Although easing, inflationary pressures to persist in coming months – Agnico
Canadian gold miner Agnico Eagle has started to see a gradual easing of inflationary headwinds and some relief in supply chain procurement, but the company has warned that these pressures could still be challenging in the fourth quarter and into 2023.
Due to cost inflation, Agnico warned on Wednesday that its total cash cost and all-in sustaining costs (AISC) were expected to be near the top end of the guided ranges of between $725/oz and $775/oz and $1 000/oz and $1 050/oz, respectively.
Capital expenditure for the year remains at the guided $1.4-billion and the expected gold production guidance has also been reiterated at between 3.2-million and 3.4-million ounces.
Agnico said the inflation on production costs in the third quarter was driven by higher input prices in key consumables, such as energy, cyanide and steel. Workforce availability and supply chain issues for equipment parts also remained challenging.
“Despite headwinds from a lower gold price and cost inflation, the company’s financial position remains strong. It gives us strategic flexibility and provides us with key development project and exploration programmes, while maintaining capital returns to our shareholders,” said president and CEO Ammar Al-Joundi.
In the third quarter, Agnico reported net income of $0.17 a share and adjusted net income of $0.52 a share.
The company’s gold production was 816 795 oz at a total cash cost of $779/oz and an AISC of $1 106/oz.
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