Osisko Gold Royalties : Consolidated Financial Statements – Q2 2022

OSISKO GOLD ROYALTIES LTD

. . . . . . . . . . . . . . . . . .

Unaudited Condensed Interim

Consolidated Financial Statements

For the three and six months

ended

June 30, 2022

Osisko Gold Royalties Ltd

Consolidated Balance Sheets (Unaudited)

(tabular amounts expressed in thousands of Canadian dollars)

		June 30,		December 31,
		2022		2021
	Notes	$	$
Assets
Current assets
Cash	5	449,283	115,698
Amounts receivable		27,736	14,691
Inventories	6	26,361	18,596
Other assets		6,698		3,941
		510,078	152,926
Non-current assets
Investments in associates	7	126,523	125,354
Other investments	8	113,302	169,010
Royalty, stream and other interests	9	1,148,482	1,154,801
Mining interests and plant and equipment	4, 10	836,706	635,655
Exploration and evaluation		42,758	3,635
Goodwill		111,204	111,204
Other assets		34,381		18,037
		2,923,434	2,370,622
Liabilities
Current liabilities
Accounts payable and accrued liabilities		33,341	30,049
Dividends payable		10,177	9,157
Provisions and other liabilities	11	12,663	12,179
Current portion of long-term debt	12	300,600		294,891
		356,781	346,276
Non-current liabilities
Provisions and other liabilities	11	89,855	60,334
Long-term debt	12	4,636	115,544
Deferred income taxes		96,417		68,407
		547,689	590,561
Equity
Share capital		2,085,642	1,783,689
Warrants		-	18,072
Contributed surplus		59,383	42,525
Equity component of convertible debentures		14,510	14,510
Accumulated other comprehensive income		28,010	58,851
Deficit		(305,499)		(283,042)
Equity attributable to Osisko Gold Royalties Ltd's shareholders		1,882,046	1,634,605
Non-controlling interests		493,699		145,456
Total equity		2,375,745		1,780,061
		2,923,434		2,370,622

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

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Osisko Gold Royalties Ltd

Consolidated Statements of Income (Loss)

For the three and six months ended June 30, 2022 and 2021 (Unaudited)

(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)

Revenues

Cost of sales

Depletion and amortization

Gross profit

Other operating expenses

General and administrative Business development Exploration and evaluation Mining operating expenses Impairments - royalty, stream and other

interests

Impairments - mining exploration, evaluation and development

Operating (loss) income

Interest income Finance costs

Foreign exchange gain (loss)

Share of (loss) income of associates Other gains (losses), net

Earnings (loss) before income taxes

Income tax expense

Net earnings (loss)

Net earnings (loss) attributable to:

Osisko Gold Royalties Ltd's shareholders Non-controlling interests

Net earnings (loss) per share

Basic and diluted

	Three months ended		Six months ended
			June 30,				June 30,
	2022		2021		2022		2021
Notes	$	$	$	$
			(Note 3)				(Note 3)
15	63,959	57,941	123,357	124,864
15	(15,318)	(10,791)	(26,480)	(31,188)
	(12,050)		(11,437)		(24,076)		(23,364)
	36,591	35,713	72,801	70,312
	(14,875)	(9,171)	(27,519)	(19,077)
	(1,260)	(1,118)	(2,681)	(2,105)
	(144)	(843)	(264)	(1,180)
	(20,602)	-	(35,848)	-
	-	-	-	(2,288)
	-	(40,479)	-	(40,479)
	(290)	(15,898)	6,489	5,183
	2,292	1,348	3,483	2,658
	(7,310)	(5,884)	(13,683)	(12,027)
	9,405	(406)	10,592	(1,535)
	(1,219)	(1,861)	1,054	(1,893)
15	23,884	1,629	18,660	(281)
	26,762	(21,072)	26,595	(7,895)
	(10,190)		(3,991)		(15,552)		(7,405)
	16,572		(25,063)		11,043		(15,300)
	17,159	(14,759)	17,485	(4,165)
	(587)	(10,304)	(6,442)	(11,135)
16
	0.09	(0.09)	0.10	(0.02)

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

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Osisko Gold Royalties Ltd

Consolidated Statements of Comprehensive Income (Loss) For the three and six months ended June 30, 2022 and 2021 (Unaudited)

(tabular amounts expressed in thousands of Canadian dollars)

