Osisko Gold Royalties(OR) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Osisko achieved record annual revenues of $191.2 million in 2024, with a cash margin of 96.5% [6] - The company earned 20,005 gold equivalent ounces (GEOs) in Q4 2024, totaling 80,740 GEOs for the year, slightly above the revised guidance of 77,000 to 83,000 GEOs [5][11] - Net earnings per share for 2024 were$ 0.09, a significant increase from 2023, which was impacted by non-cash impairment charges [12] - Cash flow per share improved for the seventh consecutive year, with positive annual adjusted earnings of $0.52 per common share [12] Business Line Data and Key Metrics Changes - The Canadian Malartic Mine remained the most significant contributor to GEOs earned, with strong performance expected to continue [15] - Capstone's Mantos Blancos operation experienced a year-over-year decrease in performance due to below-design milling rates, but improvements were noted in late 2024 [15][30] - The Namdini mine in Ghana poured its first gold in November 2024, with meaningful payments expected in the second half of 2025 [12][18] Market Data and Key Metrics Changes - Osisko derived over 93% of its GEOs from precious metals, with gold accounting for 67% and silver for 27% [13] - The company expects additional base metal contributions from projects like South32's Hermosa/Taylor and Marimaca Copper's MOD project [14] Company Strategy and Development Direction - Osisko aims for GEO delivery growth in 2025, although the growth slope is expected to be less steep than previously anticipated [8] - The company is focused on disciplined capital allocation, targeting high-quality precious metal streams and royalties [41][56] - Osisko's exposure to Tier 1 mining jurisdictions is a key differentiator, with a focus on Canada, the U.S., and Australia [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's growth trajectory and the potential for meaningful transactions in 2025 [10][41] - The company acknowledged challenges in the copper market but remains open to opportunities that are accretive to shareholder value [54][75] - Management highlighted the importance of maintaining a strong balance sheet to support future growth initiatives [40][42] Other Important Information - Osisko declared a quarterly dividend of$ 0.065 per share in Q4 2024, marking the 41st consecutive dividend payment [7] - The company closed or committed to nearly $300 million in transactions in 2024, maintaining a robust pipeline for future opportunities [9][41] Q&A Session Summary Question: Clarification on 2025 production profile - Management indicated that Q1 2025 is expected to be the weakest quarter, with improvements anticipated in Q2, and stronger performance in Q3 and Q4 [46][47] Question: Opportunities in capital allocation - Management confirmed openness to syndicated deals and highlighted a robust opportunity set, particularly in the copper space [52][54] Question: Size range of potential transactions - The focus is on transactions between$ 50 million and $500 million, with a preference for cash-flowing assets or those impacting the five-year outlook [60][63] Question: Share buybacks versus dividends - Management views share buybacks as a tool but emphasizes the importance of dividends, with potential for an increase in the upcoming Board meeting [64][66]