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Item 7. Management’s Discussion and Analysis

2025-02-13 compared with 2024-02-15 · 125 added, 152 removed, 157 unchanged (64% of the section changed)

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General Presentation

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) generally discusses year-to-year comparisons between the year ended December 31, 2023 and the year ended December 31, 2022.

Due to our change in fiscal year from June 30 to December 31, the comparative year ended December 31, 2021 was unaudited.

A discussion of the changes in our financial condition and results of operations for the year ended December 31, 2022, the six month transition period ended December 31, 2021 and fiscal year ended June 30, 2021 has been omitted from this report, but may be found in Item 7.

MD&A, of our Annual Reports on Form 10-K for the year ended December 31, 2022, the six month transition period ended December 31, 2021 and the year ended June 30, 2021, filed with the SEC on February 16, 2023, February 17, 2022 and August 12, 2021, respectively, which are available free of charge on the SEC’s website at www.sec.gov and our website at www.royalgold.com.

This Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, generally discusses year-to-year comparisons between the year ended December 31, 2024 and the year ended December 31, 2023.

A discussion of the changes in our financial condition and results of operations for the year ended December 31, 2022 has been omitted from this report, but may be found in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 15, 2024, which is available free of charge on the SEC’s website at www.sec.gov and our website at www.royalgold.com.

Overview of Our Business

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• Acquisition and Management of 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 metals produced from a mine, at a price determined for the life of the transaction by the purchase agreement.

As of December 31, 2023, we owned nine stream interests, which are on eight production stage properties and one development stage property.

Stream interests accounted for 69% of our total revenue for the years ended December 31, 2023 and 2022.

As of December 31, 2024, we owned nine stream interests, which are on seven production stage properties and two development stage properties.

Stream interests accounted for 67% and 69% of our total revenue for the years ended December 31, 2024 and 2023, respectively.

We expect stream interests to continue representing a significant portion of our total revenue.

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We use “evaluation stage” to describe exploration stage properties that contain mineral resources and on which operators are engaged in the search for mineral reserves.

Royalty interests accounted for 31% of our total revenue for the years ended December 31, 2023 and 2022 .

Royalty interests accounted for 33% and 31% of our total revenue for the years ended December 31, 2024 and 2023, respectively.

We do not conduct mining operations on the properties in which we hold stream and royalty interests, and we generally are not required to contribute to capital costs, exploration costs, environmental costs or other operating costs on those properties.

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Business Trends and Uncertainties

Acquisition of Cactus Project Royalty

On December 31, 2024, RG Royalties, LLC, a wholly-owned subsidiary of Royal Gold, acquired two royalties for cash consideration of $55 million that constitute an aggregate 2.5% net smelter return ("NSR") royalty (the “Cactus Royalty”) on the Cactus Project from a private seller.

The Cactus Project is being developed by Arizona Sonoran Copper Company Inc.

(“ASCU”), and is located in Arizona.

The Cactus Royalty covers the Cactus East and Cactus West deposits as well as portions of the Parks/Salyer deposit and is subject to a right in favor of ASCU, until July 10, 2025, to buy back 0.5% of the aggregate 2.5% royalty for $7 million.

The purchase price was funded with available cash on hand.

Please refer to Note 3 of the Notes to Consolidated Financial Statements for more information on the acquisition of the Cactus Royalty.

Acquisition of Back River Royalties

On June 26, 2024, International Royalty Corporation, a wholly-owned subsidiary of Royal Gold, acquired a 0.7% NSR royalty (the "Hill Royalty") that declines by 50% after $5 million Canadian dollars in royalty revenue is received, and a 26.25% interest in a 5% gross smelter return royalty (the "KM Royalty") that is payable after approximately 780,000 ounces have been produced on the Back River Gold Project ("Back River") for aggregate cash consideration of $51 million.

Payments for the Hill Royalty are deductible from the KM Royalty.

Back River is operated by B2Gold Corporation and is located in Western Nunavut, Canada.

