Financial Data and Key Metrics Changes - The company achieved record earnings of $132 million or $2.1 per share for the quarter, with adjusted earnings of $119 million or $1.81 per share after accounting for discrete tax items [5][6][22] - Revenue for the quarter was a record $210 million, up 20% year-over-year, driven by a 40% increase in gold prices [19][22] - The adjusted EBITDA margin increased to 84% due to strong gold prices and stable cash G&A [6][19] - The company remains debt-free and paid a quarterly dividend of $0.45 per share [6][24] Business Line Data and Key Metrics Changes - Royalty revenue increased by about 50% year-over-year to $77 million, with strong contributions from Penasquito and Mancho [12] - Stream segment revenue was $133 million, up 8% from the previous year, with increased sales from Mount Milligan and Pueblo Viejo [12] - The overall volume was 63,900 GEOs for the quarter, contributing to the record revenue [12] Market Data and Key Metrics Changes - Gold accounted for approximately 78% of total revenue, followed by silver at 11% and copper at 7% [20] - Metal prices were a significant driver for revenue increase, with gold up 40% and silver up 17% year-over-year [19][20] Company Strategy and Development Direction - The company is positioning itself as a premier growth company through acquisitions of Sandstorm Gold and Horizon Copper, which will enhance scale, growth, and diversification [7][8] - The strategic focus remains on growth in precious metals, maintaining a strong balance sheet, and increasing dividends [9] - Recent acquisitions include a gold stream on the Kansanshi mine in Zambia, a stream and royalty interest on the Wurinza project in Ecuador, and a royalty on the Lawyers Ranch development project in British Columbia [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in closing the Sandstorm and Horizon transactions by the fourth quarter, with constructive engagement from investors [28][29] - The company is comfortable maintaining its 2025 guidance range despite underperformance in some key assets, due to a rigorous risk-adjusted budgeting process [41] - Management acknowledged the political volatility in African jurisdictions but remains open to further investments in countries where they have had success [45][46] Other Important Information - The company expects to receive the first delivery of deferred gold consideration from the Mount Milligan cost support agreement in late third quarter or early fourth quarter [26] - The total liquidity grew to over $1.25 billion, including a fully undrawn revolving credit facility of $1 billion [24] Q&A Session Summary Question: Can you discuss the deleveraging goal post-transactions? - Management indicated that the plan is to use excess cash flow to pay down the revolver over time, balancing this with potential investment opportunities [31][32] Question: Regarding Milligan's reduced production guidance, how does this affect your 2025 guidance? - Management explained that they maintain their guidance due to a rigorous budgeting process that incorporates historical performance and risk adjustments [36][41] Question: Are you maxed out on African exposure with the Kansanshi acquisition? - Management stated they are comfortable with their current African investments and would consider additional opportunities if the countries are deemed stable [44][46] Question: Is there any consideration for a share buyback given recent share performance? - Management emphasized that the focus will be on debt repayment before considering a buyback [48] Question: Can you provide an update on the timing of the Sandstorm transaction? - Management confirmed they will file the preliminary proxy with the SEC soon, targeting a fourth-quarter closing [51][52]

