Gold Royalty (GROY) 5 Nov 242024 Q3 Earnings call transcript

Welcome to the Gold Royalty Corp.

Third Quarter 2024 Results Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to David Garofalo, Chairman and CEO. Please go ahead.

operator. you, Thank and ladies Good gentlemen. morning, Thank you our call review in quarter participating XXXX today's third results. to for Please note the for presentation those format. not currently on conference our in is of accompanying the call available page on Presentations website PDF this webcast, a

on includes the will call important will cautionary commentary and X of include review everyone notes. to Some Slide statements, the I today's of forward-looking direct presentation, which

Markets. Przybylowski, Andrew me Gubbels, will Chief Vice on President, and Officer; alongside Capital Speaking be Jackie today's Financial call

of an marks point the quarter inflection third The company. XXXX for important

Our in of total outlook have and record ending assets land revenue, million portfolio. continues the to months $XX grow increasingly and $XX million. expected to XXXX, achieved construction across reiterated agreement positive proceeds with our We revenues ramp-up X XX, key for full the of year interest several September for our guidance

outlook be and Andrew I cost as assets, the to commodity Gubbels prices the We third and cash call the of quarter X. will translate to continue growing our with about to flowing on stable for results year. With details to over that, more flows expected next Slide to strong XXXX our pass excited discuss well cash structure, revenues

of the the in million. million over of proceeds financial and for David, interest and comparable XXXX, quarter. land year-to-date and and morning, we We $X agreement to you, operating year-to-date the in performance of quarter a maintained increase cash to XXXX total million below $X land record third $X.X everyone. Thank XX% a period relative with expenses we during cash million, agreement against XXX% achieved revenue, had good $X.X quarter of strong the basis, and expenses have operating and revenue, On total a proceeds interest, increase stable relative

to agreement credited $X.X million year-to-date, properties. track of against first by land flow operations cash from cash we're of our proceeds of million activities which with As a excludes $X.X year positive on provided deliver result, operating mineral

reported asset, also acquired positive of allow tax the on net burden pay reduced amalgamating the quarter administrative deferred a entities, in an tax after reorganization following By income of utilization and stand-alone fulsome recognizing utilize tax the Royalty to the we noncash deferred driver more our for losses of basis, previously ability which Corp. subsidiaries. from the a The built-up We our internal future Canadian certain each primary $X.X tax million a consolidated to company's certain asset attributes. savings consolidated Malartic Gold tax from entity. shelter the of within assets, tax predominantly producing earnings company's is

revenue Ontario, end on expect $XX is Vares by of in fourth Gold the from track capacity land XXX% to in by maintained growth in IAMGOLD and the towards Bosnia, targeted further we end to ahead, fourth to copper to nameplate Primary strong the expect initial quarter saw third the of at drivers production. the interest will continued have the the in Looking a we expect production continued our see stream Cote the in quarter million guidance quarter revenue ramp-up as Vares, to and revenue, receive production of nameplate proceeds Mine the the increases for be of year mine's the At Vares by our progresses XXXX. year. million year. expected have achieve on fourth of quarter in of and our by $XX Cote operated Mine IAMGOLD, and fourth agreement the quarter growth operated Metals. We Adriatic total

along discuss across growth these year these revenue see to other presentation. assets we as in expect operational catalysts in portfolio Jackie We the from full with updates later production. of benefit full from our XXXX will both a

million $XX to revenue midpoint proceeds agreement we fourth X. represents my Again, an year $XX full expected Slide comments, of Canadian existing as flowing and continue quarter $X and total contributions land expect interest million be by as XXXX. Reiterating $X our relative revenue, Malartic, Cote from and million revenue well of at XXX% initial prior cash payments increase to Borborema. driven of continued Borden, the to royalties revenue at will our to million, interest which increased Cozamin from pre-production from to and Vares Moving of revenue

in to call portfolio pass the discuss the to I'll Now more Jackie. detail,

Thanks, Andrew.

and Cote to Gold discussing tonnes of our ore in Adriatic, X, third with the the Vares, revenue the the XX,XXX recognizing upon October. in streaming third Mine production revenue and the storms and hence, and Slide from minutes spend fourth Severe a ramp-up few of Herzegovina were Mine. the hit Due I'll agreement Turning until early Vares mined our physical the despite of Vares copper, of having flooding Gold nature At occurred quarter. sale quarter. delivery in to recognizes Royalty subsequent lag Bosnia the in quarter

