AGNICO EAGLE MINES LTD Q4 2025 earnings call

Thank you, operator. Good morning, everyone, and thank you for joining our Agnico Eagle fourth quarter and year-end 2025 conference call. I'd like to remind everyone that we'll be making a number of forward-looking statements, so please keep that in mind and refer to the disclaimers at the beginning of this presentation. This morning, we're pleased to annoz another strong quarter, capping off a remarkable year. In 2025, as gold prices hit new highs throughout the year, Agnico Eagle delivered on our production targets, we delivered on our costs, and we did it responsibly and reliably. While the price of gold went up $1,700 year-over-year, our cash costs went up $76 per ounce.

This means we delivered over 95% of this gold price increase to the benefit of our shareholders, delivering on our core mandate of providing gold upside leverage to our owners. In 2025, we repaid almost $1 billion in debt, we built up almost $3 billion in cash, and we returned over $1.4 billion directly to our owners through dividends and share buybacks, all while continuing to invest heavily in our future through the largest exploration budget we've ever had and through continued strong investment into our five key growth projects. In an exceptional year for gold, Agnico Eagle delivered on our commitments to our owners, to our employees, and to our communities.

This strong momentum continues into 2026 and beyond, supported by a stable annual production profile of between 3.3-3.5 million oz over the next three years at peer-leading costs, while reporting record reserves, record resources, record inferred oz, and an increase to our dividend. While 2026 cash costs are forecast to be up a little over $100 per ounce compared to last year, more than half of that increase is from the assumption of higher royalties and a stronger Canadian dollar. Excluding those assumptions, our cost increase is about 4%-5%. This would be at or slightly below the inflation we saw in the industry last year. So good cost control on the factors that we can influence. Our reserves are at a record 55.4 million oz, up 2%.

Our resources are at a record 47.1 million oz, up almost 10%, and our inferred oz are at a record 41.8 million oz, up a remarkable 15.5%. 2025 was an exceptional year, and our near-term prospects look even better. But the real story this morning, the real excitement, is not in looking back or even the next three years. The real excitement this morning is that Agnico Eagle is in the best position we've ever been in, and we're already aggressively advancing our next phase of growth and growth per share. This morning, we want to focus on our plan to increase production by up to 20%-30% over the next decade, with a path to over 4 million oz of annual production by the early 2030s.

This growth is from the highest quality projects in the best jurisdictions in the world. This growth is from projects we already own, in jurisdictions we know well with existing teams and in most cases, leveraging off existing infrastructure. This is important because our job isn't simply to grow, but rather it's to grow value for our owners on a per share basis. In our industry, growing in stable jurisdictions, leveraging existing infrastructure not only delivers to our owners the best return on capital, but also the best risk-adjusted return on capital. Next slide, please. These assets, where over the past few years we've been investing substantial time, energy, and money, and where our investments are accelerating. We're at a point where we see a step change in production per share starting in 2030, and we're eager to share our progress with you this morning.

At Detour Lake, the largest gold mine in Canada, where we're executing a plan with the potential to deliver an additional 300-350,000 oz per year through the development of an underground mine, we've added 4.3 million oz of resources during the past year in the high-grade mineralized corridor that's amenable to this underground mining. And we're tripling our investment from $100 million-$300 million as we accelerate our work towards a go-ahead decision mid-2027, and potential to start underground production as early as 2028. At the Canadian Malartic Complex, the second-largest gold mine in Canada, where we see an opportunity to add a remarkable 400-500,000 oz per year through our fill-the-mill strategy. We've added 9 million oz of reserves since our last technical update.

We're ahead of schedule on the ramp, expected first production from East Gouldie this quarter, and ahead of schedule on the first shaft, expected to commission in 2027. We're making excellent progress evaluating opportunities to fill the mill further via the Marban open pit, via Wasamac underground, and via a second shaft. All three with targeted first production by 2033. At Upper Beaver, which is expected to produce over 200,000 oz per year, we're ahead of schedule again on both the ramp and the shaft. We're increasing our investment from $200 million-$300 million to accelerate the development of the project, with the goal of bringing production forward to 2030.

