Press Release Details

DENVER--(BUSINESS WIRE)-- Royal Gold, Inc. (NASDAQ: RGLD) (together with its subsidiaries, “Royal Gold” or the “Company,” “we” or “our”) reports net income attributable to stockholders (“net income”) of $20.4 million, or $0.32 per share, on revenue of $94.1 million in its fiscal fourth quarter ended June 30, 2016 (“fourth quarter”). Earnings increased 38% compared to the prior year quarter net income of $14.8 million, or $0.23 per share, on revenue of $73.6 million. The average gold price was $1,259 per ounce, up 6% from the prior year quarter.

Fourth Fiscal Quarter 2016 Highlights Compared to the Prior Year Quarter:

• Volume of 74,700 Gold Equivalent Ounces (“GEOs¹”), an increase of 21%
• Revenue of $94.1 million, an increase of 28%
• Reported earnings per share of $0.32, an increase of 38%
• Operating cash flow of $49.2 million, an increase of 12%
• Dividends paid of $15 million, an increase of 5%

Fiscal 2016 Highlights Compared to Fiscal 2015:

• Record volume of 308,000 GEOs², an increase of 36%
• Record revenue of $359.8 million, an increase of 29%
• Record dividends paid of $58.7 million, an increase of 5%

For the fiscal year ended June 30, 2016 (“fiscal 2016”), Royal Gold reports record revenue of $359.8 million, a 29% increase over $278.0 million in fiscal 2015. Fiscal 2016 earnings were impacted by impairments reported in the March 2016 quarter and discrete tax expenses reported in the September 2015 quarter resulting in a net loss attributable to stockholders of $77.1 million, or ($1.18) per share, compared to fiscal 2015 net income of $52.0 million, or $0.80 per share. Absent the adjustments for impairments and the discrete tax expenses, fiscal 2016 adjusted net income³ would have been $65.0 million, or $1.00 per share. The average gold price was $1,168 in fiscal 2016, down 5% from fiscal 2015.

“We made great progress in fiscal 2016 by enhancing our portfolio with four large transactions resulting in immediate contributions to our operating results from four new mines, including Pueblo Viejo, Andacollo, Wassa and Prestea,” commented Tony Jensen, President and CEO. “And fiscal 2017 is starting off strong with Centerra Gold’s agreement to acquire Thompson Creek Metals. In this new fiscal year, we look forward to a financially stronger Mount Milligan, construction progress at Rainy River and the Wassa and Prestea underground mines, and ongoing development at Cortez Crossroads to further grow and diversify our portfolio.”

Recent Developments

Mount Milligan Commitment Letter

On July 5, 2016, we signed a binding commitment letter with Centerra Gold Inc. (“Centerra”) describing key terms of a future amendment to the Company’s streaming interest at the Mount Milligan mine owned by Terrane Metals Corp. (“Terrane”), a subsidiary of Thompson Creek Metals Company Inc. (“Thompson Creek”). Centerra entered into a definitive arrangement agreement to acquire Thompson Creek and, in connection with closing that acquisition, will redeem all of Thompson Creek’s secured and unsecured notes.

Under the commitment letter, our 52.25% gold streaming interest at Mount Milligan will be amended to a 35% gold stream and we will obtain an 18.75% copper stream. We will continue to pay $435 per ounce of gold delivered and will pay 15% of the spot price per metric tonne of copper delivered. The amendment is conditioned upon closing of Centerra’s acquisition of Thompson Creek. Royal Gold estimates this amendment to be value neutral on a discounted cash flow basis, and expects about two-thirds of its future net revenue from Mount Milligan will be gold related and one-third copper related over the next ten years. After transition to the amended stream, Royal Gold expects that approximately 85% of our total net revenue will come from precious metals and 15% from base metals.⁴

Centerra’s proposed acquisition of Thompson Creek is subject to court and applicable regulatory approvals as well as approval of Thompson Creek shareholders, and is expected to close in the fall of calendar 2016.
_________________________________

1		GEOs are calculated as revenue divided by the average gold price for the same period. GEOs net of stream payments were 59,600 in the fourth quarter compared to 53,300 in the year-ago quarter.
2		GEOs net of stream payments were 247,300 for fiscal 2016, compared to 199,800 net GEOs in fiscal 2015.
3		Non-GAAP measure. See Schedule A for reconciliation.
4		Based on current projections for the next five years from operators where the Company has interests.

