Agnico-Eagle Reports Fourth Quarter and Full Year 2012 Results; Record Annual Production and Operating Cash Flows;
/CORRECTED COPY from CNW - Agnico-Eagle Reports Fourth Quarter and Full Year 2012 Results; Record Annual Production and Operating Cash Flows; Provides Three Year Production Guidance and Reserve and Resource Update/
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(All amounts expressed in U.S. dollars unless otherwise noted)
AEM (NYSE and TSX)
TORONTO, Feb. 13, 2013 /PRNewswire/ - Agnico-Eagle Mines Limited ("Agnico-Eagle" or the "Company") (NYSE: AEM) (TSX: AEM) today reported a quarterly net income of $82.8 million, or $0.48 per share for the fourth quarter of 2012. This result includes a $16.5 million ($0.10 per share) gain on the sale of Queenston Mining Inc. shares and a non-cash foreign currency translation gain of $4.5 million ($0.03 per share). These items were partly offset by stock option expense of $7.1 million ($0.04 per share) and a $1.1 million ($0.01 per share) partial write-down of the Creston Mascota heap leach pad. Excluding these items would result in normalized net income of $69.9 million ($0.41 per share) for the fourth quarter of 2012. In the fourth quarter of 2011, the Company reported net quarterly loss of $601.4 million (loss of $3.53 per share), which included a $907.7 million impairment loss on the Meadowbank mine.
Fourth quarter 2012 cash provided by operating activities was $106.0 million ($175.0 million before changes in non-cash components of working capital), down from cash provided by operating activities of $132.0 million in the fourth quarter of 2011 ($179.2 million before changes in non-cash components of working capital), primarily due to larger increases in working capital related to inventory and accounts payable in 2012.
"Congratulations are due to all of our employees as our safety and operating performance company-wide was excellent during 2012. Targets were met, and in many cases, exceeded", said Sean Boyd , President and Chief Executive Officer. "In 2013, we anticipate continuing our solid execution at the current operations and advancing construction on our three near-term growth projects, La India, Goldex and the LaRonde Extension. The new projects, combined with the forecast of higher grades at LaRonde are expected to result in growth of approximately 20% in our gold production from 2013 to 2015. The gold production growth is expected to result in improvements in the unit cost profile through 2015 as well." added Mr. Boyd.
Fourth quarter and full year 2012 highlights include:
•Record annual gold production - record full year gold production of 1,043,811 ounces at total cash costs1 of $640 per ounce for the year, compared to guidance of 1,025,000 ounces at $660 per ounce
•Record annual operating cash flows - cash provided by operating activities up year over year, to $696 million, or $4.06 per share
•Goldex and La India construction according to plan - both projects expected to provide production growth in 2014
•Quarterly dividend up 10% to $0.22 per share - Company has now declared a dividend for 31 consecutive years
•Gold reserves, net of production, maintained at 18.7 million ounces at year end 2012 - inferred resources grow significantly at Kittila and Meliadine
•Kittila expansion approved - expected to add to production profile in the second half of 2015
Agnico-Eagle is pleased to announce that its Board of Directors has approved the payment of a quarterly cash dividend of $0.22 per common share. The next dividend will be paid on March 15, 2013 to shareholders of record as of March 1, 2013. Agnico-Eagle has now declared a cash dividend to its shareholders for 31 consecutive years.
For the full year 2012, the Company recorded net income of $310.9 million, or $1.82 per share. In 2011, Agnico-Eagle recorded a net loss of $568.9 million, or $3.36 per share (a $1.2 billion write-down of mining assets was recorded in 2011 following a re-evaluation of the mining plan at Meadowbank and the suspension of production from the GEZ deposit at Goldex). Compared with the prior year, 2012 earnings were positively affected by consistent performance at all operating mines and significant year over year improvement at Meadowbank.
For 2012, the Company realized a record amount of cash provided by operating activities of $696.0 million ($737.9 million before changes in non-cash components of working capital). This represents an increase over 2011, when cash provided by operating activities totaled $667.2 million ($705.1 million before changes in non-cash components of working capital). The increase was primarily due to significant improvement in cash flow generation from the Meadowbank mine, as well as continued strong performance at Pinos Altos. The overall improvement was in spite of significantly lower by-product revenues and the absence of production from the Goldex mine in 2012.
Payable gold production2 in the fourth quarter of 2012 was 236,535 ounces compared to 227,792 ounces in the fourth quarter of 2011. A detailed description of the production and cost performance by mine may be found later in this document.
Total cash costs for the fourth quarter of 2012 were $769 per ounce versus $671 per ounce for fourth quarter 2011. The increase in total cash costs per ounce in the fourth quarter of 2012 is mainly due to higher costs at LaRonde and Meadowbank and the temporary suspension of operations at Creston Mascota. At LaRonde, the ramp up of tonnage from the higher grade, deeper levels continues to be challenging due to heat and congestion in the mine. Higher total cash costs were realized at Meadowbank as the mine production was from lower grade ore (as planned) during the quarter. The temporary suspension of the relatively low cost Creston Mascota heap leach operation in October of 2012 also negatively impacted total cash costs.
The Company's payable gold production for the full year 2012 was a record 1,043,811 ounces at total cash costs per ounce of $640. This compares to the full year 2011 level of 985,460 ounces at total cash costs per ounce of $580 (which included 135,478 ounces from the low cost Goldex mine; excluding Goldex, 2011 total cash costs from currently operating mines were $609 per ounce). The significant improvement in gold production in 2012 was a result of strong operating results from all of the mines. The increase in total cash costs per ounce in 2012 was primarily due to the impact of lower byproduct credits at LaRonde and larger contribution to overall production from the higher cost Meadowbank mine, partly offset by better cost profiles at Meadowbank and Kittila, when compared to 2011.
1 Total cash costs per ounce is a non-GAAP measure. For a reconciliation to production costs, see Note 1 to the financial statements contained herein. See also "Note Regarding Certain Measures of Performance".
2 Payable production of a mineral means the quantity of mineral produced during a period contained in products that are or will be sold by the Company whether such products are shipped during the period or held as inventory at the end of the period.