Wheaton Precious Metals Corp

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Wheaton Precious Metals 2025 First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. 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 1 on your telephone keypad, or type your answer into the Q&A box of the webinar. If you would like to withdraw your question, press the pound key. Thank you. I would like to remind everyone that this conference call is being recorded on Friday, May 9th, 2025 at 11 a.m. Eastern Time. I will now turn the conference over to Emma Murray, Vice President of Investor Relations. Please go ahead.

Thank you, Andrew. Good morning, ladies and gentlemen, and thank you for participating in today's call. I'm joined today by Randy Smallwood, Wheaton Precious Metals President and Chief Executive Officer, Vincent Lau, Senior Vice President and Chief Financial Officer, Haitham Hodale, Senior Vice President, Corporate Development, and Wes Carson, Vice President, Mining Operations. Please note, for those not currently on the webcast, a slide presentation accompanying this conference call is available in PDF format on the presentations page of our website. Some of the comments on today's call may include forward-looking statements. Please refer to slide two for important cautionary information and disclosures. It should be noted that all figures referred to on today's call are in U.S. dollars. With that, I'd like to turn the call over to Randy Smallwood, our president and chief executive officer.

Thank you, Emma, and good morning, everyone. Thank you for joining us today to discuss Wheaton's first quarter results of 2025.

Before we begin, I would like to take a moment to honor founding board member Peter Gillen, who passed away last week. As our longest serving director, Peter played a pivotal role in shaping Wheaton into the company that it is today. His unwavering integrity, strategic vision, and deep commitment left a lasting impact on all of us. More than a respected leader, Peter was a trusted colleague and a very dear friend. On behalf of the board of directors, management, and staff, we extend our heartfelt condolences to Peter's family and loved ones during this difficult time.

I'd now like to turn back to our quarterly results, which mark a very strong start to the year.

With several of our core assets exceeding production expectations, we delivered record quarterly revenue, adjusted net earnings, and operating cash flow. Looking ahead, 2025 is shaping up to be a catalyst-rich year, with four development projects scheduled to come online over the course of this year. Notably, the Blackwater mine owned by Artemis Gold achieved its first gold and silver pour in January, and just last week announced commercial production. Our corporate development team remains actively engaged in evaluating new opportunities, and we continue to see a healthy appetite for streaming as a competitive source of capital for the mining industry. During the quarter, we were once again recognized amongst Corporate Night's 100 Most Sustainable Corporations in the World for 2025, a multi-sector accolade that we are very proud of. As founders and architects of sustainable streaming, this accomplishment is reflective of our continuing commitment to operate responsibly in all facets of our business. This includes our work to help build healthy, vibrant communities through purposeful investments wherever our partners' stream-related operations are located. Following the success of Wheaton's inaugural Future of Mining Challenge, an initiative that seeks to support the mining industry to become more efficient while minimizing its environmental impact, I am pleased to announce the theme, the 2025-2026 initiative, will focus on sustainable water management, an exceptionally important component to any mining operation. The company will begin receiving expressions of interest next month, so please stay tuned for further details. And with that, I would now like to turn the call over to Wes Carson, our Vice President of Operations, who will provide more details on our operating results. Wes?