was is While commenced that XXXX will required. At connects until XXth. On line processing XX% by per XXth, guidance performance day the road the to been October its on of facility will has and was damaged improvements design achieved ounces has of were that in third the tailings Cote plant was day. key and XXX,XXX and to the to made ready September in of the XX,XXX tonnes processing line and optimizations be per has December ramp-up maintained reported concentrate throughput, production throughput also record at is of before is scheduled and when mined plant Adriatic production IAMGOLD mined. granted the which the gold tonnes October plant has repaired. Adriatic subsequent Cote, quarter that of XXXX XXX,XXX which remains [indiscernible] the storage tonnes facility Metals is improve of Veovaca. and production the the at and all use a shutdown equating October nameplate X at Xnd, availability plant. Since Phase unaffected, exit Construction trucked per in to be completed averaged design, gold tailings on its Sarajevo to to of railway tonnes tonnes XX,XXX throughput, outlined railway track XX% the permits day daily of XX,XXX XXX,XXX year which for XX,XXX of the XXXX, has guidance shutdown, the storage

the to full of end a on IAMGOLD meet the XXXX, For it guidance on gold ounces said remains basis. its lower XXX,XXX year XXX,XXX track production of has of to XXX%

Moving to X. Slide

royalty, other gold both shaft key We where across Agnico have continue and X% At development on ramp Eagle's mine, schedule. several positive holds the portfolio. catalysts royalty NSR a Odyssey

into North mine also infrastructure Minerals's mineral the be the at Aura of future. At support Additional positive additional using and Odyssey new and drill infrastructure South gold-linked and which and to royalty results internal advancing production mineral a Borborema project development existing the Gold could driver in reserves resources early which to is Royalty construction for could holds brought is add next of at be potential royalty demonstrated in year. on a Gold X% project and loan, convertible Brazil, where incremental zones, Royalty expected for initial growth XXXX, production well NSR a track is

NSR right project, at life Silver's royalty mine acquire Royalty's life royalty a an equivalent to which a NSR the an NSR outlines Pearl of indicated expected the deeper X-year hosts mine, inferred to economic Inc.'s Moving smaller indicated in where Gold Gold finally, equivalent X% the a regulatory royalties, outlines was Tonopah Isabella mineral Gold These significant X.XXX% resources. The production resources. where are to project, received. mine gold in Isabella of were mine total over Royalty West which life. of holds X.X producing published, and X% Blackrock million Whistler million of permits further result estimate mine silver an the Gold holds ounces and Royalty half of ounces. At an was published preliminary royalty, ounces southern one Fortitude XX.X pit. And for holds X.XX% to U.S. project, X.X royalty, the additional and of project million growth Gold's now gold assessment NSR Pearl a resource of GoldMining equivalent Royalty updated a resources extension

beyond, price environment is consensus XXXX. Further, production commodity million $XX cash exciting we in current We're increase meaningful free the on to Gold point robust million Slide Moving a well and of X. and cash to see estimates. We pipeline in our of revenue to in streams GEO the outlined a $XX GEO this in an XXXX with X. at growth in gold trajectory to our as flows see Royalty expected decade. Supporting operating strong the to Gold as is price, million flow $X through royalties inflection leverage from the the can revenue on XXXX production. of profile coupled Slide Royalty's and This, company positive to end and growth strong our revenue as supports long-term for

mining jurisdictions favorable assets Our well-capitalized collection royalties partners. established features of operating located in high-quality with and

REN, our seen pipeline, royalties We development of Creek Railroad excited see coming cash number such move the in flowing in and are from cash we the flowing as years. and South to Granite to have recently increase assets

XX, Slide near, we the key through term. XXX Royalty medium few of a Gold across will that longer can value be driving walk royalties catalysts to the our in Moving for and

over in X the initial holds production at Borborema, next see be we into and Royalty Pearl. plans excited the Line medium the County production addition the Line which Gold touched to Over from Fortitude the X% the months, ramp-ups County of I've royalty term, NSR incorporation to previously. In will at are on Cote a key Vares drivers Gold's project. Isabella

small a the While ounces to to gold rate potential to XX,XXX profile. solid per our be of the contribution revenue large year, with royalty mine relatively a produce XX,XXX would

to medium the we is at XXXX represent XXXX. the mine. Odyssey, expected is to to to see underground underground the expect brings ramp interest production appointed operation, holds up we Granite North time. are see as Canadian Creek Granite from Odyssey deliver that CEO. when over the as Malartic Malartic underground underneath coming catalysts zones, Young Agnico at Beyond operating Odyssey deposits to Royalty deliver potential would an the net and pedigree and that Canadian to the Malartic tremendous shift profile the long-term. area, Gold a upside County coverage to profit to Line, the underground rates project. which royalty i-XX and exciting mine, between in The team increased full excited watch Odyssey our important company, are He over mining Creek at and Gold a production Richard asset will internal the Eagle attributable extension be recently years. And XX% to plans now of East

