Agnico Eagle 3Q Profit Declines; Output Guidance Hiked
(Kitco News)- Agnico Eagle Mines Ltd.(NYS: AEM, TSX: AEM) late Wednesday reported a smaller profit in the thirdquarter compared to a year ago but increased its production guidance for 2018and 2019.
Net income was $17.1 million,or 7 cents per share, down from $72.5 million, or 31 cents, in the thirdquarter of 2017, the company said.
The July-September resultsincluded non-cashforeign currency translation gains on deferred tax liabilities andnon-recurring tax gains of $11.8 million and non-cash foreign currencytranslation gains, mark-to-market adjustments and derivative gains on financialinstruments of $4.1 million. Excluding these items, adjusted net income was of$1.2 million, or a penny per share, in the third quarter.
Agnico Eagle blamed the lowerprofit on lower gold sales volumes, lower realized gold prices,lower by-product revenue and expected higher costs at several operations,principally at LaRonde, Kittila and the company's Mexican operations. AgnicoEagle said sales were down mainly due to lower gold production from reducedthroughput levels at Meadowbank as the mine transitions through the last fullyear of mining.
Third-quarter gold production was 421,718 at all-insustaining costs of $848 an ounce. Output in the year-ago period was 454,362ounces at AISC of $789.
Sean Boyd, chief executive officer, said the company hasupped guidance.
“We now expect to produce approximately 1.6 million ounces[for 2018], up from our previous forecast of 1.58 million ounces that wasannounced last quarter,” he said. AISC are expected to be at or slightly belowthe guidance mid-point of $890 to $940 an ounce.
"Our Nunavut development projects are progressing well,”Boyd said. “Drilling continues to generate positive exploration results fromthe Amaruq underground deposits and we see potential for a slightly earlierstartup at Meliadine. As a result, we now expect our 2019 gold production toexceed 1.7 million ounces, which was the mid-point of the previous 2019guidance.”
The company maintained a quarterly dividend of 11 cents pershare.
By Allen SykoraFor Kitco News
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