Stock Symbol: AEM (NYSE and TSX)
(All amounts expressed in U.S. dollars unless otherwise
noted)
TORONTO,
Oct. 28, 2015 /PRNewswire/ -
Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico
Eagle" or the "Company") today reported quarterly net income of
$1.3 million, or net income of
$0.01 per share for the third quarter
of 2015. This result includes losses on financial instruments
of $16.6 million ($0.08 per share), a non-cash foreign currency
translation loss on deferred tax liabilities of $8.1 million ($0.04
per share), various mark-to-market and other adjustment losses of
$9.5 million ($0.04 per share), non-cash stock option expense
of $4.1 million ($0.02 per share), non-cash foreign currency
translation losses of $0.9 million
(nil per share), and non-recurring gains of $1.3 million ($0.01
per share). Excluding these items would result in adjusted
net income of $39.2 million or
adjusted net income of $0.18 per
share for the third quarter of 2015. In the third quarter of
2014, the Company reported a net loss of $15.1 million or a net loss of $0.07 per share.
Based on the exploration success in the first
half of the year at several of the Company's projects, it was
previously announced that exploration expense would increase in the
second half of the year. Total exploration expense for the
third quarter was $37.1 million.
As a result of this increased exploration
expense the Amaruq project in Nunavut yielded a significant increase in
inferred resources (see August 19,
2015 news release) and an initial resource is expected to be
reported by mid-February 2016 at the
El Barqueno project in Mexico.
For the first nine months of 2015, the Company
reported net income of $40.1 million,
or $0.19 per share. This
compares with the first nine months of 2014 when net income was
$104.3 million, or $0.55 per share. Financial results in the
2015 period were negatively impacted by much higher investment in
exploration (approximately 102% higher); lower gold prices
(approximately 9% lower) and lower by-product metals revenues.
Third quarter 2015 cash provided by operating
activities was $143.7 million
($217.8 million before changes in
non-cash components of working capital). This compares to
cash provided by operating activities of $71.2 million in the third quarter of 2014
($129.2 million before changes in
non-cash components of working capital). The increase in cash
provided by operating activities before changes in working capital
during the current period was mainly due to an increase of 26% in
gold production.
For the first nine months of 2015, cash provided
by operating activities was $475.5
million ($547.4 million before
changes in non-cash components of working capital), as compared
with the first nine months of 2014 when cash provided by operating
activities was $504.4 million
($472.8 million before changes in
non-cash components of working capital). The increase in cash
provided by operating activities before changes in working capital
during the period was mainly due to a 20% increase in gold
production.
"In the third quarter of 2015, we set a new
record for quarterly gold production and lowered unit costs which
resulted in strong operating cash flow. This has allowed us
to continue to invest in our exploration and development pipeline,
which represents the long-term future of our business," said
Sean Boyd, Agnico Eagle's Chief
Executive Officer. "Our increased level of exploration
activity continues to pay dividends as witnessed by the new
discoveries at Kittila, Amaruq and El Barqueno. These
projects are expected to be significant contributors to our
production profile in the coming years," added Mr. Boyd.
Third Quarter 2015 Highlights Include:
- Strong performance of Abitibi operations drives record
quarterly gold production and low costs - Payable gold
production1 in the third quarter of 2015 was 441,124
ounces of gold at total cash costs2 per ounce on a
by-product basis of $536 and all-in
sustaining costs3 on a by-product basis ("AISC") of
$759 per ounce
- Two new production records set at Canadian Malartic -
New quarterly records were set for average tonnes processed per
calendar day (53,703 tonnes on a 100% basis), and ounces of gold
produced in a quarter (153,206 ounces on a 100% basis)
- 2015 production guidance increased and cost forecasts
reduced - Expected gold production for 2015 is now forecast to
be approximately 1.65 million ounces (previously 1.6 million
ounces) with total cash costs on a by-product basis of
approximately $590 to $610 per ounce
(previously $600 to $620) and AISC of
approximately $840 to $860 per ounce
(previously $870 to $890)
expected
- Amaruq drilling expands scope of known mineralization -
Drilling indicates that the Whale Tail and Mammoth zones form a
single mineralized system at least 2.3 kilometres long. In
addition, the V zone (part of the IVR area) has been identified as
a substantial mineralized structure, locally with abundant visible
gold
- Drilling extends new parallel zone at Kittila - Two
recent drill holes have confirmed continuity within the new
parallel lens (now called the "Sisar lens"). Highlights
include: 8.1 grams per tonne ("g/t") gold (uncapped) over 8.0
metres at 1,235 metres depth; and 5.5 g/t gold (uncapped) over 3.3
metres at 950 metres depth and 560 metres farther north along
strike
- Improved financial flexibility - In the third quarter,
the Company's credit facility was amended and $25 million was repaid. In addition, a
10-year, $50-million term note was
issued to Ressources Québec, a subsidiary of Investissement
Québec. Capital expenditures in 2015 are also forecast to be
approximately $50 million lower than
previously reported due to positive foreign currency adjustments
and deferrals into future periods
- A quarterly dividend of $0.08
per share was declared
| ________________________________ |
| 1 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 |
| 2 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
calculated 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
"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 Financial
Performance Measures". |
| 3All-in sustaining costs 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 -
Reconciliation of Production Costs to All-In Sustaining Costs Per
Ounce of Gold Produced" below. The Company calculates all-in
sustaining costs per ounce of gold produced on a by-product basis
as the aggregate of total cash costs 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 amount 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 per ounce of gold produced on a by-product basis
except that no adjustment for by-product metal revenues is
made. The Company's methodology for calculating all-in
sustaining costs differ from the methodology used by other
producers that disclose all-in sustaining costs. See "Note
Regarding Certain Measures of Performance". The Company may
change the methodology it uses to calculate all-in sustaining costs
in the future, including in response to the adoption of formal
industry guidance regarding this measure by the World Gold
Council. |
| |
Third Quarter Financial and Production Highlights
In the third quarter of 2015, strong operational
performance continued at the Company's mines.
Payable gold production in the third quarter of
2015 was a record 441,124 ounces compared to 349,273 ounces in the
third quarter of 2014. The higher level of production in the
2015 period was primarily due to increased throughput levels at
LaRonde, Goldex and Canadian Malartic, increased mill capacity at
Kittila and higher grades at LaRonde, Meadowbank, Goldex, Kittila,
Pinos Altos and La India. A
detailed description of the production and cost performance at each
mine is set out below.
Total cash costs per ounce on a by-product basis
for the third quarter of 2015 were lower at $536 compared to $716 per ounce for the third quarter of
2014. The reduction in total cash costs per ounce on a
by-product basis in the third quarter of 2015 was a result of
higher silver production, higher gold production at the majority of
the Company's mines and weaker local currencies compared to the
third quarter of 2014.
In the third quarter of 2015 the average value
of the Canadian dollar, Euro and Mexican Peso were 8%, 4%, and 23%
lower, respectively than the Company's 2015 currency price
assumptions (see February 11, 2015
news release).
Payable gold production for the first nine months of 2015 was
1,249,012 ounces, compared to payable gold production of 1,041,753
ounces in the comparable 2014 period (which only included 76,639
ounces from Canadian Malartic for production from June 16 to September 30, 2014).
For the first nine months of 2015, total cash costs on a
by-product basis were $574 per
ounce. This compares with $627
per ounce on a by-product basis in the first nine months of
2014. The lower costs in the 2015 period are due to the
higher levels of production and favourable currency movements
compared to the 2014 period.
AISC for the third quarter of 2015 was lower at
$759 versus $1,059 per ounce for the third quarter of
2014. The lower AISC is primarily due to higher production,
lower total cash costs per ounce on a by-product basis, lower
general and administrative expenditures and lower capital
expenditures.
For the first nine months of 2015, AISC was $808 versus $947
per ounce for the 2014 period. The lower AISC in the 2015
period is due to the same reasons set out above.
Cash Position Remains Strong; Continued focus on Debt
Reduction; Credit lines extended for an additional year through
2020
Cash and cash equivalents and short term
investments increased to $208.1
million at September 30, 2015,
from the June 30, 2015 balance of
$164.0 million.
The outstanding balance on the Company's
$1.2 billion credit facility was
reduced from $375 million at
June 30, 2015 to $350 million at September
30, 2015. This results in available credit lines of
approximately $850 million, not
including the $300 million accordion
facility.
On September 30,
2015, the Company amended its $1.2
billion Credit Facility to extend the maturity date from
June 22, 2019 to June 22, 2020 and improve the pricing terms.
On September 30
2015, a private placement of a $50
million, 10-year senior unsecured note (the "Note") with a
maturity of September 30, 2025 was
completed with Ressources Québec, a subsidiary of Investissement
Québec. The Company has agreed to use the net proceeds from
the issuance of the Note at its mining projects in the Province of
Québec.
Total capital expenditures made by the Company
in the third quarter of 2015 were $122.4
million, including $24.8
million at Meliadine, $19.7
million at Meadowbank, $15.1
million at LaRonde, $14.1
million at Kittila, $13.3
million at Goldex, $12.5
million at Pinos Altos,
$9.3 million at Canadian Malartic
(50% basis), $7.0 million at La
India, $1.2 million at Creston
Mascota and $1.1 million at Lapa.
Total capital expenditures for the first nine months of 2015
were $316.8 million including
$50.6 million at LaRonde,
$47.4 million at Meadowbank,
$44.6 million at Meliadine,
$41.8 million at Pinos Altos, $38.4
million at Kittila, $35.3
million at Goldex, $29.8
million at Canadian Malartic (50% basis), $15.5 million at La India, $5.5 million at Lapa and $1.6 million at Creston Mascota.
Total sustaining capital expenditures made by
the Company in the third quarter were $72.0
million, including $19.5
million at Meadowbank, $15.1
million at LaRonde, $10.6
million at Kittila, $8.2
million at Canadian Malartic (50% basis), $7.0 million at La India, $6.7 million at Pinos
Altos, $2.6 million at Goldex,
$1.2 million at Creston Mascota and
$1.1 million at Lapa.
Total sustaining capital expenditures for the first nine months
of 2015 were $214.7 million including
$50.6 million at LaRonde,
$47.2 million at Meadowbank,
$30.7 million at Kittila,
$28.0 million at Canadian Malartic
(50% basis), $24.0 million at
Pinos Altos, $15.5 million at La India, $11.6
million at Goldex, $5.5
million at Lapa, and $1.6
million at Creston Mascota.
For 2015, capital expenditures are expected to
total approximately $489.0 million,
representing approximately a $50
million decrease from the previously announced figure.
The decrease is primarily due to favourable currency movements and
capital expenditure deferrals into future periods.
The Company recorded an income and mining taxes
recovery of $15.3 million on the
consolidated statements of income for the third quarter of
2015. This was primarily a result of applying effective tax
rates on a regional tax basis which were well in excess of the
statutory tax rate based on IFRS tax calculation methodology. The
Company continues to guide an effective tax rate range between 40%
and 45% for 2015.
Revised 2015 Guidance - Production Increased
and Costs Lowered
As a result of strong operational performance in
the third quarter of 2015, production guidance for 2015 has been
increased to approximately 1.65 million ounces of gold (previously
1.6 million ounces) with total cash costs on a by-product basis of
approximately $590 to $610 per ounce
(previously $600 to $620) and AISC of
approximately $840 to $860 per ounce
(previously $870 to $890).
Third Quarter 2015 Results Conference Call and Webcast
Tomorrow
The Company's senior management will host a conference call on
Thursday, October 29, 2015 at
11:00 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 www.agnicoeagle.com.
Via Telephone:
For those preferring to listen by telephone,
please dial 1-416-260-0113 or toll-free 1-800-524-8950. To
ensure your participation, please call approximately five minutes
prior to the scheduled start of the call.
Replay Archive:
Please dial 1-647-436-0148 or toll-free
1-888-203-1112, access code 3791390. The conference call replay
will expire on November 29, 2015.
The webcast, along with presentation slides,
will be archived for 180 days on www.agnicoeagle.com.
NORTHERN BUSINESS OPERATING REVIEW
ABITIBI REGION, QUEBEC
Agnico Eagle is currently Quebec's largest gold producer with a 100%
interest in three mines (LaRonde, Goldex and Lapa) and a 50%
interest in the Canadian Malartic mine. These mines are
located within 50 kilometres of each other, which provides
operating synergies and allows for the sharing of technical
expertise.
LaRonde Mine - Increased Production Driven by Higher Grades
in Lower Mining Area, Phase 1 Commissioning of Coarse Ore Conveyor
Underway
The 100% owned LaRonde mine in northwestern
Quebec achieved commercial
production in 1988.
The LaRonde mill processed an average of 5,992
tonnes per day ("tpd") in the third quarter of 2015, compared with
an average of 4,634 tpd in the corresponding period of 2014.
Throughput in the 2014 period was lower due to an approximate four
week shutdown related to the upgrade and commissioning of the
production and service hoist drives at the Penna shaft.
Minesite costs per tonne4 were
approximately C$101 in the third
quarter of 2015, lower than the C$111
per tonne experienced in the third quarter of 2014. The
higher costs in the 2014 period were primarily due to the scheduled
shutdown noted above.
For the first nine months of 2015, the LaRonde mill processed an
average of 6,145 tpd, compared to 5,668 tpd in the first nine
months of 2014. Minesite costs per tonne were approximately
C$101, compared to C$100 per tonne in the first nine months of
2014.
LaRonde's total cash costs per ounce on a
by-product basis were $558 in the
third quarter of 2015 on payable production of 71,860 ounces of
gold. This compares with the third quarter of 2014 when total
cash costs per ounce on a by-product basis were $861 on production of 37,490 ounces of
gold. Production in the 2015 period increased as a result of
higher throughput and higher gold grades (primarily from the 293
mining pyramid) compared to the 2014 period. Costs in the
2015 period were lower due to higher gold production (partially
offset by lower by-product revenues) and favourable foreign
exchange rates.
In the first nine months of 2015, LaRonde produced 194,760
ounces of gold at total cash costs per ounce of $620 on a by-product basis. This is in
contrast with the first nine months of 2014 when the mine produced
145,336 ounces of gold at total cash costs per ounce of
$701 on a by-product basis.
Production in the 2015 period was higher and costs were lower due
to the factors mentioned above.
During the quarter, work was completed on the
installation of the coarse ore conveyor system that extends from
the 293 level to the crusher on the 280 level. The first
phase of commissioning involving the discharge point and rock
breaker is underway. The ore pass feeding the rock breaker is
expected to be commissioned in the first quarter of 2016. The
new conveyor should help to improve mining flexibility and reduce
congestion in the deeper portions of the mine.
Studies are continuing to assess the potential
to extend the mineral reserves and carry out mining activities
between the 311 and 371 levels at LaRonde. At present, the
mineral reserves extend to the 311 level, which is 3.1 kilometres
below the surface. Drilling is ongoing to further expand the
known mineral resource between the 311 and 341 levels.
Additional holes are also being drilled to evaluate the extent of
the mineralization down to the 371 level (a depth of 3.7 kilometres
below the surface).
The exploration is currently focused on Zone 20,
which is the active mining horizon. Additional drilling is
also planned for Zone 6, which is located in the footwall to Zone
20.
| ___________________________________ |
| 4 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". |
| |
Canadian Malartic Mine - New Quarterly Production Records
Established
In June 2014,
Agnico Eagle and Yamana Gold Inc. ("Yamana") acquired all of the
issued and outstanding common shares of Osisko Mining Corporation
("Osisko") and created the Canadian Malartic General Partnership (the
"Partnership"). The partnership owns and operates the
Canadian Malartic mine in northwestern Quebec through a joint management
committee. Each of Agnico Eagle and Yamana has an indirect
50% ownership interest in the Partnership.
