AGNICO EAGLE MINES LTD
For the period ended Dec 31, 2023. Filed Mar 25, 2024.
View on SEC.govAbout this filing
The yearly report of certain Canadian companies, filed under a joint US and Canadian system. It is the main yearly account these companies give US investors, largely as filed in Canada.
FY2023 · Filed Mar 25, 2024
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Contents
EX-99.3 · Key Performance Drivers
Key Performance Drivers
The key drivers of financial performance for Agnico Eagle for the year-ended December 31, 2023 include:
| ● | the spot price of gold, silver, zinc and copper; |
| ● | production volumes; |
| ● | production costs; and |
| ● | US dollar/Canadian dollar, US dollar/Australian dollar, US dollar/Euro and US dollar/Mexican peso exchange rates. |
Details on future drivers of financial performance are discussed in the Outlook section of this MD&A.
Spot Price of Gold, Silver, Zinc and Copper
GOLD ($ per ounce)
| · · · · · · · · · | |||||
|---|---|---|---|---|---|
| · 2023 · 2022 · % Change | |||||
| High price | | $2,078 | | $2,039 | 1.9% |
| Low price | | $1,811 | | $1,629 | 11.2% |
| Average market price | | $1,941 | | $1,800 | 7.8% |
| Average realized price | | $1,946 | | $1,797 | 8.3% |
In 2023, the average market price per ounce of gold was 7.8% higher than in 2022. The Company’s average realized price per ounce of gold in 2023 was 8.3% higher than in 2022.
SILVER ($ per ounce)
| · · · · · · · · · | |||||
|---|---|---|---|---|---|
| · 2023 · 2022 · % Change | |||||
| High price | | $26.07 | | $26.18 | (0.4)% |
| Low price | | $20.09 | | $17.77 | 13.1% |
| Average market price | | $23.35 | | $21.73 | 7.5% |
| Average realized price | | $23.72 | | $21.63 | 9.7% |
In 2023, the average market price per ounce of silver was 7.5% higher than in 2022. The Company’s average realized price per ounce of silver in 2023 was 9.7% higher than in 2022.
| | ||
| ZINC ($ per tonne) | | COPPER ($ per tonne) |
|---|---|---|
| |
Agnico Eagle’s average realized price year-over-year for zinc decreased by 21.5% and the average realized price year-over-year for copper increased by 1.9%.
By-product metals are mainly produced at the LaRonde complex (silver, zinc and copper) and the Pinos Altos mine (silver). Net by-product (primarily silver, zinc and copper) revenue is treated as a reduction of production costs in calculating total cash costs per ounce of gold produced on a by-product basis and all-in sustaining costs per ounce of gold produced on a by-product basis.
Production Volumes and Costs
Changes in production volumes have a direct impact on the Company’s financial results. Payable production of gold was 3,439,654 ounces in 2023, an increase of 9.7% compared with 3,135,007 ounces in 2022. The increase was primarily due to the contribution of production volumes from the Canadian Malartic complex following the Yamana Transaction, which closed on March 31, 2023, and increased production at the Meadowbank complex and the Macassa, Detour Lake and Kittila mines. Partially offsetting the overall increase in gold production was a decrease in gold production at the Fosterville mine and LaRonde complex.
Production costs are discussed in detail in theResults of Operations section below.
Foreign Exchange Rates (Ratio to US$)
The exchange rate of the Canadian dollar, Australian dollar, Euro and Mexican peso relative to the US dollar is an important financial driver for the Company for the following reasons:
| ● | all revenues are earned in US dollars; |
| ● | a significant portion of operating costs at the LaRonde, Canadian Malartic and Meadowbank complexes and the Detour Lake, Macassa, Meliadine and Goldex mines are incurred in Canadian dollars; |
| ● | a significant portion of operating costs at the Fosterville mine are incurred in Australian dollars; |
| ● | a significant portion of operating costs at the Kittila mine are incurred in Euros, and |
| ● | a significant portion of operating costs at the Pinos Altos and La India mines are incurred in Mexican pesos. |
The Company mitigates part of its foreign currency exposure by using currency hedging strategies.
| | | | ||
| CANADIAN DOLLAR | | AUSTRALIAN DOLLAR | | |
|---|---|---|---|---|
| | | | ||
| MEXICAN PESO | | EURO | | |
| | | |
On average, the Canadian dollar and Australian dollar weakened relative to the US dollar in 2023 compared to 2022, decreasing costs denominated in local currency when translated to US dollars for reporting purposes. The Euro and Mexican Peso strengthened relative to the US dollar in 2023 compared with 2022, increasing costs denominated in the local currency when translated into US dollars for reporting purposes.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.