AGNICO EAGLE REPORTS THIRD QUARTER 2023 RESULTS - SOLID QUARTERLY GOLD PRODUCTION AND COST PERFORMANCE; WELL POSITIONED TO ACHIEVE ANNUAL COST GUIDANCE AND GOLD PRODUCTION ABOVE THE MID-POINT OF ANNUAL GUIDANCE

2023-10-25

TSXV - TSX Venture Exchange · Gold · Copper · Graphite · Zinc · Canada

Canada NewsWire

Stock Symbol: AEM (NYSE and TSX)

(All amounts expressed in U.S. dollars unless otherwise noted)

TORONTO , Oct. 25, 2023 /CNW/ - Agnico Eagle Mines Limited (NYSE: AEM) (TSX: AEM) ("Agnico Eagle" or the "Company") today reported financial and operating results for the third quarter of 2023.

"Agnico Eagle had another solid quarter with production and costs coming in as expected. The Canadian Malartic and Meadowbank complexes delivered strong results in the quarter, offsetting unscheduled mill downtime at Detour Lake and highlighting the benefit of our diverse portfolio of mines," said Ammar Al-Joundi, Agnico Eagle's President and Chief Executive Officer. "We are expecting a strong finish to the year and based on our year-to-date performance, we are well positioned to achieve our cost guidance and expect gold production to come in above the mid-point of our annual production guidance," added Mr. Al-Joundi.

Third quarter 2023 highlights

Quarterly gold production and cost performance remain solid – Payable gold production 1 in the third quarter of 2023 was 850,429 ounces at production costs per ounce of $893 , total cash costs per ounce 2 of $898 and all-in sustaining costs ("AISC") per ounce 3 of $1,210 Strong quarterly financial results – The Company reported quarterly net income of $0.36 per share in the third quarter of 2023 and adjusted net income 4 of $0.44 per share. Cash provided by operating activities was $1.01 per share ( $1.35 per share before working capital adjustments 5 ) Canadian Malartic and Meadowbank drive solid production – Gold production in the third quarter of 2023 was led by strong production at the Canadian Malartic and Meadowbank complexes as well as the Kittila mine, offsetting lower production at Detour Lake and Fosterville . The strong performance at Canadian Malartic was driven by positive grade reconciliation at the Barnat pit and higher throughput from softer rock conditions Temporary transformer issue at Detour Lake resulted in unscheduled mill downtime – The transformer powering the semi-autogenous grinding ("SAG") mill on one of the two grinding circuits at the Detour Lake mill ("Line 1") failed unexpectedly in August 2023 . Leveraging the procurement network in the Abitibi region, the Company was able to refurbish the failed transformer within 25 days. During the SAG unit downtime on Line 1, the Company operated the Detour Lake mill at approximately 70% of normal operating rates, resulting in lower production in the third quarter of 2023. The mill returned to normal operating levels in the second half of September 2023 . The Company believes Detour Lake is well positioned to achieve the low end of its annual production guidance Supreme Administrative Court of Finland ("SAC") decision on the Kittila operating permit remains pending – The SAC has informed the Company that it will issue its decision on Kittila's operating permit in October 2023 . If the SAC reverses the lower court ruling and reinstates the operating permit at 2.0 million tonnes per annum ("mtpa") by the end of October 2023 , the Company expects Kittila to produce up to an additional 30,000 ounces of gold in the fourth quarter of 2023 as compared to current production guidance. If the SAC does not release its decision by the end of October or upholds the lower court decision and maintains the current operating permit at 1.6 mtpa, the Company will be required to partially suspend its activities in the fourth quarter of 2023 to remain within the permitted rate. Under this scenario, Kittila's annual production is still expected to be within the annual guidance range of between 190,000 and 210,000 ounces of gold, which was based on a rate of 1.6 mtpa Gold production, cost and capital expenditure guidance reiterated for 2023 – Based on operating performance in the first nine months of 2023, the Company is on-track to be above the mid-point of its production guidance for 2023. Expected payable gold production in 2023 remains unchanged at approximately 3.24 to 3.44 million ounces with total cash costs per ounce expected to be between $840 and $890 and AISC per ounce expected to be between $1,140 and $1,190 . Estimated total capital expenditures (excluding capitalized exploration) for 2023 remain at approximately $1.42 billion Update on key value drivers and pipeline projects Odyssey project at the Canadian Malartic complex – Production via the ramp at the Odyssey South deposit increased through the quarter reaching 3,300 tonnes per day ("tpd") in September, approaching the planned mining rate of 3,500 tpd for 2024. With a positive reconciliation of 18% in gold ounces for the first four stopes mined compared to plan, the internal zones continue to provide upside in tonnage and grade at Odyssey South. Shaft sinking activities continued in the third quarter of 2023, reaching a depth of 130 metres at the end of the quarter. Ramp development continued to exceed targets, reaching a depth of 649 metres at the end of the third quarter of 2023. With this strong development performance, the Company is advancing shaft pre-sinking activities. Exploration drilling in the quarter focused on infilling the internal zones at the Odyssey South deposit and mineral resource expansion of the East Gouldie deposit to the east and west Detour Lake – Prior to the transformer failure, the mill availability was at 92%, which was the targeted rate for 2023 and reflected sustained improvements to the maintenance strategy. At the time, throughput was also on track to achieve the expected level of 27.2 mtpa for 2023 and it is now expected to be approximately 25.9 mtpa for 2023. Mill optimization initiatives continued through the quarter with the objective of continuing to increase throughput to 28.0 mtpa by 2025. Drilling continues to investigate the West Pit extension of the deposit, while tighter infill drilling in two test areas confirming continuity of higher grade zones which supports a potential underground mining scenario Hope Bay – At Madrid, six exploration drills continued to advance step-out drilling on a two-kilometre long, previously untested gap between the Suluk and Patch 7 zones. Initial results show the potential to define a new high grade zone, with intercepts up to 15.9 g/t gold over 4.6 metres at 609 metres depth

