Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — Investor Day (April 2021)
102 slides from Royal Gold's investor day presentation, Apr 20, 2021
Slide 1: Virtual Investor Update
Virtual Investor Update April 20, 2021
Slide 2: Agenda
Agenda 1. Introduction and Strategic Review Bill Heissenbuttel, President & CEO 2. How we think about Business Dan Breeze, VP Corporate Development, RGLD Gold AG Development and Growth Jason Hynes, VP Business Development and Strategy 3. Technical Excellence is Fundamental to Mark Isto, EVP and Chie
Slide 3: Cautionary Statement
Cautionary Statement Cautionary “Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: This presentation includes “forward-looking statements” within the meaning of U.S. federal securities laws. Forward-looking statements are any statements other than statements of histo
Slide 4: Introduction and Strategic Review
Introduction and Strategic Review
Slide 5: History of Growing Revenue, Cash Flow and Earnings
History of Growing Revenue, Cash Flow and Earnings Proven business model has been foundation for strong financial performance 9% • RGLD has delivered strong top-line growth; 10-year CAGR of 9% • Key driver for revenue growth coming from gold • Efficient business structure allows for pass-through to
Slide 6: Gold is the Major Driver of Revenue
Gold is the Major Driver of Revenue True to our business strategy, gold continues Gold price is the strongest driver of metal price to be the dominant revenue source sensitivity FY 2020 Revenue Sources FY 2020 Revenue Sensitivity to 10% change in Metal Price -8.3% 8.3% Gold Gold 79% Copper GOLD-FOCU
Slide 7: Efficient, Scalable and High Margin Business
Efficient, Scalable and High Margin Business Efficient business model with high operating margin Our business is built on a core of highly qualified individuals, with… • Low G&A expense and highly scalable business • Ability to leverage third party resources when needed 28 Adjusted EBITDA Margin1 Ca
Slide 8: Denver-based With Global Reach Across Major Mining Jurisdictions
Denver-based With Global Reach Across Major Mining Jurisdictions Internal organization includes Business Development, Operations, Finance and Legal functional areas Vancouver, Royal Gold Corporation Business Development Royal Gold, Inc. Luzerne, RGLD Gold AG headquarters NASDAQ: RGLD Business Develo
Slide 9: Significant Industry Experience Throughout the Company
Significant Industry Experience Throughout the Company Experienced management team complemented by an independent, diverse and highly-qualified Board of Directors Management: Bill Heissenbuttel President & CEO Mark Isto Paul Libner Randy Shefman Dan Breeze VP Corporate Development, EVP & Chief Opera
Slide 10: High Margin Business
High Margin Business Average pre-tax margin for revenue less cost of sales of 83% in FY 2020 • Stream segment: 77% considering Cost of Goods Sold • Royalty segment: 100% Margins: STREAMS $360 $276 77% ROYAL GOLD 83% MARGIN ROYALTIES $139 $139 100% 1 Revenue Revenue less Cost of Sales 1. Revenue less
Slide 11: Leverage to Gold with Market-Leading Return
Leverage to Gold with Market-Leading Return A stable, sustainable investment… …with a heritage of market outperformance (5/22/06 - 4/1/21) Indexed since the formation of the GDX 5.0 1.75 Beta vs. Gold Price GDX 4.5 Providing higher leverage RGLD to gold… 4.0 Spot Gold β Gold SP500 3.85 3.5 DJIA 3.14
Slide 12: Royal Gold Offers Unique Exposure to Gold
Royal Gold Offers Unique Exposure to Gold Exploration No Direct No Direct Exposure Portfolio Sustainable Upside / Exposure to Exposure to to Gold Diversification Dividend Optionality Operating Costs Capital Costs ETFs, Bars and Coins Senior Operating Companies Junior Operating Companies Development
Slide 13: Diverse Portfolio in Established Mining Jurisdictions