Financial Data and Key Metrics Changes - The company reported record earnings of $132 million or $2.1 per share for Q2 2025, with adjusted earnings of $119 million or $1.81 per share after accounting for discrete tax items [5][20] - Revenue reached a record $210 million, up 20% year-over-year, driven by a 40% increase in gold prices [11][17] - Adjusted EBITDA margin increased to 84% due to strong gold prices and stable cash G&A [6][20] - Operating cash flow also set a record at $153 million, significantly up from $114 million in the prior year [21] Business Line Data and Key Metrics Changes - Royalty revenue increased by about 50% year-over-year to $77 million, with strong contributions from Penasquito and Mancho [11] - Stream segment revenue was $133 million, up 8% from the previous year, driven by increased sales from Mount Milligan and Pueblo Viejo [11][12] - The company achieved full offset of the Pueblo Viejo advanced stream deposit during the quarter [6][14] Market Data and Key Metrics Changes - Gold accounted for approximately 78% of total revenue, followed by silver at 11% and copper at 7% [17] - Metal prices were a primary driver for revenue increase, with gold up 40% and silver up 17% year-over-year [17] Company Strategy and Development Direction - The company is positioning itself as a premier growth company through acquisitions of Sandstorm Gold and Horizon Copper, which will enhance scale, growth, and diversification [7][27] - The strategic focus remains on growth in precious metals, maintaining a strong balance sheet, and increasing dividends [8][27] - Recent acquisitions include a gold stream on the Kansanshi mine in Zambia, which is expected to deliver approximately 12,500 ounces of gold this year [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in closing the Sandstorm and Horizon transactions by the fourth quarter, having received necessary approvals under Canadian competition laws [27][28] - The company remains comfortable with its 2025 guidance range despite underperformance in some key assets, attributing this to a rigorous risk-adjusted budgeting process [41] Other Important Information - The company remains debt-free and has total liquidity of over $1.25 billion, including a $1 billion revolving credit facility [22] - Recent business development successes have led to an increase in the revolving credit facility's accordion feature from $250 million to $400 million [22][23] Q&A Session Summary Question: Can you discuss the deleveraging goal post-transactions? - Management indicated that they plan to use excess cash flow to pay down the revolver over time, with a goal to potentially return it to zero [30][32] Question: What assets are offsetting the underperformance in key assets? - Management explained that they do not disclose guidance based on individual operations but conduct a rigorous budgeting process to maintain their guidance range [36][41] Question: Are you maxed out on African exposure with the Kansanshi acquisition? - Management stated they are comfortable with their current African investments and would consider additional opportunities if the country conditions are favorable [44][45] Question: Is there any consideration for a share buyback due to underperformance? - Management emphasized that the focus will be on debt repayment before considering any buyback options [46][47] Question: What is the timing for the Sandstorm transaction circular filing? - Management could not provide a detailed timetable but confirmed that they expect to file the preliminary proxy with the SEC shortly [49][50]

Core Insights - Royal Gold, Inc. (RGLD) reported adjusted earnings per share (EPS) of $1.81 for Q2 2025, exceeding the Zacks Consensus Estimate of $1.70, marking a 45% year-over-year increase [1][6] - The company achieved record revenues of $210 million, a 20.4% increase year-over-year, driven by higher metal prices and gold production from Peñasquito and Manh Choh, despite lower gold sales from Xavantina [2][6] - Adjusted EBITDA rose 24.5% to $175 million, with an adjusted EBITDA margin of 83.8%, up from 81% in the prior year [3][6] Financial Performance - The cost of sales remained flat at $24 million year-over-year, while general and administrative expenses decreased by 2.3% to $10 million [3] - Net cash from operating activities was $153 million, up from $113.5 million in the prior year, with cash and cash equivalents at approximately $248 million compared to $195 million at the end of 2024 [4] Stock Performance - Over the past year, RGLD shares have increased by 27.6%, while the industry has seen a growth of 57.9% [5] Peer Comparisons - Kinross Gold Corporation (KGC) reported adjusted earnings of $0.44 per share, a significant increase from $0.14 in the prior year, with revenues rising 41.7% year-over-year to $1,728.5 million [9] - Agnico Eagle Mines Limited (AEM) reported adjusted earnings of $1.94 per share, up from $1.07, with revenues of $2,816.1 million, a 35.6% increase year-over-year [10] - Newmont Corporation (NEM) reported adjusted earnings of $1.43 per share, up from $0.72, with revenues of $5,317 million, a 20.8% increase from the prior year [11]

Second Quarter 2025 Results August 7, 2025 Cautionary Statements Important Additional Information and Where to Find It: In connection with the proposed transactions, Royal Gold, Sandstorm and Horizon intend to file materials with the SEC and on SEDAR+, as applicable. Royal Gold plans to file proxy materials with the SEC in connection with the solicitation of proxies for Royal Gold's special meeting of shareholders (the "Royal Gold Special Meeting"). Prior to the Royal Gold Special Meeting, Royal Gold will f ...