At Hope Bay, where we're working on a study that supports a 400- to 425,000-oz per year operation, we saw a 46% increase in inferred mineral resources, primarily from Patch Seven. We expect a study update and potentially a project approval as soon as May of this year. We continue to make good progress at San Nicolás and hope to have permits to move forward shortly. These projects alone have the potential to add 1.3-1.5 million oz of highly profitable annual production, and in each case, we've made excellent progress, and we're moving forward aggressively. With that introduction, I will now turn over the presentation to our CFO, Jamie Porter, to review our third quarter and full year results.

Thank you, Ammar. As Ammar mentioned, we delivered record financial results in 2025, driven by a strong operating performance, disciplined cost control, and a supportive gold price environment. We finished the year with a solid fourth quarter, producing approximately 841,000 oz of gold at total cash costs of $1,089, and all-in sustaining costs of $1,517 per ounce. Costs increased quarter-over-quarter, primarily due to higher royalties, lower production volumes, and higher costs at our Meadowbank mine associated with extending mine life. Despite higher costs, we delivered a number of financial records in the fourth quarter, including record adjusted earnings of approximately $1.4 billion, or $2.70 per share, and record free cash flow of over $1.3 billion, or $2.62 per share.

For the full 2025 year, we exceeded the midpoint of our guidance, with gold production of 3.45 million oz, underscoring our consistent track record of execution. Total cash costs and all-in sustaining costs were $979 and $1,339 per ounce, respectively. Both were slightly above the top end of our guidance ranges due to higher royalty costs, driven by an average realized gold price of $3,454, nearly $1,000 per ounce above our guidance assumption. We exclude the impact of higher royalties. Our total cash costs would have been $937 per ounce, $42 per ounce lower and below the midpoint of our guidance, again, reflecting strong cost discipline and execution by our operating teams.

With this performance, we generated strong leverage to the gold price, capturing approximately 95% of the increase in gold price and margin expansion, and delivered record financial results across the board, including approximately $4.4 billion in free cash flow for the year. We turn to the next slide. Our record financial performance and continued margin expansion benefited our shareholders, both through increased direct returns and through a materially stronger balance sheet. In 2025, we repaid approximately $950 million of debt and increased our cash position by $1.9 billion, ending the year with $2.9 billion of cash. We delivered record shareholder returns through share buybacks and dividends, totaling approximately $500 million in the fourth quarter and a record $1.4 billion for the full 2025 year.

We are in the strongest financial position in our company's history, and we believe we are exceptionally well-positioned in the current gold price environment. We expect to continue to increase shareholder returns. We increased the quarterly dividend by 12.5% to $0.45 per share, and at current gold prices, we expect to be more active on share buybacks. To support this, we intend to renew our normal course issuer bid in May and increase the purchase limit up to $2 billion. In 2025, we returned approximately one-third of our free cash flow to shareholders, and we see the potential to increase that to 40% or higher this year, with flexibility depending on the gold price and the needs of the business. At the same time, we remain focused on further strengthening our financial position.

As a reminder, given our strong profitability, we are required to pay a significantly higher cash tax liability related to the 2025 fiscal year, this February, which is approximately $1.3 billion, and we have the cash on hand to fund that obligation. Lastly, and importantly, we continue to deploy capital in a disciplined manner to advance our highest return organic growth opportunities. While current gold prices are driving strong cash flow generation, we remain committed to disciplined capital allocation with a continued focus on enhancing long-term shareholder value. We move on to the next slide. We've updated our guidance and continued to expect stable production levels over the next three years.

We're especially proud of the work our team has done as we were able to provide an improved outlook for 2028 relative to consensus, supported by a life of mine extension at Meadowbank and higher levels of production from Canadian Malartic, Fosterville, and Kitikmeot. We turn to cost. The midpoint of our 2026 guidance ranges are $1,070 per ounce for cash costs and $1,475 per ounce for all-in sustaining costs. Approximately 60% of the increase in cash costs relative to 2025 reflects higher royalties, driven by a higher budgeted gold price of $4,500 per ounce and the impact of a stronger Canadian dollar. The remaining 40% of the increase reflects expected inflation of approximately 4%-5%, and the impact of lower grade mining sequences.

