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Form 6-K AGNICO EAGLE MINES LTD For: Sep 30

October 30, 2015 12:57 PM EDT

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549


Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR
15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of October, 2015.

Commission File Number 001-13422

AGNICO EAGLE MINES LIMITED



(Translation of registrant's name into English)

145 King Street East, Suite 400, Toronto, Ontario M5C 2Y7



(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F o     Form 40-F ý

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):                             

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101 (b)(7):                             

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes o    No ý

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b) : 82-                             

.

   



EXHIBITS

Exhibit No.
  Exhibit Description

99.1

  Third Quarter Report


SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

  AGNICO EAGLE MINES LIMITED
                        (Registrant)

Date: October 30, 2015                                                                         

       

 

By:

 

/s/ R. GREGORY LAING


R. Gregory Laing
General Counsel, Sr. Vice-President, Legal
and Corporate Secretary

Exhibit Number 99.1 submitted with this Form 6-K is hereby incorporated by reference into Agnico Eagle Mines Limited's Registration Statements on Form F-10 (Reg. No. 333-189715), Form F-3D (Reg. No. 333-190888) and Form S-8 (Reg. Nos. 333-130339 and 333-152004).




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EXHIBITS
SIGNATURES

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Exhibit 99.1

LOGO


Third Quarter Report 2015

 



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

        This Management's Discussion and Analysis ("MD&A") dated October 30, 2015 of Agnico Eagle Mines Limited ("Agnico Eagle" or the "Company") should be read in conjunction with the Company's unaudited condensed interim consolidated financial statements for the three and nine months ended September 30, 2015, prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). This MD&A should also be read in conjunction with the MD&A and consolidated financial statements included in the Company's Annual Report on Form 40-F for the year ended December 31, 2014 (the "Form 40-F"), prepared in accordance with IFRS. The Company has adopted IFRS as its basis of accounting, replacing US GAAP effective July 1, 2014. The condensed interim consolidated financial statements and MD&A are presented in United States dollars ("$" or "US$") and all units of measurement are expressed using the metric system, unless otherwise specified. Certain information in this MD&A is presented in Canadian dollars ("C$") or European Union euros ("Euros" or "€"). Additional information relating to the Company, including risk factors in the Form 40-F, is available on the Canadian Securities Administrators' (the "CSA") SEDAR website at www.sedar.com.

Business Overview

        Agnico Eagle is a senior Canadian gold mining company that has produced precious metals since 1957. The Company's nine mines are located in Canada, Mexico and Finland, with exploration and development activities in each of these regions as well as in the United States. The Company and its shareholders have full exposure to gold prices due to its long-standing policy of no forward gold sales. Agnico Eagle has declared a cash dividend every year since 1983.

        Agnico Eagle earns a significant proportion of its revenue and cash flow from the production and sale of gold in both dore bar and concentrate form. The remainder of revenue and cash flow is generated by the production and sale of by-product metals, primarily silver, zinc and copper.

        Agnico Eagle's nine mines are located in what the Company believes to be politically stable countries that are supportive of the mining industry. The political stability of the regions in which Agnico Eagle operates helps to provide confidence in its current and future prospects and profitability. This is important for Agnico Eagle as it believes that many of its new mines and recently acquired mining projects have long-term mining potential.

Financial and Operating Results

Balance Sheet Review

        Total assets as at September 30, 2015 of $6,805.6 million were comparable with December 31, 2014 total assets of $6,809.3 million. Cash and cash equivalents increased by $24.4 million to $202.0 million between December 31, 2014 and September 30, 2015 due primarily to cash provided by operating activities of $475.5 million, net proceeds from the sale of available-for-sale securities and warrants and the issuance of a $50.0 million note on September 30, 2015, partially offset by $316.8 million in capital expenditures, a net $176.1 million repayment of long-term debt and $44.6 million in dividends paid during the first nine months of 2015. Restricted cash decreased from $54.0 million at December 31, 2014 to $20.3 million at September 30, 2015 due primarily to the transfer of cash from a restricted trust account to a Canadian Malartic Corporation cash account during the third quarter of 2015. Ore in stockpiles and on leach pads inventories of $51.9 million at September 30, 2015 remained comparable with $52.0 million at December 31, 2014. Concentrates and dore bar inventories increased from $111.9 million at December 31, 2014 to $160.3 million at September 30, 2015 due primarily to a buildup of concentrates and dore bar inventories at the Canadian Malartic mine as mill throughput is increased toward capacity and to planned mine sequencing resulting in the buildup of concentrates and dore bar inventories at the La India and Lapa mines. Supplies inventories decreased marginally from $282.8 million at December 31, 2014 to $278.6 million at September 30, 2015 as supplies at the Meadowbank mine that were drawn down during the first six months of 2015 were replenished during the 2015 summer barge

2



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

shipping season. Available-for-sale securities decreased from $56.5 million at December 31, 2014 to $32.0 million at September 30, 2015 due to $29.7 million in disposals, $11.1 million in unrealized fair value losses and $8.1 million in impairment losses, partially offset by $24.4 million in new investments recorded during the first nine months of 2015. Long-term ore in stockpiles and on leach pads increased by $11.2 million from $25.1 million at December 31, 2014 to $36.3 million at September 30, 2015 due primarily to updated mine sequencing plans at the Kittila and Pinos Altos mines resulting in the reclassification of ore stockpiles from short-term to long-term. Property, plant and mine development decreased from $5,155.9 million at December 31, 2014 to $5,082.3 million at September 30, 2015 due primarily to amortization expense of $451.5 million, partially offset by $316.8 million in capital expenditures and property acquisitions totaling $67.5 million during the first nine months of 2015.

        Total liabilities decreased to $2,650.4 million at September 30, 2015 from $2,740.8 million at December 31, 2014 due primarily to $150.0 million in net Credit Facility repayments during the first nine months of 2015 and the June 30, 2015 settlement of the convertible debentures issued by Osisko Mining Corporation ("Osisko") and assumed by Canadian Malartic GP. A $42.1 million increase in accounts payable and accrued liabilities between December 31, 2014 and September 30, 2015 was due primarily to summer barge shipping season expenditures to the Meadowbank mine and Meliadine project and to a $12.7 million securities class action lawsuit settlement agreement which is expected to be covered by insurance. Agnico Eagle's net income taxes payable position of $17.7 million at December 31, 2014 compared with a net income taxes receivable position of $49.0 million at September 30, 2015 due primarily to payments to tax authorities during the first nine months of 2015.

        Certain previously reported Agnico Eagle consolidated balance sheet line items as at December 31, 2014 were updated to reflect adjusted final estimates of the fair value of identifiable assets acquired and liabilities assumed related to the June 16, 2014 joint acquisition of Osisko. As a result of new information obtained about the facts and circumstances that existed as of the Osisko acquisition date, the following adjustments were recorded to both the adjusted final purchase price allocation and the December 31, 2014 balance sheet as previously reported: the goodwill line item (not deductible for tax purposes) increased by $114.3 million; the property, plant and mine development line item decreased by $145.6 million and the deferred income and mining tax liabilities line item decreased by $35.0 million.

Fair Value of Derivative Financial Instruments

        The Company occasionally enters into contracts to limit the risk associated with decreased by-product metal prices, increased foreign currency costs (including capital expenditures) and input costs. The contracts act as economic hedges of underlying exposures and are not held for speculative purposes. Agnico Eagle does not use complex derivative contracts to hedge exposures. The fair value of the Company's derivative financial instruments is outlined in the financial instruments note to the condensed interim consolidated financial statements.

Results of Operations

        Agnico Eagle reported net income of $1.3 million, or $0.01 per share, in the third quarter of 2015 compared with a net loss of $15.1 million, or $0.07 per share, in the third quarter of 2014. In the third quarter of 2015, the operating margin (revenues from mining operations less production costs) increased to $254.2 million from $193.6 million in the third quarter of 2014 due primarily to a 26.3% increase in gold production and a 5.6% decrease in production costs, partially offset by a 10.4% decrease in the average realized price of gold between periods. Gold production increased to 441,124 ounces in the third quarter of 2015 compared with 349,273 ounces in the third quarter of 2014 due primarily to higher gold grade and tonnes of ore milled at the LaRonde mine, a 54.0% increase in tonnes of ore milled at the Kittila mine and higher gold grade at the Canadian Malartic, La India, Meadowbank and Pinos Altos mines. Cash provided by operating activities amounted to $143.7 million in the third quarter of 2015 compared with $71.2 million in the third quarter of 2014.

3



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Weighted average total cash costs per ounce of gold produced amounted to $536 on a by-product basis and $587 on a co-product basis in the third quarter of 2015 compared with $716 on a by-product basis and $794 on a co-product basis in the third quarter of 2014.

        In the first nine months of 2015, Agnico Eagle reported net income of $40.1 million, or $0.19 per share, compared with net income of $104.3 million, or $0.55 per share, in the first nine months of 2014. In the first nine months of 2015, the operating margin (revenues from mining operations less production costs) increased to $737.0 million from $676.4 million in the first nine months of 2014 due primarily to a 19.9% increase in gold production, partially offset by an 8.7% decrease in the average realized price of gold and a 6.7% increase in production costs between periods. Gold production increased to 1,249,012 ounces in the first nine months of 2015 compared with 1,041,753 ounces in the first nine months of 2014 due primarily to an incremental 136,298 attributable ounces for the full first nine months of 2015 from the Company's interest in the Canadian Malartic mine which was acquired on June 16, 2014, higher gold grade and tonnes of ore milled at the LaRonde mine, a 37.5% increase in tonnes of ore milled at the Kittila mine, the ramp up of production from the La India mine and the Goldex mine's M and E Zones which achieved commercial production in February 2014 and October 2013, respectively, and higher gold grade at the Pinos Altos and Lapa mines. Partially offsetting the overall increase in gold production between the first nine months of 2014 and the first nine months of 2015 was a 23.7% decrease in gold production at the Meadowbank mine due primarily to lower gold grade. Cash provided by operating activities amounted to $475.5 million in the first nine months of 2015 compared with $504.4 million in the first nine months of 2014. Weighted average total cash costs per ounce of gold produced amounted to $574 on a by-product basis and $633 on a co-product basis in the first nine months of 2015 compared with $627 on a by-product basis and $716 on a co-product basis in the first nine months of 2014.

        The table below sets out variances in the key drivers of net income for the three and nine months ended September 30, 2015 compared with the three and nine months ended September 30, 2014:

(millions of United States dollars)
  Three Months Ended
September 30, 2015
vs. Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
vs. Nine Months Ended
September 30, 2014
 

Increase in gold revenue

  $ 72.5   $ 120.1  

(Decrease) increase in silver revenue

    (19.2 )   2.6  

Decrease in net copper revenue

    (3.0 )   (6.9 )

Decrease in net zinc revenue

    (4.9 )   (7.0 )

Decrease in production costs due to weaker Canadian dollar, Mexican peso and Euro

    26.6     94.3  

Increase in production costs

    (11.4 )   (142.5 )

Increase in exploration and corporate development expenses

    (16.6 )   (42.8 )

Increase in amortization of property, plant and mine development

    (40.5 )   (156.9 )

(Increase) decrease in general and administrative expense

    (0.7 )   18.3  

Change in impairment loss on available-for-sale securities

    (6.6 )   (5.2 )

Decrease (increase) in finance costs

    1.2     (2.1 )

Change in gain on sale of available-for-sale securities

    0.8     19.2  

Change in non cash foreign currency translation

    (5.6 )   2.8  

Decrease in income and mining taxes

    36.7     59.1  

Other

    (13.0 )   (17.1 )
           

Total net income variance

  $ 16.3   $ (64.1 )
           

4



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Three Months Ended September 30, 2015 vs. Three Months Ended September 30, 2014

        Revenues from mining operations increased to $508.8 million in the third quarter of 2015 compared with $463.4 million in the third quarter of 2014 due primarily to a 26.3% increase in gold production between periods. An increase in tonnes of ore milled at the Kittila and LaRonde mines along with higher gold grades at the LaRonde mine resulted in a 91,851 ounce increase in gold production between the third quarter of 2014 and the third quarter of 2015. Partially offsetting the impact of increased gold production on revenues from mining operations was a 10.4% decrease in the average realized price of gold, a 15.7% decrease in the average realized price of silver and a 66.8% decrease in zinc production between periods.

        Production costs were $254.6 million in the third quarter of 2015, a 5.6% decrease compared with $269.8 million in the third quarter of 2014 due primarily to the impact of a weaker Canadian dollar, Mexican peso and Euro relative to the US dollar. Partially offsetting the total decrease in production costs between the third quarter of 2014 and the third quarter of 2015 was a 29.4% increase in tonnes of ore milled at the LaRonde mine and a $7.2 million increase in production costs at the Kittila mine due to a 54.0% increase in tonnes of ore milled between periods.

        Weighted average total cash costs per ounce of gold produced decreased to $536 on a by-product basis and $587 on a co-product basis in the third quarter of 2015 compared with $716 on a by-product basis and $794 on a co-product basis in the third quarter of 2014 due primarily to increased gold production at the LaRonde, Kittila and Canadian Malartic mines between periods and the impact on costs of a weaker Canadian dollar, Mexican peso and Euro relative to the US dollar. Partially offsetting the overall decrease in weighted average total cash costs per ounce of gold on a by-product basis produced between the third quarter of 2014 and the third quarter of 2015 were lower by-product revenue credits at the LaRonde mine. For a reconciliation of total cash costs per ounce of gold produced on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues) to production costs as presented in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) in accordance with IFRS, see Non-GAAP Financial Performance Measures in this MD&A.

        Exploration and corporate development expenses increased to $37.1 million in the third quarter of 2015 compared with $20.5 million in the third quarter of 2014 due primarily to exploration at the Amaruq project in Nunavut and the El Barqueno project in Mexico, and increased corporate development and project evaluation expenses between periods.

        Amortization of property, plant and mine development increased by $40.6 million to $158.0 million between the third quarter of 2014 and the third quarter of 2015 due primarily to increased gold production at the LaRonde and Kittila mines, an increase in depreciable mining properties at the Canadian Malartic mine between periods based on final estimates of fair value as at the June 16, 2014 acquisition date, and a ramp up in gold production at the La India mine related to the achievement of commercial production in February 2014.

        General and administrative expense increased to $25.7 million during the third quarter of 2015 compared with $25.0 million during the third quarter of 2014 due primarily to increased compensation and benefits expenses, partially offset by reduced consulting costs between periods.

        An impairment loss on certain available-for-sale securities of $7.1 million was recorded as at September 30, 2015 compared with $0.5 million as at September 30, 2014. Impairment loss evaluations of available-for-sale securities are based on whether a decline in fair value is considered to be significant or prolonged. A gain of $0.9 million was recorded on the sale of available-for-sale securities in the third quarter of 2015 compared with $0.1 million in the third quarter of 2014.

        During the third quarter of 2015, there was a non-cash foreign currency translation loss of $0.9 million attributable to the impact of a weakening of the Canadian dollar and Mexican peso versus the US dollar at

5



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

September 30, 2015 relative to June 30, 2015 on the Company's net monetary assets. A non-cash foreign currency translation gain of $4.7 million was recorded during the comparative third quarter of 2014.

        In the third quarter of 2015, the Company recorded an income and mining taxes recovery of $15.3 million on a loss before income and mining taxes of $14.0 million, resulting in an effective tax rate of 109.3%. In the third quarter of 2014, the Company recorded income and mining taxes expense of $21.4 million on income before income and mining taxes of $6.3 million. The decrease in the effective tax rate between the third quarter of 2014 and the third quarter of 2015 is due primarily to a decrease in taxable permanent differences and a decrease in foreign exchange rate movements.

        There are a number of factors that can significantly impact the Company's effective tax rate including varying rates in different jurisdictions, the non-recognition of certain tax assets, mining allowances, foreign currency exchange rate movements, changes in tax laws, the impact of specific transactions and assessments and the relative distribution of income in the Company's operating jurisdictions. As a result of these factors, the Company's effective tax rate is expected to fluctuate in future periods.

Nine Months Ended September 30, 2015 vs. Nine Months Ended September 30, 2014

        In the first nine months of 2015, revenues from mining operations increased to $1,502.5 million from $1,393.7 million in the first nine months of 2014 due primarily to a 19.9% increase in gold production and a 21.0% increase in silver production between periods. An incremental increase of 136,298 attributable ounces of gold production from the Canadian Malartic mine which was jointly acquired on June 16, 2014, higher gold grade and tonnes of ore milled at the LaRonde mine, an increase in tonnes of ore milled at the Kittila mine, and the ramp up of production from the La India mine which achieved commercial production in February 2014, partially offset by a 19.4% decrease in gold grade at the Meadowbank mine, resulted in a 207,259 ounce net increase in total gold production between the first nine months of 2014 and the first nine months of 2015. Partially offsetting the impact of increased gold and silver production on revenues from mining operations was a 8.7% decrease in the average realized price of gold, a 17.0% decrease in the average realized price of silver and a 69.0% decrease in zinc production between periods.

        Production costs were $765.5 million in the first nine months of 2015, a 6.7% increase compared with $717.2 million in the first nine months of 2014 due primarily to a $59.2 million increase in attributable production costs from the acquired interest in the Canadian Malartic mine, a $13.5 million increase in production costs at the Kittila mine due to a 37.5% increase in tonnes of ore milled and $12.9 million in additional production costs at the La India mine which achieved commercial production in February 2014 between periods. Partially offsetting the total increase in production costs between the first nine months of 2014 and the first nine months of 2015 was the impact of a weaker Canadian dollar, Mexican peso and Euro relative to the US dollar.

        Weighted average total cash costs per ounce of gold produced decreased to $574 on a by-product basis and $633 on a co-product basis in the first nine months of 2015 compared with $627 on a by-product basis and $716 on a co-product basis in the first nine months of 2014 due primarily to increased gold production and the impact on costs of a weaker Canadian dollar, Mexican peso and Euro relative to the US dollar. Partially offsetting the overall decrease in weighted average total cash costs per ounce of gold produced on a by-product basis between the first nine months of 2014 and the first nine months of 2015 was decreased gold production at the Meadowbank mine and lower by-product revenue credits at the LaRonde mine between periods. For a reconciliation of total cash costs per ounce of gold produced on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues) to production costs as presented in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) in accordance with IFRS, see Non-GAAP Financial Performance Measures in this MD&A.

