SECOND QUARTER HIGHLIGHTS
- Record attributable gold equivalent ounces1 of 18,004 ounces (Q2 2020 — 10,920 ounces);
- Revenue of
$26.4 million (Q2 2020 —$18.7 million ); - Record total sales, royalties, and income from other interests1 of
$32.3 million (Q2 2020 —$18.7 million ); - Cash flows from operating activities, excluding changes in non-cash working capital1 of
$17.6 million (Q2 2020 —$13.4 million ); - Average cash cost per attributable gold equivalent ounce1 of
$227 resulting in cash operating margins1 of$1,569 per ounce (Q2 2020 —$257 per ounce and$1,458 per ounce respectively); - Net income of
$8.6 million (Q2 2020 —$7.1 million); - Significant Acquisitions: During the quarter, the Company entered into over
$140 million in stream and royalty transactions. The acquisitions provide the Company with immediate cash flow, exposure to quality assets, increased diversification, and exploration upside. - In
June 2021 , the Company acquired a diverse package of Vale royalties which provide holders with life of mine net sales royalties on certain of Vale's producing and exploration assets. The royalties provide exposure to several of Vale's long-life, low-cost assets and are expected to contribute to Sandstorm's portfolio for several decades. - In
June 2021 , the Company agreed to acquire a gold stream on the operating Vatukoula gold mine inFiji in exchange for a$30 million upfront deposit. The stream entitles Sandstorm to purchase 25,920 ounces of gold over a six-year period and thereafter 2.55%–2.9% of the gold produced from the mine for on-going per ounce cash payment equal to 20% of the spot price of the gold. In addition to the Gold Stream, Sandstorm will also receive an effective 0.45% NSR on certain prospecting licenses. The transaction is anticipated to close in the third quarter of 2021. Upon closing, the disbursement of theUS$30 million will commence alongside the completion of various construction and expansion milestones. - In
May 2021 , the Company acquired a package of royalties for consideration of$7 million . The package includes 21 royalties on development, advanced exploration and exploration stage projects located inNevada andMontana .
OUTLOOK AND HOD MADEN UPDATE
Based on the Company's existing royalties, attributable gold equivalent ounces for 2021 is forecast to be between 62,000 and 69,000 ounces.
The Hod Maden Feasibility Study is in the final stages and the Company expects it to be completed, along with receiving the Environmental Impact Assessment ("EIA"), by the end of
Sandstorm has updated its long-term guidance and is forecasting attributable gold equivalent production to be over 125,000 ounces in 2025.
FINANCIAL RESULTS
Sandstorm's revenue during the second quarter of 2021 was
Net income was higher when compared to the same period in 2020 primarily due to the increase in revenue as well as a gain of
STREAMS & ROYALTIES
Of the gold equivalent ounces sold by Sandstorm during the second quarter of 2021, approximately 13% were attributable to mines located in
THREE MONTHS ENDED | |
Gold Equivalent Ounces | |
2,370 | |
3,302 | |
11,053 | |
Other | 1,279 |
Total | 18,004 |
Streams and royalties on Canadian mines contributed 94% more gold equivalent ounces to Sandstorm when compared to the second quarter of 2020. The change is primarily due to an increase in royalty revenue from the Diavik mine in the
North America Excluding Canada
The gold equivalent ounces sold from operations located within
Operations in
Other
Streams and royalties on mines in other countries contributed 57% less gold equivalent ounces sold when compared to the second quarter of 2020. The change is primarily due to a decrease in gold equivalent ounces sold from the Karma mine in
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: 399048
Webcast URL: https://bit.ly/3yWzMmS
Note 1
Sandstorm has included certain performance measures in this press release that do not have any standardized meaning prescribed by International Financial Reporting Standards ("IFRS") including (i) average cash cost per attributable gold equivalent ounce, (ii) total sales, royalties and income from other interests, (iii) average realized gold price per attributable gold equivalent ounce, (iv) cash operating margin, and (v) cash flows from operating activities excluding changes in non-cash working capital. 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 in comparison to other streaming and royalty companies in the precious metals mining industry who present results on a similar basis. Total sales, royalties and income from other interests 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. Refer to page 30 of the MD&A for a numerical reconciliation of the total sales, royalties, and income from other interests. 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 in comparison to other streaming and royalty companies in the precious metals mining industry. Average realized gold price per attributable gold equivalent ounce is calculated by dividing the Company's total sales, royalties, and income from other interests by the number of attributable gold equivalent ounces. The Company presents average realized gold price per 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. Cash operating margin is calculated by subtracting the average cash cost per attributable gold equivalent ounce from the average realized gold price per attributable gold equivalent ounce. The Company presents cash operating margin as it believes that certain investors use this information to evaluate the Company's performance in comparison to other companies in the precious metals mining industry who present results on a similar basis. The Company has also used the non-IFRS measure of cash flows from operating activities excluding changes in non-cash working capital. This measure 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. Sandstorm has included attributable gold equivalent ounces as a performance measure in this press release which does not have any standardized meaning prescribed by IFRS. The Company's royalty and other commodity stream revenue, including adjustments for contractual income relating to those interests, is converted to an attributable gold equivalent ounce basis by dividing the royalty and other commodity revenue, including adjustments for contractual income relating to those interests, for that period by the average realized gold price per ounce from the Company's gold streams for the same respective period. These attributable gold equivalent ounces, when combined with the gold ounces sold from the Company's gold streams, equal total attributable gold equivalent ounces and may be subject to change. The presentation of this non-IFRS measure is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these non-IFRS measures differently.
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 gold royalty company that provides upfront financing to gold mining companies that are looking for capital and in return, receives the right to a percentage of the gold produced from a mine, for the life of the mine. Sandstorm has acquired a portfolio of 229 royalties, of which 28 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
The disclosure and information contained or referenced herein uses mineral reserve and mineral resource classification terms that comply with reporting standards in
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 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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