What changed in this filing

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Item 1. Financial Statements

2024-05-09 compared with 2023-11-02 · 211 added, 184 removed, 280 unchanged (59% of the section changed)

3 unchanged sentences

(Unaudited, amounts in thousands except share data)

September 30,

2024 December 31,

Cash and equivalents $ 137,950 $ 104,167

5 unchanged sentences

Stream and royalty interests, net (Note 2) 3,038,495 3,075,574

Other assets 81,765 118,057

Total assets $ 3,313,308 $ 3,361,057

Accounts payable $ 11,599 $ 11,441

5 unchanged sentences

Deferred tax liabilities 133,934 134,299

Mount Milligan support liability (Note 4) 25,000 —

Other liabilities 7,676 7,728

9 unchanged sentences

Non-controlling interests 12,312 12,424

Total equity 2,923,366 2,900,641

Total liabilities and equity $ 3,313,308 $ 3,361,057

4 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Revenue (Note 5) $ 148,902 $ 170,392

23 unchanged sentences

Consolidated Statements of Changes in Stockholders’ Equity

Three months ended September 30, 2023, and 2022

(unaudited, amounts in thousands except share data)

Royal Gold Stockholders

Common Shares

Non-controlling

Balance at June 30, 2023

Stock-based compensation and related share issuances

Distributions to non-controlling interests

Net income and comprehensive income

Dividends declared

Balance at September 30, 2023

Royal Gold Stockholders

Common Shares

Non-controlling

Balance at June 30, 2022

Stock-based compensation and related share issuances

Distributions to non-controlling interests

Net income and comprehensive income

Dividends declared

Balance at September 30, 2022

ROYAL GOLD, INC.

Consolidated Statements of Changes in Stockholders’ Equity

Nine months ended September 30, 2023, and 2022

Three months ended March 31, 2024, and 2023

(unaudited, amounts in thousands except share data)

Royal Gold Stockholders

Common Shares

Non-controlling

Common Shares Additional

Capital Accumulated

Earnings Non-controlling

Interests Total

Shares Amount

Balance at December 31, 2023 65,631,760 $ 656 $ 2,221,039 $ 666,522 $ 12,424 $ 2,900,641

3 unchanged sentences

Dividends declared — — — ( 26,311 ) — ( 26,311 )

Balance at September 30, 2023

Balance at March 31, 2024 65,648,831 $ 656 $ 2,223,021 $ 687,377 $ 12,312 $ 2,923,366

Royal Gold Stockholders

Common Shares

Non-controlling

Common Shares Additional

Capital Accumulated

Earnings Non-controlling

Interests Total

Shares Amount

Balance at December 31, 2022 65,592,597 $ 656 $ 2,213,123 $ 527,314 $ 12,376 $ 2,753,469

3 unchanged sentences

Dividends declared — — — ( 24,644 ) — ( 24,644 )

Balance at September 30, 2022

Balance at March 31, 2023 65,599,348 $ 656 $ 2,215,362 $ 566,545 $ 12,369 $ 2,794,932

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

(Unaudited, amounts in thousands)

Nine Months Ended

September 30,

Three Months Ended

2024 March 31,

Cash flows from operating activities:

4 unchanged sentences

Fair value changes in equity securities ( 447 ) ( 799 )

Deferred tax benefit

Deferred tax expense 648 1,092

Other 222 214

Changes in assets and liabilities:

5 unchanged sentences

Income tax payable 6,465 ( 7,840 )

Mount Milligan support liability 25,000 —

Other liabilities ( 1,652 ) ( 2,168 )

2 unchanged sentences

Acquisition of stream and royalty interests ( 1,104 ) —

Sale of equity securities

Net cash used in investing activities

Proceeds from Khoemac a u debt facility

Other ( 305 ) ( 197 )

Net cash provided by (used in) investing activities $ 23,591 $ ( 197 )

Cash flows from financing activities:

Repayment of debt ( 100,000 ) ( 75,000 )

Borrowings from revolving credit facility

Debt issuance costs

Net payments from issuance of common stock ( 1,369 ) ( 397 )

Common stock dividends ( 26,292 ) ( 24,629 )

Net cash (used in) provided by financing activities

Net decrease in cash and equivalents

Other ( 431 ) ( 202 )

Net cash used in financing activities $ ( 128,092 ) $ ( 100,228 )

Net increase in cash and equivalents 33,783 8,230

Cash and equivalents at beginning of period 104,167 118,586

6 unchanged sentences

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 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.

