Royal Gold Inc. Files Q2 2024 10-Q Report

TL;DR

Royal Gold Q2 10-Q filed. Check financials.

AI Summary

Royal Gold Inc. reported its second quarter 2024 results, ending June 30, 2024. The company's financial performance for the period is detailed in this 10-Q filing. Specific financial figures and operational highlights for the quarter are provided within the document.

Why It Matters

This filing provides investors and analysts with the latest financial and operational data for Royal Gold Inc., crucial for understanding the company's performance and future outlook.

Risk Assessment

Risk Level: low — This is a routine quarterly financial filing and does not inherently present new risks.

Key Numbers

• 20240630 — Reporting Period End (Indicates the end date of the financial reporting period.)
• 20240808 — Filing Date (The date the 10-Q was officially submitted to the SEC.)

Key Players & Entities

• ROYAL GOLD INC (company) — Filer
• 20240630 (date) — Reporting period end date
• 20240808 (date) — Filing date
• DENVER (location) — Company headquarters city

FAQ

Key Financial Figures

• $0.01 — ange on which Registered Common Stock, $0.01 par value RGLD Nasdaq Global Select Ma

Filing Documents

• rgld-20240630.htm (10-Q) — 1319KB
• rgld-20240630xex101.htm (EX-10.1) — 14KB
• rgld-20240630xex311.htm (EX-31.1) — 10KB
• rgld-20240630xex312.htm (EX-31.2) — 10KB
• rgld-20240630xex321.htm (EX-32.1) — 5KB
• rgld-20240630xex322.htm (EX-32.2) — 5KB
• 0000085535-24-000029.txt ( ) — 6331KB
• rgld-20240630.xsd (EX-101.SCH) — 36KB
• rgld-20240630_cal.xml (EX-101.CAL) — 49KB
• rgld-20240630_def.xml (EX-101.DEF) — 127KB
• rgld-20240630_lab.xml (EX-101.LAB) — 427KB
• rgld-20240630_pre.xml (EX-101.PRE) — 290KB
• rgld-20240630_htm.xml (XML) — 1216KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) Consolidated Balance Sheets 3 Consolidated Statements of Operations and Comprehensive Income 4 Consolidated Statements of Changes in Stockholders' Equity 5 Consolidated Statements of Cash Flows 6

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 30 Item 4.

Controls and Procedures

Controls and Procedures 30 PART II OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 30 Item 1A.

Risk Factors

Risk Factors 30 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 31 Item 3. Defaults Upon Senior Securities 31 Item 4. Mine Safety Disclosure s 31 Item 5. Other Information 31 Item 6. Exhibits 32

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS ROYAL GOLD, INC. Consolidated Balance Sheets (Unaudited, amounts in thousands except share data) June 30, 2024 December 31, 2023 ASSETS Cash and equivalents $ 74,232 $ 104,167 Royalty receivables 40,338 48,884 Income tax receivable 5,637 2,676 Stream inventory 10,904 9,788 Prepaid expenses and other 2,387 1,911 Total current assets 133,498 167,426 Stream and royalty interests, net (Note 3) 3,053,988 3,075,574 Other assets 81,535 118,057 Total assets $ 3,269,021 $ 3,361,057 LIABILITIES Accounts payable $ 13,227 $ 11,441 Dividends payable 26,314 26,292 Current portion of long-term debt (Note 4) 50,000 — Income tax payable 18,103 15,557 Other current liabilities 14,739 19,132 Total current liabilities 122,383 72,422 Debt (Note 4) — 245,967 Deferred tax liabilities 133,351 134,299 Mount Milligan deferred liability (Note 5) 25,000 — Other liabilities 7,094 7,728 Total liabilities 287,828 460,416 Commitments and contingencies (Note 12) EQUITY Preferred stock, $ .01 par value, 10,000,000 shares authorized; and 0 shares issued — — Common stock, $ .01 par value, 200,000,000 shares authorized; and 65,656,625 and 65,631,760 shares outstanding, respectively 656 656 Additional paid-in capital 2,225,942 2,221,039 Accumulated earnings 742,270 666,522 Total Royal Gold stockholders' equity 2,968,868 2,888,217 Non-controlling interests 12,325 12,424 Total equity 2,981,193 2,900,641 Total liabilities and equity $ 3,269,021 $ 3,361,057 The accompanying notes are an integral part of these consolidated financial statements. 3 ROYAL GOLD, INC. Consolidated Statements of Operations and Comprehensive Income (Unaudited, amounts in thousands except share data) Three Months Ended Six Months Ended June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023 Revenue (Note 6) $ 174,096 $ 144,042 $ 322,999 $ 314,434 Costs and expenses Cost of sales (excludes depreciation, depletion and amortization) 24,174 23,367 45,924

