Ladies and gentlemen, thank you for standing by, and welcome to the Agnico Eagle Mines Limited Annual Meeting 2020. At this time, all participants are in a listen only mode. I would now like to hand the conference over to your speaker today, Mr. Jim Naso, Chairman. Thank you.
Please go ahead, sir.
Thank you. Thank you, operator. Welcome to the Annual and Special Meeting of the Shareholders of Agnico Eagle Mines Limited. My name is Jim Nancell, and I'm Chairman of the Board of Agnico Eagle Mines. And Westa Assemblia and well actionistas the Equitable Mines Libertara.
We nombre as Ladies and gentlemen, welcome to our meeting and I hope everyone's safe at home. We're doing this remotely. We've all hopefully again been vigilant. We'll go through the necessary legal requirement. I'll read that and we'll be free to join Sean, have him join us in this presentation.
And there will be question and answers following his presentation. And any of the questions that we don't get to answer for some reason, feel free to contact us or we will answer them by e mail. So I'll begin. As announced in the corporation press release dated April 9, 2020, due to the continuing public impact of the COVID-nineteen pandemic and having regard to the health and safety of the corporation's employees and shareholders as well as public health guidelines to live at gatherings of people, the corporation changed the location of today's meetings from in person to the virtual format in which we are currently convene. We look forward to returning to an in person Annual General Meeting next year.
Joining me for the meeting today are Sean Boyd, Vice Chair and Chief Executive Officer and Director of the Corporation Chris Volmerhausen, Vice President, Legal and Corporate Secretary of the Corporation. As this meeting is held virtually via webcast, we think it may be appropriate to settle a few procedures for the orderly conduct of the meeting. I will now turn it over to Chris to go over these procedures. Chris, please.
Thank you, Mr. Chair. As mentioned, I will now outline the procedures for the orderly conduct of this meeting. Questions in respect of a motion can be submitted by any registered shareholder or duly appointed proxy holder using the instant messaging service of the virtual meeting interface. Please note that there might be a slight delay in the publication of the communications received.
Questions for the question and answer period will appear shortly after they are submitted, but will only be addressed during the question period at the end of the meeting. For the purposes of the meeting today, voting on all matters will be conducted by electronic ballot. Registered shareholders and duly appointed proxy holders who have not previously voted or who wish to change their votes will be asked to vote on each business item after the presentation of all business items. If you have submitted your vote prior to this meeting, there is nothing for you to do unless you wish to change your vote. When you are asked to vote, you will receive a message on the virtual meeting interface guide, including instructions on how to vote, was distributed to shareholders and is available under the corporation's profile on the SEDAR website.
Mr. Chair?
Thank you. Thank you, Chris. Since this meeting was called for 11 am, it is now that time I ask the meeting to come to order. In accordance with the bylaws of the corporation, I will preside as Chair of this meeting. Mr.
Walmer Schausen will act as Secretary of the meeting and I hereby appoint Shirley Tom and Louise Waltonbury of Computershare Trust Company of Canada, the corporation's register and transfer agents to act as scrutineers. After the formal business of the meeting, Sean Boyd will present a brief corporate update followed by a question and answer period in order to expedite matters today. Mr. Walmers Hausen will move all motions and Mr. Boyd will second all motions with respect to the business at this meeting.
I confirm that I have received the sworn affidavit of an officer of Computershare Trust Company of Canada stating that the notice of the meeting, the management information circular and a form of proxy have been sent or made available to each shareholder, each director and the auditors of Agnew Weigel. The affidavit as to such mailing has been signed by Computershare and I direct the secretary of the meeting to keep a copy of the affidavit with the minutes of the meeting. Unless there is any objection, I will dispense with the reading of the notice of the meeting The court, the scrutineers have advised me that prior to the meeting proxies were received from the holders of a sufficient number of shares to constitute a quorum. I therefore declare the meeting to be regularly called and properly constituted for the transaction of business. I directed the formal report of the scrutineers be annexed to the minutes of this meeting as a schedule.
Again, excuse me, it's drying here. The first meeting the first item of form of business is the presentation of the audit financial statements of Agnik, we hope, for the year ended December 31, 2019, and the auditor's report has these financial statements, both of which have been previously sent or made available to the shareholders of the corporation. Questions regarding these statements will be entertained at the end of the meeting. Election of the Directors. The next item of formal business is the election of the Directors of the corporation.
The articles of the corporation provide for a minimum of 5 and a maximum of 15 directors. The Board of Directors has determined that the total number of directors to be elected at this time and the meeting is 10. I now declare the meeting open for nominations. May I have the nominations please?
