Agnico Eagle Earnings: Higher Gold Prices and Sales Volumes Offset by Higher Costs and Share Count

No-moat Agnico Eagle’s 2023 second quarter result was solid. EBITDA of USD 975 million was 6% higher than the previous corresponding period, or PCP, driven by higher gold sales volumes and a higher realized gold price, partially offset by increased unit cash costs. However, EBITDA per share of roughly USD 2 was similar to the second quarter of 2022 due to Agnico’s increased share count driven by its purchase of the remaining 50% of its Canadian Malartic mine from Yamana Gold in March 2023. This acquisition also drove higher depreciation and amortization, with adjusted net income falling 10% to roughly USD 320 million, or USD 0.65 per share. On balance, we think the roughly unchanged EBITDA per share compared with the PCP is a more accurate reflection of Agnico’s second-quarter performance.