Sandstorm Gold Ltd.

Good morning. My name is Michelle and I will be your conference operator today. At this time, I would like to welcome everyone to the Sandstorm Gold Royalties 2022 First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. Please be aware that some of the commentary may contain forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. After the speaker's remarks, we will have a question and answer session and instructions on how to queue up will be provided at that time. I would now like to turn the conference over to Mr. Watson. You may begin your conference, sir.

Thank you, Michelle. good morning everyone and thank you for calling into this 2022 q1 earnings call i will please to be able to once again talk about record results and in a few minutes i'm going to hand it over to irfan kazemi our cfo to talk about the specifics of the q1 results as many of you are aware last week we announced two company transforming acquisitions totaling 1.1 billion dollars u.s because of those transactions we're excited that In addition to these record revenue and cash flow results this quarter, we'll now be expecting new revenue and cash flow records going forward for years to come. When we announced these transactions last week, we went through a comprehensive presentation at that time. Therefore, I won't be going through it on today's call, but I would like to use this opportunity to remind everyone of a few key details of what the new SANS firm will look like to help investors better understand what they can expect from our financial results in the future. We really do believe that with these acquisitions, Sandstorm will be the go-to mid-tier streaming and royalty company. Not only will it be approximately 90% precious metals revenue, but we have what I believe to be a portfolio with the highest quality assets underlying its streams and royalties in terms of how low cost the underlying mines can produce their primary product for. In fact, 64% of Sandstorm's production will be coming from assets that produce in the bottom quartile of total all-in sustaining costs. Our portfolio is also now the most diversified in the entire industry, with only 38% of our NAV coming from our top five assets. Even the majors average 65% of their NAV coming from only five assets, which when you think about it is not really diversified. And finally, we have the highest amount of growth now built into our portfolio. As a quick reminder, and I won't go into detail on this morning's call, but the two transactions are an acquisition of one of our peer streaming companies called Nomad for an all-share deal that was valued at approximately $590 million U.S. on announcement, as well as a $525 million U.S. acquisition of a portfolio of royalties from a company called BaseCorp. Both of these portfolios are built on high-quality, low-cost, long-life minds, and we're very pleased to be bringing them into our portfolio. It's exciting that Sandstorm will now be the largest, highest growth, and most liquid mid-tier royalty company. I've been talking to many of our institutional investors since the announcement of the transactions, and 100% of the institutional shareholders that I have talked to are in favor of these deals. So it's rewarding to see that despite the broader stock markets falling apart, despite all gold companies treading off, including and especially Sandstorm, our institutional investors are very supportive of these deals and they very much like what the new Sandstorm is going to look like. And speaking of what the new Sandstorm will look like, you can see from this chart that Sandstorm will now be the largest intermediate royalty company by production, but we also have a lot of growth to go before our growth years slow down and we become like one of the majors. I believe we're moving into the most rewarding phase of Sandstorm's life, where we are large enough, strong enough, and diversified enough to be a safe, stable, and profitable company, but we still have enough creative growth ahead of us to be able to add further value to shareholders in the years to come. Once we close these acquisitions at $1,800 US gold prices, Sandstorm's cash flow after tax will be both substantial and diversified. And by 2025, our cash flow is expected to exceed $180 million US per year. And it's my expectation that our actual cash flow will be even higher than this for a couple of reasons. Firstly, because I expect commodity prices to be even higher than they are now. But secondly, because we're going to be continuing to buy streams and royalties between now and then. So with that, I'll hand it over to Irfan to talk about the quarterly results. But I hope that you can tell that I'm both proud of what Sandstorm has become. And upon closing of these acquisitions, Sandstorm will be the largest, the highest growth, and the most liquid mid-tier streaming royalty company in the world. Irfan.