Canadian Malartic had very strong operational
performance in the third quarter of 2015. New records were set for
quarterly tonnes milled (4.94 million tonnes), tonnes processed per
day (53,703 tonnes), and ounces produced (153,206 ounces on a 100%
basis). On September 22, 2015,
the mine poured its two millionth ounce of gold.
During the third quarter of 2015, the Canadian
Malartic mill processed an average of 53,703 tpd (on a 100% basis)
compared with an average of 52,539 tpd in the corresponding period
of 2014. Minesite costs per tonne were approximately
C$22 (C$19.32 excluding royalties) compared to the
C$22 (C$19.60 excluding royalties) per tonne
experienced in the third quarter of 2014. The costs in the
2015 period were in line with the costs in the 2014 period.
Throughput was higher in the 2015 period due to improved crusher
operating time. The average stripping ratio in the third
quarter of 2015 was 2.04 to 1.0.
For the first nine months of 2015, the Canadian Malartic mill
processed an average of 52,139 tpd compared with an average of
50,580 tpd in the corresponding period of 2014 (on a 100%
basis). Minesite costs per tonne were approximately
C$23 (C$19.72 excluding royalties) compared to the
C$22 (C$19.42 excluding royalties) per tonne
experienced in the corresponding period of 2014. The 2014
tonnage and costs are not considered to be representative as they
only reflect the period of June 16 through
September 30.
For the third quarter of 2015, Agnico Eagle's
share of production at the Canadian Malartic mine was 76,603 ounces
of gold at total cash costs per ounce of $544 on a by-product basis. This compares
with the third quarter of 2014 when total cash costs per ounce on a
by-product basis were $735 on
production of 64,761 ounces of gold. Production was higher in the
2015 period due to increased mill throughput and higher
grades. Costs in the 2015 period were lower due to increased
production and favourable foreign exchange rates.
In the first nine months of 2015, Agnico Eagle's share of
production at the Canadian Malartic mine was 212,937 ounces of gold
at total cash costs per ounce of $593
on a by-product basis. This is in contrast with production
from June 16 to September 30, 2014
which only included 76,639 ounces of gold at total cash costs per
ounce of $717 on a by-product basis
from Canadian Malartic.
The Partnership continues to work on initiatives
to optimize the operations. Current opportunities
include:
- Improving SAG mill and crusher liners to attempt to reduce the
number of planned shutdowns to three per year (currently four per
year). New liners were installed in Q3 2015
- Improving gyratory crusher availability by redirecting ore
containing scrap steel to a separate crusher
- Maintaining mining throughput levels at two million tonnes per
month in the North zone (which contains higher grades)
- Acquiring an additional remote excavator for use in the North
zone
- Adding two larger production drills which is expected reduce
drilling costs
- Increasing rate of waste rock backfilling of the Gouldie pit
which reduces haulage distances and noise
Permitting activities for the Barnat Extension
and deviation of Highway 117 are continuing. An Environmental
Impact Assessment ("EIA") for this project was submitted in
February 2015. An initial
series of questions were received by the Partnership, and final
responses were submitted in September
2015. A second round of questions from the government
is expected to be received later in the fourth quarter of
2015. Public hearings are then expected to be held in the
spring of 2016, with receipt of the necessary permits potentially
by year-end 2016. In parallel, the Partnership is currently
working on the permitting for improving the efficiency and
environmental performance of the existing mobile crusher. At
this point, milling levels are expected to be approximately 53,000
tpd through year-end 2016.
In March 2015, the
Partnership increased its interest in the Malartic CHL property to
100% by acquiring the remaining 30% interest from Abitibi Royalties
Inc. The Malartic CHL property adjoins the Canadian Malartic
mine to the east and hosts part of the Odyssey North
discovery. At the end of the third quarter of 2015, 28 holes
(24,537 metres) of drilling had been completed on the Odyssey
zones. Drilling and data compilation will continue in the
fourth quarter.
Update on Pandora and Kirkland Lake
Projects
Canadian Malartic
Corporation, a company in which each of Agnico Eagle and
Yamana has an indirect 50% interest, is exploring a portfolio of
properties in the Kirkland Lake
area of Ontario and the Pandora
property in the Abitibi region of Quebec.
In the Kirkland
Lake area, an internal technical study on the Upper Beaver
property is being reviewed. Elsewhere in the region, compilation
work is ongoing and a select number of targets are being
drilled.
At Pandora, underground development on the 101-W
exploration drift from the adjacent Lapa mine commenced in
February 2015 and approximately 691
metres of development was completed by the end of the third quarter
of 2015. For the full year, approximately 940 metres of
development is planned.
In mid-June 2015,
underground drilling resumed from the 101-W exploration drift and
approximately half of the proposed 2015 program (approximately
7,000 metres) was completed by the end of the third quarter.
The focus of the current exploration program is to test for
extensions to the Branch zone and C zone on the Pandora
property.
Lapa - Zulapa Z7 Zone Continues to Deliver Higher Grades and
Recoveries
The 100% owned Lapa mine in northwestern Quebec achieved commercial production in
May 2009.
The Lapa circuit, located at the LaRonde mill,
processed an average of 1,583 tpd in the third quarter of
2015. This compares with an average of 1,703 tpd in the third
quarter of 2014. Throughput in the 2015 period was lower
because of downtime related to repairs carried out on the Lapa ball
mill. Repairs were completed in August
2015. During the repair time, excess ore was
stockpiled and there is sufficient mill capacity that should allow
the Company to meet its annual throughput rate (tonnes and ounces)
over the balance of 2015.
Minesite costs per tonne were C$114 in the third quarter of 2015, compared to
the C$104 in the third quarter of
2014. Costs in the 2015 period were higher due to mining at
deeper depths and lower throughput compared to the same period in
2014.
For the first nine months of 2015, the Lapa mill processed an
average of 1,553 tpd, compared to 1,747 tpd in the first nine
months of 2014. Minesite costs per tonne were approximately
C$119, above the C$106 per tonne in the first nine months of 2014
due to the reasons explained above.
Payable production in the third quarter of 2015
was 25,668 ounces of gold at total cash costs per ounce on a
by-product basis of $522. This
compares with the third quarter of 2014, when production was 24,781
ounces of gold at total cash costs per ounce on a by-product basis
of $606. In the 2015 period,
production was higher primarily due to better recoveries (up 8.7%)
related to a higher component of free gold in the Zulapa Z7 ore
zone. Costs were lower primarily due to increased production
and favourable foreign exchange rates.
In the first nine months of 2015, Lapa produced 71,038 ounces of
gold at total cash costs per ounce of $581 on a by-product basis. This compares
to the first nine months of 2014 when the mine produced 67,011
ounces of gold at total cash costs per ounce of $689 on a by-product basis. The higher
production and lower costs in the 2015 period are due to the
reasons outlined above.
At Lapa, 2015 is the last full year of
production based on the current life of mine plan. Commercial
production is forecast to end at the mine in the third quarter of
2016, but exploration activities (primarily on the Pandora
property) are expected to continue. The permanent employees
are expected to be relocated to the Company's other operations
where they will replace contract positions.
Studies are underway to evaluate other internal
opportunities to utilize the Lapa mill, which is located at the
LaRonde Metallurgical complex.
Goldex - Development Rates Expected to Double by Year End; M
Zone Yields Better Than Expected Grades
The 100% owned Goldex mine in northwestern
Quebec began operation in 2008 but
mining operations in the original orebody, the Goldex Extension
Zone ("GEZ"), were suspended in October
2011. In July 2012, the
M and E satellite zones were approved for development. Mining
operations resumed on the M and E satellite zones in September 2013. Mining operations at GEZ
remain suspended.
The Goldex mill processed an average of 6,199
tpd in the third quarter of 2015. This compares with an
average of 5,851 tpd in the third quarter of 2014. The higher
throughput in the 2015 period was due to more mature mining fronts
and productivity improvements compared to the 2014 period.
Minesite costs per tonne were approximately
C$34 in the third quarter of 2015,
which was slightly higher than the C$32 per tonne experienced in the third quarter
of 2014. The increased cost in the 2015 period is primarily
due to increased development in the M3 and M4 zones and extensions
to the E Zone.
For the first nine months of 2015, the Goldex mill processed an
average of 6,377 tpd, compared to 5,647 tpd in the first nine
months of 2014. Minesite costs per tonne were approximately
C$34 in the first nine months of 2015
which is in line with C$33 in first
nine months of 2014.
Payable gold production in the third quarter of
2015 was 32,068 ounces of gold at total cash costs per ounce on a
by-product basis of $479. This
compares with the third quarter of 2014, when production was 27,611
ounces of gold at total cash costs per ounce on a by-product basis
of $582. The higher production
in the 2015 period was largely due to increased tonnage and better
grades (especially in the M Zone) and higher recoveries. The
decrease in total cash costs in the 2015 period was largely a
result of increased production and favourable foreign exchange
rates compared to the 2014 period.
In the first nine months of 2015, Goldex produced 87,780 ounces
of gold at total cash costs per ounce of $546 on a by-product basis. This compares
to the first nine months of 2014 when the mine produced 70,970
ounces of gold at total cash costs per ounce of $661 on a by-product basis. The higher
production and lower costs in the 2015 period are due to the same
reasons as outlined above.
In late July 2015,
the Company announced production approval for the Goldex Deep 1
project (see July 29, 2015 news
release). Mining will focus on the lower part of the Dx zone
and the top of the D zone from a depth of 850 metres to 1,200
metres (level 120). The Company plans to undertake
development from the current Goldex infrastructure, with existing
equipment and personnel. The planned mining method is
long-hole stoping with cemented paste backfill, which is the same
method currently used at Goldex M & E zones. Gold
production from the Goldex Deep 1 project is currently expected to
average in excess of 100,000 ounces per year from 2018 through
2024.
In the third quarter of 2015, approximately
1,462 metres of development were carried out in the Deep
zone. The ramp has now reached Level 115 on its way to an
ultimate depth of level 120. In addition, full restoration of
the surface ramp is expected to be completed by the end of this
year. This ramp will improve on the ability to move equipment
and supplies from the surface into the underground workings.
The advancement of the Deep 1 project at Goldex
also has the potential to unlock other significant value creating
opportunities including:
- Potential for additional mineral resource conversion in the
Deep 1 zone
- Potential for mining at the Deep 2 (below level 120)
- Potential to develop the South zone (a narrow high-grade zone
accessible via Deep 1 infrastructure)
- Potential development of the Akasaba West deposit, which is
approximately 30 kilometres to the East of Goldex
An EIA on the Akasaba West deposit was submitted
during the quarter, which allows the environmental review process
to commence. The Company anticipates the EIA approval in late
2017 or early 2018.
FINLAND AND SWEDEN
Agnico Eagle's Kittila mine in Finland is the largest primary gold producer
in Europe and hosts the Company's
largest mineral reserves. Exploration activities continue to
expand the mineral resources and studies are underway to evaluate
the potential to cost-effectively increase production.
Kittila - Focus Remains On Optimizing Future Production
Levels and Exploration Potential of the New Parallel Zone
The 100% owned Kittila mine in northern
Finland achieved commercial
production in 2009.
The Kittila mill processed an average of 3,937
tpd in the third quarter of 2015 compared to the 2,559 tpd in the
third quarter of 2014. Throughput in the 2014 period was lower due
to a planned shutdown to complete the mill expansion.
Minesite costs per tonne at Kittila were approximately €72 in the
third quarter of 2015, compared to €86 in the third quarter of
2014. Costs decreased in the third quarter of 2015 due to the
increased throughput when compared with the 2014 period.
For the first nine months of 2015, the Kittila mill processed an
average of 3,981 tpd, compared to 2,895 tpd in the first nine
months of 2014. Minesite costs per tonne were approximately
€75 in the first nine months of 2015, compared to the €79 per tonne
in the comparable 2014 period. Throughput was higher and
costs were lower in the 2015 period due to the reasons outlined
above.
Since the expansion, the mill has shown
potential to operate in excess of 4,000 tpd and efforts are ongoing
to optimize throughput and recovery rates. In addition, the Company
is also working to optimize underground mining rates and evaluate
the potential to develop new mining areas. Unit costs are
expected to decrease once steady state operations are achieved.
Third quarter 2015 payable gold production at
Kittila was 46,455 ounces with total cash costs per ounce on a
by-product basis of $639. In
the third quarter of 2014, the mine produced 28,230 ounces at total
cash costs per ounce on a by-product basis of $951. The higher production in the 2015
period is a result of the increased mill capacity compared to the
2014 period and the planned 2014 shutdown. Costs decreased in
the third quarter of 2015 primarily due to increased production and
a favourable foreign exchange rate.
In the first nine months of 2015, Kittila produced 133,095
ounces of gold at total cash costs per ounce of $696 on a by-product basis. This is in
contrast to the first nine months of 2014, when the mine produced
98,612 ounces of gold at total cash costs per ounce of $861 on a by-product basis. The lower cash
costs in 2015 are mainly due to reasons described above.
Drilling Extends New Parallel Zone at Kittila
Previous drilling from the surface at Kittila
has outlined a significant zone of deep mineralization at Rimpi
with potentially wider widths and better grades than those
currently being mined. The main underground ramp at Kittila
is being extended to reach the Rimpi zone and a new surface ramp is
also being developed to access the shallower portions of the Rimpi
deposit. The surface ramp had advanced a total of 825 metres
to 134 metres depth by the end of September.
In April and July, the Company announced that
drilling had encountered a mineralized lens east of the main
Kittila ore zone, within the sheared and altered structure that
hosts the known Kittila deposits (see April
30, 2015 and July 29, 2015
news releases). The intercepts lay within an area
approximately 800 metres long north to south between 975 and 1,300
metres below surface, approximately 100 to 150 metres east of the
main ore zone. These intercepts indicate a new parallel lens
(now called the "Sisar lens" which in English means "sister lens"),
that could extend upwards to a similar elevation as the main
exploration ramp (currently at 800 metres depth) being driven
towards Rimpi. This new lens could provide additional tonnage
should further drilling outline an economic deposit.
Two recent holes drilled from the exploration
ramp have confirmed continuity within the Sisar lens. The
table below shows the intercepts of the two new holes as well as
those reported previously from the Sisar lens. Pierce points for
all these holes are shown on the Kittila composite longitudinal
section and two cross sections (500 metres apart). All
intercepts reported for the Kittila mine show uncapped grades over
estimated true widths, based on a current geological interpretation
that is being updated as new information becomes available with
further drilling.
Recent exploration drill results from the Kittila
mine
| Drill hole |
Zone |
From
(metres) |
To
(metres) |
Depth
of
midpoint
below
surface
(metres) |
Estimated
true width
(metres) |
Gold grade
(g/t)
(uncapped) |
| ROU10-037* |
Sisar |
1,299.0 |
1,311.0 |
1,197 |
5.6 |
10.2 |
| ROD14-003** |
Sisar |
576.0 |
580.0 |
1,195 |
3.1 |
5.3 |
| ROD14-005** |
Sisar |
628.0 |
641.2 |
1,258 |
7.0 |
7.0 |
| ROU15-600 |
Sisar |
313.0 |
316.8 |
950 |
3.3 |
5.5 |
| ROU15-603*** |
Sisar |
323.0 |
338.0 |
977 |
13.3 |
5.2 |
| ROD15-703 |
Main zone |
378.0 |
389.0 |
1,028 |
6.1 |
14.3 |
| and |
Main zone |
442.0 |
448.0 |
1,077 |
3.5 |
5.8 |
| and |
Sisar |
641.8 |
654.0 |
1,235 |
8.0 |
8.1 |
* Previously reported in Company news release dated
April 28, 2011 as 9.5 g/t over 6.0 metres.