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) 1. OPERATIONS, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING STANDARDS Royal Gold, Inc., together with its subsidiaries ("Royal Gold," the "Company," "we," "us," or "our"), is engaged in the business of acquiring and managing precious metals streams, royalties and similar interests. We seek to acquire existing stream and royalty interests or to finance projects that are in production or in the development stage in exchange for stream or royalty interests. A metal stream is a purchase agreement that provides, in exchange for an upfront deposit payment, the right and obligation to purchase all or a portion of one or more metals produced from a mine at a price determined for the life of the transaction by the purchase agreement. Royalties are non-operating interests in a mining project that provide the right to revenue or metals produced from the project after deducting contractually specified costs, if any. Summary of Significant Accounting Policies The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, all adjustments which are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in this Form 10-Q. Operating results for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the calendar year ending December 31, 2024. These interim unaudited consolidated financial statements should be read in conjunction with our Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchan

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) 3. STREAM AND ROYALTY INTERESTS, NET The following tables summarize our stream and royalty interests, net as of June 30, 2024 and December 31, 2023. As of June 30, 2024 (Amounts in thousands): Cost Accumulated Depletion Net Production stage stream interests: Mount Milligan $ 790,635 $ ( 446,143 ) $ 344,492 Pueblo Viejo 610,404 ( 303,712 ) 306,692 Andacollo 388,182 ( 171,396 ) 216,786 Khoemac a u 265,911 ( 51,179 ) 214,732 Rainy River 175,727 ( 80,377 ) 95,350 Other 237,059 ( 144,268 ) 92,791 Total production stage stream interests 2,467,918 ( 1,197,075 ) 1,270,843 Production stage royalty interests: Cortez (Legacy Zone and CC Zone) 353,850 ( 71,850 ) 282,000 Voisey's Bay 205,724 ( 122,401 ) 83,323 Red Chris 116,187 ( 5,966 ) 110,221 Peasquito 99,172 ( 62,459 ) 36,713 Other 462,695 ( 413,211 ) 49,484 Total production stage royalty interests 1,237,628 ( 675,887 ) 561,741 Total production stage stream and royalty interests 3,705,546 ( 1,872,962 ) 1,832,584 Development stage stream interests: Other 12,038 — 12,038 Development stage royalty interests: Ct 45,421 — 45,421 Back River 42,948 — 42,948 La Fortuna 35,140 — 35,140 Other 32,892 — 32,892 Total development stage stream and royalty interests 168,439 — 168,439 Exploration stage stream interests: Xavantina 16,313 — 16,313 Exploration stage royalty interests: Cortez (Legacy Zone and CC Zone) 456,479 — 456,479 Great Bear 209,106 — 209,106 Pascua-Lama 177,690 — 177,690 Red Chris 48,895 — 48,895 Ct 29,610 — 29,610 Other 114,872 — 114,872 Total exploration stage stream and royalty interests 1,052,965 — 1,052,965 Total stream and royalty interests, net $ 4,926,950 $ ( 1,872,962 ) $ 3,053,988 8 ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) As of December 31, 2023 (Amounts in thousands): Cost Accumulated Depletion Net Production stage stream interests: Mount Milligan $ 790,635 $ ( 430,106 ) $ 360,529 Pueblo Viejo 610,404 ( 299,354 ) 311,050 Andacollo 388,182 ( 165,553 ) 222,629 Khoemac a u 265,911 ( 41,635 ) 224,276 Rainy River 175,727 ( 74,858 ) 100,869 Other 232,703 ( 132,043 ) 100,660 Total production stage stream interests 2,463,562 ( 1,143,549 ) 1,320,013 Production stage royalty interests: Cortez (Legacy Zone and CC Zone) 353,850 ( 61,891 ) 291,959 Voisey's Bay 205,724 ( 121,000 ) 84,724 Red Chris 116,187 ( 3,758 ) 112,429 Peasquito 99,172 ( 59,900 ) 39,272 Other 448,899 ( 408,522 ) 40,377 Total production stage royalty interests 1,223,832 ( 655,071 ) 568,761 Total production stage stream and royalty interests 3,687,394 ( 1,798,620 ) 1,888,774 Development stage stream interests: Other 12,038 — 12,038 Development stage royalty interests: Ct 45,421 — 45,421 La Fortuna 35,140 — 35,140 Other 45,992 — 45,992 Total development stage stream and royalty interests 138,591 — 138,591 Exploration stage stream interests: Xavantina 19,565 — 19,565 Exploration stage royalty interests: Cortez (Legacy Zone and CC Zone) 456,479 — 456,479 Great Bear 209,106 — 209,106 Pascua-Lama 177,690 — 177,690 Red Chris 48,895 — 48,895 Ct 29,610 — 29,610 Other 106,864 — 106,864 Total exploration stage royalty interests 1,048,209 — 1,048,209 Total stream and royalty interests, net $ 4,874,194 $ ( 1,798,620 ) $ 3,075,574 9 ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) 4. DEBT Our debt as of June 30, 2024 and December 31, 2023 consists of the following (amounts in thousands): As of June 30, 2024 As of December 31, 2023 Principal Debt Issuance Costs (1) Total Principal Debt Issuance Costs Total Current portion of long-term debt $ 50,000 $ — $ 50,000 $ — $ — $ — Long-term debt $ — $ — $ — $ 250,000 $ ( 4,033 ) $ 245,967 Total debt $ 50,000 $ — $ 50,000 $ 250,000 $ ( 4,033 ) $ 245,967 _______________________________________________ (1) Debt issuance costs of $ 3.6 million included within Other assets on our consolidated balance sheets. Revolving credit facility For the six months ended June 30, 2024, we repaid a total of $ 200 million on our outstanding revolving credit facility. As of June 30, 2024, we had $ 50 million outstanding and $ 950 million available under our revolving credit facility. The interest rate on borrowings under our revolving credit facility as of June 30, 2024, was Term SOFR plus 1.20 % for an all-in rate of 6.5 %. Interest expense, which includes interest on outstanding borrowings and amortization of debt issuance costs, was $ 1.7 million and $ 5.6 million for the three and six months ended June 30, 2024, respectively, and $ 7.8 million and $ 16.3 million for the three and six months ended June 30, 2023, respectively. We were in compliance with each financial covenant (leverage ratio and interest coverage ratio) under our revolving credit facility as of June 30, 2024. On July 10, 2024, we repaid $ 25 million on our outstanding revolving credit facility, and on August 12, 2024, we plan to pay the remaining outstanding balance. We may repay any borrowings under our revolving credit facility at any time without premium or penalty. 5. MOUNT MILLIGAN DEFERRED LIABILITY On February 13, 2024, RGLD Gold AG, a subsidiary of the Company, entered into a Processing Cost Support Agreement (the "Mount Milligan Cost Support Agreement") with Centerra G

