Agnico Eagle Mines Limited

Good day, my name is Michelle and I will be your conference operator today. At this time, I would like to welcome everyone to the Ednigo Eagle Minds Limited First Quarter Results 2023 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, please press star 2. Thank you. Mr. Ammar El-Jondi, you may begin your conference.

Thank you and good morning, everyone. On this beautiful spring, late April day, it's a pleasure to have the opportunity to talk about our first quarter results. But before I do that, I'm in a room with a lot of my colleagues who will be dealing a lot with this discussion. But in particular, I'd like to talk briefly about two colleagues. On my right, Sean Boyd, who mentioned to me that at this AGM at 11 o'clock will be his 40th AGM with the company. You don't have many people in any business that committed for that long who've created as much value as Sean has. So that's quite the milestone, Sean, and we'll make sure we point it out again on the 50th. And on my left, Dave Smith, CFO extraordinaire and a good personal friend who today is his last official day as CFO. He has agreed to work with Jamie Porter over the next month or two to transition and then move, I think, happily into retirement. Good for you, Dave. But I just wanted to point that out. So we're going to be summarizing the first quarter results. Really, though, this story is three parts. One, strong operational performance, strong production, good costs, good safety, good environmental performance. Two, very good progress on optimizing our assets. 2022 was a year of consolidation. 2023 is going to be a year of optimization. There's a lot of work, particular focus on the Abitibi Belt, but huge potential. And then three, excellent exploration results. Importantly, excellent across a number of assets, and Guy will talk about that. But I want to start with safety. Our greatest responsibility at Agnico, and I would say at any company, is for the safety of our people and the safety of our communities. In the third quarter last year, I had the pleasure to announce that it was the safest quarter in the company's 65-year history. The last call, the year-end call in February, I then had the pleasure to announce the safest year in the company's 65-year history. And now in the first quarter of 2023, I can once again I have, once again, the pleasure of saying another record safety quarter in the company's 65-year history. That's pretty fantastic. So before we get started on the details, I would like to mention the forward-looking statements. There's a couple of pages there. It's important. A lot of what we talk about is going to be looking forward in our best estimates, but clearly they're estimates. I am going to go through this is how the call will go today we'll try to keep the converse the the presentation to a half hour then open it up to questions I will quickly go over the highlights on the operations but really I want to focus us on the excellent things we're doing uh to create value long term and I'm going to be asking the people in charge of that to talk directly one growth at Detour, and Natasha will be talking about that. Two, growth at Mallardic, and Dominic will be talking about that. And again, Detour and Mallardic, some of the biggest gold mines in the world, some of the longest life gold mines in the world in the best jurisdictions with a lot of growth. Three, the consolidation work we're doing on the Abitibi Belt, there is a lot of work there. It's still very early. but we're making good progress, and Jean Robitaille will talk about that. And then four, as I mentioned, exploration, and Guy will talk about that. So jumping into the presentation, just hitting the highlights, strong quarterly production and cost, record safety performance, production at 813,000 ounces, cash costs at $832, and all-in sustaining costs of $1,125. Particular... A shout out to the operating team. We've talked about inflation. We've talked about cost pressures. But as we've said before, what really drives costs are efficient operations. And the team delivered that. Solid financial results with record quarterly cash flow. Adjusted net income of 58 cents. Operating cash flow of $1.30 a share. There is a big accounting adjustment. I will let Dave talk about that later. in the presentation, gold production, capital, and cost guidance maintained for the year. Next page, please. We've had continued exploration success. That's impressive, but more impressive it's been across the board, at Meliodine, at Kitala, at La Ronde, at Goldex, and, of course, continued success at Detour and Mallardic. We closed the Humana transaction on March 30th. We closed the joint venture with Tech on April 6th. Both of those deals, key strategic deals that position us well in some of the best mining jurisdictions in the world. We released our 22 sustainability report. And a shout out to our ESG team who won the investor relations award. award for best ESG reporting in the industry. So congratulations on that. Improvement across a number of indicators, safety, water, indigenous employment, things that are important to our business, and a quarterly dividend of 40 cents a share. Now, before I flip, I do want to give a special congratulations to the team in Finland on the ESG side. The Kitala mine is transitioning to 100% clean nuclear power, starting effectively now. That reduces our greenhouse gas emissions for the entire operation by about a third. And so our target across the company is a 30% reduction by 2030. Kitala has effectively done that now. And it's also an opportunity to point out Again, that getting to the targets we need to get to are not just company-specific initiatives. They're not just industry-specific initiatives, but they have to include broader industry and governments, and this is a perfect example of how much progress you can make when you have access to clean electricity, which, by the way, to repeat, virtually all of our electricity on Ontario and Quebec is clean as well. Looking at just some highlights of the sustainability report, again, 65 years, the best safety performance. I can't say that enough. I want to take a second to talk about the Dr. Leanne Baker Scholarship. I think a lot of you remember Leanne Baker, an exceptional individual. She was on our board for a long time, really an inspiration to young women as a very successful person. on the financial world, on the technical world. And in that scholarship, we have 14 young ladies at Agnico with strong technical and financial backgrounds, very capable, and we are mentoring them as future leaders of the company. An increase in Indigenous employment, always important to reduction in freshwater usage. And I'm very proud of this. $1.5 billion in local procurement in 2022. That really does make a difference on the ground. Next slide, please. So the rest of this presentation primarily is going to be focused on the key value drivers that are going to move this company forward for years to come. I'm going to have the individuals talk about them. Again, Natasha will be talking about Detour Lake where we've had record throughput through the mill as Natasha and her excellent team continue to make progress there and she will also talk about our long-term objective to get to a million ounces a year. Dominic will talk about the Canadian Malartic complex, the shaft sinking, the ramp construction and some of the opportunities we see there and Jean will be talking about some of the initiatives to consolidate the Abitibi belt that we've talked about, including amalgamated Kirkland, Upper Beaver, and Wassamaq. So with that, I will pass it over to Natasha.

