Agnico Eagle increases gold production 63% in second quarter, posts $276 million in net income
(Kitco News) - Major global gold miner Agnico Eagle (NYSE: AEM) (TSX: AEM) announced Wednesday that its payable gold production in Q2 2022 was 858,170 ounces, up 63% over 526,006 ounces produced in Q2 2021.
The company said that gold production in the second quarter of 2022, when compared to the prior-year period, was higher primarily due to the inclusion of the production from the Detour Lake, Fosterville and Macassa mines.
This was partially offset by the cessation of gold production in 2022 at the Hope Bay mine following the company's decision to dedicate the infrastructure to exploration activities and lower production at the company's Pinos Altos mine, as a result of lower tonnage sourced from the underground mine.
Agnico Eagle added that production costs per ounce in the second quarter of 2022 were $766, compared to $838 in the prior-year period while total cash costs per ounce in the second quarter of 2022 were $726, compared to $748 in the prior-year period.
The company explained that in the second quarter, production costs per ounce and total cash costs per ounce decreased when compared to the prior-year period primarily due to lower minesite costs per tonne.
In Q2 2022, the company generated net income of $275.8 million, which is an increase of 40% compared to net income of $196.4 million recorded in Q2 2021.
The company said that expected payable gold production in 2022 remains unchanged at between 3.2 and 3.4 million ounces with total cash costs per ounce and AISC per ounce between $725 and $775 and $1,000 and $1,050, respectively.
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Given that inflationary pressures are expected to continue in the second half of 2022, the company said it believes that total cash costs per ounce and AISC per ounce could trend towards the top end of these ranges.
"In the second quarter of 2022 the company set a new quarterly production record driven by both strong operational and safety performance. In Nunavut, Amaruq had a record quarter for both costs and production, and the Ontario mines exceeded forecast. This strong production performance led to better than expected earnings and cashflow and puts us in a good position to deliver on 2022 guidance forecasts, despite ongoing inflationary cost pressures," said Ammar Al-Joundi, Agnico Eagle's President and Chief Executive Officer.
"I am particularly excited by the step-out drilling at Detour which suggests good potential for an underground operation and extensions to the current open pits. A number of opportunities to improve the mining operations and enhance production are currently under evaluation, and the company's long-term vision for Detour Lake is to increase production to 1.0 million ounces per year or more," he added.
Agnico Eagle is a senior Canadian gold mining company, producing precious metals from operations in Canada, Australia, Finland and Mexico. It has a pipeline of exploration and development projects in these countries as well as in the United States and Colombia.