|
Stock Symbol:
AEM (NYSE and TSX)
(All amounts expressed in U.S. dollars unless otherwise
noted)
TORONTO , Oct. 28, 2015 /CNW/ -
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 production
1
in the third quarter of 2015 was 441,124 ounces of gold at
total cash costs
2
per ounce on a by-product basis of $536 and all-in sustaining
costs
3
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". |
3
All-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 tonne
4
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 |
|
|
|
|
|
|
|
|
|
null
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
|
|