Thanks, Randy. Good morning, everyone. Overall production in the first quarter has been higher than expected, primarily driven by strong outperformance at SLOGO. In the first quarter of 2025, SLOGO delivered over 71,300 ounces of attributable gold production, an increase of approximately 16% compared to Q1 2024. primarily driven by higher throughput and grades. Strong overall performance this quarter reflects the ongoing ramp-up of the Slobo 3 expansion and continued operational improvements at Slobo 1 and 2. On March 4, 2025, Valley Base Metals informed us that the second phase of the Slobo 3 expansion had been completed, having achieved a sustained throughput capacity of over 35 million tons per annum over a 90-day period. Following our review of the test results, Wheaton advanced the final expansion payment of $144 million to valet base metals in early April. Sancia produced over 550,000 ounces of attributable silver and 4,900 ounces of attributable gold in Q1 of 2025, a decrease of approximately 13% and 65% respectively compared to Q1 2024. The reduction to gold and silver production was expected and due mainly to lower grades ore material was mined from the Constantia pit and reclaimed from the stockpile compared to the prior year. Papakanchi deposit, which contains relatively higher gold grades, is expected to be depleted by early 2025. As Randy stated, we were excited to see the Blackwater announce the first gold ore and silver in the first quarter, resulting in a tributal production of 1,000 ounces of gold and 35,000 ounces of silver. Most recently, on May 2, Artemis declared the commercial production had been achieved at the Blackwater Mine, delivering in excess of 90% of its planned tonnage. Production is expected to increase throughout the year as Artemis continues to ramble. Production outlook for 2025 remains unchanged, with total attributable production expected to fall between 600,000 and 670,000 gold equivalent ounces. Production is forecast to be consistent at Slobo through the remainder of 2025 with slightly lower grades as per the mine plan, offset by increasing throughput across Slobo 1, 2, and 3. Production in Antamina is forecast to increase over the remainder of the year due to expected higher silver grades caused by the ratio of copper zinc ore versus copper-only ore being 2025. Production from Mineral Park, Goose, and Platte Reef continues to be forecast for the second half of 2025. construction of these assets proceeding in line with expectations. Looking ahead, we project annual production to grow at an industry-leading rate of approximately 40%, reaching 870,000 GEOs by 2029. This growth will come from operating assets, including Antimedia and Blackwater, with additional contributions from development projects that are currently under construction and or permitted, such as Mineral Park, Goose, Platte Reef, Kermuk, Kone, Phoenix, El Domo, and Copper World. Furthermore, attributable production is forecast to average over 950,000 GEOs from 2030 to 2034, incorporating expected additional incremental production from these pre-development assets. That concludes the operational review, and with that, I will turn the call over to Vincent.

Thank you. As described by Wes, production in Q1 was 151,000 GEOs, a 4% decrease from Q1 of 2024, due mainly to the lower production from Penosquito and Constantia, partially offset by higher production from Solobo and Antamina. Sales volumes were 161,000 GEOs, an increase of 16% from Q1 of 2024, as strong production levels in Q4 of 2024 resulted in an increase to sales realized in Q1 of 2025, due to the inherent timing delay between production and sales. As at March 31st, 2025, Approximately 136,000 GEOs were produced but not yet delivered, or PB&D, which represents approximately three months of payable production. The company expects PB&D levels to stay at the higher end of our forecasted range of two to three months by the end of 2025, in part due to the ramp up of new mines forecast to commence operations in the second half of the year. Strong commodity prices, coupled with our strong production resulted in record quarterly revenue of $470 million, an increase of 59% compared to the prior year, with the increase due mainly to a 36% increase in realized commodity prices, coupled with the 16% increase in sales volume. Loss margin increased by 86% compared to the prior year to $319 million. Notably, year-over-year margin growth exceeded the appreciation in gold prices over the same period, underscoring the effectiveness of our business model in leveraging rising commodity prices while maintaining strong cash operating margins. Adjusted net earnings amounted to $251 million, representing a quarterly record and an increase of 53% compared to the prior year. Wheaton delivered robust cash operating margins in the first quarter, resulting in record quarterly cash flow from operations of $361 million, an increase of 65% compared to the prior year, and declared a dividend of 16.5 cents per share, an increase of 6.5% compared to the prior year. For 2025, the company continues to expect that G&A expenses will amount to approximately $50 million. During the quarter, Wheaton paid total upfront cash payments for streams of approximately $95 million, including $40 million for Menor Park, $30 million for Blackwater, and $25 million for Phoenix. Overall, net cash inflows amounted to $267 million in the quarter, resulting in a cash balance of $1.1 billion at March 31st. This cash balance, combined with the fully undrawn $2 billion revolving credit facility, positions the company exceptionally well to satisfy its funding commitments and acquire additional accretive streams.

That concludes the financial summary, and with that, I turn the call back to Randy. Thank you, Vincent. In summary, the first quarter was a very strong start for the year for Wheaton, distinguished by several key highlights.