Beginning in 2026, to enhance consistency and comparability across our Nunavut operations, we have adjusted the calculation of total cash costs and all-in sustaining costs to exclude certain payments at Amaruq that are made to the NTI, an organization representing the Inuit of Nunavut. These payments have similar characteristics to mining duties we pay under the Nunavut Mining Regulations, which are already excluded from the calculation of total cash costs and all-in sustaining costs. Our cash costs and all-in sustaining costs remain hundreds of dollars per ounce below those of our peers, reflecting the quality of our asset base and continued cost discipline. We look at our capital expenditure guidance. It reflects our focus on reinvesting in the business to lay the groundwork for our next phase of growth. We are accelerating capital at Detour Underground and Upper Beaver through mid-2027.

In addition, Hope Bay represents an attractive growth opportunity. If approved, we expect additional capital of approximately $300 million beyond what is currently reflected in the guidance for 2026. Dom, Natasha, and Guy will provide further detail on these projects later on the call. Together, these projects represent compelling opportunities that deliver strong returns with significant upside and the potential to create value for decades to come. Overall, our updated guidance reflects a consistent and reliable business at peer-leading costs as we continue to advance our pipeline of growth projects and remain well-positioned to deliver meaningful leverage to higher gold prices. With that, I'll turn the call over to Dom.

Thank you, Jamie. Good morning, everyone. In my part, I will cover the operation and key project highlights for Quebec, Nunavut, and Finland. Q4 have been very stable, again, consistent quarter that contributed to a strong 2025 on production and cost. Thanks to all employees and management team for their commitment, engagement, but specifically about the collaboration to keep improving the business. And a good example of that collaboration is about how we are or around how we are better usage, we do a better usage of our data. It is highlighted here in the Outlook. At LaRonde, the last six months, they've worked on telemetry to analyze the data, the behavior of the equipment, and the behavior of the operator to better understand how this was going.

They've been able to improve the number of hours on the transmissions and motors from 3,000 hours up to now 6,000-8,000 hours. This have been done by building an in-house expertise on analyzing data and finding trending, and then getting back to the operator, getting back to the trainers to go in that direction. So this is a very good way to be more efficient, and this is also something which is transferable to other operations and other project that we're currently building. So through that collaboration, now we're transferring that to Goldex, and then it's gonna go also to other divisions. Same thing with the fleet management system. We're piloting right now at LZ5, so specifically, we're gonna have a dispatch system into our ramps.

For you that have already been underground into a ramp, you could see how it could be a mess sometime. So we're now bringing that to another level, and all that knowledge is gonna be rolled out also at Odyssey and Amaruq later this year. Another good news on the outlook is Meadowbank mine life extending up to 2030. Meadowbank have played a very important role in smoothing our 2026-2030 production profile by bringing those additional oz. Thanks to the Meadowbank team for this key contribution. Those oz are, yes, higher risk, but no higher risk. I mean, higher costs, but low risk into, let's say, currently, current infrastructure. So that's very positive, and thanks for the team also to keep looking for more options to potentially extend it beyond 2030. This is still under review. Next page.

Canadian Malartic fill-the-mill strategy. So back in 2023, when we released our first or updated study on that, we had 9 million oz. The mine life was going to 2042. With the good drilling done, we've been able to potentially extend by double that mine life. So with the first shaft, which is illustrated on the first line here at the bottom, within the ramp, we're still very in good position to deliver that, on time, on budget. But since we are adding more oz, that could bring us up to 2056, to 2057. So this is why the second line is now into play. How could we bring those oz faster into the time? So the team is working on that, to potentially have a second shaft in operation in 2033.

