OSISKO REPORTS Q2 2022 RESULTS Record cash margin of $47.8 million from royalties and streams Operating cash flows from the royalties and streams segment of $35.0 million
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OSISKO REPORTS Q2 2022 RESULTS
Record cash margin of $47.8 million from royalties and streams
Operating cash flows from the royalties and streams segment of $35.0 million
Montréal, August 9, 2022 – Osisko Gold Royalties Ltd (the “Corporation” or “Osisko”) (OR: TSX &
NYSE) today announced its consolidated financial results for the second quarter of 2022. Amounts
presented are in Canadian dollars, except where otherwise noted.
Q2 2022 Financial Highlights
• 22,243 GEOs1 earned (Q2 2021 – 20,178 GEOs);
• Consolidated revenues of $64.0 million (Q2 2021 – $57.9 million);
o Revenues from the royalties and streams segment 2 of $ 51.5 million ( Q2 2021 –
$57.2 million, including $7.3 million from offtakes);
o Revenues from the mining exploration and development segment 3 (i.e. Osisko
Development Corp.) of $12.4 million (Q2 2021 – $0.7 million);
• Consolidated cash flows from operating activities of ($0.2 million) (Q2 2021 – $30.9 million);
o O perating cash flows from the royalties and streams segment of $35.0 million (Q2 2021
– $37.3 million);
o Operating cash flows from the mining exploration and development segment of
($35.2) million (Q2 2021 – ($6.4) million);
• Cash margin4 of 93% from royalties and streams (Q2 2021 – 94%);
• Consolidated net earnings attributable to Osisko’s shareholders of $17.2 million, or $ 0.09 per
share (Q2 2021 – net loss of $14.8 million or $0.09 per basic share);
• Consolidated adjusted loss4 of $4.7 million, or $0.03 per basic share ( Q2 2021 – net earnings
$20.2 million, $0.12 per basic share);
o Adjusted earnings from the royalty and stream segment of $25.7 million, or $ 0.14 per
basic share (Q2 2021 – $23.9 million, or $0.14 per basic share); and
o Adjusted loss from the mining exploration and development segment of $30.4 million, or
$0.16 per basic share (Q2 2021 – $3.7 million, or $0.02 per basic share).
Sandeep Singh, President and CEO of Osisko commented: “We benefited from record GEO deliveries
and cash margins in Q2 despite two core assets not being at their full run rates, and we expect deliveries
to continue to climb steadily in the second half of the year. The markets have become increasingly
volatile, but we believe the investment thesis for Osisko has never been stronger with growing cash
flows, meaningful diversification, exposure to tier-1 jurisdictions, and countless catalysts in the portfolio.
And as evident with our Q2 results, our royalty and streaming business affords protection from a highly
inflationary mining environment.”
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Financial Highlights by Operating Segment
(in thousands of dollars, except per share amounts)
As a result of the interest held (44.1% as of June 30, 2022) and based on other facts and circumstances,
the Corporation consolidates the assets, liabilities, results of operations and cash flows of the activities
of Osisko Development Corp. (“Osisko Development”) and its subsidiaries. The table below provides
some financial highlights per operating segment. More information per operating segment can be found
in the consolidated financial statements and management’s discussion and analysis for the three and
six months ended June 30, 2022.
(i) Osisko Gold Royalties Ltd and its subsidiaries, excluding Osisko Development Corp. and its subsidiaries. Represents the royal ty, stream and other
interests segment.
(ii) Osisko Development Corp. and its subsidiaries. Represents the exploration, evaluation and development of mining projects segm ent.
(iii) Cash margin is a non-IFRS financial performance measure for the royalties and streams segment which has no standard definition under IFRS. It is
calculated by deducting the cost of sales (excluding depletion) from the revenues. Please refer to the Non-IFRS Financial Performance Measures section
of the MD&A for the three and six months ended June 30, 2022 or the Notes section at the end of this press release.
(iv) Adjusted earnings (loss) and adjusted earnings (loss) per basic share are non -IFRS financial performance measures which have no standard definition
under IFRS. Refer to the non-IFRS measures provided under the Non-IFRS Financial Performance Measures section of the Corporation’s MD&A for the
three and six months ended June 30, 2022 or the Notes section at the end of this press release.
(v) Consolidated results are net of the intersegment transactions. Refer to the S egment Disclosure section of the Corporation’s MD&A for the three and six
months ended June 30, 2022.
