Higher gold production and a US$38.6 million tax recovery sent Agnico-Eagle Mines‘(AEM-T, AEM-N) net income up 88% to US$54.3 million or US35 per share in the first quarter of 2009, up from US$28.9 million, or US20 per share, in the year-ago quarter.
Gold production surged 80% year-on-year to 91,812 ounces in the first quarter. And with three new mines scheduled to come on stream this year and next, Agnico-Eagle believes gold output this year will reach 550,000 ounces to 575,000 ounces and 1.2 million ounces in 2010.
The Lapa mine in northwestern Quebec and the Pinos Altos mine in northern Mexico are on schedule for initial production this year and the Meadowbank mine in Nunavut in Canada’s Arctic will open in the first quarter of 2010.
Total cash costs during the first quarter came in at US$312 per oz, down from minus US$399 per oz. in the first quarter of 2008. Agnico-Eagle forecasts total cash costs for the year to be about US$340 per oz.
The rise in production and total cash costs per ounce in the first quarter were largely due to the start-up of Agnico-Eagle’s new Goldex mine, which does not have byproducts, and also because of lower realized prices for byproducts at the LaRonde mine.
At the end of March, cash and cash equivalents increased to US$208.4 million from the Dec, 31, 2008 balance of $99.4 million. Long term debt was US$415 million at Mar. 31, double the US$200 million debt load the company carried at the end of the first quarter in 2008.
Capital expenditures in the 2009 quarter totaled US$155 million, including US$46 million at Pinos Altos, US$44 million at Meadowbank, US$28 million at Kittila in northern Finland, US$20 million at Lapa and US$15 million at LaRonde in northwestern Quebec.
At presstime in Toronto, Agnico-Eagle was trading at C$52.37 per share. It has a 52-week trading range of C$26.60-$80.74 per share and 155.6 million shares outstanding.
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