Thanks, Nolan. It was certainly an exciting first quarter for Sandstorm with a number of big announcements for the company. It was also another quarter where Sandstorm broke a number of records. Let's look at some of these new records in more detail. If you're joining us via our webcast, this first slide shows the revenue and production numbers from the last four quarters. During the first quarter of 2022, Sandstorm realized record revenue of $35.4 million and sold 18,741 attributable golden ounces, also a new record. This compared to revenues of $31 million and approximately 17,400 ounces in the same period of 2021. The increase in revenue was due to a number of factors, including the additions of the Valley Royalties and the Vatikula Gold Stream. The Valley Royalties were added to Sandstorm's portfolio in June of last year, and the Vatacoola Gold Stream began making deliveries to the company in December. The increase in quarterly revenues was also part due to the rise in commodity prices when compared to the same period in 2021. In particular, a rise in diamond prices increased royalty revenue attributable to the Dyabic mine, and an increase in the selling price of copper contributed to higher revenue from the Chapada Copper Stream. The Chapada mine also had a 13% increase in the number of copper pounds sold. This increase in revenues was partially offset by some decreases in production of certain assets, which I'll touch on in a moment. It's exciting to see another record quarter for Sandstorm, and this is before we had announced the transformative acquisitions that Nolan described. Subject to closing those transactions, Sandstorm has increased its 2022 production guidance range to be between 80,000 and 85,000 gold equivalent ounces, increasing to 155,000 ounces in 2025. It's clear to see that this is shaping up to be a significant season of growth for Sandstorm. On the next slide, you'll see a summary of the first quarter results compared to the same period in 2021. Revenues in attributable gold equivalent ounces were up by 14% and 7% respectively. The $35.4 million in revenue came from $22 million in sales and $13.4 million of royalty revenue. Moving down the list, the average realized gold price in the company's gold streams for the first quarter was $1,887 per ounce. The average cash cost per tributary ounce was $283, which resulted in cash operating margins for the three-month period of $1,604 per ounce. In a time when we're seeing increasing inflationary costs on all fronts, it's remarkable to see operating margins like this, and I think it's a testament to the royalty business model. This quarter, cash flows from operating activity, excluding changes in non-cash working capital, was up 16% from the first quarter of 2021, at $26.7 million. It represents another new record for Sandstorm. Finally, net income was $9.1 million, which is an increase of about 80% when compared to the same period in 2021. This was primarily driven by the increase in revenue, as well as an increase in the gains recognized on the revaluation of the company's investments that go through the P&L. As you may know, Sandstorm began paying its first dividend this year and recently paid the second quarterly dividend out to shareholders. We're very pleased to be able to add another way to allocate capital back to shareholders. Looking at the contributing assets for the first quarter, we see the Yamana Silver Stream as the largest producer, which is on the Saramoro mine at approximately 4,500 attributable gold ounces. Next to Saramoro, is the Chapada Copper Mine with approximately 3,200 ounces, followed by Relief Canyon, the Valley of Royalties, and Diavik, which I discussed earlier. The increase in gold equivalent ounces sold compared to the first quarter in 2021 was partially offset by a decrease in ounces sold from the Santa Elena Mine and the Karma Mine. The decrease at Santa Elena was partly due to decrease in production at the mine as well as the timing of sales. At Karma, The decrease was primarily due to the conclusion of the five-year fixed delivery period in accordance with the terms of the Gold Stream. Sandstorm Stream and the Karma Mine is now at 1.6% of production. Portfolio diversification has been a key tenant underlying the previously discussed announcements this year. As these transactions close over the course of 2022, I expect this list will look very different a year from now. will be adding more high-quality and low-cost assets to Sandstorm's portfolio that I think will nicely complement these existing royalty and stream assets. The next slide provides a breakdown of the quarter's attributable gold equivalent ounces by region. Sandstorm's production continues to be largely weighted towards mining assets located in the Americas, with South America contributing nearly two-thirds of production. Approximately one quarter was attributable to North America, of which 18% came from mines in Canada. Finally, I want to mention the upsized credit facility that we announced alongside the BaseCorp Nomad transactions. Sandstorm has secured a commitment to upsize their existing revolving credit facility to $500 million US. In addition, will have $125 million uncommitted accordion feature for total credit capacity $625 million U.S. The upsize is conditional on meeting the closing requirements for the base core transaction and the accordion features contingent on closing the Nomad acquisition. The credit facility also maintains the sustainably linked incentive pricing which we announced last fall, a first for a royalty company. This increase in credit capacity ensures that Sandstorms continues to be position for future growth, even with the announcements we've made this quarter. And with that, I'll turn the mic over to Dave to highlight some of the new assets included in the transactions we recently announced. Dave?