Royal Gold's 2025 Q2 Earnings Call: Contradictions in Debt Strategy, African Investments, and Production Guidance

Record Financial Performance:
- Royal Gold reported record revenue of $210 million for Q2 2025, with earnings of $132 million or $2.01 per share.
- This growth was driven by a strong gold price and low, stable cash G&A expenses.

Portfolio Diversification and Acquisitions:
- Royal Gold completed 3 recent acquisitions, including a gold stream on the Kansanshi mine, and a stream and royalty interest on the Warintza project in Ecuador.
- These acquisitions enhance portfolio diversification, with no single asset contributing more than 12% of net asset value.

Strategic Transactions and Growth:
- Royal Gold announced the acquisition of Sandstorm and Horizon Copper, aiming to create a larger, more diversified company with increased scale and growth potential.
- The transaction is expected to benefit from sector-leading asset diversification, simplification of complex intercompany structures, and increased investment from passive funds.

Strong Gold Segment Performance:
- Royal Gold's stream segment revenue was $133 million, up 8% from the prior year, with increased sales from Pueblo Viejo and Khoemacau.
- The growth was supported by a strong gold price and stable stream sales.

Adjusted EBITDA Margin Improvement:
- Royal Gold's adjusted EBITDA margin increased to 84% for the quarter, primarily due to the strong gold price and stable cash G&A expenses.
- This improvement reflects the company's efficient operating structure and effective cost management.