The purchase price was funded with available cash on hand.

Please refer to Note 3 of the Notes to Consolidated Financial Statements for more information on the acquisition of the Back River royalties.

Our financial results are primarily tied to the price of gold, silver, copper, and other metals.

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For the years ended December 31, 2024, and 2023, the average prices and percentages of revenue by metal were as follows:

December 31, 2023

December 31, 2022

December 31, 2024 December 31, 2023

Metal Average

Price Percentage

of Revenue Average

Price Percentage

Gold ($/ounce) (1)

$ 2,386 76% $ 1,941 76%

Silver ($/ounce) (1)

$ 28.27 12% $ 23.35 12%

Copper ($/pound) (2)

$ 4.15 9% $ 3.85 9%

Other N/A 3% N/A 3%

(1) Based on the average LBMA Price for the period.

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Cost Support Agreement for Mount Milligan

On February 13, 2024, we entered into a Cost Support Agreement with Centerra to incentivize Centerra to continue to invest and maximize the value of the large mineral endowment at Mount Milligan.

The Cost Support Agreement is expected to provide a basis for a reserve increase and extension of the Mount Milligan mine life to 2035.

Please refer to Part I, Item 2, Properties, of this report for additional information regarding the Cost Support Agreement.

Operators’ Production Estimates by Stream and Royalty Interest for Calendar 2023

We received annual production estimates from many of the operators of our producing mines during the first calendar quarter of 2023.

In some instances, an operator may revise its original calendar year guidance throughout the year.

The following table shows these production estimates for our principal producing properties for calendar 2023 as well as the actual production reported to us by the various operators through December 31, 2023.

The estimates and production reports are prepared by the operators.

We do not participate in the preparation or calculation of the operators’ estimates or production reports and have not independently assessed or verified, and disclaim all responsibility for, the accuracy of this information.

Please refer to Part I, Item 2, Properties, of this report for further discussion on any updates at our principal producing properties.

Operators’ Estimated and Actual Production by Stream and Royalty Interest for Calendar Year 2023

Principal Production Stage Properties

Calendar Year 2023 Operator’s Production

Stream/Royalty

Andacollo (3)

22,000 - 27,000

Mount Milligan (4)

150,000 - 160,000

60 - 70 Million

Pueblo Viejo (5)

470,000 - 520,000

Khoemac a u (6)

1.5 - 1.7 Million

940,000 - 1,060,000

Peñasquito (8)

(1) Production estimates received from our operators are for calendar year 2023.

Please also refer to our cautionary language regarding forward-looking statements following this MD&A, as well as the Risk Factors identified in Part I, Item 1A, of this report for information regarding factors that could affect actual results.

(2) Actual production figures shown are from our operators and cover the period January 1, 2023, through December 31, 2023, unless otherwise noted in footnotes to this table.

Such amounts may differ from our reported revenue and production and are not reduced to show the production attributable to our interests.

(3) The estimated and actual production figures shown for Andacollo are contained gold in concentrate.

Deliveries to Royal Gold are determined using a fixed gold payability factor of 89%.

(4) The estimated and actual production figures shown for Mount Milligan are payable gold and copper in concentrate.

Deliveries to Royal Gold are determined using a fixed payability factor of 97% for gold and a minimum payability factor of 95% for copper.

Actual production figures are for the period January 1, 2023, through September 30, 2023.

(5) The estimated and actual production figures shown for Pueblo Viejo are payable gold in doré and represent the 60% interest in Pueblo Viejo held by Barrick.

Barrick did not provide estimated or actual silver production.

Deliveries to Royal Gold are determined using a fixed payability factors of 99.9% for gold and 99% for silver.

(6) The estimated and actual production figures for Khoemac a u are payable silver in concentrate.

Deliveries to Royal Gold are determined using a fixed silver payability factor of 90%.

(7) The estimated and actual production figures for Cortez include the entirety of the Cortez Complex.