Thank you, Omar, and good morning, everyone. So as Omar said, I'll provide an update on Detour and our vision to get to a million ounces per year. I'm on slide nine, and I'll start with the mill expansion. So this has been a journey, as you can see from the top graph on this slide. The team has progressed quite a bit over the last few years in increasing throughput at the mill, and have had tremendous success in achieving their objectives. And in my opinion, anyway, since the merger, we've actually seen an acceleration of that because of the technical bench strength that came with the merger and the ability for us to leverage the best, the sharing of best practices between Canadian Malartic and Detour. There's a lot of lessons learned here. And so we continue to advance on multiple initiatives to increase and stabilize the mill throughput to 28 million tons a year by 2025, if not sooner. And as mentioned in February, the last major initiative in our plan to achieve 28 million tons a year was successfully completed towards the end of 2022 with the installation of the secondary crusher screens. And so this quarter, As well as going forward in the year, the focus at the mill will now shift to optimizing the mill processes, to analyzing the wear and tear from the higher throughput to optimize maintenance practices. And as I mentioned before, basically improving the overall mill runtime so that the higher throughput becomes simply more and more consistent over time. Basically what we're doing is tweaking the system now and aiming to improve the runtime. which is normal at this phase of the expansion process. And some examples of what I mean by tweaking the system is that we're looking at small changes to extend the liner life. We're tweaking the refeed system so that it operates more efficiently in the winter. We're relocating some of the pipelines in the mill just to maximize efficiency of pipe replacement during shutdowns. Those are just a few examples from a list of things that the team is working on very hard. And also while doing this, we're also evaluating a pathway to increase the mill throughput beyond 28 million tons a year. The second graph below on the slide shows that. It shows our current thinking of how we envision going beyond 28 million tons a year. And I'll just take a minute to explain that. First off, we feel that the infrastructure that we currently have in place has the potential to deliver more once we optimize our mill processes and our maintenance strategy. And with that logic, we think that there's opportunity to gain somewhere in the order of maybe half a million to a million tons per year just from that. The next is implementing an expert system like we have in some of our other mills. We think that there's opportunity to gain some tonnage there too. And finally, we're testing the ability of increasing the percentage of pre-crushed material to feed some more feed through the refeed system. And we're also testing the ore sorting capabilities. So this is just a vision of where we see the potential to achieve higher tonnage beyond 28 million tons a year. And importantly, these initiatives that I just talked about come with limited capital expenditures. It's still early, though, but we do have an experienced team on site working on this. Now, moving on to the second part of our vision to get to a million ounces at detour. and that's the evaluation of the potential of the underground mine. Now, the first portion of this study would be to complete an initial underground mineral resource associated with the mineralization that sits just outside of the final pit limits. To that end, we are carrying out an aggressive drilling program, and Guy will expand on this shortly. But we do have more drilling to do, and once that underground resource is ready, this will be used as a basis for the underground mining scenarios that we'll be working on. Finally, to end, I just wanted to say that the team at Detour has done an incredible job so far, and I just want to take the opportunity to thank them for their hard work, but also for their passion at continuing to look at ways of maximizing the value of such an incredible asset. But also to echo Amar's words, I just want to thank the rest of the sites for performing so well, as you did this quarter. It's just truly a testament to the caliber of the people that we have here at Ethnico. So thank you. And with that, I'll pass the call over to Dominic Girard.