Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — Scotia Capital Precious Metals 2008 Conference
37 slides from Royal Gold's conference presentation, December 2008
Slide 1: Scotia Capital Precious Metals 2008 Conference
Scotia Capital Precious Metals 2008 Conference December 2008
Slide 2: Cautionary Statement
Cautionary Statement Under the Private Securities Litigation 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
Slide 3: Presentation Agenda
Presentation Agenda Strong track record of growth Barrick transaction Royalty portfolio Restructuring of Cortez royalties Key asset review 3
Slide 4: Strong Track Record of Growth
Strong Track Record of Growth 4
Slide 5: Consistent Financial Performance
Consistent Financial Performance Gross Financial Results Per Share Financial Results Net Income Free Cash Flow 1 Royalty Revenue Net Income Free Cash Flow 1 Royalty Revenue $70 2.25 $60 2.00 1.75 ($ in millions) $50 ($ per share) 1.50 $40 1.25 $30 1.00 0.75 $20 0.50 $10 0.25 2004 2005 2006 2007 2008
Slide 6: Reserve and Resource Growth
Reserve and Resource Growth 1,2 Copper B lbs Gold Silver 9 8.1 M oz M oz 6.9 7 110 2,500 5 3.0 2.6 103 3 0.8 100 1 ’04 ’05 ’06 ’07 Pro 2,053 2,057 Forma 3 90 2,000 Zinc 80 40 B lbs 33.7 37.3 80 1,790 30 27.5 70 67 20 1,500 10 60 ’04 ’05 ’06 ’07 Pro Forma 3 50 Lead 1,000 12 B lbs 10.9 10.8 11.0 40 10
Slide 7: Royalty Transactions
Royalty Transactions $181.5M Barrick Royalties 500 El Chanate & Marigold 450 Benso 400 Investment ($ Millions) Battle Mountain 350 Pascua-Lama 300 Peñasquito 250 Gold Hill Taparko 200 Mulatos 150 Robinson 100 Troy 50 2004 2005 2006 2007 2008 Total Investment of $453M 7
Slide 8: Assets in 2007
Assets in 2007 (as of 10/31/07) 8
Slide 9: Asset Growth – 2008
Asset Growth – 2008 (as of 11/26/08) 9
Slide 10: Asset Growth – 2008
Asset Growth – 2008 (as of 11/26/08) 10
Slide 11: Distribution of Revenue by Royalty
Distribution of Revenue by Royalty 2005A 2006A 2007A 2008A 2009E 1 Fiscal Years Ending June 30 Pipeline SJ Claims Leeville Troy Mine Martha Bald Mountain Robinson Taparko Mulatos Peñasquito Gold Hill Dolores Williams El Limon Don Mario El Chanate Benso Barrick Royalties 1 Assumes nine months of prod
Slide 12: Barrick Transaction
fi B ROVALGOLDING The Leading Precious Metal Royatty Company = Barrick Transaction 12
Slide 13: Overview of Barrick Transaction
Overview of Barrick Transaction Acquisition of Barrick Gold’s royalty portfolio by Royal Gold Royal Gold consideration $150M net cash Pipeline Mining Complex Royalty restructuring Royal Gold Net $150M GSR2, GSR3 & NVR1 72 Royalties Cash Royalty Restructuring Barrick Gold 13
Slide 14: Rationale for Transaction
Rationale for Transaction Immediately accretive on all key financial measures Unlocks Crossroads deposit at Cortez Expands and diversifies Royal Gold’s royalty portfolio Provides immediate royalty revenue Enhances pipeline of royalty projects in development Provides significant option value through
Slide 15: Barrick Royalty Portfolio
Barrick Royalty Portfolio One of the largest portfolios of royalties Collection of royalties assembled by Barrick and numerous corporate predecessors Includes royalty interests in 72 properties 57 precious metal properties 5 producing 2 development 16 evaluation 34 exploration 15 base metal and pota
Slide 16: Accretive Transaction – Relative Contribution
Accretive Transaction – Relative Contribution Market Value 1 87% 13% CY 2007 Revenue 2 82% 18% Additional Mineralized Material 80% 20% Gold Equiv. Ozs 3,4,5 PP Reserves Gold Equiv. Ozs 3,4,5 59% 41% Producing and Development 66% 34% Properties Exploration and Evaluation Properties 30% 70% 0% 20% 40%
Slide 17: Restructuring of Cortez
fi ROVALGOLDING The Leading Precious Metal Royatty Company Restructuring of Cortez 17
Slide 18: Cortez Crossroads Rationalization
Cortez Crossroads Rationalization Current Royalty Structure Restructuring Crossroads royalties PRICE OF GOLD GSR1 GSR2 Below $210 0.40% 0.72% Unlocks value for Barrick and Royal Gold $210 - $229.99 0.50% 0.90% Should accelerate Crossroads development schedule $230 - $249.99 0.75% 1.35% $250 - $269.9
Slide 19: Cortez Crossroads Rationalization