Barrick reports production from the entirety of the Cortez Complex and does not report production separately for the Legacy Zone and CC Zone.

Production estimates for the Legacy Zone are provided to us by Barrick and production estimates for 100% of the Cortez Complex are publicly disclosed by Barrick.

(8) The gold and silver production figures shown for Peñasquito are payable gold and silver in concentrate and doré.

The lead and zinc production figures shown are payable lead and zinc in concentrate.

Actual production figures are for the period January 1, 2023 through September 30, 2023, and no production occurred during the third quarter of 2023 due to the suspension of operations resulting from a strike action on June 7, 2023.

Estimated production figures are not available as 2023 production guidance was withdrawn by Newmont on July 20, 2023, due to the suspension of operations

On February 13, 2024, we entered into a Cost Support Agreement with Centerra Gold Inc.

("Centerra") to incentivize Centerra to continue to invest and maximize the value of the large mineral endowment at Mount Milligan.

The Cost Support Agreement provided a basis for a reserve increase and extension of the Mount Milligan mine life to 2035 and may provide a basis for further extension of the mine life beyond 2035.

Please refer to Note 7 of the Notes to Consolidated Financial Statements of this report for additional information regarding the Cost Support Agreement.

Results of Operations

Year Ended December 31, 2023, Compared with Year Ended December 31, 2022 (In thousands, except share data)

For the year ended December 31, 2023, we recorded net income attributable to Royal Gold stockholders of $239.4 million, or $3.64 per basic share and $3.63 per diluted share, as compared to net income attributable to Royal Gold stockholders of $239.0 million, or $3.64 per basic and $3.63 per diluted share, for the year ended December 31, 2022.

For the year ended December 31, 2023, we recognized total revenue of $605.7 million, which is comprised of stream revenue of $418.3 million and royalty revenue of $187.4 million, at an average gold price of $1,941 per ounce, an average

silver price of $23.35 per ounce and an average copper price of $3.85 per pound, compared to total revenue of $603.2 million, which is comprised of stream revenue of $417.8 million and royalty revenue of $185.4 million, at an average gold price of $1,800 per ounce, an average silver price of $21.73 per ounce and an average copper price of $3.99 per pound, for the year ended December 31, 2022.

Year Ended December 31, 2024, Compared with Year Ended December 31, 2023

For the year ended December 31, 2024, we recorded net income attributable to Royal Gold stockholders of $332.0 million, or $5.04 per basic and diluted share, as compared to net income attributable to Royal Gold stockholders of $239.4 million, or $3.64 per basic and $3.63 per diluted share, for the year ended December 31, 2023.

For the year ended December 31, 2024, we recognized total revenue of $719.4 million, which is comprised of stream revenue of $483.3 million and royalty revenue of $236.1 million, at an average gold price of $2,386 per ounce, an average silver price of $28.27 per ounce and an average copper price of $4.15 per pound, compared to total revenue of $605.7 million, which is comprised of stream revenue of $418.3 million and royalty revenue of $187.4 million, at an average gold price of $1,941 per ounce, an average silver price of $23.35 per ounce and an average copper price of $3.85 per pound, for the year ended December 31, 2023.

Revenue and the corresponding production attributable to our stream and royalty interests, for the year ended December 31, 2024, compared to the year ended December 31, 2023, is as follows:

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(In thousands, except reported production in oz.

December 31, 2023

December 31, 2022

Stream/Royalty

Year Ended December 31, 2024 Year Ended December 31, 2023

Stream/Royalty Metal(s) Revenue Reported

Production (1)

Revenue Reported

Production (1)

Mount Milligan $ 186,039 $ 158,167

Gold 57,500 oz.

Copper 11.8 Mlbs.

Pueblo Viejo $ 83,059 $ 76,247

Gold 24,900 oz.

Silver 863,400 oz.

Andacollo Gold $ 47,531 20,000 oz.

$ 48,920 25,500 oz.

$ 166,665 $ 134,946

Gold 52,200 oz.

