OSISKO REPORTS Q2 2023 RESULTS Strong cash margin of $56.2 million and operating cash flows of $47.4 million
1
OSISKO REPORTS Q2 2023 RESULTS
Strong cash margin of $56.2 million
and operating cash flows of $47.4 million
Montréal, August 9, 2023 – Osisko Gold Royalties Ltd (the “Corporation” or “Osisko”) (OR: TSX &
NYSE) today announced its consolidated financial results for the second quarter of 2023. Amounts
presented are in Canadian dollars, except where otherwise noted.
Highlights – Second Quarter of 2023
• 24,645 GEOs1 earned, an increase of 11% over the second quarter of 2022 (Q2 2022 – 22,243);
• Revenues from royalties and streams of $60.5 million (Q2 2022 - $51.5 million);
• Cash flows generated by operating activities2 of $47.4 million (Q2 2022 - $35.0 million);
• Cash margin3 of $56.2 million or 93% (Q2 2022 – $47.8 million or 93%);
• Net earnings2 of $18.0 million, $0.10 per basic share (Q2 2022 – $18.1 million, $0.10 per basic
share);
• Adjusted earnings3 of $32.6 million, $0.18 per basic share (Q2 2022 – $25.7 million, $0.14 per
basic share);
• Publication of the 2023 Asset Handbook and third edition of the Company’s sustainability report,
Growing Responsibly;
• Closing of the CSA silver and copper streams by Osisko Bermuda Limited for US$150.0 million;
• Amendment of the Gibraltar silver stream for US$10.25 million; and
• Declaration of a quarterly dividend of $0.06 per common share, an increase of 9% over the
previous quarter, paid on July 14, 2023 to shareholders of record as of the close of business on
June 30, 2023.
Paul Martin, Interim CEO of Osisko commented: “Despite challenges faced by our operating partners
who were temporarily impacted by the wildfires in northern Ontario and Québec, Osisko delivered a
solid second quarter. As we head into the second half of the year, we are well positioned to meet our
2023 guidance. Osisko remained very active on the corporate development front in the second quarter,
having closed the CSA transaction, including the full copper stream which comes into effect in June
2024, and the announced increase to our silver stream at Taseko’s Gibraltar mine. Following the quarter,
the Company announced the acquisition of copper and gold royalties at Hot Chili’s Costa Fuego project”.
Subsequent to June 30, 2023
• Closing of the gold and copper royalty investment in relation to the Costa Fuego Project; and
• Declaration of a quarterly dividend of $0.06 per common share payable on October 16, 2023 to
shareholders of record as of the close of business on September 29, 2023.
2
Q2 2023 RESULTS CONFERENCE CALL AND WEBCAST DETAILS
Osisko provides notice of its second quarter 2023 results conference call and webcast details.
Results Release: Wednesday, August 9th, 2023 after market close
Conference Call: Thursday, August 10th, 2023 at 10:00 am ET
Dial-in Numbers (option 1): North American Toll-Free: 1 (888) 886 7786
Local and International: 1 (416) 764 8658
Conference ID: 63806714
Webcast link (option 2): https://viavid.webcasts.com/starthere.jsp?ei=1627532&tp_key=ca8800
f4ff
Replay (available until
Sunday, September 10th at
11:59 pm ET):
North American Toll-Free: 1 (877) 674 7070
Local and International: 1 (416) 764 8692
Playback Passcode: 806714#
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 180 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,
one of Canada’s largest gold mines.
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:
Grant Moenting Heather Taylor
Vice President, Capital Markets Vice President, Sustainability and Communications
Tel: (514) 940-0670 x116 Tel: (514) 940-0670 x105
Email: [email protected] Email: [email protected]
3
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.
Average Metal Prices and Exchange Rate
Three months ended
June 30,
Six months ended
June 30,
2023 2022 2023 2022
Gold(i) $1,976 $1,871 $1,932 $1,874
Silver(ii) $24.13 $22.60 $23.31 $23.32
Exchange rate (US$/Can$)(iii) 1.3428 1.2768 1.3477 1.2715
(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) From continuing operations
(3) 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), (ii) adjusted earnings
and (iii) adjusted earnings 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 performance 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.
Cash Margin (in dollars and in percentage of revenues)
Cash margin (in dollars) represents revenues from continuing operations less cost of sales (excluding depletion). Cash margin (in
percentage of revenues) represents the cash margin (in dollars) divided by revenues from continuing operations.
Three months ended
June 30,
Six months ended
June 30,
2023 2022 2023 2022
$ $ $ $
Royalty interests
Revenues 39,323 34,583 78,501 69,572
Less: cost of sales (excluding depletion) (205) (188) (340) (282)
Cash margin (in dollars) 39,118 34,395 78,161 69,290
Depletion (5,610) (6,202) (12,458) (13,057)
Gross profit 33,508 28,193 65,703 56,233
Stream interests
Revenues 21,177 16,962 41,586 32,662
Less: cost of sales (excluding depletion) (4,055) (3,568) (7,961) (6,655)
Cash margin (in dollars) 17,122 13,394 33,625 26,007
Depletion (7,357) (5,649) (14,004) (10,092)
Gross profit 9,765 7,745 19,621 15,915
Royalty and stream interests
Total cash margin (in dollars) 56,240 47,789 111,786 95,297
Divided by: total revenues 60,500 51,545 120,087 102,234
Cash margin (in percentage of revenues) 93.0% 92.7% 93.1% 93.2%
Total – Gross profit 43,273 35,938 85,324 72,148
4
Adjusted earnings and adjusted earnings per basic share
Adjusted earnings 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 assets, unrealized gain (loss) on
investments, share of income (loss) of associates, deferred income tax expense (recovery) , transaction costs and other items such as
non-cash gains (losses).
