Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — European Gold Forum 2015
25 slides from Royal Gold's conference presentation, Apr 14, 2015
Slide 1: European Gold Forum
European Gold Forum Stefan Wenger Chief Financial Officer April 14, 2015 SOLID PORTFOLIO. SOLID FUTURE.
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
Slide 3: A Position of Strength
A Position of Strength Growth Mount Milligan is proving transformational and providing an excellent platform for growth Quality High quality properties, counterparties and jurisdictions Opportunity We have approximately $1.2 billion in liquidity and are balancing growth with return of capital April
Slide 4: Mount Milligan Ramp-Up Providing Transformational Growth
Growth Mount Milligan Ramp-Up Providing Transformational Growth Daily mill throughput averaged 48.5k tonnes per day (80% of design) in late December1 Strong 2015; expected unit cash costs of $0.60-$0.85/lb copper, on a by-product basis1 Calendar year 2015 guidance of 220koz to 240koz payable gold pr
Slide 5: Expected Quarterly Sales from Mount Milligan
Growth Expected Quarterly Sales from Mount Milligan1 250 Mt. Milligan reported payable Qtrly Run Rate at Design… production Cumulative Gold Ounces (000’s) 200 Jan 2015 Production subject to RGLD stream (payable production *.5225) Dec 2014 Quarter 150 RGLD gold received to date Sept 2014 Quarter 100
Slide 6: Peñasquito poised for growth in 2015 and long-term
Growth Peñasquito poised for growth in 2015 and long-term Calendar 2015 production estimate of 1.5-1.6Moz GEO’s1 Goldcorp expects an increase of 20-30% over calendar 2014 production Back-end weighted; Higher grade at Peñasco pit is expected after the first calendar quarter Completion of Northern
Slide 7: Phoenix Gold Project Construction
Growth Phoenix Gold Project Construction Rubicon Minerals’ photo of Phoenix Gold Project, Summer 2014 Rubicon Minerals’ mill building interior photo, 2014 As of March 20151: Shaft completed to 730 meters Stockpiling of ore from underground stopes underway 85% of mill circuit completed Tailin
Slide 8: Focused investment criteria yields a world class portfolio
Quality Focused investment criteria yields a world class portfolio 56% of our FY2014 revenues from Counterparty investment-grade rated companies1 Place Over 92% of our reserves from S&P “A” or higher rated countries1 Weighted average cash cost Andacollo, Peñasquito, Project ~$578/GEO, gross margin o
Slide 9: Cash Margin by Operating Property
Quality Cash Margin by Operating Property First Three Quarters of 2014 through Sept 30 90% 80% The operators of our royalties and streams 70% recognized an average 55% gross margin in the first three quarters of 2014, which is an average cash cost of $578 per gold equivalent ounce, on 60% properties
Slide 10: World class, long lived portfolio
Quality World class, long lived portfolio Mt. Milligan Royalty: 52.25% of payable gold1 Contribution to FY2015 Q2 revenue Reserves2: 6.2M oz (Au) 28% or $17.3M Estimated Mine Life: 20+ Years Andacollo Royalty3: 75% of Au production (NSR) Contribution to FY2015 Q2 revenue Reserves4: 1.6M oz (Au) 16%
Slide 11: Long mine lives amongst largest investments
Quality Long mine lives amongst largest investments $1,000 25 $900 Estimated Years of Remaining Mine Life $800 20 $700 $600 15 $ Millions $500 $400 10 $300 $200 5 $100 $- 0 Initial investment Cumulative net revenue through December 31, 2014 Estimated remaining mine life 1 April 2015 11
Slide 12: Approximately $1.2 billion in liquidity
Opportunity Approximately $1.2 billion in liquidity at a time when royalty/stream financing is needed Capital to invest… Net of future commitments ($m) $450M Undrawn $1,185.0 Working capital & undrawn credit at 12-31-14 Liquidity at 12/31/2014 $734M Working Capital Credit -$7.5 Ilovitza initial paym
Slide 13: Consistent dividend growth demonstrates ability to balance growth with return of capital
Opportunity Consistent dividend growth demonstrates ability to balance growth with return of capital $1.00 $0.90 $0.80 $0.70 $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $0.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 April 2015 13
Slide 14: Positive Market Acceptance of our Streaming Product
Opportunity Positive Market Acceptance of our Streaming Product Share Price Performance at Announcement1 Counterparty Shareholder Benefits Attractive cost of capital with +4.1% advantageous NPV/share or cash flow/share basis Lower financing risk with no fixed amortization schedule, +35% no hedgi
Slide 15: A Position of Strength
A Position of Strength Growth Mount Milligan is proving transformational and providing an excellent platform for growth Quality High quality properties, counterparties and jurisdictions Opportunity We have approximately $1.2 billion in liquidity and are balancing growth with return of capital April
Slide 16: Endnotes
Endnotes SOLID PORTFOLIO. SOLID FUTURE.
Slide 17: 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 GROWTH 1. Per Thompson Creek’s press release dated Janua
Slide 18: Appendix A: Background
Appendix A: Background SOLID PORTFOLIO. SOLID FUTURE.
Slide 19: The Quality Royalty / Streaming Name to Own
Royal Gold The Quality Royalty / Streaming Name to Own Longevity – in business since 1981 Exploration Near-term Growth – already bought and paid for No cost inflation concerns Junior Operators Quality assets/reputable partners Intermediate Operators ~80% of Revenue => EBITDA $2.1 billion in investme
Slide 20: Alignment with Counterparties
Alignment with Counterparties Hypothetical example estimate for illustrative purposes only: Equity Stream 200koz/year gold project expansion, 2 year development, 12 yr mine life Current market cap $300,000,000 $300,000,000 Shares outstanding 200,000,000 200,000,000 Share price $1.50 $1.50 Financing
Slide 21: Alignment with Counterparties
Alignment with Counterparties Return of investment based No joint venture involvement on production Royal Gold provides additional No principal amortization or investor exposure maturity date 4-6 week due diligence Deliveries can match key smelter terms Repayment Management Simplified reporting Time
Slide 22: Multiple Investment Entry Points
Alignment with Counterparties Multiple Investment Entry Points1 Capital Consuming Capital Generating 1 For illustrative purposes only April 2015 22
Slide 23: Appendix B: Property Portfolio
Appendix B: Property Portfolio SOLID PORTFOLIO. SOLID FUTURE.
Slide 24: Property Portfolio
Property Portfolio April 2015 24
Slide 25: SOLID PORTFOLIO. SOLID FUTURE.
1660 Wynkoop Street, #1000 Denver, CO 80202-1132 303.573.1660 info@royalgold.com www.royalgold.com SOLID PORTFOLIO. SOLID FUTURE.