Gold producers Agnico Eagle Mines Ltd., Tahoe Resources Inc. and Kinross Gold Corp. beat their first-quarter earnings estimates with impressive margins of 158%, 140% and 100%, respectively.
Agnico Eagle produced 418,216 ounces of gold in the first quarter, an increase over the 411,336 oz produced a year earlier, largely due to higher grades at the LaRonde and Meadowbank mines. The higher output from both mines led total cash costs down by 6% year on year.
Tahoe Resources Inc. generated earnings of US$74.7 million for the first quarter of 2017, compared with earnings of US$37.8 million a year earlier. The earnings were positively impacted by the inclusion of results from the Timmins and Shahuindo mines, combined with higher metals prices and an increase of approximately 1 Moz of silver sold at Escobal.
Kinross produced 671,956 oz of gold equivalent in the first quarter of 2017, compared with 687,463 oz a year earlier. All-in sustaining costs decreased to US$953/oz of gold equivalent, compared with US$956/oz a year ago.
Charlotte, N.C.-based lithium producer Albemarle Corp. beat its earnings estimate by 9%. Albemarle's lithium and advanced materials business booked net sales of US$284.4 million in the first quarter, an increase of 31.5% from the first quarter of 2016, largely due to favorable pricing impacts and increased sales volumes.
Freeport-McMoRan Inc., Agrium Inc. and Wheaton Precious Metals Corp. were the only companies that met their first-quarter 2017 estimates.
Freeport reported net income attributable to common stock of US$228 million for the quarter, compared with a net loss attributable to common stock of US$4.2 billion for the first quarter of 2016. However, Freeport's first-quarter sales of about 367,000 tonnes of copper and 182,000 oz of gold were lower than the company's January 2017 estimates of 453,600 tonnes of copper and 460,000 oz of gold, primarily reflecting lower volumes from Indonesia.
TSX-listed Canadian fertilizer producer Agrium fell to a US$11.0 million, or 8 cents per share, attributable net loss to shareholders in the first three months of the year, from an attributable net profit of US$2.0 million, or 2 cents per share, a year earlier. The dual-listed company attributed the loss to higher natural gas prices and lower phosphate prices relative to the first quarter of 2016.
Another TSX-listed fertilizer company, Potash Corp. of Saskatchewan Inc., beat its estimate by a significant margin of 58%. The company reported first quarter earnings of US$149 million, up from US$75 million generated in the same period of 2016. Potash Corp sees strong demand for potash continuing for the rest of 2017 and raised the lower end of its full-year guidance; it now forecasts between 8.9 Mt and 9.4 Mt of potash sales.
Agrium's merger with Potash Corp, announced in September 2016, is expected to be completed later this year.
Teck Resources Ltd., Mosaic Co. Lundin Mining Corp. and Cameco Corp. all missed their first-quarter S&P Capital IQ EPS estimates.
Despite missing its estimate, Teck's first-quarter profit (attributable to shareholders) of C$572 million represents a large increase from the same period a year ago. The increase was largely driven by substantially higher realized steelmaking coal prices, and to a lesser extent higher copper and zinc prices.
Copyright © 2017 by S&P Global Market Intelligence, a division of S&P Global Inc. All rights reserved. No content may be reproduced or distributed without the prior written permission of S&P Global Market Intelligence or its affiliates. The content is provided on an “as is” basis.