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.

2 unchanged sentences

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 under the Securities Exchange Act of 1934, as amended.

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.

1 unchanged sentence

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 nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the calendar year ending December 31, 2023.

Operating results for the three months ended March 31, 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 Exchange Commission (“SEC”) on February 15, 2024 (“2023 10-K”).

4 unchanged sentences

STREAM AND ROYALTY INTERESTS, NET

The following tables summarize our stream and royalty interests, net as of September 30, 2023 and December 31, 2022.

As of September 30, 2023 (Amounts in thousands):

Accumulated Depletion

The following tables summarize our stream and royalty interests, net as of March 31, 2024 and December 31, 2023.

As of March 31, 2024 (Amounts in thousands):

Cost Accumulated Depletion Net

Production stage stream interests:

Mount Milligan $ 790,635 $ ( 437,053 ) $ 353,582

Total production stage stream interests

Pueblo Viejo 610,404 ( 301,590 ) 308,814

Andacollo 388,182 ( 168,789 ) 219,393

265,911 ( 47,415 ) 218,496

Rainy River 175,727 ( 77,698 ) 98,029

Other 237,059 ( 138,405 ) 98,654

Total production stage stream interests 2,467,918 ( 1,170,950 ) 1,296,968

Production stage royalty interests:

Cortez (Legacy Zone and CC Zone) 353,850 ( 67,166 ) 286,684

Voisey's Bay 205,724 ( 121,664 ) 84,060

Red Chris 116,187 ( 5,966 ) 110,221

Peñasquito 99,172 ( 61,240 ) 37,932

Other 448,899 ( 410,318 ) 38,581

Total production stage royalty interests 1,223,832 ( 666,354 ) 557,478

Total production stage stream and royalty interests 3,691,750 ( 1,837,304 ) 1,854,446

( 1,758,614 )

Development stage stream interests:

Other 12,038 — 12,038

Development stage royalty interests:

Côté 45,421 — 45,421

La Fortuna 35,140 — 35,140

Other 47,584 — 47,584

Total development stage stream and royalty interests 140,183 — 140,183

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

Côté 29,610 — 29,610

Other 105,773 — 105,773

Total exploration stage stream and royalty interests 1,043,866 — 1,043,866

Total stream and royalty interests, net $ 4,875,799 $ ( 1,837,304 ) $ 3,038,495

( 1,758,614 )

ROYAL GOLD, INC.

1 unchanged sentence

As of December 31, 2023 (Amounts in thousands):

Accumulated Depletion

Cost Accumulated Depletion Net

Production stage stream interests:

Mount Milligan $ 790,635 $ ( 430,106 ) $ 360,529

Total production stage stream interests

Pueblo Viejo 610,404 ( 299,354 ) 311,050

Andacollo 388,182 ( 165,553 ) 222,629

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

Peñasquito 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

( 1,634,113 )

Development stage stream interests:

Other 12,038 — 12,038

Development stage royalty interests:

Côté 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

Côté 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

( 1,634,113 )

Our debt as of September 30, 2023 and December 31, 2022 consists of the following (amounts in thousands):

As of September 30, 2023

As of December 31, 2022

Debt Issuance Costs

(Amounts in thousands)

Revolving credit facility

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Our debt as of March 31, 2024 and December 31, 2023 consists of the following (amounts in thousands):

As of March 31, 2024 As of December 31, 2023

Principal Debt Issuance Costs Total Principal Debt Issuance Costs Total

Revolving credit facility $ 150,000 $ ( 3,813 ) $ 146,187 $ 250,000 $ ( 4,033 ) $ 245,967

On March 6, June 6, and September 6, 2023, we repaid $ 75 million, $ 100 million, and $ 75 million, respectively, on our revolving credit facility.

On June 28, 2023, we entered into a fifth amendment to our revolving credit facility dated as of June 2, 2017, as amended.

The fifth amendment extended the scheduled maturity date from July 7, 2026 to June 28, 2028, replaced LIBOR with Secured Overnight Financing Rate (“Term SOFR”) as a benchmark interest rate and made certain other administrative changes to the existing revolving credit facility.