		Three months ended		Six months ended
				June 30,				June 30,
		2022		2021		2022		2021
		$	$	$	$
Net earnings (loss)	16,572	(25,063)	11,043	(15,300)
Other comprehensive income (loss)
Items that will not be reclassified to the
consolidated statement of income (loss)
Changes in fair value of financial assets at
fair value through comprehensive income	(15,508)	(1,384)	(31,277)	(900)
Income tax effect	1,460	138	3,523	2,843
Items that may be reclassified to the
consolidated statement of income (loss)
Cumulative translation adjustments	17,992	(7,294)	11,186	(14,345)
Deemed disposal of an investment in an associate
Reclassification to the statements of income
(loss) of the other comprehensive income, net of
income tax	(294)		-		(294)		-
Other comprehensive income (loss)	3,650		(8,540)		(16,862)		(12,402)
Comprehensive income (loss)		20,222		(33,603)		(5,819)		(27,702)
Comprehensive income (loss) attributable to:
Osisko Gold Royalties Ltd's shareholders	21,404	(22,677)	1,307	(15,982)
Non-controlling interests	(1,182)	(10,926)	(7,126)	(11,720)

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

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Osisko Gold Royalties Ltd

Consolidated Statements of Cash Flows

For the three and six months ended June 30, 2022 and 2021 (Unaudited)

(tabular amounts expressed in thousands of Canadian dollars)
		Three months ended		Six months ended
				June 30,				June 30,
	Notes	2022		2021		2022		2021
		$	$	$	$
Operating activities
Net earnings (loss)		16,572	(25,063)	11,043	(15,300)
Adjustments for:
Share-based compensation		2,525	2,090	6,156	5,390
Depletion and amortization		15,983	11,794	31,000	24,055
Impairment of assets		384	40,479	904	44,879
Finance costs		2,570	1,716	4,715	3,555
Share of loss of associates		1,219	1,861	(1,054)	1,893
Net gain on acquisition of investments		-	(211)	(48)	(649)
Change in fair value of financial assets and
liabilities at fair value through profit and loss		(12,106)	1,777	(3,930)	3,685
Net gain on dilution of investments		(1,544)	-	(3,604)	(1,391)
Gain in deemed disposal of associate		(11,854)	-	(11,854)	-
Foreign exchange (gain) loss		(9,156)	622	(10,556)	1,395
Flow-through shares premium income		(573)	(2,798)	(914)	(3,268)
Deferred income tax expense		9,735	3,483	14,863	6,833
Other		2,202	(432)	1,859	493
Net cash flows provided by operating activities
before changes in non-cash working capital items		15,957	35,318	38,580	71,570
Changes in non-cash working capital items	17	(16,181)		(4,401)		(15,194)		(19,329)
Net cash flows (used in) provided by operating activities	(224)	30,917	23,386	52,241
Investing activities
Acquisition of Tintic, net of cash acquired	4	(62,189)	-	(62,189)	-
Acquisition of investments		(384)	(4,026)	(11,118)	(13,837)
Proceeds on disposal of investments		3,186	8,338	24,241	28,109
Acquisition of royalty and stream interests		-	(39,085)	(9,290)	(42,877)
Mining assets and plant and equipment		(20,973)	(53,839)	(34,007)	(89,651)
Exploration and evaluation expenses, net		(681)	(1,028)	(686)	(1,163)
Reclamation deposits, net		(13,371)	-	(13,371)	-
Other		(774)		(201)		(1,038)		(201)
Net cash flows used in investing activities		(95,186)	(89,841)	(107,458)	(119,620)
Financing activities
Bought deal equity financing		-	-	311,962	-
Share issue costs		(1,125)	-	(13,941)	-
Increase in long-term debt		3,666	-	7,536	50,000
Repayment of long-term debt		(115,095)	-	(115,700)	(50,000)
Investments from minority shareholders		213,153	-	255,543	38,841
Share issue expenses from investments from
minority shareholders		(5,108)	-	(7,238)	(2,581)
Exercise of share options and shares issued
under the share purchase plan		312	8,129	934	13,107
Normal course issuer bid purchase of common shares	-	-	(4,879)	(4,464)
Dividends paid		(9,755)	(7,914)	(18,478)	(15,696)
Capital payments on lease liabilities		(1,060)	(1,928)	(6,332)	(2,780)
Withholding taxes on settlement of restricted and
deferred share units		(1,800)	(3,544)	(2,224)	(3,582)
Other		1,332		(3)		2		(3)
Net cash flows provided by (used in) financing activities	84,520	(5,260)	407,185	22,842
(Decrease) increase in cash before effects of
exchange rate changes on cash		(10,890)		(64,184)		323,113		(44,537)
Effects of exchange rate changes on cash		10,723		(1,483)		10,472		(3,024)
(Decrease) increase in cash		(167)	(65,667)	333,585	(47,561)
Cash - beginning of period		449,450		320,630		115,698		302,524
Cash - end of period		449,283		254,963		449,283		254,963

Additional information on the consolidated statements of cash flows is presented in Note 17.

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

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