We achieved record three-month revenue, earnings, and cash flow, and declared a $0.165 quarterly dividend, a 6.5% increase from Q1 of 2024. Our pipeline of development projects was further de-risked by construction advancements from multiple assets scheduled to come online within the year, further supporting our impressive anticipated organic growth profile of over 40% by 2029. We continue to maintain low and predictable costs, which, when coupled with our leverage to increasing commodity prices, result in some of the highest margins in the entire precious metal space. Our balance sheet also remains strong providing ample capacity to add accretive, high-quality streams into our portfolio. And lastly, we take pride in being a leader amongst precious metal streamers in sustainability by supporting our partners and the communities in which we live and operate.

So with that, operator, I would like to open up this call for questions. Thank you.

Ladies and gentlemen, we will now conduct a question and answer session. If you would like to ask a question, please press star, then the number one on your telephone keypad. If you would like to withdraw your question, please press the pound key.

There will be a brief pause while we compile the Q&A roster. Your first question is from Cosmos Chu from CIBC.

Please go ahead.

Thanks, Randy and team, and welcome, Vincent. Congrats on a very strong or record earnings for Q1. Maybe my first question is on the sales versus production. Vincent, as you mentioned, production was 151,000 ounces and sold was actually higher. And as you kind of pointed out, usually production is higher than sales. My question is, is there any kind of read-through into future quarters, or is this really a reflection of what has happened in the past? I guess you kind of answered it by talking about PB and D being consistent, and so I guess I'm trying to confirm, should we just kind of model sales and production being fairly consistent on a go-forward basis?

Yeah, so on a production basis, we're a bit

back-end loaded this year in terms of the production levels. So being at the higher end of the range that we're forecasting throughout the year, you would expect some pickup in the PB&D. So about three months is what we're forecasting. So I think you're right. You're going to see production levels being at the similar levels as the sales, but factoring in this PB&D movement.

Cosmos, if I could add, you know, a lot of the, we had a really good fourth quarter, but that overproduction came from Slobo, which is copper concentrates. And it's usually the copper concentrates that take longer to make it through to sales, just because you've got to ship that concentrate overseas and run it through the whole smelting and then refining process. So it's, you know, if you look at it, the PB&D, and it shows it right in the charts on the presentation, it's dominantly gold, and most of our gold comes in the form the mines themselves so so the fact that we were so high in in the fourth quarter in production at slovo we we saw you know great production out of slovo in the fourth quarter you know we always knew there was going to be a good boost to the sales side in the first quarter because that concentrate takes that long to come through and so you know it it's always going to have it's always going to be biased more towards the gold production because most of our gold production does come from copper assets and therefore that pushes us more towards the three-month limit versus with DORE, which is where most of our silver is, it's typically about two months for us to convert it to sales.

That's right. Thanks, Randy. Maybe that leads in well to my next question here. So, Lobo, you made the final payment on the expansion, $144 million on April 4th, 2025. I can't read my writing. In April 2025. But that might not be the last payment. I believe there could be the potential to make additional payments of $5.1 to $8.5 million annually if they do go with a high-grade sort of mine plan. Any updates on potential for you to need to make that payment or any kind of color on the high-grade mine plans?

Thanks, Cosmo. They are working on that high-grade mine plan. It really is a higher movement they need from the mine is the main kind of factor in that, along with a higher copper grade from the mine, or consistently higher copper grade from the mine. So Slovo has been working towards that over the last several years. It's not imminent that we're going to hit those levels, though. We continue to monitor it with Valley-based metals, and we'll continue to speak to them about it, but I don't see that happening within the next year or so, sir.

For sure. And then, you know, Wes or Randy, I saw in your longer-term growth profile you've included Copper World. Could you maybe give us an update on Copper World? Is that now considered fully permitted, quote-unquote, because, you know, I was reading up on your PMPA once again, I guess it says, you know, $50 million per could be advanced upon HUD-based receipt of permitting. And so I guess number one, timing. Number two, is it considered fully permitted? And number three, this is a negotiation that was completed many years ago, $230 million. Any kind of potential changes to that number?

