Operations in South America contributed 12% more revenue and 15% less gold equivalent ounces sold when compared to the third quarter of 2023. The increase in revenue was partially driven by stronger royalty revenues from the Fruta del Norte mine in Ecuador and a 55% increase in the number of pounds of copper sold from the Chapada copper mine in Brazil, which benefited from an 18% increase in the average selling price of copper compared to the same period in 2023. Expected lower grades due to mine sequencing at the Cerro Moro mine in Argentina resulted in decreased silver ounces sold under the Cerro Moro silver stream. The decrease was partially offset by a 33% year-over-year increase in the average realized selling price of silver during the third quarter.
FRUTA DEL NORTE
Lundin Gold Inc. ("Lundin Gold") recently announced additional drill results and an expanded near-mine drilling program, with recent intercepts continuing to delineate the new Bonza Sur gold deposit (discovered in 2023) at the Fruta del Norte mine ("FDN"). A metallurgical study is planned for 2024 and a maiden Mineral Resource Estimate for the Bonza Sur deposit is expected by mid-2025. As part of a recent Investor Day, Lundin Gold highlighted the opportunity for Bonza Sur to be its second producing deposit within the La Zarza mining concession and expects a Preliminary Economic Assessment ("PEA") on Bonza Sur to be completed by the end of 2025. For more information, visit www.lundingold.com. Sandstorm holds a 0.9% NSR royalty on the precious metals produced at FDN, which includes the Bonza Sur deposit.
AURIZONA
Mining has resumed at the Aurizona mine in Brazil following the displacement of material at the mine's Piaba pit in March 2024 caused by persistent heavy rains. Equinox Gold reported that the processing plant at Aurizona was idle for May and June but restarted in July. Mining of the Tatajuba deposit, which was originally planned to start in the fourth quarter of 2024, commenced in May and is expected to provide most of the ore feed for the remainder of 2024. For more information, visit www.equinoxgold.com. Sandstorm has a sliding scale NSR royalty on the Aurizona mine based on the price of gold. At gold prices above $2,000 per ounce, the royalty is a 5% NSR.
Other
Streams and royalties on mines in other countries contributed approximately 62% more revenue and 25% more gold equivalent ounces sold when compared to the third quarter of 2023, largely driven by increases in royalty revenue attributable to the Ivrindi mine in Türkiye and the number of gold ounces sold from the Bonikro mine in Côte d'Ivoire.
BONIKRO
In the third quarter, Allied Gold Corporation ("Allied") closed a third party $53 million financing package for advancement initiatives at its Côte d'Ivoire Complex, which includes the Bonikro and Agbaou gold mines. The financing will support the advancement of highly prospective sites with Allied allocating a total of $16.5 million in 2024 to advance high priority targets such as Oume, Akissi-So, Agbalé, and others, which are located within Sandstorm's Bonikro stream claim. Allied expects to accelerate projects that aim to optimize operations, extend mine life, and increase asset value by unlocking additional upside potential. See www.alliedgold.com for more information. Sandstorm has a gold stream on Bonikro whereby the Company will receive 6% of gold produced at the mine until 39,000 ounces are delivered, then 3.5% of gold produced until a cumulative 61,750 ounces of gold have been delivered, then 2% thereafter. The Company currently expects the delivery drop down to the 3.5% level to occur in the second half of 2025.
PLATREEF
Ivanhoe Mines Ltd. ("Ivanhoe") has completed the Phase 1 concentrator at its Platreef PGM project in South Africa. In line with Platreef's optimized development plan schedule, the concentrator will be placed on care and maintenance until the second half of 2025 as Shaft #1 prioritizes waste hoisting to support and accelerate the development of Phase 2. An updated Feasibility Study for Phase 2 and a PEA for the Phase 3 expansion are underway and expected to be complete in the first quarter of 2025. For more information, visit www.ivanhoemines.com. Sandstorm holds a gold stream on the Platreef project whereby Sandstorm is entitled to purchase 37.5% of payable gold produced from Platreef until 131,250 gold ounces have been delivered, then 30% of payable gold produced until an aggregate of 256,980 ounces are delivered, then 1.875% thereafter if certain conditions are met.
