Agnico Eagle Reports Second Quarter 2019 Results: Solid Operating Performance; Meliadine Production Ramping up Following Declaration of Commercial Production; Exploration
Stock Symbol: AEM (NYSE and TSX)
For further information: Investor Relations (416) 947-1212
(All amounts expressed in U.S. dollars unless otherwise noted)
AGNICO EAGLE REPORTS SECOND QUARTER 2019 RESULTS: SOLID OPERATING PERFORMANCE; MELIADINE PRODUCTION RAMPING UP FOLLOWING DECLARATION OF COMMERCIAL PRODUCTION; EXPLORATION CONTINUES TO ENHANCE MINESITE AND PIPELINE PROJECTS
Toronto (July 24, 2019) – Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico Eagle" or the "Company") today reported quarterly net income of $27.8 million, or $0.12 per share, for the second quarter of 2019. This result includes non-cash foreign currency translation gains on deferred tax liabilities of $5.9 million ($0.03 per share), derivative gains on financial instruments, mark-to-market and other adjustments of $3.3 million ($0.01 per share) and non-cash foreign currency translation losses of $4.1 million ($0.02 per share). Excluding these items would result in adjusted net income1 of $22.7 million or $0.10 per share for the second quarter of 2019. In the second quarter of 2018, the Company reported net income of $5.0 million or $0.02 per share.
Included in the second quarter of 2019 net income, and not adjusted above, is non-cash stock option expense of $3.3 million ($0.01 per share).
In the first six months of 2019, the Company reported net income of $64.8 million, or $0.28 per share. This compares with the first six months of 2018, when net income was $49.9 million, or $0.21 per share.
The increase in net income during the second quarter of 2019 compared to the prior year period was mainly due to lower amortization, lower income and mining taxes and higher realized gold prices, partially offset by lower gold sales volume (which does not include precommercial production ounces at Meliadine and Amaruq).
1 Adjusted net income is a non-GAAP measure. For a discussion regarding the Company's use of non-GAAP measures, please see "Note Regarding Certain Measures of Performance".
The increase in net income in the first six months of 2019 compared to the prior year period was mainly due to lower amortization and income and mining taxes, partially offset by lower gold sales volume (which does not include pre-commercial production ounces at Meliadine and Amaruq) and slightly lower realized gold prices.
In the second quarter of 2019, cash provided by operating activities was $126.3 million ($157.3 million before changes in non-cash components of working capital), as compared with the second quarter of 2018 when cash provided by operating activities was $120.1 million ($159.5 million before changes in non-cash components of working capital).
In the first six months of 2019, cash provided by operating activities was $275.0 million ($328.1 million before changes in non-cash components of working capital), as compared with the first six months of 2018 when cash provided by operating activities was $327.8 million ($340.1 million before changes in non-cash components of working capital).
The decrease in cash provided by operating activities, before changes in non-cash components of working capital, during the second quarter of 2019 compared to the prior year period was mainly due to lower gold sales volumes (which does not include pre-commercial production ounces at Meliadine and Amaruq), partially offset by higher realized gold prices and higher by-product revenue. Lower gold sales were mainly as a result of the expected lower gold production in the period due to reduced throughput levels at Meadowbank and mill maintenance shutdowns at LaRonde and Kittila.
The decrease in cash provided by operating activities, before changes in non-cash components of working capital, in the first six months of 2019 compared to the prior year period was mainly due to lower gold sales volumes (which does not include pre-commercial production ounces at Meliadine and Amaruq), lower by-product revenue and slightly lower realized gold prices, partially offset by lower costs. Lower gold sales were largely as a result of the expected lower gold production as described above.
"The second quarter of 2019 was another period of strong operating performance with production and costs tracking well with guidance. One of the key highlights in the quarter was the declaration of commercial production at our Meliadine mine in Nunavut", said Sean Boyd, Agnico Eagle's Chief Executive Officer. "With Meliadine ramping up to full production over the balance of the year and Amaruq on schedule to achieve commercial production in the third quarter of 2019, the Company is well positioned for a strong second half from both a financial and operational perspective", added Mr. Boyd.
