live audio webcast of the meeting will be available on the Company's
website homepage at www.agnicoeagle.com.
Via Telephone:
For those preferring to listen by telephone, please dial 416-644-3415 or
Toll-free 1-877-974-0445. To ensure your participation, please call
approximately five minutes prior to the scheduled start of the call.
Replay archive:
Please dial 416-640-1917 or Toll-free 1-877-289-8525, access code
4611168#.
The AGM conference call replay will expire on June 26, 2013.
The AGM webcast along with presentation slides will be archived for 180
days on the website.
Cash Position Remains Strong
Cash and cash equivalents totaled $264 million at March 31, 2013, down
from the December 31, 2012 balance of $332 million. The decline in the
cash balance is largely due to lower metal prices and repayment of the
Company's bank credit facility. The outstanding balance on the credit
facility was reduced from $30 million at December 31, 2012 to nil at
March 31, 2013.
Capital expenditures in the first quarter of 2013 were $131 million,
including $25 million at LaRonde, $18 million at Meadowbank, $7 million
at Kittila, $7 million at Pinos Altos, $5 million at Lapa, and $2
million at Creston Mascota. Capital expenditures at development
projects included $37 million at La India, $17 million at Goldex, and
$12 million at Meliadine.
In 2013, capital expenditures are now expected to be $621 million,
reflecting an accelerated schedule at both Goldex and La India. The
increases in the capital expenditures budget include $27 million at La
India and $5 million at Goldex that were previously budgeted for 2014,
as well as a decrease of $7 million reflecting changes in foreign
exchange rates. The previous estimate of 2013 capital expenditures was
$596 million (see February 13, 2013 press release).
With its current cash balances, anticipated cash flows and available
bank lines, management believes that Agnico-Eagle remains fully funded
for the development and exploration of its current pipeline of approved
gold projects in Canada, Finland and Mexico.
Available bank lines as of March 31, 2013 were approximately $1.2
billion.
LaRonde - Work on Cooling Plant Continues as Planned
The 100% owned LaRonde mine in northwestern Quebec, Canada, began
operation in 1988. Current mine life is estimated to be through 2026.
The LaRonde mill processed an average of 6,603 tonnes per day ("tpd") in
the first quarter of 2013, compared with an average of 7,087 tpd in the
corresponding period of 2012. The lower mill throughput in the current
period was largely due to heat and congestion challenges as the deeper
levels of the mine continue to be developed. Increased ventilation and
cooling plant infrastructure are expected to be installed in the fourth
quarter of 2013, which should provide additional mining flexibility.
In the first quarter of 2013, approximately 60% of the ore milled came
from the deeper portion of the LaRonde mine. The proportion of
production from the deeper mine ore is expected to increase over the
course of the year as two higher grade deep pyramids are mined. The
mined grade is expected to continue to increase towards the average
reserve grade over the next several years.
Minesite costs per tonne4 were on budget at approximately C$98 in the first quarter of 2013.
These costs are higher than the C$90 per tonne experienced in the first
quarter of 2012. The increase in costs is largely due to the continued
transition to mining the deeper ore at LaRonde.
On a per ounce basis, net of byproduct credits, LaRonde's total cash
costs per ounce were $718 in the first quarter of 2013 on production of
39,073 ounces of gold. This compares with the first quarter of 2012
when total cash costs per ounce were $216 on production of 43,281
ounces of gold. The increase in total cash costs was mainly due to
lower byproduct metal production (as the mine transitions to more
gold-rich ore at depth) and minesite costs per tonne, as previously
mentioned. Silver, copper and zinc production in the first quarter of
2013 was 11%, 18% and 37% lower, respectively, compared to the first
quarter of 2012.
After 2013, LaRonde is expected to ramp up production over the next
several years to an average life of mine production of more than
300,000 ounces of gold per year, reflecting the higher gold grades
expected at depth. As a result of the higher grades, the value of the
ore expected to be processed over LaRonde's remaining 15-year life is
approximately 50% higher than the value of the ore mined in 2012
(assuming the same metals prices).
Lapa - Continued Steady Performance
The 100% owned Lapa mine in northwestern Quebec achieved commercial
production in May 2009. Current mine life is estimated to be through
2015.
The Lapa circuit at the LaRonde mill processed an average of 1,778 tpd
in the first quarter of 2013. This compares with an average of 1,738
tpd in the first quarter of 2012.
Minesite costs per tonne were C$115 in the first quarter of 2013,
compared to C$120 in the first quarter of 2012. The lower minesite
cost this quarter is due to improved maintenance and equipment
availability, slightly lower development costs and lower milling costs
versus the comparable period last year.
Payable production in the first quarter of 2013 was 26,868 ounces of
gold at total cash costs per ounce of $680. This compares with the
first quarter of 2012, when production was 28,499 ounces of gold at
total cash cost per ounce of $664. In the current period, the decrease
in gold production and higher total cash costs per ounce are generally
due to the processing of lower gold grades compared to the same quarter
last year.
Kittila Mine - Scheduled Mill Maintenance Extended
The 100% owned Kittila mine in northern Finland achieved commercial
production in May 2009. Current mine life is estimated to be through
2044.
The Kittila mill processed an average of approximately 2,966 tpd in the
first quarter of 2013. In the first quarter of 2012, the Kittila mill
processed 3,180 tpd. Throughput for the 2013 period was lower due to a
slight increase of scheduled maintenance time compared to the prior
year period.
Minesite costs per tonne at Kittila were approximately €77 in the first
quarter of 2013, below budget, compared to €67 in the first quarter of
2012. The increase in budgeted minesite costs is largely due to the
mine now processing ore entirely from the relatively higher cost
underground areas (the open pit areas were depleted in the fourth
quarter of 2012).