** Previously reported in Company news release dated April 30,
2015
*** Previously reported in Company news release dated July 29,
2015 |
Kittila composite longitudinal section
Kittila composite cross sections - 7538000mN and 7538500mN
Hole ROD15-703 intersected two lenses in the
main zone and one in the Sisar lens. In the main ore zone,
this hole intersected 14.3 g/t gold over 6.1 metres at 1,028 metres
depth, and 5.8 g/t gold over 3.5 metres at 1,077 metres
depth. The upper intercept verifies, widens and increases the
grade of the probable reserves between the Suuri and Roura trends,
while the lower one extends the mineralization to the north, and
will help to convert future resources. The hole then
intersected 8.1 g/t gold over 8.0 metres at 1,235 metres depth in
the Sisar lens, approximately 150 metres east of the main ore zone,
strongly confirming the continuity of the lens. This
intercept is between two previously reported intercepts at
approximately the same depth: it is approximately 116 metres north
of hole ROU10-037 and 250 metres south of hole ROD14-003.
At shallower depths and approximately 560 metres
farther north, hole ROU15-600 intersected 5.5 g/t gold over 3.3
metres at 950 metres below surface, approximately 100 metres east
of the main zone mineralization. This intercept is
approximately 130 metres south of the previously reported intercept
of hole ROU15-603.
Additional holes have been drilled in the
vicinity of the new Sisar lens intercepts, and assays are
pending. A second underground deep drill rig is expected to
start operating in the fourth quarter 2015 and carry on into 2016
to determine continuity and test for extensions of the Sisar
lens.
At the Kuotko deposit, located approximately 15
kilometres north of Kittila, drilling continues with a focus on
infilling and expanding the existing inferred resource of
approximately 170,000 ounces (1.8 million tonnes at 2.9 g/t
gold). In addition, new mineralized zones have been
identified outside of the known resource areas. Metallurgical
testing is ongoing and unlike Kittila, the gold mineralization is
free milling. Upon completion of the drilling, studies will
be carried out to assess the viability of mining the deposit as a
satellite open pit.
Barsele Project - Drilling Now Underway on the Central
Zone
On June 11, 2015,
Agnico Eagle acquired a 55% interest in the Barsele project in
Sweden. The Company can earn
an additional 15% interest in the project through the completion of
a pre-feasibility study.
The Barsele property is known to contain
intrusive-hosted gold mineralization and gold-rich volcanogenic
massive sulphide mineralization. In 2015, the Company plans
to spend approximately $3.25 million
on exploration to further evaluate the mineral potential of the
property.
In September 2015,
trenching and mapping programs were carried out that confirmed that
the known intrusive-hosted deposits plunge to the southeast.
A 16-hole (9,300-metre) drill program commenced in early October to
test the depth extension of the Central Zone to 400 to 500 metres
below surface.
NUNAVUT REGION
With the Company's largest producing mine
(Meadowbank) and two significant development assets and exploration
projects (Meliadine and Amaruq) located in Nunavut, Agnico Eagle has the potential to
build an operating platform that could have the ability to generate
strong production and cash flows over several decades.
Meadowbank - Increased Waste Stripping Capacity Provides
Production Flexibility
The 100% owned Meadowbank mine in Nunavut, northern Canada, achieved commercial production in
March 2010.
The Meadowbank mill processed an average of
10,824 tpd in the third quarter of 2015, compared to the 11,492 tpd
achieved in the third quarter of 2014. Mill throughput levels
were lower in the 2015 period due to a higher percentage of Vault
ore processed which has a higher hardness factor, which has an
impact on both the primary and secondary grinding circuit
efficiency.
Minesite costs per tonne were approximately
C$72 in the third quarter of 2015,
which compares to C$74 per tonne in
the third quarter of 2014. The lower costs in the 2015 period
were primarily due to an increase in capitalized versus expensed
waste stripping compared to the respective 2014 period.
For the first nine months of 2015, the Meadowbank mill processed
an average of 11,009 tpd, compared to 11,365 tpd in the first nine
months of 2014. Mill throughput levels were lower in the 2015
period primarily due to the reasons outlined above. Minesite
costs per tonne were approximately C$72 in the first nine months of 2015, which was
similar to the C$73 per tonne in the
comparable 2014 period.
Payable production in the third quarter of 2015
was 99,425 ounces of gold at total cash costs per ounce on a
by-product basis of $598. This
compares with the third quarter of 2014 when 91,557 ounces were
produced at total cash costs per ounce on a by-product basis of
$777. The higher production in
the 2015 period compared to the 2014 period was primarily due to
the processing of higher grade ore (an increase of approximately
15%) and slightly better recoveries. Costs in the 2015 period
were lower due to increased production and favourable foreign
exchange rates.
In the first nine months of 2015, Meadowbank produced 279,224
ounces of gold at total cash costs per ounce of $646 on a by-product basis. In the first
nine months of 2014, the mine produced 366,162 ounces of gold at
total cash costs per ounce of $561 on
a by-product basis. The lower production (down 24%) in the
2015 period compared to the previous period was primarily due to
processing fewer tonnes at lower grades and lower mill recoveries
(down 2.3%). During the first six months of the 2014 period,
the Company encountered ore grades that were higher than expected
in both the Portage and Goose pits.
In 2013, approximately 246,000 ounces were
removed from mineral reserves at the Vault deposit due to a change
in the gold price assumption used to calculate mineral reserves at
December 31, 2013. Given the
current US dollar to Canadian dollar foreign exchange rate (which
yields favourable revenues and costs in Canadian dollar terms),
lower fuel costs, and the growing significance of the Amaruq
Project, the Company made a decision in July
2015 to proceed with the expansion of the Vault pit.
With the expansion, the Meadowbank mine is now
expected to be in production until the third quarter of 2018
(approximately one year longer than originally forecast). The
extension of the Meadowbank mine life is expected to help bridge
the production gap between the end of production at Meadowbank and
the potential start of production at a satellite operation at
Amaruq (not yet approved for construction).
The Meadowbank production profile has been
revised to reflect the need for additional waste stripping
associated with the pit extension. As previously reported,
the revised production profile is shown below:
| |
|
|
|
|
|
|
2015 |
|
|
2016 |
|
|
2017 |
|
|
2018 |
| |
February 2015 Guidance (gold ounces) |
|
|
|
|
|
400,000 |
|
|
365,000 |
|
|
290,000 |
|
|
n/a |
| |
July 2015 Guidance (gold ounces) |
|
|
|
|
|
400,000 |
|
|
310,000 |
|
|
345,000 |
|
|
130,000 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With additional mining equipment now in place,
better planning and maintenance, revised bench heights, and shorter
waste haulage distances, total tonnage moved increased by
approximately 30% in the third quarter of 2015. The Company expects
to exceed the previously planned stripping rate going forward,
which could potentially provide additional production flexibility
in the future.
Based on a new mining sequence in the Portage
and Vault pits, production at Meadowbank in the fourth quarter of
2015 is expected to be similar to production in the third
quarter.
Amaruq Project - Drilling Expands Scope of Whale Tail
Deposit; Positive Results from the V Zone Area; Phase Two
Exploration Program Now Completed
Agnico Eagle has a 100% interest in the Amaruq
project. The large property consists of 114,761 hectares,
approximately 50 kilometres northwest of the Meadowbank mine.
In August 2015, the Company announced
an updated inferred mineral resource estimate as of June 30, 2015 of 2.0 million ounces gold (9.7
million tonnes grading 6.47 g/t gold).
The phase two drilling program for 2015 was
completed in mid-October. Total drilling at Amaruq for the
year was 108,000 metres (378 holes) completed. This release
incorporates some of the drill results received since the last
results were released on August 19,
2015. The latest drill results are from the main Whale
Tail deposit including the east-plunging high-grade shoot and the
former gap area between Whale Tail West and Mammoth Lake. As
well, there are recent exploration drill results from the V
zone. The 2016 drill program is expected to start in
February.
Phase Two Drill Results Continue to Expand
Mineralized Zones
The phase two 2015 drilling program at the
Amaruq project began in July with several purposes, including
step-out drilling to link Whale Tail and Mammoth Lake
mineralization; testing the down-plunge extent of the ore shoot in
the east of Whale Tail; and extending the I, V and R zones.
Recent intercepts from the project are set out
in the table below and the drill hole collars are located on the
Amaruq project local geology map. The Whale Tail deposit
pierce points are shown on the Whale Tail composite longitudinal
section, while the coordinates from the V zone drill-hole collars
are given in a second table. All intercepts reported for the
Amaruq project show capped grades over estimated true widths, based
on a preliminary geological interpretation that is being updated as
new information becomes available with further drilling.
Recent exploration drill results from the Whale Tail (WT)
deposit and the V zone area, Amaruq project
| Drill hole |
Location |
From
(metres) |
To
(metres) |
Depth
of
midpoint
below
surface
(metres) |
Estimated
true width
(metres) |
Gold grade
(g/t)
(uncapped) |
Gold
grade (g/t)
(capped)* |
| AMQ15-347 |
WT |
444.0 |
461.8 |
383 |
11.4 |
6.3 |
6.3 |
| AMQ15-368 |
V zone |
23.0 |
28.0 |
19 |
3.8 |
2.8 |
2.8 |
| AMQ15-369 |
WT Shoot |
192.2 |
229.0 |
176 |
18.4 |
8.4 |
8.4 |
| AMQ15-390 |
V zone |
6.7 |
18.0 |
9 |
7.3 |
3.5 |
3.5 |
| and |
|
48.2 |
55.5 |
40 |
5.2 |
90.2 |
30.1 |
| AMQ15-422 |
WT Shoot |
364.0 |
397.0 |
270 |
29.9 |
5.7 |
5.7 |
| including |
|
365.0 |
373.0 |
261 |
7.3 |
10.2 |
10.2 |
| including |
|
388.0 |
397.0 |
279 |
8.2 |
10.0 |
10.0 |
| AMQ15-442 |
WT Shoot |
422.1 |
437.0 |
296 |
12.9 |
8.1 |
8.1 |
| including |
|
431.0 |
435.2 |
298 |
3.6 |
12.6 |
12.6 |
| AMQ15-444 |
WT Shoot |
432.4 |
453.4 |
359 |
14.8 |
6.3 |
6.3 |
| including |
|
448.5 |
453.4 |
366 |
4.2 |
10.3 |
10.3 |
| and |
|
458.7 |
472.2 |
378 |
10.3 |
5.8 |
5.8 |
| AMQ15-448 |
V zone |
150.0 |
154.0 |
111 |
3.9 |
3.8 |
3.8 |
| AMQ15-450 |
WT-Mammoth
gap |
213.5 |
243.0 |
166 |
16.9 |
4.5 |
4.5 |
| including |
|
213.5 |
223.0 |
158 |
6.7 |
7.6 |
7.6 |
| AMQ15-461 |
V zone |
103.6 |
130.5 |
115 |
23.4 |
22.9 |
7.9 |
| including |
|
103.6 |
107.8 |
104 |
3.7 |
8.8 |
8.8 |
| including |
|
115.8 |
121.3 |
117 |
4.8 |
99.4 |
26.4 |
| AMQ15-463 |
WT Shoot |
381.3 |
417.6 |
293 |
29.7 |
6.8 |
6.8 |
| including |
|
399.5 |
414.5 |
298 |
11.5 |
8.8 |
8.8 |
| AMQ15-470 |
WT Shoot |
481.0 |
502.0 |
357 |
16.1 |
6.9 |
6.9 |
| including |
|
495.0 |
502.0 |
362 |
5.4 |
12.6 |
12.6 |
| AMQ15-472 |
V zone |
26.7 |
32.6 |
28 |
5.5 |
4.7 |
4.7 |
| and |
|
40.0 |
49.0 |
41 |
7.8 |
7.2 |
7.2 |
| AMQ15-491 |
V zone |
169.3 |
174.4 |
155 |
3.6 |
33.8 |
21.1 |
| *Holes at Amaruq use a capping factor of 60 g/t
gold. |
| |
Amaruq project exploration drill collar coordinates of
selected holes
| |
Drill collar coordinates* |
| Drill hole ID |
UTM North |
UTM East |
Elevation
(metres above
sea level) |
Azimuth |
Dip
(degrees) |
Length
(metres) |
| AMQ15-368 |
7256422 |
606800 |
160 |
143 |
-51 |
444 |
| AMQ15-390 |
7256476 |
606882 |
158 |
142 |
-50 |
411 |
| AMQ15-448 |
7256294 |
607129 |
156 |
323 |
-45 |
192 |
| AMQ15-461 |
7256294 |
606973 |
158 |
319 |
-78 |
218 |
| AMQ15-472 |
7256407 |
606874 |
160 |
322 |
-67 |
117 |
| AMQ15-491 |
7256303 |
606721 |
162 |
166 |
-63 |
249 |
| * Coordinate System UTM Nad 83 zone 14 |
| |
Amaruq local geology map
Whale Tail Deposit Composite Longitudinal
Section
Recent drilling has confirmed that the Whale Tail
and Mammoth zones form a single mineralized system at least 2.3
kilometres long, between surface and locally to a depth of 450
metres. A new intercept lies in between several previously
reported intercepts filling the former gap between Whale Tail and
the Mammoth Lake mineralization. Hole AMQ15-450 yielded 4.5
g/t gold over 16.9 metres at 166 metres depth including 7.6 g/t
gold over 6.7 metres. This area will continue to be
investigated in 2016. The mineralized system remains open at
depth and along strike.
Drilling from the opposite direction (north to
south) has enhanced the understanding of the geometry of the
deposit. Within the Whale Tail deposit is a thickened
higher-grade ore shoot that is at least one kilometre long.
This cigar-shaped shoot extends from surface (Whale Tail West)
plunging shallowly eastward to a depth of 380 metres (Whale Tail
East). The ore shoot remains open. Six recent
intercepts within this shoot, from west to east, are hole AMQ15-369
that intersected 8.4 g/t gold over 18.4 metres at 176 metres depth,
hole AMQ15-463 that yielded 6.8 g/t gold over 29.7 metres at 293
metres depth, hole AMQ15-422 that intersected 5.7 g/t gold over
29.9 metres at 270 metres depth, hole AMQ15-442 that intersected
8.1 g/t gold over 12.9 metres at 296 metres depth, hole AMQ15-470
that intersected 6.9 g/t gold over 16.1 metres at 357 metres depth
and hole AMQ15-444, which yielded two intercepts 6.3 g/t gold over
14.8 metres at 359 metres depth, and 5.8 g/t gold over 10.3 metres
at 378 metres depth. (Note that holes AMQ15-369 and AMQ15-444
were drilled from the south.)
The results described for the Whale Tail deposit
are expected to have a positive impact on the size of the upcoming
resources estimate for the Amaruq project.
Recent drilling and mapping has shown that the V
zone is a significant mineralized structure dipping shallowly to
the southeast, with locally abundant visible gold. The
structure has been identified from outcrop on surface to a depth of
155 metres in recent drilling; it remains open at depth and
laterally. Hole AMQ15-390 intersected the structure yielding
30.1 g/t gold over 5.2 metres at 40 metres depth.
Approximately 100 metres to the south of this intercept, hole
AMQ15-461 yielded 7.9 g/t gold over 23.4 metres at 115 metres
depth. Approximately 150 metres southwest of hole AMQ15-390
was a third high-grade intersection in the V zone: hole AMQ15-491
intersected 21.1 g/t gold over 3.6 metres at 155 metres depth.
