Royal Gold, Inc. · NASDAQ:RGLD
Royal Gold — European Gold Forum April 2004
28 slides from Royal Gold's conference presentation, Apr 23, 2004
Slide 1: Royal Gold, Inc. A Precious Metals Royalty Company
ROYAL GOLD, INC. A Precious Metals Royalty Company European Gold Forum April 2004
Slide 2: Safe Harbor
Safe Harbor CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Some matters contained in this presentation are forward-looking statements that involve risks and uncertainties that could cause actual events to differ materially from projections or estimates. Such forward-
Slide 3: Royal Gold: A Different Way To Own Gold
Royal Gold A Different Way To Own Gold
Slide 4: Solid Growth ~ Solid Future
Solid Growth ~ Solid Future ($ Millions) - -4.3 5.0 2.7 8.8 11.2 Free Cash Flow FY 1999-2003 1.0 9.4 6.0 12.3 15.8 Royalty Revenues FY 1999-2003
Slide 5: Royal Gold ~ Highlights
Royal Gold ~ Highlights Leading publicly-traded precious metals royalty company Royalties on flagship properties of the three largest gold producers in North America Leverage to gold prices through sliding-scale royalties Working with world-class operators
Slide 6: Market Profile
Market Profile NASDAQ RGLD TSX RGL Shares outstanding 20.8 million (fully diluted) 21.1 million Market cap over $350 million Trading volume 524,000 shares/day Options traded CBOE, AMEX, PACIFIC & ISE
Slide 7: A Royalty Company ~ A Unique Investment
A Royalty Company ~ A Unique Investment No direct construction costs or capital outlays No operating or environmental risks Higher margins than operators High stock market multiples
Slide 8: A Royalty Company ~ A Unique Investment
A Royalty Company ~ A Unique Investment Exposure to reserve additions Efficient corporate structure Tax advantaged income
Slide 9: Management ~ Significant Ownership Stake
Management ~ Significant Ownership Stake Retail 47% Management & Directors 21% Institutional 32%
Slide 10: Dividends ~ Steady and Growing
Dividends ~ Steady and Growing 0.05 0.05 0.075 0.10 0.15 2000 2001 2002 2003 2004 ($ per share)
Slide 11: Producing Royalty Portfolio
Producing Royalty Portfolio NAME/ROYALTY TYPE OPERATOR Pipeline Mining Complex (GSR and NVR) Placer Dome Leeville (NSR) Newmont SJ Claims (NSR) Barrick Bald Mountain (NSR) Placer Dome Martha mine (NSR) Coeur d'Alene
Slide 12: Pipeline Mining Complex ~ GSR Sliding-Scale Royalties
Pipeline Mining Complex ~ GSR Sliding-Scale Royalties 9.00% 5.00% $470 and above 8.55% 4.75% $450 - $469.99 8.10% 4.50% $430 - $449.99 7.65% 4.25% $410 - $429.99 7.20% 4.00% $390 - $409.99 6.75% 3.75% $370 - $389.99 6.12% 3.40% $350 - $369.99 5.40% 3.00% $330 - $349.99 4.68% 2.60% $310 - $329.99 4.0
Slide 13: The Power of Leverage
The Power of Leverage Pipeline Project - GSR1 Leverage Royalty Revenue Per Gold Ounce Produced 5.00 10.00 15.00 20.00 25.00 30.00 350 450 Gold Price ($/Ounce) 30% 80% Revenue per Ounce ($) $11.90 $21.38
Slide 14: Royal Gold's Gold Price Leverage
Royal Gold's Gold Price Leverage Royal Gold Calendar 2004 Revenues and Free Cash Flow Projections 7.0 12.1 16.2 21.4 25.2 11.0 16.3 20.8 26.4 30.4 300 350 400 450 500 Gold Price ($) ($ In Millions) Free Cash Flows Revenues Revenue and free cash flow projections are calculated based on production est
Slide 15: Poised for Significant Growth
Poised for Significant Growth $41M cash No debt $10M line of credit Shelf registration
Slide 16: Pipeline Mining Complex (Operated by Placer Dome)
Pipeline Mining Complex (Operated by Placer Dome) Four different royalty streams 6.0 million ounces of reserves Additional mineralization of 176.5 million tons @ 0.033 opt (160.1 million tonnes @ 1.13 gpt) Estimated production of 892,000 ounces for calendar 2004 New picture/photo
Slide 17: Pipeline Mining Complex (Operated by Placer Dome)
Pipeline Mining Complex (Operated by Placer Dome)
Slide 18: Mineral Endowment ~ Reserve Replacement
Pipeline Mining Complex (Operated by Placer Dome) Mineral Endowment ~ Reserve Replacement Ounces in Millions 2 4 6 8 10 12 14 16 18 20 1997 1998 1999 2000 2001 2002 2003 Reserves Resources Cumulative Production
Slide 19: Leeville Project (Operated by Newmont)
Leeville Project (Operated by Newmont) 1.8% NSR royalty 2.6 million ounces of reserves Carlin East 146,000 ounces Leeville 2.5 million ounces Additional mineralization of 1.5 million tons @ 0.453 opt (1.36 million tonnes @ 15.53 gpt) (Leeville)
Slide 20: Leeville Project: Estimated Production
Leeville Project (Operated by Newmont) Estimated production 116,000 ounces in calendar 2004 (Carlin East) 550,000 ounces/year commencing in late 2005 (Leeville)
Slide 21: Leeville Project: Development Drift Advance
Development Drift Advance Leeville Project (Operated by Newmont) Well-positioned for additional exploration potential between Carlin East and Leeville
Slide 22: SJ Claims ~ Betze-Post Mine (Operated by Barrick)
SJ Claims ~ Betze-Post Mine (Operated by Barrick) 0.9% NSR royalty 9.8 million ounces of reserves Estimated production 515,000 ounces in calendar 2004 SJ Claims Royalty Footprint
Slide 23: SJ Claims Royalty Footprint ~ Betze-Post Mine
SJ Claims Royalty Footprint ~ Betze-Post Mine (Operated by Barrick) Positioned for Betze- Post expansion Solid royalty income for years to come Emphasis on exploration by operator
Slide 24: Bald Mountain (Operated by Placer Dome)
1.75% - 3.5% NSR sliding- scale royalty 320,000 ounces of reserves Additional mineralization of 7.7 million tons @ 0.037 opt (7.0 million tonnes @ 1.27 gpt) Estimated production of 55,000 ounces in calendar 2004 Bald Mountain (Operated by Placer Dome)
Slide 25: Martha Silver Mine (Operated by Coeur d'Alene)
Martha Silver Mine (Operated by Coeur d'Alene) 2% NSR royalty 1.35 million ounces of reserves Additional mineralization of 24,000 tons @ 78.43 opt (21,770 tonnes @ 2,688.0 gpt) Estimated production of 1.3 million ounces in calendar 2004 Upside exploration potential Martha Mine
Slide 26: Focused Growth Strategy
Focused Growth Strategy Acquisition of existing royalties Innovative royalty financing transactions, including: Exploration Feasibility studies Mine construction/development loan guarantees Reclamation Other project financing needs Restructuring balance sheets
Slide 27: Designed to Offer A Premium Investment
Royal Gold ~ Designed to Offer A Premium Investment Superior leverage to rising gold prices Low operational risk Efficient business plan yielding excellent margins Financial strength to fuel growth
Slide 28: Royal Gold, Inc.
Royal Gold, Inc. 1660 Wynkoop Street, Suite 1000 Denver, Colorado 80202-1132 U.S.A. www.royalgold.com Telephone: (303) 573-1660 Fax: (303) 595-9385