Fiscal 2016 Overview

Fiscal year 2016 revenue of $359.8 million included stream revenue of $238.0 million and royalty revenue of $121.8 million. Stream segment gold purchases totaled approximately 216,600 ounces of gold and sales were approximately 202,000 ounces of gold. Stream segment silver purchases were 532,600 ounces and sales were 208,900 ounces of silver. The Company had approximately 19,800 ounces of gold and 323,700 ounces of silver in inventory at June 30, 2016, as previously announced, compared to 5,300 ounces of gold at June 30, 2015.

The increase in fiscal 2016 revenue, compared to the fiscal year ended June 30, 2015, resulted primarily from higher production at Mount Milligan and new production from our recently acquired streams at the Wassa, Prestea, Pueblo Viejo and Andacollo mines.

Fiscal 2016 cost of sales was $71.0 million, compared to $33.5 million in fiscal 2015. The increase is primarily attributable to higher volume from our streaming segment. Cost of sales is specific to our stream agreements and results from the Company’s purchase of gold and silver for cash payments at a set contractual price, or a percentage of the prevailing market price of gold or silver when purchased.

General and administrative expenses increased to $31.7 million in fiscal 2016 compared to $24.9 million in fiscal 2015. The increase was primarily due to non-cash, stock-based compensation of approximately $4.9 million, resulting from management’s change in estimate for the number of performance shares that are expected to vest.

Depreciation, depletion and amortization expense increased to $141.1 million in fiscal 2016, compared to $93.5 million in fiscal 2015. The increase was primarily attributable to the ramp-up in production at Mount Milligan ($11.4 million) and new production from the recently acquired streams at Pueblo Viejo ($21.9 million), Wassa and Prestea ($7.8 million), and Andacollo ($9.0 million).

Exploration costs, which are specific to our Peak Gold joint venture in Alaska, increased to $8.6 million in fiscal 2016, compared to $2.2 million in fiscal 2015.

We recognized a fiscal 2016 income tax expense of $60.7 million compared to $9.6 million in fiscal 2015. The increase is primarily related to the gain attributable to the Company’s Andacollo transactions, the liquidation of our Chilean subsidiary, and impairment charges.

At June 30, 2016, we had current assets of $164.8 million compared to current liabilities of $22.7 million. This compares to current assets of $797.0 million and current liabilities of $25.0 million at June 30, 2015. The decrease in our current assets was primarily attributable to a decrease in our cash and equivalents resulting from the stream acquisitions completed early in the fiscal year.

The Company repaid $25 million on its revolving credit facility during the fourth quarter and as of June 30, 2016, had $375 million available and $275 million outstanding under the facility. Working capital, combined with the Company’s undrawn revolving credit facility, totaled $517.1 million in liquidity at June 30, 2016.

PROPERTY HIGHLIGHTS

A summary of fiscal 2016 fourth quarter and historical production can be found on Tables 1 and 2. Calendar year production estimates versus actual production at certain producing properties can be found on Table 3. Results of our streaming business for the three months and fiscal year ended June 30, 2016 compared to the three months and fiscal year ended June 30, 2015, can be found on Table 4. Highlights at certain of the Company’s principal producing and development properties during fiscal 2016, compared to fiscal 2015, are detailed in our Form 10-K.

CORPORATE PROFILE

Royal Gold is a precious metals stream and royalty company engaged in the acquisition and management of precious metal streams, royalties and similar production based interests. The Company owns interests on 193 properties on six continents, including interests on 38 producing mines and 24 development stage projects. Royal Gold is publicly traded on the NASDAQ Global Select Market under the symbol “RGLD.” The Company’s website is located at www.royalgold.com.

