Sandstorm Gold Ltd.

Good morning, my name is Joanna and I will be your conference operator today. At this time, I would like to welcome everyone to the Sandstorm Gold Royalties 2023 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 in future events could differ materially from those anticipated in such statements. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, please press star, then the number two. Thank you, Mr. Watson. You may begin your conference.

Thank you, Joanna. Good morning, everyone, and thank you for calling into this Q1 earnings call. In a minute, I'll hand it over to Irfan to discuss the Q1 results, but before that, I just wanted to provide a high-level update on a few qualitative things that have occurred over the past few months that are worth noting, specifically four things that I think are material. The first of those things, and most material, which was announced earlier this week, is that SSR, a multibillion-dollar Canadian mining company, has announced that they're buying a 40% interest in the Hodmodern project from Lydia. I'll let Dave talk about this a little bit more when he gets to his part of the call, but this is obviously a positive update for us as we believe that they're This will give Sandstorm shareholders and prospective shareholders much, much more confidence that HodMod will be built and is progressing immediately into construction. This leads me to my second update that I think is worth mentioning. As soon as the announcement was made on Monday after market close about SSR and HodMod, some of our investors and prospective investors saw this as such good news that they made a bid to one of our shareholders that we inherited from the base core transaction. for their entire block of $50 million Canadian worth of Sandstorm stock. This was a block of shares that was understood by the street that was potentially available for sale and it was causing some pressure on our share price. And that purchase of shares successfully happened this week. In addition to that, it's worth mentioning that one of the shareholders that ended up with Sandstorm shares as part of the Nomad acquisition was Yamana, who also had nearly $50 million Canadian in Sandstorm shares And Yamana was recently purchased by Pan American Silver, who is liquidating a lot of its non-core share asset base. And they also sold their entire block of $50 million worth of Sandstorm shares in the past couple of weeks. So in the past couple of weeks, we have now successfully cleared around $100 million worth of shares, which were purchased by new shareholders. So I think that's a good thing and removes a bit of the overhang. The third thing that I think is worth noting before I turn it over to Irfan is that On the quarterly calls of the other streaming and royalty companies, they have been discussing the impacts of the new proposed global minimum tax of 15%. This is something that the OECD has had in the works for nearly the past decade, and it's finally coming to fruition, where it's expected that all companies, including streaming and royalty companies, will have to pay an effective tax rate on their global earnings of at least 15%. Specifically, this impacts other streaming and royalty companies who have structured themselves offshore and outside of Canada to minimize tax. As we have noted many times in the past at Sandstorm, we have purposely structured ourselves so that we do pay tax in one jurisdiction or the other, such that this new global minimum tax, which some of our competitors expect to start affecting them in the next couple of years, does not at all affect Sandstorm. I know that some people are concerned about how this tax will affect streaming and wealthy companies, and I'm pleased to say that it is not expected to affect Sandstorm in any way. Finally, I think it's worth noting that with today's gold prices that are above $2,000 per ounce, our debt repayment is happening at a rapid pace. Nine months ago, we had over $625 million of debt. By the end of this quarter, we expect that to be down to $450 million and dropping rapidly. One year from now, I expect our debt to be sufficiently reduced into the mid-$300 million range. And I also expect at the same time that our equity and debt investments in other mining companies to be in a similar $300 million range, such that next year our net of our investments in other mining companies should be effectively zero. I think it's worth noting that we're very proud of the company that Sandstorm has become. We're excited about our collective future. I would be remiss, however, if I didn't acknowledge that along the way in building this company that there have been some bumps along the road. I say this to acknowledge that we're not perfect as a team, and we recognize that we have a very intelligent investor base that we value the feedback of. For our investors, it's worth noting that your opinions vary so greatly that many of you disagree with each other such that we can't follow everyone's advice. However, it doesn't mean that we don't want to hear that advice. Even when our own shareholders disagree with each other, hearing each shareholder's opinion is helpful to us. Having over 50,000 investors, it makes it impossible for me to hear and synthesize every individual investor's thoughts, but we have recently decided to do our best and to create a new portal on our website where you can fill out your thoughts and the feedback will be reviewed by a member of our team. Feedback that is considered both constructive and thoughtful will find its way specifically to my desk so I can review it and help our senior management team make decisions that take into account what we're hearing from shareholders. In the 18 years that I've been a C-level executive of New York listed streaming companies, I received a lot of feedback and some of that feedback has improved and changed how I view the business. and we're proactively looking for more of that feedback. I myself am not only a significant Sandstorms shareholder, but over the past nine months I've purchased another $2.5 million worth of Sandstorms shares with my own money because I believe the share price will go up. Clearly, I want the share price to be as absolutely as high as possible, and I'll be endeavoring to accomplish that. And to the extent that you can provide feedback that will help that objective come true, please do so. So for those of you who want to do that, the web address is sandstormgold.com forward slash feedback. And with that, I'll hand it over to Irfan for the detailed results. Irfan.