For the three and six months ended June 30,
Osisko Gold Royalties (i) Osisko Development (ii) Consolidated (v)
2022 2021 2022 2021 2022 2021
$ $ $ $ $ $
Cash (June 30, 2022 and Dec. 31, 2021) 312,981 82,291 136,302 33,407 449,283 115,698
Three months ended June 30,
Revenues 51,545 57,246 12,862 775 63,959 57,941
Cash margin (iii) 47,789 47,150 n/a n/a 47,789 47,150
Gross profit 35,938 35,713 653 - 36,591 35,713
Operating expenses
(G&A, bus. dev and exploration) (6,200) (6,483) (10,079) (4,649) (16,279) (11,132)
Mining operating expenses - - (20,602) - (20,602) -
Net earnings (loss) 18,059 16,341 (1,487) (41,404) 16,572 (25,063)
Net earnings (loss) attributable to Osisko’s
shareholders 18,059 16,341 (899) (31,100) 17,160 (14,759)
Net earnings (loss) per share attributable to
Osisko’s shareholders
0.10
0.10
(0.01)
(0.19)
0.09
(0.09)
Adjusted net earnings (loss) (iv) 25,716 23,877 (30,375) (3,727) (4,659) 20,150
Adjusted net earnings (loss) per basic share (iv) 0.14 0.14 (0.16) (0.02) (0.03) 0.12
Cash flows from operating activities
Before working capital items 40,870 39,026 (24,913) (3,708) 15,957 35,318
Working capital items (5,905) (1,685) (10,276) (2,716) (16,181) (4,401)
After working capital items 34,965 37,341 (35,189) (6,424) (224) 30,917
Cash flows from investing activities 2,573 (42,377) (97,759) (47,464) (95,186) (89,841)
Cash flows from financing activities (125,705) (3,542) 210,225 (1,718) 84,520 (5,260)
Six months ended June 30,
Revenues 102,234 124,169 22,029 775 123,357 124,864
Cash margin (iii) 95,297 93,676 n/a n/a 95,297 93,676
Gross profit 72,148 70,312 653 - 72,801 70,312
Operating expenses
(G&A, bus. dev and exploration) (12,457) (12,511) (18,007) (9,851) (30,464) (22,362)
Mining operating expenses - (35,848) -
Net earnings (loss) 34,863 29,805 (23,820) (45,105) 11,043 (15,300)
Net earnings (loss) attributable to Osisko’s
shareholders 34,863 29,805 (17,377) (33,970) 17,486 (4,165)
Net earnings (loss) per share attributable to
Osisko’s shareholders
0.20
0.18
(0.10)
(0.20)
0.10
(0.02)
Adjusted net earnings (loss) (iv) 50,559 47,316 (50,982) (9,238) (423) 38,078
Adjusted net earnings (loss) per basic share (iv) 0.29 0.28 (0.29) (0.06) (0.00) 0.23
Cash flows from operating activities
Before working capital items 80,762 78,565 (42,182) (1,285) 38,580 71,570
Working capital items (5,290) (4,487) (9,904) (14,842) (15,194) (19,329)
After working capital items 75,472 74,078 (52,086) (16,127) 23,386 52,241
Cash flows from investing activities (13,013) (56,158) (94,445) (69,172) (107,458) (119,620)
Cash flows from financing activities 159,823 (11,053) 247,362 33,895 407,185 22,842
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Other Highlights
• Publication of the inaugural Asset Handbook and the second edition of the environmental, social
and governance (“ESG”) report, Growing Responsibly;
• Repayment in full of the outstanding revolving credit facility for $113.1 million;
• Osisko Development completed the acquisition of Tintic Consolidated Metals LLC (“TCM”) and
related financings, which resulted in the Corporation’s equity ownership in Osisko Development
reducing from 70.1% to 44.1%;
• Osisko Bermuda Limited (“OBL”) entered into a binding agreement with TCM with respect to the
previously announced metals stream (the “Tintic Stream”) on the Trixie test mine (the “Tri xie
Mine”), as well as mineral claims covering more than 17,000 acres in Central Utah’s historic
Tintic Mining District (the “Tintic Property”), for US$20.0 million in exchange for 2.5% of all metals
produced and a transfer price of 25% of the spot prices;
• Quarterly dividend of $0.055 per common share paid on July 15, 2022 to shareholders of record
as of the close of business on June 30, 2022;
• In July 2022, the Corporation purchased for cancellation a total of 659,520 common shares for
$8.3 million (average acquisition price per share of $12.65) under its 2022 NCIB program; and
• Declaration of a quarterly dividend of $0.055 per common share payable on October 14, 2022
to shareholders of record as of the close of business on September 30, 2022.