Diverse Portfolio in Established Mining Jurisdictions PRINCIPAL PROPERTIES 1 ANDACOLLO 3 Region IV, Chile 3 2 2 CORTEZ Nevada, USA 4 5 3 MOUNT MILLIGAN 4 British Columbia, Canada 5 6 6 4 PEŇASQUITO 7 Zacatecas, Mexico 1 5 PUEBLO VIEJO 1 Sanchez Ramirez, Dominican Republic 41 PRODUCING 6 WASSA 187 19
Slide 14: Broad Portfolio Provides Stable, Predictable and Sustainable Cash Flow
Broad Portfolio Provides Stable, Predictable and Sustainable Cash Flow Royal Gold’s revenue is sourced from a geographically and operationally diverse portfolio, underpinned by primary precious metals mines • Globally-diverse portfolio minimizes • Principal property revenues • Revenue contribution f
Slide 15: ESG Considerations are Integrated into our Approach to Business
ESG Considerations are Integrated into our Approach to Business Environmental Committed to analyzing and mitigating the environment around us; sponsors of innovation and best practices in mining Social Committed to supporting social causes where Source: Sustainalytics we have investments and in our
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Slide 17: Appendix
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Slide 18: Speaker Bio
Speaker Bio Bill Heissenbuttel President and Chief Executive Officer Mr. Heissenbuttel brings more than 30 years of corporate finance experience with 25 of those years in project and corporate finance in the metals and mining industry. He joined Royal Gold in 2006. Mr. Heissenbuttel was appointed Pr
Slide 19: 2015-2020 Revenue Breakdown by Asset and 2021 Operator Guidance
2015-2020 Revenue Breakdown by Asset and 2021 Operator Guidance Fiscal Year Revenue ($000) Calendar 2021 Operator Guidance 1 Stream /Royalty Metal(s) Current Stream /Royalty Interest 2015 2016 2017 2018 2019 2020 Gold (koz) Silver (koz) Copper (Mlb) Lead (Mlb) Zinc (Mlb) Stream : Canada Mount Millig
Slide 20: Non-GAAP Measures
Non-GAAP Measures Non-GAAP Financial Measures and Certain Other Measures Overview of non-GAAP financial measures: Non-GAAP financial measures are intended to provide additional information only and do not have any standard meaning prescribed by U.S. generally accepted accounting principles (“GAAP”).
Slide 21: Non-GAAP Measures
Non-GAAP Measures Reconciliation of non-GAAP financial measures to U.S. GAAP measures Adjusted net income: Year-ended June 30, (amounts in thousands) 2020 2019 2018 2017 2016 Net income and comprehensive income attributable to Royal Gold common stockholders $ 199,343 $ 93,825 $ -113,134 $ 101,530 $
Slide 22: Non-GAAP Measures
Non-GAAP Measures Reconciliation of non-GAAP financial measures to U.S. GAAP measures Adjusted EBITDA Margin: Year-ended June 30, (amounts in thousands) 2020 2019 2018 2017 2016 Net income and comprehensive income $ 196,250 $ 89,079 $ -119,351 $ 92,425 $ -82,438 Depreciation, depletion and amortizat
Slide 23: Non-GAAP Measures
Non-GAAP Measures Reconciliation of non-GAAP financial measures to U.S. GAAP measures Cash G&A Expenses: Year-ended June 30, (amounts in thousands) 2020 2019 2018 2017 2016 General and administrative expense $ 30,195 $ 30,488 $ 35,464 $ 33,350 $ 31,720 Non-cash employee stock compensation expense 9,
Slide 24: Other Disclaimers
Other Disclaimers DISCLAIMER STATEMENT FOR USE OF MSCI ESG RATING THE USE BY ROYAL GOLD OF ANY MSCI ESG RESEARCH LLC OR ITS AFFILIATES (“MSCI”) DATA, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT, RECOMMENDATION, OR PROMOTION
Slide 25: How we think about business development and growth
How we think about business development and growth
Slide 26: Business Development – Experienced Team and Efficient Structure
Business Development – Experienced Team and Efficient Structure Business Development is the “R&D” of Royal Gold, fully integrated with other key functions Jason Hynes, VP BD & Strategy Dan Breeze, P.Eng., VP Corp. Dev. +15 years (banking, corp. dev.) +20 years (capital markets, technical, corp. dev.