Second quarter of 2019 highlights include:
- Solid operating results – Payable gold production2 in the second quarter of 2019 was 412,315 ounces (including pre-commercial production ounces of 29,699 ounces
2 Payable production of a mineral means the quantity of a mineral produced during a period contained in products that have been or will be sold by the Company whether such products are shipped during the period or held as inventory at the end of the period.
at Meliadine and 2,147 ounces at Amaruq) at production costs per ounce of $735, total cash costs per ounce3 of $652 and all-in sustaining costs per ounce4 of $953. Production costs, total cash costs per ounce and AISC per ounce exclude the precommercial production ounces relating to Meliadine and Amaruq
- Meliadine mine declared commercial production on May 14, 2019 – Total precommercial ounces of gold produced were 47,281 (including 17,582 ounces in the first quarter of 2019). Total capital costs for the development of Meliadine were approximately $830 million, which is below the original forecast of $900 million. Operations are continuing to ramp up and expected production for 2019 remains unchanged at approximately 230,000 ounces of gold (including pre-commercial production)
- Amaruq project remains on schedule for commercial production – Mining was impacted by slower than expected dewatering activities (related to adverse weather conditions) and a longer than expected caribou migration period. Despite this, the project continues to ramp up, with commercial production expected to be achieved late in the third quarter of 2019. At the end of the second quarter of 2019, a test batch of low-grade Amaruq ore was processed in the Meadowbank mill confirming ore characteristics and recoveries. Full year 2019 production guidance for the Meadowbank complex remains unchanged at 230,000 ounces of gold, including approximately 95,000 to 105,000 ounces from Meadowbank
- Production and cost guidance maintained for 2019 – Total production guidance remains unchanged at 1.75 million ounces of gold (including pre-commercial production from Meliadine and Amaruq). The Company anticipates that total cash costs per ounce and AISC per ounce for 2019 will continue to be in the range of $620 to $670 and $875 and $925, respectively
- Increased Capital Budget for 2019 – Total capital costs for 2019 are now estimated at $750 million (previous guidance was $660 million). The increased capital costs are primarily related to lower pre-commercial gold sales credited against capital at Meliadine, the advancement of the Amaruq underground development program (based on positive exploration results to date) and accelerated spending on the Meliadine saline water treatment system (due to the earlier than expected receipt of the discharge permit)
- A quarterly dividend of $0.125 per share was declared
3 Total cash costs per ounce is a non-GAAP measure and, unless otherwise specified, is reported on a byproduct basis. For a reconciliation to production costs and for total cash costs on a co-product basis, see "Reconciliation of Non-GAAP Financial Performance Measures" below. See also "Note Regarding Certain Measures of Performance".
4 All-in-sustaining costs ("AISC") per ounce is a non-GAAP measure and, unless otherwise specified, is reported on a by-product basis. For a reconciliation to production costs and for all-in sustaining costs on a coproduct basis, see "Reconciliation of Non-GAAP Financial Performance Measures" below. See also "Note Regarding Certain Measures of Performance".
- Exploration continues to enhance minesite and pipeline projects
- Amaruq exploration ramp and conversion results – The exploration ramp has reached 192 metres depth between the Whale Tail and V Zones; drilling from the ramp started in late June and is expected to increase the rate of conversion to underground indicated mineral resources
- Meliadine exploration focused on Tiriganiaq at depth – Two new lodes discovered approximately 75 metres north of previously known Tiriganiaq mineralization, at depth in the southwest, including 9.2 grams per tonne ("g/t") gold over 4.6 metres at 812 metres depth, the deepest reported intercept to date at Meliadine
- Kittila conversion yields strong grades and widths in Rimpi Zone – Conversion drilling cut three closely-spaced intercepts over 48 metres core length: 6.5 g/t gold over 3.9 metres, 9.7 g/t gold over 13.1 metres and 6.0 g/t gold over 13.6 metres at approximately 950 metres depth
- Santa Gertrudis exploration extends high-grade mineralization in Amelia Deposit – Recent drill results, such as 8.2 g/t gold over 7.3 metres at 208 metres depth, have extended the Amelia deposit (in the Trinidad Zone) to 700-metre strike length and 450-metre depth; the deposit remains open along strike and at depth
Second Quarter Financial and Production Highlights
In the second quarter of 2019, strong operational performance continued at the Company's mines, which led to payable gold production of 412,315 ounces which includes the precommercial production ounces at Meliadine and Amaruq. Not including the pre-commercial production ounces at Meliadine and Amaruq, payable gold production was 380,469 ounces. These figures compare to 404,961 ounces produced in the second quarter of 2018.