Other results from the V zone are included in
the intercepts table above. These results will lead to a
reinterpretation of the I, V, and R zones, which could have a
positive impact on the year-end resource estimate. Although
additional drilling will be required, the Company believes that the
V zone could potentially be a second source of open pit ore at
Amaruq.
Engineering and environmental baseline studies
are underway to support the permitting process for the Amaruq
project as a satellite open pit operation to the Meadowbank
mine. The most recent drilling at depth in Whale Tail also
indicates that this deposit hosts high-grade intercepts below the
preliminary ultimate pit shell, suggesting that Whale Tail has
underground potential. An application to construct an
all-weather access road between Meadowbank and the Amaruq site was
filed in the first quarter of 2015 and is currently working its way
through the Nunavut permitting
process.
Meliadine Project - License B Granted;
Regional Land Holdings Expanded
The Meliadine gold project was acquired in
July 2010 and is the Company's
largest development project based on mineral reserves and mineral
resources. The Company has a 100% interest in the
111,757-hectare property, which is linked to the town of
Rankin Inlet in Nunavut by a 25-kilometre all-weather access
road.
In March 2015, the
Company completed and filed with Canadian securities regulators an
updated National Instrument 43-101 ("NI 43-101") technical report
on the Meliadine gold project. The updated technical study
was based on extracting only the 3.3 million ounces of gold in
proven and probable mineral reserves (13.9 million tonnes of ore at
7.44 g/t gold), which is all contained in the Tiriganiaq and Wesmeg
deposits.
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 numerous other known gold occurrences in the
80-kilometre-long greenstone belt that require further
evaluation.
Internal studies are ongoing to evaluate the
potential to extract additional ounces from the Tiriganiaq and
Wesmeg/Normeg deposits, which could potentially extend the mine
life, improve the project economics, and increase the after-tax
internal rate of return. These studies are expected to be
completed in the first half of 2016.
At the end of the third quarter of 2015,
approximately 1,960 metres of underground development had been
completed, and additional underground equipment has been
transported to site to complete the 2015 plan that calls for total
underground development of approximately 2,500 metres. This
development will allow for more cost-effective exploration and
conversion drilling of the deeper parts of the Tiriganiaq and
Wesmeg/Normeg deposits and help to optimize potential mining
plans.
On July 13, 2015,
the Kivalliq Inuit Association and Agnico Eagle signed the Inuit
Impact Benefit Agreement ("IIBA") for the Meliadine gold
project. The IIBA addresses protection of Inuit values,
culture and language, protection of the land, water and wildlife,
provides financial compensation to Inuit over the mine life, and
contains provision for training, Inuit employment and
contracting.
On October 5,
2015, the Nunavut Water Board issued the permit (License B)
for Meliadine pre-development work. License A, which is
required for production activities, is expected to be granted in
the second quarter of 2016.
The timing of future capital expenditures on the
Meliadine project beyond 2015 and the determination of whether to
build a mine at Meliadine are subject to approval by Agnico Eagle's
Board of Directors, which will be based on prevailing market
conditions and outcomes of the various potential scenarios being
evaluated.
Acquisition of New Properties in Nunavut
Agnico Eagle is currently studying options and
alternatives in Nunavut to
capitalize on the large and growing mineral resource in the
region. As part of this initiative, the Company has recently
staked claims totaling 68,012 hectares on properties to the
west-northwest of the project, on the continuation of the
greenstone belt that hosts the Meliadine deposits.
This summer, an airborne VTEM magnetic and
electromagnetic survey was flown over the new properties. A
field crew initiated prospecting and sampling of areas with
geophysical signatures typical of iron formation-hosted
Archean/Proto-Proterozoic deposits, similar to those recognized at
Meadowbank, Amaruq and Meliadine projects. Close to 800 rock
samples have been collected from the properties. Initial
results have identified a 2-kilometre-long structure from which 21
rock samples returned values above 1.0 g/t gold including seven
values in excess of 10.0 g/t gold, with a maximum value of 42.0 g/t
gold.
The new properties appear to be geologically
similar to the Meadowbank, Meliadine and Amaruq projects where our
exploration team has demonstrated the effectiveness of a systematic
exploration approach and the strong mineral potential of this part
of Nunavut. Assembling and
analyzing the data collected this summer will assist in preparing a
drill program for 2016 to further investigate the higher potential
areas on the new properties.
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.
Pinos Altos - Strong
Performance Driven by Higher Mill Throughput and Grades
The 100% owned Pinos
Altos mine in northern Mexico achieved commercial production in
November 2009.
The Pinos Altos
mill processed 5,403 tpd in the third quarter of 2015, compared to
5,040 tpd processed in the third quarter of 2014. During the
third quarter of 2015, approximately 49,300 tonnes of ore were
stacked on the leach pad at Pinos
Altos, compared to 143,500 tonnes in the comparable 2014
period.
Minesite costs per tonne at Pinos Altos were $48 in the third quarter of 2015, which is in
line with $48 in the third quarter of
2014. Although minesite costs per tonne are unchanged on a
year-over-year basis, these costs are subject to variations in the
proportion of heap leach ore to milled ore and open pit ore to
underground ore, currency exchange rates and routine movements in
the waste to ore stripping ratio in the open pit mines.
For the first nine months of 2015, the
Pinos Altos mill processed an
average of 5,638 tpd, compared to 5,311 tpd processed in the first
nine months of 2014. Approximately 238,500 tonnes of ore were
stacked on the Pinos Altos leach
pad during the first nine months of 2015, compared to 436,800
tonnes in the prior year period. Minesite costs per tonne
were approximately $46 compared to
$48 per tonne in the first nine
months of 2014 with variance due to the proportion of heap leach to
mill ore and the proportion of underground ore to open pit,
variations in the proportion of waste to ore mined and variations
in the currency exchange rate.
Payable production in the third quarter of 2015
was 47,725 ounces of gold at total cash costs per ounce on a
by-product basis of $392. This
compares with production of 41,155 ounces at total cash costs per
ounce on a by-product basis of $545
in the third quarter of 2014. Higher production in 2015 is
largely due to higher mill throughput and higher grades processed
over the comparable prior year period. The decrease in the year
over year total cash costs per ounce is largely due to increased
gold production and higher silver production (offset in part, by a
decline in realized silver prices) and favourable foreign exchange
rates compared to the prior year period.
In the first nine months of 2015, Pinos Altos produced 148,478 ounces of gold at
total cash costs per ounce of $378 on
a by-product basis. This is in contrast to the first nine
months of 2014 when the mine produced 130,350 ounces of gold at
total cash costs per ounce of $513 on
a by-product basis. The lower cash costs in the first nine
months of 2015 are primarily due to favourable foreign exchange
rates and higher gold and silver production compared to the prior
year period.
The Pinos Altos
shaft-sinking project remains on schedule for completion in
2016. The shaft is currently at a depth of approximately 573
metres, and activities during the third quarter of 2015 focused on
the development of loading stations on levels 27 and 28. When the
shaft is completed (final depth of approximately 603 metres), it
will allow better matching of the mill capacity with the future
mining capacity at Pinos Altos
once the open pit mining operation begins to wind down, as planned
over the next several years.
The Company continues to evaluate a number of
regional satellite opportunities. A 6,000-metre in-fill and
conversion drill program on the Sinter deposit is 95% complete with
assays still pending from about 50% of the holes. Results
received to date indicate that there is good potential to add this
deposit to the Pinos Altos mine
plan beginning in 2020.
Creston Mascota Deposit at Pinos Altos - Initial In-pit Drilling Results
Indicate Potential to Extend Mine Life
The Creston Mascota deposit at Pinos Altos has been operating as a satellite
operation to the Pinos Altos mine
since late 2010.
Approximately 434,300 tonnes of ore were stacked
on the Creston Mascota leach pad during the third quarter of 2015,
compared to approximately 469,200 tonnes stacked in the third
quarter of 2014. In the 2015 period, fewer tonnes were
stacked mainly due to the adverse impact of the rainy season on
roads, loading and dumping zones, and the crushing circuit.
Minesite costs per tonne at Creston Mascota were $14 in the third quarter of 2015, compared to
$17 in the third quarter of 2014.
Costs in the 2015 period were lower due to currency fluctuations,
lower fuel consumption and reduced power requirements compared to
the 2014 period.
For the first nine months of 2015, approximately
1,569,800 tonnes of ore were stacked on the Creston Mascota leach
pad, compared to 1,242,900 tonnes in the prior year period.
In the 2015 period, additional ore was encountered outside the
block model, which resulted in more tonnes being stacked in the
first half of the year compared to the 2014 period.
For the first nine months of 2015, mine site
costs per tonne at Creston
Mascota were $12, compared to $17 per tonne in the first nine months of
2014. Costs were lower in the 2015 period due to more tonnes
stacked and the other reasons outlined above.
Payable gold production at Creston Mascota in
the third quarter of 2015 was 12,716 ounces at total cash costs per
ounce on a by-product basis of $436. This compares to 13,377 ounces at
total cash costs per ounce on a by-product basis of $556 during the third quarter of 2014.
Production was lower in the 2015 period due to fewer tonnes
stacked, compared to the 2014 period. Cash costs were lower
in the 2015 period based on lower minesite costs per tonne (see
above), increased silver production (partially offset by a lower
realized silver price) and a favourable foreign exchange rate
compared to the 2014 period.
Payable gold production for the first nine
months of 2015 was 40,770 ounces at total cash costs per ounce of
$425 on a by-product basis.
This compares to 34,853 ounces at total cash costs per ounce of
$587 on a by-product basis in the
first nine months of 2014. The higher production in the 2015
period was due to more tonnes being stacked (especially in the
first half of 2015) compared to the 2014 period. The lower
costs in the 2015 period are due to higher gold production,
increased silver production (partially offset by a lower realized
silver price) and a favourable foreign exchange rate compared to
the 2014 period.
In the third quarter of 2015, preparation and
top soil recovery at the Phase IV heap leach pad were
completed. The earthworks have been initiated, with
commissioning expected by year-end 2015.
Over its mine life, Creston Mascota has added
approximately 50% (179,000 ounces of contained gold) to its mineral
reserves through infill drilling and improved geological
understanding. In April 2015,
higher grade mineralization was encountered at the bottom of the
pit and outside the Creston Mascota block model. An infill
drill program was completed in the third quarter of 2015 with
encouraging results, and the interpretation of drill hole assays is
ongoing.
In September 2015,
a 3,500-metre infill and conversion drill program commenced on the
Bravo satellite zone. This program
is expected to be completed by year-end 2015. The results of recent
infill drilling in the pit and the potential of nearby satellite
deposits such as Bravo could
extend the projected life of the Creston Mascota operations beyond
2018.
La India - New Record Set
for Quarterly Gold Production
The La India mine property in Sonora,
Mexico, located approximately 70 kilometres from the
Company's Pinos Altos mine, was
acquired in November 2011 through the
purchase of Grayd Resources, which held a 56,000-hectare land
position in the Mulatos Gold belt. Commissioning of the mine
commenced ahead of schedule in the third quarter of 2013 and
commercial production was declared as of February 1, 2014.
Approximately 1,193,900 tonnes of ore were
stacked on the La India leach pad during the third quarter of 2015,
compared to approximately 1,190,100 tonnes stacked in the third
quarter of 2014. Minesite costs per tonne at La India were
$11 in the third quarter of 2015,
compared to the $10 in the third
quarter of 2014. The increase in minesite costs reflect slightly
higher maintenance costs and cyanide consumption (due to the rainy
season) partially offset by lower costs for fuel and labour, and
favourable foreign exchange rates.
In the first nine months of 2015, approximately
3,931,900 tonnes of ore were stacked on the La India leach pad,
compared to approximately 3,346,500 stacked in the first nine
months of 2014. Minesite costs per tonne at La India were
$9 in the first nine months of 2015,
compared to the $8 in the first nine
months of 2014. Tonnage stacked in the 2014 period was lower
given that the operation was still ramping up to full capacity. The
slightly higher costs in the 2015 period are primarily due to the
reasons outlined above.
Payable gold production at La India in the third
quarter of 2015 was 28,604 ounces at total cash costs per ounce of
$436 on a by-product basis
were. Production in the third quarter of 2014 was 20,311
ounces at total cash costs per ounce on a by-product basis of
$547. Production in the 2015
period was positively impacted by rain flushing residual ounces
from the heaps and significantly higher ore grades placed on the
heaps than planned. Total cash costs in the 2015 period were
favourably impacted by higher production volumes and favourable
foreign exchange rates.
For the first nine months of 2015, La India
produced 80,930 ounces of gold at total cash costs per ounce of
$422 on a by-product basis.
This compares to 51,820 ounces at total cash costs per ounce of
$483 on a by-product basis in the
first nine months of 2014. The higher production and lower
costs in the 2015 period are primarily due to the reasons outlined
above.
During the third quarter of 2015, construction
activities on the heap leach expansion were negatively affected by
the extraordinary rains during the period. However, any
delays related to the rains are not expected to affect future
production plans or capital costs.
Approximately 77% of the earthworks have been
finished with full completion expected later in the fourth quarter
of 2015. This leach pad expansion will provide the capacity
for the current planned life-of-mine production at La India and
approximately 5.0 million tonnes of additional stacking.
Construction of the Main Zone haul road was completed during the
third quarter of 2015.
In the third quarter of 2015, several activities
were undertaken to improve the La India block model and potentially
expand the mineral reserves and mineral resource. Infill
drilling and favourable reconciliation data from the first full
year of mining have led to an improved geological model for the
Main Zone oxides. In addition, ongoing metallurgical
investigations and field-proven production experience with the
North Zone sulphides have shown that some of the transition and
sulphide material in the Main Zone and La India Zone may also be
amenable to heap leaching.
Inclusion of sulphide material into the pit
designs at the La India mine has the potential to add further
oxides as well as sulphides into the year-end 2015 mineral reserve
and mineral resource estimate expected to be reported in
mid-February 2016. Any
additions could potentially extend the mine life beyond 2020.
El Barqueno - Drilling Continues with a Focus
on Resource Delineation and Defining New Target Areas
Agnico Eagle has a 100% interest in the El
Barqueno project. The 32,840-hectare property is in the
Guachinango gold-silver mining
district, Jalisco State, Mexico,
approximately 150 kilometres west of the state capital of
Guadalajara. It consists of
three blocks of land: the original El Barqueno package (El Barqueno
I, II and III) acquired from Cayden Resources in November 2014, and two adjacent blocks acquired
from Soltoro Limited in June 2015
(El Rayo and El Tecolote). The Company last reported
exploration results from this project in a news release dated
September 21, 2015.
The El Barqueno project contains a number of
known mineralized zones and several prospects that require further
evaluation. There are currently 10 drill rigs working to
define the limits of the Azteca-Zapoteca, Angostura and Peña de Oro prospects, and delineate an initial
mineral resource estimate for these deposits. Several other
prospects are also under evaluation. An additional drill rig
is testing the Zapote-Mixteca prospect, which has been shown to be
gold-bearing by recent rock sample and trench results.
To the end of the third quarter, 171 holes
(42,940 metres) had been drilled. Drilling will continue at El
Barqueno until the end of the year. The Company expects that
this drilling will lead to the estimation of an initial inferred
mineral resource at the Azteca-Zapoteca, Angostura and Peña de Oro areas to open-pit mineable depths.
The resources are expected to be reported in mid-February 2016.
Conceptual design studies and additional
metallurgical testing are underway at El Barqueno. The
project may host gold-silver deposits that could potentially be
developed into a series of open pits utilizing heap leach
processing, similar to Creston Mascota and the La India mine.
