Triple Flag Precious Metals (TFPM) - 2025 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Triple Flag recorded 27,000 GEOs in Q3 2025, leading to record-adjusted EBITDA of $79 million and operating cash flow per share of $0.39 [2][5] - Operating cash flow per share increased by over 25% year-over-year, reflecting strong performance amid high precious metals prices [5][6] - The company exited the quarter with essentially zero net debt and is in a net cash position, with total liquidity available of nearly $1 billion [6][7] Business Line Data and Key Metrics Changes - Northparkes and Cerro Lindo were the largest contributors to revenues in Q3, with Northparkes achieving record performance due to processing higher open-pit grades [7] - The sales mix remains 100% derived from precious metals, with nearly three-quarters from gold, and this is expected to continue [7] Market Data and Key Metrics Changes - Precious metals prices reached record quarterly averages of nearly $3,500 per ounce for gold and nearly $40 per ounce for silver [5] - The company expects to achieve 2025 GEOs between the midpoint and high end of its guidance range, benefiting from current gold prices exceeding Q3 averages [2][5] Company Strategy and Development Direction - The company has deployed over $350 million in capital across five investments year-to-date, focusing on top-tier precious metals assets in mining-friendly jurisdictions [3][4] - Recent acquisitions include a 1% NSR royalty on the Arthur project in Nevada and a royalty package on Pan American's Minera Florida gold mine in Chile for $23 million [3][4] - The company aims to continue reinvesting cash flows into further streams and royalties to enhance shareholder value over time [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's legal position regarding a $10 million owed from Step Gold, indicating ongoing discussions with the controlling shareholder [14][15] - The company anticipates near-term catalysts from various projects ramping up production, including Johnson Camp Mine and Arcata [10] - The outlook for 2029 includes expectations for 135,000-145,000 ounces GEOs, supported by ramping up of newer assets and increased production from existing mines [39] Other Important Information - The company declared a quarterly cash dividend of $5.75 per share, reflecting its strong balance sheet and cash flow generation [7] - The exploration potential of the Minera Florida mine is significant, with expectations for increased GEOs by 2028 [9] Q&A Session Summary Question: How was the Minera Florida transaction sourced? - The transaction was a concentrated process, developed through rapport with the family involved, allowing for a site visit during negotiations [12][13] Question: Update on the ATO stream and discussions with Step Gold? - The company is confident in its legal position and is in dialogue with Step's controlling shareholder, expecting to land in the top half of its guidance range regardless of the outcome [14][15] Question: Insights on transaction opportunities and structures? - The company is evaluating opportunities in the $100-$300 million range, focusing on traditional mining jurisdictions and a mix of streams and royalties [18][19] Question: Status of Priesca project and investment decisions? - The project is being staged, with the upper zones developed first, and the company will evaluate the right to fund the stream into the deeper zones when ready [26][27] Question: Discussion on El Machido stream disposal? - The situation arose from the mine being undercapitalized, and the company structured a win-win situation to allow the operator to move forward without the stream [33][34] Question: Concerns about Minera Florida's grade reconciliation issues? - Management remains confident in the long-term performance of Minera Florida, citing its historical production records despite short-term variances [37][38] Question: Confirmation on the gold-silver ratio and its impact? - The current gold-silver ratio is around 85/1, and stronger silver prices benefit the company's GEO calculations and revenue [40][41]