significant MD&A the as well. I'll our catalysts, and exploration Gold of portfolio, production to across Railroad This towards and will up at Royalty through meaningful partners David property. coming Another South the initial construction of permitting, South portion expecting development summarizes Orla's before in summarize longer-term production adding investments X.X% numerous outlined the Railroad to is Gold the will on our of years. where be X.XX% questions. a shortly the operating some Royalty NSR in driver made be thereafter. longer-term which a production Nevada, now growth the move catalyst Orla which highlight by and study XXXX XXX for the are pass back royalties over other to this Gold Nevada into catalyst holds NSR a from key over advancement where our royalty a the decade. This With NPI project drivers and growth, XXXX. And being of are currently to call for last is project Royalty of business finally, Garofalo with expected by REN holds of to Mines's is opening and X.X% Gold end value there pre-feasibility royalties over our the within

Jackie. Thanks,

our valuation see, As started be a flow are we free that robust exciting can Until happy flow move the high-quality and capital Gold we in of inflection of confident an long-life, foundation cash in be then, of In disciplined our most towards growth strategy. you extremely are frustrating, fundamentally important ] a time growing re-rating organic share our an on the profile We've cash the a Royalty And business allocation current free while shareholder. strong, sound we already will assets. have is company closing, to one to in built point. sector pipelines price. the this result [ is a have to of

paying up to be down call credit Our our top priority facility I'd open Operator? is revolving for and adding sheet that, cash the flows balance our to the happy liquidity. With Q&A. to growing

question comes today's Wainwright. with Ihle And first Instructions] H.C. from [Operator Heiko

invest call a portfolio? It's mean, I last is I that $XXX impact pretty higher XX%. up the more gold on that's months in question, expected, mean, of operators it, is the XX probably you question. And price you building the ago? obvious than year, X, do on gold see what your XX,

get moment, illustrates in question, few price, impact on terms will line to that #X a Peter the Slide better in nothing there's that in well. terms as that is Yes, dimensions in crystallizes we interject on gold on today [ of I of But cash the Behncke and a the Jackie ] presentation the to than impact and provided flow. the or

Our of about the leverage the per quite production million is north right gold through per growing [ gold at on prices, annum. current as significantly basis grows rate end and the decade, an attributable decade. use immense the to at And XX% of exit if the us annum ] you of of price $XX of we revenue volume average only to consensus a compounded

in the you $X,XXX If you an see can approach ounce, to mid-XXs. starts use it

our gold to gearing of increasing significant So volumes. result as a price the

expansion to expenditures royalties of their a you'd acquisition on. terms in the only model On success add of dimension is as And and we part their underlying the back ounces XXX deposits exploration of their March million average, a operators, our and on million over have result to the XXXX of efforts, operators. $XXX exposure Peter, Jackie, our of to that's operators question ] base, that underlying other anything we but in XX X that? of the date that over our when to resource over the the IPO-ed operating on have years, grown well, has last million ounces invested about assets. not in exploration ground exploration partners in have [ the underlying we plans from of to like our the The the was ounces key leverage your as of our

several independent of other from production metals gold They're key said Thanks, such the and Dave. where particularly producing now mean, prices. But in. just of development portfolio, almost in jump have, portfolio we or phase. already that our at assets producing assets will having assets some as in production higher benefit the the that in that I'll grow I'll our point gold could Vares, I or of they're near prices. ramp-up and the Cote that, mention

would ore example, would royalty the likely For accelerated accelerated Agnico on our from royalty or strategy, the our of mill mine be from Eagle's filled fill that benefit shaft second mill Odyssey from mined a sinking lands. assuming

real prices. Other also potentially current a gold could development into be brought stage benefit would from that earlier. assets So to production be us high

as However, in first South Line, contingent and as about is as as you the accelerated examples studies. permitting know, Heiko, excited development. at development initial could things timing well Granite ramp-up as or REN we're often of Creek, be at County on various that production production things such And of Railroad

with I want think Peter. Dave, if leave I'll you -- it up or unless follow to anything there, else,

question. I think take we can next the

regards said? M&A kind -- you on mean, just back I a asking transactions, they what in queue. your are that, volumes, Building what pipeline, seeing were. With of in to or Okay. corporate bit the prior what than you in answer pipeline, prices are prices quite development given you given your seeing I'll What question, that the to get higher stuff? are asset

Yes. that I left less has equity the ] junior would Look, what is in participation. more say terms market behind or [ of market been

you're more would happened. equity responded would the the actually to the about broadly, up expect you the buying you is gold get this seen to price. gold the of We the price The juniors, That not underperformed XX% would and GDXJ hasn't to and year the GDX gold commodities, what have gold way when haven't they leverage in equities but only I response, price say not kind haven't think.

capital exploration of means simply what juniors So to conduct to haven't is had development the the access that markets many meaningful or activities.