Mr. Chair, I nominate as directors of Agnico Eagle Mines Limited Doctor. Leanne Baker, Shawn Boyd, Martine Sileges, Robert Gemmell, Nell Lederman, Deborah McComb, James Naso, Doctor. Sean Reilly, Murphin Roberts and Jamie Sikalsky, all is named in the management information circular and move that they be elected directors of the corporation to hold office until the next annual shareholders meeting following this meeting or until their respective successors are elected or appointed.
Thank you, Chris. May I have a second to the motion? I second the motion. Thank you, Mr. Boyd.
Thank you. Under the bylaws of the corporation, any director nominations for today's meetings were required to have been received by no later than the close of business on April 1, 2020. As no such nominations were received by the corporation prior to that date, There are no further nominees elected to stand for election today. Accordingly, I now declare the nominations closed. Unless there are any questions, I will move to the next item of business.
Appointment of the auditors. The next item of formal business is the appointment of the auditors of Agnew Weagle for the current year. It is proposed that Ernst and Young chartered accountants be reappointed as the auditors of the corporation to hold office until the next annual meeting with the shareholders of the corporation or until the successors are appointed and that the auditors' remuneration be fixed by the Board of Directors of the corporation. May I have an appropriate motion please? Mr.
Chair, I so move. A seconder. I second the motion. Thank you, Sean. Unless there are any questions, I'll move to the next item of business.
Advisory resolution on approach to executive compensation. The next item of formal business to consider at this meeting is a non binding advisory resolution of the corporation's approach to executive compensation. May I have an appropriate motion, please?
Mr. Chair, I move that the resolution approving on an advisory basis the corporation's approach to executive compensation as set out in Appendix B to the Management Information Circular dated March 17, 2020 be approved.
May I have a second of the motion? I second the motion. Thank you, Sean. Unless there are any questions, we will now move on to the voting. As mentioned, voting today will be conducted by electronic ballot.
I will now take a moment to ask if the validating the open registered holders and appointed proxy holders. The polls are now open and at this point all registered holders and proxy holders will have properly logged in with their control numbers or username and have not previously voted or wish to change their vote will be able to see on the screen all motions being brought forth at this meeting. We will now pause for approximately 3 minutes while the votes are cast. The polls are now closed. The secretary has advised me that we have received the scrutineers report, which indicates the number of shares voted by proxy prior to the meeting.
I am pleased to report that the election of each of the directors, the appointment of the auditors and the non binding advisory vote on the approach to executive compensation have each been has each passed. If any shareholder is interested in the exact number of votes cast in a ballot for or withheld or against With respect to each of these motions, he or she may obtain particulars after the meeting by contacting the secretary. The corporation will also issue a press release filed on SEDAR, a report of the voting results of this meeting. Termination of the meeting, as there is no further business that may be properly brought before the meeting, I will ask someone to move and someone to second the motion that this meeting will now terminate. Mr.
Chair, I so move. Thank you, Chris. I second the motion. Thank you, Sean. I declare the formal portion of this meeting is now terminated.
We will now proceed with the presentation by Sean Boyd. Sean,
please go ahead. Thank you, Jim. And before I begin the presentation, I would like to provide the cautionary language that cautions that the presentation may include certain forward looking statements and these statements are based on the management's current expectations, but are naturally subject to uncertainty and changes in circumstances. These factors may cause the actual results to be materially different from the expectations expressed or implied in the forward statements. The corporation is not under any obligation to update the forward looking statements in today's presentation.
Detailed information about the risks and uncertainties is included in our most recent securities filings with both the Ontario Securities Commission and the Securities Exchange Commission in the United States. So thank you, everyone, and thank you, Jim. And as Jim mentioned, we wish we could be with you in person today, but that isn't possible. So wherever you are, we are grateful that you've been able to join us today. And we wish you and your families all the best as we all deal with the challenges of the COVID-nineteen pandemic.
What I'd like to do today is just take some time to run you through how we as an employer and we as a partner to our communities and governments and as managers and stewards of your capital are managing through these challenging times. I'll give you a sense of how the business is positioned, but I'd also like to take a little bit of time and talk about gold and gold mining shares and how both the commodity and how the gold mining industry is uniquely positioned to do very well going forward in this environment. From the perspective of our current operations and the COVID-nineteen pandemic, we've been impacted from an operational standpoint more than most in the mining industry as we have seen 7 of our 8 operating mines either have their operations suspended or reduced to minimum activities. While we're managing that, the focus and the primary focus of our team and our leaders and our company has essentially been on the protection and safety and well-being of our employees. And we are also focused on how we can, given our unique skills in certain of our locations where we have more logistical support and ability to get things done than the communities or the governments, how we could be of assistance and go that extra step from a social perspective to be there for our communities and for our governments.
