Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — BMO 27th Global Metals & Mining Conference (February 2018)
22 slides from Royal Gold's conference presentation, Feb 27, 2018
Slide 1: BMO 27th Global Metals & Mining Conference
BMO 27th Global Metals & Mining Conference Tony Jensen, President & CEO February 27, 2018 NASDAQ: RGLD
Slide 2: Cautionary Statement
Cautionary Statement NASDAQ: RGLD This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that could cause actual result
Slide 3: 20+ Year Track Record
20+ Year Track Record NASDAQ: RGLD Performance Efficiency Discipline Cash flow generation Diverse portfolio Strategic capital allocation Quickly delevering Strong margins Equity stewardship Embedded growth Lean structure Dividend returns | 3
Slide 4: Cash Flow Generation
Performance Cash Flow Generation NASDAQ: RGLD Solid, steady performance with another step-up in cash flow in FQ2 $300 $1,600 $288m $1,400 $250 $1,200 $200 $1,000 US$ Millions $150 $800 $600 $100 $400 $50 $200 $0 $0 12 months 12 months 12 months 12 months 12 months LTM Jun-30-2013 Jun-30-2014 Jun-30-
Slide 5: Quickly Delevering
Performance Quickly Delevering NASDAQ: RGLD Net Debt/EBITDA 1.3x at 12-31-17 Strong liquidity of ~$975 million at 12-31-17 Focus on using free cash flow to reduce debt At current metals prices1 we expect to: Repay the $150 million outstanding on our revolver before June 30, 2018 Repay principal of o
Slide 6: Embedded Growth: Rainy River, Cortez Crossroads, Peñasquito Leach
Performance Embedded Growth NASDAQ: RGLD Rainy River expected to be Top-10 revenue generator for RGLD CY18 deliveries of 23koz gold & 203koz silver expected2,3 4.4Moz gold(+12%); 12.8Moz silver(+28%) in 2017 reserves2,3 Rainy River Barrick: stripping underway, revenue building in CY192 4.5% NVR & 5%
Slide 7: Embedded Growth: Mount Milligan, Wassa and Prestea, Peak Gold
Performance Embedded Growth NASDAQ: RGLD Currently operating at partial capacity (~30ktpd) 2 Restart of second ball mill expected by late April2 Starting to turn focus to exploration Mount Milligan Recent Wassa drilling yielded widest mineralization to date2 94m grading 4.4 grams per tonne gold from
Slide 8: Embedded Growth: Mount Milligan
Performance Embedded Growth NASDAQ: RGLD Mount Milligan | 8
Slide 9: Diverse Portfolio
Efficiency Diverse Portfolio NASDAQ: RGLD Updates from our portfolio2 of 194 total assets (39 operating & 23 development) Development/permitting activity at: Back River (1.95-2.35% NSR) LaRonde Zone 5 (2% NSR) Tetlin (Peak Gold) (3% NSR, JV interest)6 Producing updates (YE 2017) include: Wharf (0-2%
Slide 10: Strong Margins: Gross Margin
Gross Margin Efficiency 20% 40% 60% 80% 100% 0% NYSE:FLR NYSE:ADM NasdaqGS:ESRX NYSE:LLL NYSE:SLB NasdaqGS:EXPD NasdaqGS:PCAR NYSE:FTI NYSE:TXT NYSE:CNC NYSE:LYB NYSE:UPS NYSE:GD NYSE:DLPH NYSE:ADS NYSE:HRL NYSE:ALL NasdaqGS:PDCO NYSE:CSRA NYSE:PH NYSE:CMI NYSE:DTE NYSE:DVA NasdaqGS:HSIC NYSE:HPE NY
Slide 11: Lean Structure: Revenue per Employee
Efficiency Lean Structure NASDAQ: RGLD Our revenue per employee is higher than 497 of the S&P 5007 Revenue per employee NYSE:VTR NasdaqGS:GILD NasdaqGS:CBOE NYSE:DHI NYSE:NBL NYSE:NRG $3m $19m $25m NYSE:PXD NYSE:CF NasdaqGS:VRSN $11m (REIT) (REIT) NYSE:HPQ NasdaqGS:SNI NYSE:TRV NYSE:AIG $2m NYSE:UNH