And lot those inbounds getting that. of so a as a we're result of

generative things. of lot earlier-stage we those frankly, our effectively appeal a us through for see ] opportunities we to [ because are free program. So But generate those royalties limited

assets have financing or lot to of appeal financing early-stage stage doing early-stage really So exploration us. of a doesn't

the quite for what currency. financing, We our do in of third-party weakness limited given we We're opportunities very terms can a have seen royalties. few in

as has then, extremely do quite to to currency years, currency currency is the The portfolio. dramatically abandoned of our you We had have for market to pace think the we so. Since early portfolio when we the XXXX, that be the we aggressive when accumulating of in we our the can over course X that slowed were value expanding really attributed and last see intrinsic disciplined. us. in acquisition hasn't Waiting to And crystallize. growth the our had

hands And being to of our extremely time So assets, the the on underlying disciplined. intrinsic we're recognizes be going our until market if for value we to sit have the the we'll pay ] down capital debt to and in we'll do at course, shareholders in on and basis. then harvest the a so, value, look [ returns sustainable hopefully, cash due flow,

question Scotiabank. next our today And Winmill with comes from Eric

Canyon missed there I on terms hearing about in but if anything Apologies of we updates think it, we forward? modeling any should be or you're looking that at, should Jerritt going

can over Andrew, like? hand that I you, if to you'd

Yes, sure.

of terms that as our of down sheet had Jerritt the some investment on we recall our Canyon well. in Jerritt In you'll line peers with Canyon, written balance

being -- a for discussed of potentially balance that royalty skinnier we've result a or a potential prices one that as it's was from for got by it's was and the -- own, value benefits of of a to challenges that So from gold the margins had higher we valuation some we're said, David these is and assets Jackie by back. that raised come earlier off-line went book but a not the one certainly perspective. perspective, That of sheet still

operating Majestic a one we is keep and them. of to First good respect Now, dialogue our partners with

with more are Canyon. we prices what where of line aware time it a prospects at, the going potential not future We encouraged around forward. gold be for they're of with could But the are Jerritt

we short is where with changed that the to Canyon, the prices So there is our gold are Jerritt potential answer potentially around estimates in more but relevance -- future. for have haven't internal to

in of lot and sentiment Maybe if share Appreciate more to the you've just don't disconnect, seems be there, particular the is gold But for terms one maybe you really would dollars I side, see There discovery in. new certainly portfolio, assets Great. a mind. for a me, that. great of missing you here. road? exploration market's where obviously, flowing on be the greatest exploration that assets given there the down right, exploration should the think here maybe potential But the got that or in you now, any

Yes, I'll to hand who's question. as excellent Peter, the over well. that on Peter? phone

assets Whistler X.X Dave. million to That's large-scale the of highlighted a Thanks, resources royalty, over the we project the build And Eric, Yes. of earlier in but entire over developments nearly a recent up relatively one and some total where doubled in exploration jurisdiction. encouraging. Alaska, of at now been that work, have a inferred, continuing project. I'll have NSR large have indicated, on advancing, good Jackie ounces a encouraging doubled completing there, in the They've presentation, or They're studies. million and very could resource indicated X.XX% project we the that X over very

to the royalty at gold longer-dated mix be property generator that and we advanced They X% have stage of there, exploration other through earlier was in emphasize results. also And the a royalty Tonopah entire Tonopah and Nevada. large NSR I'd silver project this or recent within model. their then West since that created very our had year a the highlight have over deposit. And published PEA The West very encouraging developments would asset

of example we'll great We project a that advance then earlier million it. towards creating year years. coming on in option $X this royalty, production the got paid us payment for see getting it a So and

costs return strong rates the associated Tonopah. low like with given generating So very very of royalties

question next Kerry our today And Securities. Haywood from comes Smith of

the could final just then? you when pricing there's from. for I how payment payment, Is lag benefit When get assume it's this Dave, ship, with on final that sales concentrate concentrate Vares, sold. get actually one it actually works no that you before actually provisional you then

Andrew. to hand it over I'll

David. No, that Yes, Yes. how Kerry, it is thanks, works.

on is as the XX need copper of And to shipped. within we payment. there a be tonnes for will requirement per ongoing Just the get first a certain basis, that payments then contract, amount concentrate is an to at least shipped. We get

for until the at point for where are no So threshold. -- threshold, There's get agreement, involved. royalty, provisional but we're they payment stream we the pricing reach that first they reaching don't the that that or not