In the first six months of 2019, payable gold production was 810,532 ounces including the pre-commercial production ounces at Meliadine and Amaruq (not including the precommercial ounces, payable gold production was761,104 ounces), 794,239 ounces in the prior-year period.
The lower level of gold production in the second quarter of 2019 and the first six months of 2019 (excluding pre-commercial production ounces), when compared with the prior-year periods, was primarily due to expected reduced throughput levels and grades at Meadowbank as the mine transitions to the Amaruq satellite deposit, and mill maintenance shutdowns at LaRonde and Kittila. A detailed description of the production at each mine is set out below.
Production costs per ounce in the second quarter of 2019 were $735, compared to $750 in the prior-year period. Total cash costs per ounce in the second quarter of 2019 were $652, compared to $656 in the prior-year period.
Production costs per ounce in the first six months of 2019 were $731, compared to $754 in the prior-year period. Total cash costs per ounce in the first six months of 2019 were $638, compared to $652 in the prior-year period.
Production costs per ounce and total cash costs per ounce in the second quarter of 2019 and the first six months of 2019, when compared to the prior-year periods, were positively affected by lower costs at Kittila, Goldex and Creston Mascota, partially offset by lower gold production (excluding pre-commercial production ounces).
AISC per ounce in the second quarter of 2019 were $953, compared to $921 in the prioryear period. AISC per ounce in the first six months of 2019 were $895, compared to $906 in the prior-year period.
The higher AISC per ounce in the second quarter of 2019, when compared to the prior-year period, is primarily due to higher sustaining capital costs and lower gold production (excluding pre-commercial production ounces), partially offset by lower total cash costs per ounce.
The lower AISC per ounce in the first six months of 2019, when compared to the prior-year period, is primarily due to lower total cash costs, partially offset by slightly higher sustaining capital costs and lower gold production (excluding pre-commercial production ounces). A detailed description of the cost performance of each mine is set out below.
Cash Position – Strong Financial Flexibility
Cash and cash equivalents and short-term investments decreased to $125.6 million at June 30, 2019, from the March 31, 2019 balance of $196.5 million, as a result of capital spending primarily at the Company's Nunavut projects.
The outstanding balance on the Company's credit facility remained nil at June 30, 2019. This results in available credit lines of approximately $1.2 billion, not including the uncommitted $300 million accordion feature.
During the second quarter of 2019, DBRS Limited affirmed the Company's investment grade credit rating with a Positive Trend at BBB (low).
Approximately 38% of the Company's remaining 2019 Canadian dollar exposure is hedged at an average floor price of approximately 1.30 C$/US$. Approximately 37% of the Company's remaining 2019 Mexican peso exposure is hedged at an average floor price of approximately 19.00 MXP/US$. Approximately 14% of the Company's remaining 2019 Euro exposure is hedged at an average floor price of approximately 1.17 US$/EUR. The Company's full year 2019 cost guidance is based on assumed exchange rates of 1.28 C$/US$, 18.00 MXP/US$ and 1.18 US$/EUR. The Company anticipates adding to its operating currency hedges, subject to market conditions.
Approximately 55% of the Company's diesel exposure relating to its Nunavut operations for the July 2019 to July 2020 consumption period has been priced better than the 2019 cost guidance assumption of C$0.85 per litre (excluding transportation costs). The Company anticipates adding to its diesel hedge position, subject to market conditions.
Capital Expenditures
Total capital costs (including sustaining capital) for 2019 are now estimated at $750 million (previous guidance was $660 million). The increased capital costs primarily relate to lower pre-commercial gold sales credited against capital at Meliadine (approximately $36 million), the advancement of the Amaruq underground development program and conversion drilling based on positive exploration results to-date (approximately $21 million) and costs associated with the acceleration of work on the saline water treatment system at Meliadine (approximately $12 million). The Company received Ministerial approval to discharge saline water to the ocean in the second quarter of 2019, earlier than it had expected.
Total project development capital expenditures related to the construction of the Company's new Nunavut mines, Amaruq and Meliadine, are expected to be below the combined capital expenditure forecast of $1.23 billion. The total project development capital expenditures for Meliadine were approximately $830 million.
