And gentlemen, welcome to today. My name is Noella Alexander Young, virtual event moderator here at Renmark Financial Communications. On behalf of our team, we'd like to thank everyone in Los Angeles and surrounding areas for joining us today for the presentation of Royal Gold, trading on the Nasdaq under the ticker symbol RGLD. Presenting today is Alistair Baker, Senior Vice President of Investor Relations and Business Development. The presentation will last approximately twenty-five minutes and will be followed by a Q&A session, for which you can participate using the chat box in the top right-hand corner of your screen. With that being said, I will now hand the floor over to Alistair.
Well, thanks very much, Noella, and thanks everybody for your attention today. We've had a very strong run-up in the gold price over the past several months, so it's a very timely opportunity for me to give you an update on Royal Gold and what we've been up to. I will start this presentation with the obligatory comment that I will be making forward-looking statements during the presentation. Risks and uncertainties could cause actual results to differ materially from these statements. All of these risks and uncertainties are discussed in our most recent Form 10-K filing with the SEC.
So now with that out of the way, I'll give you an update on what we've been up to, and I'll start with a little bit about the investment thesis for Royal Gold, which is really what we provide to investors in one sentence would be, precious metals exposure with consistent financial performance and a focus on per share metrics. So this presentation is divided into sections to explain how we provide this. First, I'll talk about our low-risk leverage to the gold price, our long history of executing a very simple business strategy. I'll talk about our unique business model, talk about our portfolio and some of the organic growth potential within that portfolio. Finally, I'll end on valuation, which despite the high gold price, I think we're still trading at pretty attractive levels compared to where we have in the past.
As an introduction, this slide gives you an overview of Royal Gold at a high level. We are a high-margin business that generates consistent cash flows, precious metals, and we've been in the business since the 1980s and on the Nasdaq exchange now for over 40 years. We have a very long history in this business. In 2023, our revenue was just over $600 million, and we have two segments that contribute revenue to our business. We have our streaming segment, which is about 69% of our revenue, and our royalty segment, which is about 31%. These are different kinds of structures, but they basically provide the same thing, which is top-line exposure to mining assets and the production from those assets.
We released our second quarter results in early August, and in about three weeks, we're re-releasing our third quarter results on November sixth. But in our second quarter results, we had very strong financials. We had $174 million of revenue, $81 million of earnings, and our EBITDA margin was 81% in line with where we have been over the past many quarters. About 74% of our revenue came from gold, and about 56% of our revenue came from Canada, USA, and Australia. We ended the quarter with $50 million of debt, which we subsequently repaid very quickly, shortly after the quarter results were announced. We have a clean balance sheet at the moment. Now, where do we sit in the royalty streaming sector?
If you're an investor looking at our sector and you're wondering, "How does Royal Gold fit in with peers?" You can see this on this graph, on this slide. So we sit in a very interesting position. We're large enough to compete for the largest transactions. We have significant cash flow, and we have access to low-cost capital, yet we're also small enough to be able to show growth. So a small transaction to Royal Gold can actually be meaningful. Small transactions to our largest peers may actually not be meaningful to them, and that's an important differentiator when you think about where we are today in today's market and the opportunities for growth that we will talk about later on in this presentation. Now, with that out of the way, I'll talk a little bit about our leverage to gold.
This slide, for those of you who do not know Royal Gold, and you're thinking about gold as an investment, this shows how we are positioned. Our model provides exposure to precious metals without many of the risks that come with owning investments or equities in operating companies. We provide exposure, upside exposure to gold, to the price itself, but also the optionality in the portfolio and the assets we invest in. That's with a reduced downside risk that comes from holding a diverse portfolio that does not have direct exposure to operating and capital costs. That's very important when you think about inflation and margin erosion. As the gold price rises, sometimes costs increase as well, and you don't get that additional margin. In our business, we're structured in such a way that you do.
There are other ways you can invest in gold. If you want to be very conservative, you can invest in physical gold, but physical gold will never pay you a dividend, and one ounce will always be an ounce, so you're not getting any optionality from that. You can be more aggressive, and you can invest in operating companies or exploration companies. You'll certainly get exposure to optionality, but you'll also get exposure to operating and capital cost risk. So we sit in the middle, and we like to think of ourselves as being a pretty conservative way to invest in a very volatile commodity. Now, our historic performance shows why we think we're a good alternative for those who are looking for that kind of exposure.