Yeah, no, it's not a negotiation. It was a contract that was signed many, many years ago. And so it's a contract that's in place.

Contract, yeah.

Yeah, yeah. And so it's a contract that's in place. You know, there's no money that gets advanced until HUD-BAE delivers not only all permits, which they do have, but they also have to have proper financing in place that satisfies us that they've got the capacity to get the project built. And they also have to commence construction. And so, you know, there will be no payments from us until that happens. I think in our current five-year guidance, we might have it at the tail end, just the very tail end of the five-year guidance. And it's not significant from a production perspective in terms of getting to the 40% growth. You know, we think it's probably five to six years out. I'm hopeful that Hudbay moves that faster forward. It's an impressive project. You know, the Rosemont project, And then the Copper World area itself, all, you know, sort of one collective zone that we're appreciative, you know, in terms of that exploration success that we were originally purchasing, what, 15 years ago, has actually turned into the main resource that's going to be started off at the Copper World. But it's, you know, it's all part of the project going forward. HUD-BAE is a very important partner to us. We are always trying to find ways to support our partners on a go-forward basis. But we have to be reflective of value. I know there's been lots of talk in the marketplace about how that's going to move forward. We've got a contract in place and we look forward to working with HUD-BETA to move this forward. I think their focus currently right now is looking for a joint venture partner to try and offset some of the capital expenses that are going into this project. So, you know, we look forward to helping them.

So, Randy, I guess your advancement of any payment will not happen until a joint venture partnership or joint venture partner is in place.

Well, I mean, we would start, I mean, that's if they have to go down that path. If they choose not to go down that path, all they have to do is come up with a financial plan that we're satisfied with, a financing plan, the capacity to fund it. And so, So whether they choose to do that with a joint venture partner or choose to find a way to do that internally within themselves and keep 100% ownership of the asset going forward, it is an impressive asset. And so I'm not sure the logic behind that outside of sourcing capital to help get the project built. But it's not contingent on them finding a joint venture partner. It's contingent on them having a satisfactory financial plan. Yeah, exactly. And so whatever way they choose to get there, that's their choice. That's not contingent on us.

Great. And then maybe one last question, switching gears a little bit on Cobalt. Not the biggest part of your portfolio, but I noticed that the production has increased. Kind of makes sense given that they're ramping up. So two parts of my question. I guess number one, it's at 540,000 pounds now in Q1. Is that going to continue to increase, number one? And number two, I noticed that shipping or sales was only about half of that 540,000 pounds. And it's always lumpy. So again, how should we model the shipment or sales, which in turn affects earnings?

Yeah, thanks, Cosmo. So they did have an exceptional first quarter there. For the rest of the year here, we're forecasting really slightly lower than that, but kind of consistently in more of that kind of £450,000 a quarter kind of range. And really the sales are very lumpy on that one. And it's really just because of the shipments on that. They go over to Europe and we get paid kind of at that point when they go over there. So there is quite a lag in that. And we will see those sales start to catch up over this quarter with that production. So it is that they've had a great ramp up there over the last really 18 months. They did announce kind of that they completed earlier this year as well, the undergrounds, and they are at full production on those. So it's been a long project to get it going. It's the worst one in our portfolio that got affected by COVID for sure. So it's great to see them up and running and getting that consistent, the high-quality production out of there.

Yeah, and I forget what, there's 2 million pounds in annum. Is that what they're aiming for after the expansion? I just, I don't remember.

Yeah, to our account, yeah. Yeah, in that range. That's to our account. To your account, yes, for sure.

Yeah, 42.4%.

Cool. Thanks, Randy, Wes, and Vincent. Thanks for answering all my questions, and have a good weekend.

Thank you, Cosmos. Your next question comes from Daniel Major from UBS. Please go ahead.

Hi. Thanks so much for the questions. So, yeah, to start with, Antamine has had some downtime this quarter. Can you provide any feedback you might have had from the joint venture and potential impacts it might have on the profile in the second quarter or indeed the full year?