Anticipated pre-commercial production gold sales at Amaruq are incorporated in, and netted against, the total 2019 capital expenditure forecast. As a result, some variability is likely, depending on the timing of the achievement of commercial production, prevailing gold prices and foreign exchange rates.
At prevailing gold prices and foreign exchange rates, the Company continues to forecast a return to free cash flow generation in the second half of 2019.
The following table sets out capital expenditures (including sustaining capital) in the second quarter and the first six months of 2019.
Capital Expenditures (In thousands of US dollars)
Three Months Ended Six Months Ended June 30, 2019 June 30, 2019 Sustaining Capital
| LaRonde mine | $ 19,445 $ | 35,967 |
| LaRonde Zone 5 mine | 1,054 | 2,422 |
| Canadian Malartic mine | 9,897 | 17,403 |
| Meadowbank mine | — | — |
| Kittila mine | 30,470 | 43,593 |
| Goldex mine | 4,767 | 9,601 |
| Meliadine mine | 5,352 | 5,352 |
| Pinos Altos mine | 7,354 | 11,966 |
| Creston Mascota mine | — | — |
| La India mine | 2,981 | 3,644 |
| Total Sustaining Capital | $ 81,320 $ | 129,948 |
Development Capital
| LaRonde mine | $ 4,368 $ | 6,843 |
| LaRonde Zone 5 mine | 2,696 | 2,770 |
| Canadian Malartic mine | 9,192 | 17,414 |
| Amaruq satellite deposit | 53,841 | 104,468 |
| Amaruq underground project | 11,939 | 17,024 |
| Kittila mine | 21,489 | 37,843 |
| Goldex mine | 6,051 | 11,933 |
| Meliadine mine | 25,103 | 73,688 |
| Pinos Altos mine | 4,338 | 8,004 |
| Creston Mascota mine | — | — |
| La India mine | 1,741 | 2,860 |
| Other | 419 | 914 |
| Total Development Capital | $ 141,177 $ | 283,761 |
| Total Capital Expenditures | $ 222,497 $ | 413,709 |
2019 Production and Cost Guidance Unchanged
Production guidance for 2019 remains unchanged at 1.75 million ounces of gold (including pre-commercial production ounces from Meliadine and Amaruq). The Company anticipates that total cash costs per ounce and AISC per ounce for 2019 will continue to be in the range of $620 to $670 and $875 and $925, respectively.
Senior Management Changes
After 17 years in various capacities at the operational level with the Company, Christian Provencher, Vice President Operations – Canada will take a one-year leave of absence, beginning at the end of 2019.
As part of the Company's succession planning process, Daniel Paré was appointed Vice- President Operations – Eastern Canada on June 1, 2019, at which time he assumed responsibility for the life of mine and budget processes for the Company's Quebec and Ontario operations. At year-end, he will assume full responsibility for the management of these operations. Daniel is a professional mining engineer and a graduate of the École Polytechnique de Montréal at the Université de Montréal. He joined the Company in 2007 and has held various leadership roles with increasing responsibility, including General Manager of the Goldex and LaRonde mines. Most recently, Daniel was given assignments at the corporate level in the Project Evaluations, Corporate Development and Investors Relations departments to prepare for the transition to an executive position.
After 31 years of service with the Company, Alain Blackburn, Senior Vice-President, Exploration will be retiring in January 2020. To facilitate a smooth transition, Alain will step down as Senior Vice-President, Exploration on August 1, 2019, to take on a new role as Senior Vice-President, Strategic Adviser – Exploration until his retirement in January 2020. Guy Gosselin, who has held the role of Vice-President, Exploration since 2011, will take over from Alain as Senior Vice-President, Exploration, effective August 1, 2019. Guy is a graduate of the Université du Québec à Chicoutimi with a Bachelor of Science in Geological Engineering and a Masters of Science in Earth Sciences. He has more than 25 years of experience in exploration and has been with the Company since 2000, when he joined the LaRonde team as mine exploration geologist. He was appointed in 2002 as the LaRonde mine's chief geologist, a position that he held until 2005, at which time he moved to the position of exploration manager for Canada and was a significant contributor to the successful expansion of the Company into Nunavut.
After his retirement, Alain has agreed to continue as a consultant and strategic advisor to Agnico Eagle's senior management team on exploration and project evaluation matters.