Silver 1.5 Moz.

Total stream revenue $ 483,294 $ 418,280

Royalty (2) :

Cortez Legacy Zone

Cortez CC Zone

Cortez Legacy Zone Gold $ 58,183 209,200 oz.

$ 79,920 396,000 oz.

Cortez CC Zone Gold 11,611 511,000 oz.

14,626 494,700 oz.

Various $ 166,307 N/A $ 92,891 N/A

Total royalty revenue $ 236,101 $ 187,437

Total Revenue $ 719,395 $ 605,717

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(1) Reported production relates to the amount of stream metal sales and the metal sales attributable to our royalty interests for the years ended December 31, 2024 and 2023, and may differ from the operators’ public reporting due to a number of factors, including the timing of the operator’s concentrate shipments, the delivery of metal to us and our subsequent sale of the delivered metal.

(2) Refer to Item 2, Properties, for further discussion on our principal stream and royalty interests.

(3) Individually, with the exception of the Rainy River stream (6.4% for the year ended December 31, 2023 and 5.3% for the year ended December 31, 2022) and Wassa (5.4% for the year ended December 31, 2023 and 5.2% for the year ended December 31, 2022), no stream or royalty included within the “Other” category contributed greater than 5% of our total revenue for either period.

The increase in our total revenue for the year ended December 31, 2023, compared with the year ended December 31, 2022, resulted primarily from higher gold production at the Cortez Legacy Zone, the new Cortez royalties acquired in 2022 and higher gold and silver prices when compared to the prior year.

These increases were partially offset by an approximate 4 month suspension of operations at Peñasquito commencing in June 2023 due to a strike by the Union and lower gold and copper sales at Mount Milligan compared to the prior year.

(3) Individually, with the exception of the Wassa stream ( 6.7 % for the year ended December 31, 2024 and 5.4% for the year ended December 31, 2023), Rainy River stream ( 6.4% fo r the year ended December 31, 2024 and 6.4% for the year ended December 31, 2023), Peñasquito royalty (6.4% for the year ended December 31, 2024), Xavantina stream (5.4% for the year ended December 31, 2024), and Khoemac a u stream (5.7% for the year ended December 31, 2023), no stream or royalty included within the “Other” category contributed greater than 5% of our total revenue for either period.

The increase in our total revenue for the year ended December 31, 2024, compared with the year ended December 31, 2023, resulted primarily from higher average gold, silver and copper prices, higher production from Peñasquito, and higher gold sales at Xavantina and Wassa which are included in other stream revenue in the table above.

The increase was partially offset by lower production from the Cortez Legacy Zone, lower gold sales from Andacollo, and lower silver sales from Khoemac a u when compared to the prior year.

Gold and silver ounces and copper pounds purchased and sold during the year ended December 31, 2024 and 2023, as well as gold, silver and copper in inventory as of December 31, 2024 and 2023, for our stream interests were as follows:

December 31, 2023

December 31, 2022

December 31, 2023

December 31, 2022

Purchases (oz.)

Inventory (oz.)

Year Ended December 31, 2024 Year Ended December 31, 2023 As of December 31, 2024 As of December 31, 2023

Gold Stream Purchases (oz.) Sales (oz.) Purchases (oz.) Sales (oz.) Inventory (oz.) Inventory (oz.)

Mount Milligan 58,000 57,500 56,800 58,000 4,500 4,000

December 31, 2023

December 31, 2022

December 31, 2023

December 31, 2022

Silver Stream

Purchases (oz.)

Inventory (oz.)

December 31, 2023

December 31, 2022

December 31, 2023

December 31, 2022

Copper Stream

Purchases (Mlbs.)

Sales (Mlbs.)

Purchases (Mlbs.)

Sales (Mlbs.)

Inventory (Mlbs.)