Note: Management’s conference call reviewing the fourth fiscal quarter results will be held Thursday, August 11, 2016 at 10:00 a.m. Mountain Daylight Time (noon Eastern Daylight Time) and will be available by calling (855) 209-8260 (U.S.), (855) 669-9657 (Canada) or (412) 542-4106 (international), conference title “Royal Gold.” The call will be simultaneously broadcast on the Company’s website at www.royalgold.com under the “Presentations” section. A replay of this webcast will be available on the Company’s website approximately two hours after the call ends.

Cautionary “Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: With the exception of historical matters, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projections or estimates contained herein. Such forward-looking statements include statements about operators’ expectations about development; anticipated production and returns from our stream and royalty properties, including without limitation Centerra’s proposed acquisition of Thompson Creek Metals Company, Centerra’s financial strength as proposed owner of Mount Milligan, estimated percentages of precious and base metals expected from Mount Milligan and from the Company’s stream and royalty portfolio in the aggregate after the proposed Mount Milligan stream agreement becomes effective; construction progress at Rainy River and at Wassa and Prestea and development at Cortez Crossroads; operators’ production estimates for calendar year 2016 and statements about the opportunities for portfolio and investment growth and diversification and the Company’s ability to pursue such opportunities. Factors that could cause actual results to differ materially from the projections include, among others, precious metals, copper and nickel prices; performance of and production at the Company's stream and royalty properties, including gold and copper production at Mount Milligan; the ability of operators of development properties to finance project construction to completion and bring projects into production as expected; operators’ delays in securing or inability to secure necessary governmental permits; decisions and activities of the operators of the Company's stream and royalty properties; unanticipated grade, environmental, geological, seismic, metallurgical, processing, liquidity or other problems the operators of the mining properties may encounter; changes in operators’ project parameters as plans continue to be refined; changes in estimates of reserves and mineralization by the operators of the Company’s stream and royalty properties; the failure of Centerra’s acquisition of Thompson Creek to occur; contests to the Company’s stream and royalty interests and title and other defects to the Company’s stream and royalty properties; errors or disputes in calculating stream and royalty payments, or payments not made in accordance with stream and royalty agreements; economic and market conditions; risks associated with conducting business in foreign countries; changes in laws governing the Company and its stream and royalty properties or the operators of such properties, and other subsequent events; as well as other factors described in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the Securities and Exchange Commission. Most of these factors are beyond the Company’s ability to predict or control. The Company disclaims any obligation to update any forward-looking statement made herein. Readers are cautioned not to put undue reliance on forward-looking statements.

Statement Regarding Third Party Information: Royal Gold does not own, develop or mine the properties on which it holds stream or royalty interests. Certain information provided in this press release, including production estimates for calendar 2016, has been provided to us by the operators of those properties or is publicly available information filed by these operators with applicable securities regulatory bodies, including the Securities and Exchange Commission. Royal Gold has not verified, and is not in a position to verify, and expressly disclaims any responsibility for, the accuracy, completeness or fairness of such third-party information and refers the reader to the public reports filed by the operators for information regarding those properties.

