Royal Gold Reports Record Revenue, Operating Cash Flow and Earnings for the Second Quarter of 2025

2025-08-06

TSX - Toronto Stock Exchange · Gold · Silver · Canada

Royal Gold, Inc. (NASDAQ: RGLD) (together with its subsidiaries, “Royal Gold,” the “Company,” “we,” “us,” or “our”) reports net income of $132.3 million, or $2.01 per share, for the quarter ended June 30, 2025 ("second quarter"), on revenue of $209.6 million and operating cash flow of $152.8 million. Adjusted net income 1 was $118.8 million, or $1.81 per share.

Second Quarter 2025 Highlights:

Records for revenue of $209.6 million , operating cash flow of $152.8 million , and earnings of $132.3 million Revenue split: 78% gold , 11% silver , 7% copper Sales volume of 63,900 GEOs 2 Adjusted EBITDA margin 1 of 84% Total available liquidity of approximately $1.25 billion Paid quarterly dividend of $0.45 per share , a 12.5% increase over the prior year period Acquired stream and royalty interests on the Warintza project Achieved full repayment of Pueblo Viejo stream advance

Post Quarter Events:

Agreements to acquire Sandstorm Gold and Horizon Copper Acquired gold stream on the Kansanshi mine from First Quantum Minerals

_“Royal Gold produced another quarter of excellent financial results, with record revenue, earnings and operating cash flow, demonstrating again the leverage in our business to strong precious metal prices,” commented Bill Heissenbuttel, President and CEO of Royal Gold . _

_“We always seek to improve our business and we saw opportunities recently to take significant steps to position Royal Gold as a premier growth company in the streaming and royalty sector," _continued Mr. Heissenbuttel. "The acquisitions of Sandstorm Gold and Horizon Copper will bring scale, growth and diversification to Royal Gold and make us the most diversified and gold-focused company in our sector."

"We will continue to build on this foundation, and the recent acquisitions on the Kansanshi mine and Warintza project clearly demonstrate that we can add large, high quality, and long life assets to the portfolio. The combination of these transactions positions us with what we believe to be the best portfolio and organic growth pipeline in our sector, with exposure to some of the leading operating and development projects in the mining business."

| 1 | Adjusted net income, adjusted net income per share and adjusted EBITDA margin are non-GAAP financial measures. See Schedule A of this press release for additional information, including a detailed description of adjustments to net income. | | 2 | See Schedule A of this press release for additional information about gold equivalent ounces, or GEOs. |

Recent Portfolio Developments

Principal Property Updates

Notable recent updates as reported by the operators of our Principal Properties include:

Mine Life Extension Project Continues and Gold Production Guidance Adjusted at Mount Milligan

On August 6, Centerra Gold Inc. ("Centerra") provided an update on second quarter production and the status of the mine life extension study at the Mount Milligan mine in British Columbia.

Centerra reported that gold grades in the first half of 2025 were lower than anticipated, primarily attributed to certain areas within the pit with complex geology. In order to address this issue and improve geological and mine plan confidence, Centerra commenced an infill and grade control drilling program in the second quarter of 2025. As a result of the lower gold grades, Centerra updated 2025 guidance for gold production to 145,000 to 165,000 ounces, from 165,000 to 185,000 ounces previously, and reaffirmed its copper production guidance range of 50 to 60 million pounds. Both gold and copper production are expected to be weighted towards the second half of the year.

With respect to the Pre-Feasibility Study (“PFS”) to extend the mine life, Centerra reported that work is on track to be completed in the third quarter of 2025. Centerra remains optimistic that it can extend the current mine life beyond 2036 with the addition of tailings capacity, and increase the annual mill throughput in the range of 10% through ball mill motor upgrades.

Advance Stream Payment Fully Offset at Pueblo Viejo

During the second quarter, the value of deliveries received from our gold and silver streams at the Pueblo Viejo mine in the Dominican Republic, when combined with the value of cumulative deliveries received since the July 1, 2015, effective date of the stream agreement, exceed the $610 million advance payment made by Royal Gold to a subsidiary of Barrick Mining Corporation ("Barrick"). Barrick is currently advancing a mine life extension project that is targeted to produce 800,000 ounces of gold per year (100% basis) to the mid-2040s.

Production Resumed to Full Rates and Union Contracts Ratified at Andacollo

On June 2, 2025, Teck Resources Limited ("Teck"), reported a mechanical issue at Andacollo requiring a maintenance shutdown of the SAG mill. On July 24, 2025, Teck reported that the SAG mill successfully restarted in late June and production has now resumed to full rates, and 2025 copper production guidance is unchanged from the previous guidance range of 45,000 to 55,000 tonnes. Teck does not provide gold production guidance. Teck further reported that both union contracts at Andacollo were ratified in June and July, 2025, respectively, each covering a three year period.