As of September 30, 2023, we had $ 325 million outstanding and $ 675 million available under our revolving credit facility.

The interest rate on borrowings under our revolving credit facility as of September 30, 2023, was Term SOFR plus 1.20 % for an all-in rate of 6.7 %.

Interest expense, which includes interest on outstanding borrowings and amortization of debt issuance costs, was $ 6.7 million and $ 23.0 million for the three and nine months ended September 30, 2023, respectively, and $ 3.9 million and $ 4.4 million for the three and nine months ended September 30, 2022, respectively.

We were in compliance with each financial covenant (leverage ratio and interest coverage ratio) under our revolving credit facility as of September 30, 2023.

Total debt $ 150,000 $ ( 3,813 ) $ 146,187 $ 250,000 $ ( 4,033 ) $ 245,967

Revolving credit facility

As of March 31, 2024, we had $ 150 million outstanding and $ 850 million available under our revolving credit facility.

The interest rate on borrowings under our revolving credit facility as of March 31, 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 $ 3.9 million and $ 8.5 million for the three months ended March 31, 2024 and 2023, respectively.

We were in compliance with each financial covenant (leverage ratio and interest coverage ratio) under our revolving credit facility as of March 31, 2024.

We repaid $ 100 million, $ 25 million and $ 50 million of our outstanding revolving credit facility on March 6, 2024, April 8, 2024 and May 8, 2024, respectively.

We may repay any borrowings under our revolving credit facility at any time without premium or penalty.

MOUNT MILLIGAN SUPPORT 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 Gold Inc.

("Centerra") with respect to the Mount Milligan Mine ("Mount Milligan") for cash consideration of $ 24.5 million, 50,000 ounces ("Deferred Gold Consideration") of gold to be delivered in the future and a free cash flow interest.

The cost support allowed for the extension of the mine from 2032 to 2035 and the potential to extend the mine life beyond 2035.

The value of the cash consideration and free cash flow interest received from Centerra, $ 25 million, have been recorded as a deferred liability in our consolidated balance sheets as of March 31, 2024.

This amount will be amortized as we provide future cost support to Centerra under the Mount Milligan Cost Support Agreement on a units of production basis over the Mount Milligan mine life beginning with the first cost support payment made after the First Threshold (defined below) is met.

The key features of the Mount Milligan Cost Support Agreement are discussed below.

Deferred Gold Consideration

The Deferred Gold Consideration will be delivered in equal installments of 2,500 ounces for a period of 20 quarters commencing on the earlier of June 30, 2030, or the delivery of 375,000 ounces of gold or 30,000 tonnes of copper from metal deliveries referenced by the Mount Milligan Cost Support Agreement with a bill of lading date on or after January 1, 2024.

As part of the Deferred Gold Consideration, we are entitled to receive three tranches of 11,111 ounces each (the "Greenstone Deliveries"), with the last delivery expected before year end 2027.

Each of the Greenstone Deliveries received shall reduce the number of ounces in any remaining Deferred Gold Consideration delivery on a pro-rata basis.

The Deferred Gold Consideration deliveries require no cash payment from the Company, and will be made irrespective of the operating status of Mount Milligan as long as we comply with the terms of the Mount Milligan Cost Support Agreement and existing stream agreement.

Each of the Greenstone Deliveries will be delivered to Royal Gold within 30 days of such delivery to Centerra.

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.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

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:

375,000 ounces of gold or 30,000 tonnes of copper from the Reference Date (the “First Threshold”).

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 the First Threshold until the Second Threshold as follows:

With respect to gold, the lower of either $ 415 per ounce, or 50 % of the spot gold price less $ 435 per ounce, for each ounce of gold delivered under the existing Mount Milligan stream agreement.

With respect to copper, 35 % of the spot copper price for each pound of copper delivered under the existing Mount Milligan stream agreement.

Cost Support After Approximately 2036

We will provide Centerra cost support payments after the Second Threshold as follows:

With respect to gold, the lower of either $ 615 per ounce, or 66 % of the spot gold price less $ 435 per ounce, for each ounce of gold delivered under the existing Mount Milligan stream agreement.

With respect to copper, 51 % of the spot copper price, for each pound of copper delivered.