That's one part of the vision of the 1 million oz. Again, back to 2023, we, at the time, set a vision, okay, how could we bring that to 1 million oz using just one-third of the mill? The first second shaft is a good example, and as well, in the last 3 years, we've worked to bring also Marban and Wesamac, two satellite ore bodies that's gonna be transported to Malartic, and that also could bring more oz. If you add, you do the sum of that, we're at the 1 million oz. We are progressing well into the studies, and we're targeting to give you more information on that, potentially end of Q3, early Q4 next year, that you're gonna be able to have a better view on all of them. So very positive news.

The fill-the-mill strategy is taking place, and we're, there's still room also at the mill. If you sum all of that, you're gonna be at 46,000 oz per year. So there's still over 25 drills running into the region around Canadian Malartic, and who knows where we're gonna be in three years from now? Next slide. At Hope Bay, back in 2021, after the acquisition of TMAC, we quickly set a target to bring it over, let's say, north of 350,000 oz per year to make that project economical. So the good news is we're reaching that now, and we are looking to release and to give you more information about that, in May this year.

The study looks like 6,000 tons per day, north of 400,000 oz per year, so we're reaching our target. We're gonna be able to start to, let's say, a first kickoff, a 10-10-10-year life of mine. This is what we're looking for. And if this goes forward, we're gonna be able to spend, we're well prepared to spend an additional $300 million on top of what we're guiding right now. So it's very positive, and the study is built on strong foundation using Meliadine and Amaruq Mine benchmark. So we know what's gonna be the cost, we know how we're gonna operate that. It is, it is backed with historical background, historical information on the OpEx, on the CapEx, how it's gonna cost to build. Secondly, we are over—we're gonna be over 50% of engineering.

That was a clear target, we're reaching that. On the execution, it's not our first barbecue in Nunavut, so we know how to do it. It's gonna be the same team using the same contractors or partially same contractors, and we know it's gonna be a success. On that, I will pass the mic to my great teammate, Natasha.

Thanks, Dom, and good morning, everyone. I'll cover the operational highlights for Ontario, Australia and Mexico. The regions delivered full year production as planned and demonstrated balanced execution across the portfolio. And at the same time, they continued to advance initiatives to further optimize our performance. At Macassa, we're very proud of the team as we've achieved record gold production. And in 2025, anticipating declining reserve grades in the coming years, the team proactively initiated work to increase mill throughput. And now in 2026, we continue to advance these initiatives with a target to increase throughput to 2,150 tons per day by the end of 2027. At Fosterville, we're taking a very similar approach to managing declining reserve grade.

We now have a plan to increase the milling and mining rates to 3,300 tons per day by 2028 through various optimization efforts. This plan is expected to support annual production of somewhere around 160,000-190,000 oz, starting in 2028 and into the early 2030s. We continue to see significant upside at Fosterville through exploration to support mine life extension. At Detour, despite the pit delays this year, the mill achieved a record annual throughput of 28 million tons. That represents a 35% increase since the mill expansion began 6 years ago. I just want to take a moment to commend the site team for this achievement. It was a lot of hard work to get there, so just wanted to say a quick thank you to the team.

The team is now focused on further optimization with a revised timeline to support a more measured ramp-up to 29 million tons, giving the team a little bit more flexibility and to optimize processes and, and embed sustainable operating practices. Now, moving to the next slide, the mill optimization that I just spoke about to 29 million tons is part of Detour's next phase of growth, which also includes the development of an underground operation. We're advancing on both fronts, and we have a clear line of sight to achieving 1 million oz of annual gold production in the early 2030. In 2025, we made good progress in advancing permitting, in exploration, in high-intensity drilling, in establishing the key infrastructure on surface, and of course, developing the exploration ramp.

So given our increasing confidence in the underground project, we've decided to accelerate approximately $200 million of capital through to mid-2027. This acceleration of capital is expected to de-risk project construction and ramp up and also could accelerate the development towards the main ore zone. At the same time, we're also assessing to begin incremental underground production from a shallower western extension zone as early as 2028. So since our last project update in June 2024, the mineral resources have increased significantly.

