Gold Royalty Corp.

Good morning. I'm your host, Joanne Jobin, and welcome to another Gold Royalty Town Hall Forum hosted by VidMedia. Before we start, I'd like to introduce CEO David Garofalo, John Griffiths, Chief Development Officer, and Andrew Goebbels, CFO, who will provide an update on recent financial and operating results for the company. After their presentation, I'll be delighted to moderate submitted questions from our audience. Now, a few words on the company. Gold Royalty Corp. is a precious metals focused royalty and streaming company offering creative financing solutions to the metals and mining industry. It currently has a diversified portfolio of over 190 royalties located in mining friendly jurisdictions throughout the Americas. The company's business model includes acquiring royalties, streams, and similar interests at varying stages of the mine lifecycle to build a balanced portfolio offering near, medium, and longer-term attractive returns for investors. Now, before we get started, I would like to remind you that if you do have any questions for the company, please place them into the Q&A tab at the top of your chat sections. And please ensure that you fill in the short questionnaire at the end of the presentation, as this helps us and the company communicate more effectively with you for future events. And before I turn it over to the team, please note the forward-looking statement at the beginning of this presentation. Gentlemen, the stage is yours.

Thank you, Joanne. Good morning, everybody, and welcome to John and Andrew as well, who will be presenting along with me in Andrew will be providing a highlight on the financial results for the quarter and our forward-looking projections. And John will walk us through our portfolio, a very extensive portfolio. Actually, now 216 royalties across the portfolio, heavily concentrated in the Americas, with even significant concentration in Nevada, Quebec, and Ontario, the three best countries. mining jurisdictions in the world and some of the best producing gold assets in the world. And we'll get into that in a bit more detail as we go through the presentation. But I thought I'd spend a minute talking about the rally in the gold price of late. And as we've said in the past, when we've talked about the fundamentals for gold, we've always said it's more a monetary instrument than a commodity. And really what drives gold price up and down is relative interest rates. Why? Gold as a monetary instrument has always yielded zero. Treasuries today, whether it's U.S. treasuries or whether we're looking at the European monetary instruments or in the Western world generally, are really yielding negative on a real basis, even as nominal rates are starting to go up. We're seeing inflation accelerate and inflation will continue to accelerate because central banks are dealing with a quandary in that we're seeing the monetary system, particularly financial services systems, start to collapse underneath because of all the accesses that have been introduced into the system since the credit crisis of about 15 years ago. There's been a massive expansion of money supply. and excess debt. And as interest rates go up, servicing that debt has become a significant challenge. And we've seen the evidence of that in the financial sector as we've seen banks collapse. And that's just really the beginning, the tip of the iceberg. That's the catalyst for gold. And it has been the catalyst for gold over the last... couple of months as we've seen a significant acceleration in the price as the market has started to realize that the central banks really can tighten monetary conditions significantly with undermining the financial system, undermining governments, because as we correctly pointed out, the debt levels that we've strapped on as a society since the onset of this inflation cycle and since the great financial crisis is significantly greater than it was back in the 1970s when we last experienced these types of inflation. Debt to GDP globally is at about 350%, relative to where it was in the 1970s at 100%. So what that tells you is there's very limited latitude for central banks to meaningfully tighten monetary conditions without undermining governments, corporations, and individuals, all of whom are carrying unprecedented debt levels. So while we're seeing the central banks continue to increase interest rates, and for example, the Federal Reserve has recently tightened interest rates another 25 basis points, that same Federal Reserve introduced $300 billion of new liquidity into the system to stave off bank collapses. And there's more of that to come. So they are sucking and blowing. We're starting to see central banks introduce new money supply into the system, even as they're increasing nominal interest rates. What that will serve to do is accelerate inflation. And we're going to see inflation levels unlike we haven't seen since the 1970s. And that will drive real interest rates deeper and deeper into negative territory. And the negative correlation, the negative relationship between the gold price and real interest rates is striking and dramatic. And that's why we've been consistent in saying that gold will achieve its new all-time highs of at least $3,000 an ounce. And that's on a real basis because gold back in the early 1980s in the last big inflation cycle was in excess of $800 an ounce. But if you inflation adjust that to $20, $23, that suggests us that gold could go to at least $3,000 an ounce. And that would be the real all time high. So we still have at least 50 percent upside from the current gold price levels that we're experiencing. And that will drive new capital into the gold sector. And we think significant share price appreciation. And we're starting to see the early evidence of that. Since the crisis in banking system, really, which started to manifest itself in early March, we've seen a significant outperformance in both the GDXJ and gold prices relative to the general equity markets. And that's what gold should do in these times of crises, is provide insurance against volatility in the general equity markets. So we've seen the gold price go up dramatically. There's more of that to come, and there's more volatility to come in the general equity markets as people's confidence in the economy is undermined, and as money supply continues to accelerate, inflation continues to accelerate, people will be looking for gold as a life preserver, as a protector and preserver of their savings, because inflation is insidious. It eats at our savings, whereas gold preserves savings in the face of an inflationary environment. And with that macro discussion, I'd like to pass it on to Andrew to talk about our financial results. Oh, sorry, and I should end my discussion talking about the opportunity I see in the valuations before I hand it off to Andrew to talk about our financial results. You can see that The sector is still significantly discounted. There's still been a relative significant underperformance of the gold equities relative to the gold price. And the opportunity we see with gold royalty trading at the half times NEV with an enviable portfolio of assets within the Americas and peer leading growth is a significant re-rate as we crystallize that revenue growth over the coming years. And the thing I should add, we own 216 royalties, but they're completely bought and paid for. There's no capital calls on them. So essentially, we just have to wait for that growth to come to fruition. And the value accretion on a per share basis is immense over the coming years. And the re-rate potential of our stock as we achieve that skill organically through the growth of our cash flow from an existing well-diversified portfolio within the best mining jurisdictions of the world, we think is immense and a great opportunity for our shareholders to realize upside. With that, I will pass it on to Andrew to talk about our financial results.

Thanks, Dave. You would have seen yesterday we announced our financial results for the quarter ended December 31st, 2022. With the change in our fiscal year end from September 30th to December 31st, this period will become the fourth quarter of what will be our 2022 fiscal year. In the December quarter, we continue to generate robust revenue from our portfolio, earning $1.1 million of total revenue and option proceeds for that three-month period. Now, that's an 11% increase from the same period in 2021. This is largely due to higher revenue contribution from some core royalties, such as Canadian Malartic and Borden. For fiscal 2023, we do expect total revenue and option proceeds to increase year on year. And we've put forward guidance of 5.5 to $6.5 million in total revenue and option proceeds for the year. We end the calendar year with a strong financial position as well. We have cash and available liquidity of approximately $35 million. And we're well positioned to fund our business and continue to grow the company throughout the year with this liquidity position. Finally, in fiscal 2023, we also expect recurring cash operating costs to be between $7 million and $8 million for the year. Now, this would represent a 30% decrease in recurring operating costs from the prior calendar year and reflects the evolution of our company after a fast start following the IPO and three large strategic acquisitions in our initial growth phase.