While it is too early to estimate the extent of
the mineral resources and the number of deposits with economic
potential at El Barqueno, the Company already has the experience of
developing cost-efficient mining operations in Mexico, and increasing their size through
successful exploration as well as metallurgical innovation.
This body of knowledge will be applied as El Barqueno continues to
be explored and studied.
Exploration expenditures at El Barqueno in 2015
are currently expected to total approximately $22 million.
Quarterly Dividend Declared
Agnico Eagle's Board of Directors has declared a
quarterly cash dividend of $0.08 per
common share, payable on December 15,
2015 to shareholders of record as of December 1, 2015. Agnico Eagle has declared
a cash dividend every year since 1983.
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 Canada,
Finland and Mexico, with exploration and development
activities in each of these countries as well as in the United States and Sweden. The Company and its shareholders
have full exposure to gold prices due to its long-standing policy
of no forward gold sales. Agnico Eagle has declared a cash
dividend every year since 1983.
Note Regarding Certain Measures of Performance
This news release discloses certain measures,
including ''total cash costs per ounce'' and ''minesite costs per
tonne'', "all-in sustaining costs per ounce" and "adjusted net
income" that are not recognized measures under IFRS. These
data may not be comparable to data presented by other gold
producers. For a reconciliation of these measures to the most
directly comparable financial information presented in the
consolidated financial statements prepared in accordance with IFRS
and for an explanation of how management uses these measures, other
than adjusted net income, see "Reconciliation of Non-GAAP Financial
Performance Measures" below. The 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). 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 (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. 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 are used to
show the full cost of gold production from current
operations. The Company calculates all-in sustaining costs
per ounce of gold produced as the aggregate of total cash costs on
a by-product basis, sustaining capital expenditures (including
capitalized exploration), general and administrative expenses
(including stock options) and reclamation expenses divided by the
amount 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 total cash costs per ounce of gold produced on a
by-product basis except that no adjustment is made for by-product
metal revenues. The Company's methodology for calculating
all-in sustaining costs may differ from to the methodology used by
other producers that disclose all-in sustaining costs. The
Company may change the methodology it uses to calculate all-in
sustaining costs in the future, including in response to the
adoption of formal industry guidance regarding this measure by the
World Gold Council. 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 per ounce 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 exchange rates and
metal prices. This news release also contains information as
to estimated future total cash costs per ounce, all-in sustaining
costs and minesite costs per tonne. The estimates are based
upon the total cash costs per ounce, all-in sustaining costs 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 October 28,
2015. Certain statements contained in this document
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, the words
"anticipate", "estimate", "expect", "forecast", "planned", "will"
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, metal production,
life of mine estimates, production, total cash costs per ounce,
minesite costs per tonne, all-in sustaining costs and cash flows;
the estimated timing and conclusions of technical reports and other
studies; the methods by which ore will be extracted or processed;
statements concerning expansion projects, recovery rates, mill
throughput, and projected exploration expenditures, including costs
and other estimates upon which such projections are based;
estimates of depreciation expense, general and administrative
expense and tax rates; the impact of maintenance shutdowns;
statements regarding timing and amounts of capital expenditures and
other assumptions; estimates of future mineral reserves, mineral
resources, mineral production, optimization efforts and sales;
estimates of mine life; estimates of future mining costs, total
cash costs, minesite costs, all-in sustaining costs and other
expenses; estimates of future capital expenditures and other cash
needs, and expectations as to the funding thereof; statements as to
the projected development of certain ore deposits, including
estimates of exploration, development and production and other
capital costs, and estimates of the timing of such exploration,
development and production or decisions with respect to such
exploration, development and production; estimates of mineral
reserves and mineral resources, and statements and information
regarding anticipated future exploration; the anticipated timing of
events with respect to the Company's mine sites and statements and
information regarding the sufficiency of the Company's cash
resources and other statements and information regarding
anticipated trends with respect to the Company's operations,
exploration and the funding thereof. Such statements and
information reflect the Company's views as at the date of this
document and are subject to certain risks, uncertainties and
assumptions, and undue reliance should not be placed on such
statements and information. 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
material factors and assumptions used in the preparation of the
forward looking statements contained herein, which may prove to be
incorrect, include, but are not limited to, the assumptions set
forth herein and in management's discussion and analysis
("MD&A") and the Company's Annual Information Form ("AIF") for
the year ended December 31, 2014
filed with Canadian securities regulators and that are included in
its Annual Report on Form 40-F for the year ended December 31, 2014 ("Form 40-F") filed with the
U.S. Securities and Exchange Commission (the "SEC") as well as:
that there are no significant disruptions affecting operations;
that production, permitting and expansion at each of Agnico Eagle's
properties proceeds on a basis consistent with current expectations
and plans; that the relevant metal prices, exchange rates and
prices for key mining and construction supplies will be consistent
with Agnico Eagle's 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 and
information. 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 mineral
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; community protests; risks
associated with foreign operations; governmental and environmental
regulation; the volatility of the Company's stock price; and risks
associated with the Company's currency, fuel and by-product metal
derivative strategies. For a more detailed discussion of such
risks and other factors that may affect the Company's ability to
achieve the expectations set forth in the forward-looking
statements contained in this document, see the AIF and MD&A
filed on SEDAR at www.sedar.com and included in the Form 40-F filed
on EDGAR at www.sec.gov, as well as the Company's other filings
with the Canadian securities regulators and the SEC. Other
than as required by law, the Company does not intend, and does not
assume any obligation, to update these forward-looking statements
and information.
Notes to Investors Regarding the Use of Mineral
Resources
Cautionary Note to Investors Concerning
Estimates of Measured and Indicated Mineral Resources
This document 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 SEC does not recognize them. Investors
are cautioned not to assume that any part or all of mineral
deposits in these categories will ever be converted into mineral
reserves.
Cautionary Note to Investors Concerning
Estimates of Inferred Mineral Resources
This document also uses the term "inferred
mineral resources". Investors are advised that while this
term is recognized and required by Canadian regulations, the SEC
does not recognize it. "Inferred mineral resources" have a
great amount of uncertainty as to their existence, and great
uncertainty as to their economic and legal feasibility. It cannot
be assumed that all or any part of an inferred mineral resource
will ever be upgraded to a higher category. Under Canadian rules,
estimates of inferred mineral resources may not form the basis of
feasibility or pre-feasibility studies, except in rare cases.
Investors are cautioned not to assume that part or all of an
inferred mineral resource exists, or is economically or legally
mineable.
Scientific and Technical Data
The scientific and technical information
contained in this news release relating to Northern Business
operations has been approved by Christian
Provencher, Ing., Vice-President, Canada and a "Qualified Person" for the
purposes of NI 43-101. The scientific and technical
information contained in this news release relating to Southern
Business operations has been approved by Tim Haldane, P.Eng., Senior Vice-President,
Operations - USA and Latin America and a "Qualified Person" for the
purposes of NI 43-101. The scientific and technical
information contained in this news release relating to exploration
has been approved by Alain
Blackburn, Ing., Senior Vice-President, Exploration and
Guy Gosselin, Ing., Vice-President,
Exploration each of whom is a "Qualified Person" for the purposes
of NI 43-101.
The scientific and technical information
relating to Agnico Eagle's mineral reserves and mineral resources
contained herein has been approved by Daniel Doucet, Senior Corporate Director,
Reserve Development, Ing., and a qualified person as defined by NI
43-101.
Cautionary Note To U.S. Investors - The
SEC permits U.S. mining companies, in their filings with the SEC,
to disclose only those mineral deposits that a company can
economically and legally extract or produce. Agnico Eagle
reports mineral resource and reserve mineral estimates in
accordance with the CIM guidelines for the estimation,
classification and reporting of mineral resources and mineral
reserves in accordance with the Canadian securities regulatory
authorities' NI 43-101. These standards are similar to those
used by the SEC's Industry Guide No. 7, as interpreted by Staff at
the SEC ("Guide 7"). However, the definitions in NI 43-101 differ
in certain respects from those under Guide 7. Accordingly,
mineral reserve information contained herein may not be comparable
to similar information disclosed by U.S. companies. Under the
requirements of the SEC, mineralization may not be classified as a
"reserve" unless the determination has been made that the
mineralization could be economically and legally produced or
extracted at the time the mineral reserve determination is
made. A "final" or "bankable" feasibility study is required
to meet the requirements to designate mineral reserves under
Industry Guide 7. Agnico Eagle uses certain terms in this
news release, such as "measured", "indicated", and "inferred", and
"resources" that the SEC guidelines strictly prohibit U.S.
registered companies from including in their filings with the
SEC.
In prior periods, mineral reserves for all
properties were typically estimated using historic three-year
average metals prices and foreign exchange rates in accordance with
the SEC guidelines. These guidelines require the use of
prices that reflect current economic conditions at the time of
mineral reserve determination, which the Staff of the SEC has
interpreted to mean historic three-year average prices. Given
the current lower commodity price environment, Agnico Eagle has
decided to use price assumptions that are below the three-year
averages. The assumptions used for the mineral reserves
estimates at all mines and advanced projects as of December 31, 2014 (other than the Canadian
Malartic mine), reported by the Company on February 11, 2015, are $1,150 per ounce gold, $18.00 per ounce silver, $1.00 per pound zinc, $3.00 per pound copper, $0.91 per pound lead and C$/US$, US$/Euro and
MXP/US$ exchange rates of 1.08, 1.30 and 13.00, respectively.
For the mineral reserves estimate at the
Canadian Malartic mine, the Company has decided to continue to
report the mineral reserves estimated as of June 15, 2014, reported by the Company in a news
release dated August 13, 2014, minus
the production to the end of 2014. The assumptions used were
$1,300 per ounce gold, a cut-off
grade between 0.28 g/t and 0.35 g/t gold (depending on the
deposit), and a C$/US$ exchange rate of 1.10.
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.
The mineral reserves presented in this news
release are separate from and not a portion of the mineral
resources.
| Property/Project name and
location |
Date of most recent
Technical Report (NI 43-101)
filed on SEDAR |
| LaRonde, Bousquet & Ellison, Quebec,
Canada |
March 23, 2005 |
| Canadian Malartic, Quebec, Canada |
June 16, 2014 |
| Kittila, Kuotko and Kylmakangas, Finland |
March 4, 2010 |
| Meadowbank, Nunavut, Canada |
February 15, 2012 |
| Goldex, Quebec, Canada |