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) When the Deferred Gold Consideration is received and subsequently sold, we anticipate the value of the gold ounces sold will be recorded as a deferred liability and amortized on a units of production basis over the mine life of Mount Milligan as we provide future cost support. Cost Support Metal deliveries referenced in the Mount Milligan Cost Support Agreement are those with a bill of lading date on or after January 1, 2024 (the "Reference Date"). Delivery thresholds used to define the periods of cost support are the earlier deliveries of: a. 375,000 ounces of gold or 30,000 tonnes of copper from the Reference Date (the "First Threshold"). b. 665,000 ounces of gold or 60,000 tonnes of copper from the Reference Date (the "Second Threshold"). Near-Term Cost Support Through Approximately 2029 At Centerra's request, in the event that both the gold price is at or below $ 1,600 per ounce and the copper price is at or below $ 3.50 per pound, for each delivery under the existing Mount Milligan stream agreement, we will pay the lower of either $ 415 per ounce of gold, or 66 % of the spot gold price less $ 435 per ounce, and 35 % of the spot copper price for each pound of copper delivered (the "Pre-Threshold Support"). This near-term cost support will be made available from the Reference Date through to the First Threshold, which is expected to be through approximately 2029. Any Pre-Threshold Support we provide will be recoverable from any cost support calculated after the First Threshold at metal prices above $ 1,600 per ounce of gold and $ 3.50 per pound of copper. For gold, any cost support payment will be reduced by the difference between the gold price and $ 1,600 per ounce. For copper, any cost support payment will be reduced by the difference between the copper price and $ 3.50 per pound. Cost Support from Approximately 2030 Through Approximately 2035 We will provide Centerra cost support payments from

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) 6. REVENUE Revenue Recognition A performance obligation is a promise in a contract to transfer control of a distinct good or service (or integrated package of goods and/or services) to a customer. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, a performance obligation is satisfied. In accordance with this guidance, revenue attributable to our stream interests and royalty interests is generally recognized at the point in time that control of the related metal production transfers to our customers. The amount of revenue we recognize further reflects the consideration to which we are entitled under the respective stream or royalty agreement. A more detailed summary of our revenue recognition policies for our stream and royalty interests is discussed below. Stream Interests A metal stream is a purchase agreement that provides, in exchange for an upfront deposit payment, the right and obligation to purchase all or a portion of one or more of the metals produced from a mine, at a price determined for the life of the transaction by the purchase agreement. Gold, silver and copper received under our metal streaming agreements are taken into inventory, and then sold primarily at cash average or spot market prices. The sales price for the averaging contracts is determined by the average daily gold, silver or copper spot prices during the term of the contract, typically a consecutive period between ten days and three months (depending on the frequency of deliveries under the respective streaming agreement and our sales policy in effect at the time), commencing shortly after receipt and purchase of the metal. We settle both averaging and spot sales contracts via physical delivery of the metal to the purchaser (our customer) on the settlement date specified in the contract. Under our sales contracts, there is a single performance obligation to

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