First quarter 2013 gold production at Kittila was 43,145 ounces with a
total cash cost per ounce of $624. In the first quarter of 2012 the
mine produced 46,758 ounces at total cash costs per ounce of $565.
Kittila achieved record quarterly gold recoveries of 91.6% in the
quarter. Lower production and higher costs in the 2013 period were
largely the result of slightly lower throughput and grades, and higher
minesite costs compared to the first quarter of 2012.
During the second quarter of 2013, the Kittila mill was scheduled to
undergo a planned 40-day maintenance shutdown. Upon commencement of
the shutdown, a comprehensive assessment of the autoclave determined
that additional maintenance was required, including a complete relining
of all layers inside the autoclave. As a result, the autoclave is
expected to resume operation late in the second quarter. The Company
estimates that the extended shutdown will result in a reduction of
approximately 10,000 - 15,000 ounces of gold in 2013. The impact of
the shutdown on total cash costs per pounce is expected to be
approximately $10 per ounce, as disclosed above.
In February 2013, the Company's Board of Directors approved a 750 tpd
expansion at Kittila, which is expected to increase the capacity at the
mine to 3,750 tpd starting in the second half of 2015. The total
expenditure on the project is estimated to be about $103 million over a
three year period, with $25 million expected to be spent in 2013. To
date, the Engineering, Procurement, and Construction Management
contract has been awarded, detailed engineering has commenced and the
procurement of long lead items is underway. The expansion is expected
to reduce total cash costs per ounce and to offset the production
impact of a gradual reduction in realized grade towards the reserve
grade over the next several years.
Given the recent exploration success at Kittila (especially on the Rimpi
zone), a study is underway that is evaluating the possible installation
of a production shaft and second autoclave at Kittila. These
facilities are anticipated to result in operating flexibility and costs
savings and sustain long-term production at higher throughput levels
from multiple zones, especially at depths below 700 metres. Results of
this study are expected to be available in 2014.
Pinos Altos - Creston Mascota Leaching Resumes Ahead of Schedule
The 100% owned Pinos Altos mine in northern Mexico achieved commercial
production in November 2009. Current mine life is estimated to be
through 2029.
The Pinos Altos mill processed an average of 5,250 tpd in the first
quarter of 2013. This compares with 4,967 tonnes per day processed in
the first quarter of 2012. The increase is largely due to higher
mechanical availability.
Approximately 484,000 tonnes of ore were stacked on the Pinos Altos and
Creston Mascota leach pads during the first quarter of 2013. In the
first quarter of 2012, approximately 782,000 tonnes were stacked on the
leach pads. The decrease in tonnes stacked was mainly a result of the
temporary suspension of activities at the Creston Mascota mine.
Leaching resumed on the Phase 2 pad at Creston Mascota in March 2013,
which was approximately one month ahead of schedule. A gradual ramp-up
of production at Creston Mascota is expected to occur over the course
of the year.
Minesite costs per tonne at Pinos Altos (excluding Creston Mascota) were
$41 in the first quarter of 2013, compared to $37 in the first quarter
of 2012. The slight increase in minesite costs per tonne over the
prior year period is primarily due to a higher proportion of milled ore
in the 2013 period.
Payable production in the first quarter of 2013 was 46,071 ounces of
gold (including 1,907 ounces from Creston Mascota) at total cash costs
per ounce of $3005. This compares with production of 57,016 ounces (including 13,724
ounces from Creston Mascota) at a total cash cost of $278 in the first
quarter of 2012.
The higher production and lower cash cost per ounce in the 2012 period
was largely due to the full quarter contribution from Creston Mascota
and higher silver prices compared to the 2013 period.
The Pinos Altos shaft sinking project achieved several milestones during
the quarter including the completion of the raise bore pilot hole,
concrete pours for the head frame, and the initial mobilization of the
contractor and the first blasts in the shaft.
This project will allow better matching of the mill capacity with the
future mining capacity at Pinos Altos when the open pit mining
operation begins to wind down as planned in the next several years.
Meadowbank - Record Quarterly Mill Throughput
The 100% owned Meadowbank mine is located in Nunavut, Canada. Current
mine life is estimated to be through 2018.
The Meadowbank mill processed an average of 11,320 tpd in the first
quarter of 2013. This compares with 9,748 tpd in the first quarter of
2012. The higher throughput, period over period, is largely due to the
continued strong operating performance of the permanent secondary
crushing unit that was commissioned in July 2011. The secondary
crusher has consistently exceeded the initial design rate of 8,500 tpd
since startup.
Minesite costs per tonne were C$87 in the first quarter of 2013,
compared with C$92 per tonne in the first quarter of 2012. Costs are
lower in the 2013 period due to more tonnes of ore processed in 2013
versus 2012, and overall improved productivity.
Payable production in the first quarter of 2013 was 81,818 ounces of
gold at total cash costs per ounce of $1,069. This compares with
payable production in the first quarter of 2012 of 79,401 ounces of
gold at total cash costs per ounce of $1,020. The improvement in
production in the first quarter of 2013 was largely due to increased
throughput, which was partly offset by slightly lower grades and
recoveries. Costs for the current period increased mainly due to mining
and processing of lower grade ore.
Production at Meadowbank is expected to be higher in the second half of
2013 based on higher anticipated grades.
Goldex Mine - Expected To Commence Production In Fourth Quarter 2013
The 100% owned Goldex mine in northwestern Quebec began operation in
2008 but mining in the original GEZ orebody was suspended in October
2011 (see October 19, 2011 press release). In 2012, the M and E
satellite zones were approved for construction, while the GEZ remains
suspended.
Development activities at the mine have advanced ahead of schedule,
resulting in anticipated commencement of production in the fourth
quarter of 2013, approximately two quarters ahead of previous
estimates. Gold production during 2013 is expected to be approximately
15,000 ounces at relatively high total cash costs of approximately
$1,130 per ounce, reflecting the startup of production.