Okay.

is And and that getting so, it have contained QX, they works? for how concentrate start then paid? to of tonnes to Is -- get XX that you before copper

yes. right, That's

lag Okay. trying -- might to know -- the then assume production into kind you X-month how of going might it actually longer get Is this that QX work would much QX then -- -- XXXX it production you would it a out what than say be to have quarter. kind at And to rough reasonable there's months? that's And on you figure a in of So kind lag and do payments? revenue that I'm how be QX? if do have steady you'll XXXX, concentrate just X would state? have you'd in of scale-up Or paid because

question. good a It's

In net It's year, of I the [ a revenue lag rest -- getting about based ] that of in think I of on and also terms [ -- ] [ up scheduled X/X we how we us the out. ramp-up to around function -- and ] per potentially. production could have them just or achieving the for potentially line worth $X the shipments that less and se will they million It's sight the catch see in can than the profile, shipments X ramp quickly so. of mean, terms up. of depends we've on it guess up of lag,

this So months a or our circa so do estimates. built into X stage, we have of as lag

of million Andrew? you'll that's what in suggesting, you're thinking revenue, what Is QX? $X that roughly that get you're And Okay.

yes. objectives, Contingent the on the copper -- and prices Yes. ramp-up their then achieving

Got you.

to take the plan in go-forward that of would to it a on assume what feel your you -- to helpful. like debt could? the that that you the is introductory get company level Okay. from debt level today as to preamble do remarks, for of you'd And you or down that a that's most the proper be cash That's soon to if paid basis down flow the use from pay case, you is David, kind And to and that as your free fair the think comments reasonable? then

is we Yes. think a It's money, priority get to with strike us. [ very in $X.XX. revolver down consider the before nil by of of price attractive less for a paper. medium capital I is Look, a X X-year effectively the It's returns term of our actually short unsecured, us to ] to of shareholders. convertible years The after piece callable concern

pre-occupation when less So attractive acquisition to opportunities -- our attractively to we'd use of us acquisitions. other revolver available a currency to valued have a But rather enough for us. for is further for enough consider

quickly our So card debt really, as to as want and down that's we possible. card, pay like a credit credit

you. Got

That's helpful. Okay.

just Kerry, circa. -- correction a make or I'll over million a said on $X.X so $X.X $X Can million million the Vares sorry, from little I I Circa, $X timing. just based there. or million,

I sorry, -- So there. misspoke

it. Okay. That's good. Appreciate

[Operator Instructions] ], Brent Our comes investor. private question [ a Robert next from

add in any [ the it XXXX, downtick. a can that slight color bit flow give cash that of on color you a or Slide of where pause ] very Particularly can you cash 'XX about particular stops around flow. around any 'XX? maybe years -- growth, there just significant but 'XX Is little a X, color Just shows X me

Jackie, I'll want try? off do hand Jackie it to to Peter. and/or you

Sure. Dave. Thanks,

be slide, there's higher estimates that of when This mean, average So of of on and includes are uncertainty the date. these cover to I all, go Generally, is from are the sort current X their I'll us. you expectations. just highlight analysts the conservative longer that analyst uncertainty first going more higher that the

think just little XXXX underground. I XXXX -- Malartic the part that around conservatism have Canadian includes growth between be would do more We So and the consensus bit a the of expectations.

Cote. contributes first mining, think our phase to growth the that that. off and about tends the is XXXX also XXXX over that the is to really in with with years attached I that trail royalty so, that the mining point. And stabilizing of after to I of of to highlight period, X of sort And at would then associated reduction Most

reduction could in contribution And period. some so that we see same the Cote of around

consensus I why the those of that we're in XXXX. down to seeing would expectation think So be slightly flat drivers biggest

Okay. congratulations quarter a there. that good I on color, and appreciate

concludes session. turn Thank I'd conference you. back remarks. like And over this team any management to final our question-and-answer the the for to

thank kind Well, your for everybody, you, today. attention

jackiep@goldroyalty.com. to Joined in Of take questions. you of phone. can new And to course, it's to of to with we'd you'd of VP delighted Jackie X-XXX investor remember organization, look hesitate your can reach next please don't reach is course, one you our inquiries. us by it's But thank and kind forward to quarter. today out, talking Capital and the to e-mail, any you dealing call terms by Markets. us in if our number be person of attention e-mail, September, for And she's you easy like and point to speak your her in-person. to But

We you, all, thank today's This attending call. conference presentation. concludes you, Thank today's for sir.

wonderful now You your lines, have disconnect may a day. and