Pueblo Viejo 26,500 24,900 25,400 27,100 7,700 6,200

Andacollo 19,300 20,000 22,500 25,500 — 800

Other 51,100 52,200 48,600 48,500 3,300 4,200

Total 154,900 154,600 153,300 159,100 15,500 15,200

Year Ended December 31, 2024 Year Ended December 31, 2023 As of December 31, 2024 As of December 31, 2023

Silver Stream Purchases (oz.) Sales (oz.) Purchases (oz.) Sales (oz.) Inventory (oz.) Inventory (oz.)

Pueblo Viejo (1)

859,900 863,400 907,000 1,021,900 219,400 223,000

Other 1,490,700 1,531,900 1,793,900 1,757,100 119,000 160,100

Total 2,350,600 2,395,300 2,700,900 2,779,000 338,400 383,100

Year Ended December 31, 2024 Year Ended December 31, 2023 As of December 31, 2024 As of December 31, 2023

Copper Stream Purchases (Mlbs.) Sales (Mlbs.) Purchases (Mlbs.) Sales (Mlbs.) Inventory (Mlbs.) Inventory (Mlbs.)

Mount Milligan 11.8 11.8 10.9 11.8 — —

Cost of sales decreased to $90.5 million for the year ended December 31, 2023, from $94.6 million for the year ended December 31, 2022.

The decrease was primarily due to lower gold and copper sales at Mount Milligan and lower gold and silver sales at Pueblo Viejo when compared to the prior year.

This decrease was partially offset by higher silver sales at Khoemac a u when compared to the prior year.

Cost of sales, which excludes depreciation, depletion and amortization, is specific to our stream agreements and is the result of our purchase of gold, silver and copper for a cash payment.

The cash payment for gold from Mount Milligan is the lesser of $435 per ounce or the prevailing market price of gold when purchased, while the cash payment for our other streams is a set contractual percentage of the gold, silver or copper (Mount Milligan) spot price near the date of metal delivery.

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(1) Pueblo Viejo silver purchases for the year ended December 31, 2024 do not include 816,500 ounces of silver permitted to be deferred based on the terms of the Pueblo Viejo silver stream agreement.

Total deferred silver ounces were 1.7 million ounces at December 31, 2024, and the timing for the delivery of this deferred amount is uncertain.

Cost of sales, which excludes depreciation, depletion, and amortization, increased to $97.5 million for the year ended December 31, 2024, from $90.5 million for the year ended December 31, 2023.

The increase was primarily due to higher average gold, silver and copper prices and higher gold sales from Xavantina and Wassa, partially offset by lower gold sales from Andacollo and lower silver sales from Khoemac a u when compared to the prior year.

Cost of sales is specific to our stream agreements and, except for Mount Milligan, is the result of our purchase of metal for a cash payment that is a set contractual percentage of the spot price for that metal near the date of metal delivery.

For Mount Milligan, the cash payments under the existing stream agreement are the lesser of $435 per ounce or the prevailing market price of gold when purchased and 15% of the spot price for copper near the date of metal delivery.

Separately, and in addition to the cash payments under the existing stream agreement, the Mount Milligan Cost Support Agreement detailed in Note 7 of our Notes to Consolidated Financial Statements provides for cash payments on gold and copper deliveries that are expected to begin after certain thresholds are met, or earlier, if metal prices are below certain thresholds and if requested by Centerra.

General and administrative costs increased to $40.9 million for the year ended December 31, 2024, from $39.8 million for the year ended December 31, 2023.

The increase was primarily due to higher corporate costs and an increase in non-cash stock compensation expense.

The increase was primarily due to higher non-cash stock compensation expense when compared to the prior year.

Depreciation, depletion and amortization decreased to $144.4 million for the year ended December 31, 2024, from $164.9 million for the year ended December 31, 2023.

The decrease was primarily due to lower depletion rates at Pueblo Viejo as a result of proven and probable mineral reserve increases when compared to the prior year.

The decrease was partially offset by higher depletion expense at Khoemac a u due to the ramp-up of production in 2023 and additional depletion from the newly acquired royalties at Cortez in 2022.