Dividend Record and Payment Dates for the Third Quarter of 2019
Agnico Eagle's Board of Directors has declared a quarterly cash dividend of $0.125 per common share, payable on September 16, 2019, to shareholders of record as of August 30, 2019. Agnico Eagle has declared a cash dividend every year since 1983.
Other Expected Dividend and Record Dates for 2019
| Record Date | Payment Date |
| November 29 | December 16 |
Dividend Reinvestment Plan
Please see the following link for information on the Company's dividend reinvestment plan: Dividend Reinvestment Plan
Second Quarter 2019 Results Conference Call and Webcast Tomorrow
Agnico Eagle's senior management will host a conference call on Thursday, July 25, 2019 at 11:00 AM (E.D.T.) to discuss the Company's financial and operating results.
Via Webcast:
A live audio webcast of the conference call will be available on the Company's website www.agnicoeagle.com.
Via Telephone:
For those preferring to listen by telephone, please dial 1-647-427-7450 or toll-free 1-888- 231-8191. To ensure your participation, please call approximately five minutes prior to the scheduled start of the call.
Replay Archive:
Please dial 1-416-849-0833 or toll-free 1-855-859-2056, access code 7476376. The conference call replay will expire on August 28, 2019.
The webcast, along with presentation slides, will be archived for 180 days on the Company's website.
NORTHERN BUSINESS REVIEW
ABITIBI REGION, QUEBEC
Agnico Eagle is currently Quebec's largest gold producer with a 100% interest in the LaRonde, Goldex and LaRonde Zone 5 mines and a 50% interest in the Canadian Malartic mine. These mines are located within 50 kilometres of each other, which provides operating synergies and allows for the sharing of technical expertise.
LaRonde Mine – Strong Operating Performance Despite Underground and Mill Maintenance Shutdowns
The 100% owned LaRonde mine in northwestern Quebec achieved commercial production in 1988.
LaRonde Mine – Operating Statistics
June 30, 2019 June 30, 2018
| Tonnes of ore milled (thousands of tonnes) | 462 | 507 | ||
| Tonnes of ore milled per day | 5,077 | 5,571 | ||
| Gold grade (g/t) | 5.42 | 5.46 | ||
| Gold production (ounces) | 76,587 | 84,526 | ||
| Production costs per tonne (C$) | $ | 141 | $ | 158 |
| Minesite costs per tonne (C$) | $ | 138 | $ | 120 |
| Production costs per ounce of gold produced ($ per ounce) | $ | 637 | $ | 744 |
| Total cash costs per ounce of gold produced ($ per ounce) | $ | 506 | $ | 395 |
Production costs per tonne in the second quarter of 2019 decreased when compared to the prior-year period due to the timing of unsold concentrate inventory, partially offset by lower throughput. Production costs per ounce in the second quarter of 2019 decreased when compared to the prior-year period due to the reason described above, partially offset by lower gold production.
Minesite costs per tonne5 in the second quarter of 2019 increased when compared to the prior-year period due to lower throughput. Total cash costs per ounce in the second quarter of 2019 increased when compared to the prior-year period due to lower gold production and lower by-product revenue.
Gold production in the second quarter of 2019 decreased when compared to the prior-year period primarily due to lower tonnage as a result of a nine-day mill maintenance shutdown in May 2019.
5 Minesite costs per tonne is a non-GAAP measure. For a reconciliation of this measure to production costs as reported in the financial statements, see "Reconciliation of Non-GAAP Financial Performance Measures" below. See also "Note Regarding Certain Measures of Performance" below.
LaRonde Mine – Operating Statistics Six Months Ended Six Months Ended June 30, 2019 June 30, 2018
| Tonnes of ore milled (thousands of tonnes) | 1,009 | 1,038 | ||
| Tonnes of ore milled per day | 5,575 | 5,735 | ||
| Gold grade (g/t) | 5.00 | 5.48 | ||
| Gold production (ounces) | 154,020 | 174,311 | ||
| Production costs per tonne (C$) | $ | 146 | $ | 156 |
| Minesite costs per tonne (C$) | $ | 127 | $ | 120 |
| Production costs per ounce of gold produced ($ per ounce) | $ | 718 | $ | 733 |
| Total cash costs per ounce of gold produced ($ per ounce) | $ | 497 | $ | 412 |
Production costs per tonne in the first six months of 2019 decreased when compared to the prior-year period due to the timing of unsold concentrate inventory, partially offset by lower throughput. Production costs per ounce in the first six months of 2019 decreased when compared to the prior-year period due to the reason described above and lower gold production.