Thanks, Daniel. So they did have, obviously, a very unfortunate incident there this past month ago now. And really... It's one of those things that we have been in contact with the partner on it, and it's very, very unfortunate to see those types of things happen. We keep a very close eye on the safety record of all of our operations, certainly. They were down for about 36 hours due to the incident. We don't expect it to affect production for the year at all. We are actually headed down to site in a couple weeks here, so we'll get a good idea of what things look like for the rest of the year after that. But at this point, don't expect any change to our current forecast.

Okay, thanks. And then maybe just to follow up on Antamina, where are you looking at in terms of the delta into 2027 as you see it in terms of the mine plan? Sorry, yeah, 26, 27 relative to where we are today, Antamina just specifically.

We are seeing a fairly significant ramp up this year as they move back into those copperworks. have quite a bit higher silver in them than what we've seen the last couple of years and we do expect that to continue through 26 and 27 as well and they have moved that primary crusher out of the bottom of the pit now and there was quite a bit of high grade that was tied up with that so so they are moving into really a higher grade silver zones over the next couple years which is why you do see that wrap up in production great thanks um and then a

The next question, I appreciate it's associated with the movement in the share price, but you put $12 million in share-based compensation this quarter. How's the distribution through the year, and if shares stay the same here, should we expect a similar run rate, or how should we be modeling that line item?

Yeah, the $12 million this quarter is really driven by the share price self-performance Run rate on the PSU side would be around 3 to 4 million going forward per quarter.

3 to 4 million a quarter. Okay. Yeah. Thanks. And then, yeah, that's useful. Thanks. And then just final question. I mean, you've got 1.1 billion on the balance sheet. I guess you're always looking for opportunities, but is there any... sort of scope if the prices stay at this kind of level to, you know, look at interim distributions or changing the structure of cash returns, or are you just firmly going to accrue cash and look for deals?

Maybe I'll take that question, Daniel. Let's take them. Thanks for the question. I will say that, you know, given the number of opportunities that we have in the pipeline right now, and it's definitely double digit, and we're seeing a lot of, different development stage opportunities looking for funding. We're seeing higher commodity prices are prompted, the sale of existing secondary royalties. We're seeing balance sheet repair opportunities, and we're also seeing rationalization of assets by larger seniors. So there's so many opportunities right now for the potential expenditure of capital towards streaming projects and then some larger royalty opportunity as well that we are pretty comfortable with our existing structure.

Yeah, Daniel, if I would just add, I mean, you know, this run up in gold prices and what we've seen is actually really starting to firm up enough that people are starting to make commitments into building. And so what we are seeing a lot of is gold streams on gold mines or silver streams on gold mines. There's lots of activity there. I'd love to see a bit of strength in the copper space because there are some pretty promising copper projects out there. that are kind of waiting for, I think, a bit better cost base to make decisions to go into construction. But there's definitely a lot of activity on the gold side.

Just because we've got a billion dollars at the end of the last quarter, keep in mind we've managed to spend almost $900 million a year for the last 10 years. So there are lots of opportunities. It may be a little bumpy, maybe one year is more than the other, but we've never had an issue deploying capital accretively.

Great. Have a great weekend. Thanks, Daniel. Thank you.

Your next question is from Tanya Jackiskolnik from Scotiabank. Please go ahead.

Yes, good morning, everybody. And again, my sympathies for Peter. Very sad to see that news.

Thank you for that, Tanya.

I'm going to start. A lot of my questions have been answered. I'm just going to follow up on just a few things that I just wanted confirming. And just on the distribution for the year, I think in the last conference call, we talked about a 45-55 first half, second half in terms of the production profile. Is that still the case with all the startups towards the second part of the year?

Yeah, thanks, Annie. With the strong performance in Q1, we're actually looking at about kind of $47.53 now, I would say, if you kind of measure it that way. So it's still back-end loaded, but a little bit less so than that.