Underground development is ongoing, and construction of the paste plant
is proceeding as planned with about half of the main structure
completed. Given the advanced ramp up, approximately $5 million of
capital expenditures that were previously planned for 2014 have been
included in the revised 2013 capital budget.
In addition, drilling and technical studies are underway on a number of
other satellite zones at the mine, with results expected by the end of
2013.
La India - Development on Budget and Ahead of Schedule; Commissioning to
start by year-end 2013
The La India project in Sonora, Mexico, was acquired in November 2011.
Given the steady progress being made during the mine construction
phase, the Company now anticipates commissioning La India late in the
fourth quarter of 2013, with commercial production anticipated in the
first quarter 2014. Previous guidance had suggested start up in the
second quarter of 2014.
With the advancement of expected commissioning, approximately $27
million of capital costs have been brought into the 2013 budget from
planned expenditures in 2014.
Results from infill drilling on the La India and Main zones indicated
conformity with the current block models. Metallurgical testing
continues on the La India sulphides and Tarachi ores, with results
expected later this year.
Meliadine - Permitting Continues and Road Construction Progressing Well
Located near Rankin Inlet, Nunavut, Canada, the Meliadine project was
acquired in July 2010, and is one of Agnico-Eagle's largest gold
projects in terms of resources. Approximately $90 million is expected
to be spent on Meliadine exploration, permitting and infrastructure in
2013. The main focus of the exploration program is resource to reserve
conversion drilling on the main deposit areas, which will be reflected
in an updated technical study that should be completed in the second
quarter of 2014.
Permitting activities are on-going with first production anticipated in
2018 and capital expenditures expected to be distributed over the 2013
to 2018 period, subject to board approval and prevailing market
conditions.
Construction is continuing on the permanent all-season road linking the
project with the community of Rankin Inlet, 24 kilometres away. The
road was connected to the Meliadine camp in March and is functional,
with full completion expected later this summer.
Investment Activity - Re-aligning The Equity Portfolio
Consistent with the long standing approach of investing in
development/exploration stage companies, Agnico-Eagle has made several
recent equity investments. In all cases, Agnico-Eagle acquired the
shares for investment purposes. These acquisitions are part of the
Company's ongoing strategy to maintain a focused, streamlined portfolio
of strategic investments in promising junior mining companies.
Dividend Record and Payment Dates for the Second Quarter of 2013
The Board of Directors of the Company has approved the payment of a
quarterly cash dividend of $0.22 per common share. The next of these
dividends will be paid on June 15, 2013 to shareholders of record as of
June 3, 2013.
Other Expected Dividend and Record Dates for 2013
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Record Date
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Payment Date
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Sept. 3
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Sept. 17
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Dec. 2
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Dec. 16
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Dividend Reinvestment Program
Please follow the link below for information on the Company's dividend
reinvestment program.
Dividend Reinvestment Plan
About Agnico-Eagle
Agnico-Eagle is a long established, Canadian headquartered, gold
producer with operations located in Canada, Finland and Mexico, and
exploration and/or development activities in Canada, Finland, Mexico
and the United States. The Company has full exposure to higher gold
prices consistent with its policy of no forward gold sales and
maintains a corporate strategy based on increasing shareholder exposure
to gold, on a per share basis. It has declared a cash dividend for 31
consecutive years.
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AGNICO-EAGLE MINES LIMITED
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SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS
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(thousands of United States dollars, US GAAP basis, except where noted)
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(Unaudited)
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Three months ended
March 31,
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2013
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2012
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Operating margin by mine (Note 1):
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LaRonde mine
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$33,295
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$63,266
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Lapa mine
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21,788
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27,677
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Kittila mine
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44,956
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49,049
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Pinos Altos mine (Note 2)
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53,827
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69,135
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Meadowbank mine
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36,503
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48,772
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Total operating margin
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190,369
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257,899
|
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Amortization of property, plant and mine development
|
70,071
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64,553
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Exploration, corporate and other
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71,690
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|
85,836
|
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Income before income and mining taxes
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48,608
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|
107,510
|
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Income and mining taxes
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24,749
|
|
28,962
|
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Net income for the period
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$23,859
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|
$78,548
|
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Net income per share - basic (US$)
|
$0.14
|
|
$0.46
|
|
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|
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Cash provided by operating activities
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$146,072
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$196,497
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Realized prices(US$):
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Gold (per ounce)
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$1,611
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$1,684
|
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Silver (per ounce)
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$28.70
|
|
$34.46
|
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Zinc (per tonne)
|
$2,002
|
|
$2,125
|
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Copper (per tonne)
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$7,570
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|
$9,006
|
|
|
|
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Payable production (Note 3):
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Gold (ounces):
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|
|
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LaRonde mine
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39,073
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43,281
|
|
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Lapa mine
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26,868
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28,499
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Kittila mine
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43,145
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46,758
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Pinos Altos mine (Note 2)
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46,071
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57,016
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Meadowbank mine
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81,818
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79,401
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Total gold (ounces)
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236,975
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|
254,955
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Silver (thousands of ounces):
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|
|
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LaRonde mine
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611
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690
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Kittila mine
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2
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-
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Pinos Altos mine (Note 2)
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616
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|
507
|
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Meadowbank mine
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22
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|
18
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|
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Total silver (thousands of ounces)
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1,251
|
|
1,215
|
|
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Zinc (tonnes)
|
8,239
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|
12,978
|
|
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Copper (tonnes)
|
1,082
|
|
1,326
|
|
|
|
|
|
|
Payable metal sold:
|
|
|
|
|
|
Gold (ounces):
|
|
|
|
|
|
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LaRonde mine
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39,588
|
|
43,745
|
|
|
|
Lapa mine
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23,939
|
|
27,897
|
|
|
|
Kittila mine
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44,340
|
|
44,227
|
|
|
|
Pinos Altos mine (Note 2)
|
45,110
|
|
52,145
|
|
|
|
Meadowbank mine
|
80,012
|
|
74,614
|
|
|
Total gold (ounces)
|
232,989
|
|
242,628
|
|
|
Silver (thousands of ounces):
|
|
|
|
|
|
|
LaRonde mine
|
583
|
|
718
|
|
|
|
Kittila mine
|
1
|
|
-
|
|
|
|
Pinos Altos mine (Note 2)
|
586
|
|
493
|
|
|
|
Meadowbank mine
|
22
|
|
18
|
|
|
Total silver (thousands of ounces)
|
1,192
|
|
1,229
|
|
|
Zinc (tonnes)
|
6,999
|
|
13,032
|
|
|
Copper (tonnes)
|
1,067
|
|
1,293
|
|
|
|
|
|
|
Total cash costs per ounce of gold produced (US$) (Note 4):
|
|
|
|
|
LaRonde mine
|
$718
|
|
$216
|
|
Lapa mine
|
$680
|
|
$664
|
|
Kittila mine
|
$624
|
|
$565
|
|
Pinos Altos mine (Note 2)
|
$300
|
|
$278
|
|
Meadowbank mine
|
$1,069
|
|
$1,020
|
|
Weighted average total cash costs per ounce of gold produced
|
$740
|
|
$594
|
|
|
|
|
|
Note 1
Operating margin by mine is calculated as revenues from mining
operations less production costs.