Executive Chair Transition – The Company installed the Executive Chair board structure at the time of the Merger with Kirkland Lake Gold to assist in managing the integration of the businesses, with the intention to transition to a traditional Chair structure in time. With the integration of Agnico Eagle and Kirkland Lake Gold successfully completed, the Company now announces that Mr. Boyd will transition from Executive Chair to Chair of the board of directors of Agnico Eagle with an effective date of December 31, 2023 . In this new role, the Company will continue to benefit from Mr. Boyd's leadership, decades of experience and strategic vision. Mr. Sokalsky will remain Lead Director and Mr. Parr will remain Vice-Chair A quarterly dividend of $0.40 per share has been declared

| _ | | 1 Payable production of a mineral means the quantity of a mineral produced during a period contained in products that have been 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. 2 Total cash costs per ounce is a non-GAAP ratio that is not a standardized financial measure under IFRS and, unless otherwise specified, is reported on a by-product basis in this news release. For a description of the composition and usefulness of this non-GAAP measure, as well as a reconciliation of total cash costs to production costs on both a by-product and a co-product basis, see "Reconciliation of Non-GAAP Financial Performance Measures" and "Note Regarding Certain Measures of Performance" below. 3 AISC per ounce is a non-GAAP ratio that is not a standardized financial measure under the IFRS and, unless otherwise specified, is reported on a by-product basis in this news release. For a description of the composition and usefulness of this non-GAAP measure, as well as a reconciliation to production costs and for all-in sustaining costs on both a by-product and co-product basis, see "Reconciliation of Non-GAAP Financial Performance Measures" below and "Note Regarding Certain Measures of Performance" below. 4 Adjusted net income and adjusted net income per share are non-GAAP measures that are not standardized financial measures under IFRS. For a description of the composition and usefulness of this non-GAAP measure, as well as a reconciliation to net income and net income per share see "Reconciliation of Non-GAAP Financial Performance Measures"and "Note Regarding Certain Measures of Performance" below. 5 Cash provided by operating activities before working capital adjustments is a non-GAAP measure that is not standardized financial measures under IFRS. For a description of the composition and usefulness of this non-GAAP measure, as well as a reconciliation to net income and net income per share see "Reconciliation of Non-GAAP Financial Performance Measures"and "Note Regarding Certain Measures of Performance" below. |

Third Quarter 2023 Results Conference Call and Webcast Tomorrow

Agnico Eagle's senior management will host a conference call on Thursday, October 26, 2023 at 11:00 AM (E.D.T.) to discuss the Company's third quarter 2023 financial and operating results.

Via Webcast:

A live audio webcast of the conference call will be available on the Company's website www.agnicoeagle.com .

Via Telephone:

For those preferring to listen by telephone, please dial 1-416-764-8659 or toll-free 1-888-664-6392. To ensure your participation, please call approximately five minutes prior to the scheduled start of the call.

Via URL Entry :

To join the conference call without operator assistance, you may register and enter your phone number at https://bit.ly/3CqkUBg to receive an instant automated call back.

Replay Archive:

Please dial 1-416-764-8677 or toll-free 1-888-390-0541, access code 587191#. The conference call replay will expire on November 26, 2023 .

The webcast, along with presentation slides, will be archived for 180 days on the Company's website.

