Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — Scotiabank Global Banking and Markets Mining Conference 2013
20 slides from Royal Gold's conference presentation, Dec 3, 2013
Slide 1: Scotiabank Global Banking and Markets Mining Conference 2013
Scotiabank Global Banking and Markets Mining Conference 2013 Tony Jensen, President and CEO December 3, 2013
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: Overview
Overview Embedded Growth – Strong track record of growth – Positioned to grow volume ~50% from Mt. Milligan alone Financially Robust – Mt. Milligan investment complete – Low costs with Adjusted EBITDA 1 margin at ~90% of revenue – Liquidity of ~$1 billion Attractive Market Environment – Royalty/Stre
Slide 4: Strong Track Record of Growth
Strong Track Record of Growth December 3, 2013 4
Slide 5: Embedded Growth Fully Invested
Embedded Growth 350 Fully Invested 300 Pascua‐Lama Net Gold Equivalent Ounces in Thousands 250 ~50% estimated Mt. Milligan increase from Current FY 2013 due to 200 ~180k oz/yr Mt. Milligan alone 150 Other 100 Voisey’s Bay 50 Peñasquito Andacollo 0 FY 2013 1,2 Mt. Milligan 3,4 and Pascua‐Lama 5 (Esti
Slide 6: Embedded Growth
Embedded Growth Development Cornerstone Properties Mt. Milligan Stream: 1 52.25% of payable gold Reserves: 2 6.0M oz (Au) Est. Mine Life: 22 Years Commercial Prod: Q1 CY14 Est. Production: 3 262k oz (Au)/yr • Commissioning underway • First concentrate production in September 2013 Photo: July 2013 •
Slide 7: Embedded Growth
Embedded Growth Mt Milligan Facilities Mt Milligan Primary Crusher Mt Milligan Two 24ft Ball Mills Mt Milligan Flotation Circuit December 3, 2013 7
Slide 8: Financially Robust
Financially Robust Diverse Portfolio of Assets December 3, 2013 8
Slide 9: Producing Cornerstone Properties
Financially Robust Producing Cornerstone Properties Andacollo Contribution to Royalty: 1 75% of Au production (NSR) FY2014 Q1 revenue Reserves: 2 1.8M oz (Au) 30% or $17.2M Estimated Mine Life: 20+ Years Estimated CY13 production: 3 63k oz (Au) Peñasquito Contribution to Royalty: 2.0% NSR FY2014 Q1
Slide 10: Cash Margin by Operating Property
Financially Robust Cash Margin by Operating Property 1, 9Mo CY2013 80% 70% 60% 50% Weighted Average Cash Margin 48% 40% Cash Margin 30% 20% 10% 0% 97% * Percentage of 9Mo CY2013 Revenue *3% of Royal Gold’s revenue does not have a corresponding cash margin as the operator does not report it to the le
Slide 11: Efficient Use of Resources Maximizes Margins
Financially Robust Efficient Use of Resources Maximizes Margins $350 $300 $250 Millions $200 $150 $100 Adjusted EBITDA Margin ~ 90% Revenue $50 December 3, 2013 11
Slide 12: Strong Balance Sheet and Cash Flow in an Attractive Market
Financially Robust Strong Balance Sheet and Cash Flow in an Attractive Market Liquidity at September 30, $687M $350M 2013 Working Capital Undrawn Credit $370M convertible Debt and Commitments Debt 2019 @ 2.875% * LTM Operating Cash Flow $154.5M $0 $200 $400 $600 $800 $1,000 $1,200 *Indicates $50M co
Slide 13: Attractive Market Environment
Attractive Market Environment 2012 had lowest percentage Operators, explorers and of mining finance from equity developers facing less in a decade 1, and H1 2013 favorable debt markets as proceeds trended even lower yields have increased Follow‐on Issues By Month US High Yield B Effective Yield 3 (2
Slide 14: Multiple Investment Entry Points
Attractive Market Environment Multiple Investment Entry Points Capital Consuming 1 Capital Generating 2 December 3, 2013 14
Slide 15: Multiple Sources for New Business Opportunities
Attractive Market Environment Multiple Sources for New Business Opportunities 100% 14% 20% 16% 15% 90% The largest 80% source of our 70% 31% gold revenue 48% 48% 60% 44% in fiscal 2013 50% was non‐ 40% precious 30% metals mines 20% 54% 36% 36% 37% 10% 0% 2010A 2011A 2012A 2013A Primary Gold Mines Po
Slide 16: Share Price Remains at Discount to Historical Multiples
Favorably Positioned Share Price Remains at Discount to Historical Multiples 1 RGLD Price / Book Value 2 4.5 4 3.5 3 2.5 5 year average: 2.3x 2 1.5 1 0.5 0 December 3, 2013 16
Slide 17: Royal Gold Summary
Royal Gold Summary Mt. Milligan, September 2013 Embedded Growth – Strong track record of growth – Fully invested Financially Robust – Mt. Milligan investment complete – EBITDA margin ~90% of revenue – Liquidity of ~$1 billion Attractive Market Environment – Compelling alternative to challenging equi
Slide 18: 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 3 OVERVIEW construction activities at Pascua‐Lama, except
Slide 19: 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 9 FINANCIALLY ROBUST PAGE 16 FAVORABLY POSITIONED
Slide 20: Royal Gold contact details
1660 Wynkoop Street Denver, CO 80202‐1132 303.573.1660 info@royalgold.com www.royalgold.com
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