Adjusted earnings per basic share is obtained from the adjusted earnings divided by the weighted average number of common shares
outstanding for the period.
Three months ended
June 30,
Six months ended
June 30,
2023 2022 2023 2022
(in thousands of dollars, except per share
amounts)
$ $ $ $
Net earnings from continuing operations 17,961 18,059 38,809 34,863
Adjustments:
Impairment of royalty interests 6,629 - 6,629 -
Expected credit loss on other
investments 19,860 384 20,131 904
Foreign exchange loss (gain) 9 (7,593) 25 (8,469)
Unrealized net loss on investments 4,066 5,574 1,969 11,414
Share of (income) loss of associates (19,167) 1,078 (13,022) (1,526)
Deferred income tax expense 3,270 8,214 10,730 13,373
Adjusted earnings 32,628 25,716 65,271 50,559
Weighted average number of
common shares outstanding (000’s) 185,302 185,316 184,990 176,182
Adjusted earnings per basic share 0.18 0.14 0.35 0.29
5
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, with out limitation, (i) with respect to properties in which Osisko holds a
royalty, stream or other interest; risks related to: (a) the operators of the properties, (b) timely development, permitting,
construction, commencement of production, ramp-up (including operating and technical challenges), (c) differences in rate and
timing of production from resource estimates or production forecasts by operators, (d) differences in conversion rate from
resources to reserves and ability to replace resources, (e) the unfavorable outcome of any challenges or litigation relating title,
permit or license, (f) hazards and uncertainty associated with the business of exploring, development and mining including, but
not limited to unusual or unexpected geological and metallurgi cal conditions, slope failures or cave -ins, flooding and other
natural disasters or civil unrest or other uninsured risks; with respect to external factors: (a) fluctuations in the prices of the
commodities that drive royalties, streams, offtakes and investments held by Osisko, (b) fluctuations in the value of the Canadian
dollar relative to the U.S. dollar, (c) regulatory changes by national and local governments, including permitting and licens ing
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, (d) continued availability of
capital and financing and general economic, market or business conditions, and (e) 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; with respect to internal factors: (a) business opportunities that may or not become available
to, or are pursued by Osisko or (b) the integration of acquired assets. The forward-looking statements contained in this press
release are based upon assumptions management believes to be reasonable, including, without limitation: the absence of
significant change in the Corporation’s ongoing income and assets relating to determination of its Passive Foreign Investment
Company ("PFIC”) status; the absence of any other factors that could cause actions, events or results to differ from those
anticipated, estimated or intended and, with respect to properties in which Osisko holds a royalty, stream or other interest, (i)
the ongoing operation of the properties by the owners or operators of such properties in a manner consistent with past practice
and with public disclosure (including forecast of production), (ii) the accuracy of public statements and disclosures made by the
owners or operators of such underlying properties (including expectations for the development of underlying properties that are
not yet in production), (iii) no adverse development in respect of any significant property, (iv) that statements and estimat es
relating to mineral reserves and resources by owners and operators are accurate and ( v) the implementation of an adequate
plan for integration of acquired assets.
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 w ell 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 r esults 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.
