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Royal Gold (RGLD) Provides Updates on Operations for Q3

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Royal Gold, Inc. RGLD has provided an update on third-quarter fiscal 2018 (ended Mar 31, 2018) operations. During the quarter, RGLD Gold AG, the fully-owned subsidiary of Royal Gold, sold roughly 63,000 gold equivalent ounces consisting of roughly 49,000 gold ounces, 272,000 silver ounces and 2,000 tons of copper related to its streaming agreements. The company ended the quarter with 26,000 ounces of gold and 659,000 ounces of silver, highlighting a sequential increase owing to late received deliveries.

Average realized prices of gold and silver were $1,328 and $16.77 per ounce sold compared with the prior-quarter figures of $1,272 and $16.79, respectively. Average realized copper prices were $6,902 per ton compared with $6,746 in the prior-year quarter.

In the fiscal third quarter, cost of sales was roughly $342 per gold equivalent ounce, up from prior-quarter figure of $319. The cost of sales is based on the quarterly average silver-gold ratio of roughly 79 to 1 and gold-copper ratio of around 0.19 ton per ounce.

Royal Gold’s fiscal third-quarter deliveries were not impacted by the temporary shutdown of the mill processing facility at Mount Milligan occurring in early calendar 2018. However, the company expects this shutdown to impact its mid-calendar 2018 results as some of the gold and copper deliveries expected in June through August will be deferred to a later date.

During the fiscal third quarter, Royal Gold paid back $75 million of the outstanding balance amount on its revolving credit facility. As of Mar 31, 2018, the revolver had $75 million outstanding, which translates into available revolver capacity of $925 million.

Shares of Royal Gold have moved up 2.2% over the past three months, outperforming the industry’s 10.9% decline.

Zacks Rank & Stocks to Consider

Royal Gold currently carries a Zacks Rank #3 (Hold).

Some stocks worth considering in the basic materials space are ArcelorMittal MT, Daqo New Energy Corp. DQ and CF Industries Holdings, Inc. CF, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

ArcelorMittal has an expected long-term earnings growth rate of 13.4%. Its shares have soared 45.1% over a year.

Daqo New Energy has an expected long-term earnings growth rate of 7%. Its shares have rallied a whopping 220% over a year.

CF Industries has an expected long-term earnings growth rate of 6%. Its shares have gained 30.2% over a year.

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