Okay. And obviously, you know, depending on what the prices do, that obviously moves the, you know, not your production, but just in case, you know, for the rest of us, the geo sales. Anyway, yeah, I got it. Just on the... And then the P... uh, B and D we'll just follow along with that 47, 53. Yeah, exactly.

Yeah. Yeah.

We are, we are blessed with the fact that a lot of the new mines that are starting up are producing, uh, uh, Dore. And so, uh, you know, uh, as, as that new production does come on, it won't be as long now, you know, whenever a new mine starts up, you have to get systems in place and such. And so there's probably going to be a bit of initial delays in terms of converting that to sales, but, uh, But yeah, there's not a lot of growth on the concentrate side in our portfolio over the next while. It's mostly in the DORE side.

Okay, that's good. And then if I could circle back to Copper World and just what Hutt Bay is looking for, a financing partner to take on some of the risk. I just want to try and understand if you would increase your exposure further to this asset, but more on a stream basis rather than – because you said you'd help with the – support them. I just wanted to make sure it wasn't as a joint venture partner, but more – Yeah, it definitely wouldn't be as a joint venture partner.

It's not in our business model to take that level of risk, and that's one of the reasons why we – have value for the streams that we acquire is to gain that confidence for our shareholders. And so it definitely would be as a joint venture partner. However, you know, there's opportunities. One of the challenges is that the current stream is for 100% of the gold and the silver. So we already are getting 100% of the precious metals from that project. But there are other ways to expand the relationship to provide support, whether it's, you know, we've always said that We're not chasing copper, but we would take it as ancillary support to help a project go forward, and so maybe that's an option. They've also got some pretty good gold production from other assets within their portfolio. That's also an option in terms of us being able to access and stream. HUD Bay is a pretty wide, diverse company. We've already got a good, healthy stream with them at Constantia. which of course isn't operating anymore and it underperformed for us in the past. So it's been a long and healthy relationship and we're looking forward to continuing to grow that relationship in a supportive role whichever way we can. They've got a good operating team, they've got a good management team, they've got a good track record in terms of bringing projects like this on. Constanze has been a huge success and so we're going to be there whichever way we can. Their focus right now, as I stated publicly, is sourcing a potential joint venture partner to help spread it out. We're not sure that they need to do that, but that's something that they have to answer for themselves and come forward. So we're going to do everything we can to help them.

Okay. Thanks for the clarification. Just didn't want to see anyone getting in as an operator. I've seen that movie before. Just on the operating environment, sorry, the deal environment, if I can circle back. And thanks, Haytham, for some of the color. I just wanted to come back on a couple of things in the environment that you're seeing. Have you seen the deal size increase at all?

Yes.

Yeah. Okay. So it has to be... Yeah.

There's still a lot of the smaller deals are still out there, Tanya, but we are seeing some of the larger deals. And, you know, I'd say the range is still from initially on the smaller deals was 1 to 350. There are a handful of larger deals that are 500 to a billion now. And so there's lots of things we'll consider. Keep in mind, though, Tanya, not every opportunity out there is a Wheaton opportunity. We're not going to do anything that sacrifices the integrity of our model. And we're very cautious to continue to add a creative growth. So just keep those things in mind.

Tonya, I think it's just worth highlighting. And you can look at two very, very real examples here just recently. Artemis at Blackwater and how we've supported them through the startup. I think if you ask the team at Artemis, they'd be very happy with their Wheaton relationship in terms of how we've stepped in to sort of adjust and add a bit of value to the stream at a timely basis for them as they're turning on the switches there. And so I think, you know, that example of being supportive through the startup process has caught a lot of people's eyes. And then I would go to the Montage deal on Kone. And, you know, the fact that that deal was structured where we supply the bulk of the capital in terms of getting that project up and running and They're going to turn the switches on on that mine and have no project debt and be producing 300,000 ounces a year to their credit. Those two transactions have really caught the eye of a lot of other developers in this space. Let's look at Wheaton taking a larger role in terms of how we finance these projects into production on a go-forward basis. We're always happy to invest into high-margin, high-quality assets. They are out there.