As a reminder, only 4 million oz were included in the underground study update in June 2024, while our year-end mineral resources are now roughly at 6 million oz in measured and indicated, and another 6 million oz in inferred. And considering the continued exploration success, we feel that there's an opportunity for a larger underground mine than the one we first envisioned.

The combination of exploration success and this higher gold price environment has given us a lot of optionality at Detour that we're in the early stages of evaluating. This could include a higher milling capacity, a larger underground scenario, or a larger open pit. You know, we said, when the study was completed in 2024, that this was just a snapshot in time, and we continue to believe that. So stay tuned. We feel that further opportunity is still ahead at Detour. Now, moving to Upper Beaver. The project continues to advance very well there. The exploration ramp is ahead of schedule, and in the fourth quarter, we began shaft sinking, and by year-end, the shaft reached a depth of 155 m.

The team has done an excellent job, and given their strong execution, we're now planning to spend an additional $100 million from now until project sanction. That's expected in mid-2027. Again, like the Detour Underground Project, this acceleration of capital is expected to de-risk the construction and ramp up and also accelerate initial production to 2030. Now, I've said this before, but the Upper Beaver project could unlock significant long-term value across the company's wider Kirkland Lake camp. In addition to the potential extension of the mineralization at depth at Upper Beaver, the project could also support a centralized mill strategy for satellite deposits that are nearby, like Upper Canada or Anoki-McBean. All in all, the Upper Beaver project is progressing very well. I would like to end by just thanking the teams for their passion, their persistence, their incredible efforts in 2025.

It's very much appreciated, and I look forward to continuing to advance the optimization efforts with you and the key projects. With that, I'll pass the call over to Guy.

Thank you, Natasha, and good morning, everyone. First of all, I would like to take a moment to thank all of the exploration team at the different mine sites and regional exploration offices across the company for an excellent year for safety, productivity, and cost control. We had more than 120 drill rigs in action through the year in 2025 and safely completed nearly 1.4 million m of core drilling while controlling our unit costs that were slightly lower than previous year. Our commitment to innovation, led by our drilling excellence team, continued to pay off and will be an important part of our success moving forward as we are undertaking 2026 with an objective to exceed 1.5 million m of drilling.

On slide 14, the 2025 exploration drill program across our operation and key pipeline project, combined with the acquisition of Marban project next to the Canadian Malartic Complex, led to a very strong mineral reserve and mineral resources total at year-end 2025. Year-over-year, our mineral reserve are up 2.1% to 55.4 million oz. Our measured and indicated mineral resources are up by almost 10% to 47 million oz, and our inferred mineral resources are up by an impressive 15.5% to 42 million oz, demonstrating the strong exploration upside of our assets.

As we can see on the graph on the right-hand side of that slide, if we look globally, since the merger in early 2022, despite the fact that we've mined approximately 15 million oz over that period of time, we'll still manage to significantly grow our mineral reserves, net of mining depletion, to a record of 55.4 million oz through successful exploration, conversion, delivery of studies, and smart acquisition over the last four years. From a result standpoint, I would like to comment on three projects.

On slide 15, in Canadian Malartic, the great results produced throughout the year at East Gouldie, Odyssey and the Parallel Eclipse Zone led to an addition year-over-year of about 470,000 oz in underground proven and probable reserves, and of 2.9 million oz in inferred mineral resources, including 600,000 oz from the newly discovered Eclipse Zone, parallel to the East Gouldie, close to our plant mining infrastructure. On the adjacent Marban project, 128 drills were completed, totaling in excess of 39 km of drilling in 2025. An initial mineral reserve declaration of 1.58 million oz was made from 52 million tons at 0.95 g/t as part of our fill-the-mill strategy.

The initial mineral reserve was calculated from the existing drill hole database at the time of the acquisition and did not incorporate any of the 2025 drilling. We plan to deliver an updated study of the Marban project at the end of 2026, incorporating new drilling as well as additional opportunities for synergy with the Canadian Malartic Complex, relating to workforce, equipment, and facilities in order to optimize Marban as part of our fill-the-mill strategy. Now on slide 16, at Detour, drilling has continued extremely well in the year, with 215 km of drilling completed, mostly focused on the infilling and expansion of the mineral resources towards the west to advance the underground project. Two areas were specifically targeted. One below and around the center point of the current reserve open pit, illustrated here in orange on this graphic.