On the left-hand side of this graph, you can see our beta to the gold price is 1.8, so we have very strong leverage to the gold price. But on the right-hand side, you can see our share price performance over time. This graph goes back to the founding of the GDX index in 2006. We're one of the original members of the GDX index, so it's a prime comparator for us. But over that time period, we have beaten the gold price, we've beaten the GDX index, and we've also performed very well when you think about the general market indices. And I think that's something that people often don't appreciate. Now, in this next section, I'm gonna talk about our history of execution. We said we have, like I said, a very long record of consistent and disciplined performance.
This slide is one of my favorites, when I talk about Royal Gold. It's a twenty-year snapshot of how we've allocated our capital and how we've grown. Growing our business is really driven around trying to provide accretive growth to our shareholders. Since 2000 , you can see that we've had significant growth in revenue and operating cash flow, but there are three things in this growth that I really wanna hammer home. The first is, our business is high margin and it's scalable. Our revenue growth has far exceeded our growth in G&A expense, and we don't need to add people when we add assets to our business. When we grow our business, we're able to keep our headcount relatively flat. That's point number one.
Point number two is our revenue growth is not dependent, or over this period, has certainly not been dependent on metal prices alone. Metal prices have generally risen since 2000, but we've been able to add volume to our portfolio during that period. So we've been able to acquire assets and continue growing the basis of our revenue. And then thirdly, we financed our growth internally without a significant rise in our share count. We are, as I mentioned, we're one of the founding members of the GDX index, and we have the lowest share count in the GDX index. We have not issued equity since 2012.
We want to avoid shareholder dilution, and if we can fund our business internally or using internal resources, then that means that we can provide per share growth to our shareholders, and that's really what it's all about. Now, this slide shows a snapshot of our liquidity. We have to be patient in our business, so that means that we have to have a strong balance sheet. We have to have liquidity on hand to be able to act on opportunities that come up quickly and sometimes out of left field. Our approach to funding our growth is really to use internal resources, I said, so it's cash on hand, it's our operating cash flow, and it's our revolving credit facility, and then equity is the least preferred source of financing for us.
The waterfall graph on the left-hand side of this slide shows you how we allocated our cash flow in 2023. We used our operating cash flow to repay debt and to pay our dividends. On the right-hand side, you can see our liquidity at the end of the second quarter was $961 million. That included our working capital, but as I said, we've repaid $50 million of debt outstanding, so we now have $1 billion of our revolving credit facility available and undrawn. That's lots of liquidity for our business development environment we find ourselves in today. Now, slide twelve here shows you how we have used this credit facility, and it, as I said, it's a $1 billion revolver, and that provides to us very cheap and flexible financing.
We have eight top-tier banks in the revolving credit facility, and the way we use our credit facility is we draw on it when we make an acquisition, and then we'll pay back the drawing based on our cash flow as it comes in over the subsequent quarters. 2022 was a big year for Royal Gold, and we did a couple of very large transactions. We borrowed in the third and the fourth quarter of that year to acquire long-l ife royalties, the Cortez Complex in Nevada, and the Great Bear project in Ontario, and we've now repaid all of those borrowings. That rapid repayment really shows you how our cash flow, how our portfolio generates cash flow. We do get asked the question, "Well, how can you afford to buy these assets if you're paying interest?
Isn't that part of your cost?" Certainly, it is a cost, but it's a short-term cost. As you can see, we've paid our revolving credit facility balanced down quickly, and we think that's a very worthy trade-off. When you think about assets that we acquired that have lifelines of twenty-plus years, a couple of quarters of interest costs is really de minimis when you're thinking about the overall return. Now, we like to think about our shareholders as well and returning capital to shareholders, and that's a key strategic objective for us at Royal Gold, and it's something that makes us very unique when you think about other precious metals investments. We've paid a growing and sustainable dividend since 2000 , and we've increased the dividend every year since, and that's despite volatility in the gold price.
We've paid out almost $1 billion in dividends since we started paying a dividend. We're the only company in the GDX index that's paid an increasing dividend every year since the index was formed in 2006, and we're the only precious metals company, period, in the S&P High Yield Dividend Aristocrats Index. So that sets us apart from every other company in the precious metals sector. Now, something else that sets us apart, we think, is our due diligence competency. And due diligence and having a team that's able to do due diligence properly is a core competency in our business. We think about this. It is a very important part when you look at and you ask that you wanna add the right assets, and you wanna avoid the wrong assets. So we're always busy looking at opportunities.
