Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — European Gold Forum 2019
22 slides from Royal Gold's conference presentation, April 2019
Slide 1: European Gold Forum April 2019
NASDAQ: RGLD Bill Heissenbuttel CFO and Vice President Strategy European Gold Forum April 2019
Slide 2: Cautionary Statement
Cautionary Statement Cautionary “Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: 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
Slide 3: Fiscal Q2 Results and Liquidity
NASDAQ: RGD Fiscal Q2 Results and Liquidity Highlights: Revenue of $97.6M Volume of 79,600 GEOs1 Earnings of $0.36/share Cash flow from operations of $58.8M Dividends of $16.4M ($1.06 per share for CY 2019) Balance sheet continues to strengthen Expect to repay $370M June 2019 bonds with cash from re
Slide 4: Strategy Score Card: Gold Focus
NASDAQ: RGD Strategy Score Card Gold Focus 75% of Q2 F2019 revenue from gold, 10% from silver, 11% from copper Approximately 85% of Q2 F2019 revenue from North America, Dominican Republic and Chile 4
Slide 5: Strategy Score Card: Reinvest Cash Flow
NASDAQ: RGD Strategy Score Card Reinvest Cash Flow Last secondary share offering in 2012 Cash flow increased 103% since 2012 $350 $1,800 $1,700 $300 $1,600 Average Gold Price (US$/oz) $250 $1,500 OCF (US$ million) $1,400 $200 $1,300 $150 $1,200 $100 $1,100 64.9 65.0 65.1 65.2 65.3 $1,000 57.2 63.3 $
Slide 6: Growing and Sustainable Dividend
NASDAQ: RGD Strategy Score Card Growing and Sustainable Dividend Dividend increased to $1.06/share for CY 2019 from $1.00/share for CY 2018 18% CAGR in dividends per share 2001-2019 $1.20 $1,800 $1,600 $1.00 $1,400 Annual Dividend (US$/share) Average Gold Price (US$/oz) $0.80 $1,200 $0.60 $1,000 $80
Slide 7: Cupric Khoemacau Transaction Overview
NASDAQ: RGD Cupric Khoemacau Transaction Overview Transaction between RGLD Gold AG, a wholly-owned subsidiary of Royal Gold, Inc., and a wholly owned subsidiary of Cupric Canyon Capital LP (“Cupric”) $212-265M advance payment: — Silver Stream: $212M for 80% of Ag produced — Option Stream: Up to $53M
Slide 8: Khoemacau – Project Execution Status
NASDAQ: RGD Khoemacau – Project Execution Status2 Pre-construction activities are advanced Permits and approvals for construction in place Detailed engineering 60% complete Site clearing and box cuts underway Execution team identified/assembled Owner’s team in place Fluor engaged as EPCM contractor
Slide 9: Impact to Royal Gold
NASDAQ: RGD Impact to Royal Gold Average Ag deliveries expected to be 1.5M oz/yr (80% stream) to 1.9M oz/yr (100% stream) 5.5-6.5% GEO* growth based on average 1.9M oz/yr Ag production 18,000 GEOs (80% stream); 22,000 GEOs (100% stream) Ag contribution to total revenue expected to increase from ~10%
Slide 10: Cupric Canyon Capital
NASDAQ: RGD Cupric Canyon Capital2 Cupric is privately owned by management and funds advised by Global Natural Resources Investments (GNRI) Board / Management has extensive senior-level copper project experience Member Cupric Role Experience Timothy R. Snider Founder and Chairman Ex-President & COO,
Slide 11: Botswana – Background
NASDAQ: RGD Botswana – Background Longest continuing multi-party democracy in Africa General elections held every five years since independence in 1966 “a model for stability in Africa” (US Dept of State, July 13, 2018) “peaceful and democratic, and corruption is low” (Economist Investment Risk Heat
Slide 12: Khoemacau – Geography
NASDAQ: RGD Khoemacau – Geography2 Located on the Kalahari Copper Belt in NW Botswana Royal Gold area of interest ~176 km2 Consolidated package assembled by Cupric since 2013 Zone 5 discovered in 2012, but not a focus until acquired by Cupric in 2013 Infrastructure Existing Boseto mill ~15km from re
Slide 13: Khoemacau – Production Profile
NASDAQ: RGD Khoemacau – Production Profile2 Mineable resource3 ~74M t @2.02% Cu and 21.4 g/t Ag Consistent production due to continuity of mineralization along strike and depth Ag contributes approximately 7% of project revenue Planned FS to review expansion potential Zone 5 Life of Mine Parameters:
Slide 14: Khoemacau – Zone 5 Mining
NASDAQ: RGD Khoemacau – Zone 5 Mining2 Zone 5 mine will consist of 3 separate mines: South, Central, North Individual boxcuts with independent twin ramp access for South and Central Each mine operates over ~1,000m strike length Each mine to produce 1.2M t/yr over first five years Conventional sub-le
Slide 15: Khoemacau – Processing
NASDAQ: RGD Khoemacau – Processing2 Boseto plant commissioned 2012 Requires upgrades for higher grade, higher throughput Conventional sulfide flotation circuit to produce ~40% Cu concentrate Thickened tailings pumped to existing tailings storage facility Filtered tailings to be used for mine backfil
Slide 16: Portfolio Update
NASDAQ: RGD Portfolio Update Mount Milligan (Centerra)4 Achieved high end of 2018 guidance 2019 guidance: 155-175k oz gold, 65-75M lb copper Permits received to access additional surface and ground water through Nov. 2021 Expects reduced throughput until start of spring melt, returning to 55k t/day
Slide 17: Portfolio Update
NASDAQ: RGD Portfolio Update Voisey’s Bay (Vale) Comprehensive settlement to long-standing litigation — 2.7% royalty on all metals reinstated effective April 1, 2018 Voisey’s Bay underground expansion to extend mine life through to 20344 Nickel production 38k t/year from 2018 to 2020, ramping up to
Slide 18: Portfolio Update
NASDAQ: RGD Portfolio Update Pueblo Viejo (Barrick)4 Progressing towards FS for expansion project — Evaluating pre-oxidation options (tank leach vs. leach pad) — Pilot flotation concentrator construction advanced — Evaluating additional tailings capacity options Target throughput increase by 50%, al
Slide 19: Portfolio Update
NASDAQ: RGD Portfolio Update Peak Gold Project Joint Venture ownership: — 60% Contango Ore Inc. (CTGO) — 40% Royal Gold; plus: o 12.7% equity interest in CTGO o 2% and 3% royalty interests o Operator Positive PEA5 results announced September 2018 — M&I resource6 9.2M t @ 4.08 g/t — $294M initial cap
Slide 20: Solid, Steady, Successful Performance
NASDAQ: RGD Solid, Steady, Successful Performance Cash flow and growth from broad portfolio 400 Indexed (May 22, 2006 = 100) 350 Disciplined approach to capital deployment 300 250 Strong financial position 200 150 Well positioned for new business 100 opportunities 50 0 Leading shareholder return May
Slide 21: Endnotes
Endnotes 1. Gold Equivalent Ounces (“GEOs”) are calculated as revenue divided by the average gold price for the same period. 2. Information on slides 8, and 10 through 15 was provided to the Company by Cupric Canyon Capital L.P., the owner and developer of the Khoemacau Project. Cupric is a privatel
Slide 22: 1660 Wynkoop Street, #1000 Denver, CO 80202 info@royalgold.com
NASDAQ: RGLD 1660 Wynkoop Street, #1000 Denver, CO 80202 303.573.1660 info@royalgold.com www.royalgold.com