October 14, 2012 |
| Lapa, Quebec, Canada |
June 8, 2006 |
| Meliadine, Nunavut, Canada |
February 11, 2015 |
| 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 |
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.
| AGNICO EAGLE MINES
LIMITED |
| SUMMARY OF OPERATIONS KEY
PERFORMANCE INDICATORS |
| (thousands of United States
dollars, except where noted) |
| (Unaudited) |
| |
| |
Three Months Ended |
|
Nine Months Ended |
| |
September 30, |
|
September 30, |
| |
2015 |
|
2014 |
|
2015 |
|
2014 |
| Operating margin(i) by
mine: |
|
|
|
|
|
|
|
|
|
|
|
| Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
LaRonde mine |
$ |
32,443 |
|
$ |
14,696 |
|
$ |
95,256 |
|
$ |
86,523 |
| |
Lapa mine |
|
13,813 |
|
|
13,748 |
|
|
39,852 |
|
|
38,140 |
| |
Goldex mine |
|
20,681 |
|
|
17,237 |
|
|
55,459 |
|
|
40,045 |
| |
Meadowbank mine |
|
55,493 |
|
|
52,504 |
|
|
151,670 |
|
|
265,193 |
| |
Canadian Malartic
mine(ii) |
|
44,293 |
|
|
33,224 |
|
|
123,748 |
|
|
36,892 |
| |
Kittila mine |
|
21,528 |
|
|
12,128 |
|
|
65,088 |
|
|
45,315 |
| Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
Pinos Altos mine |
|
37,217 |
|
|
28,837 |
|
|
116,407 |
|
|
101,318 |
| |
Creston Mascota deposit at Pinos
Altos |
|
8,898 |
|
|
8,032 |
|
|
30,275 |
|
|
23,173 |
| |
La India mine(iii) |
|
19,845 |
|
|
13,189 |
|
|
59,269 |
|
|
39,835 |
| Total operating
margin(i) |
|
254,211 |
|
|
193,595 |
|
|
737,024 |
|
|
676,434 |
| Amortization of property, plant and
mine development |
|
157,968 |
|
|
117,396 |
|
|
451,480 |
|
|
294,533 |
| Exploration, corporate and other |
|
110,258 |
|
|
69,884 |
|
|
221,937 |
|
|
195,051 |
| Income (loss) before income and mining
taxes |
|
(14,015) |
|
|
6,315 |
|
|
63,607 |
|
|
186,850 |
| Income and mining taxes (recovery)
expense |
|
(15,309) |
|
|
21,365 |
|
|
23,487 |
|
|
82,597 |
| Net income (loss) for the
period |
$ |
1,294 |
|
$ |
(15,050) |
|
$ |
40,120 |
|
$ |
104,253 |
| Net income (loss) per share —
basic (US$) |
$ |
0.01 |
|
$ |
(0.07) |
|
$ |
0.19 |
|
$ |
0.55 |
| Net income (loss) per share —
diluted (US$) |
$ |
0.01 |
|
$ |
(0.10) |
|
$ |
0.19 |
|
$ |
0.53 |
| Cash flows: |
|
|
|
|
|
|
|
|
|
|
|
| Cash provided by operating
activities |
$ |
143,687 |
|
$ |
71,244 |
|
$ |
475,491 |
|
$ |
504,368 |
| Cash used in investing activities |
$ |
(100,365) |
|
$ |
(131,662) |
|
$ |
(258,733) |
|
$ |
(728,493) |
| Cash provided by (used in) financing
activities |
$ |
7,396 |
|
$ |
(35,943) |
|
$ |
(180,300) |
|
$ |
247,921 |
| Realized prices (US$): |
|
|
|
|
|
|
|
|
|
|
|
| Gold (per ounce) |
$ |
1,119 |
|
$ |
1,249 |
|
$ |
1,173 |
|
$ |
1,284 |
| Silver (per ounce) |
$ |
14.93 |
|
$ |
17.72 |
|
$ |
16.04 |
|
$ |
19.33 |
| Zinc (per tonne) |
$ |
1,909 |
|
$ |
2,365 |
|
$ |
1,973 |
|
$ |
2,227 |
| Copper (per tonne) |
$ |
4,538 |
|
$ |
7,500 |
|
$ |
5,193 |
|
$ |
6,842 |
| Payable
production(iv): |
|
|
|
|
|
|
|
|
|
|
|
| Gold (ounces): |
|
|
|
|
|
|
|
|
|
|
|
| |
Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
LaRonde mine |
|
71,860 |
|
|
37,490 |
|
|
194,760 |
|
|
145,336 |
| |
|
Lapa mine |
|
25,668 |
|
|
24,781 |
|
|
71,038 |
|
|
67,011 |
| |
|
Goldex mine |
|
32,068 |
|
|
27,611 |
|
|
87,780 |
|
|
70,970 |
| |
|
Meadowbank mine |
|
99,425 |
|
|
91,557 |
|
|
279,224 |
|
|
366,162 |
| |
|
Canadian Malartic mine(ii) |
|
76,603 |
|
|
64,761 |
|
|
212,937 |
|
|
76,639 |
| |
|
Kittila mine |
|
46,455 |
|
|
28,230 |
|
|
133,095 |
|
|
98,612 |
| |
Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Pinos Altos mine |
|
47,725 |
|
|
41,155 |
|
|
148,478 |
|
|
130,350 |
| |
|
Creston Mascota deposit at Pinos Altos |
|
12,716 |
|
|
13,377 |
|
|
40,770 |
|
|
34,853 |
| |
|
La India mine(iii) |
|
28,604 |
|
|
20,311 |
|
|
80,930 |
|
|
51,820 |
| Total gold (ounces) |
|
441,124 |
|
|
349,273 |
|
|
1,249,012 |
|
|
1,041,753 |
| Silver (thousands of ounces): |
|
|
|
|
|
|
|
|
|
|
|
| |
Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
LaRonde mine |
|
221 |
|
|
224 |
|
|
619 |
|
|
918 |
| |
|
Lapa mine |
|
1 |
|
|
- |
|
|
3 |
|
|
- |
| |
|
Meadowbank mine |
|
39 |
|
|
34 |
|
|
191 |
|
|
85 |
| |
|
Canadian Malartic mine(ii) |
|
76 |
|
|
66 |
|
|
217 |
|
|
76 |
| |
|
Kittila mine |
|
3 |
|
|
1 |
|
|
8 |
|
|
4 |
| |
Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Pinos Altos mine |
|
606 |
|
|
425 |
|
|
1,744 |
|
|
1,307 |
| |
|
Creston Mascota deposit at Pinos Altos |
|
40 |
|
|
26 |
|
|
109 |
|
|
60 |
| |
|
La India mine(iii) |
|
67 |
|
|
44 |
|
|
208 |
|
|
111 |
| Total Silver (thousands of
ounces) |
|
1,053 |
|
|
820 |
|
|
3,099 |
|
|
2,561 |
| Zinc (tonnes) |
|
739 |
|
|
2,230 |
|
|
2,502 |
|
|
8,083 |
| Copper (tonnes) |
|
1,306 |
|
|
989 |
|
|
3,606 |
|
|
3,601 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Payable metal sold: |
|
|
|
|
|
|
|
|
|
|
|
| Gold (ounces): |
|
|
|
|
|
|
|
|
|
|
|
| |
Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
LaRonde mine |
|
69,143 |
|
|
39,279 |
|
|
189,462 |
|
|
145,494 |
| |
|
Lapa mine |
|
23,331 |
|
|
22,422 |
|
|
67,599 |
|
|
64,035 |
| |
|
Goldex mine |
|
33,004 |
|
|
26,762 |
|
|
88,217 |
|
|
68,624 |
| |
|
Meadowbank mine |
|
100,440 |
|
|
98,604 |
|
|
282,090 |
|
|
364,282 |
| |
|
Canadian Malartic mine(ii)(v) |
|
72,651 |
|
|
60,093 |
|
|
199,433 |
|
|
76,470 |
| |
|
Kittila mine |
|
47,070 |
|
|
28,209 |
|
|
135,436 |
|
|
97,157 |
| |
Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Pinos Altos mine |
|
49,327 |
|
|
41,143 |
|
|
145,162 |
|
|
131,011 |
| |
|
Creston Mascota deposit at Pinos Altos |
|
12,911 |
|
|
12,793 |
|
|
40,847 |
|
|
33,758 |
| |
|
La India mine(iii) |
|
28,983 |
|
|
19,265 |
|
|
79,684 |
|
|
48,922 |
| Total gold (ounces) |
|
436,860 |
|
|
348,570 |
|
|
1,227,930 |
|
|
1,029,753 |
| Silver (thousands of ounces): |
|
|
|
|
|
|
|
|
|
|
|
| |
Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
LaRonde mine |
|
220 |
|
|
249 |
|
|
649 |
|
|
911 |
| |
|
Meadowbank mine |
|
36 |
|
|
32 |
|
|
193 |
|
|
84 |
| |
|
Canadian Malartic mine(ii)(v) |
|
53 |
|
|
57 |
|
|
186 |
|
|
72 |
| |
|
Kittila mine |
|
3 |
|
|
1 |
|
|
7 |
|
|
4 |
| |
Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Pinos Altos mine |
|
620 |
|
|
430 |
|
|
1,682 |
|
|
1,367 |
| |
|
Creston Mascota deposit at Pinos Altos |
|
39 |
|
|
18 |
|
|
107 |
|
|
50 |
| |
|
La India mine(iii) |
|
66 |
|
|
42 |
|
|
205 |
|
|
102 |
| Total Silver (thousands of
ounces) |
|
1,037 |
|
|
829 |
|
|
3,029 |
|
|
2,590 |
| Zinc (tonnes) |
|
650 |
|
|
3,936 |
|
|
2,650 |
|
|
8,067 |
| Copper (tonnes) |
|
1,302 |
|
|
988 |
|
|
3,605 |
|
|
3,604 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Total cash costs per ounce of gold
produced - Co-product basis (US$)(vi): |
|
|
|
|
|
|
|
|
|
|
|
| Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
LaRonde mine |
$ |
701 |
|
$ |
1,316 |
|
$ |
795 |
|
$ |
1,118 |
| |
Lapa mine |
|
522 |
|
|
606 |
|
|
582 |
|
|
689 |
| |
Goldex mine |
|
479 |
|
|
582 |
|
|
546 |
|
|
661 |
| |
Meadowbank mine |
|
604 |
|
|
783 |
|
|
657 |
|
|
566 |
| |
Canadian Malartic
mine(ii) |
|
559 |
|
|
754 |
|
|
609 |
|
|
737 |
| |
Kittila mine |
|
640 |
|
|
952 |
|
|
697 |
|
|
862 |
| Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
Pinos Altos mine |
|
578 |
|
|
724 |
|
|
565 |
|
|
706 |
| |
Creston Mascota deposit at Pinos
Altos |
|
478 |
|
|
589 |
|
|
467 |
|
|
620 |
| |
La India mine(iii) |
|
470 |
|
|
584 |
|
|
462 |
|
|
528 |
| Weighted average total cash costs per
ounce of gold produced |
$ |
587 |
|
$ |
794 |
|
$ |
633 |
|
$ |
716 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Total cash costs per ounce of gold
produced - By-product basis (US$)(vi): |
|
|
|
|
|
|
|
|
|
|
|
| Northern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
LaRonde mine |
$ |
558 |
|
$ |
861 |
|
$ |
620 |
|
$ |
701 |
| |
Lapa mine |
|
522 |
|
|
606 |
|
|
581 |
|
|
689 |
| |
Goldex mine |
|
479 |
|
|
582 |
|
|
546 |
|
|
661 |
| |
Meadowbank mine |
|
598 |
|
|
777 |
|
|
646 |
|
|
561 |
| |
Canadian Malartic
mine(ii) |
|
544 |
|
|
735 |
|
|
593 |
|
|
717 |
| |
Kittila mine |
|
639 |
|
|
951 |
|
|
696 |
|
|
861 |
| Southern Business |
|
|
|
|
|
|
|
|
|
|
|
| |
Pinos Altos mine |
|
392 |
|
|
545 |
|
|
378 |
|
|
513 |
| |
Creston Mascota deposit at Pinos
Altos |
|
436 |
|
|
556 |
|
|
425 |
|
|
587 |
| |
La India mine(iii) |
|
436 |
|
|
547 |
|
|
422 |
|
|
483 |
| Weighted average total cash costs per
ounce of gold produced |
$ |
536 |
|
$ |
716 |
|
$ |
574 |
|
$ |
627 |
| |
|
|
|
|
|
|
|
|
|
|
|
| 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 the previously announced court-approved
plan of arrangement ("the Arrangement"). As a result of the
Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of
Osisko (now Canadian Malartic Corporation) and Canadian
Malartic GP, 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 since the date of
acquisition. |
| |
|
| (iii) |
The La India mine achieved commercial production on
February 1, 2014. |
| |
|
| (iv) |
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. |
| |
|
| (v) |
The Canadian Malartic mine's payable metal sold excludes
quantities of gold reflecting the 5.0% net smelter royalty granted
to Osisko Gold Royalties Ltd., in connection with
the Arrangement. |
| |
|
| (vi) |
Total cash costs per ounce of gold produced is not a recognized
measure under IFRS and this data may not be comparable to data
presented by other gold producers. 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 condensed interim
consolidated statements of income (loss) 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 |
| CONSOLIDATED BALANCE
SHEETS |
| (thousands of United States
dollars, except share amounts, IFRS basis) |
| (Unaudited) |
| |
| |
|
|
|
As at |
|
As at |
| |
|
|
|
September 30, |
|
December
31, |
| |
|
|
|
2015 |
|
2014 |
| |
|
|
|
|
|
|
|
|
| ASSETS |
|
|
|
|
|
|
|
|
| Current assets: |
|
|
|
|
|
|
|
|
| |
Cash and cash equivalents |
|
|
|
$ |
201,964 |
|
$ |
177,537 |
| |
Short-term investments |
|
|
|
|
6,144 |
|
|
4,621 |
| |
Restricted cash |
|
|
|
|
19,499 |
|
|
33,122 |
| |
Trade receivables |
|
|
|
|
5,899 |
|
|
59,716 |
| |
Inventories |
|
|
|
|
490,833 |
|
|
446,660 |
| |
Income taxes recoverable |
|
|
|
|
58,473 |
|
|
1,658 |
| |
Available-for-sale
securities |
|
|
|
|
31,960 |
|
|
56,468 |
| |
Fair value of derivative financial
instruments |
|
|
|
|
321 |
|
|
4,877 |
| |
Other current assets |
|
|
|
|
171,835 |
|
|
123,401 |
| Total current assets |
|
|
|
|
986,928 |
|
|
908,060 |
| Non-current assets: |
|
|
|
|
|
|
|
|
| |
Restricted cash |
|
|
|
|
765 |
|
|
20,899 |
| |
Goodwill |
|
|
|
|
696,809 |
|
|
696,809 |
| |
Property, plant and mine
development |
|
|
|
|
5,082,342 |
|
|
5,155,865 |
| |
Other assets |
|
|
|
|
38,764 |
|
|
27,622 |
| Total assets |
|
|
|
$ |
6,805,608 |
|
$ |
6,809,255 |
| LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
| Current liabilities: |
|
|
|
|
|
|
|
|
| |
Accounts payable and accrued
liabilities |
|
|
|
$ |
251,969 |
|
$ |
209,906 |
| |
Reclamation provision |
|
|
|
|
8,349 |
|
|
6,769 |
| |
Interest payable |
|
|
|
|
21,135 |
|
|
13,816 |
| |
Income taxes payable |
|
|
|
|
9,495 |
|
|
19,328 |
| |
Finance lease obligations |
|
|
|
|
13,533 |
|
|
22,142 |
| |
Current portion of long-term
debt |
|
|
|
|
14,932 |
|
|
52,182 |
| |
Fair value of derivative financial
instruments |
|
|
|
|
14,356 |
|
|
8,249 |
| Total current liabilities |
|
|
|
|
333,769 |
|
|
332,392 |
| Non-current liabilities: |
|
|
|
|
|
|
|
|
| |
Long-term debt |
|
|
|
|
1,203,266 |
|
|
1,322,461 |
| |
Reclamation provision |
|
|
|
|
235,965 |
|
|
249,917 |
| |
Deferred income and mining tax
liabilities |
|
|
|
|
838,572 |
|
|
797,192 |
| |
Other liabilities |
|
|
|
|
38,780 |
|
|
38,803 |
| Total liabilities |
|
|
|
|
2,650,352 |
|
|
2,740,765 |
| EQUITY |
|
|
|
|
|
|
|
|
| |
Common shares: |
|
|
|
|
|
|
|
|
| |
|
Outstanding - 217,647,221 common shares issued,
less 233,525 shares held in trust |
|
|
|
|
4,695,297 |
|
|
4,599,788 |
| |
Stock options |
|
|
|
|
213,602 |
|
|
200,830 |
| |
Contributed surplus |
|
|
|
|
37,254 |
|
|
37,254 |
| |
Deficit |
|
|
|
|
(791,153) |
|
|
(779,382) |
| |
Accumulated other comprehensive
income |
|
|
|
|
256 |
|
|
10,000 |
| Total equity |
|
|
|
|
4,155,256 |
|
|
4,068,490 |
| Total liabilities and equity |
|
|
|
$ |
6,805,608 |
|
$ |
6,809,255 |
| |
|
|
|
|
|
|
|
|
| AGNICO EAGLE MINES
LIMITED |
| CONSOLIDATED STATEMENTS OF
INCOME (LOSS) |
| (thousands of United States
dollars, except per share amounts, IFRS basis) |
| (Unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
Three Months Ended |
|
Nine Months Ended |
| |
|
|
|
September 30, |
|
September 30, |
| |
|
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenues from mining operations |
|
|
|
$ |
508,795 |
|
$ |
463,388 |
|
$ |
1,502,500 |
|
$ |
1,393,676 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| COSTS, EXPENSES AND OTHER INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Production(i) |
|
|
|
|
254,584 |
|
|
269,793 |
|
|
765,476 |
|
|
717,242 |
| Exploration and corporate development |
|
|
|
|
37,085 |
|
|
20,521 |
|
|
84,352 |
|
|
41,566 |
| Amortization of property, plant and mine
development |
|
|
|
|
157,968 |
|
|
117,396 |
|
|
451,480 |
|
|
294,533 |
| General and administrative |
|
|
|
|
25,675 |
|
|
24,991 |
|
|
74,468 |
|
|
92,776 |
| Impairment loss on available-for-sale
securities |
|
|
|
|
7,076 |
|
|
462 |
|
|
8,106 |
|
|
2,881 |
| Finance costs |
|
|
|
|
19,674 |
|
|
20,852 |
|
|