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Q2 2022 Results Conference Call Details
Conference Call: Wednesday, August 10th, 2022 at 10:00 am ET
Dial-in Numbers: North American Toll-Free: 1 (888) 396 8049
Local and International: 1 (416) 764 8646
Conference ID: 28077702
Replay (available until August 17th at
11:59 pm ET):
North American Toll-Free: 1 (877) 674 7070
Local and International: 1 (416) 764 8692
Playback passcode: 077702#
Replay also available on our website at www.osiskogr.com
Qualified Person
The scientific and technical content of this news release has been reviewed and approved by Guy
Desharnais, Ph.D., P.Geo., Vice President, Project Evaluation at Osisko Gold Royalties Ltd, who is a
“qualified person” as defined by National Instrument 43- 101 – Standards of Disclosure for Mineral
Projects (“NI 43-101”).
About Osisko Gold Royalties Ltd
Osisko Gold Royalties Ltd is an intermediate precious metal royalty company which holds a North
American focused portfolio of over 165 royalties, streams and precious metal offtakes. Osisko’s portfolio
is anchored by its cornerstone asset, a 5% net smelter return royalty on the Canadian Malartic mine,
which is the largest gold mine in Canada.
Osisko’s head office is located at 1100 Avenue des Canadiens -de-Montréal, Suite 300, Montréal,
Québec, H3B 2S2.
For further information, please contact Osisko Gold Royalties Ltd:
Heather Taylor
Vice President, Investor Relations
Tel. (514) 940-0670 x105
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Notes:
(1) Gold Equivalent Ounces
GEOs are calculated on a quarterly basis and include royalties, streams and offtakes. Silver earned from royalty and stream agreements
are converted to gold equivalent ounces by multiplying the silver ounces earned by the average silver price for the period and dividing by
the average gold price for the period. Diamonds, other metals and cash royalties are converted into gold equivalent ounces by dividing
the associated revenue earned by the average gold price for the period. Offtake agreements are converted using the financial settlement
equivalent divided by the average gold price for the period.
Average Metal Prices and Exchange Rate
Three months ended
June 30,
Six months ended
June 30,
2022 2021 2022 2021
Gold(i) $1,871 $1,816 $1,874 $1,805
Silver(ii) $23 $27 $23 $26
Exchange rate (US$/Can$)(iii) 1.2768 1.2282 1.2715 1.2471
(i) The London Bullion Market Association’s pm price in U.S. dollars.
(ii) The London Bullion Market Association’s price in U.S. dollars.
(iii) Bank of Canada daily rate.
(2) T he royalties and streams segment refers to the royalty, stream and other interests segment, which corresponds to the activities of Osisko
Gold Royalties Ltd and its subsidiaries, excluding Osisko Development Corp. and its subsidiaries.
(3) T he mining exploration and development segment refers to the mining exploration, evaluation and development segment, which
corresponds to the activities of Osisko Development Corp. and its subsidiaries.
(4) Non-IFRS Measures
The Corporation has included certain performance measures in this press release that do not have any standardized meaning prescribed
by International Financial Reporting Standards (IFRS) including (i) cash margin ( in dollars and in percentage) for the royalties and
streams segment, (ii) adjusted earnings (loss) and (iii) adjusted earnings (loss) per share. The presentation of these non-IFRS measures
is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performanc e
prepared in accordance with IFRS. These measures are not necessarily indicative of operating profit or cash flow from operations as
determined under IFRS. As Osisko’s operations are primarily focused on precious metals, the Corporation presents cash margins and
adjusted earnings as it believes that certain investors use this information, together with measures determined in accordance with IFRS, to
evaluate the Corporation’s performance in comparison to other companies in the precious metals mining industry who present results on
a similar basis. However, other companies may calculate these non-IFRS measures differently.
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Cash Margin (in dollars and in percentage of revenues)
Cash margin (in dollars) represents revenues from the royalties and streams segment less cost of sales (excluding depletion). Cash
margin (in percentage of revenues) represents the cash margin (in dollars) divided by revenues from the royalties and streams segment.