Slide 27: Royalties vs. Streams
Royalties vs. Streams Royal Gold provides flexibility by tailoring financing to fit the needs of the operator Purchase price to acquire royalty PHASE OF PROJECT ROYALTY Partner EXPLORATION DEVELOPMENT PRODUCTION A right to a percentage of revenue or Company metals produced from a project after deduc
Slide 28: Royal Gold – Simplified Organizational Structure
Royal Gold – Simplified Organizational Structure Streaming continues to be the focus given benefits for counterparties and Royal Gold Royal Gold, Inc. NASDAQ: RGLD ROYALTIES STREAMS Domicile: USA / Canada Switzerland Owner and manager of royalty Owner and manager of stream Primary business focus: in
Slide 29: Competitive Landscape
Competitive Landscape Unique environment given coincident strength of various forms of financing Status Status • Attractive terms available for higher • Equity markets are open as investor appetite has returned quality counterparties and assets Debt Equity • Equity financings concentrated in smaller
Slide 30: Select Transaction History
Select Transaction History Royal Gold has demonstrated a disciplined approach to capital deployment 2,100 45 Gold (LHS - $/oz) Silver (RHS - $/oz) 2,000 Peak sale - Au + Ag 40 1,900 Rainy River - Au + Ag Andacollo - Au Alturas - Au 1,800 35 Castelo de Sonhos - Au 1,700 Pueblo Viejo - Au + Ag 30 1,60
Slide 31: Business Development Process – Investment Criteria
Business Development Process – Investment Criteria • Opportunities identified through inbound requests, internal initiatives and cultivating relationships • Opportunity set monitored for changes that may upgrade investment prospect INVESTMENT CRITERIA 1. People, Project and Place i. People – Teams w
Slide 32: Business Development Process – Evaluation and Execution
Business Development Process – Evaluation and Execution Multi-step evaluation and execution process can be completed quickly and efficiently Due Diligence Financial Evaluation Transaction and Ongoing Contract Contract Structuring Management • Technical, ESG, • Recognize commodity • Be creative • Fos
Slide 33: Business Development Process – Due Diligence
Business Development Process – Due Diligence Evaluation Process Driven by Subject Matter Expertise • Experienced professionals from diverse technical, financial and legal specialties and sub-specialties working together under tight timeframes • As conclusions are formed, the opportunity is continuou
Slide 34: Business Development Process – Financial Evaluation
Business Development Process – Financial Evaluation Establish value & stress test assumptions • Reasonable commodity price assumptions and due diligence conclusions applied to our base case production profile Financial ESG Risk Risk • This determines the maximum upfront price Royal Gold is willing t
Slide 35: Business Development Process – Capturing Optionality
Business Development Process – Capturing Optionality • RGLD’s business model provides optionality through its investments • Assets can demonstrate increases in value through resource and production growth, and metal price appreciation over time PUEBLO VIEJO WASSA Millions of Gold Ounces5 55% Million
Slide 36: BD Process – Unique Attributes of Royalty Packages
BD Process – Unique Attributes of Royalty Packages • With the right assets and at the right price, royalty packages can provide significant long-term value through optionality • Earlier-stage projects may advance over time and provide future revenue potential • Many portfolios have traded hands, but
Slide 37: Business Development Process – Structuring
Business Development Process – Structuring Creativity is our competitive advantage Pueblo Viejo Structure • Listen to the counterparty and customize a solution that works for all parties • Negotiate commercial features and financial provisions which encourage and facilitate continued investment by t
Slide 38: Case Study – New Business – Khoemacau
Case Study – New Business – Khoemacau Why Whywewe like likeKhoemacau: Khoemacau • People: Experienced executive and project teams with de-risked execution plan, focus on ESG • Project: +20-year initial mine life, competitive cost position, attractive exploration and expansion potential, meaningful c
Slide 39: Case Study – New Business – Khoemacau
Case Study – New Business – Khoemacau Practical solutions Practical solutionsagreed meeteach agreed to meet eachparty’s party’s needs: needs • Robust base-case financing plan • Resource Capital Funds brought in as partner to provide equity component of financing package • Royal Gold security interes