Suspension of Cost Support

Our obligation to make long-term cost support payments will be suspended if (and for so long as) Centerra discloses reserve tonnage which, when combined with mining depletion from the Reference Date to the date of such disclosure, is less than the current reserves expected to be processed through to 2035.

Suspension of cost support payments will not impact the Deferred Gold Consideration and free cash flow interest, and the cash consideration is not refundable as long as we comply with the terms of the Mount Milligan Cost Support Agreement and the existing stream agreement.

Nothing in the Mount Milligan Cost Support Agreement modifies the existing stream agreement, including the payment of $ 435 for each gold ounce delivered and 15 % of the spot price for each pound of copper delivered.

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.

A contract’s transaction price is allocated to each distinct performance obligation

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

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.

2 unchanged sentences

Stream Interests

A metal stream is a purchase agreement that provides, in exchange for an upfront deposit payment, the right 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 using average spot rate gold, silver and copper forward contracts.

The sales price for these average spot rate forward contracts is determined by the average daily gold, silver or copper spot prices during the term of the contract, typically a consecutive number of trading days 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 our forward sales contracts via physical delivery of the metal to the purchaser (our customer) on the settlement date specified in the contract.

Under our forward sales contracts, there is a single performance obligation to sell a contractually specified volume of metal to the purchaser, and we satisfy this obligation at the point in time of physical delivery.

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 sell a contractually specified volume of metal to the purchaser, and we satisfy this obligation at the point in time of physical delivery.

Accordingly, revenue from our metal sales is recognized on the date of settlement, which is the date that control, custody and title to the metal transfer to the purchaser.

3 unchanged sentences

As a royalty holder, we act as a passive entity in the production and operations of the mining project, and the third-party operator of the mining project is responsible for all mining activities, including subsequent marketing and delivery of all metal production to their ultimate customer.

In all of our material royalty interest arrangements, we have concluded that we transfer control of our interest in the metal production to the operator at the

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

point at which production occurs, and thus, the operator is our customer.

In all of our material royalty interest arrangements, we have concluded that we transfer control of our interest in the metal production to the operator at the point at which production occurs, and thus, the operator is our customer.

We have further determined that the transfer of each unit of metal production comprising our royalty interest to the operator represents a separate performance obligation under the contract, and each performance obligation is satisfied at the point in time of metal production by the operator.

6 unchanged sentences

Please also refer to our “Use of Estimates” accounting policy discussed in our 2023 10-K.

For the three months ended September 30, 2023, royalty revenue that was estimated or was attributable to metal production for a period prior to September 30, 2023, was not material.

For the three months ended March 31, 2024, royalty revenue that was estimated or was attributable to metal production for a period prior to March 31, 2024, was not material.

Disaggregation of Revenue

2 unchanged sentences

These identified revenue sources are consistent with our reportable segments as discussed in Note 9.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Revenue by metal type attributable to each of our revenue sources is disaggregated as follows (amounts in thousands):

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Stream revenue:

Gold $ 78,277 $ 78,629

Silver 14,747 18,308

Copper 9,504 18,053

Total stream revenue $ 102,528 $ 114,990

Royalty revenue:

Gold $ 33,496 $ 42,868

Silver 4,328 2,946

Copper 3,621 5,058

Other 4,929 4,530

Total royalty revenue $ 46,374 $ 55,402

Total revenue $ 148,902 $ 170,392

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Revenue attributable to our principal stream and royalty interests is disaggregated as follows (amounts in thousands):

Three Months Ended

Nine Months Ended

September 30,

Metal(s) March 31,

2024 March 31,

Stream revenue:

Mount Milligan

Gold & Copper

Gold & Silver

Mount Milligan Gold & Copper $ 34,995 $ 46,656

Pueblo Viejo Gold & Silver 17,760 22,358

Andacollo Gold 11,689 12,934

Silver 7,758 9,153

Other Gold & Silver 30,326 23,889

Total stream revenue $ 102,528 $ 114,990

Royalty revenue:

Cortez Legacy Zone

Cortez CC Zone

Gold, Silver, Lead & Zinc

Cortez Legacy Zone Gold $ 13,365 $ 23,087

Cortez CC Zone Gold 4,411 3,206

Peñasquito Gold, Silver, Lead & Zinc 9,229 7,433

Other Various 19,369 21,676

Total royalty revenue $ 46,374 $ 55,402

Total revenue $ 148,902 $ 170,392

Peñasquito Revenue

During the three months ended September 30, 2023, no royalty revenue from Peñasquito was recognized due to the suspension of operations resulting from a strike action on June 7, 2023, by the National Union of Mine and Metal Workers of the Mexican Republic ("the Union").

