Sandstorm Gold Royalties Announces 2024 First Quarter Results
First Quarter Highlights
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Revenue of
$42.8 million (Q1 2023 —$44.0 million ); - Attributable gold equivalent ounces1 of 20,316 ounces (Q1 2023 — 28,368 ounces);
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Cash flows from operating activities, excluding changes in non-cash working capital1 of
$32.9 million (Q1 2023 —$42.7 million , which included a$10 million , one-time contractual payment from the Company's Mt.Hamilton royalty); -
Record cash operating margins1of
$1,782 per attributable gold equivalent ounce (Q1 2023 —$1,652 per ounce). -
Balance sheet and capital allocation update: The Company has continued to focus on de-levering its balance sheet and made
$20 million in net repayments on its revolving credit facility during the first quarter. Subsequent to quarter end, the Company announced the sale of select non-core, non-precious metals assets for$21.0 million in cash as well as the renewal of its Normal Course Issuer Bid.- Sale of select non-core, non-precious metals assets: In May, the Company announced it had signed a definitive purchase agreement with
Evolve Strategic Element Royalties Ltd. to sell a package of royalties (including Highland Valley Copper,Seymour Lake , and any future royalty proceeds exceeding$10 million fromCopper Mountain ) (the "Evolve Transaction") for cash consideration of$21.0 million . The Evolve Transaction is expected to close within the second quarter of 2024. Upon completion of the Evolve Transaction, Sandstorm will have completed the sale of over$50 million of non-core royalty and equity investments since the third quarter of 2023, which includes cash consideration of approximately$40 million . While further monetization of the Company's investment portfolio is possible, subject to market conditions, the Company does not intend to monetize further royalty or stream assets. For further details about the Evolve Transaction, see the Company's press release datedMay 2, 2024 . - Renewal of Normal Course Issuer Bid: In conjunction with accelerated deleveraging driven by recent non-core asset sales and the current commodity price environment, Sandstorm announced in May that the Board of Directors has approved the use of the renewed Normal Course Issuer Bid, which allows the Company to purchase up to 20 million of its common shares from time to time when management believes the common shares are undervalued by the market.
- Sale of select non-core, non-precious metals assets: In May, the Company announced it had signed a definitive purchase agreement with
Outlook
Based on the Company's existing streams and royalties, attributable gold equivalent ounces for 2024 are forecasted to be between 75,000 and 90,000 ounces. The Company's production forecast is expected to reach approximately 125,000 attributable gold equivalent ounces within the next five years.
Financial Results
For the three months ended
Cash flows from operating activities were
Streams & Royalties
Of the gold equivalent ounces sold by the Company during the first quarter of 2024, approximately 13% were attributable to mines located in
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THREE MONTHS ENDED |
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Revenue |
Gold Equivalent |
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2,652 |
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3,103 |
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9,122 |
Other |
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5,439 |
Total |
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20,316 |
Streams and royalties on Canadian mines contributed approximately the same number of gold equivalent ounces to Sandstorm when compared to the first quarter of 2023. An increase in gold equivalent ounces sold from the Black Fox mine in
North America Excluding Canada
Gold equivalent ounces sold from operations located within
Operations in
Other
Streams and royalties on mines in other countries contributed 88% more gold equivalent ounces sold when compared to the first quarter of 2023. This change was driven by an increase in attributable gold equivalent ounces sold from the Bonikro mine in Côte d'Ivoire, partially due to the timing of sales, as well as an increase in royalty revenue attributable to the Ivrindi royalty in Türkiye.
