Royal Gold(US:RGLD)2025-11-05 23:52Revenue and Profitability - As of September 30, 2025, Royal Gold owned 10 stream interests, accounting for approximately 66% of total revenue for the three months and 64% for the nine months ended September 30, 2025[95]. - Royalty interests accounted for 34% of total revenue for the three months and 36% for the nine months ended September 30, 2025, compared to 31% for the same periods in 2024[95]. - For the three months ended September 30, 2025, total revenue was $252.1 million, comprised of stream revenue of $166.1 million and royalty revenue of $86.0 million, compared to $193.8 million in the prior year, indicating a year-over-year increase of approximately 30%[137]. - For the nine months ended September 30, 2025, total revenue reached $655.1 million, an increase from $516.8 million in the same period of 2024, driven by higher average metal prices and increased production[149]. - Net income for the nine months ended September 30, 2025, was $372.7 million, or $5.66 per basic share, compared to $224.6 million, or $3.41 per basic share, for the same period in 2024[148]. - For the three months ended September 30, 2025, the company recorded net income of $126.8 million, or $1.92 per share, compared to $96.2 million, or $1.46 per share, for the same period in 2024, reflecting a significant increase in profitability[136]. Metal Prices and Deliveries - Average gold price for the three months ended September 30, 2025, was $3,457 per ounce, contributing 78% to total revenue, while silver averaged $39.40 per ounce, contributing 12%[98]. - The average gold price for the three months ended September 30, 2025, was $3,457 per ounce, compared to $2,474 per ounce in the prior year, reflecting a significant increase in commodity prices[137]. - Gold stream deliveries from Andacollo increased to approximately 8,000 ounces for the three months ended September 30, 2025, up from approximately 5,200 ounces in the same period last year, reflecting improved grades and recoveries[122]. - The company expects 2025 stream deliveries from Kansanshi to be approximately 7,500 ounces, lower than the initial expectation of 12,500 ounces due to the initiation of delivery mechanics[126]. - Gold stream deliveries from Mount Milligan were approximately 14,800 ounces for the three months ended September 30, 2025, down from approximately 22,100 ounces in the same period last year, primarily due to lower grades and recoveries[128]. - Gold stream deliveries from Pueblo Viejo increased to approximately 8,400 ounces for the three months ended September 30, 2025, compared to approximately 6,000 ounces in the prior year, driven by higher throughput and grades[131]. - The company received its first delivery of approximately 2,300 ounces of gold from Kansanshi on October 3, 2025, marking the commencement of a new precious metals purchase agreement[125]. - For the three months ended September 30, 2025, total gold purchases were 44,900 ounces, while sales were 38,600 ounces, compared to 45,700 ounces purchased and 40,700 ounces sold in the same period of 2024[141]. - Silver purchases for the three months ended September 30, 2025, totaled 632,800 ounces, with sales of 594,500 ounces, compared to 456,700 ounces purchased and 688,200 ounces sold in the same period of 2024[141]. Acquisitions and Investments - On October 20, 2025, Royal Gold completed the acquisition of Sandstorm Gold Ltd. and Horizon Copper Corp., issuing 18.6 million shares and paying $380.9 million in cash[99][100]. - The Warintza Project acquisition included a $200 million advance payment, with $100 million paid at closing and additional payments contingent on project milestones[112]. - Royal Gold made an advance payment of $1.0 billion for a gold stream agreement related to the Kansanshi copper-gold mine, with deliveries structured based on copper production[107]. - The company utilized $1.2 billion in investing activities for the nine months ended September 30, 2025, primarily due to payments for stream and royalty interests[169]. - The company borrowed $825.0 million under its revolving credit facility for the acquisition of Sandstorm and Horizon, with $450.0 million borrowed in October 2025[167]. Operational Performance - The Cortez Complex produced approximately 202,200 ounces of gold for the three months ended September 30, 2025, an increase from approximately 161,800 ounces in the same period last year[134]. - The Mount Milligan Pre-Feasibility Study announced an extension of the mine life to 2045, with average annual production projected at 150,000 ounces of gold and 69 million pounds of copper from 2026 to 2042[102]. - The company is targeting a Final Investment Decision for the Warintza project by the end of 2026, indicating ongoing strategic development efforts[115]. Financial Metrics and Costs - Cost of sales for the nine months ended September 30, 2025, increased to $80.1 million from $73.1 million in the same period of 2024, primarily due to higher payments for stream deliveries resulting from increased metal prices[154]. - General and administrative costs for the nine months ended September 30, 2025, decreased to $31.5 million from $32.0 million in the same period of 2024, mainly due to lower non-cash stock compensation expenses[155]. - Interest and other income increased significantly to $6.8 million for the three months ended September 30, 2025, from $0.6 million in the same period of 2024, primarily due to a $4.9 million gain on the sale of restricted inventory[145]. - Interest and other expense rose to $8.6 million for the three months ended September 30, 2025, from $1.2 million in the same period of 2024, mainly due to higher interest expenses related to increased amounts outstanding under the revolving credit facility[146]. - The effective tax rate for the three months ended September 30, 2025, was 17.9%, compared to 18.3% for the same period in 2024, with income tax expense recorded at $28.7 million[147]. - The company recorded income tax expense of $49.6 million for the nine months ended September 30, 2025, resulting in an effective tax rate of 11.6%, down from 23.1% in the prior year[159]. Liquidity and Debt - Liquidity at September 30, 2025, included $287.4 million in current assets against $99.5 million in current liabilities, resulting in working capital of $187.9 million[160]. - The company had $775.0 million in outstanding debt and $625.0 million available under its revolving credit facility as of September 30, 2025[161]. - A 10% increase in the average gold price would have increased total reported revenue by $51.3 million, while a 10% decrease would have reduced it by the same amount[178]. - Net cash provided by operating activities totaled $463.1 million for the nine months ended September 30, 2025, compared to $388.5 million for the same period in 2024, reflecting an increase of approximately 19.2%[168].