Gold Royalty Corp.

good morning i'm joanne jobin your vid media host welcome to the gold royalty quarterly investor town hall forum before we commence just a reminder that if you have any questions for the company please place them into the q a tab located at the top of this screen after the presentation i will be delighted to moderate submitted questions from our audience with us this morning is the gold royalty team led by Chairman and CEO David Garofalo, who will make the intros to the team and take you through the highlights of the most recent quarterly results. David, the stage is yours.

Well, good morning, everybody. Thanks for the introduction, Joanne. I'm joined today by our Chief Financial Officer, Andrew Goebbels, who will take us through our second quarter financial results. And then Peter Benke, our Director of Investor Relations and Corporate Development, will provide you a portfolio update. But before we get into that, I thought, as has been my custom, to discuss the fundamentals of the gold market, which means very, very robust. And this is not a recent phenomenon. The significant performance of the gold price has been occurring for 50 years, really since the U.S. government and central banks globally decoupled from the gold standard in early 1970s. It really has been a one-way trade. The temptation to continue to print money is just too great for governments, particularly in this environment where debt levels are at historical highs, 350% global debt to GDP relative to 100% in the last big inflation cycle. And those fundamentals are really driving the governments and central banks in particular to lower interest rates And that's driving capital into gold, which is the one monetary instrument that can't be printed. And while it yields 0%, the reality is treasuries and other sovereign debt is yielding negative on a real basis. So there really is no opportunity cost to owning gold. And this long-term phenomenon of gold appreciating against all fiat currencies will continue unabated into the foreseeable future, particularly as an environment where The only way for these governments to deal with their exorbitant debt levels is to inflate it away. So we are in for a prolonged inflationary cycle and gold will perform extremely well in that environment. What has not performed well, unfortunately, to this point is gold equities. We haven't seen a significant allocation of capital out of the general equity markets into the gold equities. And that's evidenced by the blue line you see here, which is the GDXJ, which still remains 75% below its all-time highs back about 10 years ago when the gold price was $1,000 per ounce lower. And that's not a phenomenon that's unique to the junior stocks. If you look at the bellwether stocks in our industry, for example, Barrick and Newmont, their price levels today are actually about half of what they were in the mid-1990s when gold was only $250 an ounce. So we have not seen a significant rotation of capital into the gold equities yet. But we think that's inevitable. That will happen. And if you look at crises in the past and how the gold commodity and the gold equities have performed in each of those financial crises, eventually there is a significant rotation of capital into the gold equities. Take, for example, the tech crash back in 2000. Initially, it was a baby in the bathwater type of market. Even the gold equities were sold off dramatically. The gold commodity was initially But as the governments started to ease monetary policy, lower interest rates, expand money supply, we started to see gold perform dramatically. And the gold equities in particular provided leverage to the gold price. And so we saw, for example, in the great tech crisis or the tech crash in 2000, that the gold equities outperformed the S&P 500 by over 200 percent. And if you look at the great financial crisis in 2008, again, there was a baby in the bathwater type of market initially where both the commodity and the gold equities were sold off with the general equity market. But eventually, again, as the governments and the central banks in particular started to ease money and lower interest rates, we saw an allocation of capital not only to the commodity, but also to the gold equities was significantly outperformed the S&P 500. We saw a similar phenomenon in the pandemic. Initially, as you saw early on the pandemic, there was a massive sell-off of equities. We started to see capital allocated to the commodity and to the gold equities. Again, a significant outperformance of gold equities to the general equity market. This general equity market has been very narrowly focused on the big seven technology companies. We're starting to see the market chip away at those valuations. We'll start to see a rotation of capital not only the commodity but the gold equities and the gold equities are actually should be performing because they're performing as businesses they're starting to demonstrate clear leverage to the gold price uh year to date even though the gold price is up 20 the gold equities both the large cap the small cap indices are underperforming the commodity that makes no sense given the massive leverage and profitability that these companies are providing to an increased gold price and we've seen that in our own results as we've started to see some of our growth projects come into production. We've seen a significant increase in our revenues this quarter. In fact, we saw a quadrupling in our revenue versus last year, driven by the gold price, but also by the fact that we've seen a number of our projects come into production and starting to deliver positive free cash flow for the first time in our history. So we are poised to provide significant performance. And I think the general equity markets will start, gold equity markets will start to provide significant performance performance, not only the S&P 500, but leverage to the gold price. We think that eventually that rotation will lead to outsized returns relative to the commodity price, given the leverage of profitability that these companies enjoy. What we've been able to do in three and a half years, I think, is remarkable in steadily building out our business, starting with 18 non-cash flowing royalties in our IPO and steadily adding to the portfolio in terms of projects at the production stage, but also development stage projects. We now have seven cash flowing royalties, 14 royalties in various stages of construction, but over 240 royalties overall to provide significant growth, a pipeline across the life cycle of a mine, but also provide our shareholders a significant optionality in a market that we think eventually will pay for that optionality as we start to see a rotation of capital out of the general equity markets into the gold equities. We're poised to significantly outperform not only because of that optionality, but because of our outsized growth in revenue, free cash flow in the coming quarters and years as a result of our robust pipeline of projects where we've seen a 14-fold increase in the number of royalties in our portfolio since our IPO and a 5-fold increase in our net asset value on a gross basis since our IPO. And I understand the net asset value can be an esoteric metric, hard to understand. But what we think everybody can understand is the growth in our revenue. As I said, in Q2, we saw a fourfold increase in our revenue relative to where we were a year ago. And the second consecutive quarter, a positive operating cash flow. And we're poised with a very strong second half with a number of our major projects coming into full production to deliver, again, significant growth in what is now a positive operating cash flow. opportunity for our shareholders. On a consensus basis, we're trading at about 0.5 times net asset value. Again, it's not our own measure. It's looking at the six analysts that cover us relative to our peers. We're significantly undervalued. And I think that's been because at this point or up to this point, the market hasn't been paying for growth. They see risk-inheriting growth But many of our projects now are coming into production or achieving full scale production. And that revenue growth is happening today. Our free cash flow growth is happening today. It was a far off prospect when we started this company several years ago, talking about our growth. But again, that growth is being crystallized in the current quarters, in the coming quarters, and delivering positive free cash flow for our shareholders. And we think positive earnings as well as we go forward. So we're in an excellent position that could deliver a rebate opportunity in our share price. But also, if you look at our shareholder register, we've been able to attract some of the most sophisticated investors in the sector that understand the intrinsic value of our business, understand the value on a per share basis located in terms of net asset value and the coming growth in cash flow and earnings per share as a result of the robust pipeline of projects in the production, and development stage and the significant optionality we have in our portfolio. And with that, I'd like to pass it on to Andrew to talk about our financial results.