PART I FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited consolidated financial statements for Q2 and H1 2025, showing significant growth in revenue and net income driven by higher metal prices and new acquisitions Consolidated Balance Sheet Highlights (as of June 30, 2025) | Account | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :--- | :--- | :--- | | **Total current assets** | 342,013 | 275,287 | | **Total assets** | 3,572,453 | 3,392,130 | | **Total current liabilities** | 76,101 | 85,151 | | **Total liabilities** | 253,494 | 260,924 | | **Total equity** | 3,318,959 | 3,131,206 | Consolidated Statement of Operations Highlights | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | Six Months 2025 ($ thousands) | Six Months 2024 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | 209,643 | 174,096 | 403,080 | 322,999 | | **Operating income** | 141,840 | 102,083 | 264,952 | 177,609 | | **Net income attributable to Royal Gold** | 132,349 | 81,208 | 245,847 | 128,372 | | **Diluted EPS** | $2.01 | $1.23 | $3.73 | $1.95 | Consolidated Statement of Cash Flows Highlights (Six Months Ended June 30) | Cash Flow Activity | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | **Net cash provided by operating activities** | 289,171 | 251,799 | | **Net cash used in investing activities** | (171,049) | (27,341) | | **Net cash used in financing activities** | (65,440) | (254,393) | | **Net increase (decrease) in cash** | 52,682 | (29,935) | Notes to Consolidated Financial Statements Notes detail accounting policies and financial line items, disclosing recent acquisitions and credit facility amendments - In Q2 2025, the company entered into a **$200 million** stream and royalty agreement for the Warintza Project, with **$100 million** paid at closing and the remainder conditional[20](index=20&type=chunk) - The company's revolving credit facility was amended on June 26, 2025, extending the maturity to 2030 and increasing the accordion feature to **$400 million**. As of June 30, 2025, no amount was outstanding[35](index=35&type=chunk)[37](index=37&type=chunk) - Subsequent to the quarter end, the company acquired a **$1.0 billion** gold stream on the Kansanshi mine, funded by cash and an **$825 million** draw on its credit facility. It also entered into agreements to acquire Sandstorm Gold and Horizon Copper[72](index=72&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk) Revenue by Segment (Six Months Ended June 30, 2025) | Segment | Revenue ($ thousands) | | :--- | :--- | | Stream interests | 255,673 | | Royalty interests | 147,407 | | **Total** | **403,080** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes Q2 and H1 2025 financial results, highlighting revenue growth from higher metal prices, recent acquisitions, and liquidity - The company's business is divided into two segments: Acquisition and Management of Stream Interests (**63% of H1 2025 revenue**) and Acquisition and Management of Royalty Interests (**37% of H1 2025 revenue**)[87](index=87&type=chunk) - Recent strategic developments include the **$1.0 billion** Kansanshi gold stream acquisition, agreements to acquire Sandstorm Gold and Horizon Copper, and the **$200 million** Warintza project stream and royalty agreement[91](index=91&type=chunk)[98](index=98&type=chunk)[100](index=100&type=chunk) Q2 2025 vs Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | Change Driver | | :--- | :--- | :--- | :--- | | **Total Revenue** | $209.6M | $174.1M | Higher average gold and silver prices | | **Net Income** | $132.3M | $81.2M | Higher revenue and lower tax expense | | **Average Gold Price** | $3,280/oz | $2,338/oz | Market conditions | - As of June 30, 2025, the company had working capital of **$265.9 million** and total liquidity of approximately **$1.3 billion**. Subsequent to the quarter, the credit facility was increased to **$1.4 billion**, and **$825 million** was drawn for the Kansanshi acquisition[142](index=142&type=chunk)[143](index=143&type=chunk)[148](index=148&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section outlines the company's primary market risk from metal price volatility, providing a sensitivity analysis on revenue impact - The company's earnings and cash flows are significantly impacted by fluctuations in the market prices of gold, silver, and copper[158](index=158&type=chunk) Revenue Sensitivity to 10% Metal Price Change (H1 2025) | Metal | Percentage of Total Revenue | Impact on Revenue ($) | | :--- | :--- | :--- | | Gold | 77% | $31.4 million | | Silver | 12% | $4.7 million | | Copper | 8% | $3.6 million | [Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes in internal controls during the quarter - Based on an evaluation as of June 30, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[160](index=160&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, these controls[161](index=161&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no legal proceedings for the period - The company reported no legal proceedings[163](index=163&type=chunk) [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors, highlighting increased indebtedness, acquisition integration challenges, stock dilution, and joint venture risks - Increased indebtedness following the Kansanshi acquisition and planned draws for the Sandstorm and Horizon transactions could adversely affect financial condition and limit operational flexibility[165](index=165&type=chunk)[167](index=167&type=chunk) - The proposed acquisition of Sandstorm Gold will involve issuing a significant number of new shares, which could create a "market overhang" and depress the stock price. Current Royal Gold stockholders' ownership will be diluted to approximately **77%** of the combined company[169](index=169&type=chunk)[181](index=181&type=chunk) - The Sandstorm and Horizon transactions are subject to significant closing conditions and risks, including the potential inability to successfully integrate the businesses or realize anticipated synergies[171](index=171&type=chunk)[175](index=175&type=chunk) - The acquisition of Horizon includes a **30%** interest in the Hod Maden project, subjecting the company to joint venture risks where it is not the operator and has limited control over strategic decisions[178](index=178&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or related use of proceeds during the period - None reported[184](index=184&type=chunk) [Defaults Upon Senior Securities](index=35&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon its senior securities - None reported[185](index=185&type=chunk) [Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Royal Gold's business model - Not applicable[186](index=186&type=chunk) [Other Information](index=35&type=section&id=Item%205.%20Other%20Information) This section discloses no Rule 10b5-1 trading plan changes and details post-quarter financing activities, including a **$825 million** borrowing and credit facility increase - On August 1, 2025, the company borrowed **$825 million** under its revolving credit facility to fund the Kansanshi stream acquisition[188](index=188&type=chunk) - On August 5, 2025, the company exercised a **$400 million** accordion feature, increasing its total committed revolving credit facility to **$1.4 billion**, with **$575 million** remaining available after the Kansanshi borrowing[188](index=188&type=chunk) [Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including acquisition agreements, credit facility amendments, and certifications - Key exhibits filed include the arrangement agreements for the Sandstorm and Horizon acquisitions, dated July 6, 2025[191](index=191&type=chunk) - The Sixth Amendment to the Revolving Facility Credit Agreement and the Incremental Joinder to the agreement are filed as exhibits[191](index=191&type=chunk)