57,341 |
|
|
55,249 |
| Loss on derivative financial instruments |
|
|
|
|
16,550 |
|
|
7,908 |
|
|
16,290 |
|
|
3,644 |
| Gain on sale of available-for-sale securities |
|
|
|
|
(875) |
|
|
(83) |
|
|
(24,599) |
|
|
(5,372) |
| Environmental remediation |
|
|
|
|
49 |
|
|
8,490 |
|
|
337 |
|
|
9,163 |
| Foreign currency translation loss (gain) |
|
|
|
|
902 |
|
|
(4,679) |
|
|
(6,009) |
|
|
(3,170) |
| Other expenses (income) |
|
|
|
|
4,122 |
|
|
(8,578) |
|
|
11,651 |
|
|
(1,686) |
| Income (loss) before income and mining
taxes |
|
|
|
|
(14,015) |
|
|
6,315 |
|
|
63,607 |
|
|
186,850 |
| Income and mining taxes (recovery)
expense |
|
|
|
|
(15,309) |
|
|
21,365 |
|
|
23,487 |
|
|
82,597 |
| Net income (loss) for the period |
|
|
|
$ |
1,294 |
|
$ |
(15,050) |
|
$ |
40,120 |
|
$ |
104,253 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) per share - basic |
|
|
|
$ |
0.01 |
|
$ |
(0.07) |
|
$ |
0.19 |
|
$ |
0.55 |
| Net income (loss) per share - diluted |
|
|
|
$ |
0.01 |
|
$ |
(0.10) |
|
$ |
0.19 |
|
$ |
0.53 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average number of common shares
outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
|
|
217,182 |
|
|
208,815 |
|
|
215,728 |
|
|
189,498 |
| Diluted |
|
|
|
|
217,712 |
|
|
209,687 |
|
|
216,627 |
|
|
190,481 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Note: |
| (i) |
|
|
|
Exclusive of amortization, which is shown separately. |
| |
|
|
|
|
| AGNICO EAGLE MINES
LIMITED |
| CONSOLIDATED STATEMENTS OF CASH
FLOWS |
| (thousands of United States
dollars, IFRS basis) |
| (Unaudited) |
| |
| |
|
|
|
Three Months Ended |
|
Nine Months Ended |
| |
|
|
|
September 30, |
|
September 30, |
| |
|
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) for the period |
|
|
|
$ |
1,294 |
|
$ |
(15,050) |
|
$ |
40,120 |
|
$ |
104,253 |
| Add (deduct) items not affecting
cash: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Amortization of property, plant and mine
development |
|
|
|
|
157,968 |
|
|
117,396 |
|
|
451,480 |
|
|
294,533 |
| |
Deferred income and mining taxes |
|
|
|
|
37,783 |
|
|
6,982 |
|
|
43,403 |
|
|
26,189 |
| |
Gain on sale of available-for-sale
securities |
|
|
|
|
(875) |
|
|
(83) |
|
|
(24,599) |
|
|
(5,372) |
| |
Stock-based compensation |
|
|
|
|
8,928 |
|
|
7,552 |
|
|
28,777 |
|
|
30,032 |
| |
Impairment loss on available-for-sale
securities |
|
|
|
|
7,076 |
|
|
462 |
|
|
8,106 |
|
|
2,881 |
| |
Foreign currency translation loss (gain) |
|
|
|
|
902 |
|
|
(4,679) |
|
|
(6,009) |
|
|
(3,170) |
| |
Other |
|
|
|
|
4,874 |
|
|
19,065 |
|
|
7,007 |
|
|
26,971 |
| Adjustment for settlement of
reclamation provision |
|
|
|
|
(143) |
|
|
(2,456) |
|
|
(852) |
|
|
(3,491) |
| Changes in non-cash working capital
balances: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Trade receivables |
|
|
|
|
55,296 |
|
|
6,972 |
|
|
53,834 |
|
|
15,225 |
| |
Income taxes |
|
|
|
|
(55,628) |
|
|
4,468 |
|
|
(66,648) |
|
|
24,988 |
| |
Inventories |
|
|
|
|
(71,510) |
|
|
(54,962) |
|
|
(49,475) |
|
|
(25,059) |
| |
Other current assets |
|
|
|
|
(25,761) |
|
|
4,490 |
|
|
(48,784) |
|
|
(315) |
| |
Accounts payable and accrued liabilities |
|
|
|
|
15,959 |
|
|
(26,046) |
|
|
31,812 |
|
|
9,710 |
| |
Interest payable |
|
|
|
|
7,524 |
|
|
7,133 |
|
|
7,319 |
|
|
6,993 |
| Cash provided by operating
activities |
|
|
|
|
143,687 |
|
|
71,244 |
|
|
475,491 |
|
|
504,368 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Additions to property, plant and mine
development |
|
|
|
|
(122,402) |
|
|
(125,442) |
|
|
(316,800) |
|
|
(342,059) |
| Acquisitions, net of cash and cash
equivalents acquired |
|
|
|
|
- |
|
|
- |
|
|
(12,983) |
|
|
(403,509) |
| Net purchases of short-term
investments |
|
|
|
|
(475) |
|
|
(2,600) |
|
|
(1,523) |
|
|
(4,604) |
| Net proceeds from sale of
available-for-sale securities and warrants |
|
|
|
|
4,724 |
|
|
493 |
|
|
61,035 |
|
|
40,635 |
| Purchase of available-for-sale
securities and warrants |
|
|
|
|
- |
|
|
(13,861) |
|
|
(19,433) |
|
|
(27,246) |
| Decrease in restricted cash |
|
|
|
|
17,788 |
|
|
9,748 |
|
|
30,971 |
|
|
8,290 |
| Cash used in investing activities |
|
|
|
|
(100,365) |
|
|
(131,662) |
|
|
(258,733) |
|
|
(728,493) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Dividends paid |
|
|
|
|
(15,374) |
|
|
(14,546) |
|
|
(44,572) |
|
|
(39,459) |
| Repayment of finance lease
obligations |
|
|
|
|
(4,091) |
|
|
(7,672) |
|
|
(17,535) |
|
|
(14,366) |
| Sale-leaseback financing |
|
|
|
|
- |
|
|
- |
|
|
- |
|
|
1,027 |
| Proceeds from long-term
debt |
|
|
|
|
250,000 |
|
|
230,000 |
|
|
325,000 |
|
|
960,000 |
| Repayment of long-term debt |
|
|
|
|
(275,000) |
|
|
(250,707) |
|
|
(501,086) |
|
|
(674,640) |
| Note issuance |
|
|
|
|
50,000 |
|
|
- |
|
|
50,000 |
|
|
- |
| Long-term debt financing |
|
|
|
|
(1,493) |
|
|
(2,127) |
|
|
(1,493) |
|
|
(2,127) |
| Repurchase of common shares for
restricted share unit plan |
|
|
|
|
- |
|
|
- |
|
|
(11,899) |
|
|
(7,518) |
| Proceeds on exercise of stock
options |
|
|
|
|
1,052 |
|
|
6,538 |
|
|
14,010 |
|
|
16,994 |
| Common shares issued |
|
|
|
|
2,302 |
|
|
2,571 |
|
|
7,275 |
|
|
8,010 |
| Cash provided by (used in) financing
activities |
|
|
|
|
7,396 |
|
|
(35,943) |
|
|
(180,300) |
|
|
247,921 |
| Effect of exchange rate changes on
cash and cash equivalents |
|
|
|
|
(7,085) |
|
|
(4,385) |
|
|
(12,031) |
|
|
(4,074) |
| Net increase (decrease) in cash and
cash equivalents during the period |
|
|
|
|
43,633 |
|
|
(100,746) |
|
|
24,427 |
|
|
19,722 |
| Cash and cash equivalents,
beginning of period |
|
|
|
|
158,331 |
|
|
259,569 |
|
|
177,537 |
|
|
139,101 |
| Cash and cash equivalents, end of
period |
|
|
|
$ |
201,964 |
|
$ |
158,823 |
|
$ |
201,964 |
|
$ |
158,823 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| SUPPLEMENTAL CASH FLOW
INFORMATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest paid |
|
|
|
$ |
10,358 |
|
$ |
13,513 |
|
$ |
46,256 |
|
$ |
43,969 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income and mining taxes
paid |
|
|
|
$ |
9,258 |
|
$ |
16,911 |
|
$ |
47,356 |
|
$ |
38,232 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| AGNICO EAGLE
MINES LIMITED |
| RECONCILIATION
OF NON-GAAP FINANCIAL PERFORMANCE MEASURES |
| (thousands of
United States dollars, except where noted) |
|
(Unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
|
| Total Production
Costs by Mine |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
(thousands of United
States
dollars) |
|
|
|
|
|
|
|
|
|
|
|
| LaRonde mine |
$ |
49,243 |
|
$ |
47,070 |
|
$ |
140,242 |
|
$ |
141,107 |
| Lapa mine |
|
12,279 |
|
|
13,887 |
|
|
39,919 |
|
|
43,593 |
| Goldex mine |
|
16,120 |
|
|
16,222 |
|
|
47,900 |
|
|
47,486 |
| Meadowbank mine |
|
57,404 |
|
|
72,838 |
|
|
181,387 |
|
|
203,725 |
| Canadian Malartic mine(i) |
|
42,008 |
|
|
47,882 |
|
|
125,380 |
|
|
66,215 |
| Kittila mine |
|
31,116 |
|
|
23,963 |
|
|
93,892 |
|
|
80,347 |
| Pinos Altos mine |
|
26,845 |
|
|
29,293 |
|
|
80,824 |
|
|
90,652 |
Creston Mascota deposit at
Pinos Altos |
|
6,101 |
|
|
7,644 |
|
|
19,208 |
|
|
20,278 |
| La India mine(ii) |
|
13,468 |
|
|
10,994 |
|
|
36,724 |
|
|
23,839 |
Production costs per the
interim
condensed consolidated
statements of income (loss) |
$ |
254,584 |
|
$ |
269,793 |
|
$ |
765,476 |
|
$ |
717,242 |
| |
| |
Reconciliation of
Production Costs to Total Cash Costs per Ounce of Gold
Produced(iii) by Mine and Reconciliation of
Production
Costs to Minesite Costs per Tonne(iv) by
Mine |
| |
| LaRonde Mine -
Total Cash Costs per Ounce of Gold
Produced(iii) |
| |
|
|
|
|
|
|
|
| (thousands of
United States dollars, except as noted) |
Three Months Ended
September 30, 2015 |
|
Three
Months Ended
September 30, 2014 |
|
Nine Months Ended
September 30, 2015 |
|
Nine Months Ended
September 30, 2014 |
| Production costs |
$ |
49,243 |
|
$ |
47,070 |
|
$ |
140,242 |
|
$ |
141,107 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and
other adjustments(v) |
|
1,106 |
|
|
2,273 |
|
|
14,570 |
|
|
21,437 |
| Cash operating costs (co-product
basis) |
$ |
50,349 |
|
$ |
49,343 |
|
$ |
154,812 |
|
$ |
162,544 |
| |
By-product metal
revenues |
|
(10,291) |
|
|
(17,078) |
|
|
(34,125) |
|
|
(60,722) |
| Cash operating costs (by-product
basis) |
$ |
40,058 |
|
$ |
32,265 |
|
$ |
120,687 |
|
$ |
101,822 |
| Gold production (ounces) |
|
71,860 |
|
|
37,490 |
|
|
194,760 |
|
|
145,336 |
| Total cash costs per
ounce of gold produced ($
per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
701 |
|
$ |
1,316 |
|
$ |
795 |
|
$ |
1,118 |
| |
By-product basis |
$ |
558 |
|
$ |
861 |
|
$ |
620 |
|
$ |
701 |
| |
|
|
|
|
|
|
|
|
|
|
|
| LaRonde Mine -
Minesite Costs per Tonne(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
49,243 |
|
$ |
47,070 |
|
$ |
140,242 |
|
$ |
141,107 |
| Inventory and other
adjustments(vi) |
|
(1,454) |
|
|
(3,488) |
|
|
266 |
|
|
326 |
| Minesite operating costs |
$ |
47,789 |
|
$ |
43,582 |
|
$ |
140,508 |
|
$ |
141,433 |
| Minesite operating costs (thousands of
C$) |
C$ |
55,417 |
|
C$ |
47,474 |
|
C$ |
169,680 |
|
C$ |
154,785 |
| Tonnes of ore milled (thousands of
tonnes) |
|
551 |
|
|
426 |
|
|
1,678 |
|
|
1,547 |
| Minesite costs per
tonne (C$)(iv) |
C$ |
101 |
|
C$ |
111 |
|
C$ |
101 |
|
C$ |
100 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Lapa Mine - Total
Cash Costs per Ounce of Gold Produced(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production
costs |
$ |
12,279 |
|
$ |
13,887 |
|
$ |
39,919 |
|
$ |
43,593 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other
adjustments(v) |
|
1,117 |
|
|
1,141 |
|
|
1,407 |
|
|
2,608 |
| Cash operating costs (co-product
basis) |
$ |
13,396 |
|
$ |
15,028 |
|
$ |
41,326 |
|
$ |
46,201 |
| |
By-product metal revenues |
|
(2) |
|
|
(3) |
|
|
(20) |
|
|
(6) |
| Cash operating costs (by-product
basis) |
$ |
13,394 |
|
$ |
15,025 |
|
$ |
41,306 |
|
$ |
46,195 |
| Gold production (ounces) |
|
25,668 |
|
|
24,781 |
|
|
71,038 |
|
|
67,011 |
| Total cash costs per ounce of gold
produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product
basis |
$ |
522 |
|
$ |
606 |
|
$ |
582 |
|
$ |
689 |
| |
By-product basis |
$ |
522 |
|
$ |
606 |
|
$ |
581 |
|
$ |
689 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Lapa Mine -
Minesite Costs per Tonne(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
12,279 |
|
$ |
13,887 |
|
$ |
39,919 |
|
$ |
43,593 |
| Inventory and other
adjustments(vi) |
|
406 |
|
|
1,086 |
|
|
297 |
|
|
2,544 |
| Minesite operating costs |
$ |
12,685 |
|
$ |
14,973 |
|
$ |
40,216 |
|
$ |
46,137 |
| Minesite operating costs (thousands of
C$) |
C$ |
16,614 |
|
C$ |
16,310 |
|
C$ |
50,610 |
|
C$ |
50,492 |
| Tonnes of ore milled (thousands of
tonnes) |
|
146 |
|
|
157 |
|
|
424 |
|
|
477 |
| Minesite costs per tonne
(C$)(iv) |
C$ |
114 |
|
C$ |
104 |
|
C$ |
119 |
|
C$ |
106 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Goldex Mine -
Total Cash Costs per Ounce of Gold
Produced(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
16,120 |
|
$ |
16,222 |
|
$ |
47,900 |
|
$ |
47,486 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other
adjustments(v) |
|
(744) |
|
|
(147) |
|
|
66 |
|
|
(559) |
| Cash operating costs
(co-product basis) |
$ |
15,376 |
|
$ |
16,075 |
|
$ |
47,966 |
|
$ |
46,927 |
| |
By-product metal revenues |
|
(2) |
|
|
(5) |
|
|
(15) |
|
|
(16) |
| Cash operating costs (by-product
basis) |
$ |
15,374 |
|
$ |
16,070 |
|
$ |
47,951 |
|
$ |
46,911 |
| Gold production (ounces) |
|
32,068 |
|
|
27,611 |
|
|
87,780 |
|
|
70,970 |
| Total cash costs per ounce of gold
produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
479 |
|
$ |
582 |
|
$ |
546 |
|
$ |
661 |
| |
By-product basis |
$ |
479 |
|
$ |
582 |
|
$ |
546 |
|
$ |
661 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Goldex Mine -
Minesite Costs per Tonne(iv) |
| |
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months Ended |
|
Nine Months Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
16,120 |
|
$ |
16,222 |
|
$ |
47,900 |
|
$ |
47,486 |
| Inventory and other
adjustments(vi) |
|
(1,497) |
|
|
(175) |
|
|
(1,064) |
|
|
(507) |
| Minesite operating costs |
$ |
14,623 |
|
$ |
16,047 |
|
$ |
46,836 |
|
$ |
46,979 |
| Minesite operating costs (thousands of
C$) |
C$ |
19,168 |
|
C$ |
17,481 |
|
C$ |
58,803 |
|
C$ |
51,414 |
| Tonnes of ore milled (thousands of tonnes) |
|
570 |
|
|
538 |
|
|
1,741 |
|
|
1,542 |
| Minesite costs per tonne (C$)(iv) |
C$ |
34 |
|
C$ |
32 |
|
C$ |
34 |
|
C$ |
33 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Meadowbank Mine -
Total Cash Costs per Ounce of Gold
Produced(iii) |
| |
|
|
|
|
|
|
|
|
| |
Three Months
Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
57,404 |
|
$ |
72,838 |
|
$ |
181,387 |
|
$ |
203,725 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other
adjustments(v) |
|
2,642 |
|
|
(1,136) |
|
|
2,088 |
|
|
3,344 |
| Cash operating costs (co-product basis) |
$ |
60,046 |
|
$ |
71,702 |
|
$ |
183,475 |
|
$ |
207,069 |
| |
By-product metal revenues |
|
(543) |
|
|
(570) |
|
|
(3,210) |
|
|
(1,615) |
| Cash operating costs (by-product basis) |
$ |
59,503 |
|
$ |
71,132 |
|
$ |
180,265 |
|
$ |
205,454 |
| Gold production (ounces) |
|
99,425 |
|
|
91,557 |
|
|
279,224 |
|
|
366,162 |
| Total cash costs per ounce of gold
produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
604 |
|
$ |
783 |
|
$ |
657 |
|
$ |
566 |
| |
By-product basis |