There's no shortage of things to look at, but not all opportunities we look at make it through our screens. Our process is very extensive. We're very disciplined in the way we deploy capital. If we see risks that we don't like or we can't mitigate, we'll walk away from transactions. Our board does not give us pressure to do a certain number of transactions in a certain time period. So if we can't find the right opportunities, we're happy to collect revenue from the portfolio, build our balance sheet, and just wait for the right opportunities. History has shown us those opportunities always come up. 2023 is a case in point. We were very busy in 2022, and in 2023, we didn't see the right opportunities.
So what we did was we paid down our debt, we paid our dividends, we rebuilt our liquidity. Now, ESG or sustainability, whatever, whatever you want to call it, is something that's very important to Royal Gold and always has been. We don't have direct operating control in our business, but we invest for the long term. So the sustainability of the assets we invest in is very important, and that's an important thing that we look at when we do our due diligence. We always try and build language into our transaction documentation that will encourage operators to operate to the highest standards. And we're always looking to help our counterparties if they have social or environmental projects going on around the assets where we invest. We're always looking to help them as well because that, again, goes to sustainability.
On this slide, I've got a couple of ratings shown from MSCI and Sustainalytics. They're two of the most important or influential ratings providers in our sector, and you can see that there's been a positive trend over time. It's not necessarily because we've changed our practices, but what we have done is we've improved our transparency, and I think that's reflected in the scores over time. I'm gonna move on to the next section now and just talk about our business model, which is pretty unique, and this slide shows the key to our model, and that's optionality, and that's optionality to reserve and resource growth of the assets where we invest without having to pay any further to get exposure to that optionality. There are two assets shown here, two examples.
We made these investments in 2015 , and in both cases, total reserves and resources today are higher than at the time when we made the original acquisitions, and that's in addition to the production that's occurred since 2015 . So at PV, on the left-hand side, we've recovered over 85% of our initial investment. At Wassa, on the right-hand side, we've recovered well over 140% of our original investment, and there are still growth projects underway at these assets. At PV, there's a plant expansion that's in the final stages of commissioning, and that plant expansion was done to increase gold production levels and extend the mine life to the twenty-forties.
At Wassa, there's about a four-year mine life remaining on reserves, but there's also a tremendous resource that could add another potentially twenty years to that asset. In both cases, Royal Gold is not required to fund any further to get exposure to that upside. We've already paid for it. We paid for it on day one, so this is free upside, if you will, and this is the optionality that our shareholders get to benefit from. So we're always looking for that exploration and production upside when we do due diligence of new opportunities, because it really is the key feature of our business model. Now, another feature is efficiency, and we are a very efficient business. We have thirty employees. The company last year, as I said, produced over $600 million of revenue.
Our market cap today is about $9.5 billion. So on a per employee basis, we compare very well to any large company in any sector. It is a very efficient, lean business. And that low employee count really means that we have a low fixed cash G&A, which obviously further contributes to that efficiency. Our EBITDA margin in 2023 was 79%, and our cash G&A was about 5% of revenue. And our G&A is low and is mostly fixed costs, or things that don't move in the short term, so inflation should not be a risk to our margins. And you can see that more clearly on this slide, where I've separated our cost structure and the cost structure of the average gold producer.
If you look at the cost structure of the average gold producer, they're exposed to inflation and input costs. So labor, energy, consumables, anything that they use to produce, generally is exposed to inflation pressure. Whereas you look at our G&A costs, and they're usually pretty steady. So things like salaries, services, office rents, those don't change on a month-by-month basis, not typically, subject to short-term increases. So our margins are a lot less exposed to inflation pressures simply because we're not directly exposed to operating and capital costs. Now, in this next section, I'll talk for a few minutes about our portfolio, which has, you know, lots of depth, it's quite broad, and it's got good organic growth potential within it. And this slide shows you where we are, across the globe.
Our portfolio is pretty much weighted towards lower risk and more mining-friendly jurisdictions. And the principal properties, you can see on the right-hand side, they're actually called out. Those provide the bulk of our revenue. And if you look at established mining camps around the world, we have exposure to many of those. About 50% of our revenue comes from Nevada, British Columbia, and Western Australia, and we have significant exposure to earlier-stage projects in all of these regions. When you go into a historic mining area that's still active, generally, there's excellent prospectivity. There's also supportive regulatory environments, and there's access to people and expertise in those mining jurisdictions. And the saying is that the best place to find a mine is near a mine.
So we think we're pretty well situated to capture additional upside that could come from exploration success in these areas. Now, our portfolio is well diversified, and that provides stability to us. Our operators are best in class, some of the largest, most well-capitalized and experienced companies in the world are our counterparties. We have, on the number of assets, we've got 40 assets for each revenue, so that portfolio breadth is large compared to any producing mining company. Our underlying assets are about 50% precious metals dominant, 50% would be copper, gold, or base metals. And our largest country exposures are to Canada, USA, the Dominican Republic, and Chile. So these are all mining-friendly jurisdictions. So that this portfolio diversification really does reduce our exposure to single asset operator at jurisdictional risk.
Our portfolio spans the various stages of mining project developments. We have 135 assets that are not producing today in various stages of either exploration, evaluation, or development. And organic growth occurs when these assets move through this pipeline, from the left-hand side to the right-hand side, and actually get to producing revenue. We've seen some examples of this in the last couple of years. King of the Hills and Bellevue Gold are two very good examples in Western Australia. They've been in the portfolio for well over 10 years. They were dormant for many, many years, but then recently, new management teams have come in, and they've actually started producing revenue to us at both of these operations in the last couple of quarters.
And to continue on this theme of organic growth, this slide shows some of the key catalysts that we see in the portfolio today. The light blue assets at the top show where we see the potential for mine life extensions and production increases, and these are assets that are already producing in our portfolio. The gold arrows in the middle of the page show development assets, and many of these have actually just started producing revenue to us. So, for example, we had first gold in the first quarter of this year from Mara Rosa in Brazil and Coté Gold in Canada. The Goldr ush Project at the Cortez Complex is ramping up production today as we speak.
The Manh Choh Project in Alaska, first gold was poured in July of this year, and we're expecting Back River to start producing early in 2025, and then further down the road, the Great Bear Project towards the end of this decade. Now, all of the growth that's shown on this slide is free optionality to our shareholders. We have paid for it all. It's all fully funded. We do not need to pay any more to get exposure to this growth. Now, we're always focused on organic growth because that's free upside, as I said, but we're always looking to add new assets to the portfolio, and we've been very active over the past several years, and this slide summarizes what we've done over the past two or three years.
We've deployed $1.2 billion of capital in seven transactions on six assets, and these are all assets that provide gold exposure with upside potential in safe jurisdictions. We funded all of these transactions using our cash on hand and a revolving credit facility, and we have not issued any shares that would dilute our shareholders' exposure to these new assets. I'll talk for a moment about some of these assets in a bit more detail. Cortez in the top left-hand corner, this is a mine in Nevada, operated by Barrick and Newmont, two of the largest companies in the global gold business. We've owned several royalties here for many years, but in 2022, we had an opportunity to grow our position substantially, and now we have exposure to the entire Cortez Complex.
There's a lot of growth potential at this complex. You've got the Goldr ush asset ramping up production, you've got the Fourm ile project, you've got the Robertson project, and there's a lot of exploration potential as well. And it's also one of the largest producers in the Barrick and Newmont portfolios. At Red Chris in Northern British Columbia, Newmont owns this asset. They're working on studies to advance, moving this from a relatively small pit to a large bulk tonnage operation. Last time any information was put out into the marketplace, they were talking about a 36-plus year mine life, but that does not include exploration success that they've seen over the past couple of years. At the Xavantina mine in Brazil, Ero Copper is the operator there.
They've had tremendous exploration success, and they're now targeting 60,000 ounces per year of production on a sustained basis. The Coté Gold Project in Ontario, I mentioned that. They poured their first gold in March of this year, and they're targeting commercial production in the current quarter today. At the Great Bear Project in Ontario, Kinross has done a very good job of advancing that one. They announced a PEA, Preliminary Economic Assessment, in September, with over 6 million ounces of resources, and they're targeting 500,000 ounces a year of production over the first eight years. They've also got extensive exploration programs underway, where they intend or they expect to be able to add to that resource potential and extend the mine life further.
And then the most recent transaction we completed was to acquire additional royalties on the Back River project in Nunavut, which is northern Canada. We already had a royalty position there, but we acquired some more in the second quarter of this year. We now have an approximate 3.3% Gross Smelter Return royalty on this asset. Construction is well underway, and it's a fifteen-year mine life, starting in the second quarter of next year. A total of 3.3 million ounces of production is targeted. If I was to sum all of this up, there's a lot on this slide, but I'd say it is very simple.
It all fits with our theme of being consistent with our strategy of adding precious metals exposure on assets that have production and exploration upside in safe jurisdictions. So a bit of a report card of what we've been up to over the past couple of years. I will end on valuation, and I think we are trading at pretty historically attractive multiples. Our business is performing very well. We've got strong cash flow and very disciplined with our capital allocation. We've got good organic growth from within the portfolio, but it doesn't feel to me like our share price is reflecting that, and it certainly doesn't feel like it's reflecting the strong gold price outlook.
If you look at our cash flow multiple, we're trading in the bottom half of our peer group, and I think that's simply because the market is not valuing the long life assets and the optionality associated with those assets, and I think more generally speaking, the market today is just not valuing or ascribing longevity to this higher gold term gold price environment, which I think is around for the long term, so higher long-term gold price obviously will impact our cash flow in a positive way, so I think we're actually trading at a pretty good, an attractive level today. Now, I've come to the end of my formal presentations. I think, as I said, we're and we feel we're in a very good position today at Royal Gold.
Our record is strong, our business is performing very well. We've got very high-quality assets and a well-diversified portfolio. We've got strong organic growth from within that portfolio, and we're trading at a pretty attractive valuation while we have a strong balance sheet and lots of liquidity to be able to compete for future business development opportunities. So we're feeling pretty good about our business and where we are today. So with that, Noella, I'll turn it back to you for Q&A. We've come to the end, and I'd be happy to try and answer any questions that the audience may have.
Thank you very much, Alistair, for the presentation. As you said, we'll now begin the Q&A. Your first question is: Are the metals held in inventory destined to be sold during the next quarter?
Yes. We do not hold metal for speculative reasons. What we do is we receive a shipment or a delivery of metal from a counterparty, and we will sell that over a period of time, kind of in equal increments, to the point where we estimate getting the next shipment, so inventory is a time and place kind of measure. Just at the end of the quarter, we'll sometimes have inventory that is not yet sold, but our intention is to sell that down completely before we receive another delivery from that same operator, and so the inventory is not something to focus on necessarily because we're always in the market selling.
We want to be able to mimic or realize the average gold price over any period, and so we're in the market all the time. We don't speculate and wait and say, "Well, we think next week the gold price will be higher. Let's wait until then before we sell." We don't do that. We just try and sell in even increments.
Thank you for that response, Alistair. Your next question is: Are the bulk of your royalties covered for the life of mine?
Yes. Yes, they are. We are very concerned about having exposure to the long term when we do a transaction. We don't like to have caps. We don't like to have early termination of royalties. And it's simply because if we do that, then we don't have exposure to what could happen in the future. So if the gold price continues to rise, then perhaps resources that aren't economic today will suddenly become economic. They'll enter a mine plan. That's optionality for us in the future. If we have a cap or something that causes the royalty or a stream to end, then we don't have exposure to that. So we're always very careful about making sure that we have long life exposure to assets.
Now, in some cases, we will buy a basket of assets, a basket of royalties from a third party that perhaps has accumulated those, and sometimes we will encounter caps or other things that we wouldn't normally put in place, but it's definitely not something we like to see. And the majority, vast majority of things that we own do have that life-of-mine exposure.
Thank you for clarifying that. The next question here is: Would you say that metal prices are the key driver for the increase across the board in your financial metrics?
Metal prices certainly have been over the last several quarters. They have been a huge contributor to us, but as I said in the presentation, we've been able to, over the long term, we've been able to add volume to our portfolio. So, you know, our transaction cadence may look very lumpy. It looks sometimes we don't do anything, and then suddenly, there's a flurry of transactions. But that's... You know, if you average things out, I think over the period that I've got shown in the presentation there, since the beginning of the company, we've done 41 transactions, so it's about one a year. We're always looking to add to the portfolio, but certainly, metal prices have been helpful to us.
Any increase in revenue directly or any increase in the gold price or metal prices directly shows up in our revenue, so absolutely, it is important.
Thank you, Alistair. Next, a viewer says: Mexico has pulled back on possibly changing open-pit mining regulations. How many of your partners operate open-pit operations in Mexico?
We have one currently, and that's Peñasquito, and that's operated by Newmont. My understanding of what's happened in Mexico is that it would be, if this law was put into place, it would affect only new assets, and it wouldn't affect any existing assets. So we don't feel it would impact Peñasquito, but it's unclear. What is happening there and what the status is, I can't tell you what it is right at this point, but we don't have a lot of exposure to Mexico. Mexico has unfortunately become riskier for many different reasons. There's political, there's also safety and other things. Mexico's a fantastic jurisdiction from a resource perspective, but we've been careful about exposing ourselves too much to Mexico.
Thank you for your insight on that, Alistair. Your next question: What's the company's view on using paper for acquisitions?
We're not opposed to it, but if we're acquiring assets one by one, like if we buy a royalty or a stream, often what our counterparty wants is cash. So, Royal Gold paper is not something that they would want. It's also, you know... I tried to make the point in the presentation that we're very averse to issuing equity. I think if we can use cash because we have cash flow coming in from the portfolio every day, if we can use that to invest, we'd prefer to buy assets using that as a financial resource rather than issuing equity. If we issue equity, then what we're doing is we're diluting those shareholders who've been with us for a long time, and that would create some concern probably with them. So, cash is our preferred method.
Now, never say never. There may be opportunities that are too big for us to use cash only because we just don't have enough, so we would have to consider using equity, for the right opportunities, but it's certainly not preferred.
Thank you for shedding some light on that. Next, on average, how long is your due diligence process in looking at a new opportunity? Has there been pressure to expedite processes to keep a competitive edge?
There's always pressure to get things done yesterday, for sure, but generally speaking, I think we spend, and we like to say we could do a transaction within six weeks of initial being alerted to it, and that's if everything is available to us to review and it's a seamless process, and you need your counterparty to be able to provide information quickly and answer questions quickly to be able to meet that timeline. What we typically find is that we'll spend probably between three months and maybe five on an opportunity. They tend to be. Opportunities often don't move in a perfectly straight line, so you end up having to do certain things during your analysis that may be unanticipated.
The counterparty may decide they wanna hold things, they wanna slow things down a little bit while they consider other alternatives. If it's competitive, then they may want to catch up other players up to where we are, so a lot of things can influence timing, but generally speaking, we spend about three to five months on due diligence of opportunities.
Thank you, Alistair. Next, a viewer says: "Sorry if I missed it, but what has been the total investment by Royal Gold to date, and what is the total return to date?
That number would be, off the top of my head, and it's in... We did an investor update in April, and it's in that, in the materials for that. It's around $4.9 billion total dollars invested. But please have a look at that presentation to get the exact number. We, on an overall basis, I can't give you a return number because we've invested at different points in time. Some of those investments have not even paid back their original capital because these are long-term investments. But what we have, also in that same presentation, you can see, what the street estimates are of some of the returns that we've made. Some of them are very, very high.
Some of the original investments we made, when we started the company, got a couple that would be in the hundreds of %. But as you add assets to the portfolio, you need to be able to give enough time for those assets to kinda show their potential before you can really figure out what the return is. And in many cases, these assets are still operating, so I can't give you a return because there is still return to come, and I don't know what that will be. We have an example in our investor materials of a mine where we had... The previous question about caps and royalties that terminate, we actually had one of those.
And so it was. It's not something we like to have in our portfolio, but it gave us a very good opportunity to be able to say, "Okay, what did we actually what was our return on that investment?" This was an investment in Mexico. It was a Mulatos Mine. We invested. We bought a royalty in 2005 or 2006 , and there was a cap. So after 2 million ounces of production from that asset, the royalty fell away, but we returned about 36% from that investment. So that's the kind of return that we're always looking for. I can't promise you that we're going to get that return, but that's when we look at a new opportunity, that's the kind of return that we're looking for. It's, it's definitely well into the double digits.
Thank you, Alistair. The next question: With several development projects in the mix, which one will be starting operations, say, over the next year?
It would be Back River in northern Canada. Second quarter of next year is when they're expecting to produce first gold. So that's when we would expect to see contribution to our accounts from that asset.
Thank you for your response. The next question for you is: The stock trading near its 52 week high, what catalyst do you think it will take to attain a new record high for the stock?
... Well, I think the rising gold price obviously is very helpful to us. I think the catalyst that we probably need to see is a shift in the market. And if you look at the market today, a lot of the best performing companies are mega cap tech stocks, and so they have kind of sucked the air out of the room. And a lot of smaller companies like ours, we have great business fundamentals, many other companies do as well, but they're just not getting recognized by the market. So I think what you need to see is a bit of a change in market dynamic, and I don't know what will cause that. Likely be something out of left field.
But when people start looking at our company and other smaller companies as well, and they realize there's a lot, a lot of value in these companies and trading at very good valuation levels, you may see a rotation out of those larger companies that have done very well, and you may see a rotation into the smaller companies. So I think there is a catalyst that's more of a market-driven event. I mean, for us, we can't control the stock price. We all we say is, all we can do is do what we do best. So we're always looking for the right opportunities to invest in. We're looking to allocate our capital effectively. We're looking to pay our dividends. We're looking to keep our balance sheet clean and as close to debt-free as possible, and be diligent.
All of those things, if we do them all consistently, then the stock price will look after itself. In certain periods, though, it's frustrating because you do all those things, you just don't see the reaction that you would expect to get from the market. But I think we're in one of those periods where I look at the stock price every day. Yeah, sure, we're doing very well, but the gold price is at record levels. So, I would like to see the stock price higher. All we can do, though, is just continue executing, and the market will catch up.
Thank you for that response. The next question is: Do you know what the production estimates are for the Cortez CC zone in twenty twenty-five?
We have not given any guidance for 2025, and Barrick has not given us anything that would allow us to be able to give that guidance. So stay tuned. We will be giving guidance early in 2025, and that will be something that we will, we'll try and give some clarity on.
Thank you, Alistair. The next question: I didn't see a share structure slide. Could you quickly go over it?
So we are widely held. About 85% of our shares are held by institutionals, institutional investors. About 15% of our shareholders are retail, the remainder are institutions. It's a fairly concentrated register, so we have the top 10 would be 50%-60% of our total shares outstanding. But if you look at those shareholders, very high-quality shareholders, Capital World, First Eagle, State Street, Vanguard, VanEck, you know, a lot of the largest fund managers in the U.S. marketplace, Fidelity. So a very good quality register. We don't have any strategic holders or the... Unfortunately, I wish I could say I was a major shareholder of Royal Gold. It's a big part of my net worth, but I'm not a major shareholder. It's too big of a company.
But management owns about 350,000 shares in total, and that includes the board and management. So we are well invested and incentivized to make sure that we're doing things in alignment with what shareholders would want. So I think that's... I can't think of anything else that would be specific to the register, except to say it's a good quality institutional register.
Thank you for clarifying that, Alistair. Your next question: In your opinion, are there any up-and-coming jurisdictions that have near-term opportunity?
We're always looking at new jurisdictions, and I wouldn't target one in particular, but I'll give an example. We invested in the Khoemacau copper-silver asset in Botswana in 2019. We had never been to Botswana prior to that, so it was a learning experience for us. We spent some time looking at the jurisdiction on paper, but we also visited the jurisdiction. We spoke to governments, you know, diplomats, U.S. State Department. We spoke to others who we know personally who have operated and lived in Botswana. So we did a lot of work on Botswana and got comfort with it, and we're very happy with being invested in Botswana. It's been a great investment for us, and it's been a good jurisdiction. We are open to new jurisdictions.
There are certain places where we just don't want to go. We don't want exposure to places like Venezuela, Russia, China, anywhere where there's a excessive government involvement and rule of law or there's no security and contracts, tenure, things like that, we will shy away from.
Thank you for that response, Alistair. The next question: Do you believe your large North American exposure is a differentiator compared to other royalty/streaming companies?