Slide 40: Business Development Process – Contract Management
Business Development Process – Contract Management When circumstances change, Royal Gold changes with them • “Life of mine” nature of contracts means they require occasional amendment to address new circumstances • Royal Gold works with its partners to ensure the investment continues to work for all
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Slide 42: Appendix
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Slide 43: Speaker Bio
Speaker Bio Dan Breeze Jason Hynes Vice President, Corporate Development, RGLD Gold AG Vice President, Business Development and Strategy, Royal Gold Corp. Mr. Breeze has 20 years of technical and commercial experience across international markets. Mr. Hynes has more than 15 years of business develop
Slide 44: Technical excellence is fundamental to our success
Technical excellence is fundamental to our success
Slide 45: Operations – Experienced Team and Efficient Structure
Operations – Experienced Team and Efficient Structure Operations performs a key role in the technical due diligence of new opportunities and in the ongoing monitoring of royalty/stream investments Kain Petterson, P.Eng., Manager BD Commercial 10 years (technical, corp. dev.) Financial & Business Tec
Slide 46: The Technical Review Process Provides for Efficient Screening
The Technical Review Process Provides for Efficient Screening Inquires 100 • Overall number of potential opportunities tends to Idea Generation remain consistent over time Screening Reviews • Screening efficiency is high – those that don’t (10-40 hours) make it to the next stage are dropped quickl
Slide 47: Review and Due Diligence Processes are Systematic
Review and Due Diligence Processes are Systematic Systematic approach used for each opportunity • Critical to quickly identify opportunity strategic fit and quality • Due diligence process designed to define red flags, value drivers and risks • Mitigation strategies for identified risks are built in
Slide 48: In-House Project Screening Tool Provides Consistency
In-House Project Screening Tool Provides Consistency • Screening tool has been used, validated and perfected using several years of experience • Allows for quick assessment using established scoring guidelines and benchmarks to minimize bias • Considers “current state” and potential “future state” a
Slide 49: Review of ESG Factors Has Always Been Part of the Process
Review of ESG Factors Has Always Been Part of the Process AIR Current ESG workbook • Developed in 2019 to more clearly define ESG reviews and documentation ENERGY WATER CRITERIA • Nine areas reviewed and broken down into Policy & Framework six criteria Permits & Approvals • Detailed technical review
Slide 50: Due Diligence Teams are Fit for Purpose
Due Diligence Teams are Fit for Purpose Unique teams formed for each project • Staffed internally with external experts as required • Teams led internally vs. outsourcing to a single engineering firm • Draw on engineering firms, but typically specific people or subject-matter experts • Doubling of r
Slide 51: We Have Adapted to the Virtual Environment
We Have Adapted to the Virtual Environment Virtual site visits have proven to be efficient and in-depth Typical virtual site visits include: • Extensive webcast meetings with project team and subject matter experts • 3D geological review with core photos linked to assay and geology data • Virtual wa
Slide 52: Monitoring Assets Post-Investment is Critical
Monitoring Assets Post-Investment is Critical Stream/Royalty Operations leads the process for review and Investment Period monitoring of existing investments to: Monitoring (site visits, monthly 1. Protect our interest reports, LOM updates • Verification of metal deliveries and royalty payments Mont
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Slide 54: Appendix
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Slide 55: Speaker Bio
Speaker Bio Mark Isto Executive Vice President and Chief Operating Officer, Royal Gold Corp. Mr. Isto has 38 years of experience in mining engineering, mine management, and project development on a regional and global basis. Mr. Isto joined Royal Gold in January 2015 as Executive Director, Project E
Slide 56: Sustainability and good governance are core to our strategy
Sustainability and good governance are core to our strategy
Slide 57: Legal Team – Strong Transactional, Finance and Governance Experience