Three months ended
June 30,
Six months ended
June,
2022 2021 2022 2021
$ $ $ $
Royalty and stream interests
Total Revenues 63,959 57,941 123,357 124,864
Less: Revenues from mining activities (Osisko Development) (12,414) (695) (21,123) (695)
Less: Revenues from offtake interests - (7,339) - (25,265)
Revenues from royalty and stream interests 51,545 49,907 102,234 98,904
Total Cost of sales (15,318) (10,791) (26,480) (31,188)
Less: Cost of sales from mining activities (Osisko Development) 11,562 695 19,543 695
Less: Cost of sales from offtake interests - 7,104 - 24,343
Cost of sales of royalty and stream interests (3,756) (2,992) (6,937) (6,150)
Revenues from royalty and stream interests 51,545 49,907 102,234 98,904
Less: Cost of sales of royalty and stream interests (3,756) (2,992) (6,937) (6,150)
Cash margin (in dollars) - royalty and stream interests 47,789 46,915 95,297 92,754
Cash margin (in percentage of revenues) - royalty and stream interests 93% 94% 93% 94%
Offtake interests
Revenues from offtake interests - 7,339 - 25,265
Less: Cost of sales of offtake interests - (7,104) - (24,343)
Cash margin (in dollars) - 235 - 922
Cash margin (in percentage of revenues) - 3% - 4%
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Adjusted earnings (loss) and adjusted earnings (loss) per basic share
Adjusted earnings (loss) is defined as: net earnings (loss) adjusted for certain items: foreign exchange gain (loss), impairment of assets
(including impairment on financial assets and investments in associates), gains (losses) on disposal of exploration and evaluation assets,
unrealized gain (loss) on investments, share of loss of associates, deferred premium income on flow-through shares, deferred income tax
expense (recovery), transaction costs and other items such as non-cash gains (losses).
Adjusted earnings (loss) per basic share is obtained from the adjusted earnings (loss) divided by the weighted average number of common
shares outstanding for the period.
(i) Osisko Gold Royalties Ltd and its subsidiaries, excluding Osisko Development Corp. and its subsidiaries. Represents the royalt y, stream and
other interests segment.
(ii) Osisko Development Corp. and its subsidiaries. Represents the mining exploration, evaluation and development segment.
For the three months ended June 30,
2022 2021
Osisko Gold
Royalties (i)
Osisko
Development (ii) Consolidated
Osisko Gold
Royalties (i)
Osisko
Development (ii) Consolidated
(in thousands of dollars, except
per share amounts)
$ $ $ $ $ $
Net earnings (loss) 18,059 (1,487) 16,572 16,341 (41,404) (25,063)
Adjustments:
Impairment of assets 384 - 384 - 40,479 40,479
Foreign exchange (gain) loss (7,593) (1,563) (9,156) (169) 791 622
Unrealized loss (gain) on investments 5,574 (11,697) (6,123) 1,553 13 1,566
Variation of fair value of derivative
instruments
-
(19,381)
(19,381)
-
-
-
Share of loss of associates 1,078 141 1,219 1,111 750 1,861
Deferred premium income on flow-through
shares - (573) (573) - (2,798) (2,798)
Transaction cost – Tintic - 2,664 2,664
Deferred income tax expense (recovery) 8,214 1,521 9,735 5,041 (1,558) 3,483
Adjusted earnings (loss) 25,716 (30,375) (4,659) 23,877 (3,727) 20,150
Weighted average number of
common shares outstanding (000’s) 185,316 185,316 185,316 167,895 167,895 167,895
Adjusted earnings (loss) per basic share 0.14 (0.16) (0.03) 0.14 (0.02) 0.12
For the six months ended June 30,
2022 2021
Osisko Gold
Royalties (i)
Osisko
Development (ii) Consolidated
Osisko Gold
Royalties (i)
Osisko
Development (ii) Consolidated
(in thousands of dollars, except
per share amounts)
$ $ $ $ $ $
Net earnings (loss) 34,863 (23,820) 11,043 29,805 (45,105) (15,300)
Adjustments:
Impairment of assets 904 - 904 4,400 40,479 44,879
Foreign exchange loss (gain) (8,469) (2,087) (10,556) (140) 1,535 1,395
Unrealized (gain) loss on investments 11,414 (11,469) (55) 2,942 (1,297) 1,645
Variation of fair value of derivative
instruments
-
(19,381)
(19,381)
-
-
-
Share of (earnings) loss of associates (1,526) 472 (1,054) 736 1,157 1,893
Deferred premium income on flow-through
shares - (914) (914) - (3,267) (3,267)
Transaction cost – Tintic - 4,727 4,727
Deferred income tax expense (recovery) 13,373 1,490 14,863 9,573 (2,740) 6,833
Adjusted earnings (loss) 50,559 (50,982) (423) 47,316 (9,238) 38,078
Weighted average number of
common shares outstanding (000’s) 176,182 176,182 176,182 167,696 167,696 167,696
Adjusted earnings (loss) per basic share 0.29 (0.29) 0.00 0.28 (0.06) 0.23
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Forward-looking Statements
Certain statements contained in this press release may be deemed "forward-looking statements" within the meaning of the
United States Private Securities Litigation Reform Act of 1995 and “forward- looking information” within the meaning of
applicable Canadi an securities legislation. All statements in this press release, forward- looking statements are statements
other than statements of historical fact, that address, without limitation, future events, production estimates of Osisko’s assets
(including increase of production), timely developments of mining properties over which Osisko has royalties, streams, offtakes
and investments, management’s expectations regarding Osisko’s growth, results of operations, estimated future revenues,
production costs, carrying value of assets, ability to continue to pay dividend, requirements for additional capital, business
prospects and opportunities future demand for and fluctuation of prices of commodities (including outlook on gold, silver,