Royal Gold (RGLD 0.72%), a leading precious metals streaming and royalty company, released its second quarter 2025 earnings on August 6, 2025. The report highlighted record GAAP net income of $132.3 million. Net cash provided by operating activities totaled $152.8 million, compared to $113.5 million for the three months ended June 30, 2024, but GAAP revenue came in below analyst forecasts at $209.6 million—falling short of the $217.8 million consensus. Management emphasized progress on strategic acquisition ...

Summary of Royal Gold (RGLD) M&A Announcement Company and Industry - **Company**: Royal Gold (RGLD) - **Industry**: Mining, specifically gold and copper production Core Points and Arguments 1. **Acquisition Announcement**: Royal Gold announced the acquisition of a $1 billion life of mine gold stream from First Quantum's Kansanshi mine in Zambia [4][2][1] 2. **Strategic Rationale**: The acquisition aligns with Royal Gold's strategic investment criteria, emphasizing First Quantum's strong operational history and Zambia's supportive mining jurisdiction [4][5][2] 3. **Zambia's Mining Contribution**: In 2023, mining was the second largest contributor to Zambia's GDP, with government strategies launched in 2024 to further support the sector [5][4][2] 4. **Kansanshi Mine Overview**: The mine is a large-scale copper producer with significant gold byproduct credits, currently undergoing a major expansion to increase production [5][4][2] 5. **Gold Stream Details**: The agreement includes a tiered gold stream rate starting at 75 ounces of gold per million pounds of copper produced, with adjustments based on cumulative deliveries [6][7][2] 6. **Expected Deliveries**: Royal Gold anticipates receiving approximately 12,500 ounces of gold in the first year, with average annual deliveries projected at 35,000 to 40,000 ounces over the next decade [7][6][2] 7. **Support for Local Programs**: Royal Gold committed to supporting First Quantum's local social programs throughout the mine's life [7][6][2] 8. **Acceleration Options**: First Quantum has options to accelerate gold deliveries, potentially reducing stream rates by up to 30% based on financial performance metrics [8][9][2] 9. **Cash Payment Structure**: The cash payment per ounce will be 20% of the spot price, increasing to 35% if certain conditions are met [11][10][2] 10. **Financing Strategy**: Royal Gold extended its revolving credit facility to $1.4 billion and utilized $825 million to fund the acquisition, maintaining a net debt to EBITDA ratio of 1.2x post-acquisition [13][14][2] 11. **Debt Repayment Plans**: The company expects to repay outstanding debt within two years after closing additional acquisitions, while maintaining dividend commitments [14][15][2] 12. **Long-term Growth Strategy**: The acquisition is part of Royal Gold's strategy to grow through high-quality, long-life precious metals assets in mining-friendly jurisdictions [17][16][2] Other Important Content 1. **Market Conditions**: The acquisition timing was described as a good opportunity that arose while Royal Gold was engaged in other major transactions [15][17][2] 2. **Portfolio Impact**: The Kansanshi Goldstream acquisition is expected to enhance Royal Gold's portfolio, increasing gold weighting to approximately 80% of NAV [16][15][2] 3. **Risk Assessment**: Royal Gold conducted a thorough risk assessment of First Quantum's overall model, considering extreme scenarios to ensure financial stability [22][21][2]