Other Property Updates

Notable recent updates as reported by the operators of other select portfolio assets include:

Producing Properties

Rainy River (6.5% gold stream, 60% silver stream): On July 28, 2025, New Gold Inc. ("New Gold") reported second quarter results for the Rainy River mine in Ontario. According to New Gold, June 2025 gold production totaled 37,341 ounces, a monthly production record, and with the mill now processing higher grade open pit material, gold production is expected to continue to increase in the third quarter. New Gold reported that gold production through the first half of 2025 represented approximately 34% of the midpoint of annual guidance range of 265,000 to 295,000 ounces, and Rainy River is on-track for increased production in the second half of the year.

Khoemac a u (100% silver stream): On July 22, 2025, MMG Limited ("MMG") provided an update on the expansion project at the Khoemac a u mine in Botswana. According to MMG, a feasibility study is underway and expected to be completed by the end of 2025, with construction scheduled to begin following the approval of the feasibility study, and first concentrate production expected in 2028.

Bellevue (2% NSR royalty): On August 1, 2025, Bellevue Gold Limited ("Bellevue") provided gold production guidance for the Bellevue Gold Mine in Western Australia. Bellevue expects production in the fiscal year ending June 30, 2026, to range between 130,000 and 150,000 ounces, with quarterly performance set to progressively ramp up through the year, and production in the fiscal year ending June 30, 2027 to range between 175,000 and 195,000 ounces.

Côté Gold (1% NSR royalty): On June 23, 2025, IAMGOLD Corporation (“IAMGOLD”) announced that on June 21, 2025, the Côté Gold mine in Ontario reached a major milestone as the processing plant operated at the nameplate capacity of 36,000 tonnes per day on average over thirty consecutive days. IAMGOLD maintained its gold production guidance at Côté Gold of between 360,000 and 400,000 ounces for 2025.

Mara Rosa (1.0% NSR and 1.75% NSR royalties): On July 23, 2025, Hochschild Mining PLC ("Hochschild") provided a quarterly production report for the Mara Rosa operation in Brazil. As previously reported by Hochschild, the operation of the processing plant was temporarily suspended on June 23, 2025, after heavier-than-usual seasonal rainfall as well as contractor performance issues. Hochschild disclosed that mining activity is continuing as planned, and a comprehensive review of all mining, processing and disposal activities is underway to identify constraints to the mine’s output. Mara Rosa produced approximately 12,430 GEOs in the second quarter, and Hochschild expects to provide a full update and revised guidance in late August, 2025.

Xavantina (25% gold stream): On July 31, 2025, Ero Copper Corp. ("Ero") revised 2025 gold production guidance at the Xavantina mine in Brazil to 40,000 to 50,000 ounces, from the 50,000 to 60,000 guidance range provided previously. Ero reported that production in the first half of 2025 was lower than planned, and ongoing investments in mine modernization and mechanization are expected to drive a step-change in mining rates in the second half of 2025, resulting in higher projected production and lower unit costs that align with the long-term outlook for the operation. Additionally, the delivery threshold of 49,000 ounces was achieved in July, 2025, and the cash price paid by RG AG for each ounce delivered under the stream agreement increased from 25% to 40% of the spot gold price.

Development Properties

Back River (equivalent ~3.3% GSR royalty on the Goose Project): On June 30, 2025, B2Gold Corp. (“B2Gold”) announced the first gold pour at the Goose Project in the Back River Gold District in Nunavut, Canada. According to B2Gold, first ore was processed on June 24, 2025, and the mill has run consistently at approximately 50% of nameplate capacity during this initial phase, as planned. B2Gold expects a ramp up to commercial production in the third quarter of 2025, and has maintained 2025 gold production guidance of between 120,000 and 150,000 ounces.

Cactus (2.0% NSR royalty): On June 25, 2025, Arizona Sonoran Copper Company Inc. ("ASCU") announced that it had exercised its right to buy back 0.5% of Royal Gold’s aggregate 2.5% NSR royalty on the Cactus Project in Arizona for $7 million. The buyback was expected and was factored into our initial valuation when the royalty was acquired in 2024. Royal Gold will hold a 2.0% NSR royalty after closing, which is targeted to be on or about August 12, 2025.