Osisko Gold Royalties Ltd
Consolidated Balance Sheets
As at June 30, 2023 and December 31, 2022
(Unaudited)
(tabular amounts expressed in thousands of Canadian dollars)
6
June 30, December 31,
2023 2022
$ $
Assets
Current assets
Cash 70,033 90,548
Short-term investments 3,732 -
Amounts receivable 5,505 11,700
Other assets 4,619 2,546
83,889 104,794
Non-current assets
Investments in associates 324,411 319,763
Other investments 116,108 73,504
Royalty, stream and other interests 1,546,181 1,378,253
Goodwill 111,204 111,204
Other assets 9,335 8,783
2,191,128 1,996,301
Liabilities
Current liabilities
Accounts payable and accrued liabilities 6,626 6,825
Dividends payable 11,103 10,121
Lease liabilities 1,112 921
18,841 17,867
Non-current liabilities
Lease liabilities 7,420 6,701
Long-term debt 319,650 147,950
Deferred income taxes 97,120 86,572
443,031 259,090
Equity
Share capital 2,092,786 2,076,070
Contributed surplus 76,029 77,295
Accumulated other comprehensive income 26,963 47,435
Deficit (447,681) (463,589)
1,748,097 1,737,211
2,191,128 1,996,301
Osisko Gold Royalties Ltd
Consolidated Statements of Income
For the three and six months ended June 30, 2023 and 2022
(Unaudited)
(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)
7
Three months ended
June 30,
Six months ended
June 30,
2023 2022 2023 2022
$ $ $ $
Revenues 60,500 51,545 120,087 102,234
Cost of sales (4,260) (3,756) (8,301) (6,937)
Depletion (12,967) (11,851) (26,462) (23,149)
Gross profit 43,273 35,938 85,324 72,148
Other operating expenses
General and administrative (7,308) (4,940) (13,517) (9,776)
Business development (1,297) (1,260) (2,793) (2,681)
Impairment of royalty interests (6,629) - (6,629) -
Operating income 28,039 29,738 62,385 59,691
Interest income 2,170 1,858 4,233 2,966
Finance costs (3,445) (5,543) (6,315) (11,469)
Foreign exchange (loss) gain (172) 7,711 (153) 8,529
Share of income (loss) of associates 19,167 (1,078) 13,022 1,526
Other losses, net (23,926) (5,958) (22,100) (12,318)
Earnings before income taxes 21,833 26,728 51,072 48,925
Income tax expense (3,872) (8,669) (12,263) (14,062)
Net earnings from continuing operations 17,961 18,059 38,809 34,863
Net loss from discontinued operations - (1,487) - (23,820)
Net earnings 17,961 16,572 38,809 11,043
Net earnings (loss) attributable to:
Osisko Gold Royalties Ltd’s shareholders 17,961 17,159 38,809 17,485
Non-controlling interests - (587) - (6,442)
Osisko Gold Royalties Ltd
Consolidated Statements of Cash Flows
For the three and six months ended June 30, 2023 and 2022
(Unaudited)
(tabular amounts expressed in thousands of Canadian dollars)
8
Three months ended
June 30,
Six months ended
June 30,
2023 2022 2023 2022
$ $ $ $
Operating activities
Net earnings from continuing operations 17,961 18,059 38,809 34,863
Adjustments for:
Share-based compensation 2,868 1,208 5,157 2,958
Depletion and amortization 13,271 12,112 27,025 23,685
Impairment of royalty interests 6,629 - 6,629 -
Expected credit losses of other investments 19,860 384 20,131 904
Finance costs 124 1,804 247 3,502
Share of (income) loss of associates (19,167) 1,078 (13,022) (1,526)
Net gain on acquisition of investments - (48) - (48)
Change in fair value of financial assets at fair value
through profit and loss 1,009 7,118 3,754 15,066
Net gain on dilution of investments - (1,544) (4,842) (3,604)
Loss on the deemed disposal of an associate 3,057 - 3,057 -
Foreign exchange loss (gain) 9 (7,593) 25 (8,469)
Deferred income tax expense 3,270 8,214 10,730 13,373
Other 323 78 236 58
Net cash flows provided by operating activities
before changes in non-cash working capital items 49,214 40,870 97,936 80,762
Changes in non-cash working capital items
(1,822) (5,905) (5,094) (5,290)
Net operating cash flows provided by continuing operations 47,392 34,965 92,842 75,472
Net operating cash flows used by discontinued operations - (35,189) - (52,086)
Net cash flows provided (used) by operating activities 47,392 (224) 92,842 23,386
Investing activities
Acquisitions of short-term investments (2,154) - (3,797) -
Acquisitions of investments (53,008) (384) (53,279) (6,680)
Proceeds on disposal of investments 6 2,960 6 2,960
Acquisitions of royalty and stream interests (212,762) - (212,762) (9,290)
Other (6) (3) (6) (3)
Net investing cash flows (used) provided by continuing
operations
(267,924) 2,573 (269,838) (13,013)
Net investing cash flows used by discontinued operations - (97,759) - (94,445)
Net cash flows used in investing activities (267,924) (95,186) (269,838) (107,458)
Financing activities
Bought deal equity financing - - - 311,962
Share issue costs - (1,125) - (13,941)
Increase in long-term debt 186,909 - 186,909 -
Repayment of long-term debt, net of discount on
banker’s acceptances - (113,120) (13,463) (113,120)
Exercise of share options and shares issued under the
share purchase plan
1,662
312
10,562
934
Normal course issuer bid purchase of common shares - - - (4,879)
Dividends paid (9,292) (9,755) (19,045) (18,478)
Withholding taxes on settlement of restricted and
deferred share units
(3,893) (1,800) (4,349) (2,224)
Other (234) (217) (446) (431)
Net financing cash flows provided (used) by continuing
operations 175,152 (125,705) 160,168 159,823
Net financing cash flows provided by discontinued operations - 210,225 - 247,362
Net cash flows provided by financing activities 175,152 84,520 160,168 407,185
(Decrease) increase in cash before effects of exchange
rate changes on cash
(45,380) (10,890)
(16,828) 323,113
Effects of exchange rate changes on cash
Continuing operations (3,671) 8,500 (3,687) 8,408
Discontinued operations - 2,223 - 2,064
(Decrease) increase in cash (49,051) (167) (20,515) 333,585
Cash – beginning of period 119,084 449,450 90,548 115,698
Cash – end of period 70,033 449,283 70,033 449,283