6



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

        Exploration and corporate development expenses increased to $84.4 million in the first nine months of 2015 compared with $41.6 million in the first nine months of 2014 due primarily to exploration at the Amaruq project in Nunavut and the El Barqueno project in Mexico and increased corporate development and project evaluation expenses between periods.

        Amortization of property, plant and mine development increased by $156.9 million to $451.5 million between the first nine months of 2014 and the first nine months of 2015 due primarily to the consolidation of the acquired interest in the Canadian Malartic mine and the increase to its depreciable mining properties between periods due to the finalization of related acquisition date fair value estimates, increased gold production at the La Ronde and Kittila mines and a ramp up in gold production related to the achievement of commercial production at the La India mine in February 2014.

        General and administrative expense decreased to $74.5 million during the first nine months of 2015 compared with $92.8 million during the first nine months of 2014 due primarily to $16.7 million in transaction costs associated with the June 16, 2014 joint acquisition of Osisko and lower consulting expenses between periods. Partially offsetting the overall decrease in general and administrative expense, the Company consolidated its interest in the Canadian Malartic mine's general and administrative expense for the full first nine months of 2015. Transaction costs associated with the June 2015 acquisitions of Soltoro Ltd. ("Soltoro") and Gunnarn were capitalized to the mining properties acquired as both were accounted for as asset acquisitions.

        Impairment losses on certain available-for-sale securities of $8.1 million were recorded in the first nine months of 2015 compared with $2.9 million in the first nine months of 2014. Impairment loss evaluations of available-for-sale securities are based on whether a decline in fair value is considered to be significant or prolonged. A gain of $24.6 million was recorded on the sale of available-for-sale securities in the first nine months of 2015 compared with $5.4 million in the first nine months of 2014.

        During the first nine months of 2015, there was a non-cash foreign currency translation gain of $6.0 million mainly attributable to the impact of a weakening of the Canadian dollar, Mexican peso and Euro versus the US dollar at September 30, 2015 relative to December 31, 2014 on the Company's net monetary liabilities. A non-cash foreign currency translation gain of $3.2 million was recorded during the comparative first nine months of 2014.

        In the first nine months of 2015, the Company recorded income and mining taxes expense of $23.5 million on income before income and mining taxes of $63.6 million, resulting in an effective tax rate of 36.9%. In the first nine months of 2014, the Company recorded income and mining taxes expense of $82.6 million on income before income and mining taxes of $186.9 million, resulting in an effective tax rate of 44.2%. The decrease in the effective tax rate between the first nine months of 2014 and the first nine months of 2015 is due primarily to a decrease in taxable permanent differences, partially offset by foreign exchange rate movements.

LaRonde mine

        At the LaRonde mine, gold production increased by 91.7% to 71,860 ounces in the third quarter of 2015 compared with 37,490 ounces in the third quarter of 2014 due primarily to higher gold grade and an increase in tonnes of ore milled. Production costs at the LaRonde mine were $49.2 million in the third quarter of 2015, an increase of 4.6% compared with production costs of $47.1 million in the third quarter of 2014 driven primarily by increased mill throughput and higher local currency costs related to underground development, underground maintenance and site administration costs, partially offset by a weakening of the Canadian dollar relative to the US dollar.

        Gold production increased by 34.0% to 194,760 ounces in the first nine months of 2015 compared with 145,336 ounces in the first nine months of 2014 at the LaRonde mine, due primarily to higher gold grade and an

7



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

increase in tonnes of ore milled. Production costs at the LaRonde mine were $140.2 million in the first nine months of 2015, a decrease of 0.6% compared with production costs of $141.1 million in the first nine months of 2014 driven primarily by a weakening of the Canadian dollar relative to the US dollar, partially offset by increased mill throughput, higher local currency costs related to underground development and maintenance, and site administration costs and costs related to temporary issues with the paste fill piping network during the first nine months of 2015.

Lapa mine

        At the Lapa mine, gold production increased by 3.6% to 25,668 ounces in the third quarter of 2015 compared with 24,781 ounces in the third quarter of 2014 due primarily to increased mill recoveries and higher gold grade. Production costs at the Lapa mine were $12.3 million in the third quarter of 2015, a decrease of 11.6% compared with production costs of $13.9 million in the third quarter of 2014 driven primarily by a weakening of the Canadian dollar relative to the US dollar and decreased mill throughput due to downtime related to the discovery of fatigue cracks in the feed head of the Lapa mine's ball mill.

        Gold production increased by 6.0% to 71,038 ounces in the first nine months of 2015 compared with 67,011 ounces in the first nine months of 2014 at the Lapa mine, due primarily to higher gold grade and increased mill recoveries. Production costs at the Lapa mine were $39.9 million in the first nine months of 2015, a decrease of 8.4% compared with production costs of $43.6 million in the first nine months of 2014 driven primarily by a weakening of the Canadian dollar relative to the US dollar and decreased mill throughput due to a reduction in the number of stopes available for mining between periods and downtime related to the discovery of fatigue cracks in the feed head of the Lapa mine's ball mill.

Goldex mine

        On October 19, 2011, the Company suspended mining operations and gold production at the Goldex mine due to geotechnical concerns with the rock above the mining horizon. As of September 30, 2011, Agnico Eagle recorded an impairment loss on its investment in the Goldex mine (net of expected residual value) and its underground ore stockpile. All of the remaining 1.6 million ounces of proven and probable mineral reserves at the Goldex mine, other than ore stockpiled on the surface, were reclassified as mineral resources. An environmental remediation liability was recorded as of September 30, 2011 reflecting anticipated costs of remediation. The Goldex mill completed processing feed from the remaining Goldex Extension Zone ("GEZ") surface stockpile in October of 2011. Operations in the GEZ remain suspended indefinitely.

        During the three and nine months ended September 30, 2015, the Company incurred $0.2 million and $0.4 million in remediation costs, respectively, that were applied against the environmental remediation liability recognized in 2011. During the three and nine months ended September 30, 2014, the Company incurred $0.9 million and $2.9 million in remediation costs, respectively, that were applied against the environmental remediation liability recognized in 2011.

        Exploration drilling continued on several mineralized zones on the Goldex mine property near the GEZ after mining operations were suspended in October of 2011. A team of independent consultants and Agnico Eagle staff performed a thorough review, including a preliminary economic assessment, to determine whether future mining operations on the property, including the M and E zones, would be viable. After a review of the assessment, Agnico Eagle's Board of Directors (the "Board") approved the M and E Zones for development using existing mine infrastructure such as the shaft and mill. Commercial production was achieved at the Goldex mine's M and E Zones in October 2013.

        As a result of the Company's restatement of comparative information under IFRS, a $109.7 million impairment loss reversal was recorded as at the January 1, 2013 IFRS transition date. Specific long-lived assets associated with the GEZ that were impaired as at September 30, 2011 due to the suspension of mining

8



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

operations, including the Goldex mine's shaft and mill, were subsequently incorporated into the development plan for the Goldex mine's M and E Zones which was approved by the Board in July 2012.

        At the Goldex mine's M and E Zones, gold production increased by 16.1% to 32,068 ounces in the third quarter of 2015 compared with 27,611 ounces in the third quarter of 2014 due primarily to higher gold grade, an increase in tonnes of ore milled and increased mill recoveries. Production costs at the Goldex mine's M and E Zones were $16.1 million in the third quarter of 2015, a decrease of 0.6% compared with production costs of $16.2 million in the third quarter of 2014 driven primarily by increased mill throughput due to mining front maturity and productivity improvements, partially offset by a weakening of the Canadian dollar relative to the US dollar.

        Gold production increased by 23.7% to 87,780 ounces in the first nine months of 2015 compared with 70,970 ounces in the first nine months of 2014 at the Goldex mine's M and E Zones, due primarily to an increase in tonnes of ore milled, higher gold grade and increased mill recoveries. Production costs at the Goldex mine's M and E Zones were $47.9 million in the first nine months of 2015, an increase of 0.9% compared with production costs of $47.5 million in the first nine months of 2014 driven primarily by increased mill throughput between periods due to the exploitation of more mature mining fronts, partially offset by a weakening of the Canadian dollar weakened relative to the US dollar.

Meadowbank mine

        At the Meadowbank mine, gold production increased by 8.6% to 99,425 ounces in the third quarter of 2015 compared with 91,557 ounces in the third quarter of 2014 due primarily to higher gold grade. Production costs at the Meadowbank mine were $57.4 million in the third quarter of 2015, a decrease of 21.2% compared with production costs of $72.8 million in the third quarter of 2014 driven primarily by a weakening of the Canadian dollar relative to the US dollar and decreased mill throughput between periods.

        Gold production decreased by 23.7% to 279,224 ounces in the first nine months of 2015 compared with 366,162 ounces in the first nine months of 2014 at the Meadowbank mine, due primarily to lower gold grade, a decrease in tonnes of ore milled and lower mill recoveries. Production costs at the Meadowbank mine were $181.4 million in the first nine months of 2015, a decrease of 11.0% compared with production costs of $203.7 million in the first nine months of 2014 driven primarily by a weakening of the Canadian dollar relative to the US dollar and decreased mill throughput, partially offset by higher local currency costs related to site services and maintenance costs between periods.

Canadian Malartic mine

        Agnico Eagle and Yamana Gold Inc. ("Yamana") jointly acquired 100.0% of Osisko on June 16, 2014 by way of a plan of arrangement under the Canada Business Corporations Act (the "Arrangement"). As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of Osisko and Canadian Malartic GP, which now holds the Canadian Malartic mine. Agnico Eagle and Yamana will also jointly explore, through their indirect ownership of Canadian Malartic Corporation (the successor to Osisko), the Kirkland Lake assets, the Hammond Reef project and the Pandora and Wood-Pandora properties.

        At the Canadian Malartic mine, attributable gold production increased by 18.3% to 76,603 ounces in the third quarter of 2015 compared with 64,761 ounces in the third quarter of 2014 due primarily to higher gold grade. Attributable production costs at the Canadian Malartic mine were $42.0 million in the third quarter of 2015, a decrease of 12.3% compared with production costs of $47.9 million in the third quarter of 2014 driven primarily by a weakening of the Canadian dollar relative to the US dollar.

        During the first nine months of 2015, the Canadian Malartic mine produced 212,937 attributable ounces of gold and incurred attributable production costs of $125.4 million. Between its June 16, 2014 joint acquisition

9



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

date and September 30, 2014, the Canadian Malartic mine produced 76,639 attributable ounces of gold and incurred attributable production costs of $66.2 million.

Kittila mine

        At the Kittila mine, gold production increased by 64.6% to 46,455 ounces in the third quarter of 2015 compared with 28,230 ounces in the third quarter of 2014 due primarily to a scheduled shutdown in September of 2014 to tie-in the mill expansion. Production costs at the Kittila mine were $31.1 million in the third quarter of 2015, an increase of 29.9% compared with production costs of $24.0 million in the third quarter of 2014 driven primarily by the scheduled shutdown in September of 2014 to tie-in the mill expansion and higher local currency mill production costs between periods, partially offset by a weakening of the Euro relative to the US dollar.

        Gold production increased by 35.0% to 133,095 ounces in the first nine months of 2015 compared with 98,612 ounces in the first nine months of 2014 at the Kittila mine due primarily to an increase in tonnes of ore milled, partially offset by lower gold grade and mill recoveries between periods. Production costs at the Kittila mine were $93.9 million in the first nine months of 2015, an increase of 16.9% compared with production costs of $80.3 million in the first nine months of 2014 driven primarily by a 37.5% increase in mill throughput facilitated by the mill expansion completed in the fourth quarter of 2014, partially offset by a weakening of the Euro relative to the US dollar between periods.

Pinos Altos mine

        At the Pinos Altos mine, gold production increased by 16.0% to 47,725 ounces in the third quarter of 2015 compared with 41,155 ounces in the third quarter of 2014 due primarily to increases in gold grade and tonnes of ore milled, partially offset by a decrease in tonnes of ore stacked on the heap leach pad between periods. Production costs at the Pinos Altos mine were $26.8 million in the third quarter of 2015, a decrease of 8.4% compared with production costs of $29.3 million in the third quarter of 2014 driven primarily by a weakening of the Mexican peso relative to the US dollar and a decrease in tonnes of ore stacked on the heap leach pad, partially offset by an increase in mill throughput between periods.

        Gold production increased by 13.9% to 148,478 ounces in the first nine months of 2015 compared with 130,350 ounces in the first nine months of 2014 at the Pinos Altos mine, due primarily to increases in gold grade and tonnes of ore milled, partially offset by a decrease in tonnes of ore stacked on the heap leach pad between periods. Production costs at the Pinos Altos mine were $80.8 million in the first nine months of 2015, a decrease of 10.8% compared with production costs of $90.7 million in the first nine months of 2014 driven primarily by a weakening of the Mexican peso relative to the US dollar and a decrease in tonnes of ore stacked on the heap leach pad between periods, partially offset by an increase in mill throughput between periods.

Creston Mascota deposit at Pinos Altos

        At the Creston Mascota deposit at Pinos Altos, gold production decreased by 4.9% to 12,716 ounces in the third quarter of 2015 compared with 13,377 ounces in the third quarter of 2014 due primarily to a 7.4% decrease in ore stacked on the heap leach pad, partially offset by an increase in gold grade between periods. Production costs at the Creston Mascota deposit at Pinos Altos were $6.1 million in the third quarter of 2015, a decrease of 20.2% compared with production costs of $7.6 million in the third quarter of 2014 driven primarily by a weakening of the Mexican peso relative to the US dollar and a decrease in tonnes of ore stacked on the heap leach pad between periods.

        Gold production increased by 17.0% to 40,770 ounces in the first nine months of 2015 compared with 34,853 ounces in the first nine months of 2014 at the Creston Mascota deposit at Pinos Altos due primarily to increases in tonnes of ore stacked on the heap leach pad and gold grade. Production costs at the Creston Mascota deposit at Pinos Altos were $19.2 million in the first nine months of 2015, a decrease of 5.3% compared

10



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

with production costs of $20.3 million in the first nine months of 2014 driven primarily by a weakening of the Mexican peso relative to the US dollar, partially offset by an increase in tonnes of ore stacked on the heap leach pad between periods.

La India mine

        The La India mine achieved commercial production on February 1, 2014. During the third quarter of 2015, the La India mine produced 28,604 ounces of gold, a 40.8% increase compared with 20,311 ounces of gold in the third quarter of 2014 due primarily to higher gold grade. Production costs at the La India mine were $13.5 million in the third quarter of 2015, an increase of 22.5% compared with production costs of $11.0 million in the third quarter of 2014 driven primarily by the ramp up of ore stacked on the heap leach pad to design capacity, partially offset by a weakening of the Mexican peso relative to the US dollar between periods.

        During the first nine months of 2015, the La India mine produced 80,930 ounces of gold compared with 51,820 ounces of gold in the first nine months of 2014, including 3,492 ounces of gold produced prior to the achievement of commercial production on February 1, 2014. Production costs at the La India mine were $36.7 million in the first nine months of 2015 compared with $23.8 million in the first nine months of 2014 due primarily to the operations ramp up during the period in which commercial production was achieved. Partially offsetting the overall increase in production costs between periods was the impact of a weakening of the Mexican peso relative to the US dollar.

Liquidity and Capital Resources

        As at September 30, 2015, the Company's cash and cash equivalents, short-term investments and current restricted cash totaled $227.6 million compared with $215.3 million at December 31, 2014. The Company's policy is to invest excess cash in highly liquid investments of the highest credit quality to eliminate risks associated with these investments. Such investments with remaining maturities of greater than three months at the time of purchase are classified as short-term investments. Decisions regarding the length of maturities are based on cash flow requirements, rates of return and various other factors.

        Working capital (current assets less current liabilities) increased to $653.2 million at September 30, 2015 compared with $575.7 million at December 31, 2014.

Operating Activities

        Cash provided by operating activities increased by $72.5 million to $143.7 million in the third quarter of 2015 compared with $71.2 million in the third quarter of 2014 due primarily to a 26.3% increase in gold production and the impact of a weaker Canadian dollar, Mexican peso and Euro relative to the US dollar on costs between periods. Partially offsetting these positive impacts on cash provided by operating activities was a 10.4% decrease in the average realized price of gold and a $16.6 million increase in exploration and corporate development expenses between periods.

        Cash provided by operating activities decreased by $28.9 million to $475.5 million in the first nine months of 2015 compared with $504.4 million in the first nine months of 2014 due primarily to an 8.6% decrease in the average realized price of gold, a $48.2 million increase in production costs, a $42.8 million increase in exploration and corporate development expenses and the impact of a weaker Canadian dollar, Mexican peso and Euro relative to the US dollar on costs between periods. Partially offsetting these negative impacts on cash provided by operating activities was a 19.9% increase in gold production.

11



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Investing Activities

        Cash used in investing activities decreased to $100.4 million in the third quarter of 2015 compared with $131.7 million in the third quarter of 2014 due primarily to available-for-sale securities and warrants transactions, an incremental $8.0 million decrease in restricted cash between the third quarter of 2014 and the third quarter of 2015 and a $3.0 million decrease in capital expenditures between periods.

        In the third quarter of 2014, the Company purchased $13.9 million in available-for-sale securities and warrants compared with nil in the third quarter of 2015. In the third quarter of 2015, the Company received net proceeds of $4.7 million from the sale of available-for-sale securities and warrants compared with $0.5 million in the third quarter of 2014. The Company's investments in available-for-sale securities consist primarily of investments in common shares of entities in the mining industry.

        Cash used in investing activities decreased to $258.7 million in the first nine months of 2015 compared with $728.5 million in the first nine months of 2014 due primarily to $403.5 million in net cash expenditures associated with the Company's June 16, 2014 joint acquisition of Osisko, a $25.3 million decrease in capital expenditures, available-for-sale securities and warrants transactions and an incremental $22.7 million decrease in restricted cash between the first nine months of 2014 and the first nine months of 2015. The decrease in capital expenditures between periods is mainly attributable to significant construction expenditures incurred in the first nine months of 2014 related to the Kittila mine's mill expansion project which was completed ahead of schedule in 2014 and the La India mine which achieved commercial production in February 2014. Partially offsetting the overall decrease in capital expenditures between the first nine months of 2014 and the first nine months of 2015 were capital expenditures associated with the Canadian Malartic mine which was jointly acquired on June 16, 2014 and increased growth capital expenditures at the Goldex mine and Meliadine project between periods.