Group 1 - The Federal Reserve has maintained interest rates unchanged for the fifth consecutive time, impacting market performance [1] - Major U.S. stock indices showed mixed results, with the Dow Jones down 0.38%, the Nasdaq up 0.15%, and the S&P 500 down 0.12% [1] - Popular technology stocks experienced varied movements, with Nvidia rising over 2% and Apple declining more than 1% [1] Group 2 - Precious metals and copper-related stocks faced significant declines, with Freeport-McMoRan Copper & Gold down over 9% and Southern Copper down over 6% [1] - The Nasdaq China Golden Dragon Index fell by 1.82%, with most popular Chinese concept stocks declining, including NIO and New Oriental down over 4% [1] - Other notable declines included Li Auto down over 3%, Pinduoduo and Xpeng down over 2%, and Alibaba and JD down over 1% [1]

Core Insights - Royal Gold (RGLD) has a strong track record of exceeding earnings estimates, particularly in the last two quarters, with an average surprise of 9.81% [1][2] - The company reported earnings of $1.51 per share in the last quarter, surpassing the Zacks Consensus Estimate of $1.37 per share by 10.22% [2] - Royal Gold's positive Earnings ESP of +6.85% indicates bullish sentiment among analysts regarding its earnings prospects [8] Earnings Performance - In the previous quarter, Royal Gold's earnings were $1.63 per share against an expected $1.49, resulting in a surprise of 9.40% [2] - The company has consistently shown a pattern of beating earnings estimates, which is a positive indicator for future performance [1][2] Analyst Sentiment - Recent estimates for Royal Gold have been trending upward, reflecting increased analyst confidence [5] - The combination of a positive Earnings ESP and a Zacks Rank of 1 (Strong Buy) suggests a high likelihood of another earnings beat in the upcoming report [8] Earnings ESP Explanation - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate being more reflective of recent analyst revisions [7] - Stocks with a positive Earnings ESP and a Zacks Rank of 3 or better have a nearly 70% chance of producing a positive surprise [6]

Core Viewpoint - Royal Gold (RGLD) has experienced a significant downtrend, with a 13.6% decline over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is a key technical indicator used to identify oversold conditions, with a reading below 30 indicating that a stock may be oversold [2]. - RGLD's current RSI reading is 28.19, indicating that the heavy selling pressure may be exhausting, which could lead to a price rebound [5]. - The RSI helps investors identify potential entry points for stocks that have fallen below their fair value due to excessive selling [3]. Group 2: Fundamental Indicators - There is a strong consensus among sell-side analysts regarding RGLD, with a 2.4% increase in the consensus EPS estimate over the last 30 days, indicating positive earnings revisions [7]. - An upward trend in earnings estimate revisions typically correlates with price appreciation in the near term [7]. - RGLD holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks, further supporting the potential for a near-term turnaround [8].