Slide 12: Strategic Capital Allocation
Discipline Strategic Capital Allocation NASDAQ: RGLD Strong net revenue on capital deployed, with significant mine life remaining8 Net revenue8 on capital 1991-2014 Net revenue10 on capital 2015-2017 Remaining Years of Mine Life $3,000 $3,000 Remaining Years of Mine Life 20 20 $2,500 $2,500 17 years
Slide 13: Equity Stewardship
Discipline Equity Stewardship NASDAQ: RGLD RGLD has 14 million outstanding shares less than the next-highest GDX member 1,800 GDX constituents sorted by shares outstanding11 1,600 1,400 Millions of Shares Outstanding at December 31, 201711 1,200 1,000 800 600 400 200 0 | 13
Slide 14: Dividend Returns
Discipline Dividend Returns NASDAQ: RGLD $1.00/share, a 1.2% annual yield, and an average 22% OCF yield12 19% CAGR in dividends per share since 2001 Latest increase Dividend Per Share Operating Cash Flow Yield Average Gold Price (source: Kitco) $1.00 $1,800 $0.90 $1,600 $0.80 $1,400 Gold Price in US
Slide 15: Strong cash flow generation, solid balance sheet, organic growth
Strong cash flow generation Solid balance sheet Organic growth Robust liquidity NASDAQ: RGLD
Slide 16: Portfolio of Assets
Portfolio of Assets Diverse, Long Lived Properties NASDAQ: RGLD Streams (at February 23, 2018) CY2018 Reserve Operator RGLD RGLD RGLD pays RGLD pays Remaining Operator Mine Metal RGLD interest until until until until until Production interest interest (per unit) (per ounce) Mine Life Guidance (Years
Slide 17: Peak Gold Joint Venture
Peak Gold Joint Venture NASDAQ: RGLD Gold-silver-copper skarn deposit with a strong grade profile, near surface and near existing infrastructure Preliminary M&I resource estimate4 of 1.3 million ounces of gold at $1,400 gold, 0.43 g/t cutoff (AuEq) 13 ~$10m exploration investment planned for calenda
Slide 18: Optionality
Optionality NASDAQ: RGLD Pueblo Viejo: pre-oxidation heap leach & flotation con Potential ~7Moz resource to reserve conversion 2018 pre-feasibility Pueblo Viejo Voisey’s Bay: trial set to begin H2 Calendar 2018 Trial to take place in St. Johns Voisey’s Bay Pascua-Lama: Barrick intends to partner on
Slide 19: About Royal Gold
About Royal Gold NASDAQ: RGLD Gold Investment Opportunity with a Dividend and Reserve Optionality We provide capital in exchange for a life-of-mine percentage of the production • via a streaming or royalty interest • we do not operate any mines Diverse portfolio of 39 producing mines & 194 total int
Slide 20: Highly Experienced Board Leadership
Highly Experienced Board Leadership NASDAQ: RGLD William Hayes Tony Jensen Kevin McArthur Jamie Sokalsky Independent Director and Director; President and CEO, Independent Director; Independent Director; Chairman of the Board; Royal Gold, Inc. Executive Chair, Tahoe Former President and CEO, Former E
Slide 21: Endnotes
Endnotes NASDAQ: RGLD 1. Assuming no change to our existing portfolio. 2. Information has been provided to the Company by the operators of those properties or is publicly available information filed by those operators. Reserves information shown is as of December 31, 2017. References to portfolio re
Slide 22: Contact
1660 Wynkoop Street, #1000 Denver, CO 80202 303.573.1660 info@royalgold.com www.royalgold.com NASDAQ: RGLD
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