PRECIOUS METALS

Royal Gold announces results for transition period and Q4

Company's income, revenue and cashflow improved in 2021

Petra Witowski
Royal Gold announces results for transition period and Q4

 

The increase was due to higher sales from the Khoemacau and NX gold streams, higher royalty revenue from Cortez and the bullish copper market.

Royal Gold also announced results from its transition period after it completed the change from fiscal-year-end to a calendar-year reporting schedule. This enabled the company to align its reporting schedule more closely with the precious metals sector, as well as the majority of its stream and royalty counterparties.

During the key transition period in 2021, Royal Gold's revenue reached $343 million and operating cash flow hit $248.8 million, an increase of 12% and 28%, respectively, from the same period in the previous year.

Approximately 73% of revenue was from gold, with 11% from silver and 12% from copper.

BMO Capital Markets analyst Jackie Przybylowski said that BMO was maintaining the company's ‘market perform' rating. The one-year-target was slightly lowered to $133/share.

"The company faces headwinds at two key assets that continue to underperform," Przybylowski said. "However, these challenges also present an opportunity for the company."

Progress at the Khoemacau copper project in Botswana was delayed during the last quarter due to the effect of the COVID-19 pandemic on the availability of skilled operators, as well as typical ramp up issues when drilling and blasting in a new ore body.

The company has also been affected by changes to expected gold and copper production at Centerra Gold's Mount Milligan mine in Canada.

On February 16, Royal Gold traded on the Nasdaq at US$110.42/share, moving 1.3% higher on the day. This was the first time its shares climbed above the $110 mark since September last year.

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