Note 2
Includes the Creston Mascota deposit at Pinos Altos, except for total
cash costs per ounce of gold produced in the first quarter of 2013.
Note 3
Payable production 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 inventory at the
end of the period.
Note 4
Total cash costs per ounce of gold produced is calculated net of silver,
copper, zinc and other byproduct revenue credits. The weighted average
total cash costs per ounce of gold produced is based on commercial
production ounces. Total cash costs per ounce of gold produced is a
non-GAAP measure that the Company uses to monitor the performance of
its operations. See "reconciliation of production costs to total cash
costs per ounce of gold produced and minesite costs per tonne"
contained herein for details.
|
AGNICO-EAGLE MINES LIMITED
|
|
CONSOLIDATED BALANCE SHEETS
|
|
(thousands of United States dollars, US GAAP basis)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
As at
March 31, 2013
|
|
As at
December 31, 2012
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
$
|
264,395
|
|
|
$
|
332,008
|
|
|
|
Trade receivables
|
|
70,526
|
|
|
|
67,750
|
|
|
|
Inventories:
|
|
|
|
|
|
|
|
|
|
|
Ore stockpiles
|
|
61,325
|
|
|
|
52,342
|
|
|
|
|
Concentrates and dore bars
|
|
68,312
|
|
|
|
69,695
|
|
|
|
|
Supplies
|
|
191,479
|
|
|
|
222,630
|
|
|
|
Income taxes recoverable
|
|
27,077
|
|
|
|
19,313
|
|
|
|
Available-for-sale securities
|
|
55,309
|
|
|
|
44,719
|
|
|
|
Fair value of derivative financial instruments
|
|
5,308
|
|
|
|
2,112
|
|
|
|
Other current assets
|
|
97,988
|
|
|
|
92,977
|
|
|
Total current assets
|
|
841,719
|
|
|
|
903,546
|
|
|
Other assets
|
|
50,685
|
|
|
|
55,838
|
|
|
Goodwill
|
|
229,279
|
|
|
|
229,279
|
|
|
Property, plant and mine development
|
|
4,129,137
|
|
|
|
4,067,456
|
|
|
|
$
|
5,250,820
|
|
|
$
|
5,256,119
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
$
|
177,898
|
|
|
$
|
185,329
|
|
|
|
Reclamation provision
|
|
14,158
|
|
|
|
16,816
|
|
|
|
Dividends payable
|
|
-
|
|
|
|
37,905
|
|
|
|
Interest payable
|
|
20,877
|
|
|
|
13,602
|
|
|
|
Income taxes payable
|
|
13,917
|
|
|
|
10,061
|
|
|
|
Capital lease obligations
|
|
11,347
|
|
|
|
12,955
|
|
|
|
Fair value of derivative financial instruments
|
|
700
|
|
|
|
277
|
|
|
Total current liabilities
|
|
238,897
|
|
|
|
276,945
|
|
|
Long-term debt
|
|
800,000
|
|
|
|
830,000
|
|
|
Reclamation provision and other liabilities
|
|
125,289
|
|
|
|
127,735
|
|
|
Deferred income and mining tax liabilities
|
|
623,253
|
|
|
|
611,227
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Common shares
|
|
|
|
|
|
|
|
|
|
Authorized - unlimited
|
|
|
|
|
|
|
|
|
|
Issued - 172,867,524 (December 31, 2012 - 172,296,610)
|
|
3,249,744
|
|
|
|
3,241,922
|
|
|
Stock options
|
|
158,437
|
|
|
|
148,032
|
|
|
Warrants
|
|
24,858
|
|
|
|
24,858
|
|
|
Contributed surplus
|
|
15,665
|
|
|
|
15,665
|
|
|
Retained earnings
|
|
31,000
|
|
|
|
7,046
|
|
|
Accumulated other comprehensive loss
|
|
(16,323)
|
|
|
|
(27,311)
|
|
|
Total shareholders' equity
|
|
3,463,381
|
|
|
|
3,410,212
|
|
|
|
$
|
5,250,820
|
|
|
$
|
5,256,119
|
|
|
|
|
|
|
|
|
|
|
|
AGNICO-EAGLE MINES LIMITED
|
|
CONSOLIDATED STATEMENTS OF INCOME
|
|
(thousands of United States dollars, except share and per share amounts,
US GAAP basis)
|
|
(Unaudited)
|
|
|
|
|
|
|
Three months ended
March 31,
|
|
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
|
|
|
|
|
|
Revenues from mining operations
|
|
$
|
420,422
|
|
$
|
472,934
|
|
Interest and sundry income and other
|
|
|
2,770
|
|
|
1,164
|
|
|
|
|
423,192
|
|
|
474,098
|
|
|
|
|
|
|
|
|
|
COSTS AND EXPENSES
|
|
|
|
|
|
|
|
Production
|
|
|
230,053
|
|
|
215,035
|
|
Exploration and corporate development
|
|
|
8,571
|
|
|
23,108
|
|
Amortization of property, plant and mine development
|
|
|
70,071
|
|
|
64,553
|
|
General and administrative
|
|
|
37,320
|
|
|
33,928
|
|
Impairment loss on available-for-sale securities
|
|
|
10,995
|
|
|
-
|
|
Interest expense
|
|
|
13,916
|
|
|
14,447
|
|
Foreign currency translation loss
|
|
|
3,658
|
|
|
15,517
|
|
Income before income and mining taxes
|
|
|
48,608
|
|
|
107,510
|
|
Income and mining taxes
|
|
|
24,749
|
|
|
28,962
|
|
Net income for the period
|
|
$
|
23,859
|
|
$
|
78,548
|
|
|
|
|
|
|
|
|
|
Net income per share - basic
|
|
$
|
0.14
|
|
$
|
0.46
|
|
Net income per share - diluted
|
|
$
|
0.14
|
|
$
|
0.46
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
Basic
|
|
|
172,280
|
|
|
170,837
|
|
Diluted
|
|
|
172,623
|
|
|
171,017
|
|
AGNICO-EAGLE MINES LIMITED