There were no impairment charges on any of our stream or royalty interests for the year ended December 31, 2023.

During the year ended December 31, 2022, we recognized an impairment loss of $4.3 million on the carrying value of a non-principal exploration stage royalty due to new legal information received.

Refer to Note 4 of our notes to consolidated financial statements for further discussion on the impairment.

Interest and other expense increased to $30.9 million for the year ended December 31, 2023, from $17.2 million for the year ended December 31, 2022.

The increase in the current period was primarily attributable to higher interest expense as a result of higher interest rates when compared to the prior period.

The all-in interest rates as of December 31, 2023 and 2022, were 6.56% and 5.93%, respectively.

Refer to Note 5 of our notes to consolidated financial statements for further discussion on our debt.

Income tax expense was $42.0 million for the year ended December 31, 2023, as compared to $32.9 million for the year ended December 31, 2022, which resulted in an effective tax rate of 14.9% in the current period and 12.1% in the prior

The effective tax rates for the years ended December 31, 2023 and 2022, were primarily impacted by the release of valuation allowances on certain foreign deferred tax assets.

The decrease was primarily due to lower stream depletion rates, as a result of proven and probable mineral reserve increases by our operators, lower gold sales from Andacollo, lower silver sales from Khoemac a u and lower gold production from the Cortez Legacy Zone when compared to the prior year.

The decrease was partially offset by higher production from Peñasquito when compared to the prior year.

Interest and other expense decreased to $9.7 million for the year ended December 31, 2024, from $30.9 million for the year ended December 31, 2023.

The decrease was primarily due to lower interest expense as a result of lower average amounts outstanding under our revolving credit facility compa red to the prior year.

For the year ended December 31, 2024, amounts outstanding under our revolving credit facility averaged $82.0 million at an average all-in borrowing rate of 6.5%,

compared to average amounts outstanding of $391.4 million at an average all-in borrowing rate of 6.4% for the year ended December 31, 2023.

Income tax expense was $93.6 million for the year ended December 31, 2024, as compared to $42.0 million for the year ended December 31, 2023, which resulted in an effective tax rate of 22.0% in the current period and 14.9% in the prior year.

The year ended December 31, 2024 included a $13.0 million U.S.

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

The year ended December 31, 2023 included a release of valuation allowances on certain foreign deferred tax assets.

Liquidity and Capital Resources

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This compares to working capital of $95.0 million, including $104.2 million of cash and equivalents at December 31, 2023.

The decrease in our working capital was primarily due to a decrease in our available cash, which resulted from increased debt repayments during the current period.

The increase in our working capital was primarily due to an increase in our available cash, which primarily resulted from higher net cash proceeds from our stream and royalty interests and cash proceeds received for the Mount Milligan Cost Support Agreement, partially offset by the Cactus and Back River royalty acquisitions during the current year.

During the year ended December 31, 2024, liquidity needs were met from $529.5 million in net cash provided by operating activities and our available cash resources.

Working capital, combined with the $750 million of available capacity under our revolving credit facility, resulted in approximately $845 million of total liquidity at December 31, 2023.

Refer to Note 5 of our notes to consolidated financial statements and below (“Recent Liquidity and Capital Resource Developments”) for further discussion on our debt.

At December 31, 2023, our contractual cash obligations are solely comprised of operating leases.

Working capital, combined with available capacity under our revolving credit facility, resulted in approximately $1.2 billion of total liquidity at December 31, 2024.

As of December 31, 2024, we had $1.0 billion available under our revolving credit facility.

We were in compliance with each financial covenant under the revolving credit facility as of December 31, 2024.

Refer to Note 5 of our Notes to Consolidated Financial Statements and below under Recent Liquidity and Capital Resource Developments for further discussion on our debt.

At December 31, 2024, our contractual cash obligations were solely comprised of operating leases.

We believe we will be able to fund all current cash obligations from net cash provided by operating activities.

