Gold Royalty's Q2 2025: Conflicting Signals on Jerritt Canyon, Cash Flow, and M&A Strategy

Jerritt Canyon revenue expectations, free cash flow and debt repayment, dividend reinstatement strategy, royalties acquisition strategy and time frame, and consolidation strategy and M&A focus are the key contradictions discussed in Gold Royalty's latest 2025Q2 earnings call.



Positive Cash Flow and Revenue Growth:
- Gold Royalty (GROY) achieved positive free cash flow and record quarterly revenue, adjusted EBITDA, and operating cash flow in Q2.
- The growth was driven by contributions from Vareš and Côté Gold Mines, strong gold prices averaging $3,279 per ounce, and flat Q2 G&A costs.

Operational Milestones and Asset Performance:
- Côté Gold Mine reached nameplate throughput ahead of schedule, contributing over $1 million in revenue, with further improvements expected with a new cone crusher.
- Borborema mine received pre-production payments of 250,000 ounces of gold, contributing $1.2 million in revenue, despite not yet reaching commercial production.

Capital Allocation and Debt Reduction:
- Gold Royalty maintains a strategic focus on debt reduction, aiming to be net debt-free by the end of 2026, supported by growing free cash flow and the conversion of debentures.
- The company is considering capital returns to shareholders and strategic growth opportunities as the business deleverages.

Consolidation in the Royalty Sector:
- The company expects accelerating consolidation in the royalty space, driven by new strategic capital entry, recent major mergers, and the desire to create a mid-tier royalty company.
- Gold Royalty sees opportunities for cost synergies and attracting global institutional equity investors through consolidation.