Portfolio Additions

Acquisition of Gold Stream on the Kansanshi Mine in Zambia

As announced on August 5, 2025, our wholly-owned subsidiary RGLD Gold AG (“RG AG”), entered into a precious metals purchase agreement (“Stream Agreement”) for gold deliveries referenced to copper production from the Kansanshi copper-gold mine (“Kansanshi”) in the North Western Province of Zambia, operated and 80% owned by a subsidiary of First Quantum Minerals Ltd. (“First Quantum”).

RG AG made an advance payment of $1.0 billion (“Advance”) in return for a gold stream referenced to copper production, with deliveries of 75 ounces of gold per million pounds of recovered copper produced until the delivery of 425,000 ounces; 55 ounces of gold per million pounds of recovered copper produced between the delivery of 425,001 ounces and 650,000 ounces; and 45 ounces of gold per million pounds of recovered copper produced thereafter. Additionally, and depending on the achievement of certain objectives as described below, RG AG has granted options to First Quantum to accelerate stream deliveries and reduce the outstanding Advance:

1. Acceleration Option 1: From the earlier of the achievement by First Quantum of a minimum ‘BB’ or equivalent senior unsecured debt rating from a rating agency, or a Net Debt/TTM EBITDA ratio of 2.25x or less over three consecutive quarters starting from March 31, 2026, it will have a one-year period to exercise the option and deliver gold worth up to $200 million over a 14-month period from the date of option exercise and reduce the stream rates and delivery thresholds by up to 20%. 2. Acceleration Option 2: If First Quantum achieves either a minimum ‘BBB-’ or equivalent senior unsecured debt rating from a rating agency, or shows a Net Debt/TTM EBITDA ratio of 1.25x or less over four consecutive quarters, and achieves certain operational conditions, it will have a one-year period to exercise the option and deliver gold worth up to $100 million over a 7-month period from the date of option exercise and reduce the stream rates and delivery thresholds by up to a further 10%.

RG AG will pay 20% of the spot gold price for each ounce delivered. Should one of the conditions in Acceleration Option 1 be met, Royal Gold will pay 35% of the spot gold price for each ounce delivered.

RG AG’s interests under the stream agreement are guaranteed by all entities within the Kansanshi ownership chain, from the project company (Kansanshi Mining PLC) through to the parent, First Quantum Minerals Ltd. RG AG also has customary additional protections for a stream agreement including limitations on certain additional encumbrances, restrictions on transfer of mine ownership, sharing for insurance and expropriation proceeds, and typical remedies for events of default.

The Kansanshi mine is owned and operated by Kansanshi Mining PLC, which is 80% owned indirectly by First Quantum and 20% by ZCCM Investments Holdings PLC, a company majority-owned by the Government of the Republic of Zambia. First Quantum acquired its interest in the project in 2001, began construction soon after, and achieved commercial production in 2005. As of December 31, 2024, Proven and Probable Reserves consisted of 1.070 billion tonnes grading 0.52% copper and 0.10 grams per tonne gold, calculated using a copper price of $3.50 per pound and a gold price of $1,805 per ounce. As of the same date, Measured and Indicated Resources (inclusive of Reserves) were 1.297 billion tonnes grading 0.57% copper and 0.07 grams per tonne gold, calculated at a 0.2% copper cut-off grade. First Quantum expects a mine life of more than 20 years, and the All-In Sustaining Cost (“AISC”) is expected to be in the lower half of the global copper cost curve during the next 10 years of mine life.

Royal Gold funded the Advance using available cash and a draw of $825 million on its revolving credit facility.

Acquisition of Stream and Royalty Interests on the Warintza Project in Ecuador

As previously announced on May 21, 2025, RG AG acquired a gold stream and separate royalty interest in the Warintza copper-gold-molybdenum project in southeastern Ecuador, operated by Solaris Resources Inc. (“Solaris”). The advance payment (“Advance”) for the acquisition totals $200 million in cash consideration, including $100 million paid upon closing, $50 million payable after technical approval of the Environmental Impact Assessment (“EIA”) and publication of a PFS, which are expected to be complete in the third quarter of 2025, and $50 million payable one year after closing, subject to security perfection in Ecuador. Solaris will direct the proceeds of the Advance towards advancing technical studies, permitting activities, early infrastructure development, the repayment of debt, some district exploration activities and general working capital requirements. After receipt of the full Advance, Solaris expects to be fully funded through to a final investment decision.