Legal Team – Strong Transactional, Finance and Governance Experience Legal provides specialized expertise to support business development, ESG and other initiatives Commercial Jessica Borlack, Senior Counsel, Royal Gold Corp. +8 years (transactions, diligence) Randy Shefman, VP & General Counsel +21
Slide 58: ESG – Sustainability Is Our Business
ESG – Sustainability Is Our Business Sustained economic performance cannot be obtained without sound ESG practices Why is ESG important to Royal Gold? How is ESG integrated into Royal Gold’s business? • Sustainability of our investments is fundamental to our • ESG Policy ensures integration of ESG i
Slide 59: Environmental Responsibility – Minimizing Our Impacts
Environmental Responsibility – Minimizing Our Impacts Our office environment Our portfolio of streams and royalties • Modest direct footprint (28 employees, 4 offices) • Endorse the World Gold Council’s Responsible Gold Mining Principles (RGMP’s) and the International Council on • LEED Gold certifie
Slide 60: Social Responsibility – Commitment to Our People and Communities
Social Responsibility – Commitment to Our People and Communities Our people are our most important assets Giving back to our local communities • Several generations of company leadership developed from • $1.5 million charitable giving budget for fiscal 2021 within • Paid leave for employees to volun
Slide 61: Social Responsibility – Commitment to Our Global Communities
Social Responsibility – Commitment to Our Global Communities We strive to partner with our operating counterparties to support meaningful community and social opportunities >$2 million committed to our host communities since 2015 • 5 year, $750,000 commitment to support Golden Star (Oil Palm Plantat
Slide 62: Governance – Best Practices Provide Strong Foundation
Governance – Best Practices Provide Strong Foundation Committed to principled corporate governance, promoting long-term shareholder interests Highly competent and capable independent directors Diverse qualifications and experience of directors • Deep experience across the mining sector William Hayes
Slide 63: ESG Ratings Reflect Leading Approach
ESG Ratings Reflect Leading Approach Recent disclosure of Royal Gold’s approach to sustainability has materially improved market perception and recognition from leading ESG ratings providers 60 51.9 50 SEVERE RISK 40 RATING HIGH 30 23.4 22.8 MEDIUM 18.7 20 10 LOW 0 2018 2019 2020 2021 Source: Sustai
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Slide 65: Appendix
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Slide 66: Speaker Bio
Speaker Bio Randy Shefman Vice President and General Counsel Mr. Shefman has more than 20 years of legal experience in international transactions across the mining, oil and gas, and power sectors. He joined Royal Gold in 2011 as Associate General Counsel and served in that capacity until his appoint
Slide 67: Other Disclaimers
Other Disclaimers DISCLAIMER STATEMENT FOR USE OF MSCI ESG RATING THE USE BY ROYAL GOLD OF ANY MSCI ESG RESEARCH LLC OR ITS AFFILIATES (“MSCI”) DATA, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT, RECOMMENDATION, OR PROMOTION
Slide 68: Growth in the portfolio
I ROYALGOLD, INC Growth in the portfolio
Slide 69: Portfolio Performance in 2020 was Strong
Portfolio Performance in 2020 was Strong Available 2021 guidance for Principal Properties is similar Mt. Milligan Pueblo Viejo (60%) 200 210 190 • 60k t/d throughput 542 • Lower grades expected 162 target in 2021 in line with Copper (M lb/yr) ~560 Gold (k oz/yr) Gold (k oz/yr) 180 170 180 ~490 ~500
Slide 70: Expected Catalysts in the Portfolio
Expected Catalysts in the Portfolio In production Organic growth opportunities expected to add to portfolio revenue and duration Defined startup date Longer-dated production WASSA – Southern Extension to add 11 years to 6-year reserve life PEÑASQUITO – potential for exploration to extend life to 204
Slide 71: Wassa PEA Provides Potential for Significant Mine Life Extension
Wassa PEA Provides Potential for Significant Mine Life Extension WASSA - Ghana Principal Property • PEA covers the Southern Extension 500m to 1,500m below surface; to increase mining rate and use of installed mill capacity • 3.0M oz Measured & Indicated resource, 7.7M oz 177 k oz/yr Inferred resourc
Slide 72: Peñasquito Exploration Potential Could Extend Mine Life to 2040