According to Newmont Corporation (“Newmont”), on October 13, 2023, a definitive agreement was reached between Newmont and the Union that also received approval from the Mexican Labor Court, ramp-up of operations has since commenced, and operations at Peñasquito are expected to reach full operating capacity by the end of the fourth quarter of 2023.

Please refer to Note 9 for the geographical distribution of our revenue by reportable segment.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

STOCK-BASED COMPENSATION

1 unchanged sentence

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Restricted stock $ 1,971 $ 1,614

4 unchanged sentences

Stock-based compensation expense is included within General and administrative expense in the consolidated statements of operations and comprehensive income.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

During the three and nine months ended September 30, 2023 and 2022, we granted the following stock-based compensation awards:

During the three months ended March 31, 2024 and 2023, we granted the following stock-based compensation awards:

Three Months Ended

Nine Months Ended

September 30,

(Number of shares)

2024 March 31,

(Number of shares)

Performance stock (at maximum 200 % attainment)

93,840 82,360

Restricted Stock 65,850 56,530

Total equity awards granted 159,690 138,890

As of September 30, 2023, unrecognized compensation expense (expressed in thousands below) and weighted-average vesting period for each of our stock-based compensation awards were as follows:

As of March 31, 2024, unrecognized compensation expense (expressed in thousands below) and weighted-average vesting period for each of our stock-based compensation awards were as follows:

expense Weighted-

average vesting

9 unchanged sentences

Use of the two-class method has an immaterial impact on the calculation of basic and diluted EPS.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

The following table summarizes the effects of dilutive securities on diluted EPS for the periods shown below (amounts in thousands, except share data):

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Net income attributable to Royal Gold common stockholders $ 47,166 $ 63,875

2 unchanged sentences

Weighted-average shares for diluted EPS 65,740,260 65,709,095

Basic EPS $ 0.72 $ 0.97

Diluted EPS $ 0.72 $ 0.97

The following table provides the income tax expense (amounts in thousands) and effective tax rates for the periods indicated:

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Income tax expense $ 27,033 $ 15,871

Effective tax rate 36.4 % 19.9 %

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

The effective tax rates for the nine months ended September 30, 2023 and 2022, included discrete income tax benefits of $ 8.5 million and $ 18.8 million, respectively, attributable to the release of a valuation allowance on certain deferred tax assets.

The effective tax rate for the three months ended March 31, 2024, included a $ 13.0 million discrete U.S.

GILTI income tax expense related to the consideration from the Mount Milligan Cost Support Agreement.

SEGMENT INFORMATION

1 unchanged sentence

Our long-lived assets (stream and royalty interests, net) are geographically distributed as shown in the following table (amounts in thousands):

As of September 30, 2023

As of December 31, 2022

interests, net

As of March 31, 2024 As of December 31, 2023

interest Royalty

interest Total stream

interests, net Stream

interest Royalty

interest Total stream

interests, net

Canada $ 451,610 $ 612,428 $ 1,064,038 $ 461,398 $ 614,900 $ 1,076,298

Dominican Republic 308,814 — 308,814 311,050 — 311,050

Africa 255,704 321 256,025 264,529 321 264,850

Chile 219,392 224,116 443,508 222,629 224,116 446,745

United States — 789,467 789,467 — 794,891 794,891

Mexico — 39,245 39,245 — 41,803 41,803

Australia — 20,961 20,961 — 21,288 21,288

Rest of world 89,799 26,638 116,437 92,010 26,639 118,649

Total $ 1,325,319 $ 1,713,176 $ 3,038,495 $ 1,351,616 $ 1,723,958 $ 3,075,574

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Our reportable segments for purposes of assessing performance are shown below (amounts in thousands):

Three Months Ended September 30, 2023

Cost of sales (1)

Production taxes

Depletion (2)

Segment gross profit

Stream interests

Royalty interests

Three Months Ended September 30, 2022

Cost of sales (1)

Production taxes

Depletion (2)