Minesite costs per tonne in the first six months of 2019 increased when compared to the prior-year period due to lower throughput. Total cash costs per ounce in the first six months of 2019 increased when compared to the prior-year period due to lower gold production and lower by-product metal revenues.
Gold production in the first six months of 2019 decreased when compared to the prior-year period primarily due to lower tonnage as a result of a nine-day mill maintenance shutdown in May 2019 and lower grades resulting from the mining sequence.
In order to address wear related issues in the ore handling system at LaRonde, a previously reported, 10-day unplanned, underground maintenance shutdown occurred in May 2019. The maintenance was preventative in nature and is part of an ongoing program to update and improve the existing underground infrastructure at the LaRonde mine.
Concurrent with the 10-day underground shutdown, a five-day planned mill maintenance shutdown occurred. In addition, there were four days of unscheduled maintenance on the LaRonde ball mill, for a total mill shutdown of nine days. These shutdowns resulted in lower tonnes processed in the second quarter of 2019.
During the second quarter of 2019, the Quebec government granted authorization to combine the daily capacity at both the LaRonde and LaRonde Zone 5 mill circuits, which increases production flexibility at the LaRonde Complex. Previously, ore milled at each operation had been accounted for separately.
Drilling continued at LaRonde 3 (the portion of the mine located below a depth of 3.1 kilometres) during the second quarter of 2019 and continued to focus on conversion drilling between 3.4 and 3.5 kilometres depth. In addition, infill definition drilling was carried out in the area of the mine where 2018 drilling successfully converted mineral resources to mineral reserves. Development plans are underway to deepen the ramp while engineering and construction work for ventilation and cooling of the deeper portion of the mine are ongoing.
As the Company mines deeper at LaRonde, the risks of more frequent and larger seismic events increases. As a result, the Company is studying various design approaches to LaRonde 3. In addition, the Company continues to adjust the mining methods, ground support and protocols to address seismic activity in the deeper portions of the mine.
Following the successful deployment of the LTE network at LaRonde Zone 5, an LTE network was deployed at the LaRonde mine below level 269 in 2018. Extension of the network in the main sector from level 269 to surface and at LaRonde 3 will take place throughout 2019. The LTE network facilitates the integration of automation technologies currently being tested at LaRonde Zone 5, which are expected to allow the Company to maintain similar productivity levels at LaRonde 3 as it historically achieved in the shallower portions of the mine.
Engineering work on Zone 11-3, which is at depth in the past-producing Bousquet 2 mine, is ongoing. This zone, containing approximately 140,000 ounces of gold in mineral reserves (1.2 million tonnes grading 3.77 g/t gold), is expected to provide production flexibility to the LaRonde Complex over the next few years.
LaRonde Zone 5 – Higher Grades and Throughput Continue to Drive Solid Quarterly Performance; Initial Autonomous Mining Testing Achieved Favourable Results
The Company acquired the LaRonde Zone 5 project in 2003. The property lies adjacent to and west of the LaRonde Complex and previous operators exploited the zone by open pit. In February 2017, the LaRonde Zone 5 project was approved by Agnico Eagle's Board of Directors for development. Commercial production was achieved in June 2018.
Production costs per tonne in the second quarter of 2019 were C$68. Production costs per ounce in the second quarter of 2019 were $759. Minesite costs per tonne in the second quarter of 2019 were C$70. Total cash costs per ounce in the second quarter of 2019 were $780. Gold production in the second quarter of 2019 was 16,170 ounces of gold with a total of approximately 241,000 tonnes of ore milled at 2.20 g/t gold.
Production costs per tonne in the first six months of 2019 were C$57. Production costs per ounce in the first six months of 2019 were $616. Minesite costs per tonne in the first six months of 2019 were C$68. Total cash costs per ounce in the first six months of 2019 were $733. Gold production in the first six months of 2019 was 29,158 ounces of gold with a total of approximately 422,000 tonnes of ore milled at 2.30 g/t gold.
In the second quarter of 2018 and in the first six months of 2018, LaRonde Zone 5 processed ore for 30 days as the mine achieved commercial production in June 2018. As a result, the operating results in the second quarter of 2019 and in the first six months of 2019 are not meaningfully comparable to the prior year periods.