We're still trying to, as we move forward, get a feel for this. This has been an extremely complex time, as many of you know, largely given the uncertainty, not many of us know how this is going to unfold. What we've been fortunate to be able to have done over the last couple of weeks is begin the restart and the ramp up of several of our operations. The government of Quebec decided on April 15 that certain industries will be allowed to restart. Mining was one of them.
Our teams did an exceptional job through March and in the 1st part of April engaging governments at all levels to make the case that at GECO Eagle and the gold mining industry in general is in a good position to reopen in a way that not only protects our employees, but also makes their families comfortable by being able to provide and expand hygiene practices, screening practices, physical distance practices. We began to recall our workers in mid April. We they were each called individually by their supervisors. They were sent a video explaining the new procedures that they would see to keep them safe as they return to work. The return to work was voluntary.
We had a 90% positive response to the call back to work. The employees were excited to get back. Our sense is that the measures we have taken will likely continue for many months, and we need to be prepared for this. And as we said, there's still a lot of unknowns going forward. But I think what we've learned over many, many years is the gold business is a long term business.
You need to think long term. I think we can all fairly assume that conditions will improve as we move forward, but we may never get back to what we knew or understood as normal. As we said, we'll likely have to continue these procedures. But I think what we're focused on doing is to continue to make the case that mining is an essential business, given the unique contributions we make in remote parts of the countries where we operate, but also support of the high paying jobs that we provide, the tax revenue that we provide to the governments, the assistance that we can provide those governments in our regions. And we're going to be able to make that case and do it in a way which demonstrates that we can remain in business as we go forward and still keep our employees safe and comfortable.
So that's been our primary focus. That's allowed us to make the case so that we can start restarting our operations. Now how does that position our business? In the Q1, we essentially had 9 days of our Quebec operations, essentially without production. We had a level of operation in our Nunavut operations, which were down to reduced activities because our focus there was to protect the communities in Nunavut from the virus.
And we essentially have isolated our operations in those communities so that we could continue to operate and protect the communities from the virus. What that's done is, in Nunavut, there is a single case in Nunavut, far from our operating regions. And what we're going to do over those next several months is continue to engage our Inuit workforce and have them come back when they feel comfortable. In the meantime, we're able to continue to work and continue to ramp up those operations. We will have an impact on production in Q2 based on the ramp up.
And the reason simply is, is that we were allowed to return to work mid April, but our ramp up is going to take several weeks. And it's going to take several weeks because we need to ensure we get it right. We need to ensure that the employees remain comfortable and their families remain comfortable that they are back at work. And we will have a steady ramp up through the second quarter and be prepared for a strong second half of both production and costs and cash flow generation. So we're in that unique position where we will see rising production going forward in the second half and we'll see declining unit costs.
I would add to that, that the economic fallout from the COVID-nineteen has really impacted many, many industries. And many, many industries are going to take a long time to come back to being close to normal. The mining industry, and particularly the gold industry, is actually better positioned to return much quicker to normal levels. And when we return to normal levels, we're actually coming into an environment where the gold price is higher than it's been in 7 or 8 years. And not many industries can say that they can return to normal and come back to a revenue environment, which suggests continued growth in revenue with the higher gold price.
The nice thing about it is we've got a business that continues to grow and manages costs. We understand the risks. We've got a strategy that's well matched to the opportunity set in front of us. And this business will do well regardless of where the gold price is. But as we said, our expectations going forward is that the gold price will remain strong and has the potential to go higher than its current level of around $1700 And I'll talk a little bit about that now.
If we go back just a few months ago, gold was actually performing extremely well in the face of what was then record high equity markets. From the lows of the late of late 2015, when gold was around $10.50 gold is up approximately 60% from those levels. So, you could actually make the case that from late 2015, gold is quietly building its own gold market. I think what this tells us, it was likely signaling the early signs of a lot of unease among large investors as they were watching global debt levels balloon and they were watching economies that were essentially not growing. And not only were economies not growing, they were not growing at a pace that would actually keep them up with the increase in debt levels.
So that was becoming a problem and large big money was beginning to realize it. Since that time, we've had massive and unprecedented fiscal and monetary stimulus around the globe to deal with the challenges of the COVID-nineteen pandemic. And what this does is it essentially further strengthens the bullish case for gold. What we have now is global debt levels rising much faster than we thought they were going to be rising, while economies actually shrink. This will likely, in our view, keep interest rates, real interest rates extremely low for many years.