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(thousands of United States dollars, US GAAP basis)
|
|
(Unaudited)
|
|
|
|
|
|
Three months ended
March 31,
|
|
|
|
|
2013
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
Net income for the period
|
|
$
|
23,859
|
|
$
|
78,548
|
|
Add (deduct) items not affecting cash:
|
|
|
|
|
|
|
|
|
Amortization of property, plant and mine development
|
|
|
70,071
|
|
|
64,553
|
|
|
Deferred income and mining taxes
|
|
|
7,026
|
|
|
10,320
|
|
|
Stock-based compensation, foreign currency translation and other
|
|
|
36,061
|
|
|
34,088
|
|
Adjustment for settlement of environmental remediation
|
|
|
(2,552)
|
|
|
(6,232)
|
|
Changes in non-cash working capital balances:
|
|
|
|
|
|
|
|
|
Trade receivables
|
|
|
(2,776)
|
|
|
(14,993)
|
|
|
Income taxes
|
|
|
(3,908)
|
|
|
19,869
|
|
|
Inventories
|
|
|
27,992
|
|
|
11,549
|
|
|
Other current assets
|
|
|
(5,765)
|
|
|
18,810
|
|
|
Accounts payable and accrued liabilities
|
|
|
(10,102)
|
|
|
(29,852)
|
|
|
Interest payable
|
|
|
6,166
|
|
|
9,837
|
|
Cash provided by operating activities
|
|
|
146,072
|
|
|
196,497
|
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
Additions to property, plant and mine development
|
|
|
(130,634)
|
|
|
(75,995)
|
|
Acquisitions, investments and other
|
|
|
(12,675)
|
|
|
(11,325)
|
|
Cash used in investing activities
|
|
|
(143,309)
|
|
|
(87,320)
|
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
Dividends paid
|
|
|
(29,890)
|
|
|
(30,515)
|
|
Repayment of capital lease obligations
|
|
|
(2,553)
|
|
|
(3,112)
|
|
Proceeds from long-term debt
|
|
|
40,000
|
|
|
-
|
|
Repayment of long-term debt
|
|
|
(70,000)
|
|
|
(90,000)
|
|
Repurchase of common shares for restricted share unit plan
|
|
|
(19,000)
|
|
|
(12,031)
|
|
Common shares issued
|
|
|
11,939
|
|
|
3,580
|
|
Cash used in financing activities
|
|
|
(69,504)
|
|
|
(132,078)
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
(872)
|
|
|
518
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents during the period
|
|
|
(67,613)
|
|
|
(22,383)
|
|
Cash and cash equivalents, beginning of period
|
|
|
332,008
|
|
|
221,458
|
|
Cash and cash equivalents, end of period
|
|
$
|
264,395
|
|
$
|
199,075
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information:
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
6,832
|
|
$
|
4,093
|
|
Income and mining taxes paid
|
|
$
|
21,633
|
|
$
|
4,305
|
|
AGNICO-EAGLE MINES LIMITED
|
|
RECONCILIATION OF PRODUCTION COSTS TO TOTAL CASH COSTS
|
|
PER OUNCE OF GOLD PRODUCED AND MINESITE COSTS PER TONNE
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Total Production Costs by Mine
|
|
|
|
|
|
|
|
Three months ended
|
|
Three months ended
|
|
|
March 31, 2013
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars)
|
|
Production costs per consolidated statements of income and
|
|
|
|
|
|
|
|
comprehensive income
|
|
$
|
230,053
|
|
$
|
215,035
|
|
LaRonde mine
|
|
|
57,903
|
|
|
58,180
|
|
Lapa mine
|
|
|
16,610
|
|
|
18,657
|
|
Kittila mine
|
|
|
27,182
|
|
|
26,030
|
|
Pinos Altos(i)
|
|
|
31,652
|
|
|
35,161
|
|
Meadowbank mine
|
|
|
93,589
|
|
|
77,007
|
|
Total
|
|
$
|
226,936
|
|
$
|
215,035
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Production Costs to Total Cash Costs per Ounce of Gold
Produced by Mine
|
|
|
|
|
|
|
|
|
|
LaRonde Mine - Total Cash Costs per Ounce of Gold Produced
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
57,903
|
|
$
|
58,180
|
|
Adjustments:
|
|
|
|
|
|
|
|
Byproduct metal revenues, net smelting, refining and marketing charges
|
|
|
(29,556)
|
|
|
(47,518)
|
|
Inventory and other adjustments(ii)
|
|
|
262
|
|
|
(715)
|
|
Non-cash reclamation provision
|
|
|
(542)
|
|
|
(604)
|
|
Cash operating costs
|
|
$
|
28,067
|
|
$
|
9,343
|
|
Gold production (ounces)
|
|
|
39,073
|
|
|
43,281
|
|
Total cash costs per ounce of gold produced ($ per ounce)(iii)
|
|
$
|
718
|
|
$
|
216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lapa Mine - Total Cash Costs per Ounce of Gold Produced
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
16,610
|
|
$
|
18,657
|
|
Adjustments:
|
|
|
|
|
|
|
|
Byproduct metal revenues, net smelting, refining and marketing charges
|
|
|
77
|
|
|
61
|
|
Inventory and other adjustments(ii)
|
|
|
1,610
|
|
|
(17)
|
|
Non-cash reclamation provision
|
|
|
(17)
|
|
|
236
|
|
Cash operating costs
|
|
$
|
18,280
|
|
$
|
18,937
|
|
Gold production (ounces)
|
|
|
26,868
|
|
|
28,499
|
|
Total cash costs per ounce of gold produced ($ per ounce)(iii)
|
|
$
|
680
|
|
$
|
664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kittila Mine - Total Cash Costs per Ounce of Gold Produced