In return for the Advance, RG AG and Solaris entered into:

1. A Gold Stream Agreement that provides for the delivery to RG AG of 20 ounces of gold per million pounds of recovered copper in return for a cash payment for each ounce delivered of 20% of the spot gold price until the delivery of 90,000 ounces, and 60% of the spot gold price thereafter. The Gold Stream Agreement may be subject to early termination at the option of RG AG or Solaris if a change of control of Solaris or Warintza occurs, or by RG AG if deliveries have not begun by May 21, 2033. The area of interest for the Gold Stream Agreement covers approximately 31 square kilometers, and will expand to 186 square kilometers if the early termination provisions have not been exercised and the first delivery has not been received by May 21, 2033. 2. A Royalty Agreement that provides for payment to RG AG of a net smelter return (“NSR”) royalty at an initial rate of 0.30% for all metals produced from an area of interest of approximately 186 square kilometers. The royalty rate will increase by 0.0375% per year until the earlier to occur of the first delivery under the Gold Stream Agreement or May 21, 2033, to a maximum of 0.60%. If the Gold Stream Agreement is subject to early termination, the royalty rate will be the rate in place at the time of exercise if the early termination is exercised by RG AG, or 0.60% if the early termination is exercised by Solaris.

RG AG will also maintain certain rights to participate in any future stream, royalty or similar production-based financing on the Warintza land package.

The Warintza project consists of a cluster of five separate porphyry copper-molybdenum-gold intrusions that coalesce within two overlapping open pits. Exploration potential is high for near and in-mine targets, as well as within the larger project area. Solaris is targeting a Final Investment Decision by the end of 2026.

Acquisition of Royalty Interest on the Lawyers-Ranch Project in British Columbia

On May 16, 2025, Royal Gold acquired a 2.0% NSR royalty on the Ranch portion of the Lawyers-Ranch Project operated by Thesis Gold Inc. (“Thesis”) from a private seller for cash consideration of $12.5 million. The royalty covers all metals, is perpetual with no buyback rights or caps, and constitutes a real property interest.

The Lawyers-Ranch Project is in the Toodoggone Epithermal/Porphyry Trend located in the Toodoggone mining district of Northern British Columbia, and Thesis is currently targeting completion of a Pre-Feasibility Study in the fourth quarter of 2025. This transaction increases Royal Gold’s royalty exposure to this emerging trend, which also includes a 0.5% NSR royalty on the Lawyers portion of the Lawyers-Ranch Project and a 0.5% royalty on the Shasta Project, operated by TDG Gold Corp.

Corporate Acquisitions

Agreements to Acquire Sandstorm Gold and Horizon Copper

On July 6, 2025, we entered into arrangement agreements to acquire each of Sandstorm Gold Ltd. (“Sandstorm”) and Horizon Copper Corp. (“Horizon”). Under the terms of the agreement with Sandstorm, Royal Gold has agreed to acquire 100% of the issued share capital of Sandstorm in exchange for Royal Gold shares at an exchange ratio of 0.0625 common shares of Royal Gold for each common share of Sandstorm (the “Sandstorm Transaction”), which reflected a transaction equity value of approximately $3.5 billion at the time of signing. Under the terms of the agreement with Horizon, Royal Gold has agreed to acquire 100% of the issued share capital of Horizon in exchange for cash of C$2.00/share (the “Horizon Transaction” and together with the Sandstorm Transaction, the “Transactions”), which reflected a transaction equity value of approximately $196 million at the time of signing.

The combined Sandstorm and Horizon portfolios will contribute 40 revenue-producing royalty and stream interests, with a further 28 in the development stage and 154 in the evaluation and exploration stages. After completing the Transactions, Royal Gold’s pro-forma portfolio will comprise 393 streams and royalties, largely focused on the Americas, with 80 revenue-producing interests and 47 in development. Royal Gold will also be well capitalized, remain precious metals focused, generate significant free cash flow, and have a portfolio that is well-positioned for organic cash flow growth from a robust development pipeline.

The Sandstorm Transaction will be effected by way of a court-approved plan of arrangement under the _Business Corporations Act _(British Columbia). At closing of the Sandstorm Transaction, Royal Gold expects to issue an aggregate of approximately 19 million common shares to Sandstorm shareholders, and following completion of the Sandstorm Transaction, existing Sandstorm shareholders will own approximately 23% of the issued and outstanding common shares of Royal Gold on a fully diluted basis.

The Sandstorm Transaction will be subject to the approval of 66 2/3% of the votes cast by shareholders of Sandstorm at a special meeting (the “Sandstorm Meeting”) and the approval of a simple majority of the votes cast by shareholders of Sandstorm at the Sandstorm Meeting excluding votes cast by senior officers and directors, as required under Multilateral Instrument 61-101. In addition, Royal Gold will require approval by a simple majority of the votes cast by Royal Gold shareholders at a special meeting. The full details of the Sandstorm Transaction will be described in Sandstorm’s management information circular and Royal Gold’s proxy statement to be prepared in accordance with applicable securities laws.