Agnico Eagle Mines (AEM) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

April 26, 2022 11:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning. My name is Dennis, and I will be your conference operator today. At this time, I would like to welcome everyone to the Agnico Eagle First Quarter Results 2022 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions]

Mr. Ammar Al-Joundi, you may begin your conference.

Ammar Al-Joundi

Thank you, and good morning, everyone.

Well, it’s been 65 days since we last spoke, and we’ve been very busy. We’ve been working hard, and I think what we’ll demonstrate today is some very good progress. There’s a lot to cover this morning. We’re excited about where we are. We’re excited about where we’re going.

And for all of you who know us, at Agnico, we can go on and on talking about the Company. So, we’ll try to be quick and leave some time for questions. Before I jump in, really, there are four things to take away from this call.

One, on the operations side, we had a good quarter, a good start to the year. We are reiterating our production guidance. We are importantly, in this inflationary environment, reiterating our cost guidance. And I would say, while the -- as we go through the numbers, the numbers are strong, but I would say particularly pleased, given the challenges on the production side. And again, we’ll get into it, a little bit ahead of our internal budget in the first quarter, which is quite exceptional, given the initial challenges with Omicron and the situation in January. And on the cost side, we’re a little below our internal budget on costs, which again is exceptional, given the inflationary environment. Again, reaffirming our combined company full year production guidance of 3.2 million to 3.4 million ounces and our combined company full year cash costs of $725 to $775.

The second item to take away is the integration of the merged entity. We would say, it’s gone exceptionally well. The senior management team is well in place. Everyone knows what they’re doing. We took the opportunity to quickly, as promised, streamline the organization. And as you see from our results in our press release that streamlining has resulted in roughly double the synergy savings that we had estimated. We had estimated approximately $15 million a year in streamlined organizational costs, and we’re already closer to $30 million on that.