(All amounts expressed in U.S. dollars unless otherwise noted)
TORONTO, July 29, 2015 /PRNewswire/ - Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico Eagle" or the "Company") today reported quarterly net income of $10.1 million, or net income of $0.05 per share for the second quarter of 2015. This result includes non-recurring losses of $12.9 million ($0.06 per share), unrealized gains on financial instruments of $9.4 million ($0.04 per share), non-cash foreign currency translation losses of $4.8 million ($0.02 per share), non-cash stock option expense of $4.1 million ($0.02 per share), a non-cash foreign currency translation gain on deferred tax liabilities of $3.2 million ($0.01 per share) and various mark-to-market and other adjustment gains of $0.8 million ($0.01 per share). Excluding these items would result in adjusted net income of $18.5 million or adjusted net income of $0.09 per share for the second quarter of 2015. In the second quarter of 2014, the Company reported net income of $22.2 million or net income of $0.12 per share.
For the first six months of 2015, the Company reported net income of $38.8 million, or $0.18 per share. This compares with the first six months of 2014 when net income was $119.3 million, or $0.66 per share. Financial results in the 2015 period were negatively impacted by lower gold prices (approximately 8% lower) and lower by-product metals revenues.
Second quarter 2015 cash provided by operating activities was $188.3 million ($152.8 million before changes in non-cash components of working capital). This compares to cash provided by operating activities of $182.7 million in the second quarter of 2014 ($136.5 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 24% in gold production.
For the first six months of 2015, cash provided by operating activities was $331.8 million ($329.6 million before changes in non-cash components of working capital), as compared with the first half of 2014 when cash provided by operating activities was $433.1 million ($343.6 million before changes in non-cash components of working capital). The decrease in cash provided by operating activities before changes in working capital during the period was mainly due to a decrease of 8% in gold prices compared to the 2014 period, which more than offset a 17% increase in gold production.
"With continued strong operating performance, favourable local currency foreign exchange rates, and near-term opportunities to increase production at several of our mines, we remain well-positioned to manage the current price volatility in the gold market", said Sean Boyd, Agnico Eagle's Chief Executive Officer. "In these challenging times, we will continue to focus on reducing costs and we will remain measured in our approach to managing and growing our business", added Mr. Boyd.
Second Quarter 2015 highlights
• Quarterly gold production - Payable gold production1 in Q2 2015 was 403,678 ounces of gold at total cash costs2 per ounce on a by-product basis of $601 and all-in sustaining costs3 ("AISC") on a by-product basis of $864 per ounce
• Second consecutive record quarter of precious metal production from Mexican operations - In the second quarter of 2015, payable gold and silver production from Mexican operations was 92,056 ounces and 685,869 ounces, respectively. Total cash costs per ounce of gold on a by-product basis averaged $394
• 2015 production guidance maintained and cost forecasts reduced - Expected gold production for 2015 is maintained at approximately 1.6 million ounces with total cash costs on a by-product basis of $600 to $620 per ounce (previously $610 to $630) and AISC of approximately $870 to $890 per ounce (previously $880 to $900)
• Vault Extension and Goldex Deep 1 approved for mining; 2015 capital for both projects increased by a total of approximately $36 million - The Vault extension is expected to reduce the potential production gap between the end of production at Meadowbank and the start of production at Amaruq (not yet approved for construction) by approximately one year. Goldex Deep 1 adds approximately seven years of production at approximately 100,000 ounces of gold per year
• Drilling at Amaruq's Whale Tail deposit confirms grades and thicknesses; mineralization extended to depth - Highlights include: 13.2 grams per tonne ("g/t") gold over 14.3 metres at 133 metres depth, and 13.9 g/t gold over 11.0 metres at 194 metres depth. The deepest intercept to date on the property yielded 8.8 g/t gold over 6.0 metres at 568 metres depth, almost 200 metres deeper than previous intercepts
• Continued focus on debt reduction - In Q2 2015, $25 million was repaid under the Company's credit facility, C$20 million (reflecting the Company's 50% interest) was repaid under the Canadian Malartic General Partnership (the "Partnership") secured loan facility, and the Canadian Malartic senior unsecured convertible debentures (C$37.5 million, reflecting the Company's 50% interest) were fully converted by the holders. As a result, the Company's indebtedness was reduced by approximately $70 million