        In the first nine months of 2015, the Company purchased $19.4 million in available-for-sale securities and warrants compared with $27.2 million in the first nine months of 2014. In the first nine months of 2015, the Company received net proceeds of $61.0 million from the sale of available-for-sale securities and warrants compared with $40.6 million in the first nine months of 2014.

        On June 9, 2015, the Company acquired all of the issued and outstanding common shares of Soltoro Ltd. ("Soltoro"), including common shares issuable on the exercise of Soltoro's outstanding options and warrants, by way of a plan of arrangement under the Canada Business Corporations Act (the "Soltoro Arrangement"). Each outstanding share of Soltoro was exchanged under the Soltoro Arrangement for: (i) C$0.01 in cash; (ii) 0.00793 of an Agnico Eagle common share; and (iii) 1 common share of Palamina Corp., a company that was newly formed in connection with the Soltoro Arrangement. Pursuant to the Soltoro Arrangement, Soltoro transferred all mining properties located outside of the state of Jalisco, Mexico to Palamina Corp., while Soltoro retained all mining properties located within the state of Jalisco, Mexico. Agnico Eagle had no interest in Palamina Corp. upon the closing of the Soltoro Arrangement. Agnico Eagle's total purchase price of $26.7 million was comprised of $2.4 million in cash, including $1.6 million in cash contributed to Palamina Corp., and 770,429 Agnico Eagle common shares issued from treasury. The Soltoro acquisition was accounted for as an asset acquisition and transaction costs associated with the acquisition totaling $1.4 million were capitalized to the mining properties acquired.

        On June 11, 2015, the Company acquired 55.0% of the issued and outstanding common shares of Gunnarn Mining AB ("Gunnarn") from Orex Minerals Inc. ("Orex"), by way of a share purchase agreement and joint venture agreement (the "Gunnarn Agreements"). Agnico Eagle's total purchase price of $13.1 million was comprised of $6.0 million in cash and $7.1 million in accrued consideration. Pursuant to the Gunnarn Agreements, the $7.1 million in accrued consideration includes two $2.0 million payments to be made by the Company to Orex in cash or Agnico Eagle common shares at Agnico Eagle's sole discretion on June 11, 2016 and June 11, 2017, respectively. Agnico Eagle has also committed to $7.0 million in exploration expenditures associated with the Barsele project by June 11, 2018 and may earn an additional 15.0% interest in Gunnarn if the

12



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Company completes a pre-feasibility study related to the Barsele project. Under the Gunnarn Agreements, Agnico Eagle will hold a majority of the seats on the board of directors of Gunnarn and will be the sole operator of the Barsele project in exchange for customary management fees. The Gunnarn acquisition was accounted for as an asset acquisition and transaction costs associated with the acquisition totaling $0.6 million were capitalized to the mining properties acquired.

        On May 21, 2015, the Company subscribed for 62,500,000 common shares of Belo Sun Mining Corp. ("Belo Sun") in a non-brokered private placement at a price of C$0.24 per Belo Sun common share, for total cash consideration of C$15.0 million. After closing the transaction, the Company holds approximately 17.4% of the issued and outstanding common shares of Belo Sun.

        On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of Osisko by way of the Arrangement. As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of Osisko and Canadian Malartic GP, which now holds the Canadian Malartic mine. Agnico Eagle and Yamana will also jointly explore other properties that were held by Osisko (now Canadian Malartic Corporation) at the time of acquisition. Agnico Eagle has recognized its interest in the assets, liabilities, revenues and expenses of Osisko in accordance with the Company's rights and obligations prescribed by the Arrangement under IFRS. Agnico Eagle's share of Osisko's June 16, 2014 purchase price was comprised of cash payments totaling $462.7 million and 33,923,212 Agnico Eagle common shares valued at $1,135.1 million.

Financing Activities

        Cash provided by financing activities of $7.4 million in the third quarter of 2015 compared with cash used in financing activities of $35.9 million in the third quarter of 2014 due primarily to the issuance of a $50.0 million note on September 30, 2015, partially offset by a $4.3 million increase in the net repayment of long-term debt between the third quarter of 2014 and the third quarter of 2015.

        Cash used in financing activities of $180.3 million in the first nine months of 2015 compared with cash provided by financing activities of $247.9 million in the first nine months of 2014 due primarily to a swing from $285.4 million in net proceeds from long-term debt in the first nine months of 2014 to a $176.1 million net repayment of long-term debt in the first nine months of 2015 and to proceeds from the issuance of a $50.0 million note on September 30, 2015.

        On July 29, 2015, Agnico Eagle declared a quarterly cash dividend of $0.08 per common share paid on September 15, 2015 to holders of record of the common shares of the Company on September 1, 2015. Agnico Eagle has declared a cash dividend every year since 1983. In the third quarter of 2015, the Company paid dividends of $15.4 million compared with $14.5 million in the third quarter of 2014. In the first nine months of 2015, the Company paid dividends of $44.6 million compared with $39.5 million in the first nine months of 2014. Although the Company expects to continue paying dividends, future dividends will be at the discretion of the Board and will be subject to factors such as income, financial condition and capital requirements.

        On September 30, 2015, the Company closed a private placement consisting of a $50.0 million guaranteed senior unsecured note (the "2015 Note") with a September 30, 2025 maturity date and a yield of 4.15%. An amount equal to or greater than the net proceeds from the 2015 Note are to be applied toward mining projects in the Province of Quebec, Canada.

        On September 30, 2015, the Company amended its $1.2 billion Credit Facility, extending the maturity date from June 22, 2019 to June 22, 2020 and amending pricing terms. As at September 30, 2015, the Company's outstanding balance under the Credit Facility was $350.0 million. Credit Facility availability is reduced by outstanding letters of credit, amounting to $1.0 million at September 30, 2015. As at September 30, 2015, $849.0 million was available for future drawdown under the Credit Facility.

13



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

        On July 24, 2012, the Company closed a private placement consisting of $200.0 million of guaranteed senior unsecured notes (the "2012 Notes"). The 2012 Notes mature in 2022 and 2024 and at issuance had a weighted average maturity of 11.0 years and weighted average yield of 4.95%. Proceeds from the 2012 Notes were used to repay amounts outstanding under the Credit Facility.

        On April 7, 2010, the Company closed a private placement consisting of $600.0 million of guaranteed senior unsecured notes due in 2017, 2020 and 2022 (the "2010 Notes") with a weighted average maturity of 9.84 years and weighted average yield of 6.59%. Proceeds from the offering of the 2010 Notes were used to repay amounts under the Company's then outstanding credit facilities.

        On July 31, 2015, the Company amended its credit agreement with a financial institution relating to its uncommitted letter of credit facility (the "Letter of Credit Facility"). The amount available under the Letter of Credit Facility increased from C$175.0 million to C$200.0 million. The obligations of the Company under the Letter of Credit Facility are guaranteed by certain of its subsidiaries. The Letter of Credit Facility may be used to support the reclamation obligations or non-financial or performance obligations of the Company or its subsidiaries. As at September 30, 2015, $154.2 million had been drawn under the Letter of Credit Facility. Effective August 18, 2015, the financial institution and the Company agreed that the Company may draw up to C$250.0 million under the Letter of Credit Facility.

        On September 23, 2015, the Company entered into a C$150.0 million contract insurance bonding program agreement with Export Development Canada (the "EDC Facility"). Under the EDC Facility, Export Development Canada provides guarantees in respect of letters of credit issued on behalf of the Company to support certain performance obligations of the Company, its subsidiaries or any entity in which it has an interest. As at September 30, 2015, $17.3 million had been drawn under the EDC Facility.

        In connection with its joint acquisition of Osisko on June 16, 2014, Canadian Malartic GP was assigned and assumed certain outstanding debt and finance lease obligations of Osisko relating to the Canadian Malartic mine. Agnico Eagle's indirect attributable interest in such debt and finance lease obligations is as follows:

    A secured loan facility in the principal amount of C$75.0 million ($69.1 million) with scheduled C$20.0 million repayments on June 30, 2015, June 30, 2016 and June 30, 2017 and a 6.875% interest rate. A scheduled repayment of C$15.0 million ($14.1 million) was made subsequent to the June 16, 2014 acquisition date and the scheduled C$20.0 million ($16.0 million) repayment was made on June 30, 2015, resulting in attributable outstanding principal of $29.9 million as at September 30, 2015. On September 29, 2014, Canadian Malartic GP amended the acquired secured loan facility (the "CMGP Loan") with no change to maturity or pricing terms.

    Senior unsecured convertible debentures (the "Convertible Debentures") with principal outstanding of C$37.5 million ($34.6 million), a November 2017 maturity date and a 6.875% interest rate. As at the June 16, 2014 acquisition date, the Convertible Debentures had an attributable fair value of $44.9 million. On June 30, 2015, the negotiated early settlement of all of the Convertible Debentures was completed. As a result of this settlement, 871,680 Agnico Eagle common shares with a fair value of $24.8 million were released from a depositary to the holders of the Convertible Debentures along with a cash payment of $10.1 million to settle the Company's obligation. Additional cash consideration of $3.2 million was paid to the holders of the Convertible Debentures upon settlement and was recorded in the other expenses (income) line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss). In the nine months ended September 30, 2015 a $2.4 million mark-to-market loss was recorded in the other expenses (income) line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss) related to the Convertible Debentures. In the three and nine months ended September 30, 2014, mark-to-market gains of $7.0 million and $3.1 million were recorded related to the Convertible Debentures, respectively. As at September 30, 2015, the Convertible Debentures had principal outstanding of nil.

14



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

    A loan with principal outstanding of C$2.1 million ($2.0 million) with monthly repayments scheduled through the first quarter of 2015 and a 0.0% interest rate. As at September 30, 2015, the Company's attributable loan principal outstanding amounted to nil.

    Secured finance lease obligations of C$38.3 million ($35.3 million) provided in separate tranches with maturities ranging between 2015 and 2019 and a 7.5% interest rate. As at September 30, 2015, the Company's attributable finance lease obligations amounted to $19.2 million.

        The Company was in compliance with all covenants contained in the Credit Facility, 2015 Note, 2012 Notes and 2010 Notes as at September 30, 2015. Canadian Malartic GP was in compliance with all CMGP Loan covenants as at September 30, 2015.

        The Company issued common shares for gross proceeds of $3.4 million in the third quarter of 2015 and $9.1 million in the third quarter of 2014 attributable to employee stock option plan exercises, issuances under the incentive share purchase plan and the dividend re-investment plan. Gross proceeds from the issuance of common shares amounted to $21.3 million in the first nine months of 2015 and $25.0 million in the first nine months of 2014.

Risk Profile

        Volatility remains high in global financial markets and weakness in the global economy continues to have an impact on the profitability and liquidity of many businesses. Although there are signs of stabilization, the timing of a return to historical market conditions is uncertain. Weak economic conditions and volatile financial markets may have a significant impact on Agnico Eagle's cost and availability of financing and overall liquidity. The volatility in gold, silver, zinc and copper prices directly affects Agnico Eagle's revenues, earnings and cash flow. Volatile energy, commodity and consumables prices and currency exchange rates impact production costs. The volatility of global stock markets impacts the valuation of the Company's equity investments.

International Financial Reporting Standards

        The Company has adopted IFRS as its basis of accounting, replacing US GAAP effective July 1, 2014. As a result, Agnico Eagle's condensed interim consolidated financial statements for the three and nine months ended September 30, 2015 are reported in accordance with IFRS, with comparative information restated under IFRS and a transition date of January 1, 2013.

        Generally Accepted Accounting Principles ("GAAP") for Canadian publicly accountable enterprises became IFRS as issued by the International Accounting Standards Board in 2011 and the US Securities and Exchange Commission ("SEC") in the United States accepts financial statements prepared in accordance with IFRS without reconciliation to US GAAP from foreign private issuers. Accordingly, Agnico Eagle decided to convert its basis of accounting to IFRS to enhance the comparability of its financial statements to the Company's peers in the mining industry.

        Agnico Eagle developed and executed a detailed IFRS conversion plan including an assessment phase, an impact analysis and design phase and an implementation phase, culminating in the Company's initial reporting in accordance with IFRS for the three and nine months ended September 30, 2014.

15



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Disclosure Controls and Procedures and Internal Controls over Financial Reporting

        Pursuant to regulations adopted by the SEC under the Sarbanes-Oxley Act of 2002 and those of the CSA, the Company's management evaluates the effectiveness of the design and operation of the Company's disclosure controls as well as its procedures and internal controls over financial reporting. This evaluation is completed under the supervision of, and with the participation of, the Company's Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO").

        Management of the Company, with the participation of the CEO and CFO, is responsible for establishing and maintaining adequate internal controls over financial reporting. The Company's internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of consolidated financial statements for external purposes in accordance with IFRS. There have been no significant changes in the Company's internal control over financial reporting in the third quarter of 2015 that have materially affected, or are reasonably likely to materially affect, the reliability of financial reporting.

        The Company's management, including the CEO and CFO, recognizes there are inherent limitations in any system of disclosure controls and procedures and internal controls over financial reporting, no matter how well designed. Therefore, even those systems that are considered to be effective can provide only reasonable assurance that the objectives of the control system are met.

Non-GAAP Financial Performance Measures

        This MD&A presents certain financial performance measures, including adjusted net income, total cash costs per ounce of gold produced, minesite costs per tonne and all-in sustaining costs per ounce of gold produced, that are not recognized measures under IFRS. This data may not be comparable to data presented by other gold producers. Non-GAAP financial performance measures should be considered together with other data prepared in accordance with IFRS.

16



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Adjusted Net Income

        Adjusted net income is not a recognized measure under IFRS and this data may not be comparable to data presented by other gold producers. This measure is calculated by adjusting net income (loss) as recorded in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for non-recurring, unusual and other items. The Company believes that this generally accepted industry measure allows the evaluation of the results of continuing operations and is useful in making comparisons between periods. Adjusted net income is intended to provide investors with information about the Company's continuing income generating capabilities. Management uses this measure to monitor and plan for the operating performance of the Company in conjunction with other data prepared in accordance with IFRS.

 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
(thousands of United States dollars)
  2015   2014   2015   2014  

Net income (loss) for the period — basic

  $ 1,294   $ (15,050 ) $ 40,120   $ 104,253  

Less: Dilutive impact of Convertible Debentures(i)

        (6,522 )       (2,602 )
                   

Net income (loss) for the period — diluted

  $ 1,294   $ (21,572 ) $ 40,120   $ 101,651  
                   

Impairment loss on available-for-sale securities

    7,076     462     8,106     2,881  

Gain on sale of available-for-sale securities

    (875 )   (83 )   (24,599 )   (5,372 )

Foreign currency translation loss (gain)

    902     (4,679 )   (6,009 )   (3,170 )

Stock options expense

    4,062     3,481     15,912     16,630  

Mark-to-market loss on warrants

    363     6,254     2,133     928  

Loss (gain) on settlement of warrants

        4,679     (9,072 )   4,865  

Loss (gain) on other derivative financial instruments

    16,188     (46 )   23,229     (2,055 )

Mark-to-market (gain) loss on Convertible Debentures(ii)

        (6,971 )   2,416     (3,125 )

Income and mining taxes adjustments

    6,821     11,253     20,214     4,459  

Other

    3,387     4,962     16,638     7,360  
                   

Adjusted net income for the period — basic

  $ 39,218   $ 4,262   $ 89,088   $ 127,654  
                   

Adjusted net income for the period — diluted

  $ 39,218   $ 4,711   $ 89,088   $ 128,177  
                   

Net income (loss) per share — basic

  $ 0.01   $ (0.07 ) $ 0.19   $ 0.55  

Net income (loss) per share — diluted

  $ 0.01   $ (0.10 ) $ 0.19   $ 0.53  

Adjusted net income per share — basic

  $ 0.18   $ 0.02   $ 0.41   $ 0.67  

Adjusted net income per share — diluted

  $ 0.18   $ 0.02   $ 0.41   $ 0.67  

Notes:

(i)
In connection with the joint acquisition of Osisko Mining Corporation on June 16, 2014, Agnico Eagle indirectly assumed its attributable interest in senior unsecured convertible debentures (the "Convertible Debentures"). The impact of the Convertible Debentures has been included in the calculation of diluted net income (loss) per share where dilutive and has been excluded from the calculation of diluted net income (loss) per share where anti-dilutive. On June 30, 2015, the negotiated early settlement of all the Convertible Debentures was completed, resulting in principal outstanding of nil.

(ii)
Where the impact of the Convertible Debentures is dilutive, the adjustment for mark-to-market (gain) loss on Convertible Debentures is excluded from the calculation of adjusted net income for the period on a diluted as it is already incorporated in the calculation of net income (loss) for the period on a diluted basis.

17



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Total Cash Costs per Ounce of Gold Produced and Minesite Costs per Tonne

        The Company believes that total cash costs per ounce of gold produced and minesite costs per tonne are realistic indicators of operating performance and facilitate period over period comparisons. However, both of these non-GAAP generally accepted industry measures should be considered together with other data prepared in accordance with IFRS. These measures, taken by themselves, are not necessarily indicative of operating costs or cash flow measures prepared in accordance with IFRS.

        Total cash costs per ounce of gold produced is presented on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for by-product revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. Accordingly, the calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash cost per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs per ounce of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne (discussed below) as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates.

        Agnico Eagle's primary business is gold production and the focus of its current operations and future development is on maximizing returns from gold production, with other metal production being incidental to the gold production process. Accordingly, all metals other than gold are considered by-products.

        Total cash costs per ounce of gold produced is presented on a by-product basis because (i) the majority of the Company's revenues are gold revenues, (ii) the Company mines ore, which contains gold, silver, zinc, copper and other metals, (iii) it is not possible to specifically assign all costs to revenues from the gold, silver, zinc, copper and other metals the Company produces, and (iv) it is a method used by management and the Board to monitor operations.