What about, Randy, maybe the base metal companies, given the volatility in some of those commodities, the high gold price for them in terms of crystallizing some value? on maybe some of their precious metal component to their assets. Has that increased? Have you seen more come to the table?

Yeah, there's a lot more discussion about it. I just haven't seen a lot of the base metal projects commit into going into construction going forward. I think they're waiting for a bit better copper price. It's mostly in the copper space that we're talking. We don't see a lot in the lead-zinc space. But in the copper space, they just want to see a bit stronger. Lots of predictions for stronger copper prices, but unfortunately with some of the de-globalization efforts around the world, it's having an impact on demand and therefore pricing in copper. We just haven't seen people making the commitments in terms of going into construction. I think they want to see a stronger market for copper before they make that decision. So the talks are ongoing, but they're nowhere near as advanced as what we're seeing in the precious metal space, in the gold space specifically.

I will add one thing, Kenny. I'd say of the split of opportunities we're looking at, approximately half would be as precious metals as a byproduct from these polymetallic acids.

Okay. And you said you were up to like 20-ish or so? Is that what I heard?

We're somewhere around 15 to 17 in that range, but it changes every day.

Yeah, for sure. And then I guess the last one I would have to add is just ask is on corporate transactions. How do you view that in your mix?

Yeah, I would just say that as long as we've got 15 to 20 assets in front of us looking at it, our preference is to go down that path. You know, we've... We've been at this business now for over 20 years, and I think a good old Wheaton stream has a lot of benefits, a lot of strength in terms of how it's structured, the security and stuff. And as soon as you start looking at corporate transactions, what you're doing is acquiring someone else's challenges. And what we've seen is a lot of people will give up weaknesses in terms of structure or how a deal is structured. is put together to try and get their foot in the door. And that means it just doesn't have the same strengths. And we've seen lots of evidence of that lately in terms of companies that are challenged because they gave up structural weaknesses and now they're paying the penalty for that. And so it's... We like good old wheat and streams. That doesn't mean we don't look at other streams. We have acquired portfolios of assets. Two years ago, we bought a bunch of stuff from Orion, a bunch of assets from Orion. They were existing streams. They were priced accordingly. If they'd had good structure, they're probably worth a bit more, right? So it is something that we're pretty sensitive to. And our preference is to put our own deals in place, and we still see a lot of appetite on that front.

I'll tell you, I'll just add one thing. We do keep our finger on the pulse. So we're always modeling a lot of these junior companies, the ones that we think have or could create value for us down the road. But as Randy said, as long as we continue to be able to acquire assets at net asset value or less streams, that's the route we'll take.

Okay, great. Thank you, and congrats on a good start to the year.

Thanks, Tanya. Thank you, Tanya.

Your next question is from Derek Ma from TD Cowen. Please go ahead.

Thank you very much. Picking up on your comments on HUD-B, we've talked in the past about levels of royalties which could potentially overburden any one individual asset. How do you think about royalty burden or leverage more holistically from a corporate level of your partners, and is that something that concerns you?

Yes, go ahead. In terms of

From our perspective, Derek, we try to not take too much of the economics of any specific asset. A lot of the older contracts, when some of the precious metals were much less important, they did have some higher levels of precious metal streams. But if you see everything we've done of late, we try to stay well under a reasonable amount such that even if commodity prices drop 20%, 30%, 40%, we are not overburdening the assets such that it has to shut down or make some significant changes. So we're very cautious as to what we do here in this environment.

What is the reasonable amount of economics in terms of one individual asset?

Optimally, we'd like to stay under 20-25%.