For additional information on our operating leases, see Note 6 of our Notes to Consolidated Financial Statements.

Please refer to our risk factors included in Part I, Item 1A of this report for a discussion of certain risks that may impact our liquidity and capital resources.

Please refer to our risk factors included in Item 1A of this report for a discussion of certain risks that may impact our liquidity and capital resources.

Recent Liquidity and Capital Resource Developments

Revolving Credit Facility Repayment

On December 6, 2023, we made a $75 million principal payment towards the outstanding balance on the revolving credit facility leaving $750 million available as of December 31, 2023.

During the year ended December 31, 2024, we repaid the remaining $250 million of outstanding borrowings on our revolving credit facility, making the entire $1 billion revolving credit facility available as of December 31, 2024.

Dividend Increase

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Net cash provided by operating activities totaled $529.5 million for the year ended December 31, 2024, compared to $415.8 million for the year ended December 31, 2023.

The decrease was primarily due to higher interest paid on the outstanding revolving credit facility compared to the prior period.

This decrease was partially offset by higher proceeds received from our stream and royalty interests, net of cost of sales, compared to the prior period.

The increase, when compared to the prior year, was primarily due to higher net cash proceeds received from our stream and royalty interests of $80.3 million, cash proceeds of $24.5 million received from the Mount Milligan Cost Support Agreement, lower debt cash interest payments of $21.5 million and $12.0 million of interest from the repayment of the Khoemac a u subordinated debt facility.

This increase was partially offset by higher cash taxes of $21.8 million when compared to the prior year.

Investing Activities

Net cash used in investing activities totaled $77.7 million for the year ended December 31, 2024, compared to net cash used in investing activities of $2.8 million for the year ended December 31, 2023.

The decrease over the prior period was primarily due to the new royalty acquisitions during the year ended December 31, 2022.

The increase was primarily due to the acquisition of the Back River and Cactus royalties offset by the $25 million principal repayment received on the Khoemac a u subordinated debt facility when compared to the prior year.

Financing Activities

Net cash used in financing activities totaled $427.4 million for the year ended December 31, 2023, compared to net cash provided by financing activities of $480.6 million for the year ended December 31, 2022.

The change was primarily due to an increase in the debt outstanding for the year ended December 31, 2022 of $575 million that was used to fund acquisitions of our new royalty interests at Cortez and the Great Bear Project, and the repayment of $325 million of debt outstanding during the current period.

Net cash used in financing activities totaled $360.5 million for the year ended December 31, 2024, compared to net cash used in financing activities of $427.4 million for the year ended December 31, 2023.

The decrease, when compared to the prior year, was primarily due to lower debt repayments.

Critical Accounting Estimates

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We evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts of an asset or group of assets may not be recoverable.

The recoverability of the carrying value of stream and royalty interests in production and development stage mineral properties is evaluated based upon estimated future undiscounted net cash flows from each stream and royalty interest using estimates of proven and probable mineral reserves, mineral resources and other relevant information received from the operators.

We evaluate the recoverability of the carrying value of royalty interests in exploration stage mineral properties in the event of significant decreases in the price of gold, silver, copper and other metals, and whenever new information regarding the mineral properties is obtained from the operator indicating that production will not likely occur or may be reduced in the future, thus potentially affecting the

future recoverability of our stream or royalty interests.

The recoverability of the carrying value of stream

and royalty interests in production and development stage mineral properties is evaluated based upon estimated future undiscounted net cash flows from each stream and royalty interest using estimates of proven and probable mineral reserves, mineral resources and other relevant information received from the operators.

Impairments in the carrying value of each property are measured and recorded to the extent that the carrying value in each property exceeds its estimated fair value, which is generally calculated using estimated future discounted cash flows.

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It is possible that changes could occur to these estimates, which could adversely affect the net cash flows expected to be generated from these stream and royalty interests.

Refer to Note 4 of our notes to consolidated financial statements for a discussion of the impairment assessment results for the years ended December 31, 2023 and 2022.