        Minesite costs per tonne is calculated by adjusting production costs as shown in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for unsold concentrate inventory production costs and other adjustments and then dividing by tonnes of ore processed. As the total cash costs per ounce of gold produced measure can be impacted by fluctuations in by-product metal prices and exchange rates, management believes that the minesite costs per tonne measure provides additional information regarding the performance of mining operations. Management also uses minesite costs per tonne to determine the economic viability of mining blocks. As each mining block is evaluated based on the net realizable value of each tonne mined, in order to be economically viable the estimated revenue on a per tonne basis must be in excess of the minesite costs per tonne. Management is aware that this per tonne measure of performance can be impacted by fluctuations in production levels and compensates for this inherent limitation by using this measure in conjunction with production costs prepared in accordance with IFRS.

18



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

        Total cash costs per ounce of gold produced and minesite costs per tonne have been restated to conform with IFRS for all reported periods.

        The following tables set out a reconciliation of total cash costs per ounce of gold produced (on both a by-product basis and co-product basis) and minesite costs per tonne to production costs, exclusive of amortization, as presented in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) in accordance with IFRS.

Total Production Costs by Mine

(thousands of United States dollars)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

LaRonde mine

  $ 49,243   $ 47,070   $ 140,242   $ 141,107  

Lapa mine

    12,279     13,887     39,919     43,593  

Goldex mine

    16,120     16,222     47,900     47,486  

Meadowbank mine

    57,404     72,838     181,387     203,725  

Canadian Malartic mine(i)

    42,008     47,882     125,380     66,215  

Kittila mine

    31,116     23,963     93,892     80,347  

Pinos Altos mine

    26,845     29,293     80,824     90,652  

Creston Mascota deposit at Pinos Altos

    6,101     7,644     19,208     20,278  

La India mine(ii)

    13,468     10,994     36,724     23,839  
                   

Production costs per the interim condensed consolidated statements of income (loss) and comprehensive income (loss)

  $ 254,584   $ 269,793   $ 765,476   $ 717,242  
                   

19



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Reconciliation of Production Costs to Total Cash Costs per Ounce of Gold Produced(iii) by Mine and Reconciliation of Production Costs to Minesite Costs per Tonne(iv) by Mine

LaRonde Mine — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 49,243   $ 47,070   $ 140,242   $ 141,107  

Adjustments:

                         

Inventory and other adjustments(v)

    1,106     2,273     14,570     21,437  
                   

Cash operating costs (co-product basis)

  $ 50,349   $ 49,343   $ 154,812   $ 162,544  

By-product metal revenues

    (10,291 )   (17,078 )   (34,125 )   (60,722 )
                   

Cash operating costs (by-product basis)

  $ 40,058   $ 32,265   $ 120,687   $ 101,822  

Gold production (ounces)

    71,860     37,490     194,760     145,336  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 701   $ 1,316   $ 795   $ 1,118  
                   

By-product basis

  $ 558   $ 861   $ 620   $ 701  
                   

LaRonde Mine — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 49,243   $ 47,070   $ 140,242   $ 141,107  

Inventory and other adjustments(vi)

    (1,454 )   (3,488 )   266     326  
                   

Minesite operating costs

  $ 47,789   $ 43,582   $ 140,508   $ 141,433  

Minesite operating costs (thousands of C$)

  C$ 55,417   C$ 47,474   C$ 169,680   C$ 154,785  

Tonnes of ore milled (thousands of tonnes)

    551     426     1,678     1,547  
                   

Minesite costs per tonne (C$)(iv)

  C$ 101   C$ 111   C$ 101   C$ 100  
                   

20



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Lapa Mine — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 12,279   $ 13,887   $ 39,919   $ 43,593  

Adjustments:

                         

Inventory and other adjustments(v)

    1,117     1,141     1,407     2,608  
                   

Cash operating costs (co-product basis)

  $ 13,396   $ 15,028   $ 41,326   $ 46,201  

By-product metal revenues

    (2 )   (3 )   (20 )   (6 )
                   

Cash operating costs (by-product basis)

  $ 13,394   $ 15,025   $ 41,306   $ 46,195  

Gold production (ounces)

    25,668     24,781     71,038     67,011  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 522   $ 606   $ 582   $ 689  
                   

By-product basis

  $ 522   $ 606   $ 581   $ 689  
                   

Lapa Mine — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 12,279   $ 13,887   $ 39,919   $ 43,593  

Inventory and other adjustments(vi)

    406     1,086     297     2,544  
                   

Minesite operating costs

  $ 12,685   $ 14,973   $ 40,216   $ 46,137  

Minesite operating costs (thousands of C$)

  C$ 16,614   C$ 16,310   C$ 50,610   C$ 50,492  

Tonnes of ore milled (thousands of tonnes)

    146     157     424     477  
                   

Minesite costs per tonne (C$)(iv)

  C$ 114   C$ 104   C$ 119   C$ 106  
                   

21



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Goldex Mine — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 16,120   $ 16,222   $ 47,900   $ 47,486  

Adjustments:

                         

Inventory and other adjustments(v)

    (744 )   (147 )   66     (559 )
                   

Cash operating costs (co-product basis)

  $ 15,376   $ 16,075   $ 47,966   $ 46,927  

By-product metal revenues

    (2 )   (5 )   (15 )   (16 )
                   

Cash operating costs (by-product basis)

  $ 15,374   $ 16,070   $ 47,951   $ 46,911  

Gold production (ounces)

    32,068     27,611     87,780     70,970  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 479   $ 582   $ 546   $ 661  
                   

By-product basis

  $ 479   $ 582   $ 546   $ 661  
                   

Goldex Mine — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 16,120   $ 16,222   $ 47,900   $ 47,486  

Inventory and other adjustments(vi)

    (1,497 )   (175 )   (1,064 )   (507 )
                   

Minesite operating costs

  $ 14,623   $ 16,047   $ 46,836   $ 46,979  

Minesite operating costs (thousands of C$)

  C$ 19,168   C$ 17,481   C$ 58,803   C$ 51,414  

Tonnes of ore milled (thousands of tonnes)

    570     538     1,741     1,542  
                   

Minesite costs per tonne (C$)(iv)

  C$ 34   C$ 32   C$ 34   C$ 33  
                   

22



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Meadowbank Mine — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 57,404   $ 72,838   $ 181,387   $ 203,725  

Adjustments:

                         

Inventory and other adjustments(v)

    2,642     (1,136 )   2,088     3,344  
                   

Cash operating costs (co-product basis)

  $ 60,046   $ 71,702   $ 183,475   $ 207,069  

By-product metal revenues

    (543 )   (570 )   (3,210 )   (1,615 )
                   

Cash operating costs (by-product basis)

  $ 59,503   $ 71,132   $ 180,265   $ 205,454  

Gold production (ounces)

    99,425     91,557     279,224     366,162  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 604   $ 783   $ 657   $ 566  
                   

By-product basis

  $ 598   $ 777   $ 646   $ 561  
                   

Meadowbank Mine — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 57,404   $ 72,838   $ 181,387   $ 203,725  

Inventory and other adjustments(vi)

    (1,643 )   (1,224 )   (3,717 )   3,716  
                   

Minesite operating costs

  $ 55,761   $ 71,614   $ 177,670   $ 207,441  

Minesite operating costs (thousands of C$)

  C$ 71,519   C$ 78,009   C$ 217,436   C$ 227,023  

Tonnes of ore milled (thousands of tonnes)

    996     1,057     3,005     3,102  
                   

Minesite costs per tonne (C$)(iv)

  C$ 72   C$ 74   C$ 72   C$ 73  
                   

23



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Canadian Malartic Mine — Total Cash Costs per Ounce of Gold Produced(i)(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 42,008   $ 47,882   $ 125,380   $ 66,215  

Adjustments:

                         

Inventory and other adjustments(v)

    781     935     4,335     (9,762 )
                   

Cash operating costs (co-product basis)

  $ 42,789   $ 48,817   $ 129,715   $ 56,453  

By-product metal revenues

    (1,134 )   (1,213 )   (3,453 )   (1,541 )
                   

Cash operating costs (by-product basis)

  $ 41,655   $ 47,604   $ 126,262   $ 54,912  

Gold production (ounces)

    76,603     64,761     212,937     76,639  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 559   $ 754   $ 609   $ 737  
                   

By-product basis

  $ 544   $ 735   $ 593   $ 717  
                   

Canadian Malartic Mine — Minesite Costs per Tonne(i)(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 42,008   $ 47,882   $ 125,380   $ 66,215  

Inventory and other adjustments(vi)

    52     719     1,784     (10,029 )
                   

Minesite operating costs

  $ 42,060   $ 48,601   $ 127,164   $ 56,186  

Minesite operating costs (thousands of C$)

  C$ 55,010   C$ 52,942   C$ 160,136   C$ 61,491  

Tonnes of ore milled (thousands of tonnes)

    2,470     2,417     7,117     2,815  
                   

Minesite costs per tonne (C$)(iv)

  C$ 22   C$ 22   C$ 23   C$ 22  
                   

24



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Kittila Mine — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 31,116   $ 23,963   $ 93,892   $ 80,347  

Adjustments:

                         

Inventory and other adjustments(v)

    (1,401 )   2,915     (1,088 )   4,677  
                   

Cash operating costs (co-product basis)

  $ 29,715   $ 26,878   $ 92,804   $ 85,024  

By-product metal revenues

    (44 )   (26 )   (116 )   (87 )
                   

Cash operating costs (by-product basis)

  $ 29,671   $ 26,852   $ 92,688   $ 84,937  

Gold production (ounces)

    46,455     28,230     133,095     98,612  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 640   $ 952   $ 697   $ 862  
                   

By-product basis

  $ 639   $ 951   $ 696   $ 861  
                   

Kittila Mine — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 31,116   $ 23,963   $ 93,892   $ 80,347  

Inventory and other adjustments(vi)

    (1,442 )   2,817     (1,243 )   4,313  
                   

Minesite operating costs

  $ 29,674   $ 26,780   $ 92,649   $ 84,660  

Minesite operating costs (thousands of €)

  26,160   20,217   81,169   62,488  

Tonnes of ore milled (thousands of tonnes)

    362     235     1,087     790  
                   

Minesite costs per tonne (€)(iv)

  72   86   75   79  
                   

25



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Pinos Altos Mine — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 26,845   $ 29,293   $ 80,824   $ 90,652  

Adjustments:

                         

Inventory and other adjustments(v)

    731     485     3,084     1,395  
                   

Cash operating costs (co-product basis)

  $ 27,576   $ 29,778   $ 83,908   $ 92,047  

By-product metal revenues

    (8,865 )   (7,344 )   (27,842 )   (25,229 )
                   

Cash operating costs (by-product basis)

  $ 18,711   $ 22,434   $ 56,066   $ 66,818  

Gold production (ounces)

    47,725     41,155     148,478     130,350  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 578   $ 724   $ 565   $ 706  
                   

By-product basis

  $ 392   $ 545   $ 378   $ 513  
                   

Pinos Altos Mine — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 26,845   $ 29,293   $ 80,824   $ 90,652  

Inventory and other adjustments(vi)

    (498 )   96     449     (1 )
                   

Minesite operating costs

  $ 26,347   $ 29,389   $ 81,274   $ 90,651  

Tonnes of ore processed (thousands of tonnes)

    546     607     1,778     1,887  
                   

Minesite costs per tonne (US$)(iv)

  $ 48   $ 48   $ 46   $ 48  
                   

26



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

Creston Mascota deposit at Pinos Altos — Total Cash Costs per Ounce of Gold Produced(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 6,101   $ 7,644   $ 19,208   $ 20,278  

Adjustments:

                         

Inventory and other adjustments(v)

    (27 )   233     (171 )   1,317  
                   

Cash operating costs (co-product basis)

  $ 6,074   $ 7,877   $ 19,037   $ 21,595  

By-product metal revenues

    (534 )   (442 )   (1,692 )   (1,152 )
                   

Cash operating costs (by-product basis)

  $ 5,540   $ 7,435   $ 17,345   $ 20,443  

Gold production (ounces)

    12,716     13,377     40,770     34,853  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 478   $ 589   $ 467   $ 620  
                   

By-product basis

  $ 436   $ 556   $ 425   $ 587  
                   

Creston Mascota deposit at Pinos Altos — Minesite Costs per Tonne(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 6,101   $ 7,644   $ 19,208   $ 20,278  

Inventory and other adjustments(vi)

    (137 )   115     (429 )   1,033  
                   

Minesite operating costs

  $ 5,964   $ 7,759   $ 18,779   $ 21,311  

Tonnes of ore processed (thousands of tonnes)

    434     469     1,570     1,243  
                   

Minesite costs per tonne (US$)(iv)

  $ 14   $ 17   $ 12   $ 17  
                   

27



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

La India Mine — Total Cash Costs per Ounce of Gold Produced(ii)(iii)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 13,468   $ 10,994   $ 36,724   $ 23,839  

Adjustments:

                         

Inventory and other adjustments(v)

    (21 )   869     697     1,685  
                   

Cash operating costs (co-product basis)

  $ 13,447   $ 11,863   $ 37,421   $ 25,524  

By-product metal revenues

    (975 )   (746 )   (3,286 )   (2,175 )
                   

Cash operating costs (by-product basis)

  $ 12,472   $ 11,117   $ 34,135   $ 23,349  

Gold production (ounces)

    28,604     20,311     80,930     48,328  

Total cash costs per ounce of gold produced ($ per ounce)(iii):

                         

Co-product basis

  $ 470   $ 584   $ 462   $ 528  
                   

By-product basis

  $ 436   $ 547   $ 422   $ 483  
                   

La India Mine — Minesite Costs per Tonne(ii)(iv)

(thousands of United States dollars,
except as noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs

  $ 13,468   $ 10,994   $ 36,724   $ 23,839  

Inventory and other adjustments(vi)

    (161 )   851     202     1,430  
                   

Minesite operating costs

  $ 13,307   $ 11,845   $ 36,926   $ 25,269  

Tonnes of ore processed (thousands of tonnes)

    1,194     1,190     3,932     3,015  
                   

Minesite costs per tonne (US$)(iv)

  $ 11   $ 10   $ 9   $ 8  
                   

Notes:

(i)
On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of Osisko by way of the Arrangement. As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of Osisko (now Canadian Malartic Corporation) and Canadian Malartic GP, which now holds the Canadian Malartic mine. The information set out in this table reflects the Company's 50.0% interest in the Canadian Malartic mine since the date of acquisition.

(ii)
The La India mine achieved commercial production on February 1, 2014. 3,492 ounces of payable gold production were excluded from the calculation of total cash costs per ounce of gold produced in the nine months ended September 30, 2014 as they were produced prior to the achievement of commercial production.

(iii)
Total cash costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data presented by other gold producers. Total cash costs per ounce of gold produced is presented on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for by-product metal revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. Accordingly, the calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining

28



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

    and marketing charges associated with the production and sale of by-product metals. The Company believes that these generally accepted industry measures provide a realistic indication of operating performance and provide useful comparison points between periods. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne (discussed below) as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates.

(iv)
Minesite costs per tonne is not a recognized measure under IFRS and this data may not be comparable to data presented by other gold producers. Minesite costs per tonne is calculated by adjusting production costs as shown in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for unsold concentrate inventory production costs and other adjustments, and then dividing by tonnes of ore processed. As the total cash costs per ounce of gold produced measure can be impacted by fluctuations in by-product metal prices and exchange rates, management believes that the minesite costs per tonne measure provides additional information regarding the performance of mining operations. Management also uses minesite costs per tonne to determine the economic viability of mining blocks. As each mining block is evaluated based on the net realizable value of each tonne mined, in order to be economically viable the estimated revenue on a per tonne basis must be in excess of the minesite costs per tonne. Management is aware that this per tonne measure of performance can be impacted by fluctuations in processing levels and compensates for this inherent limitation by using this measure in conjunction with production costs prepared in accordance with IFRS.

(v)
Under the Company's revenue recognition policy, revenue is recognized on concentrates when legal title and risk is transferred. As total cash costs per ounce of gold produced are calculated on a production basis, an inventory adjustment is made to reflect the sales margin on the portion of concentrate production not yet recognized as revenue. Other adjustments include the addition of smelting, refining and marketing charges to production costs.

(vi)
This inventory and other adjustment reflects production costs associated with unsold concentrates.

All-in Sustaining Costs per Ounce of Gold Produced

        All-in sustaining costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data presented by other gold producers. The Company believes that this measure provides information about operating performance. However, this non-GAAP measure should be considered together with other data prepared in accordance with IFRS as it is not necessarily indicative of operating costs or cash flow measures prepared in accordance with IFRS.

        Based on the recommendations of the World Gold Council made in 2013, the Company modified its calculation of all-in sustaining costs per ounce of gold produced beginning in 2014. All-in sustaining costs per ounce of gold produced is presented on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). All-in sustaining costs per ounce of gold produced on a by-product basis is calculated as the aggregate of total cash costs per ounce of gold produced on a by-product basis and sustaining capital expenditures (including capitalized exploration), general and administrative expenses (including stock options) and non-cash reclamation provision expense per ounce of gold produced. All-in sustaining costs per ounce of gold produced on a co-product basis is calculated in the same manner as all-in sustaining costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made to total cash costs per ounce of gold produced. The calculation of all-in sustaining costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals.

        Prior to modifying its calculation of all-in sustaining costs per ounce of gold produced for 2014 based on the recommendations of the World Gold Council, the Company calculated all-in sustaining costs per ounce of gold produced on a by-product basis as the aggregate of total cash costs per ounce of gold produced on a by-product basis and sustaining capital expenditures, general and administrative expenses (net of stock options) and exploration and corporate development expenses (excluding greenfield exploration) per ounce of gold produced. All-in sustaining costs per ounce of gold produced on a co-product basis would have been calculated in the same manner as all-in sustaining costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues, net of smelting, refining and marketing charges would have been made to total cash costs per ounce of gold produced.

29



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

        The following table sets out a reconciliation of production costs to all-in sustaining costs per ounce of gold produced for the three and nine months ended September 30, 2015 and the three and nine months ended September 30, 2014 on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues).