Yeah, Derek, every project is different in terms of its own operating margins, right? So that's one of the things that we always have to stay on top of. It's why Wes and the operations our partners are doing right we we really do put a focus though on first and second quartile assets because that's why you know it delivers healthy margins not only for us but I think most importantly for our operating partners if our operating partners aren't healthy we're not and so so we're constantly on the pulse of that you know I would say that one of the things that makes a little bit unique in that front is that we do manage our portfolio and we don't just buy things and stick them on the shelf and wait them out. There's a life, there's a time in mines when streams make a lot of sense as a competitive source of capital to help run that. But as a mine matures, it may get a little bit too much of a burden and we're not scared to crystallize. We have in the past and I guarantee we will again in the future where we look for ways to to to you know back out of minds as they get a little bit more tired a little bit more expensive and keep make sure that we focus on keeping a nice tight clean profitable portfolio of assets in our company and i think that's a differentiating factor between us and our peers is that you know we really do focus on we're not we're not here to just sort of take a scattergun lottery approach of just adding assets and and trying to cover the world with it we want a a nice, tight, concise, profitable group of assets that we focus on. And so we're constantly managing our existing portfolio, not just adding to it.

If I'll add one more thing, Derek, I'll say if you look at our contract structures, they are very thoughtful structures. They typically start with higher streams when they've got higher grades. And as the grades drop off, the streams drop off. And that's all factored into the original valuation, and it's all based on threshold levels being met, et cetera. So we ensure that we're not overburdening the asset throughout its existing life.

It's so important. If our partners aren't profitable, we're not profitable. So we need to do everything we can to stay on top of that and make sure that we work that way. And I really think that's the difference of a streaming partnership versus some of the traditional space in this business.

I appreciate that. And maybe that's a good segue to my next question, which is on amendments to existing PIMPAs. Appreciating every situation is different, but broadly speaking, what kind of considerations is Wieden looking for when you start these negotiations with your partners? And when does amendments make sense for Wieden?

Sure.

Listen, we're only looking to change contracts structurally when it makes sense, as you said. And when does that make sense? It usually makes sense towards the latter end when the mines really mature, the grades come off and depends on what commodity price cycle you're in. So we're not out there looking to make amendments. Our partners typically come to us and say, listen, this is what we're seeing. We want to make an expansion or we want to continue to drill this project, but it doesn't make sense because the project is taking too much of the economics. Usually we'll come in, we'll look at ways to actually expand our overall portfolio through other streams, other opportunities that they may have. change the areas of interest. So where we give up value, we always get value. We're not just giving up amendments to our shareholders' detriments.

I'd say, Derek, as well, that's one of the reasons that we monitor very closely the health of all of our assets, so that we're aware of how these streams are doing and at what point and what things are actually negotiable. But as Arthur said, really, it is we need to get value back for any of those amendments that we do.

Great, thank you for that. Thanks, Derek. Your next question is from Brian McArthur from Raymond James.

Please go ahead. Good morning, and thank you for taking my question. I kind of want to go back to what Tanya was talking about. When you talk about these $500 to $1 billion deals now, are they what I would call the global deals where it's $1 billion of streaming, or are they more 500 of streams and say 300 of equity and other things. And just in general, if you can maybe comment as you do more of these full funding packages, what sort of ratios you look for in the stream component of the deal on a full value basis? Because obviously, you know, the streaming model is very unique and nice and tends to get a better multiple than maybe equity does if you're buying that in a deal.

Sure. After you answer the question, Brian, take me again. I would say that the streams are our core business. So when we're talking $500 to $1 billion in streams or royalties, that's the primary contract. That's not looking at revolvers or working capital facilities or equity or debt. That's just what we're looking at from a streaming perspective. There are opportunities, obviously, where we will come in and provide a big chunk of the overall funding. But we typically like to see the counterparty with some skin in the game. To answer your second question, is there a ratio? I would say... If we're going to put up anything that's not a stream, at least 80 plus percent of that value has to be a stream.

Great. Thanks very much. Very clear. Brian.

And with that, thank you everyone for your time today. Q1 set a strong foundation for what we expect will be another strong year as Wheaton's portfolio of high quality assets, sector leading growth profile and commitment to sustainability provides our stakeholders with a solid outlook for the future. In times of economic uncertainty, gold is viewed as a reliable store of value, and our Q1 results demonstrate why we believe Wheaton offers one of the best lower-risk opportunities for investors seeking exposure to gold and precious metals.

We look forward to speaking with you all again. Thank you.

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