Sean Boyd Vice-Chairman and Chief Executive Officer In 2007, Agnico-Eagle continued to gain momentum. We accelerated our drive to increase gold production and reserves, while generating strong earnings and record cash flow. Agnico-Eagle shares outperformed those of many gold producers with a return of 30%. At year-end, the company’s financial position remained strong, and we raised the annual dividend rate by 50%. Achieving Construction Targets With five new gold mines under construction and the extension of the existing LaRonde mine well underway, we have carefully pursued our ambitious mine development objectives. While mine-building is rarely easy and we have a lot of hard work ahead, I am pleased to report that strong project management, excellent cost control and exceptional technical expertise enabled us to meet interim targets and, in some cases, exceed them. At Goldex in Quebec, we are poised to begin gold production in April 2008, approximately two months ahead of schedule. The Kittila mine in northern Finland is on track to start up in September 2008. Together, production from these two new mines is expected to boost total gold production in 2008 by approximately 50% to more than 350,000 ounces. In August, we made the decision to proceed with the construction of a mine at Pinos Altos in northern Mexico and began work immediately. This mine is expected to produce an average of 190,000 ounces of gold and 2.9 million ounces of silver per year over an 11-year mine life, with total cash costs averaging $210 per ounce of gold. Both the Pinos Altos mine and the mine under construction at Lapa, in Quebec, are scheduled to start up in mid-2009. Gold production at our recently acquired Meadowbank project is slated to begin in January 2010. As we achieve each target, we are moving closer to our goal of increasing annual payable gold production to approximately 1.3 million ounces by 2010, a fivefold increase over 2007 levels. Our confidence in our ability to deliver these projects lies in our proven track record, financial capacity and the low-risk nature of the projects themselves. We have approximately $400 million in cash and equivalents, no long-term debt, substantially undrawn bank lines of $300 million and strong cash flows to fund growth without the need for equity financing. Because the projects are manageable in size, located in pro-mining regions, and have relatively short development timelines, our execution risk is diminished. Adding Quality Gold Reserves In 2007, we continued to expand our gold reserve base through exploration. At year-end, Agnico-Eagle’s proven and probable gold reserves rose to a record 16.7 million ounces, from 12.5 million in 2006, further enhancing our exceptional record of growing gold reserves per share. Agnico-Eagle’s gold reserves have increased almost thirteen fold since 1998, while the number of shares outstanding has grown only 2.6 times. With our largest-ever exploration budget of $45 million in 2007, we increased drilling activity on all properties and maintained our focus on upgrading resources to reserves. More than half of our budget was spent in northern Mexico, where we have a large land position of approximately 46,000 hectares. Significant drill results at Pinos Altos resulted in a 21% increase in gold ounces in reserves and a 18% increase in silver ounces. We also began drilling on a shallow deposit just seven kilometres away from the main Santo Nino deposit. We have reason to believe that this new Creston/Mascota area could support a future stand-alone mining operation. Upon acquiring the Meadowbank project in Nunavut, Canada, in April 2007, we embarked on an aggressive exploration program which resulted in a 20% increase in probable gold reserves at the property to 3.5 million ounces. This past year’s exploration results position us to meet our gold reserve target of 18 to 20 million ounces by year-end 2008. In fact, we see potential for several five-million ounce gold deposits and a total gold reserve in excess of 20 million ounces within the not-so-distant future as we continue to encounter potentially ore-grade mineralization outside of the currently defined gold reserve and resource envelopes at our development projects. Acquiring New Properties While not critical to our success at this time, we are always looking to add relatively small projects or assets that can significantly strengthen our business. The search for new, quality growth opportunities continues to be restricted to mining-friendly regions with political stability. As we have done in each of the past few years, we acquired another quality project well matched to our skills and abilities in 2007. With the takeover of Cumberland Resources, we gained 100% control of the Meadowbank gold project in Nunavut, adding substantial gold reserves and near-term gold production. The Meadowbank mine is projected to produce an average of 360,000 ounces of gold per year over a nine-year mine life, with total cash costs averaging $300 per ounce. Our Quebec-based technical team has lent support to the project, enabling us to accelerate the development timeline by six months. Looking Ahead We remain very positive on the gold price and believe gold is in a long-term bull trend. There are several factors that we believe will push the gold price significantly higher including curtailed mine supply combined with much stronger investment demand driven by inflation concerns, a weak US dollar and traditional safe haven buying given the ongoing uncertainty in world financial markets. In the near term, our focus will remain on executing our mine building plans. Our priorities are two-fold: bring our five new gold mines into production on plan over the next two years and add to our sizable gold reserves through an expanded program of aggressive exploration on our existing development projects. A larger, low-cost gold production base and bigger reserve base will enable us to provide our shareholders with enhanced leverage to gold prices, strengthen earnings and cash flows, and reduce overall mining risk. In appreciation of the support I have received in my 10 years as CEO, I would like to thank all of our employees for their hard work and dedication to building a stronger gold company. Agnico-Eagle is better positioned than ever to take advantage of new opportunities. I am truly grateful for the management team and workforce we have in place. Together, we will move forward and continue to set a new standard for gold companies. We have the people, assets and strategy in place to build even more value for you, our shareholders. Sincerely, Sean Boyd Vice-Chairman and Chief Executive Officer March 14, 2008