Third Quarter 2023 Production and Cost Results

| Production and Cost Results Summary* | | | | | | | | | | | | | | | | | | Three Months Ended | | Nine Months Ended | | | | | | Sep 30, 2023 | Sep 30, 2022 | | Sep 30, 2023 | Sep 30, 2022 | | Gold production (ounces) | | 850,429 | 816,795 | | 2,536,446 | 2,335,569 | | Gold sales (ounces) | | 843,097 | 830,246 | | 2,489,503 | 2,359,691 | | Production costs per ounce | | $ 893 | $ 804 | | $ 850 | $ 846 | | Total cash costs per ounce | | $ 898 | $ 779 | | $ 857 | $ 769 | | AISC per ounce | | $ 1,210 | $ 1,106 | | $ 1,162 | $ 1,067 |

| * Production results summary reflects i) Agnico Eagle's 50% interest in the Canadian Malartic complex up to and including March 30, 2023 and 100% thereafter and ii) Agnico Eagle's acquisition of the Detour Lake, Macassa and Fosterville mines on February 8, 2022. |

Gold Production

Third Quarter of 2023 – Gold production increased when compared to the prior-year period due to additional production from the acquisition of the remaining 50% of the Canadian Malartic complex following the closing of the transaction with Yamana Gold Inc. (the "Yamana Transaction"), partially offset by lower production at the Detour Lake and Fosterville mines and the LaRonde complex First Nine Months of 2023 – Gold production increased when compared to the prior-year period as a result of a full nine months contribution in 2023 from the Detour Lake, Macassa and Fosterville mines as opposed to 234 days in the first nine months of 2022 following the closing of the merger (the "Merger") with Kirkland Lake Gold Ltd. on February 8, 2022 and the additional production from the acquisition of the remaining 50% of the Canadian Malartic complex, partially offset by lower production at the LaRonde and Fosterville mines

Production Costs per Ounce

Third Quarter of 2023 – Production costs per ounce increased when compared to the prior-year period primarily due to higher minesite costs per tonne resulting from inflation. A detailed description of the minesite costs per tonne at each mine is set out below First Nine Months of 2023 – Production costs per ounce increased when compared to the prior-year period for the same reason as set out above in respect of the third quarter of 2023

Total Cash Costs per Ounce

Third Quarter of 2023 – Total costs per ounce increased when compared to the prior-year period primarily due to higher minesite costs per tonne resulting from inflation and higher royalties resulting from the acquisition of the remaining 50% of the Canadian Malartic complex in the third quarter of 2023. A detailed description of the minesite costs per tonne at each mine is set out below First Nine Months of 2023 – Total cash costs per ounce increased when compared to the prior-year period for the same reasons as set out above in respect of the third quarter of 2023

AISC per Ounce

Third Quarter of 2023 – AISC per ounce increased when compared to the prior-year period due to the same reasons that caused higher total cash costs per ounce during the period First Nine Months of 2023 – AISC per ounce increased when compared to the prior-year period due to the same reasons that caused higher total cash costs per ounce during the period

Third Quarter 2023 Financial Results

| Financial Results Summary | | | | | | | | | | | | | | | | | | Three Months Ended | | Nine Months Ended | | | | | | Sep 30, 2023 | Sep 30, 2022 | | Sep 30, 2023 | Sep 30, 2022 | | Realized gold price ($/ounce) | | $ 1,928 | $ 1,726 | | $ 1,933 | $ 1,821 | | Net income ($ millions) | | $ 178.6 | $ 66.7 | | $ 2,322.3 | $ 476.1 | | Adjusted net income ($ millions) | | $ 219.9 | $ 222.5 | | $ 813.6 | $ 829.1 | | EBITDA 6 ($ millions) | | $ 722.0 | $ 518.8 | | $ 3,878.4 | $ 1,724.4 | | Adjusted EBITDA 6 ($ millions) | | $ 763.3 | $ 674.5 | | $ 2,369.7 | $ 2,076.5 | | Cash provided by operating activities ($ millions) | | $ 502.1 | $ 575.4 | | $ 1,873.7 | $ 1,716.1 | | Cash provided by operating activities before working capital adjustments ($ millions) | | $ 668.7 | $ 558.4 | | $ 1,970.5 | $ 1,630.3 | | Capital expenditures* | | $ 406.4 | $ 428.1 | | $ 1,164.2 | $ 1,079.7 | | Free cash flow 7 ($ millions) | | $ 82.3 | $ 139.8 | | $ 645.3 | $ 578.7 | | Free cash flow before changes in non-cash components of working capital 7 ($ millions) | | $ 248.8 | $ 122.7 | | $ 742.1 | $ 492.9 | | | | | | | | | | Net income per share (basic) | | $ 0.36 | $ 0.15 | | $ 4.78 | $ 1.10 | | Adjusted net income per share (basic) | | $ 0.44 | $ 0.49 | | $ 1.67 | $ 1.92 | | Cash provided by operating activities before working capital adjustments (basic) | | $ 1.35 | $ 1.23 | | $ 4.05 | $ 3.78 | | Cash provided by operating activities (basic) | | $ 1.01 | $ 1.26 | | $ 3.85 | $ 3.98 |