Thanks, Dave. As Dave referenced, Q2 was another strong quarter for the company. Gold Royalty, as you've seen in our results, has truly transitioned to become a royalty company that consistently generates cash from operations. In Q2, we delivered $1.2 million worth of cash flow, including land agreement proceeds, credit against multiple mineral properties, which is our second consecutive quarter of positive operating cash flow. It's a great achievement for a company that IPO'd three years ago with 18 non-cash flow royalties, as Dave already mentioned. Q2 total revenue of $2.2 million, that's 947 geos per hour calculation, was approximately 300% higher than the comparable period in 2023. This further highlights how far we've come in such a short period of time. Higher revenue in the period was largely due to the additional royalty receipts from our accretive acquisitions and supplemented by initial cash flows from development projects in our pipeline starting into production. The second quarter also saw continued cost discipline with our cash operating costs down approximately 9% compared to the same period in 2023. Notably, in the period, Gold Royalty completed the acquisition of a copper stream on the Varus project in Bosnia from Orion Mine Finance for $50 million. This bilateral transaction secured a high return long life asset to further strengthen our foundation of producing assets. Aside from Barris, the existing portfolio has continued to perform well. Peter will talk more about this in the subsequent pages. We've earned our first royalty revenue at IAM Golds. Cote project and benefited from a full quarter of cash flow from the Borborema and Cozumel royalties that we acquired last year. That complements strong revenue generation from Canada, Malartic and Borden. Finally, in Q2, Gold Royalty published its second annual sustainability report. which highlights our ESG performance and ongoing commitments. I'm proud to report that we had one of the lowest carbon intensive portfolios in the royalty and streaming sector in 2023. With 6.4 million of total revenue in the first six months of 2024, that's inclusive of land agreement proceeds and interest, we've already exceeded our full year 2023 total revenue of 5.2 million. And we're approximately halfway to achieving our 2024 guidance of 13 to 14 million of total revenue. To help achieve our full year objective, we do expect the second half of 2024 to benefit from further revenue from the Cote mine as it ramps up, and also initial revenue from the Varus mine through the copper stream, which will meaningfully ramp up in Q3 and Q4 2024. Further, as those who follow the company are aware, with a reduced and stabilized G&A, and of course, no exposure to operating capital costs inflation as a royalty company, the approximate 160% expected revenue growth from 2023 to 2024 should have a positive impact on a company's bottom line and cash generation through the rest of the year. Now, finally, as Dave mentioned, as a management group, we were focused on building a portfolio of quality growth-oriented assets to really future-proof the company. And then second, what we've done in the last 12 to 18 months is really creating a self-sufficient cash flow generating business. And that's where that transition point I mentioned earlier. And we've largely achieved that as a result of the accretive acquisitions we've made to date. The execution of this strategy has attracted some of the leading investors and finance providers in the resource sector. From private capital providers, such as QRC, Taurus, and Orion, to reputable public equity investors, and also strategic mine and project operators, We rarely have any issue with vendors taking back shares of gold royalty in these acquisitions. They do see the long-term prospects of our shares. In fact, these investors, amongst others, continue to be supportive of gold royalty's strategic vision and really do see the fundamental value upside in the company's shares as we build scale and relevance in the royalty and streaming sector. We're well on our way to moving up that valuation curve. So with that, I'll pass the presentation over to Peter who will step through an update on our portfolio.