July 29, 2009 / 8:39 PM / 8 years ago

UPDATE 2-Agnico-Eagle profit drops on non-cash charges

* Q2 EPS drops to 1 cent from 6 cents

* Gold production up 76 percent on new mines

* Takes non-cash charges, but beats expectations

(Adds details, in U.S. dollars, unless noted)

TORONTO, July 29 (Reuters) - Canada’s Agnico-Eagle Mines (AEM.TO) said on Wednesday its second-quarter profit fell 86 percent as non-cash currency translation and stock option expense losses offset higher gold production.

The gold miner earned $1.2 million, or 1 cent a share, in the quarter ended June 30. That was down from $8.3 million, or 6 cents, a year earlier.

Stripping out the $16.7 million currency charge and $5 million stock option hit, Agnico earned 16 cents a share.

That beat analysts’ expectations of 12 cents a share, as polled by Reuters.

Gold production jumped 76 percent, helped by output from the Goldex mine in Quebec, which opened last year, and initial production from the Kittila mine in Finland and Lapa mine in Quebec, which both reached commercial production in May.

Realized gold prices climbed to $962 an ounce from $804 an ounce in the year-before period.

Cash costs per ounce rose to $326 from $113 as copper and zinc prices fell year-on-year. Agnico uses base metal and silver production as a cost offset for its gold mining.

Agnico, whose flagship mine is La Ronde in Quebec, maintained its 2009 production guidance of between 550,000 ounces and 575,000 ounces.

Its two mines in development, Pinos Altos in Mexico and Meadowbank in Nunavut, remain on schedule, it said. Pinos Altos produced its first gold in July, while Meadowbank should see initial production in the first quarter of 2010.

Agnico has said output should rise to 1.2 million ounces next year when Meadowbank opens, and to around 1.6 million ounces by the middle of the next decade through expansion of four of its six current properties.

As part of that expansion, the company said on Wednesday it has approved expansion projects at Goldex and Pinos Altos.

Agnico’s shares closed at C$56.85 on the Toronto Stock Exchange. The results were released after markets closed. ($1=$1.09 Canadian) (Reporting by Cameron French; editing by Janet Guttsman)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below