Segment gross profit

Stream interests

Royalty interests

Nine Months Ended September 30, 2023

Cost of sales (1)

Production taxes

Depletion (2)

Three Months Ended March 31, 2024

Revenue Cost of sales (1)

Production taxes Depletion (2)

Segment gross profit

1 unchanged sentence

Royalty interests 46,374 — 1,449 11,282 33,643

Nine Months Ended September 30, 2022

Cost of sales (1)

Production taxes

Depletion (2)

Total $ 148,902 $ 21,751 $ 1,449 $ 38,683 $ 87,019

Three Months Ended March 31, 2023

Revenue Cost of sales (1)

Production taxes Depletion (2)

Segment gross profit

1 unchanged sentence

Royalty interests 55,402 — 1,989 12,462 40,951

Total $ 170,392 $ 25,020 $ 1,989 $ 46,214 $ 97,169

_______________________________________________

(1) Excludes depreciation, depletion and amortization.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

(2) Depletion amounts are included within Depreciation, depletion and amortization on our consolidated statements of operations and comprehensive income.

1 unchanged sentence

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Total segment gross profit $ 87,019 $ 97,169

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Income before income taxes $ 74,342 $ 79,942

Our revenue by reportable segment for the three and nine months ended September 30, 2023 and 2022 is geographically distributed as shown in the following table (amounts in thousands):

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Our revenue by reportable segment for the three months ended March 31, 2024 and 2023, is geographically distributed as shown in the following table (amounts in thousands):

Three Months Ended

Nine Months Ended

September 30,

2024 March 31,

Stream interests:

Canada $ 44,705 $ 56,981

Africa 19,101 17,539

Dominican Republic 17,760 22,358

Chile 11,689 12,934

Rest of world 9,273 5,178

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United States $ 24,079 $ 33,581

Mexico 10,768 9,295

Canada 5,131 6,591

Australia 4,975 4,099

Rest of world 1,421 1,836

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Quoted prices for identical instruments in active markets;

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

Quoted prices for similar instruments in active markets;

2 unchanged sentences

Prices or valuation techniques requiring inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

As of September 30, 2023 and December 31, 2022, we had financial assets in the form of marketable securities which are measured at fair value on a recurring basis;

As of March 31, 2024 and December 31, 2023, we had financial assets in the form of marketable securities which are measured at fair value on a recurring basis;

however, the carrying value of such financial assets is not material.

The carrying value of our revolving credit facility (Note 3) approximates fair value as of September 30, 2023.

As of September 30, 2023, we had assets that, under certain conditions, are subject to measurement at fair value on a non-recurring basis like those associated with stream and royalty interests, intangible assets and other long-lived assets.

The carrying value of our revolving credit facility (Note 3) approximates fair value as of March 31, 2024.

As of March 31, 2024, we had assets that, under certain conditions, are subject to measurement at fair value on a non-recurring basis like those associated with stream and royalty interests, intangible assets and other long-lived assets.

For these assets, measurement at fair value in periods subsequent to their initial recognition is applicable if any of these assets are determined to be impaired.

If recognition of these assets at their fair value becomes necessary, such measurements will be determined utilizing Level 3 inputs.

ROYAL GOLD, INC.

Notes to Consolidated Financial Statements

COMMITMENTS AND CONTINGENCIES

Xavantina Exploration Payment

On April 20, 2023, we made a $ 2.4 million advance payment to a subsidiary of Ero Copper Corp.

(“Ero”) as part of our commitment to support the achievement of success-based targets related to regional exploration and mineral resource additions.

This payment was recorded to exploration stage stream interests within Stream and royalty interests, net on our consolidated balance sheets.

Advance payments of $ 4.4 million remain if Ero meets certain success-based targets related to regional exploration and mineral resource additions through calendar 2024.

Refer to Note 3 of our 2022 10-K for further information on the Xavantina (formerly referred to as NX Gold) Gold Stream Acquisition.

Ilovica Gold Stream Acquisition

As of September 30, 2023, our conditional funding schedule of $ 163.75 million, as part of the Ilovica gold stream acquisition entered into in October 2014, remains subject to certain conditions.

As of March 31, 2024, our conditional funding schedule of $ 163.75 million, as part of the Ilovica gold stream acquisition entered into in October 2014, remains subject to certain conditions.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements