Streaming and Royalty Firm Posts Q2 FY19 Earnings Beat 'Thanks to the IRS'

Au Report

Source: Streetwise Reports 02/09/2019

A BMO Capital Markets report reviewed the figures released by this company and explored contributing factors behind them.

In a Feb. 6 research note, analyst Andrew Kaip reported that Royal Gold Inc. (RGLD:NASDAQ; RGL:TSX) achieved an earnings per share (EPS) beat in Q2 FY19.

Kaip relayed the company’s EPS at quarter end was $0.36, after having delivered 79,600 ounces of gold equivalent and generating $97.6 million in revenue. Of that total revenue, $67.7 million were from streams, and $29.9 million were from royalties. These figures were in line with BMO and consensus’ forecasted EPS of $0.31.

Yet Royal Gold’s EPS was a beat due to “$6 million positive true-up based on recently issued Treasury and Internal Revenue Service guidance,” Kaip explained.

Kaip noted Royal Gold’s Q2 FY19 operating cash flow was less than expected, at $58.8 million versus $65 million. That resulted from negative working capital adjustments as the company did not outlay a significant amount of capital during the quarter.

At the end of Q2 FY19, Royal Gold had $157 million in cash and cash equivalents, and full access to its $1 billion revolving credit facility.

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Source:: The Gold Report