Peñasquito Exploration Potential Could Extend Mine Life to 2040 PEÑASQUTO - Mexico Principal Property • Exploration targets proximal to active pits has potential to 2040 extend LOM to 2040 • Ongoing regional and district-scale prospectivity assessments applying proprietary technologies Potential LOM
Slide 73: Pueblo Viejo Expansions Expected to Maintain Production and Extend Mine Life
Pueblo Viejo Expansions Expected to Maintain Production and Extend Mine Life PUEBLO VIEJO - Dom. Rep. Principal Property • Studies for process plant and tailings expansion remain supportive for throughput increase to 14M t/yr to allow minimum gold production of 800,000 oz/yr after 2022, unlocking +9
Slide 74: LaRonde Zone 5 to Maintain Increased Production Rate Through 2029
LaRonde Zone 5 (“LZ5”) to Maintain Increased Production Rate Through 2029 LZ5 - Quebec • LZ5 reached commercial production in June 2018 3,000 • Successful implementation of automated mining techniques led to consistent production improvement in t/d 2020; mine expected to maintain 3,000 t/d productio
Slide 75: Relief Canyon Reaches Commercial Production in Nevada
Relief Canyon Reaches Commercial Production in Nevada RELIEF CANYON - Nevada • First gold pour February 2020 90 • Commercial production reached Jan. 11, 2021 k oz/yr • Expected annual production of ~90,000 oz of gold with an initial ~6-year mine life Ave. Production • Historic producing mine; restar
Slide 76: King of the Hills Mine Life Expected to be 16 Years
King of the Hills Mine Life Expected to be 16 Years KING OF THE HILLS - Australia • 2.4M oz reserve (64.6Mt @ 1.2g/t), 4.1M oz resource (91Mt @1.4 g/t) • 16-year mine life, targeted 176k oz/yr production in first 6 years; open pit with underground to provide high-grade 176 k oz/yr ore in years 1-6 Y
Slide 77: Bellevue Gold Project Considers High-Grade Reserve with Exploration Potential
Bellevue Gold Project Considers High-Grade Reserve with Exploration Potential BELLEVUE - Australia • 690k oz reserve (2.7Mt @ 8.0g/t), 2.7M oz resource (8.6Mt @ 9.9g/t) • Stage 1 initial mine life of 7.4 years, average gold production of 151k oz/yr 151 k oz/yr Ave. Production • Existing infrastructu
Slide 78: Manh Choh Project to Provide Satellite Ore to Fort Knox Mine
Manh Choh Project (formerly Peak) to Provide Satellite Ore to Fort Knox Mine MANH CHOH - Alaska • 1.2M oz of Measured and Indicated resource at 4.1 g/t • Estimated production of 1M gold equivalent oz over 4.5 years, with average mined grade of 6 g/t 1 M oz • High-grade, open pit mine with limited pr
Slide 79: Back River Project Fully Permitted with Production Decision Subject to Financing
Back River Project Fully Permitted with Production Decision Subject to Financing BACK RIVER - Canada • Updated feasibility study (March 2021) demonstrates longer mine life and increased production profile • Ore sourced from open pit and underground; tailings to be stored in exhausted open pits; proc
Slide 80: The Khoemacau Project
I ROYALGOLD, INC The Khoemacau Project
Slide 81: Royal Gold Funding Advanced as Project De-Risked
Royal Gold Funding Advanced as Project De-Risked Quarterly funding contributions followed rigorous review of project progress and plans • After April 7 contribution of $28.6M, Royal Gold owns an 84% silver stream1, and has provided $18M in debt funding • Total Royal Gold contribution = $240.6M ($222
Slide 82: Khoemacau Execution Success Enhanced with Credible Counterparties
Khoemacau Execution Success Enhanced with Credible Counterparties Experienced project execution team backed by Tier 1 funding partners Khoemacau Project Execution team: Khoemacau Copper Mining (KCM) Fluor Daniel (Botswana) Ltd. (EPCM contractor) Barminco Mining Services (Mining contractor) Local/Spe
Slide 83: Khoemacau is Transitioning from Construction to Commissioning
Khoemacau is Transitioning from Construction to Commissioning As of March 31, 2021 the project is in month 30 of the 34-month execution schedule; overall 92.1% complete • COVID-19 has impacted the project schedule by 12 weeks; management, contact tracing and isolation of positive cases have been eff
Slide 84: Khoemacau Operations Expected to Start in Calendar Q2 2021
Khoemacau Operations Expected to Start in Calendar Q2 2021 First concentrate is expected to be sold in calendar Q3 2021 Production Forecasts • Mining – ramp up from current levels to nameplate capacity in early 2022 • Milling – commissioning to begin in Q2 2021 and reach nameplate capacity by the en
Slide 85: KCM Intends to Unlock the Full Potential of this New Copper District