Reconciliation of Production Costs to All-in Sustaining Costs per Ounce of Gold Produced

(United States dollars per ounce of gold produced, except where noted)
  Three Months Ended
September 30, 2015
  Three Months Ended
September 30, 2014
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 

Production costs per the condensed interim consolidated statements of income (loss) and comprehensive income (loss) (thousands of United States dollars)

  $ 254,584   $ 269,793   $ 765,476   $ 717,242  
                   

Adjusted gold production (ounces)(i)

    441,124     349,273     1,249,012     1,038,261  
                   

Production costs per ounce of adjusted gold production(i)

  $ 577   $ 772   $ 613   $ 691  

Adjustments:

                         

Inventory and other adjustments(ii)

    10     22     20     25  
                   

Total cash costs per ounce of gold produced (co-product basis)(iii)

  $ 587   $ 794   $ 633   $ 716  

By-product metal revenues

    (51 )   (78 )   (59 )   (89 )
                   

Total cash costs per ounce of gold produced (by-product basis)(iii)

  $ 536   $ 716   $ 574   $ 627  
                   

Adjustments:

                         

Sustaining capital expenditures (including capitalized exploration)

    163     267     172     227  

General and administrative expenses (including stock options)

    58     72     60     89  

Non-cash reclamation provision and other

    2     4     2     4  
                   

All-in sustaining costs per ounce of gold produced (by-product basis)

  $ 759   $ 1,059   $ 808   $ 947  
                   

By-product metal revenues

    51     78     59     89  
                   

All-in sustaining costs per ounce of gold produced (co-product basis)

  $ 810   $ 1,137   $ 867   $ 1,036  
                   

Notes:

(i)
The La India mine achieved commercial production on February 1, 2014. 3,492 ounces of payable gold production were excluded from the calculation of total cash costs per ounce of gold produced in the nine months ended September 30, 2014 as they were produced prior to the achievement of commercial production.

(ii)
Under the Company's revenue recognition policy, revenue is recognized on concentrates when legal title and risk is transferred. As total cash costs per ounce of gold produced are calculated on a production basis, an inventory adjustment is made to reflect the sales margin on the portion of concentrate production not yet recognized as revenue. Other adjustments include the addition of smelting, refining and marketing charges to production costs.

30



AGNICO EAGLE MINES LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS
(Prepared in Accordance with International Financial Reporting Standards)
For the Three and Nine Months Ended September 30, 2015

(iii)
Total cash costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data presented by other gold producers. Total cash costs per ounce of gold produced is presented on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for by-product metal revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. Accordingly, the calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. The Company believes that these generally accepted industry measures provide a realistic indication of operating performance and provide useful comparison points between periods. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates.

31



AGNICO EAGLE MINES LIMITED
SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS
(thousands of United States dollars, except where noted)

 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
 
  2015   2014   2015   2014  

Operating margin(i) by mine:

                         

Northern Business

                         

LaRonde mine

  $ 32,443   $ 14,696   $ 95,256   $ 86,523  

Lapa mine

    13,813     13,748     39,852     38,140  

Goldex mine

    20,681     17,237     55,459     40,045  

Meadowbank mine

    55,493     52,504     151,670     265,193  

Canadian Malartic mine(ii)

    44,293     33,224     123,748     36,892  

Kittila mine

    21,528     12,128     65,088     45,315  

Southern Business

                         

Pinos Altos mine

    37,217     28,837     116,407     101,318  

Creston Mascota deposit at Pinos Altos

    8,898     8,032     30,275     23,173  

La India mine(iii)

    19,845     13,189     59,269     39,835  
                   

Total operating margin(i)

    254,211     193,595     737,024     676,434  

Amortization of property, plant and mine development

    157,968     117,396     451,480     294,533  

Exploration, corporate and other

    110,258     69,884     221,937     195,051  
                   

Income (loss) before income and mining taxes

    (14,015 )   6,315     63,607     186,850  

Income and mining taxes (recovery) expense

    (15,309 )   21,365     23,487     82,597  
                   

Net income (loss) for the period

  $ 1,294   $ (15,050 ) $ 40,120   $ 104,253  
                   

Net income (loss) per share — basic (US$)

  $ 0.01   $ (0.07 ) $ 0.19   $ 0.55  

Net income (loss) per share — diluted (US$)

  $ 0.01   $ (0.10 ) $ 0.19   $ 0.53  

Cash flows:

                         

Cash provided by operating activities

  $ 143,687   $ 71,244   $ 475,491   $ 504,368  

Cash used in investing activities

  $ (100,365 ) $ (131,662 ) $ (258,733 ) $ (728,493 )

Cash provided by (used in) financing activities

  $ 7,396   $ (35,943 ) $ (180,300 ) $ 247,921  

Realized prices (US$):

                         

Gold (per ounce)

  $ 1,119   $ 1,249   $ 1,173   $ 1,284  

Silver (per ounce)

  $ 14.93   $ 17.72   $ 16.04   $ 19.33  

Zinc (per tonne)

  $ 1,909   $ 2,365   $ 1,973   $ 2,227  

Copper (per tonne)

  $ 4,538   $ 7,500   $ 5,193   $ 6,842  

Payable production(iv):

                         

Gold (ounces):

                         

Northern Business

                         

LaRonde mine

    71,860     37,490     194,760     145,336  

Lapa mine

    25,668     24,781     71,038     67,011  

Goldex mine

    32,068     27,611     87,780     70,970  

Meadowbank mine

    99,425     91,557     279,224     366,162  

Canadian Malartic mine(ii)

    76,603     64,761     212,937     76,639  

Kittila mine

    46,455     28,230     133,095     98,612  

Southern Business

                         

Pinos Altos mine

    47,725     41,155     148,478     130,350  

Creston Mascota deposit at Pinos Altos

    12,716     13,377     40,770     34,853  

La India mine(iii)

    28,604     20,311     80,930     51,820  
                   

Total gold (ounces)

    441,124     349,273     1,249,012     1,041,753  
                   

                         

32



AGNICO EAGLE MINES LIMITED
SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS
(thousands of United States dollars, except where noted)

 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
 
  2015   2014   2015   2014  

Silver (thousands of ounces):

                         

Northern Business

                         

LaRonde mine

    221     224     619     918  

Lapa mine

    1         3      

Meadowbank mine

    39     34     191     85  

Canadian Malartic mine(ii)

    76     66     217     76  

Kittila mine

    3     1     8     4  

Southern Business

                         

Pinos Altos mine

    606     425     1,744     1,307  

Creston Mascota deposit at Pinos Altos

    40     26     109     60  

La India mine(iii)

    67     44     208     111  
                   

Total Silver (thousands of ounces)

    1,053     820     3,099     2,561  
                   

Zinc (tonnes)

    739     2,230     2,502     8,083  

Copper (tonnes)

    1,306     989     3,606     3,601  

Payable metal sold:

                         

Gold (ounces):

                         

Northern Business

                         

LaRonde mine

    69,143     39,279     189,462     145,494  

Lapa mine

    23,331     22,422     67,599     64,035  

Goldex mine

    33,004     26,762     88,217     68,624  

Meadowbank mine

    100,440     98,604     282,090     364,282  

Canadian Malartic mine(ii)(v)

    72,651     60,093     199,433     76,470  

Kittila mine

    47,070     28,209     135,436     97,157  

Southern Business

                         

Pinos Altos mine

    49,327     41,143     145,162     131,011  

Creston Mascota deposit at Pinos Altos

    12,911     12,793     40,847     33,758  

La India mine(iii)

    28,983     19,265     79,684     48,922  
                   

Total gold (ounces)

    436,860     348,570     1,227,930     1,029,753  
                   

Silver (thousands of ounces):

                         

Northern Business

                         

LaRonde mine

    220     249     649     911  

Meadowbank mine

    36     32     193     84  

Canadian Malartic mine(ii)(v)

    53     57     186     72  

Kittila mine

    3     1     7     4  

Southern Business

                         

Pinos Altos mine

    620     430     1,682     1,367  

Creston Mascota deposit at Pinos Altos

    39     18     107     50  

La India mine(iii)

    66     42     205     102  
                   

Total Silver (thousands of ounces)

    1,037     829     3,029     2,590  
                   

Zinc (tonnes)

    650     3,936     2,650     8,067  

Copper (tonnes)

    1,302     988     3,605     3,604  

33



AGNICO EAGLE MINES LIMITED
SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS
(thousands of United States dollars, except where noted)

 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
 
  2015   2014   2015   2014  

Total cash costs per ounce of gold produced — co-product basis (US$)(vi):

                         

Northern Business

                         

LaRonde mine

  $ 701   $ 1,316   $ 795   $ 1,118  

Lapa mine

    522     606     582     689  

Goldex mine

    479     582     546     661  

Meadowbank mine

    604     783     657     566  

Canadian Malartic mine(ii)

    559     754     609     737  

Kittila mine

    640     952     697     862  

Southern Business

                         

Pinos Altos mine

    578     724     565     706  

Creston Mascota deposit at Pinos Altos

    478     589     467     620  

La India mine(iii)

    470     584     462     528  
                   

Weighted average total cash costs per ounce of gold produced

  $ 587   $ 794   $ 633   $ 716  
                   

Total cash costs per ounce of gold produced — by-product basis (US$)(vi):

                         

Northern Business

                         

LaRonde mine

  $ 558   $ 861   $ 620   $ 701  

Lapa mine

    522     606     581     689  

Goldex mine

    479     582     546     661  

Meadowbank mine

    598     777     646     561  

Canadian Malartic mine(ii)

    544     735     593     717  

Kittila mine

    639     951     696     861  

Southern Business

                         

Pinos Altos mine

    392     545     378     513  

Creston Mascota deposit at Pinos Altos

    436     556     425     587  

La India mine(iii)

    436     547     422     483  
                   

Weighted average total cash costs per ounce of gold produced

  $ 536   $ 716   $ 574   $ 627  
                   

Notes:

(i)
Operating margin is calculated as revenues from mining operations less production costs.

(ii)
On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of Osisko by way of the Arrangement. As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of Osisko (now Canadian Malartic Corporation) and Canadian Malartic GP, which now holds the Canadian Malartic mine. The information set out in this table reflects the Company's 50.0% interest in the Canadian Malartic mine since the date of acquisition.

(iii)
The La India mine achieved commercial production on February 1, 2014. 3,492 ounces of payable gold production were excluded from the calculation of total cash costs per ounce of gold produced in the nine months ended September 30, 2014 as they were produced prior to the achievement of commercial production.

(iv)
Payable production (a non-GAAP non-financial performance measure) is the quantity of mineral produced during a period contained in products that are or will be sold by the Company, whether such products are sold during the period or held as inventories at the end of the period.

34



AGNICO EAGLE MINES LIMITED
SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS
(thousands of United States dollars, except where noted)

(v)
The Canadian Malartic mine's payable metal sold excludes the 5.0% net smelter royalty transferred to Osisko Gold Royalties Ltd., pursuant to the Arrangement.

(vi)
Total cash costs per ounce of gold produced is not a recognized measure under IFRS and this data may not be comparable to data presented by other gold producers. Total cash costs per ounce of gold produced is presented on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the condensed interim consolidated statements of income (loss) and comprehensive income (loss) for by-product metal revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. Accordingly, the calculation of total cash costs per ounce of gold produced on a co-product basis does not reflect a reduction in production costs or smelting, refining and marketing charges associated with the production and sale of by-product metals. The Company believes that these generally accepted industry measures provide a realistic indication of operating performance and provide useful comparison points between periods. Total cash costs per ounce of gold produced is intended to provide information about the cash generating capabilities of the Company's mining operations. Management also uses these measures to monitor the performance of the Company's mining operations. As market prices for gold are quoted on a per ounce basis, using the total cash costs per ounce of gold produced on a by-product basis measure allows management to assess a mine's cash generating capabilities at various gold prices. Management is aware that these per ounce measures of performance can be affected by fluctuations in exchange rates and, in the case of total cash costs of gold produced on a by-product basis, by-product metal prices. Management compensates for these inherent limitations by using these measures in conjunction with minesite costs per tonne as well as other data prepared in accordance with IFRS. Management also performs sensitivity analyses in order to quantify the effects of fluctuating metal prices and exchange rates.

35



AGNICO EAGLE MINES LIMITED
SUMMARIZED QUARTERLY DATA
(thousands of United States dollars, except where noted)

 
  Three Months Ended  
 
  December 31,
2013
  March 31,
2014
  June 30,
2014
  September 30,
2014
  December 31,
2014
  March 31,
2015
  June 30,
2015
  September 30,
2015
 

Operating margin(i):

                                                 

Revenues from mining operations

  $ 437,240   $ 491,767   $ 438,521   $ 463,388   $ 503,090   $ 483,596   $ 510,109   $ 508,795  

Production costs

    230,495     218,066     229,383     269,793     287,317     247,280     263,612     254,584  
                                   

Total operating margin(i)

    206,745     273,701     209,138     193,595     215,773     236,316     246,497     254,211  

Operating margin(i) by mine:

                                                 

Northern Business

                                                 

LaRonde mine

    27,243     45,425     26,402     14,696     33,535     30,015     32,799     32,443  

Lapa mine

    18,143     15,340     9,050     13,748     16,060     14,687     11,351     13,813  

Goldex mine(ii)

    6,079     9,525     13,283     17,237     20,693     19,253     15,525     20,681  

Meadowbank mine

    80,818     123,961     88,728     52,504     39,839     46,577     49,600     55,493  

Canadian Malartic mine(iii)

            3,668     33,224     39,092     34,718     44,737     44,293  

Kittila mine

    27,949     19,003     14,184     12,128     14,312     27,415     16,145     21,528  

Southern Business

                                                 

Pinos Altos mine

    38,224     39,064     33,417     28,837     27,123     34,652     44,538     37,217  

Creston Mascota deposit at Pinos Altos

    8,289     7,714     7,428     8,032     8,392     8,409     12,968     8,898  

La India mine(iv)

        13,669     12,978     13,189     16,727     20,590     18,834     19,845  
                                   

Total operating margin(i)

    206,745     273,701     209,138     193,595     215,773     236,316     246,497     254,211  

Amortization of property, plant and mine development

    90,788     83,481     93,656     117,396     139,095     135,897     157,615     157,968  

Impairment loss

    1,014,688                              

Exploration, corporate and other

    61,644     43,502     81,665     69,884     74,390     43,706     67,973     110,258  
                                   

Income (loss) before income and mining taxes

    (960,375 )   146,718     33,817     6,315     2,288     56,713     20,909     (14,015 )

Income and mining taxes (recovery) expense

    (180,103 )   49,573     11,659     21,365     23,571     27,970     10,826     (15,309 )
                                   

Net income (loss) for the period

  $ (780,272 ) $ 97,145   $ 22,158   $ (15,050 ) $ (21,283 ) $ 28,743   $ 10,083   $ 1,294  
                                   

Net income (loss) per share — basic (US$)

  $ (4.49 ) $ 0.56   $ 0.12   $ (0.07 ) $ (0.10 ) $ 0.13   $ 0.05   $ 0.01  

Net income (loss) per share — diluted (US$)

  $ (4.49 ) $ 0.56   $ 0.12   $ (0.10 ) $ (0.12 ) $ 0.13   $ 0.05   $ 0.01  

Cash flows:

                                                 

Cash provided by operating activities

  $ 140,789   $ 250,396   $ 182,728   $ 71,244   $ 163,956   $ 143,455   $ 188,349   $ 143,687  

Cash used in investing activities

  $ (143,928 ) $ (108,288 ) $ (488,543 ) $ (131,662 ) $ (123,126 ) $ (53,892 ) $ (104,476 ) $ (100,365 )

Cash provided by (used in) financing activities

  $ 30,811   $ (98,087 ) $ 381,951   $ (35,943 ) $ (18,685 ) $ (123,182 ) $ (64,514 ) $ 7,396  

Notes:

(i)
Operating margin is calculated as revenues from mining operations less production costs.

(ii)
The Goldex mine's M and E Zones achieved commercial production on October 1, 2013.

(iii)
On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of Osisko by way of the Arrangement. As a result of the Arrangement, Agnico Eagle and Yamana each indirectly own 50.0% of Osisko (now Canadian Malartic Corporation) and Canadian Malartic GP, which now holds the Canadian Malartic mine. The information set out in this table reflects the Company's 50.0% interest in the Canadian Malartic mine since the date of acquisition.

(iv)
The La India mine achieved commercial production on February 1, 2014.

36



AGNICO EAGLE MINES LIMITED
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
(thousands of United States dollars, except share amounts)
(Unaudited)

 
  As at
September 30,
2015
  As at
December 31,
2014(i)
 

ASSETS

             

Current assets:

             

Cash and cash equivalents

  $ 201,964   $ 177,537  

Short-term investments

    6,144     4,621  

Restricted cash

    19,499     33,122  

Trade receivables (note 6)

    5,899     59,716  

Inventories (note 7)

    490,833     446,660  

Income taxes recoverable

    58,473     1,658  

Available-for-sale securities (notes 6 and 8)

    31,960     56,468  

Fair value of derivative financial instruments (notes 6 and 13)

    321     4,877  

Other current assets

    171,835     123,401  
           

Total current assets

    986,928     908,060  

Non-current assets:

             

Restricted cash

    765     20,899  

Goodwill (note 5)

    696,809     696,809  

Property, plant and mine development (note 9)

    5,082,342     5,155,865  

Other assets

    38,764     27,622  
           

Total assets

  $ 6,805,608   $ 6,809,255  
           

LIABILITIES AND EQUITY

             

Current liabilities:

             

Accounts payable and accrued liabilities

  $ 251,969   $ 209,906  

Reclamation provision

    8,349     6,769  

Interest payable

    21,135     13,816  

Income taxes payable

    9,495     19,328  

Finance lease obligations

    13,533     22,142  

Current portion of long-term debt (note 10)

    14,932     52,182  

Fair value of derivative financial instruments (notes 6 and 13)

    14,356     8,249  
           

Total current liabilities

    333,769     332,392  
           

Non-current liabilities:

             

Long-term debt (note 10)

    1,203,266     1,322,461  

Reclamation provision

    235,965     249,917  

Deferred income and mining tax liabilities

    838,572     797,192  

Other liabilities

    38,780     38,803  
           

Total liabilities

    2,650,352     2,740,765  
           

EQUITY

             

Common shares (note 11):

             

Outstanding — 217,647,221 common shares issued, less 233,525 shares held in trust

    4,695,297     4,599,788  

Stock options (notes 11 and 12)

    213,602     200,830  

Contributed surplus

    37,254     37,254  

Deficit

    (791,153 )   (779,382 )

Accumulated other comprehensive income

    256     10,000  
           

Total equity

    4,155,256     4,068,490  
           

Total liabilities and equity

  $ 6,805,608   $ 6,809,255  
           

Commitments and contingencies (note 15)

             

Note:

(i)
As set out in note 5, certain previously reported December 31, 2014 consolidated balance sheet line items have been updated to reflect adjusted final estimates of fair value related to the June 16, 2014 joint acquisition of Osisko.