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
27,182
|
|
$
|
26,030
|
|
Adjustments:
|
|
|
|
|
|
|
|
Byproduct metal revenues, net smelting, refining and marketing charges
|
|
|
157
|
|
|
119
|
|
Inventory and other adjustments(ii)
|
|
|
(294)
|
|
|
440
|
|
Non-cash reclamation provision
|
|
|
(120)
|
|
|
(157)
|
|
Cash operating costs
|
|
$
|
26,925
|
|
$
|
26,432
|
|
Gold production (ounces)
|
|
|
43,145
|
|
|
46,758
|
|
Total cash costs per ounce of gold produced ($ per ounce)(iii)
|
|
$
|
624
|
|
$
|
565
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pinos Altos Mine - Total Cash Costs per Ounce of Gold Produced(i)
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
31,652
|
|
$
|
35,161
|
|
Adjustments:
|
|
|
|
|
|
|
|
Byproduct metal revenues, net smelting, refining and marketing charges
|
|
|
(16,566)
|
|
|
(16,449)
|
|
Inventory and other adjustments(ii)
|
|
|
(430)
|
|
|
1,754
|
|
Non-cash reclamation provision
|
|
|
(74)
|
|
|
(433)
|
|
Stripping costs(iv)
|
|
|
(1,319)
|
|
|
(4,180)
|
|
Cash operating costs
|
|
$
|
13,263
|
|
$
|
15,853
|
|
Gold production (ounces)
|
|
|
44,164
|
|
|
57,016
|
|
Total cash costs per ounce of gold produced ($ per ounce)(iii)
|
|
$
|
300
|
|
$
|
278
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Meadowbank Mine - Total Cash Costs per Ounce of Gold Produced
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
93,589
|
|
$
|
77,007
|
|
Adjustments:
|
|
|
|
|
|
|
|
Byproduct metal revenues, net smelting, refining and marketing charges
|
|
|
(563)
|
|
|
(634)
|
|
Inventory and other adjustments(ii)
|
|
|
992
|
|
|
5,254
|
|
Non-cash reclamation provision
|
|
|
(393)
|
|
|
(394)
|
|
Stripping costs(iv)
|
|
|
(6,124)
|
|
|
(222)
|
|
Cash operating costs
|
|
$
|
87,501
|
|
$
|
81,011
|
|
Gold production (ounces)
|
|
|
81,818
|
|
|
79,401
|
|
Total cash costs per ounce of gold produced ($ per ounce)(iii)
|
|
$
|
1,069
|
|
$
|
1,020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Production Costs to Minesite Costs per Tonne by Mine
|
|
|
|
|
|
|
|
|
|
LaRonde Mine - Minesite Costs per Tonne
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
57,903
|
|
$
|
58,180
|
|
Adjustments:
|
|
|
|
|
|
|
|
Inventory adjustment(v)
|
|
|
434
|
|
|
(125)
|
|
Non-cash reclamation provision
|
|
|
(542)
|
|
|
(604)
|
|
Minesite operating costs
|
|
$
|
57,795
|
|
$
|
57,451
|
|
Minesite operating costs (thousands of C$)
|
|
$
|
58,420
|
|
$
|
57,730
|
|
Tonnes of ore milled (thousands of tonnes)
|
|
|
594
|
|
|
645
|
|
Minesite cost per tonne (C$)(vi)
|
|
$
|
98
|
|
$
|
90
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lapa Mine - Minesite Costs per Tonne
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
16,610
|
|
$
|
18,657
|
|
Adjustments:
|
|
|
|
|
|
|
|
Inventory adjustment(v)
|
|
|
1,671
|
|
|
20
|
|
Non-cash reclamation provision
|
|
|
(17)
|
|
|
236
|
|
Minesite operating costs
|
|
$
|
18,264
|
|
$
|
18,913
|
|
Minesite operating costs (thousands of C$)
|
|
$
|
18,445
|
|
$
|
18,904
|
|
Tonnes of ore milled (thousands of tonnes)
|
|
|
160
|
|
|
158
|
|
Minesite cost per tonne (C$)(vi)
|
|
$
|
115
|
|
$
|
120
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kittila Mine - Minesite Costs per Tonne
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
27,182
|
|
$
|
26,030
|
|
Adjustments:
|
|
|
|
|
|
|
|
Inventory adjustment(v)
|
|
|
(294)
|
|
|
440
|
|
Non-cash reclamation provision
|
|
|
(120)
|
|
|
(157)
|
|
Minesite operating costs
|
|
$
|
26,768
|
|
$
|
26,313
|
|
Minesite operating costs (thousands of €)
|
|
€
|
20,580
|
|
€
|
19,458
|
|
Tonnes of ore milled (thousands of tonnes)
|
|
|
267
|
|
|
289
|
|
Minesite cost per tonne (€)(vi)
|
|
€
|
77
|
|
€
|
67
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pinos Altos Mine - Minesite Costs per Tonne(i)
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
31,652
|
|
$
|
35,161
|
|
Adjustments:
|
|
|
|
|
|
|
|
Inventory adjustment(v)
|
|
|
(403)
|
|
|
1,754
|
|
Non-cash reclamation provision
|
|
|
(74)
|
|
|
(433)
|
|
Stripping costs(iv)
|
|
|
(1,319)
|
|
|
(4,180)
|
|
Minesite operating costs
|
|
$
|
29,856
|
|
$
|
32,302
|
|
Tonnes of ore milled (thousands of tonnes)
|
|
|
726
|
|
|
1,234
|
|
Minesite cost per tonne(vi)
|
|
$
|
41
|
|
$
|
26
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Meadowbank Mine - Minesite Costs per Tonne
|
|
|
Three months ended
|
|
|
Three months ended
|
|
|
|
March 31, 2013
|
|
|
March 31, 2012
|
|
|
|
(thousands of United States dollars, except as noted)
|
|
Production costs
|
|
$
|
93,589
|
|
$
|
77,007
|
|