The result in this area continued to support the two mining approach, with several wide interval, with combined width exceeding 200 m locally between 1 and 2 g/t, including narrower, high-grade intercept, reaching up to 10 g over 10 m. That could be mined sooner from underground, while keeping the option to mine the much wider, lower-grade surrounding mineralized envelope in a future larger open-pit scenario. The other area being targeted is located 3 km to the west and outside to the west of the current ultimate open pit scenario, close to the underground exploration ramp currently being developed. This area also returned strong results up to 10 grams over 10 m and remains open at depth into the west.

At year-end 2025, the resources amenable for underground mine project now stands at 5.5 million oz in measured and indicated, and 5.8 million oz in inferred. This will provide a much larger mineral resources base for the upcoming update of the Detour Underground Project, compared to the 2024 initial study that incorporated only 4.6 million oz in the first iteration of the mine plan. And last but not least, at Hope Bay, we had six drill rigs operating through the year, completing an excellent total of 131,000 m of drilling in 2025. We continue to see strong results in the Patch 7 area, both at depth and in the southern extension.

The excellent result, the result provided through the year led to the addition of 1 million oz year-over-year in inferred resources, mostly from the Patch Seven area. With a strong addition of mineral resources since the acquisition of the project in 2021, we have a much larger resources base to support the project development, redevelopment plan that was discussed earlier by Dominic. In 2026, exploration will continue to focus on growing and converting resources to reserves, to support the project development and deliver an updated reserve estimate at the end of 2026. So all in all, an excellent year in exploration that translated to a significant addition of reserves to support our short- to medium-term production growth vision. But even more importantly, a very significant increase of 15% in our inferred resources that makes us confident in a bright future.

These results keeps demonstrating the phenomenal exploration upside of our portfolio of project and the outstanding work being done by our great exploration, technical services, and operation team across our different, different operation and key value driver project. On that, I will return the microphone to Ammar for some closing remarks.

Thank you, Guy. At Agnico Eagle, we are proud of our record of growing value per share for our owners over decades, not only by providing full leverage to gold prices, but also, importantly, by growing gold production per share. As we look forward, we're excited that even as the second-largest producer of gold in the world, we see a clear path to a decade of continued and meaningful increases in production per share at peer-leading costs with exceptional risk-adjusted returns. And we're already working on additional projects that have the potential to add even more growth, including early work on Hammond Reef, Timmins East, and Northern Territory. Next slide, please. As you can see, we continue to work hard for all of our stakeholders, and we will continue to build off the same foundational strategic pillars that have served us well over the past 68 years.

We're going to continue to focus on the best mining jurisdictions based on geologic potential and political stability. We'll continue to be disciplined with our owners' money, making investment decisions based on technical and regional knowledge, creating value through the drill bit and through smart acquisitions, where and when it makes sense. We are uniquely well-positioned with a quality project pipeline, leveraging existing assets in the best regions in the world and where we believe we have a strong competitive advantage. We will continue to be focused on creating value on a per-share basis and on being leaders in our industry in returning capital to shareholders, as evidenced by over 42 years of consecutive and growing dividend payments and increasing share buybacks. In summary, 2025 was a great year for the gold market. 2026 is off to an even stronger, albeit volatile, start.

While we don't have a crystal ball to predict prices next week or next month, we do remain constructive and positive on the long-term gold price going forward due to global structural, financial, and political currents that are not easily changed. Our goal is not only to give our owners full upside leverage to gold prices, but to give them more gold per share over time. We've done that for decades, and we have a solid plan in place to continue to do that over the next decade, all while having the highest quality assets in the best jurisdictions in the world at peer-leading costs. At Agnico Eagle, our business is going well, and we're in the strongest position in our almost 70-year history. Thank you again for joining us on this call. Operator, may I ask that we now open up the call for questions?