Webcast & Conference Call Details
A conference call will be held on
International: (+1) 416-764-8688
North American Toll-Free: (+1) 888-390-0546
Conference ID: 45071219
Webcast URL: https://app.webinar.net/8rgZJmKlkYo
Note 1 |
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Sandstorm has included certain performance measures in this press release that do not have any standardized meaning prescribed by International Financial Reporting Standards Accounting Standards as issued by the |
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(i) |
Total sales, royalties and income from other interests is a non-IFRS financial measure and is calculated by taking total revenue which includes sales and royalty revenue, and adding contractual income relating to royalties, streams and other interests excluding gains and losses on dispositions. The Company presents Total Sales, Royalties and Income from other interests as it believes that certain investors use this information to evaluate the Company's performance and ability to generate cash flow in comparison to other streaming and royalty companies in the precious metals mining industry. |
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(ii) |
Attributable gold equivalent ounce is a non-IFRS financial ratio that uses total sales, royalties, and income from other interests as a component. Attributable gold equivalent ounce is calculated by dividing the Company's total sales, royalties, and income from other interests, less revenue attributable to non-controlling shareholders for the period, by the average realized gold price per ounce from the Company's gold streams for the same respective period. The Company presents Attributable Gold Equivalent ounce as it believes that certain investors use this information to evaluate the Company's performance in comparison to other streaming and royalty companies in the precious metals mining industry that present results on a similar basis. |
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(iii) |
Average cash cost per attributable gold equivalent ounce is calculated by dividing the Company's cost of sales, excluding depletion by the number of attributable gold equivalent ounces. The Company presents average cash cost per Attributable Gold Equivalent ounce as it believes that certain investors use this information to evaluate the Company's performance and ability to generate cash flow in comparison to other streaming and royalty companies in the precious metals mining industry who present results on a similar basis. |
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(iv) |
Cash operating margin is calculated by subtracting the average cash cost per attributable gold equivalent ounce from the average realized gold price per ounce from the Company's gold streams. The Company presents cash operating margin as it believes that certain investors use this information to evaluate the Company's performance and ability to generate cash flow in comparison to other streaming and royalty companies in the precious metals mining industry that present results on a similar basis. |
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(v) |
Cash flows from operating activities excluding changes in non-cash working capital is a non-IFRS financial measure that is calculated by adding back the decrease or subtracting the increase in changes in non-cash working capital to or from cash provided by (used in) operating activities. The Company presents cash flows from operating activities excluding changes in non-cash working capital as it believes that certain investors use this information to evaluate the Company's performance in comparison to other streaming and royalty companies in the precious metals mining industry that present results on a similar basis. |
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Refer to pages 31–33 of the Company's MD&A for the quarter ended |
Contact Information
For more information about Sandstorm Gold Royalties, please visit our website at www.sandstormgold.com or email us at info@sandstormgold.com.
ABOUT SANDSTORM GOLD ROYALTIES
Sandstorm is a precious metals-focused royalty company that provides upfront financing to mining companies and receives the right to a percentage of production from a mine, for the life of the mine. Sandstorm holds a portfolio of approximately 240 royalties, of which 40 of the underlying mines are producing. Sandstorm plans to grow and diversify its low cost production profile through the acquisition of additional gold royalties. For more information visit: www.sandstormgold.com.
CAUTIONARY STATEMENTS TO
The financial information included or incorporated by reference in this press release or the documents referenced herein has been prepared in accordance with International Financial Reporting Standards as issued by the
This press release and the documents incorporated by reference herein, as applicable, have been prepared in accordance with Canadian standards for the reporting of mineral resource and mineral reserve estimates, which differ from the previous and current standards of
For
As a result of the adoption of the SEC Modernization Rules, the
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This press release contains "forward-looking statements", within the meaning of the
Forward-looking statements are made based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performances or achievements of Sandstorm Gold Royalties to be materially different from future results, performances or achievements expressed or implied by such statements. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which Sandstorm Gold Royalties will operate in the future, including the receipt of all required approvals, the price of gold and copper and anticipated costs. Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements include, amongst others, failure to receive necessary approvals, changes in business plans and strategies, market conditions, share price, best use of available cash, gold and other commodity price volatility, discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and development risks relating to the parties which produce the gold or other commodity the Company will purchase, regulatory restrictions, activities by governmental authorities (including changes in taxation), currency fluctuations, the global economic climate, dilution, share price volatility and competition.
Forward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: the impact of general business and economic conditions, the absence of control over mining operations from which the Company will purchase gold, other commodities or receive royalties from, and risks related to those mining operations, including risks related to international operations, government and environmental regulation, actual results of current exploration activities, conclusions of economic evaluations and changes in project parameters as plans continue to be refined, risks in the marketability of minerals, fluctuations in the price of gold and other commodities, fluctuation in foreign exchange rates and interest rates, stock market volatility, as well as those factors discussed in the section entitled "Risks to Sandstorm" in the Company's annual report for the financial year ended
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