See accompanying notes

37



AGNICO EAGLE MINES LIMITED
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND
COMPREHENSIVE INCOME (LOSS)
(thousands of United States dollars, except per share amounts)
(Unaudited)

 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
 
  2015   2014   2015   2014  

REVENUES

                         

Revenues from mining operations

  $ 508,795   $ 463,388   $ 1,502,500   $ 1,393,676  

COSTS, EXPENSES AND OTHER INCOME

                         

Production(i)

    254,584     269,793     765,476     717,242  

Exploration and corporate development

    37,085     20,521     84,352     41,566  

Amortization of property, plant and mine development

    157,968     117,396     451,480     294,533  

General and administrative

    25,675     24,991     74,468     92,776  

Impairment loss on available-for-sale securities (note 8)

    7,076     462     8,106     2,881  

Finance costs

    19,674     20,852     57,341     55,249  

Loss on derivative financial instruments (note 13)

    16,550     7,908     16,290     3,644  

Gain on sale of available-for-sale securities (note 8)

    (875 )   (83 )   (24,599 )   (5,372 )

Environmental remediation

    49     8,490     337     9,163  

Foreign currency translation loss (gain)

    902     (4,679 )   (6,009 )   (3,170 )

Other expenses (income)

    4,122     (8,578 )   11,651     (1,686 )
                   

Income (loss) before income and mining taxes

    (14,015 )   6,315     63,607     186,850  

Income and mining taxes (recovery) expense

    (15,309 )   21,365     23,487     82,597  
                   

Net income (loss) for the period

  $ 1,294   $ (15,050 ) $ 40,120   $ 104,253  
                   

Net income (loss) per share — basic (note 11)

  $ 0.01   $ (0.07 ) $ 0.19   $ 0.55  
                   

Net income (loss) per share — diluted (note 11)

  $ 0.01   $ (0.10 ) $ 0.19   $ 0.53  
                   

Cash dividends declared per common share

  $ 0.08   $ 0.08   $ 0.24   $ 0.24  
                   

COMPREHENSIVE INCOME (LOSS)

                         

Net income (loss) for the period

  $ 1,294   $ (15,050 ) $ 40,120   $ 104,253  
                   

Other comprehensive income (loss):

                         

Items that may be subsequently reclassified to net income (loss):

                         

Available-for-sale securities and other investments:

                         

Unrealized change in fair value of available-for-sale securities

    (9,334 )   (19,513 )   5,259     6,769  

Reclassification to impairment loss on available-for-sale securities (note 8)

    7,076     462     8,106     2,881  

Reclassification to gain on sale of available-for-sale securities (note 8)

    (875 )   (83 )   (24,599 )   (5,372 )

Income tax impact of reclassification items

    (828 )       2,208      

Income tax impact of other comprehensive income (loss) items

    1,247         (718 )    
                   

    (2,714 )   (19,134 )   (9,744 )   4,278  
                   

Items that will not be subsequently reclassified to net income (loss):

                   

Pension benefit obligations:

                         

Remeasurement losses of pension benefit obligations

    (195 )       (610 )    

Income tax impact

    52         161      
                   

    (143 )       (449 )    
                   

Other comprehensive income (loss) for the period

    (2,857 )   (19,134 )   (10,193 )   4,278  
                   

Comprehensive income (loss) for the period

  $ (1,563 ) $ (34,184 ) $ 29,927   $ 108,531  
                   

Note:

(i)
Exclusive of amortization, which is shown separately.

See accompanying notes

38



AGNICO EAGLE MINES LIMITED
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF EQUITY
(thousands of United States dollars, except share and per share amounts)
(Unaudited)

 
  Common Shares
Oustanding
   
   
   
   
   
 
 
   
   
   
  Accumulated
Other
Comprehensive
Income
   
 
 
  Stock
Options
  Contributed
Surplus
   
  Total
Equity
 
 
  Shares   Amount   Deficit  

Balance December 31, 2013

    173,953,975   $ 3,294,007   $ 184,078   $ 37,254   $ (800,074 ) $ 2,141   $ 2,717,406  
                               

Net income

                    104,253         104,253  

Other comprehensive income

                        4,278     4,278  
                               

Total comprehensive income

                    104,253     4,278     108,531  
                               

Transactions with owners:

                                           

Shares issued under employee stock option plan (notes 11 and 12)

    582,925     21,083     (4,262 )               16,821  

Stock options (notes 11 and 12)

            17,475                 17,475  

Shares issued under incentive share purchase plan (note 12)

    367,802     11,935                     11,935  

Shares issued under dividend reinvestment plan

    164,227     5,289                     5,289  

Shares issued for joint acquisition of Osisko (note 5)

    34,794,892     1,164,237                     1,164,237  

Common shares held by a depository relating to Convertible Debentures previously issued by Osisko (notes 5 and 10)

    (871,680 )   (29,166 )                   (29,166 )

Dividends declared ($0.24 per share)

                    (44,624 )       (44,624 )

Restricted share unit ("RSU") plan (note 12)

    38,482     1,864                     1,864  
                               

Balance September 30, 2014

    209,030,623   $ 4,469,249   $ 197,291   $ 37,254   $ (740,445 ) $ 6,419   $ 3,969,768  
                               

Balance December 31, 2014

   
214,236,234
 
$

4,599,788
 
$

200,830
 
$

37,254
 
$

(779,382

)

$

10,000
 
$

4,068,490
 
                               

Net income

                    40,120         40,120  

Other comprehensive loss

                    (449 )   (9,744 )   (10,193 )
                               

Total comprehensive income (loss)

                    39,671     (9,744 )   29,927  
                               

Transactions with owners:

                                           

Shares issued under employee stock option plan (notes 11 and 12)

    579,358     17,631     (3,621 )               14,010  

Stock options (notes 11 and 12)

            16,393                 16,393  

Shares issued under incentive share purchase plan (note 12)

    392,635     10,843                     10,843  

Shares issued under dividend reinvestment plan

    252,715     6,918                     6,918  

Shares issued for joint acquisition of Malartic CHL property

    459,197     13,441                     13,441  

Shares issued for acquisition of Soltoro Ltd. (note 5)

    770,429     24,351                     24,351  

Shares issued to settle Convertible Debentures previously issued by Osisko (note 10)

    871,680     24,779                     24,779  

Dividends declared ($0.24 per share)

                    (51,442 )       (51,442 )

Restricted share unit plan and long term incentive plan ("LTIP") (note 12)

    (148,552 )   (2,454 )                   (2,454 )
                               

Balance September 30, 2015

    217,413,696   $ 4,695,297   $ 213,602   $ 37,254   $ (791,153 ) $ 256   $ 4,155,256  
                               

See accompanying notes

39



AGNICO EAGLE MINES LIMITED
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(thousands of United States dollars)
(Unaudited)

 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
 
  2015   2014   2015   2014  

OPERATING ACTIVITIES

                         

Net income (loss) for the period

  $ 1,294   $ (15,050 ) $ 40,120   $ 104,253  

Add (deduct) items not affecting cash:

                         

Amortization of property, plant and mine development

    157,968     117,396     451,480     294,533  

Deferred income and mining taxes

    37,783     6,982     43,403     26,189  

Gain on sale of available-for-sale securities (note 8)

    (875 )   (83 )   (24,599 )   (5,372 )

Stock-based compensation (note 12)

    8,928     7,552     28,777     30,032  

Impairment loss on available-for-sale securities (note 8)

    7,076     462     8,106     2,881  

Foreign currency translation loss (gain)

    902     (4,679 )   (6,009 )   (3,170 )

Other

    4,874     19,065     7,007     26,971  

Adjustment for settlement of reclamation provision

    (143 )   (2,456 )   (852 )   (3,491 )

Changes in non-cash working capital balances:

                         

Trade receivables

    55,296     6,972     53,834     15,225  

Income taxes

    (55,628 )   4,468     (66,648 )   24,988  

Inventories

    (71,510 )   (54,962 )   (49,475 )   (25,059 )

Other current assets

    (25,761 )   4,490     (48,784 )   (315 )

Accounts payable and accrued liabilities

    15,959     (26,046 )   31,812     9,710  

Interest payable

    7,524     7,133     7,319     6,993  
                   

Cash provided by operating activities

    143,687     71,244     475,491     504,368  
                   

INVESTING ACTIVITIES

                         

Additions to property, plant and mine development (note 9)

    (122,402 )   (125,442 )   (316,800 )   (342,059 )

Acquisitions, net of cash and cash equivalents acquired (note 5)

            (12,983 )   (403,509 )

Net purchases of short-term investments

    (475 )   (2,600 )   (1,523 )   (4,604 )

Net proceeds from sale of available-for-sale securities and warrants (note 8)

    4,724     493     61,035     40,635  

Purchase of available-for-sale securities and warrants (note 8)

        (13,861 )   (19,433 )   (27,246 )

Decrease in restricted cash

    17,788     9,748     30,971     8,290  
                   

Cash used in investing activities

    (100,365 )   (131,662 )   (258,733 )   (728,493 )
                   

FINANCING ACTIVITIES

                         

Dividends paid

    (15,374 )   (14,546 )   (44,572 )   (39,459 )

Repayment of finance lease obligations

    (4,091 )   (7,672 )   (17,535 )   (14,366 )

Sale-leaseback financing

                1,027  

Proceeds from long-term debt (note 10)

    250,000     230,000     325,000     960,000  

Repayment of long-term debt (note 10)

    (275,000 )   (250,707 )   (501,086 )   (674,640 )

Note issuance (note 10)

    50,000         50,000      

Long-term debt financing

    (1,493 )   (2,127 )   (1,493 )   (2,127 )

Repurchase of common shares for restricted share unit plan (note 12)

            (11,899 )   (7,518 )

Proceeds on exercise of stock options (note 12)

    1,052     6,538     14,010     16,994  

Common shares issued

    2,302     2,571     7,275     8,010  
                   

Cash provided by (used in) financing activities

    7,396     (35,943 )   (180,300 )   247,921  
                   

Effect of exchange rate changes on cash and cash equivalents

    (7,085 )   (4,385 )   (12,031 )   (4,074 )
                   

Net increase (decrease) in cash and cash equivalents during the period

    43,633     (100,746 )   24,427     19,722  

Cash and cash equivalents, beginning of period

    158,331     259,569     177,537     139,101  
                   

Cash and cash equivalents, end of period

  $ 201,964   $ 158,823   $ 201,964   $ 158,823  
                   

SUPPLEMENTAL CASH FLOW INFORMATION

                         

Interest paid

  $ 10,358   $ 13,513   $ 46,256   $ 43,969  
                   

Income and mining taxes paid

  $ 9,258   $ 16,911   $ 47,356   $ 38,232  
                   

See accompanying notes

40



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

1.     CORPORATE INFORMATION

    Agnico Eagle Mines Limited ("Agnico Eagle" or the "Company") is principally engaged in the production and sale of gold, as well as related activities such as exploration and mine development. The Company's mining operations are located in Canada, Mexico and Finland and it has exploration activities in Canada, Europe, Latin America and the United States. Agnico Eagle is a public company incorporated and domiciled in Canada with its head and registered office located at 145 King Street East, Suite 400, Toronto, Ontario, M5C 2Y7. The Company is listed on the Toronto Stock Exchange and the New York Stock Exchange. Agnico Eagle sells its gold production into the world market.

    These condensed interim consolidated financial statements were authorized for issuance by the Board of Directors on October 30, 2015.

2.     BASIS OF PRESENTATION

    A)
    Statement of Compliance

      The accompanying condensed interim consolidated financial statements of Agnico Eagle have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting ("IAS 34") as issued by the International Accounting Standards Board ("IASB") in United States ("US") dollars. These condensed interim consolidated financial statements do not include all of the disclosures required by International Financial Reporting Standards ("IFRS") for annual audited consolidated financial statements.

      These condensed interim consolidated financial statements were prepared on a going concern basis under the historical cost method except for certain financial assets and liabilities which are measured at fair value.

      These condensed interim consolidated financial statements should be read in conjunction with the Company's 2014 annual audited consolidated financial statements, including the accounting policies and notes thereto, included in the Annual Report and Annual Information Form/Form 40-F for the year ended December 31, 2014, which were prepared in accordance with IFRS.

      In the opinion of management, these condensed interim consolidated financial statements reflect all adjustments, which consist of normal and recurring adjustments necessary to present fairly the financial position as at September 30, 2015 and December 31, 2014 and the results of operations and cash flows for the three and nine months ended September 30, 2015 and September 30, 2014.

      Operating results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2015.

    B)
    Basis of Presentation

      Subsidiaries

      These condensed interim consolidated financial statements include the accounts of Agnico Eagle and its consolidated subsidiaries. All intercompany balances, transactions, income and expenses and gains or losses have been eliminated on consolidation. Subsidiaries are consolidated where Agnico Eagle has the ability to exercise control. Control of an investee exists when Agnico Eagle is exposed to variable returns from the Company's involvement with the investee and has the ability to affect those returns through its power over the investee. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the elements of control.

      Joint Arrangements

      A joint arrangement is defined as an arrangement in which two or more parties have joint control. Joint control is the contractually agreed sharing of control over an arrangement between two or more parties. This exists only when the decisions about the relevant activities that significantly affect the returns of the arrangement require the unanimous consent of the parties sharing control.

      A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement and have rights to the assets and obligations for the liabilities relating to the arrangement. These condensed interim consolidated financial statements include the Company's interest in the assets, liabilities, revenues and expenses of its joint operations, from the date that joint control commenced. Agnico Eagle's interest in the Canadian Malartic Corporation, located in Quebec, has been accounted for as a joint operation.

3.     ACCOUNTING POLICIES

    These condensed interim consolidated financial statements follow the same accounting policies and methods of their application as the December 31, 2014 annual audited consolidated financial statements.

41



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

4.     SIGNIFICANT JUDGMENTS, ESTIMATES AND ASSUMPTIONS

    The preparation of these condensed interim consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the amounts reported in the condensed interim consolidated financial statements and accompanying notes. Management believes that the estimates used in the preparation of the condensed interim consolidated financial statements are reasonable; however, actual results may differ materially from these estimates. The areas involving significant judgments, estimates and assumptions have been detailed in note 4 to the Company's annual audited consolidated financial statements for the year ended December 31, 2014.

5.     ACQUISITIONS

    Soltoro Ltd.

    On June 9, 2015, the Company acquired all of the issued and outstanding common shares of Soltoro Ltd. ("Soltoro"), including common shares issuable on the exercise of Soltoro's outstanding options and warrants, by way of a plan of arrangement under the Canada Business Corporations Act (the "Soltoro Arrangement"). Soltoro is an exploration company focused on the discovery of precious metals in Mexico.

    Each outstanding share of Soltoro was exchanged under the Soltoro Arrangement for: (i) C$0.01 in cash; (ii) 0.00793 of an Agnico Eagle common share; and (iii) 1 common share of Palamina Corp., a company that was newly formed in connection with the Soltoro Arrangement.

    Pursuant to the Soltoro Arrangement, Soltoro transferred all mining properties located outside of the state of Jalisco, Mexico to Palamina Corp., while Soltoro retained all mining properties located within the state of Jalisco, Mexico. Agnico Eagle had no interest in Palamina Corp. upon the closing of the Soltoro Arrangement.

    Agnico Eagle's total purchase price of $26.7 million was comprised of $2.4 million in cash, including $1.6 million in cash contributed to Palamina Corp., and 770,429 Agnico Eagle common shares issued from treasury. The Soltoro acquisition was accounted for as an asset acquisition and transaction costs associated with the acquisition totaling $1.4 million were capitalized to the mining properties acquired separately from the purchase price allocation set out below.

    The following table sets out the allocation of the purchase price to assets acquired and liabilities assumed, based on management's estimates of fair value:

 

Total purchase price:

       
 

Cash paid for acquisition

  $ 2,366  
 

Agnico Eagle common shares issued for acquisition

    24,351  
         
 

Total purchase price to allocate

  $ 26,717  
         
 

Fair value of assets acquired and liabilities assumed:

       
 

Mining properties

  $ 27,053  
 

Cash and cash equivalents

    2,375  
 

Available-for-sale securities

    17  
 

Other current assets

    130  
 

Plant and equipment

    33  
 

Accounts payable and accrued liabilities

    (1,134 )
 

Other current liabilities

    (1,757 )
         
 

Net assets acquired

  $ 26,717  
         

    Gunnarn Mining AB

    On June 11, 2015, the Company acquired 55.0% of the issued and outstanding common shares of Gunnarn Mining AB ("Gunnarn") from Orex Minerals Inc. ("Orex"), by way of a share purchase agreement and joint venture agreement (the "Gunnarn Agreements"). Gunnarn holds a 100.0% interest in the Barsele project located in northern Sweden.

    Agnico Eagle's total purchase price of $13.1 million was comprised of $6.0 million in cash and $7.1 million in accrued consideration. Pursuant to the Gunnarn Agreements, the $7.1 million in accrued consideration includes two $2.0 million payments to be made by the Company to Orex in cash or Agnico Eagle common shares at Agnico Eagle's sole discretion on June 11, 2016 and June 11, 2017,

42



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

5.     ACQUISITIONS (Continued)

    respectively. Agnico Eagle also committed to $7.0 million in exploration expenditures associated with the Barsele project by June 11, 2018 and may earn an additional 15.0% interest in Gunnarn if the Company completes a pre-feasibility study related to the Barsele project. Orex was granted a 2.0% net smelter royalty on production from the Barsele project which may be repurchased by Agnico Eagle at any time for $5.0 million.

    Under the Gunnarn Agreements, Agnico Eagle holds a majority of the seats on the board of directors of Gunnarn and is the sole operator of the Barsele project in exchange for customary management fees.