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.

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Gold, silver and copper received under our metal stream 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 stream agreement and our sales policy in effect at the time) commencing shortly after receipt and purchase of the metal.

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 (typically depending on the frequency of deliveries under the respective stream 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.

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

In all of our most significant 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.

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Forward-looking statements are often identified by words like “will,” “may,” “could,” “should,” “would,” “believe,” “estimate,” “expect,” “anticipate,” “plan,” “forecast,” “potential,” “intend,” “continue,” “project,” or negatives of these words or similar expressions.

Forward-looking statements include, among others, the following:

statements about our expected financial performance and outlook, including sale volume, revenue, expenses, tax rates, earnings or cash flow;

operators’ expected operating and financial performance, including production, deliveries, mine plans, environmental and feasibility studies, technical reports, estimates of mineral resources and mineral reserves, development, cash flows and liquidity, capital requirements and capital expenditures;

influence on our operators’ operations;

benefits from acquisitions;

receipt and timing of metal deliveries;

liquidity, capital resources, financing and stockholder returns;

Forward-looking statements include, among others, statements regarding the following:

our expected financial performance and outlook, including sales volume, revenue, expenses, tax rates, earnings, and cash flows;

operators’ expected operating and financial performance and other anticipated developments relating to their properties and operations, including production, deliveries, estimates of mineral resources and mineral reserves, environmental and feasibility studies, technical reports, mine plans, capital requirements, liquidity, and capital expenditures;

opportunities for investments, acquisitions and other transactions;

anticipated benefits from investments, acquisitions and other transactions;

receipt and timing of future metal deliveries, including deferred amounts at Pueblo Viejo;

the timing and amount of future benefits and obligations in connection with the Mount Milligan Cost Support Agreement;

anticipated liquidity, capital resources, financing, and stockholder returns;

borrowings and repayments under our revolving credit facility;

growing our portfolio of assets;

the materiality of properties within our portfolio;

impact of inadequately assessing new acquisitions;

macroeconomic and market conditions;

impacts of climate change;

diversity and inclusion efforts;

the anticipated effects of climate change;

returns on investments;

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valuation allowances;

assumptions related to fair value of equity awards;

prices for gold, silver, copper, nickel and other metals;

potential impairments;

and tax changes.

assumptions related to fair value of equity awards;

and prices for gold, silver, copper, and other metals.

Factors that could cause actual results to differ materially from these forward-looking statements include, among others, the following:

a lower-price environment for gold, silver, copper or other metals;

needs, mining and environmental hazards, labor disputes, distribution and supply chain disruptions, permitting and licensing issues, or operational disruptions;

contractual issues involving our stream or royalty agreements;

changes in the price of gold, silver, copper, or other metals;

operating activities or financial performance of properties on which we hold stream or royalty interests, including variations between actual and forecasted performance, operators’ ability to complete projects on schedule and as planned, operators’ changes to mine plans and mineral reserves and mineral resources (including updated mineral reserve and mineral resource information), liquidity needs, mining and environmental hazards, labor disputes, distribution and supply chain disruptions, permitting and licensing issues, other adverse government or court actions, or operational disruptions;

changes of control of properties or operators;

issues involving our stream or royalty agreements;

the timing of deliveries of metals from operators and our subsequent sales of metal;

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potential cyber-attacks, including ransomware;

our ability to identify, finance, value and complete acquisitions;

our ability to identify, finance, value, and complete investments, acquisitions or other transactions;

adverse economic and market conditions;

impact of health epidemics and pandemics;

effects of health epidemics and pandemics;

changes in laws or regulations governing us, operators, or operating properties;

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Forward-looking statements speak only as of the date on which they are made.

We disclaim any obligation to update any

forward-looking statements, except as required by law.

We disclaim any obligation to update any forward-looking statements, except as required by law.

Readers are cautioned not to put undue reliance on forward-looking statements.

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-K

Item 7. Management’s Discussion and Analysis