diamonds, other commodities) cur rency markets and general market conditions . In addition, statements and estimates
(including data in tables) relating to mineral reserves and resources and gold equivalent ounces are forward-looking
statements, as they involve implied assessment, based on certain estimates and assumptions, and no assurance can be given
that the estimates will be realized. Forward-looking statements are statements that are not historical facts and are generally,
but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential",
"scheduled" and similar expressions or variations (including negative variations), or that events or conditions "will", "woul d",
"may", "could" or "should" occur. Forward-looking statements are subject to known and unknown risks, uncertainties and other
factors, most of which are beyond the control of Osisko, and actual results may accordingly differ materially from those in
forward-looking statements. Such risk factors include, without limitation: fluctuations in the prices of the commodities that drive
royalties, streams, offtakes and investments held by Osisko; fluctuations in the value of the Canadian dollar relative to the U.S.
dollar; regulatory changes by national and local governments, including permitting and licensing regimes and taxation policies;
regulations and political or economic developments in any of the countries where properties in which Osisko holds a royalty,
stream or other interest are located or through which they are held; risks related to the operators of the properties in which
Osisko holds a royalty, stream or other interests; timely development, permitting, construction, commencement of production,
ramp-up (including operating and technical challenges) on any of the properties in which Osisko holds a royalty, stream or
other interest; rate and timing of production differences from resource estimates or production forecasts by operators of
properties in which Osisko holds a royalty, stream or other interest; the unfavorable outcome of any challenges or litigation
relating title, permit or license with respect to any of the properties in which Osisko holds a royalty, stream or other interests or
to Osisko’s right thereon; differences in rate and timing of production from resource estimates or production forecasts by
operators of properties in which Osisko holds a royalty, stream or other interest, including conversion from resources to
reserves and ability to replace resources; business opportunities that become available to, or are pursued by Osisko; continued
availability of capital and financing and general economic, market or business conditions; risks and hazards associated with
the business of exploring, development and mining on any of the properties in w hich Osisko holds a royalty, stream or other
interest, including, but not limited to unusual or unexpected geological and metallurgical conditions, slope failures or cave-ins,
flooding and other natural disasters or civil unrest or other uninsured risks, the integration of acquired assets and the responses
of relevant governments to the COVID-19 outbreak and the effectiveness of such response and the potential impact of COVID-
19 on Osisko’s business, operations and financial condition. The forward- looking statements contained in this press release
are based upon assumptions management believes to be reasonable, including, without limitation: the ongoing operation of
the properties in which Osisko holds a royalty, stream or other interest by the owners or operators of such properties in a
manner consistent with past practice and with public disclosure (including forecast of production); the accuracy of public
statements and disclosures made by the owners or operators of such underlying properties (including ex pectations for the
development of underlying properties that are not yet in production); no adverse development in respect of any significant
property in which Osisko holds a royalty, stream or other interest; that statements and estimates relating to mineral reserves
and resources by owners and operators of the properties in which Osisko holds a royalty, stream or other interest are accurate;
the Corporation’s ongoing income and assets relating to determination of its PFIC status; integration of acquired assets; and
the absence of any other factors that could cause actions, events or results to differ from those anticipated, estimated or
intended.
For additional information on risks, uncertainties and assumptions, please refer to the most recent Annual Information Form of
Osisko filed on SEDAR at www.sedar.com and EDGAR at www.sec.gov which also provides additional general assumptions
in connection with these statements. Osisko cautions that the foregoing list of risk and uncertainties is not exhaustive. Investors
and others should carefully consider the above factors as well as the uncertainties they represent and the risk they entail.
Osisko believes that the assumptions reflected in those forward-looking statements are reasonable, but no assurance can be
given that these expectations will prove to be accurate as actual results and prospective events could materially differ from
those anticipated such the forward looking statements and such forward-looking statements included in this press release are
not guarantee of future performance and should not be unduly relied upon. These statements speak only as of the date of this
press release. Osisko undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise, other than as required by applicable law.