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Royal Gold (RGLD) Discloses Operational Updates for Q1

Zacks

Royal Gold, Inc. RGLD provided an update on first-quarter fiscal 2018 (ended Sep 30, 2017) operations. During the quarter, RGLD Gold AG, the fully-owned subsidiary of Royal Gold, sold around 61,000 gold equivalent ounces. This comprises roughly 48,000 ounces of gold, 537,000 ounces of silver and 1,170 tons of copper under streaming agreements. The company ended the quarter with 15,000 ounces of gold and 470,000 ounces of silver in its inventory.

Average realized prices of gold and silver were $1,287 and $16.77 per ounce sold respectively, compared with the prior-quarter figures of $1,259 and $17.32. Average realized copper prices were $6,562 per ton.

In the quarter, cost of sales was roughly $334 per gold equivalent ounce, up from prior-quarter figure of $318. The cost of sales of the company is specific to stream agreements and is based on the quarterly average silver-gold ratio of roughly 76 to 1. Royal Gold will release fiscal first-quarter results before the market opens on Nov 2.

During the fiscal first quarter, Royal Gold paid back $50 million of the outstanding balance amount on its revolving credit facility. As of Sep 30, 2017, the revolver had $200 million outstanding which translates into available revolver capacity of $800 million.


Shares of Royal Goldhave moved up 12.1% in the last three months, outperforming the industry’s 10.4% growth.

Royal Gold reported earnings of 31 cents per share in fiscal fourth-quarter 2017 (ended Jun 30, 2017), compared to 32 cents recorded a year-ago. The figure missed the Zacks Consensus Estimate of 33 cents.

Revenues increased roughly 16% year over year to $108.9 million from $94.1 million recorded a year ago. However, the figure trailed the Zacks Consensus Estimate of $114 million.

Zacks Rank & Stocks to Consider

Royal Gold currently carries a Zacks Rank #5 (Strong Sell).

Some better-ranked stocks in the basic materials space are Sociedad Quimica y Minera de Chile S.A. SQM, The Chemours Company CC and FMC Corporation FMC. All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Sociedad Quimica has an expected long-term earnings growth rate of 32.5%.

Chemours has an expected long-term earnings growth rate of 15.5%.

FMC Corporation has an expected long-term earnings growth rate of 11.3%.

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