| *Includes capitalized exploration |

Net Income

Third Quarter of 2023 Net income was $178.6 million ( $0.36 per share). This result includes the following items (net of tax): derivative losses on financial instruments of $23.6 million ( $0.04 per share), foreign currency translation loss on deferred tax liabilities of $10.4 million ( $0.02 per share), non-cash foreign currency translation gain of $6.5 million ( $0.01 per share), transaction costs related primarily to the San Nicolas development project joint venture of $4.6 million ( $0.01 per share) and various other adjustment losses of $9.2 million ( $0.02 per share). Excluding the above items results in adjusted net income of $219.9 million or $0.44 per share for the third quarter of 2023. Included in the third quarter of 2023 net income, and not adjusted above, is a non-cash stock option expense of $2.5 million ( $0.01 per share). Net income increased in the third quarter of 2023 compared to the prior-year period primarily due to higher mine operating margins 8 from higher realized gold prices, higher sales volumes resulting from the acquisition of the remaining 50% of Canadian Malartic, a smaller loss on derivative financial instruments and lower income and mining tax expenses, partially offset by higher amortization.

First Nine Months of 2023 – Net income increased in the first nine months of 2023 compared to the prior-year period primarily due to a remeasurement gain at the Canadian Malartic complex resulting from the application of purchase accounting relating to a business combination attained in stages, which requires the remeasurement of the Company's previously held 50% interest in the Canadian Malartic complex to fair value, higher realized gold prices and higher sales volumes. The fair value of the Company's previously held 50% interest and the resulting gain on remeasurement, along with the fair values allocated to assets acquired and liabilities assumed are preliminary, and are subject to adjustment based on further analysis and evaluation over the course of the measurement period which may not exceed 12 months from the acquisition date.

| | | 6 "EBITDA" means earnings before interest, taxes, depreciation, and amortization. EBITDA and adjusted EBITDA are non-GAAP measures or ratios that are not standardized financial measures under IFRS. For a description of the composition and usefulness of this non-GAAP measure, as well as a reconciliation to net income see "Reconciliation of Non-GAAP Financial Performance Measures" and "Note Regarding Certain Measures of Performance" below. 7 Free cash flow and free cash flow before changes in non-cash components of working capital are non-GAAP measures or ratios that are not standardized financial measures under IFRS. For a description of the composition and usefulness of this non-GAAP measure, as well as a reconciliation to Cash provided by operating activities see "Reconciliation of Non-GAAP Financial Performance Measures"and "Note Regarding Certain Measures of Performance" below. 8 Operating margin is a non-GAAP measure that is not a standardized measure under IFRS. For a reconciliation to net income see "Summary of Operations Key Performance Indicators" below. See also "Note Regarding Certain Measures of Performance". |

Adjusted EBITDA

Third Quarter of 2023 – Adjusted EBITDA increased when compared to the prior-year period primarily due to higher mine operating margins from higher sales volumes resulting from the acquisition of the remaining 50% of Canadian Malartic and a smaller loss on derivative financial instruments First Nine Months of 2023 – Adjusted EBITDA increased when compared to the prior-year period primarily due to the reasons set out above

Cash Provided by Operating Activities

Third Quarter of 2023 – Cash provided by operating activities decreased when compared to the prior-year period primarily due to increased working capital requirements from the seasonality of the Nunavut sealift. Cash provided by operating activities before working capital adjustments increased when compared to the prior-year period primarily due to higher revenues from higher sales volumes from the acquisition of the remaining 50% of the Canadian Malartic complex and higher realized gold prices, partially offset by higher production costs First Nine Months of 2023 – Cash provided by operating activities and cash provided by operating activities before working capital adjustments increased when compared to the prior-year period primarily due to higher sales volumes from a full nine months contribution in 2023 from the Detour Lake, Macassa and Fosterville mines as opposed to 234 days in the first nine months of 2022 following the closing of the Merger and higher sales volumes from the acquisition of the remaining 50% of the Canadian Malartic complex

Capital Expenditures

For a discussion of capital expenditures, please see below

Free Cash Flow Before Changes in Non-Cash Components of Working Capital

Third Quarter of 2023 – Free cash flow before changes in non-cash components of working capital increased when compared to the prior-year period due to the reasons described above relating to cash provided by operating activities and lower additions to property, plant and mine development First Nine Months of 2023 – Free cash flow before changes in non-cash components of working capital increased when compared to the prior-year period due to the reasons described above relating to cash provided by operating activities, partially offset by lower additions to property, plant and mine development