$ |
598 |
|
$ |
777 |
|
$ |
646 |
|
$ |
561 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Meadowbank Mine -
Minesite Costs per Tonne(iv) |
| |
|
|
|
|
|
|
|
|
|
|
| |
Three
Months Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
57,404 |
|
$ |
72,838 |
|
$ |
181,387 |
|
$ |
203,725 |
| Inventory and other
adjustments(vi) |
|
(1,643) |
|
|
(1,224) |
|
|
(3,717) |
|
|
3,716 |
| Minesite operating costs |
$ |
55,761 |
|
$ |
71,614 |
|
$ |
177,670 |
|
$ |
207,441 |
| Minesite operating costs (thousands of
C$) |
|
71,519 |
|
C$ |
78,009 |
|
C$ |
217,436 |
|
C$ |
227,023 |
| Tonnes of ore milled (thousands of tonnes) |
|
996 |
|
|
1,057 |
|
|
3,005 |
|
|
3,102 |
| Minesite costs per tonne (C$)(iv) |
C$ |
72 |
|
C$ |
74 |
|
C$ |
72 |
|
C$ |
73 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Canadian Malartic
Mine - Total Cash Costs per Ounce of Gold
Produced(i)(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three
Months Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
42,008 |
|
$ |
47,882 |
|
$ |
125,380 |
|
$ |
66,215 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other
adjustments(v) |
|
781 |
|
|
935 |
|
|
4,335 |
|
|
(9,762) |
| Cash operating costs (co-product basis) |
$ |
42,789 |
|
$ |
48,817 |
|
$ |
129,715 |
|
$ |
56,453 |
| By-product metal revenues |
|
(1,134) |
|
|
(1,213) |
|
|
(3,453) |
|
|
(1,541) |
| Cash operating costs (by-product basis) |
$ |
41,655 |
|
$ |
47,604 |
|
$ |
126,262 |
|
$ |
54,912 |
| Gold production (ounces) |
|
76,603 |
|
|
64,761 |
|
|
212,937 |
|
|
76,639 |
| Total cash costs per ounce of gold
produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
559 |
|
$ |
754 |
|
$ |
609 |
|
$ |
737 |
| |
By-product basis |
$ |
544 |
|
$ |
735 |
|
$ |
593 |
|
$ |
717 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Canadian Malartic
Mine - Minesite Costs per Tonne(i)(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three
Months Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
42,008 |
|
$ |
47,882 |
|
$ |
125,380 |
|
$ |
66,215 |
| Inventory and other
adjustments(vi) |
|
52 |
|
|
719 |
|
|
1,784 |
|
|
(10,029) |
| Minesite operating costs |
$ |
42,060 |
|
$ |
48,601 |
|
$ |
127,164 |
|
$ |
56,186 |
| Minesite operating costs (thousands of
C$) |
C$ |
55,010 |
|
C$ |
52,942 |
|
C$ |
160,136 |
|
C$ |
61,491 |
| Tonnes of ore milled (thousands of tonnes) |
|
2,470 |
|
|
2,417 |
|
|
7,117 |
|
|
2,815 |
| Minesite costs per tonne (C$)(iv) |
C$ |
22 |
|
C$ |
22 |
|
C$ |
23 |
|
C$ |
22 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Kittila Mine -
Total Cash Costs per Ounce of Gold
Produced(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three
Months Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
31,116 |
|
$ |
23,963 |
|
$ |
93,892 |
|
$ |
80,347 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other
adjustments(v) |
|
(1,401) |
|
|
2,915 |
|
|
(1,088) |
|
|
4,677 |
| Cash operating costs (co-product basis) |
$ |
29,715 |
|
$ |
26,878 |
|
$ |
92,804 |
|
$ |
85,024 |
| |
By-product metal revenues |
|
(44) |
|
|
(26) |
|
|
(116) |
|
|
(87) |
| Cash operating costs (by-product basis) |
$ |
29,671 |
|
$ |
26,852 |
|
$ |
92,688 |
|
$ |
84,937 |
| Gold production (ounces) |
|
46,455 |
|
|
28,230 |
|
|
133,095 |
|
|
98,612 |
| Total cash costs per
ounce of gold produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
640 |
|
$ |
952 |
|
$ |
697 |
|
$ |
862 |
| |
By-product basis |
$ |
639 |
|
$ |
951 |
|
$ |
696 |
|
$ |
861 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Kittila Mine -
Minesite Costs per Tonne(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three
Months Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
31,116 |
|
$ |
23,963 |
|
$ |
93,892 |
|
$ |
80,347 |
| Inventory and other
adjustments(vi) |
|
(1,442) |
|
|
2,817 |
|
|
(1,243) |
|
|
4,313 |
| Minesite operating costs |
$ |
29,674 |
|
$ |
26,780 |
|
$ |
92,649 |
|
$ |
84,660 |
| Minesite operating costs (thousands of €) |
€ |
26,160 |
|
€ |
20,217 |
|
€ |
81,169 |
|
€ |
62,488 |
| Tonnes of ore milled (thousands of tonnes) |
|
362 |
|
|
235 |
|
|
1,087 |
|
|
790 |
| Minesite costs per tonne (€)(iv) |
€ |
72 |
|
€ |
86 |
|
€ |
75 |
|
€ |
79 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Pinos Altos Mine - Total Cash Costs per Ounce
of Gold Produced(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Three Months Ended |
|
Nine Months Ended |
|
Nine Months Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
26,845 |
|
$ |
29,293 |
|
$ |
80,824 |
|
$ |
90,652 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other adjustments(v) |
|
731 |
|
|
485 |
|
|
3,084 |
|
|
1,395 |
| Cash operating costs (co-product basis) |
$ |
27,576 |
|
$ |
29,778 |
|
$ |
83,908 |
|
$ |
92,047 |
| |
By-product metal revenues |
|
(8,865) |
|
|
(7,344) |
|
|
(27,842) |
|
|
(25,229) |
| Cash operating costs (by-product basis) |
$ |
18,711 |
|
$ |
22,434 |
|
$ |
56,066 |
|
$ |
66,818 |
| Gold production (ounces) |
|
47,725 |
|
|
41,155 |
|
|
148,478 |
|
|
130,350 |
| Total cash costs per ounce of gold produced ($
per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
578 |
|
$ |
724 |
|
$ |
565 |
|
$ |
706 |
| |
By-product basis |
$ |
392 |
|
$ |
545 |
|
$ |
378 |
|
$ |
513 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Pinos Altos Mine - Minesite Costs per
Tonne(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Three Months Ended |
|
Nine Months Ended |
|
Nine Months Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
26,845 |
|
$ |
29,293 |
|
$ |
80,824 |
|
$ |
90,652 |
| Inventory and other
adjustments(vi) |
|
(498) |
|
|
96 |
|
|
449 |
|
|
(1) |
| Minesite operating costs |
$ |
26,347 |
|
$ |
29,389 |
|
$ |
81,274 |
|
$ |
90,651 |
| Tonnes of ore processed (thousands of
tonnes) |
|
546 |
|
|
607 |
|
|
1,778 |
|
|
1,887 |
| Minesite costs per tonne
(US$)(iv) |
$ |
48 |
|
$ |
48 |
|
$ |
46 |
|
$ |
48 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Creston Mascota deposit at Pinos Altos - Total
Cash Costs per Ounce of Gold Produced(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Three Months Ended |
|
Nine Months Ended |
|
Nine Months Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
6,101 |
|
$ |
7,644 |
|
$ |
19,208 |
|
$ |
20,278 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other adjustments(v) |
|
(27) |
|
|
233 |
|
|
(171) |
|
|
1,317 |
| Cash operating costs (co-product
basis) |
$ |
6,074 |
|
$ |
7,877 |
|
$ |
19,037 |
|
$ |
21,595 |
| |
By-product metal revenues |
|
(534) |
|
|
(442) |
|
|
(1,692) |
|
|
(1,152) |
| Cash operating costs (by-product
basis) |
$ |
5,540 |
|
$ |
7,435 |
|
$ |
17,345 |
|
$ |
20,443 |
| Gold production (ounces) |
|
12,716 |
|
|
13,377 |
|
|
40,770 |
|
|
34,853 |
| Total cash costs per ounce of gold
produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
478 |
|
$ |
589 |
|
$ |
467 |
|
$ |
620 |
| |
By-product basis |
$ |
436 |
|
$ |
556 |
|
$ |
425 |
|
$ |
587 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Creston Mascota deposit at Pinos Altos -
Minesite Costs per Tonne(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Three Months Ended |
|
Nine Months Ended |
|
Nine Months Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
6,101 |
|
$ |
7,644 |
|
$ |
19,208 |
|
$ |
20,278 |
| Inventory and other
adjustments(vi) |
|
(137) |
|
|
115 |
|
|
(429) |
|
|
1,033 |
| Minesite operating costs |
$ |
5,964 |
|
$ |
7,759 |
|
$ |
18,779 |
|
$ |
21,311 |
| Tonnes of ore processed (thousands of
tonnes) |
|
434 |
|
|
469 |
|
|
1,570 |
|
|
1,243 |
| Minesite costs per tonne
(US$)(iv) |
$ |
14 |
|
$ |
17 |
|
$ |
12 |
|
$ |
17 |
| |
|
|
|
|
|
|
|
|
|
|
|
| La India Mine - Total Cash Costs per Ounce of
Gold Produced(ii)(iii) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Three Months Ended |
|
Nine Months Ended |
|
Nine Months Ended |
| (thousands of United States
dollars, except as noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
13,468 |
|
$ |
10,994 |
|
$ |
36,724 |
|
$ |
23,839 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other adjustments(v) |
|
(21) |
|
|
869 |
|
|
697 |
|
|
1,685 |
| Cash operating costs (co-product
basis) |
$ |
13,447 |
|
$ |
11,863 |
|
$ |
37,421 |
|
$ |
25,524 |
| |
By-product metal revenues |
|
(975) |
|
|
(746) |
|
|
(3,286) |
|
|
(2,175) |
| Cash operating costs (by-product
basis) |
$ |
12,472 |
|
$ |
11,117 |
|
$ |
34,135 |
|
$ |
23,349 |
| Gold production (ounces) |
|
28,604 |
|
|
20,311 |
|
|
80,930 |
|
|
48,328 |
| Total cash costs per ounce of gold
produced ($ per ounce)(iii): |
|
|
|
|
|
|
|
|
|
|
|
| |
Co-product basis |
$ |
470 |
|
$ |
584 |
|
$ |
462 |
|
$ |
528 |
| |
By-product basis |
$ |
436 |
|
$ |
547 |
|
$ |
422 |
|
$ |
483 |
| |
|
|
|
|
|
|
|
|
|
|
|
| La India Mine - Minesite Costs per
Tonne(ii)(iv) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Three Months
Ended |
|
Nine Months
Ended |
|
Nine Months
Ended |
| (thousands of United States dollars, except as
noted) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
| Production costs |
$ |
13,468 |
|
$ |
10,994 |
|
$ |
36,724 |
|
$ |
23,839 |
| Inventory and other
adjustments(vi) |
|
(161) |
|
|
851 |
|
|
202 |
|
|
1,430 |
| Minesite operating costs |
$ |
13,307 |
|
$ |
11,845 |
|
$ |
36,926 |
|
$ |
25,269 |
| Tonnes of ore processed (thousands
of tonnes) |
|
1,194 |
|
|
1,190 |
|
|
3,932 |
|
|
3,015 |
| Minesite costs per tonne
(US$)(iv) |
$ |
11 |
|
$ |
10 |
|
$ |
9 |
|
$ |
8 |
| 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
Osisko (now Canadian Malartic Corporation) and Canadian
Malartic GP, 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 since the date of
acquisition. |
| |
|
| (ii) |
The La India mine achieved commercial production on
February 1, 2014. 3,492 ounces of payable gold production
were excluded from the calculation of total cash costs per ounce of
gold produced in the nine months ended September 30, 2014 as they
were produced prior to the achievement of commercial
production. |
| |
|
| (iii) |
Total cash costs per ounce of gold produced is not a recognized
measure under IFRS and this data may not be comparable to data
presented by other gold producers. 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 condensed interim
consolidated statements of income (loss) 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. |
| |
|
| (iv) |
Minesite costs per tonne is not a recognized measure under IFRS
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 condensed interim consolidated statements of income
(loss) 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 impacted 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. |
| |
|
| (v) |
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. |
| |
|
| (vi) |
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
(United States dollars per ounce of
gold produced,
except where noted) |
|
|
|
|
|
Three Months Ended
September 30, 2015 |
|
Three
Months Ended
September 30, 2014 |
|
Nine Months Ended
September 30, 2015 |
|
Nine Months Ended
September 30, 2014 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production costs per
the condensed interim consolidated statements
of income (loss) (thousands of United States dollars) |
|
|
|
|
|
$ |
254,584 |
|
$ |
269,793 |
|
$ |
765,476 |
|
$ |
717,242 |
| Adjusted gold production
(ounces)(i) |
|
|
|
|
|
|
441,124 |
|
|
349,273 |
|
|
1,249,012 |
|
|
1,038,261 |
| Production costs per ounce of adjusted
gold production(i) |
|
|
|
|
|
$ |
577 |
|
$ |
772 |
|
$ |
613 |
|
$ |
691 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Inventory and other
adjustments(ii) |
|
|
|
|
|
|
10 |
|
|
22 |
|
|
20 |
|
|
25 |
| Total cash costs per ounce of gold
produced (co-product basis)(iii) |
|
|
|
|
|
$ |
587 |
|
$ |
794 |
|
$ |
633 |
|
$ |
716 |
| |
By-product metal revenues |
|
|
|
|
|
|
(51) |
|
|
(78) |
|
|
(59) |
|
|
(89) |
| Total cash costs per ounce of gold
produced (by-product basis)(iii) |
|
|
|
|
|
$ |
536 |
|
$ |
716 |
|
$ |
574 |
|
$ |
627 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Sustaining capital expenditures (including
capitalized exploration) |
|
|
|
|
|
|
163 |
|
|
267 |
|
|
172 |
|
|
227 |
| |
General and administrative expenses (including
stock options) |
|
|
|
|
|
|
58 |
|
|
72 |
|
|
60 |
|
|
89 |
| |
Non-cash reclamation provision and other |
|
|
|
|
|
|
2 |
|
|
4 |
|
|
2 |
|
|
4 |
| All-in sustaining costs per ounce of
gold produced (by-product basis) |
|
|
|
|
|
$ |
759 |
|
$ |
1,059 |
|
$ |
808 |
|
$ |
947 |
| |
By-product metal revenues |
|
|
|
|
|
|
51 |
|
|
78 |
|
|
59 |
|
|
89 |
| All-in sustaining costs per ounce of
gold produced (co-product basis) |
|
|
|
|
|
$ |
810 |
|
$ |
1,137 |
|
$ |
867 |
|
$ |
1,036 |
| |
| Notes: |
| |
|
| (i) |
The La India mine achieved commercial production on
February 1, 2014. 3,492 ounces of payable gold production
were excluded from the calculation of total cash costs per ounce of
gold produced in the nine months ended September 30, 2014 as they
were produced prior to the achievement of commercial
production. |
| |
|
| (ii) |
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. |
| |
|
| (iii) |
Total cash costs per ounce of gold produced is not a recognized
measure under IFRS and this data may not be comparable to data
presented by other gold producers. 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 condensed interim
consolidated statements of income (loss) 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. |
SOURCE Agnico Eagle Mines Limited