These conditions, as we've seen in the past, are very bullish for gold and we actually saw this most recently post financial crisis in 2,008 and 2,009. And in our view, governments will likely have to continue their expansionary policies to try to boost growth. We interestingly enough, we're also hearing things like, well, there's no need to worry about debt anymore. What does it mean? We can just print money.
We can pile up debt. The reason we don't have to worry because we're not going to pay it back. We don't have to pay it back. Well, if that's the case, then there goes the value of your paper. And I think all of this is causing investors to begin to turn their focus to gold, as it's the one asset that over time has proven its ability to hold its value as paper currencies get debased.
And although gold is seeing a bit of a resurgence, it's still very underowned. It's still an underappreciated asset class, particularly among U. S. Investors. And although we're seeing several positive signs suggesting that the bull market that began in late 2015 has a ways to go, people still many people still are not seeing it.
But what are we seeing? We're seeing gold mining shares beginning to sort of edge higher. We're seeing some inflows of new money to specialist funds. We're seeing the early signs of generalist investors starting to get interested. We're seeing several large international banks who have recently increased significantly increased their U.
S. Dollar price targets for gold, some even as high as $3,000 an ounce. What we're also seeing is gold hitting new highs in most major currencies except 1, the U. S. Dollar.
And it's not unreasonable to think that in this cycle, gold will set a new high in U. S. Dollars, which would put it, likely north of $2,000 And our view is what this does is it creates a very good opportunity, particularly in gold mining shares as we move into the second half of this year and into next year. And a gold price of $1700 with the potential to hit an all time high of better than US2 $1,000 really has important implications for the industry's ability to grow its free cash flow, generate higher rates of return and grow dividends. And there is a very real possibility that gold miners will have superior and very strong relative performance on a number of metrics versus a lot of other industries.
As we said earlier, a lot of other industries that were doing extremely well prior to a couple of months ago are likely going to continue to struggle. And so not only is gold going to do well, we think not only are gold mining companies going to do well on their own as an industry, they're also going to stand out, we think, from a relative performance perspective. And although there's no guarantee, many of us have been around a long time, we also because of that experience and what we've seen, we also, in our view, maybe heading into a period that was similar to 1979-eighty in terms of how much cash the industry can generate given where the gold price is and where it's likely to go. And in 70 nine-eighty, gold moved by multiples of the price before 1979. And the biggest challenge of companies at that time was what to do with all that cash.
And Agnico Legal was in that position. And I remember first walking into Agnico Eagle in 1983 and I was amazed at how much cash they had, because they generated all of that cash in that gold price run-in 197980. And what they decided to do, what Paul Penna decided to do was institute a Ginkgo Eagle's first dividend. And we've been paying a dividend since that time, which is 37 consecutive years. So we think this is a tremendous opportunity.
We think we're in the early innings of certainly gold mining share performance. We think there's more headroom on the gold price. And we've worked hard to ensure that our business has always been positioned to do well regardless of the gold price, but we're particularly well positioned as we move forward in an environment where we think gold prices are going to do extremely well given our growing production profile, our ability to manage our costs, a strategy that's well matched to our skill set, an ability to generate rising free cash flow and an ability and demonstrated willingness over 3 plus decades to increase our dividend. So, I'll leave it at that. And again, thank you for joining us today and we'd be happy to answer any questions that you may have.
Thanks once again, Sean. Excellent presentation. I now open the meeting to questions from shareholders and proxy holders. We will try to answer
as many questions as we can that are submitted through the meeting portal. I ask that all attendees who would like to ask a question now use the instant messaging feature of the meeting portal to do so. If your question does not get answered during the meeting today, we will respond to you by e mail after the meeting or feel free to call us. So let's begin. The floor is open for questions.
Mr. Chair, I report that there are no questions at this time.
Very well. Thank you. Okay. We'll carry on then. We can conclude.
I'd just like to make a couple of comments as folks, all of you at home, it was told to me many, many years ago, and this is why we want you to stay safe and healthy. Your health is number 1 and everything else is 0. And that's important. So stay vigilant, stay safe and stay healthy. And you can see what we've gone through and we always survive these challenges.
We have an abundance of resilience and we've always come through better and stronger and that's happened again. And the choices we've made have been good ones And looking forward to the future, it's very, very full of I'm full of optimism and we can't wait to see what happens. And we miss all your smiling faces. We wish you well and we see you next year. All the best.
Thank you.
Ladies and gentlemen, this does conclude today's conference. Thank you for participating. You may now disconnect.