Triple Flag Precious Metals Corp. Common Shares

Hello, and thank you for standing by. At this time, I would like to welcome everyone to Triple Flag Precious Metal T1 2024 conference call. All lines has been placed in mute to prevent any background noise. After the speaker's remarks, there'll be a question and answer session. If you would like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. I would now like to turn the conference over to Sean Osborne,

chief executive officer please go ahead thanks jericho good morning everyone and thank you for joining us to discuss triple flag's first quarter of 2024 results today i'm pleased to be joined by our cfo sheldon vandercoy and for the first time our director of mining james leal who will join us for the q a portion of the call James is a mining engineer and is responsible for portfolio management and supports technical diligence at Triple Flag. As a background, James has over 20 years of experience across mine sites, head offices, and consulting, most recently as head of Canada at MiningPlus. Triple Flag achieved a new quarterly GEO sales record to start the year, with sales of roughly 28,000 gold equivalent ounces, resulting in 48 million US dollars of EBITDA during the quarter. The strong performance is positioned as well to achieve our 2024 geo sales guidance of 105 to 115,000 ounces. Most notably, in line with our guidance for a stronger 2024 due to higher gold grades from the E31 open pits at North Parks, a flagship asset delivered a nearly 90% increase in geo sales quarter on quarter. We continue to expect these pits to deliver high grades through at least 2024 and 2025, and look forward to a feasibility study for the E22 underground ore body, which our partner Evolution expects to complete by the end of Q2 of this year. E22 is expected to represent another source of high-grade gold ore at North Parks in the medium to long term. In March of 2024, we surfaced further value from the Mavericks portfolio with a settlement agreement reached with Queer Mining on the Kensington NSR Royalty, which has commenced paying and will be discussed later in the presentation. Finally, I'd be remiss not to mention the current favorable precious metals price environment, which on the back of sustained central bank buying, Chinese retail purchases, and seemingly never-ending geopolitical uncertainty has remained at near record levels for gold prices and solid silver prices. It's been a great time to have continued meaningful GEO growth in our portfolio coincide with a period of strong price support. We expect to deliver our eighth consecutive year of record GEO sales in 2024, and with the first quarter of high-grade growth from North Park's now achieved, we look forward to the prospect of continued higher gold and silver prices on our portfolio's cash flow per share. I'll now turn it over to Sheldon to discuss our financials for the first quarter of the year.

Thank you, Sean. As noted, we had a strong first quarter with the portfolio producing just under 28,000 GEOs, which puts Triple Flag right on track to achieve our 2024 guidance. As expected, North Parks and Cerro Lindo are the two largest contributors to Q1 production, with North Parks showing year-over-year growth due to the higher gold grades realized. In Q1, we also recorded our first revenues from the Kensington Royalty, which we acquired as part of the Mavericks portfolio. The strong Q1 production and the record quarterly gold price resulted in record levels of revenue and adjusted EBITDA, significantly higher than the prior year period. Operating cash flow per share is the metric that I am most focused on. Our operating cash flow before working capital and taxes increased over 22% as compared to the prior year period. But as a short-term timing matter, our working capital increased by $6.5 million in Q1, resulting in bottom line operating cash flow in the quarter that was unchanged from the prior year. Typically, our adjusted EBITDA and our operating cash flow track quite closely, and I expect that this will continue to be the case for 2024 as a whole, as the shorter-term working capital changes reverse. For 2024, we are well positioned to drive increases in operating cash flow per share, as we are realizing higher production levels from our existing portfolio, and the higher gold price is translating into increased cash flows. In Q1, the gold price averaged $2,070 per ounce, a quarterly record. But in Q2 to date, the gold prices averaged over $2,300 an ounce, a significant increase over Q1. We view a growing dividend as a core part of our capital allocation strategy. In this quarter, our dividend has been maintained at 21 cents on an annualized basis. I'm proud that we have increased our dividend every year since our IPO. We will continue to assess the potential for further increases going forward. In addition to our dividend, we also returned over $3.5 million to shareholders via share buybacks in Q1. Last, I'd like to comment on our balance sheet. We exited the quarter with net debt of just $30 million, or less than one quarter of cash flow. A clean balance sheet, robust cash flows, and our revolving credit facility of over $500 million gives us the financial capacity to deploy capital to drive further growth for the benefit of shareholders. Going to the next slide. We continue to highlight 3 key aspects of our investment thesis, namely asset diversification, precious metals focus and a portfolio, which is predominantly centered in Australia and the Americas. Our asset diversification is well understood. So, continuing on Sean's earlier comment about a strong precious metals environment, I would like to highlight triple flags 98% exposure to precious metals and Q1 2024. This pure play exposure ranks among the highest in the sector with a meaningful portion weighted to silver at 34%. I feel fortunate to have this level of exposure given the many favorable tailwinds for both gold and silver in the near to medium term. Finally, our portfolio is predominantly located in mining friendly jurisdictions, a key criteria as we look to expand our portfolio through acquisition. By geography, the country with the single greatest contribution remains Australia. Notably, during the quarter, another one of our Australian assets was featured as a core part of an M&A transaction, with Westgold announcing a friendly takeover of Corora to operate the Beta Hunt mine. We are pleased to have the cash flow and exploration potential for Beta Hunt spotlighted by Westgold. That's you, Sean.