Agnico Eagle Mines Limited - the largest gold producer in Canada - has just announced its business results for the first quarter of 2025 that far exceeded analysts' expectations, with a record profit thanks to high gold prices.
After the North American stock market closed on April 24, Agnico Eagle (NYSE: AEM, TSX: AEM) reported a net profit in the first quarter of 815 million USD, equivalent to 1.62 USD/share. Adjusted profit reached 770 million USD, equivalent to 1.53 USD/share, far exceeding the average forecast of 1.38 USD/share.
Mr. Ammar Al-Joundi - Chairman and CEO of Agnico Eagle - said: "We have had an excellent start to the year with another quarter achieving strong operational and financial results. This achievement helps us continue to consolidate the accounting balance sheet and prepare for the rest of the year.
We are still focusing on efficiency and cost control to continue expanding profit margins in the context of rising gold prices. This allows us to reinvest in businesses through exploring and developing 5 key projects, while enhancing financial position and increasing benefits for shareholders.
In the first quarter, Agnico Eagle generated 1,044 million USD in cash flow from business activities, equivalent to 2.08 USD/share. Free cash flow reached 594 million USD, equivalent to 1.18 USD/share.
Profit increased sharply thanks to high gold prices and stable costs. Agnico produced 873,794 ounces of gold in the first three months of the year, down slightly from 878,652 ounces in the same period last year. Gold sales reached 842,965 ounces, down from 879,063 ounces last year.
Gold output in the first quarter of 2025 decreased slightly due to lower output at the Canadian Malartic mine, compensated by higher output in LaRonde and Macassa. The Canadian Malartic mine was still operating better than planned, however, gold output decreased compared to the same period due to lower gold content in the Barnat area.
The average price of gold that Agnico earned was 2,891 USD/ounce, up sharply compared to 2,062 USD/ounce in the first quarter of 2024.
Production costs continue to be well controlled, with an average production cost of $879/ounce, a cash cost of $903/ounce and an all-income maintenance cost (AISC) of $1,183/ounce.
AISC - the total maintenance cost (refying the total actual cost of producing an ounce of gold) decreased in the first quarter of 2025 compared to the same period last year thanks to lower maintenance costs, mainly due to reduced development costs postponed at Detour Lake mine, partly offset by increased administrative management costs - the company said.
Agnico Eagle is expected to produce about 3.3 to 3.5 million ounces of gold in 2025, while maintaining the estimated mining cost of $915 to $965 per ounce of gold and the total all- outstanding cost (AISC) of $1,250 to $1,300/ounce.
Thanks to strong cash flow, the company decided to divide a dividend of 0.4 USD for each stock in this quarter and increase the stock buyback plan to 1 billion USD. In the first quarter alone, the company bought back 488,047 shares at an average price of 102.44 USD/share, a total of about 50 million USD.