Cortez Crossroads Rationalization Future Royalty Structure Restructuring Crossroads royalties PRICE OF GOLD GSR1 and 2 Below $210 0.40% Unlocks value for Barrick and Royal Gold $210 - $229.99 0.50% Should accelerate Crossroads development schedule $230 - $249.99 0.75% $250 - $269.99 1.30% Royalty co
Slide 20: Current Royalty Interest
Ik ROYAL GOL] ING The Leading Precious Metals Royalty Company Current Royalty Interest 20
Slide 21: GSR2 Royalty Restructured
GSR2 Royalty Restructured 1 1 Effectively eliminates GSR2 and expands GSR1 footprint. 21
Slide 22: GSR3 Royalty Restructured
GSR3 Royalty Restructured 22
Slide 23: NVR1 Royalty Restructured
NVR1 Royalty Restructured 23
Slide 24: Restructured Royalty Interests at Cortez
Restructured Royalty Interests at Cortez (Pipeline Mining Complex) 24
Slide 25: Key Asset Review
fa ROYVALGOLIING The Leading Precious Metal Royatty Company Key Asset Review 25
Slide 26: Core Producing Properties
Core Producing Properties Cortez (Pipeline Mining Leeville Mining Complex) Robinson Taparko Complex Barrick Quadra High River Newmont Est. CY 2008 Production 367,000 oz (Au) 115,000 oz (Au) 30,000 oz (Au) 415,000 oz (Au) 150M lbs (Cu) FY’08 Revenue $22.0M $16.6M $7.4M $5.6M Reserves 1.9M oz (Au) 0.8
Slide 27: Core Producing Properties
Core Producing Properties Goldstrike Siguiri (SJ Claims) Mulatos Mt. Goode AngloGold Ashanti Barrick Alamos Gold Xstrata Est. CY 2008 Production 358,000 oz (Au) 1 792,000 oz (Au) 120,000 oz (Au) 2 FY’08 Revenue $5.2M 3,4 $5.1M $5.0M 5 $1.9M 3 Reserves 2.6M oz (Au) 6 7.0M oz (Au) 1.7M oz (Au) 117M lb
Slide 28: Taparko – Status
Taparko – Status Investment: $35 million Royalty revenue received (as of 6/30/08): $7.4M Operational issues: Grade is meeting expectation Recovery greater than 90% Production status Royal Gold’s security 28
Slide 29: Core Development and Evaluation Properties
Core Development and Evaluation Properties Peñasquito 1 Dolores Pascua-Lama Goldcorp Minefinders Barrick Est. CY 2008 Production 67,000 oz (Au) 10-15,000 oz (Au) 2.2M oz (Ag) 350-375,000 oz (Ag) - Reserves 13.1M oz (Au) 2.4M oz (Au) 14.6M oz (Au)2 863.9M oz (Ag) 126.6M oz (Ag) Additional 13.6M oz (A
Slide 30: Core Development and Evaluation Properties
Core Development and Evaluation Properties Crossroads Malartic 1 Holt-Holloway 2 Barrick Osisko St Andrew Goldfields Est. CY’08 Production - - - Reserves - - 0.5M oz (Au) 3 Additional 1.1M oz (Au) 8.4M oz (Au) 3 0.5M oz (Au) 3 Mineralized Material 4 Est. Production Post 2010 Post 2010 Start-up Post
Slide 31: Peñasquito – Status
Peñasquito – Status Construction on schedule: Oxide circuit operational Phase I of sulfide circuit - end of CY 2009 Phase II of sulfide circuit - end of CY 2010 3,000 Annual Production - Gold Equiv. ( koz ) Project upside: 2,500 2,000 Exploration ongoing 1,500 Potential metallurgical 1,000 enhanceme
Slide 32: Dolores – Status
Dolores – Status Construction of all critical processing facilities complete Solution application applied October 2008 Gold and silver production expected by mid November 32
Slide 33: Development Pipeline
Development Pipeline 1 EXPLORATION EVALUATION DEVELOPMENT DEVELOPMENT CONSTRUCTION PRODUCTION Peñasquito – Oxide (2008) Benso (2008) Twin Creeks (2008) Taparko (2008) Dolores (2008) Peñasquito – Sulfide I (2009) Peñasquito – Sulfide II (2010) Marigold (2010) Gold Hill Pascua-Lama Post-2010 Holt-Holl
Slide 34: Summary
Summary Strong track record of growth Expanded portfolio of producing properties Robust pipeline of development properties Positioned well for future growth 34
Slide 35: ROYAL GOLD, INC.
ROYAL GOLD, INC. 1660 Wynkoop Street Denver, CO 80202-1132 PHONE 303.573.1660 FAX 303.595.9385 EMAIL info@royalgold.com WEB www.royalgold.com
Slide 36: Appendix
fa ROVALGO LING The Leading Precious Metal Royatty Company Appendix 36
Slide 37: Company Profile
Company Profile Stock Symbol: NASDAQ:RGLD; TSX:RGL Shares Outstanding: Common 33.9M Dividend Yield1: 0.84% Dividend Payout Ratio2: 28% (fully diluted – 34.7M) $0.35 $0.32 $0.28 $0.30 $0.26 Market Cap (11/24/08): $1.3B $0.25 $0.20 $0.22 $0.20 $0.15 Average Volume (TTM): 571,000 $0.10 $0.05 $0.00 Insi
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