    The Gunnarn acquisition was accounted for as an asset acquisition and transaction costs associated with the acquisition totaling $0.6 million were capitalized to the mining properties acquired separately from the purchase allocation set out below.

    The following table sets out the allocation of the purchase price to assets acquired and liabilities assumed, based on management's estimates of fair value:

 

Total purchase price:

       
 

Cash paid for acquisition

  $ 5,994  
 

Accrued consideration

    7,150  
         
 

Total purchase price to allocate

  $ 13,144  
         
 

Fair value of assets acquired and liabilities assumed:

       
 

Mining properties

  $ 20,021  
 

Cash and cash equivalents

    3  
 

Other current assets

    35  
 

Accounts payable and accrued liabilities

    (80 )
 

Long-term debt

    (29 )
 

Other liabilities

    (6,806 )
         
 

Net assets acquired

  $ 13,144  
         

    Osisko Mining Corporation

    On June 16, 2014, Agnico Eagle and Yamana jointly acquired 100.0% of the issued and outstanding shares of Osisko by way of the Arrangement. Under the Arrangement, Agnico Eagle and Yamana each indirectly acquired 50.0% of Osisko's issued and outstanding shares. As part of the Arrangement, the Canadian Malartic mine in Quebec was transferred to the newly formed Canadian Malartic GP in which each of Agnico Eagle and Yamana have an indirect 50.0% interest. Agnico Eagle and Yamana will also jointly explore the Kirkland Lake assets, the Hammond Reef project and the Pandora and Wood-Pandora properties through their indirect joint ownership of Canadian Malartic Corporation (the successor to Osisko). Together, the acquired properties constitute the Canadian Malartic joint operation segment (see note 14 to these condensed interim consolidated financial statements for details).

    Each outstanding share of Osisko was exchanged under the Arrangement for: (i) C$2.09 in cash (Agnico Eagle's 50.0% share was C$1.045); (ii) 0.07264 of an Agnico Eagle common share (a value of C$2.64 based on the closing price of C$36.29 for Agnico Eagle common shares on the Toronto Stock Exchange as of June 16, 2014); (iii) 0.26471 of a Yamana common share; and (iv) 0.1 of one common share of Osisko Gold Royalties Ltd., a company that was newly formed in connection with the Arrangement and is now traded on the Toronto Stock Exchange.

    Pursuant to the Arrangement, the following assets of Osisko were transferred to Osisko Gold Royalties Ltd.: (i) a 5.0% net smelter royalty on the Canadian Malartic mine; (ii) C$157.0 million in cash; (iii) a 2.0% net smelter royalty on the Kirkland Lake assets, the Hammond Reef project, and certain other exploration properties retained by Canadian Malartic Corporation; (iv) all assets and liabilities of Osisko in its Guerrero camp in Mexico; and (v) certain other investments and assets.

    Agnico Eagle has recognized its interest in the assets, liabilities, revenues and expenses of Osisko in accordance with the Company's rights and obligations prescribed by the Arrangement, as the joint arrangement was determined to be a joint operation under IFRS.

    Agnico Eagle's transaction costs associated with the acquisition totaling $16.7 million were expensed through the general and administrative line item of the annual audited consolidated statements of income (loss) and comprehensive income (loss) for the year ended December 31, 2014.

43



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

5.     ACQUISITIONS (Continued)

    Agnico Eagle's share of the June 16, 2014 purchase price of Osisko was comprised of the following:

 

Cash paid for acquisition

  $ 462,728  
 

Agnico Eagle common shares issued for acquisition

    1,135,071  
         
 

Total Agnico Eagle purchase price to allocate

  $ 1,597,799  
         

    A fair value approach was applied by management in developing estimates of the fair value of identifiable assets and liabilities contributed to the newly formed Osisko joint operation. These estimates of fair value have now been finalized as all relevant information about facts and circumstances that existed at the acquisition date have been received.

    Certain previously reported Agnico Eagle consolidated balance sheet line items as at December 31, 2014 were updated to reflect adjusted final estimates of the fair value of identifiable assets acquired and liabilities assumed related to the June 16, 2014 joint acquisition of Osisko. As a result of new information obtained about the facts and circumstances that existed as of the Osisko acquisition date, the following adjustments were recorded to both the adjusted final purchase price allocation and the December 31, 2014 balance sheet as previously reported: the property, plant and mine development line item decreased by $145.6 million; the goodwill line item (not deductible for tax purposes) increased by $114.3 million; the accounts payable and accrued liabilities line item increased by $3.7 million and the deferred income and mining tax liabilities line item decreased by $35.0 million.

    The following table sets out the allocation of Agnico Eagle's share of the purchase price to attributable assets acquired and liabilities assumed pursuant to the Arrangement, based on management's previously reported preliminary estimates of fair value and adjusted final estimates of fair value:

    Fair value of assets acquired and liabilities assumed:

   
  Preliminary(i)   Adjustments   Adjusted Final  
 

Property, plant and mine development

  $ 1,452,148   $ (145,631 ) $ 1,306,517  
 

Goodwill(ii)

    543,444     114,348     657,792  
 

Cash and cash equivalents

    59,219         59,219  
 

Restricted cash

    35,528         35,528  
 

Trade receivables(iii)

    9,653         9,653  
 

Inventories

    51,477         51,477  
 

Other current assets

    11,420         11,420  
 

Accounts payable and accrued liabilities

    (49,391 )   (3,726 )   (53,117 )
 

Reclamation provision

    (20,776 )       (20,776 )
 

Long-term debt

    (151,333 )       (151,333 )
 

Deferred income and mining tax liabilities

    (343,590 )   35,009     (308,581 )
                 
 

Net assets acquired

  $ 1,597,799   $   $ 1,597,799  
                 

    Notes:

    (i)
    Preliminary estimates of the fair value of assets acquired and liabilities assumed are presented as reported in the Company's 2014 annual audited consolidated financial statements.

    (ii)
    Goodwill is not deductible for tax purposes and is allocated to the Canadian Malartic joint operation segment.

    (iii)
    The fair value of trade receivables approximates the gross contractual amounts receivable.

44



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

5.     ACQUISITIONS (Continued)

    The joint acquisition of Osisko is a strategic fit with the Company's skill set and its other operating assets in the area. The Company believes that goodwill associated with the joint acquisition of Osisko arose principally because of the following factors: (1) the value implicit in the Company's ability to sustain and/or grow its business by increasing proven and probable mineral reserves and mineral resources through new discoveries; and (2) the requirement to record a deferred tax liability for the difference between the assigned values and the tax bases of assets acquired and liabilities assumed in a business combination at amounts that do not reflect fair value. The amount of goodwill associated with the joint acquisition of Osisko that is expected to be deductible for tax purposes is nil. Upon finalization of management's estimates of the fair value of identifiable assets and liabilities, the Company conducted a retrospective goodwill impairment test as at December 31, 2014 based on the adjusted final value of goodwill, with no impairment losses required.

    The Company's indirect 50.0% interest in Canadian Malartic GP resulted in revenues from mining operations of $189.9 million and a net loss of $15.8 million between the June 16, 2014 completion of the Arrangement and December 31, 2014.

6.     FAIR VALUE MEASUREMENT

    Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. All assets and liabilities for which fair value is measured or disclosed in the condensed interim consolidated financial statements are categorized within the fair value hierarchy, described, as follows, based on the lowest-level input that is significant to the fair value measurement as a whole:

      Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

      Level 2 — Quoted prices in markets that are not active or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and

      Level 3 — Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

    The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs.

    For items that are recognized at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing their classification at the end of each reporting period.

    During the nine months ended September 30, 2015, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into or out of Level 3 fair value measurements.

    The Company's financial assets and liabilities include cash and cash equivalents, short-term investments, restricted cash, trade receivables, available-for-sale securities, accounts payable and accrued liabilities, long-term debt and derivative financial instruments.

    The fair values of cash and cash equivalents, short-term investments, restricted cash and accounts payable and accrued liabilities approximate their carrying values due to their short-term nature.

    Long-term debt is recorded on the condensed interim consolidated balance sheet at September 30, 2015 at amortized cost. The fair value of long-term debt is determined by applying a discount rate, reflecting the credit spread based on the Company's credit rating, to future related cash flows. As at September 30, 2015, the Company's long-term debt had a fair value of $1,330.5 million (December 31, 2014 — $1,498.4 million).

45



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

6.     FAIR VALUE MEASUREMENT (Continued)

    The following table sets out the Company's financial assets and liabilities measured at fair value on a recurring basis as at September 30, 2015 using the fair value hierarchy:

   
  Level 1   Level 2   Level 3   Total  
 

Financial assets:

                         
 

Trade receivables

  $   $ 5,899   $   $ 5,899  
 

Available-for-sale securities

    27,509     4,451         31,960  
 

Fair value of derivative financial instruments

        321         321  
                     
 

Total financial assets

  $ 27,509   $ 10,671   $   $ 38,180  
                     
 

Financial liabilities:

                         
 

Fair value of derivative financial instruments

  $   $ 14,356   $   $ 14,356  
                     
 

Total financial liabilities

  $   $ 14,356   $   $ 14,356  
                     

    The following table sets out the Company's financial assets and liabilities measured at fair value on a recurring basis as at December 31, 2014 using the fair value hierarchy:

   
  Level 1   Level 2   Level 3   Total  
 

Financial assets:

                         
 

Trade receivables

  $   $ 59,716   $   $ 59,716  
 

Available-for-sale securities

    51,653     4,815         56,468  
 

Fair value of derivative financial instruments

        4,877         4,877  
                     
 

Total financial assets

  $ 51,653   $ 69,408   $   $ 121,061  
                     
 

Financial liabilities:

                         
 

Convertible Debentures

  $   $   $ 34,678   $ 34,678  
 

Fair value of derivative financial instruments

        8,249         8,249  
                     
 

Total financial liabilities

  $   $ 8,249   $ 34,678   $ 42,927  
                     

    Valuation Techniques

    Trade Receivables

    Trade receivables from provisional invoices for concentrate sales are valued using quoted forward rates derived from observable market data based on the month of expected settlement (classified within Level 2 of the fair value hierarchy).

    Available-for-sale Securities

    Available-for-sale securities representing shares of publicly traded entities are recorded at fair value using quoted market prices (classified within Level 1 of the fair value hierarchy). Available-for-sale securities representing shares of non-publicly traded entities are recorded at fair value using external broker-dealer quotations (classified within Level 2 of the fair value hierarchy).

    Derivative Financial Instruments

    Derivative financial instruments classified within Level 2 of the fair value hierarchy are recorded at fair value using external broker-dealer quotations or option pricing models that utilize a variety of inputs that are a combination of quoted prices and market-corroborated inputs. Derivative financial instruments are classified as at fair value through the consolidated statements of income (loss).

46



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

6.     FAIR VALUE MEASUREMENT (Continued)

    Convertible Debentures

    On June 30, 2015, the negotiated early settlement of all of the convertible debentures was completed. Convertible debentures issued by Osisko and subsequently an obligation of Canadian Malartic GP were reported at fair value and classified within Level 3 of the fair value hierarchy and constituted contracts which resulted in the payment of cash and the issuance of publicly-traded shares. Fair value was calculated with consideration given to the influence of a variety of inputs including quoted market prices and interest rates. Convertible debentures were included in the current portion of long-term debt line item of the condensed interim consolidated balance sheets prior to settlement.

7.     INVENTORIES

    During the three and nine months ended September 30, 2015, impairment losses of $2.3 million and $3.7 million, respectively, (twelve months ended December 31, 2014 — $4.6 million) were recorded within the production costs line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss) to reduce the carrying value of inventories to their net realizable value.

8.     AVAILABLE-FOR-SALE SECURITIES

    During the three months ended September 30, 2015, the Company did not purchase any available-for-sale securities. During the three months ended September 30, 2014, the Company purchased certain available-for-sale securities totaling $13.2 million. During the nine months ended September 30, 2015, the Company purchased certain available-for-sale securities totaling $19.4 million (nine months ended September 30, 2014 — $23.8 million).

    During the three months ended September 30, 2015, the Company received net proceeds of $4.7 million (three months ended September 30, 2014 — $0.5 million) and recognized a gain before income taxes of $0.9 million (three months ended September 30, 2014 — $0.1 million) on the sale of certain available-for-sale securities. During the nine months ended September 30, 2015, the Company received net proceeds of $54.4 million (nine months ended September 30, 2014 — $40.6 million) and recognized a gain before income taxes of $24.6 million (nine months ended September 30, 2014 — $5.4 million) on the sale of certain available-for-sale securities.

    During the three months ended September 30, 2015, the Company recorded an impairment loss of $7.1 million (three months ended September 30, 2014 — $0.5 million) on certain available-for-sale securities that were determined to have an impairment that was significant or prolonged. During the nine months ended September 30, 2015, the Company recorded an impairment loss of $8.1 million (nine months ended September 30, 2014 — $2.9 million) on certain available-for-sale securities that were determined to have an impairment that was significant or prolonged.

9.     PROPERTY, PLANT AND MINE DEVELOPMENT

    Acquisitions and disposals

    During the nine months ended September 30, 2015, $343.9 million of additions (nine months ended September 30, 2014 — $368.2 million) were capitalized to property, plant and mine development, excluding amounts capitalized related to acquisitions.

    During the nine months ended September 30, 2015, the Company capitalized assets with a cost of $49.1 million (nine months ended September 30, 2014 — $1,318.6 million) related to acquisitions (see note 5 to these condensed interim consolidated financial statements for details).

    Total borrowing costs capitalized to property, plant and mine development during the nine months ended September 30, 2015 were approximately $1.1 million (twelve months ended December 31, 2014 — $1.7 million) at a capitalization rate of 1.18% (twelve months ended December 31, 2014 — 1.28%).

    Assets with a net book value of $5.0 million were disposed of by the Company during the nine months ended September 30, 2015 (twelve months ended December 31, 2014 — $8.7 million), resulting in a net loss on disposal of $2.4 million (twelve months ended December 31, 2014 — $6.5 million).

    See note 15 to these condensed interim consolidated financial statements for capital commitments.

47



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

10.   LONG-TERM DEBT

    Credit Facility and Loan Repayments

    On September 30, 2015, the Company amended its $1.2 billion Credit Facility, extending the maturity date from June 22, 2019 to June 22, 2020 and amending pricing terms. At September 30, 2015, the Credit Facility was drawn down by $350.0 million (December 31, 2014 — $500.0 million). Amounts drawn down, together with outstanding letters of credit under the Credit Facility, resulted in Credit Facility availability of $849.0 million at September 30, 2015. During the nine months ended September 30, 2015, Credit Facility drawdowns totaled $325.0 million and repayments totaled $475.0 million.

    In connection with its joint acquisition of Osisko on June 16, 2014, Canadian Malartic GP was assigned and assumed certain outstanding debt obligations of Osisko relating to the Canadian Malartic mine. Agnico Eagle's indirect attributable interest in such debt obligations included a secured loan facility. A scheduled repayment of C$20.0 million ($16.0 million) was made on June 30, 2015, resulting in attributable outstanding principal of C$40.0 million ($29.9 million) as at September 30, 2015.

    2015 Note

    On September 30, 2015, the Company closed a private placement consisting of a $50.0 million guaranteed senior unsecured note (the "2015 Note") with a September 30, 2025 maturity date and a yield of 4.15%. An amount equal to or greater than the net proceeds from the 2015 Note are to be applied toward mining projects in the Province of Quebec, Canada.

    Consistent with the Company's previously existing debt arrangements, the 2015 Note requires the Company to maintain a total net debt to EBITDA ratio below a specified maximum value and to maintain a minimum tangible net worth.

    Convertible Debentures

    In connection with its joint acquisition of Osisko on June 16, 2014, Canadian Malartic GP was assigned and assumed certain outstanding debt obligations of Osisko relating to the Canadian Malartic mine. Agnico Eagle's indirect attributable interest in such debt instruments included Convertible Debentures with principal outstanding of C$37.5 million ($34.6 million), a November 2017 maturity date and a 6.875% interest rate.

    On June 30, 2015, the negotiated early settlement of all of the Convertible Debentures was completed. As a result of this settlement, 871,680 Agnico Eagle common shares with a fair value of $24.8 million were released from a depositary to the holders of the Convertible Debentures along with a cash payment of $10.1 million to settle the Company's obligation. In the nine months ended September 30, 2015 a $2.4 million mark-to-market loss was recorded in the other expenses (income) line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss) related to the Convertible Debentures. In the three and nine months ended September 30, 2014, mark-to-market gains of $7.0 million and $3.1 million were recorded related to the Convertible Debentures, respectively. Additional cash consideration of $3.2 million was paid to the holders of the Convertible Debentures upon settlement and was recorded in the other expenses (income) line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss). As at September 30, 2015, the Convertible Debentures had principal outstanding of nil.

48



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

11.   EQUITY

    Net Income (Loss) Per Share

    The following table sets out the weighted average number of common shares used in the calculation of basic and diluted net income (loss) per share:

   
  Three Months
Ended September 30,
  Nine Months
Ended September 30,
 
   
  2015   2014   2015   2014  
 

Net income (loss) for the period — basic

  $ 1,294   $ (15,050 ) $ 40,120   $ 104,253  
 

Less: Dilutive impact of Convertible Debentures(i)

        (6,522 )       (2,602 )
                     
 

Net income (loss) for the period — diluted

  $ 1,294   $ (21,572 ) $ 40,120   $ 101,651  
                     
 

Weighted average number of common shares outstanding — basic (in thousands)

    217,182     208,815     215,728     189,498  
 

Add: Dilutive impact of common shares held by a depositary relating to Convertible Debentures(i)

        872         342  
 

Add: Dilutive impact of common shares related to the RSU plan and LTIP

    289         298     300  
 

Add: Dilutive impact of employee stock options

    241         601     341  
                     
 

Weighted average number of common shares outstanding — diluted (in thousands)

    217,712     209,687     216,627     190,481  
                     
 

Net income (loss) per share — basic

  $ 0.01   $ (0.07 ) $ 0.19   $ 0.55  
                     
 

Net income (loss) per share — diluted

  $ 0.01   $ (0.10 ) $ 0.19   $ 0.53  
                     

    Note:

    (i)
    In connection with the joint acquisition of Osisko Mining Corporation on June 16, 2014, Agnico Eagle indirectly assumed its attributable interest in senior unsecured convertible debentures (the "Convertible Debentures"). On June 30, 2015, the negotiated early settlement of all the Convertible Debentures was completed, resulting in principal outstanding of nil. The impact of the Convertible Debentures has been included in the calculation of diluted net income (loss) per share where dilutive and has been excluded from the calculation of diluted net income (loss) per share where anti-dilutive. The dilutive impact of the Convertible Debentures, including both their impact on diluted net income and the dilutive impact of related common shares held by a depositary in connection with any conversion thereof, was excluded from the calculation of diluted net income per share for the nine months ended September 30, 2015 as their impact would have been anti-dilutive.