Thanks, Nolan. In terms of the financial results, Astron had a very strong start to the year, setting a number of new quarterly records. Sandstrom sold over 28,000 of Trueville's gold equivalent ounces during the first quarter and realized revenues of approximately $44 million, both a quarterly record for the company and an increase of 24% for the comparable period in 2022. Early in the quarter, we received a one-time contractual payment of $10 million from a Mount Hamilton royalty. This resulted in a quarterly record of $54 million in total sales, royalties, and income from other interests. Larger macroeconomic conditions help drive the price of certain commodities higher. As a result, the average realized gold price per ounce for the company's gold stream was $1,882, which is comparable to the first quarter of 2022. We continue to see indicators for a strengthened gold market, and Sandstorm's portfolio is well positioned to profit from these rising gold prices. Diving into the details of the financial results a bit further, Revenue was comprised of $26.4 million from sales from our streaming contracts and $17.6 million from our royalty assets. Sandstorm's average cash cost was $230 per trivial gold equivalent ounce, down approximately 20% from the comparable period in 2022. This resulted in cash operating margins of $1,652 per trivial ounce. These are impressive margins that are indicative of a quality set of assets and also low-cost mining operations underlying our portfolio. Cash flows from operating activities, including changes in non-cash working capital, was nearly $43 million for the quarter, a 60% increase from the first quarter in 2022. Net income was $15.6 million, or $0.05 per share on a diluted basis. Looking at a breakdown of the assets that contributed this quarter, Cerro Moro, Antemina, and Chapada were the top-performing assets, contributing approximately 35% of attributable gold equivalent ounces. Lundin Mining, the operator of Chapada, recently updated the Chapada Mineral Reserves and Resources and reported that exploration success at Chapada has offset mine depletion since the previous mineral estimates. The operator also released a maiden estimate on the Suava deposit, which is located within Sandstorm's streaming grounds. There were other positive operational updates to assets, including the Fruta del Norte and Cateronas mines, which I'll let Dave speak to in a moment. As many of you will recall, Sandstorm purchased a net profits interest on the Antemina copper mine in the second half of 2022, and we're encouraged to see strong results from this asset in the first quarter. In addition to Antemina, Bonacro, Cacerones, and Blybor, and additional streaming contracts of the Mercedes mine in Mexico are new to this list when comparing to the same period in 2022. It's exciting to see these assets on this list generating meaningful cash flow to Samsung shareholders. The other category, which includes production from the other 27 royalties not specifically listed here, contributed nearly 9,000 attributable gold equivalent ounces. Sandstorm now has 40 cash-flowing assets in its portfolio and many more in development, a truly diversified royalty company. From a jurisdictional perspective, Sandstorm's production remains primarily focused in the Americas, with 41% of gold equivalent production coming from North America. In the comparable period in 2022, production attributable to North America was 28%. This increase in the Americas was primarily driven by the addition of some of the streams and royalties I mentioned earlier that were acquired in the Nomad and Base Core transactions, as well as an increase in attributable ounces from the Fruta del Norte mine in Ecuador and the Arizona mine in Brazil. Finally, I'd like to make a quick mention of the progress on Verizon Copper in the transaction with Sandstorm relating to the Antemima MPI. Horizon recently announced a $20 million financing, which was more part of the cash consideration table to Sandstorm. Horizon is working diligently in the background to complete the transaction, which we expect to close over the coming month. With that, I'll turn it over to Dave for some further updates on our assets. Dave.