KCM Intends to Unlock the Full Potential of this New Copper District Focus on delivering full production at Zone 5 and Boseto while advancing the project pipeline1 Near-term, KCM expects to: i. Complete PFS for the Expansion Project ii. Continue property-scale resource development and exploration ii
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Slide 87: Appendix
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Slide 88: Speaker Bios
Speaker Bios Mark Isto Johan Ferreira John Munro Executive Vice President and Chief Chief Executive Officer, Khoemacau Director Corporate Finance and Operating Officer, Royal Gold Corp. Copper Mining and Cupric Group Development, Khoemacau Copper Mining Mr. Isto has 38 years of experience in mining
Slide 89: How we think about the allocation of capital
How we think about the allocation of capital
Slide 90: Finance – Experienced Team and Efficient Structure
Finance – Experienced Team and Efficient Structure Finance controls financing, tax, reporting and assurance functions to ensure the financial health of the company Dan Rabil, Director, Finance & Metal Sales of RGLD Gold Ag Legal +25 years (finance, metals trading) Financial & Commercial Tax Paul Lib
Slide 91: Royal Gold has a Multi-National Structure
Royal Gold has a Multi-National Structure Overall effective tax rate for fiscal 2021 is expected to be 19-23% Royal Gold, Inc. NASDAQ: RGLD ROYALTIES STREAMS Domicile: USA / Canada Switzerland Owner and manager of royalty Owner and manager of stream Primary business focus: interests contracts Tax tr
Slide 92: Current Financial Position – Strong Liquidity
Current Financial Position – Strong Liquidity As of December 31, 2020, strong liquidity Further debt repayments in January 2021 and April position provides flexibility to pursue new 2021 have reduced current outstanding debt to $0 business opportunities RGLD Liquidity Position Credit Facility balanc
Slide 93: Prioritizing Our Uses Of Capital
Prioritizing Our Uses Of Capital Disciplined capital allocation prioritizes balance sheet, dividends and investment in new business $US M $85 $341 27% $(156) $1 $319 Debt Repayment $(71) Dividends 50% FY2020 Reinvestment $119 23% Beginning Operating Debt Drawn Investments Dividends Misc. Ending Cash
Slide 94: Last Phase of Growth Financed Without Equity
Last Phase of Growth Financed Without Equity 2015 was a year of significant investment, which was financed without dilution to shareholders • $1.5B of total commitments were made to acquire stream interests at Pueblo Viejo, Andacollo, Rainy River and Golden Star • Transactions were funded using debt
Slide 95: Share Count is a Key Metric for Royal Gold
Share Count is a Key Metric for Royal Gold Royal Gold is one of the original members of the VanEck Vectors Gold Miners ETF (“GDX”) and has the lowest share count of all index members 60% GOLD 50% NEM Indexed Share Count (2015 = 0%) 40% RGLD share count has increased <1% since 2015 30% 20% WPM 10% AE
Slide 96: Capital Allocation Record
Capital Allocation Record Royal Gold has a 20 year history of financing growth accretively and without significant equity dilution $3.9B CUMULATIVE REVENUE Change from FY 2000 to FY 2020 $2.4B CUMULATIVE OPERATING CASH FLOW Revenue 53.0x Operating Cash Flow 80.6x $264M CUM. CASH G&A1 EXPENSES Cash G
Slide 97: Dividend Record – Focused On A Sustainable Dividend We Can Grow
Dividend Record – Focused On A Sustainable Dividend We Can Grow Since 2000, Royal Gold shareholders have received a dividend regardless of the gold price CONSISTENT - INCREASING - SUSTAINABLE US$/share US$/oz $1.40 $2,200 17% $1.20 Dividend Payout Ratio Gold Price $2,000 $1,800 DIVIDEND CAGR (FY 200
Slide 98: Royal Gold’s Dividend History is Unique in the Precious Metals Sector
Royal Gold’s Dividend History is Unique in the Precious Metals Sector Dividend payments began in 2000, before the formation of the GDX1 in 2006 Since the inception of the GDX, Royal Gold is the only member to increase its dividend every year 14 Better 12 10 Number of Years with a Year-over-year 8 Di
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Slide 100: Appendix
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Slide 101: Speaker Bio
Speaker Bio Paul Libner Chief Financial Officer and Treasurer Mr. Libner brings more than 20 years of finance and accounting experience. He joined Royal Gold in June 2004. Mr. Libner served as our Controller and Treasurer since June 2018. From June 2004 through May 2018, he served as Controller. Mr.
Slide 102: Q&A Session
WP reomcowwive Q&A Session