Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — 2016 TD Securities Mining Conference
22 slides from Royal Gold's conference presentation, Jan 27, 2016
Slide 1: 2016 TD Securities Mining Conference
2016 TD Securities Mining Conference Bill Heissenbuttel Vice President Corporate Development and Operations January 2016
Slide 2: Cautionary Statement
Cautionary Statement 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 results to differ m
Slide 3: What Makes Royal Gold Unique
What Makes Royal Gold Unique Opportunity We have recently deployed capital opportunistically in a period of gold price weakness, with a focus on asset quality and current and near-term production, and our valuation has never been more compelling Quality New portfolio additions such as Pueblo Viejo a
Slide 4: Opportunity – Strong Performance
Opportunity – Strong Performance FY2016 Building on Record 2015 Volume and Cash Flow Net Gold Equivalent Ounces Average gold price Record volume of nearly 200,000 net gold equivalent ounces (GEOs) Net Gold Equivalent Ounces1 250,000 $1,800 $1,600 200,000 $1,400 in FY2015 150,000 $1,200 8% CAGR sin
Slide 5: Opportunity – Valuation
Opportunity – Valuation 25% of the industry’s economics, trading at just 15% of the market cap1 RGLD Peer Group Total Net GEOs 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Op. Income 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Market Cap. Golden Star 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Peer g
Slide 6: Opportunity – Valuation
Opportunity – Valuation Royal Gold trading at 1x NAV without Mount Milligan1 $3,500 $3,000 Street Consensus2 1x NAV of Royal Gold’s $2,500 interest in Mount Milligan $2,000 Current market cap $1,500 Street Consensus2 1x NAV of Royal Gold’s $1,000 portfolio without Mount Milligan $500 $0 January 2016
Slide 7: Quality – Mount Milligan Highlights
Quality – Mount Milligan Highlights Mount Milligan Quarterly Payable Gold Production1 70 Thousands of ounces of payable 60 ~60ktpd design capacity achieved 50 at the end of December 20151 production 40 30 CY2016 volume guidance of 20 240,000-270,000 ounces of gold 10 Peñasquito 0 Mount Milligan rank
Slide 8: Quality – Portfolio Transformation
Quality – Portfolio Transformation Pueblo Viejo – Barrick Gold (60% interest), Dominican Republic Will deliver ~50,000 gold equivalent ounces of production per year to Royal Gold1 Gold deliveries began in December 2015; silver deliveries begin in January 2016 Latest Update2: A comprehensive plan t
Slide 9: Quality – Record Streaming Sales
Quality – Record Streaming Sales Transformative Pueblo Viejo stream drives record stream segment results 70,000 Dec 2015 60,000 includes new Quarterly Gross Gold Equivalent contributions 50,000 from Pueblo Viejo Ounces (GEOs) 40,000 30,000 20,000 10,000 Golden Star 0 Calendar Quarter January 2016 9
Slide 10: Growth – Investment Diversity
Growth – Investment Diversity Pueblo Viejo and Rainy River will build on FY2015 success FY2015 GEO Volume Plus Relative Estimated Estimated Distribution of Future GEO Volume1 Contribution From New and Expanding Streams1 100.00% 100% Mount Milligan 300 90.00% Rainy River Net Gold Equivalent Ounces (G
Slide 11: Growth – Return of Capital
Growth – Return of Capital $1.00 15 straight years of dividend $0.90 increases; demonstrates ability to $0.80 balance growth with return of capital $0.70 Dividend increasing in calendar Annual Dividends Paid Per Share $0.60 2016 to $0.92 per share 29% payout ratio of operating cash $0.50 flow in FY2
Slide 12: Endnotes
QUALITY GROWTH OPPORTUNITY Endnotes ROYALGOLD,INC
Slide 13: Endnotes
Endnotes Many of the matters in these endnotes and the accompanying slides constitute forward looking statements and are subject to numerous risks, which could cause actual results to differ. See complete Cautionary Statement on page 2. PAGE 4 OPPORTUNITY – STRONG PERFORMANCE 1. Royal Gold defines n
Slide 14: Endnotes (cont.)
Endnotes (cont.) Many of the matters in these endnotes and the accompanying slides constitute forward looking statements and are subject to numerous risks, which could cause actual results to differ. See complete Cautionary Statement on page 2. PAGE 10 GROWTH – INVESTMENT DIVERSITY 1. Estimates are
Slide 15: Appendix
QUALITY GROWTH OPPORTUNITY Appendix ROYALGOLD,INC
Slide 16: Opportunity – Strong Performance
Opportunity – Strong Performance Strengthening quarterly cash flow and volume despite a lower gold price Calendar Quarter Ended YTD RGLD Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 2016 Operating Income $26 $23 $29 $31 $31 $25 $32 $28 $21 TBR TBR ($m) Operating Cash Flow $3
Slide 17: Growth – New Stream Transactions
Growth – New Stream Transactions Estimated Effective Date or Annual Net Operator Property Strategic Rationale Estimated Current Status GEOs Startup (1 5 years)1 st Producing; one of only three mines in the world to produce >1m oz per Gold deliveries July 1, 2015 - Au Barrick Pueblo Viejo year; first
Slide 18: Growth – Portfolio Transformation: Rainy River
Growth – Portfolio Transformation Rainy River – New Gold, Canada Project: Over its first nine years of full production, the 21,000 tonne per day, combined open-pit underground operation is expected to produce an average of 325 koz of gold per year at all-in sustaining costs of approximately $670 p
Slide 19: Growth – Portfolio Transformation: Wassa and Prestea
Growth – Portfolio Transformation Wassa and Prestea – Golden Star Resources, Ghana Projects: Higher quality Wassa and Prestea underground projects under construction Proven and probable reserves of 1.9 Moz gold across all deposits Measured and indicated gold resources of 3.5 Moz at Wassa and 3
Slide 20: Growth – Portfolio Transformation: Andacollo
Growth – Portfolio Transformation Andacollo – Teck, Chile Andacollo – Teck, Chile Project: Long operating history Well respected partner in Teck, Canada’s largest diversified resource company Proven and probable reserves of 1.6 Moz gold and a 22 year mine life Stream: 100% gold stream to 900
Slide 21: Quality – Investment History
Quality – Investment History Strong reserve profile amongst largest investments, plus significant upside $1,000,000,000 25 Estimated Years of Remaining Reserves $800,000,000 20 $600,000,000 15 $400,000,000 10 $200,000,000 5 $- 0 Initial investment Cumulative net revenue through September 30, 2015 Es
Slide 22: 1660 Wynkoop Street, #1000 Denver, CO 80202-1132 info@royalgold.com
1660 Wynkoop Street, #1000 Denver, CO 80202-1132 303.573.1660 info@royalgold.com www.royalgold.com