Adjustments:
|
|
|
|
|
|
|
|
Inventory adjustment(v)
|
|
|
902
|
|
|
5,429
|
|
Non-cash reclamation provision
|
|
|
(393)
|
|
|
(394)
|
|
Stripping costs(iv)
|
|
|
(6,124)
|
|
|
(222)
|
|
Minesite operating costs
|
|
$
|
87,974
|
|
$
|
81,820
|
|
Minesite operating costs (thousands of C$)
|
|
$
|
88,601
|
|
$
|
81,730
|
|
Tonnes of ore milled (thousands of tonnes)
|
|
|
1,019
|
|
|
887
|
|
Minesite cost per tonne (C$)(vi)
|
|
$
|
87
|
|
$
|
92
|
|
(i)
|
Includes the Creston Mascota deposit at Pinos Altos for the first
quarter of 2012. Excludes the Creston Mascota deposit at Pinos Altos
for the first quarter of 2013.
|
|
(ii)
|
Under the Company's revenue recognition policy, revenue is recognized on
concentrates when legal title passes. 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.
|
|
(iii)
|
Total cash costs per ounce of gold produced is not a recognized measure
under US GAAP and this data may not be comparable to data presented by
other gold producers. This measure is calculated by adjusting
production costs as recorded in the consolidated statements of income
and comprehensive income for byproduct revenues, unsold concentrate
inventory production costs, non-cash reclamation provisions, deferred
stripping costs and other adjustments, and then dividing by the number
of ounces of gold produced. The Company believes that this generally
accepted industry measure is a realistic indication of operating
performance and is a useful comparison point between periods. Total
cash costs per ounce of gold produced is intended to provide investors
with information about the cash generating capabilities of the
Company's mining operations. Management also uses this measure to
monitor the performance of the Company's mining operations. As market
prices for gold are quoted on a per ounce basis, using this per ounce
measure allows management to assess a mine's cash generating
capabilities at various gold prices. Management is aware that this per
ounce measure of performance can be impacted by fluctuations in
byproduct metal prices and exchange rates. Management compensates for
these inherent limitations by using this measure in conjunction with
minesite costs per tonne (discussed below) as well as other data
prepared in accordance with US GAAP. Management also performs
sensitivity analyses in order to quantify the effects of fluctuating
metal prices and exchange rates.
|
|
(iv)
|
The Company reports total cash costs per ounce of gold produced and
minesite costs per tonne using a common industry practice of deferring
certain stripping costs that can be attributed to future production.
The purpose of adjusting for these stripping costs is to enhance the
comparability of total cash costs per ounce of gold produced and
minesite costs per tonne to the Company's peers within the mining
industry.
|
|
(v)
|
This inventory adjustment reflects production costs associated with
unsold concentrates.
|
|
(vi)
|
Minesite costs per tonne is not a recognized measure under US GAAP and
this data may not be comparable to data presented by other gold
producers. This measure is calculated by adjusting production costs as
shown in the consolidated statements of income and comprehensive income
for unsold concentrate inventory production costs, non-cash reclamation
provisions, deferred stripping costs and other adjustments, and then
dividing by tonnes of ore milled. As the total cash costs per ounce of
gold produced measure can be impacted by fluctuations in byproduct
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 US GAAP.
|
Note Regarding Certain Measures of Performance
This press release presents financial performance measures, including
"total cash costs per ounce of gold produced", "minesite costs per
tonne" and "all-in sustaining costs", that are not recognized measures
under US GAAP. This data may not be comparable to data presented by
other gold producers. The Company believes that these generally
accepted industry measures are realistic indicators of operating
performance and useful in allowing year-over-year comparisons. However,
each of these non-US GAAP measures should be considered together with
other data prepared in accordance with US GAAP. These measures, taken
by themselves, are not necessarily indicative of operating costs or
cash flow measures prepared in accordance with US GAAP. Reconciliations
of the Company's total cash costs per ounce of gold produced and
minesite costs per tonne financial performance measures to comparable
financial measures calculated and presented in accordance with US GAAP
are detailed above.