    Diluted net income (loss) per share has been calculated using the treasury stock method. In applying the treasury stock method, outstanding employee stock options with an exercise price greater than the average quoted market price of the common shares for the period outstanding are not included in the calculation of diluted net income (loss) per share as the impact would be anti-dilutive.

    For the three months ended September 30, 2015, 6,981,555 employee stock options were excluded from the calculation of diluted net income per share as their impact would have been anti-dilutive. For the three months ended September 30, 2014, the impact of any additional shares issued under the employee stock option plan or shares related to the RSU plan were excluded from the calculation of net loss per share as their effect would have been anti-dilutive due to the net loss recorded for the period.

    For the nine months ended September 30, 2015, 6,851,055 (nine months ended September 30, 2014 — 8,970,710) employee stock options were excluded from the calculation of diluted net income per share as their impact would have been anti-dilutive.

49



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

12.   STOCK-BASED COMPENSATION

    (a)
    Employee Stock Option Plan ("ESOP")

    The following table sets out activity with respect to Agnico Eagle's outstanding stock options:

   
  Nine Months Ended
September 30, 2015
  Nine Months Ended
September 30, 2014
 
   
  Number of
Stock
Options
  Weighted
Average
Exercise
Price
  Number of
Stock
Options
  Weighted
Average
Exercise
Price
 
 

Outstanding, beginning of period

    11,913,210   C$ 48.84     11,283,535   C$ 56.02  
 

Granted

    3,068,080     29.09     3,187,500     28.07  
 

Exercised

    (579,358 )   29.74     (582,925 )   31.46  
 

Forfeited

    (58,514 )   44.82     (250,750 )   53.08  
 

Expired

    (2,044,081 )   57.01     (1,724,150 )   62.64  
                     
 

Outstanding, end of period

    12,299,337   C$ 43.48     11,913,210   C$ 48.84  
                     
 

Options exercisable, end of period

    7,702,445   C$ 50.31     7,500,835   C$ 55.98  
                     

    The average share price of Agnico Eagle's common shares during the nine months ended September 30, 2015 was C$36.08 (nine months ended September 30, 2014 — C$36.60).

    Agnico Eagle estimated the fair value of stock options under the Black-Scholes option pricing model using the following weighted average assumptions:

   
  Nine Months Ended
September 30,
 
   
  2015   2014  
 

Risk-free interest rate

    1.50%     1.56%  
 

Expected life of stock options (in years)

    2.7     2.6  
 

Expected volatility of Agnico Eagle's share price

    45.0%     42.5%  
 

Expected dividend yield

    1.69%     3.82%  

    The total compensation expense for the ESOP recorded in the general and administrative line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss) during the three months ended September 30, 2015 was $4.2 million (three months ended September 30, 2014 — $3.5 million) and $16.4 million for the nine months ended September 30, 2015 (nine months ended September 30, 2014 — $16.6 million). Of the total compensation cost for the ESOP, $0.1 million was capitalized as part of the property, plant and mine development line item of the condensed interim consolidated balance sheets for the three months ended September 30, 2015 (three months ended September 30, 2014 — $0.1 million) and $0.5 million for the nine months ended September 30, 2015 (nine months ended September 30, 2014 — $0.7 million).

    (b)
    Restricted Share Unit Plan

    During the nine months ended September 30, 2015, 423,822 (nine months ended September 30, 2014 — 298,877) RSUs were granted with a grant date fair value of $11.9 million (nine months ended September 30, 2014 — $8.6 million). During the nine months ended September 30, 2015, the Company funded the RSU plan by transferring $11.5 million (nine months ended September 30, 2014 — $7.5 million) to an employee benefit trust that then purchased common shares of the Company in the open market.

    Compensation expense related to the RSU plan was $3.8 million for the three months ended September 30, 2015 (three months ended September 30, 2014 — $3.1 million) and $9.5 million for the nine months ended September 30, 2015 (nine months ended September 30, 2014 — $9.4 million). Compensation expense related to the RSU plan is included as part of the general and administrative line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss).

50



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

12.   STOCK-BASED COMPENSATION (Continued)

    (c)
    Incentive Share Purchase Plan

    During the nine months ended September 30, 2015, 392,635 common shares were subscribed for under the incentive share purchase plan (the "Purchase Plan") (nine months ended September 30, 2014 — 367,802) for a value of $10.8 million (nine months ended September 30, 2014 — $11.9 million). The total compensation cost recognized in the nine months ended September 30, 2015 related to the Purchase Plan was $3.6 million (nine months ended September 30, 2014 — $4.0 million).

13.   DERIVATIVE FINANCIAL INSTRUMENTS

    Currency Risk Management

    The Company utilizes foreign exchange economic hedges to reduce the variability in expected future cash flows arising from changes in foreign currency exchange rates. The Company is primarily exposed to currency fluctuations relative to the US dollar as a portion of the Company's operating costs and capital expenditures are denominated in other currencies; primarily the Canadian dollar, Mexican peso and Euro. These potential currency fluctuations increase the volatility of, and could have a significant impact on, the Company's production costs. The economic hedges relate to a portion of the non-US dollar denominated cash outflows arising from non-US dollar denominated expenditures. The Company does not apply hedge accounting to these arrangements.

    As at September 30, 2015, the Company had outstanding foreign exchange zero cost collars. The purchase of US dollar put options was financed through selling US dollar call options at a higher level such that the net premium payable to the different counterparties by the Company was nil. At September 30, 2015, the zero cost collars related to $310.6 million of 2015 and 2016 expenditures and the Company recognized mark-to-market adjustments in the loss on derivative financial instruments line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss). Mark-to-market gains (losses) related to foreign exchange derivative financial instruments are recorded at fair value based on broker-dealer quotations that utilize period end forward pricing of the applicable currency to calculate fair value.

    The Company's other foreign currency derivative strategies in 2015 and 2014 consisted mainly of writing US dollar call options with short maturities to generate premiums that would, in essence, enhance the spot transaction rate received when exchanging US dollars for Canadian dollars. All of these derivative transactions expired prior to period end such that no derivatives were outstanding as at September 30, 2015 or December 31, 2014. The call option premiums were recognized in the loss on derivative financial instruments line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss).

    Commodity Price Risk Management

    To mitigate the risks associated with fluctuating diesel fuel prices, the Company uses derivative financial instruments as economic hedges of the price risk on a portion of diesel fuel costs associated with the Meadowbank mine's diesel fuel exposure as it relates to operating costs. There were derivative financial instruments outstanding at September 30, 2015 relating to 3.0 million gallons of heating oil. The related mark-to-market adjustments prior to settlement were recognized in the loss on derivative financial instruments line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss). The Company does not apply hedge accounting to these arrangements.

    Mark-to-market gains (losses) related to heating oil derivative financial instruments are based on broker-dealer quotations that utilize period end forward pricing to calculate fair value.

    As at September 30, 2015 and December 31, 2014, there were no metal derivative positions. The Company may from time to time utilize short-term financial instruments as part of its strategy to minimize risks and optimize returns on its by-product metal sales.

51



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

13.   DERIVATIVE FINANCIAL INSTRUMENTS (Continued)

    The following table sets out a summary of the amounts recognized in the loss on derivative financial instruments line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss):

   
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
   
  2015   2014   2015   2014  
 

Premiums realized on written foreign exchange call options

  $ 723   $ 520   $ 2,085   $ 1,755  
 

Realized (loss) gain on warrants

        (4,680 )   9,071     (4,865 )
 

Unrealized loss on warrants(i)

    (363 )   (6,254 )   (2,133 )   (927 )
 

Realized (loss) gain on currency and commodity derivatives

    (15,136 )   (41 )   (19,361 )   743  
 

Unrealized (loss) gain on currency and commodity derivatives(i)

    (1,774 )   2,547     (5,952 )   (350 )
                     
 

Loss on derivative financial instruments

  $ (16,550 ) $ (7,908 ) $ (16,290 ) $ (3,644 )
                     

    Note:

    (i)
    Unrealized gains and losses on financial instruments that did not qualify for hedge accounting are recognized through the loss on derivative financial instruments line item of the condensed interim consolidated statements of income (loss) and comprehensive income (loss) and through the other line item of the condensed interim consolidated statements of cash flows.

14.   SEGMENTED INFORMATION

 
Nine Months Ended September 30, 2015:
  Revenues from
Mining
Operations
  Production
Costs
  Exploration and
Corporate
Development
  Segment
Income
(Loss)
 
 

Northern Business:

                         
 

LaRonde mine

  $ 235,498   $ (140,242 ) $   $ 95,256  
 

Lapa mine

    79,771     (39,919 )       39,852  
 

Goldex mine

    103,359     (47,900 )       55,459  
 

Meadowbank mine

    333,057     (181,387 )       151,670  
 

Canadian Malartic joint operation (note 5)

    249,128     (125,380 )   (4,202 )   119,546  
 

Kittila mine

    158,980     (93,892 )       65,088  
                     
 

Total Northern Business

    1,159,793     (628,720 )   (4,202 )   526,871  
                     
 

Southern Business:

                         
 

Pinos Altos mine

    197,231     (80,824 )       116,407  
 

Creston Mascota deposit at Pinos Altos

    49,483     (19,208 )       30,275  
 

La India mine

    95,993     (36,724 )       59,269  
                     
 

Total Southern Business

    342,707     (136,756 )       205,951  
                     
 

Exploration

            (80,150 )   (80,150 )
                     
 

Segments totals

  $ 1,502,500   $ (765,476 ) $ (84,352 ) $ 652,672  
                     
 

Total segments income

  $ 652,672  
 

Corporate and other:

                         
 

Amortization of property, plant and mine development

    (451,480 )
 

General and administrative

    (74,468 )
 

Impairment loss on available-for-sale securities

    (8,106 )
 

Finance costs

    (57,341 )
 

Loss on derivative financial instruments

    (16,290 )
 

Gain on sale of available-for-sale securities

    24,599  
 

Environmental remediation

    (337 )
 

Foreign currency translation gain

    6,009  
 

Other expenses

    (11,651 )
                           
 

Income before income and mining taxes

  $ 63,607  
                           

 

52



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

14.   SEGMENTED INFORMATION (Continued)

 
Nine Months Ended September 30, 2014:
  Revenues from
Mining
Operations
  Production
Costs
  Exploration and
Corporate
Development
  Segment
Income
(Loss)
 
 

Northern Business:

                         
 

LaRonde mine

  $ 227,630   $ (141,107 ) $   $ 86,523  
 

Lapa mine

    81,733     (43,593 )       38,140  
 

Goldex mine

    87,531     (47,486 )       40,045  
 

Meadowbank mine

    468,918     (203,725 )       265,193  
 

Canadian Malartic joint operation (note 5)

    103,107     (66,215 )   (1,423 )   35,469  
 

Kittila mine

    125,662     (80,347 )       45,315  
                     
 

Total Northern Business

  $ 1,094,581     (582,473 )   (1,423 )   510,685  
                     
 

Southern Business:

                         
 

Pinos Altos mine

    191,970     (90,652 )       101,318  
 

Creston Mascota deposit at Pinos Altos

    43,451     (20,278 )       23,173  
 

La India mine

    63,674     (23,839 )       39,835  
                     
 

Total Southern Business

    299,095     (134,769 )       164,326  
                     
 

Exploration

            (40,143 )   (40,143 )
                     
 

Segments totals

  $ 1,393,676   $ (717,242 ) $ (41,566 ) $ 634,868  
                     
 

Total segments income

  $ 634,868  
 

Corporate and other:

                         
 

Amortization of property, plant and mine development

    (294,533 )
 

General and administrative

    (92,776 )
 

Impairment loss on available-for-sale securities

    (2,881 )
 

Finance costs

    (55,249 )
 

Loss on derivative financial instruments

    (3,644 )
 

Gain on sale of available-for-sale securities

    5,372  
 

Environmental remediation

    (9,163 )
 

Foreign currency translation gain

    3,170  
 

Other income

    1,686  
                           
 

Income before income and mining taxes

  $ 186,850  
                           

53



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

14.   SEGMENTED INFORMATION (Continued)

 

   
  Total Assets as at  
   
  September 30,
2015
  December 31,
2014
 
 

Northern Business:

             
 

LaRonde mine

  $ 831,706   $ 856,489  
 

Lapa mine

    59,604     74,131  
 

Goldex mine

    199,132     205,101  
 

Meadowbank mine

    593,217     660,278  
 

Canadian Malartic joint operation (note 5)

    2,033,248     2,068,532  
 

Meliadine project

    538,143     487,901  
 

Kittila mine

    921,072     931,335  
             
 

Total Northern Business

    5,176,122     5,283,767  
             
 

Southern Business:

             
 

Pinos Altos mine

    607,098     573,786  
 

Creston Mascota deposit at Pinos Altos

    74,988     84,176  
 

La India mine

    540,087     543,297  
             
 

Total Southern Business

    1,222,173     1,201,259  
             
 

Exploration

    194,540     144,580  
             
 

Corporate and other

    212,773     179,649  
             
 

Total assets

  $ 6,805,608   $ 6,809,255  
             

15.   COMMITMENTS AND CONTINGENCIES

    As part of its ongoing business and operations, the Company has been required to provide assurance in the form of letters of credit for environmental and site restoration costs, custom credits, government grants and other general corporate purposes. As at September 30, 2015, the total amount of these guarantees was $188.6 million.

    As at September 30, 2015, the Company had $25.9 million of commitments related to the purchase of property, plant and mine development.

16.   SUBSEQUENT EVENTS

    Dividends Declared

    On October 28, 2015, Agnico Eagle announced that the Board approved the payment of a quarterly cash dividend of $0.08 per common share (a total value of approximately $17.4 million), to be paid on December 15, 2015 to holders of record of the common shares of the Company on December 1, 2015.

17.   ONGOING LITIGATION

    Securities Class Action Lawsuits

    On March 8, 2012 and April 10, 2012, a Notice of Action and Statement of Claim (collectively, the "Ontario Claim") were issued by William Leslie, AFA Livforsakringsaktiebolag and certain other entities against the Company and certain of its current and former officers, some of whom who also are or were directors of the Company. The plaintiffs alleged that the Company's public disclosure concerning water flow issues at its Goldex mine was misleading. The Ontario Claim was issued by the plaintiffs on behalf of all persons and entities who acquired securities of the Company during the period March 26, 2010 to October 19, 2011, excluding persons resident or domiciled in the Province of Quebec at the time they purchased or acquired such securities. The plaintiffs sought, among other things, damages of C$250.0 million. Following negotiations with the plaintiffs, on April 17, 2013 an Order was granted on consent of the plaintiffs and defendants certifying a class action proceeding and granting leave for the claims under Section 138 of the Securities Act (Ontario) to proceed.

54



AGNICO EAGLE MINES LIMITED
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(thousands of United States dollars, except share and per share amounts, unless otherwise indicated)
(Unaudited)
September 30, 2015

17.   ONGOING LITIGATION (Continued)

    On March 28, 2012, the Company and certain of its current and former officers, some of whom also are or were directors of the Company, were named as respondents in a Motion for Leave to Institute a Class Action and for the Appointment of a Representative Plaintiff (the "Quebec Motion"). The action is on behalf of all persons and entities with fewer than 50 employees resident in Quebec who acquired securities of the Company between March 26, 2010 and October 19, 2011. The proposed class action is for damages of C$100.0 million arising as a result of allegedly misleading disclosure by the Company concerning its operations at the Goldex mine. On October 1, 2013, the Quebec court certified the class action on terms identical to those set out in the consent Order granted in Ontario on April 17, 2013.

    In September 2015, the Company participated in a mediation with the plaintiffs in respect of both the Ontario and Quebec actions and reached an agreement in principle to settle the Ontario and Quebec actions for C$17.0 million without any admission of liability. As part of the settlement, the proceedings against the Company and certain of the Company's current and former officers, some of whom also are or were directors of the Company, will be dismissed. The settlement is subject to court approval in Ontario and Quebec which the Company expects will be sought in January 2016. The amount of the settlement is expected to be covered by the insurers to the Company. As at September 30, 2015, the Company recorded C$17.0 million in the accounts payable and accrued liabilities line item of the condensed interim consolidated balances sheets to reflect the expected settlement payment, with an equal amount recorded in the other current assets line item of the condensed interim consolidated balances sheets to reflect the related expected insurance receivable.

55


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Third Quarter Report 2015
AGNICO EAGLE MINES LIMITED MANAGEMENT'S DISCUSSION AND ANALYSIS (Prepared in Accordance with International Financial Reporting Standards) For the Three and Nine Months Ended September 30, 2015
AGNICO EAGLE MINES LIMITED MANAGEMENT'S DISCUSSION AND ANALYSIS (Prepared in Accordance with International Financial Reporting Standards) For the Three and Nine Months Ended September 30, 2015
AGNICO EAGLE MINES LIMITED SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS (thousands of United States dollars, except where noted)
AGNICO EAGLE MINES LIMITED SUMMARIZED QUARTERLY DATA (thousands of United States dollars, except where noted)
AGNICO EAGLE MINES LIMITED CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS (thousands of United States dollars, except share amounts) (Unaudited)
AGNICO EAGLE MINES LIMITED CONDENSED INTERIM CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) (thousands of United States dollars, except per share amounts) (Unaudited)
AGNICO EAGLE MINES LIMITED CONDENSED INTERIM CONSOLIDATED STATEMENTS OF EQUITY (thousands of United States dollars, except share and per share amounts) (Unaudited)
AGNICO EAGLE MINES LIMITED CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (thousands of United States dollars) (Unaudited)
AGNICO EAGLE MINES LIMITED NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (thousands of United States dollars, except share and per share amounts, unless otherwise indicated) (Unaudited) September 30, 2015


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