I think it is, yes. We like to talk about our jurisdictional exposure from a revenue perspective and a NAV perspective. And if you think about some of the things that have happened in our sector in the last couple of years, one of our major peers had an asset that has basically been stalled or you could say is in the process of being taken away from the operator. So that was in a jurisdiction where yeah, it was a little tougher. But if you think about where we are, we're British Columbia, Nevada, Ontario, places like that. There is a very long and understood history of mining. Governments will not mess around with ownership of assets in those places, so we feel very confident.
We're always subject to tax increases and things like that, but those are generally minor relative to expropriation. So, yeah, we feel very comfortable with our geopolitical risk exposure, and I think that is something that's very attractive for Royal Gold.
Thank you, Alistair, for your response. The next question: If interest rates continue to fall next year, do you think you'll be more inclined to add more to your portfolio?
We don't strategically say from one year to the next, we really want to add more this year. We're a taker of opportunities. So if interest rates continue to fall, what that probably means is the gold price will continue to rise, which means that there may be more projects that people are trying to push forward. Other companies or operating companies are trying to push forward to take advantage of that higher gold price. If that's the case, there may be more financing opportunities for us. So I think a lower interest rate environment should be positive for our business. It certainly should help us on the top line because it'll just mean more revenue, but it may also mean more business development opportunities as more projects get pushed forward.
Thank you, Alistair, for your response. We're coming up on your last two questions. The first one is: What specific factors go into calculating how much the dividend will increase by?
So when we think about our dividend, we think about it toward growing and sustainable. And so when we look at a dividend, and it's generally once a year, we'll go to the board recommendation for a dividend increase or a change, and we'll look forward and say, "What do we think the portfolio is going to do? What do we think our cash flow is going to be? Where were we last year with our dividend?" It's kind of a multi-factor analysis. I wouldn't say it's... It's not, certainly not formulaic. We don't say, "Last year, we raised it by 7%, so this year we'll raise it by 7% again." We don't do it like that.
It is a bit more subjective, and what we want to do is make sure that if we raise the dividend this year, then next year, when we go to look at it again, we can look back and say, "Okay, we did that last year. Now we'll raise it again for the next year." And we look forward a number of years. So we always wanna be able to try to show that the dividend is growing, but we also want it to be sustainable. We never wanna raise it one year and say, "There's a risk that we're gonna cut that in the future." So it's a bit of a subjective exercise. There is a lot of analysis that goes into it, but it's not formulaic.
Thank you for your insight on that, and your last question for today is: Given the positive environment in metal prices, generally good margins for miners, are royalty and streaming companies still better to invest in versus miners?
It depends what you're looking for. If you're looking for kind of a conservative approach that still gives you metal price leverage, then, yeah, a company like Royal Gold is a great investment. We have many producing assets. As I tried to explain during the presentation, we have diversification within our portfolio. We still have the optionality and upside, the exposure to assets. When you invest in a mining company, you are taking on a certain amount of risk as well when it comes to operating costs or capital costs and things like that. So it really depends on what you're looking for as an investor. I think over time, royalty and streaming companies have done very, very well. They're less volatile. Operating companies are more volatile.
They're certainly more exposed to metal prices, and, you know, when metal prices are increasing, they provide tremendous leverage, but leverage cuts both ways, so you need to be very careful. You need to do a lot more due diligence when you invest in an operating company because you need to understand the assets in more detail. With a company like ours, you're investing in a broader portfolio, so you don't necessarily need to understand the assets in as much detail. So that would be the thought that I would give to answer that question, but it really is an individual decision to make.
Excellent. Thank you very much, Alistair, for your responses today, and thank you to everyone who submitted questions. If you did not get a chance to submit your question, you can reach out to the appropriate account manager here at Renmark. That concludes our presentation for today, but before we go, I will turn the mic back over to you, Alistair, for final remarks.
Thanks very much, everybody. I enjoyed the Q&A session. There's some very good questions there. So if there's anything that I didn't answer, please get back to Renmark, let them know, and they'll chase me up, and I'll get you an answer. If not, I guess I'll look forward to talking to you again, hopefully soon. So thanks very much, and look forward to that.
Thank you, Alistair, and once again, this was Royal Gold, trading on the Nasdaq under the ticker symbol RGLD. Thank you to everyone in Los Angeles and surrounding areas for joining us today. The playback for this Virtual Non-Deal Roadshow will be available on our website, twenty-four to forty-eight hours after this presentation under the VNDR Library tab. Please stay tuned for other presentations in your area, and see you next time.