The contents of this press release have been prepared under the
supervision of, and reviewed by, Alain Blackburn, Ing., Senior
Vice-President, Exploration and a "Qualified Person" for the purposes
of NI 43-101.
Forward-Looking Statements
The information in this news release has been prepared as at April 25,
2013. Certain statements contained in this news release constitute
"forward-looking statements" within the meaning of the United States
Private Securities Litigation Reform Act of 1995 and "forward looking
information" under the provisions of Canadian provincial securities
laws and are referred to herein as "forward-looking statements". When
used in this document, words such as "anticipate", "expect",
"estimate", "forecast", "planned", "possible", "will", "likely",
"schedule" and similar expressions are intended to identify
forward-looking statements.
Such statements include without limitation: the Company's
forward-looking production guidance, including estimated ore grades,
project timelines, drilling results, orebody configurations, metal
production, life of mine estimates, production estimates, total cash
costs per ounce, minesite costs per tonne and all-in sustaining costs
estimates, cash flows, the estimated timing of scoping and other
studies, the methods by which ore will be extracted or processed,
expansion projects, recovery rates, mill throughput, and projected
exploration and capital expenditures, including costs and other
estimates upon which such projections are based; the Company's ability
to fund its current pipeline of projects; the impact of maintenance
shutdowns at Kittila; the Company's goal to build a mine at Meliadine;
the Company's ability to complete construction and bring into
production mines at Goldex or La India; and other statements and
information regarding anticipated trends with respect to the Company's
operations, exploration and the funding thereof. Such statements
reflect the Company's views as at the date of this news release and are
subject to certain risks, uncertainties and assumptions.
Forward-looking statements are necessarily based upon a number of
factors and assumptions that, while considered reasonable by
Agnico-Eagle as of the date of such statements, are inherently subject
to significant business, economic and competitive uncertainties and
contingencies. The factors and assumptions of Agnico-Eagle contained in
this news release, which may prove to be incorrect include, but are not
limited to the assumptions set forth herein and in management's
discussion and analysis and the Company's Annual Report on Form 20-F
for the year ended December 31, 2012 ("Form 20-F") as well as: that
there are no significant disruptions affecting operations, whether due
to labour disruptions, supply disruptions, damage to equipment, natural
occurrences, equipment failures, accidents, political changes, title
issues or otherwise; that permitting, production and expansion at each
of Agnico-Eagle's mines and growth projects proceeds on a basis
consistent with current expectations, and that Agnico-Eagle does not
change its plans relating to such projects; that the exchange rate
between the Canadian dollar, European Union euro, Mexican peso and the
United States dollar will be approximately consistent with current
levels or as set out in this news release; that prices for gold,
silver, zinc, copper and lead will be consistent with Agnico-Eagle's
expectations; that prices for key mining and construction supplies,
including labour costs, remain consistent with Agnico-Eagle's current
expectations; that Agnico-Eagle's current estimates of mineral
reserves, mineral resources, mineral grades and metal recovery are
accurate; that there are no material delays in the timing for
completion of ongoing growth projects; that the Company's current plans
to optimize production are successful; and that there are no material
variations in the current tax and regulatory environment. Many
factors, known and unknown, could cause the actual results to be
materially different from those expressed or implied by such
forward-looking statements. Such risks include, but are not limited to:
the volatility of prices of gold and other metals; uncertainty of
mineral reserves, mineral resources, mineral grades and metal recovery
estimates; uncertainty of future production, capital expenditures, and
other costs; currency fluctuations; financing of additional capital
requirements; cost of exploration and development programs; mining
risks; risks associated with foreign operations; governmental and
environmental regulation; the volatility of the Company's stock price;
and risks associated with the Company's byproduct metal derivative
strategies.
For a more detailed discussion of such risks and other factors, see the
Form 20-F, as well as the Company's other filings with the Canadian
Securities Administrators and the U.S. Securities and Exchange
Commission (the "SEC"). The Company does not intend, and does not
assume any obligation, to update these forward-looking statements and
information, except as required by law. Accordingly, readers are
advised not to place undue reliance on forward-looking statements.
Certain of the foregoing statements, primarily related to projects, are
based on preliminary views of the Company with respect to, among other
things, grade, tonnage, processing, recoveries, mining methods, capital
costs, total cash costs, minesite costs, and location of surface
infrastructure. Actual results and final decisions may be materially
different from those currently anticipated.
______________________________
1 Total cash costs per ounce is a non-GAAP measure. For reconciliation to
production costs, see footnote (iii) to the "Reconciliation of
production costs to Total Cash Costs per Ounce and Minesite Costs per
Tonne" contained herein. See also "Note Regarding Certain Measures of
Performance".
2 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 All-in sustaining cost is a non-GAAP measure. The Company calculates
all-in sustaining costs as the sum of total cash costs (net of
byproduct credits), sustaining capital expense, corporate, general and
administrative expense (net of stock option expense) and exploration
expense. The Company's methodology for calculating all-in sustaining
costs may not be similar to methodology used by other gold producers
that disclose all-in sustaining cost. The Company may change the
methodology it uses to calculate all-in sustaining costs in the future,
including in circumstances where the World Gold Council adopts formal
industry guidelines regarding this measure.
4 Minesite costs per tonne is a non-GAAP measure. For reconciliation to
production costs, see footnote (vi) to the "Reconciliation of
production costs to Total Cash Costs per Ounce and Minesite Costs per
Tonne" contained herein. See also "Note Regarding Certain Measures of
Performance".
5 Total cash costs per ounce of gold produced and minesite costs per
tonne of ore processed for Creston Mascota are excluded from figures
for first quarter 2013, due to the suspension of heap leach operations
at Creston Mascota effective October 1, 2012
SOURCE Agnico-Eagle Mines Limited