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Agnico Eagle (AEM) Beats Earnings and Sales Estimates in Q1

Zacks Equity Research

Agnico Eagle Mines Limited AEM delivered net income of $37 million or 16 cents per share in first-quarter 2019, down from $44.9 million or 19 cents in the year-ago quarter.

Barring one-time items, adjusted earnings per share came in at 14 cents, which beat the Zacks Consensus Estimate of 5 cents.

Agnico Eagle generated revenues worth $532.2 million, down around 8% year over year. The decline was primarily caused by 3.5% fall in gold sales volume along with lower realized gold price. Nevertheless, the figure surpassed the Zacks Consensus Estimate of $513 million.

Agnico Eagle Mines Limited Price, Consensus and EPS Surprise

 

Agnico Eagle Mines Limited Price, Consensus and EPS Surprise | Agnico Eagle Mines Limited Quote

Operational Highlights

Gold production rose 2.3% year over year to 398,217 ounces. Total cash costs per ounce were $623, down roughly 3.9% from $648 in the prior-year quarter.

All-in sustaining costs (AISC) were $836 per ounce, down 6% from the prior-year quarter’s figure of $889.

Financial Position

As of Mar 31, 2019, cash and cash equivalents were around $190 million, down from around $452.3 million a year ago.

Long-term debt was $1,722 million at the end of the first quarter.

Total cash from operating activities amounted to $148.7 million in the reported quarter, down 28.4% year over year.   

Outlook

Agnico Eagle reaffirmed production and cost guidance for 2019. Gold production for the year is projected at 1.75 million ounces. The projection includes pre-commercial production from Meliadine of roughly 60,000 ounces of gold and Amaruq of roughly 40,000 ounces of gold.

Total cash costs per ounce are projected between $620 and $670. AISC is expected in the range of $875-$925 per ounce.

The company expects roughly 55% of expected gold production for 2019 to materialize in the second half of the year.

Price Performance

Agnico Eagle’s shares have lost 2.6% in the past year compared with the industry’s 3.7% decline.

 



Zacks Rank & Key Picks

Agnico Eagle currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space include Sandstorm Gold Ltd. SAND, Flexible Solutions International Inc FSI and Reliance Steel & Aluminum Co. RS.

Sandstorm Gold has an expected earnings growth rate of 200% for the current year and sports a Zacks Rank #1 (Strong Buy). The company’s shares have gained around 9.2% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

Flexible Solutions has an expected earnings growth rate of 171.4% for the current year and carries a Zacks Rank #2. Its shares have surged roughly 100% in the past year.

Reliance Steel has an expected earnings growth rate of 2.4% for the current year and carries a Zacks Rank #2. Its shares have gained around 3.1% in the past year.

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