What Agnico Eagle Mines (AEM) Said on Its Q3 Earnings Call

Key Points

• Q3 production reached 814,000 ounces, with free cash flow of $852 million and adjusted net income of approximately $1.3 billion. Agnico Eagle reaffirmed its 2026 outlook, expecting production at the lower end and costs at the upper end of guidance amid higher diesel prices and supply-chain pressures.
• The company held approximately $3.4 billion in net cash and returned $478 million to shareholders during the quarter, equal to 56% of free cash flow. Management now expects full-year shareholder returns to exceed 50% of free cash flow at current gold prices.
• Agnico Eagle is advancing major growth projects, targeting a 20%–30% production increase to more than 4 million ounces annually in the early to mid-2030s. Odyssey remains on track for first production through its shaft in Q2 2027, while Detour Lake, Hope Bay and Upper Beaver also progressed.

Agnico Eagle Mines NYSE: AEM reported third-quarter 2026 gold production of 814,000 ounces and free cash flow of $852 million, while reaffirming that it expects to meet the lower end of its annual production guidance and the upper end of its cost guidance.

President and CEO Ammar Al-Joundi said production landed at the midpoint of the company’s quarterly adjusted guidance. Cash costs were $1,133 per ounce, or 1% above the upper end of quarterly cost guidance, amid elevated diesel prices, supply-chain disruption, tariffs and geopolitical pressures.

“We remain on track to deliver our full year 2026 production and cost guidance, albeit at the lower end and the upper end of production and costs, respectively,” Al-Joundi said.

Financial results and capital returns

Chief Financial Officer Jamie Porter said the company generated adjusted net income of about $1.3 billion, or $2.62 per share, and adjusted EBITDA of roughly $2.5 billion in the third quarter. All-in sustaining costs were $1,648 per ounce.

Year-to-date production totaled about 2.5 million ounces. Porter said higher diesel prices added more than $30 per ounce to third-quarter cash costs versus the company’s budget. Diesel represents approximately 11% of Agnico Eagle’s operating costs, though Porter said the company has less exposure than many peers because of grid power availability in Ontario and Quebec and its predominantly underground mine portfolio.

The company held a net cash position of approximately $3.4 billion as of Sept. 30. It returned about $478 million to shareholders through dividends and share repurchases during the quarter, representing 56% of free cash flow. Year-to-date returns represented 51% of free cash flow, exceeding the company’s initial 40% target.

At current gold prices, Agnico Eagle now expects to return more than 50% of free cash flow to shareholders for the full year, subject to business needs. Porter said 50% was “a reasonable threshold” to consider for 2027, although the company has not established a formal target for the year.

The company has invested approximately $1.6 billion in development capital year to date across Detour Lake, Odyssey, Hope Bay and Upper Beaver. Porter said these projects are expected to generate returns of roughly 25% to 50% at current spot gold prices.

Growth projects advance

Management emphasized its plan to increase production by 20% to 30% over the next decade, reaching more than 4 million ounces annually beginning in the early to mid-2030s. The company expects Detour Underground, mill-filling at Malartic, Hope Bay and Upper Beaver collectively to contribute an additional 1.3 million to 1.5 million ounces a year by the mid-2030s.

At the Odyssey project in Quebec, Executive Vice President and COO Dom Girard said construction is more than 70% complete and remains on target for first production through the shaft in the second quarter of 2027. Shaft sinking was completed four months ahead of schedule, while work is now focused on installing a production hoist.

At Hope Bay in Nunavut, detailed engineering was 75% complete and overall construction had reached 13% at the end of September. Girard said the project’s new 37-megawatt power plant was progressing, with 25% of structural steel completed at the time of the call. He also highlighted the completion of a large sealift campaign that delivered supplies to the site.

At Detour Lake, Executive Vice President and COO Natasha Vaz said development of the exploration ramp is proceeding from two active headings. The bulk sample is expected to be completed in the first half of 2027, with the resulting data intended for incorporation into the Domain 54 mine plan. That area could support underground production as early as 2028.

Vaz said Agnico Eagle is evaluating broader opportunities at Detour, including increased milling capacity, a larger open pit and a larger underground operation. The company expects to provide a project outlook in 2027. Detour is targeted to become a 1-million-ounce-per-year producer in the early 2030s.

At Upper Beaver, the exploration ramp advanced more than 600 meters during the quarter and reached a depth of 210 meters. Shaft sinking reached just over 730 meters, with the company expecting to reach the 760-meter level and begin shaft station excavation during the fourth quarter. Agnico Eagle is also evaluating a potential shaft extension to 1,200 meters to support infill drilling and possible resource growth at depth.

Operational and exploration updates

Girard said the Barnat Pit team safely restarted mining after a July rock movement, completing a recovery plan slightly ahead of schedule in late September. He also cited Kittilä’s highest monthly mill recovery in five years during September.

Vaz said Detour, Macassa and Fosterville exceeded their operating plans in the quarter. Detour benefited from productivity gains, mining in a higher-grade area and localized positive grade reconciliation, though the mine has transitioned to a lower-grade sequence expected to continue through the fourth quarter. Macassa and Fosterville also benefited from higher-grade mining areas, mill optimization and improved productivity.

Executive Vice President of Exploration Guy Gosselin said the company completed more than 330 kilometers of diamond drilling in the quarter, bringing year-to-date drilling to 1.1 million meters toward a 1.4 million-meter annual budget. He said the company expects to replace and grow global mineral reserves and resources at year-end.

Gosselin highlighted exploration results at Odyssey, Detour Lake, Hope Bay and the recently acquired Ikkari project in Finland. At Detour, drilling returned 19 grams per tonne over 26 meters near the existing reserve pit limit, while Hope Bay drilling included results at the Madrid and Boston deposits. At Ikkari’s Helmi area, an intercept returned an uncapped average of 15 grams per tonne over 10 meters, including a one-meter sample grading 185 grams per tonne.

Management said it plans to provide further detail on project development and growth opportunities at its Capital Markets Day on Nov. 18.

About Agnico Eagle Mines (NYSE:AEM)

Agnico Eagle Mines Limited NYSE: AEM is a Canadian gold mining company engaged in the exploration, development and production of gold, as well as related activities such as mineral processing and mine-site reclamation. The company’s principal product is gold, with silver and other byproducts also recovered from certain operations.

Founded in 1957 through the merger of Agnico Mines and Eagle Mines, Agnico Eagle has grown into one of the world’s largest gold producers. Its operating portfolio is concentrated in established mining regions, including the Canadian provinces of Ontario and Quebec, Nunavut in northern Canada, and Finland.

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