20-F: Gold Royalty Corp. Reports Fiscal Year 2023 Results, Provides Outlook for 2024

Gold Royalty Corp. announces its financial results for the year ended December 31, 2023, highlighting revenue, net loss, and strategic developments, while providing a forward-looking statement for 2024.

Summary

• Gold Royalty Corp. reported a net loss of $26.8 million, or $0.18 per share, for the year ended December 31, 2023, compared to a net loss of $12.7 million in the previous year.
• Revenue for 2023 was $3.0 million, with Total Revenue, Land Agreement Proceeds and Interest at $5.2 million, falling slightly below guidance due to deferred production at Canadian Malartic.
• Cash Operating Expenses decreased by 36% to $8.0 million, aligning with the provided guidance.
• Adjusted Net Loss for 2023 was $4.0 million, or $0.03 per share, compared to an Adjusted Net Loss of $11.2 million in the prior year.
• The company forecasts between 5,000 and 5,600 GEOs in 2024, equating to approximately $10.0 million to $11.2 million in Total Revenue, Land Agreement Proceeds and Interest.
• All core assets have demonstrated considerable progress in 2023, contributing to industry-leading revenue growth through the end of this decade.
• Ct is expected to commence production imminently, Odyssey continues to ramp up, and the company will benefit from a full year of revenue in 2024 from Borborema and Cozamin.

Sentiment

Score: 6

Explanation: The sentiment is neutral. While the company reported a net loss, it also highlighted positive developments in its core assets and a decrease in operating expenses. The outlook for 2024 is positive, with increased GEOs expected.

Positives

• Cash Operating Expenses decreased by 36% to $8.0 million, aligning with the provided guidance.
• Adjusted Net Earnings Per Share for the fourth quarter ended December 31, 2023 were $0.01 per share compared to an Adjusted Net Loss Per Share of $0.02 per share in the fourth quarter of 2022.
• All core assets have demonstrated considerable progress in 2023, contributing to industry-leading revenue growth through the end of this decade.
• Ct is expected to commence production imminently, Odyssey continues to ramp up, and the company will benefit from a full year of revenue in 2024 from Borborema and Cozamin.

Negatives

• Net loss increased to $26.8 million from $12.7 million.
• Revenue was $3.0 million, falling slightly below guidance due to deferred production at Canadian Malartic.

Risks

• Volatility in metal prices could negatively affect results of operations or cash flow.
• Operations in foreign countries are subject to many risks, which could decrease revenues.
• Opposition from Indigenous peoples may delay or suspend development or operations at the properties where we hold royalty or similar interests, which could decrease our revenues.
• The mining industry is subject to environmental risks in the jurisdictions where projects underlying our interests are located, including risk associated with climate change.
• Our operations and those of the owners and operators of the properties underlying our interests may be negatively impacted by the effects of the spread of illnesses or other public health emergencies.

Future Outlook

The company forecasts between 5,000 and 5,600 GEOs in 2024, equating to approximately $10.0 million to $11.2 million in Total Revenue, Land Agreement Proceeds and Interest at a gold price of $2,000 per ounce.

Industry Context

The announcement reflects the ongoing dynamics within the precious metals royalty sector, where companies like Gold Royalty Corp. seek to diversify their portfolios and provide financing solutions to mining companies.

Comparison to Industry Standards

• It's difficult to directly compare Gold Royalty's results to industry standards without knowing the specific composition and stage of development of its royalty portfolio compared to peers.
• Companies like Franco-Nevada, Wheaton Precious Metals, and Osisko Gold Royalties are larger and have more diversified portfolios with a greater proportion of revenue coming from producing assets.
• Junior royalty companies often have a higher risk profile due to their exposure to exploration and development stage projects, but also offer greater potential upside.
• A key metric for comparison would be the company's GEOs per share and its cash operating expenses per GEO compared to its peers.

Related Party Transactions

• The company incurred technology expenses for website design, hosting and maintenance service provided by Blender Media Inc., which is controlled by a family member of a former director.
• The company incurred interest expense to Queen's Road Capital Investment Ltd. on the Debentures. Warren Gilman, director of the Company, is the chairman and chief executive officer of QRC.

Stakeholder Impact

• Shareholders may be concerned about the net loss but encouraged by the positive outlook for 2024.
• Employees may be affected by the company's cost-cutting measures.
• The company's relationships with mining operators are crucial for its revenue generation.

Next Steps

• Ct is expected to commence production imminently.
• Odyssey continues to ramp up.
• The company will benefit from a full year of revenue in 2024 from Borborema and Cozamin.

Key Dates

Keywords

royalties, gold, revenue, mining, Borborema, Cozamin, Canadian Malartic, GEOs