Webcast & Conference Call Details
A conference call will be held on Friday, November 8, 2024, starting at 8:30am PST to further discuss the third quarter results. To participate in the conference call, use the following dial-in numbers and conference ID, or join the webcast using the link below:
International: (+1) 437-900-0527
North American Toll-Free: (+1) 888-510-2154
Conference ID: 87406
Webcast URL: https://app.webinar.net/dpZeMJ5W6Y8
Note 1
Sandstorm has included certain performance measures
in this press release that do not have any standardized
meaning prescribed by International Financial Reporting
Standards Accounting Standards as issued by the International
Accounting Standards Board ("IFRS Accounting Standards"
or "IFRS") including, (i) total sales, royalties,
and income from other interests, (ii) attributable
gold equivalent ounce, (iii) average cash cost per
attributable gold equivalent ounce, (iv) cash operating
margin, and (v) cash flows from operating activities
excluding changes in non-cash working capital.
(i) Total sales, royalties and income from other interests
is a non-IFRS financial measure and is calculated
by taking total revenue which includes sales and royalty
revenue, and adding contractual income relating to
royalties, streams and other interests excluding gains
and losses on dispositions. The Company presents Total
Sales, Royalties and Income from other interests as
it believes that certain investors use this information
to evaluate the Company's performance and ability
to generate cash flow in comparison to other streaming
and royalty companies in the precious metals mining
industry.
(ii) Attributable gold equivalent ounce is a non-IFRS financial
ratio that uses total sales, royalties, and income
from other interests as a component. Attributable
gold equivalent ounce is calculated by dividing the
Company's total sales, royalties, and income from
other interests, less revenue attributable to non-controlling
shareholders for the period, by the average realized
gold price per ounce from the Company's gold streams
for the same respective period. The Company presents
Attributable Gold Equivalent ounce as it believes
that certain investors use this information to evaluate
the Company's performance in comparison to other streaming
and royalty companies in the precious metals mining
industry that present results on a similar basis.
(iii) Average cash cost per attributable gold equivalent
ounce is calculated by dividing the Company's cost
of sales, excluding depletion by the number of attributable
gold equivalent ounces. The Company presents average
cash cost per Attributable Gold Equivalent ounce as
it believes that certain investors use this information
to evaluate the Company's performance and ability
to generate cash flow in comparison to other streaming
and royalty companies in the precious metals mining
industry who present results on a similar basis.
(iv) Cash operating margin is calculated by subtracting
the average cash cost per attributable gold equivalent
ounce from the average realized gold price per ounce
from the Company's gold streams. The Company presents
cash operating margin as it believes that certain
investors use this information to evaluate the Company's
performance and ability to generate cash flow in comparison
to other streaming and royalty companies in the precious
metals mining industry that present results on a similar
basis.
(v) Cash flows from operating activities excluding changes
in non-cash working capital is a non-IFRS financial
measure that is calculated by adding back the decrease
or subtracting the increase in changes in non-cash
working capital to or from cash provided by (used
in) operating activities. The Company presents cash
flows from operating activities excluding changes
in non-cash working capital as it believes that certain
investors use this information to evaluate the Company's
performance in comparison to other streaming and royalty
companies in the precious metals mining industry that
present results on a similar basis.
Refer to pages 32--34 of the Company's MD&A for the
quarter ended September 30, 2024, which is available
on SEDAR+ at www.sedarplus.com, for a numerical reconciliation
of the non-IFRS financial measures described above.
The presentation of these non-IFRS financial 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. Other companies may calculate these non-IFRS
financial measures differently.
Contact Information
For more information about Sandstorm Gold Royalties, please visit our website at www.sandstormgold.com or email us at info@sandstormgold.com.
ABOUT SANDSTORM GOLD ROYALTIES
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