TABLE 1 Fourth Quarter Fiscal 2016 Revenue and Reported Production for Principal Royalty and Stream Interests (In thousands, except reported production in oz. and lbs.)
				Three Months Ended								Three Months Ended
				June 30, 2016								June 30, 2015
							Reported								Reported
Stream/Royalty		Metal(s)		Revenue			Production1					Revenue			Production1
Stream:
Mount Milligan		Gold		$	29,874		23,800		oz.			$	27,411		23,000		oz.
Andacollo		Gold		$	17,080		13,500		oz.				N/A		N/A
Pueblo Viejo		Gold		$	16,676		10,600		oz.				N/A		N/A
		Silver					208,900		oz.				N/A		N/A
Wassa and Prestea		Gold		$	5,791		4,600		oz.				N/A		N/A
Other		Gold		$	-		300		oz.				N/A		N/A
Total stream revenue				$	69,421							$	27,411
Royalty:
Peñasquito				$	2,552							$	10,369
		Gold					41,900		oz.						296,900		oz.
		Silver					2.6		Moz.						7.0		Moz.
		Lead					13.3		Mlbs.						48.2		Mlbs.
		Zinc					43.2		Mlbs.						88.9		Mlbs.
Voisey's Bay				$	-							$	3,021
		Nickel					N/A								9.0		Mlbs.
		Copper					N/A								20.8		Mlbs.
Holt		Gold		$	2,775		13,500		oz.			$	2,911		15,800		oz.
Cortez		Gold		$	1,267		16,100		oz.			$	3,283		43,900		oz.
Andacollo2		Gold			-		N/A		oz.			$	9,433		10,500		oz.
Other		Various			18,114		N/A					$	17,151		N/A
Total royalty revenue					24,708							$	46,168
Total Revenue					94,129							$	73,579

TABLE 1 Fiscal Year 2016 Revenue and Reported Production for Principal Royalty and Stream Interests (In thousands, except reported production in oz. and lbs.)
				Fiscal Year Ended								Fiscal Year Ended
				June 30, 2016								June 30, 2015
							Reported								Reported
Stream/Royalty		Metal(s)		Revenue			Production1					Revenue			Production1
Stream:
Mount Milligan		Gold		$	125,438		108,800		oz.			$	94,104		76,900		oz.
Andacollo		Gold		$	49,243		41,600		oz.				N/A		N/A
Pueblo Viejo		Gold		$	39,683		31,200		oz.				N/A		N/A
		Silver					208,900		oz.				N/A		N/A
Wassa and Prestea		Gold		$	23,346		20,100		oz.				N/A		N/A
Other		Gold		$	318		300		oz.				N/A		N/A
Total stream revenue				$	238,028							$	94,104
Royalty:
Peñasquito				$	22,760							$	30,306
		Gold					584,000		oz.						742,100		oz.
		Silver					21.4		Moz.						24.6		Moz.
		Lead					134.2		Mlbs.						158.4		Mlbs.
		Zinc					333.0		Mlbs.						340.8		Mlbs.
Voisey's Bay				$	11,044							$	16,665
		Nickel					78.6		Mlbs.						62.8		Mlbs.
		Copper					56.2		Mlbs.						64.8		Mlbs.
Holt		Gold		$	10,295		58,300		oz.			$	11,954		61,500		oz.
Cortez		Gold		$	6,107		74,000		oz.			$	18,044		229,000		oz.
Andacollo2		Gold		$	-		-		oz.			$	38,033		41,500		oz.
Other		Various		$	71,556		N/A					$	68,913		N/A
Total royalty revenue				$	121,762							$	183,915
Total Revenue				$	359,790							$	278,019

TABLE 2 Historical Production

Reported Production For The Quarter Ended1

Property

Stream/Royalty

Operator

Metal(s)

Jun. 30, 2016

Mar. 31, 2016

Dec. 31, 2015

Sep. 30, 2015

Jun. 30, 2015

Stream:

Mount Milligan

52.25% of payable gold

Thompson Creek

Gold

23,800

oz.

25,400

oz.

38,700

oz.

21,000

oz.

23,000

oz.

Andacollo

100% of gold produced

Teck

Gold

13,500

oz.

13,500

oz.

5,200

oz.

9,500

oz.

N/A

Pueblo Viejo

7.5% of gold produced up to 990,000 ounces; 3.75% thereafter

Barrick (60%)

Gold

10,600

oz.

11,800

oz.

8,800

oz.

N/A

N/A

75% of payable silver up to 50 million ounces; 37.5% thereafter

Silver

208,900

oz.

N/A

N/A

N/A

N/A

Wassa and Prestea

9.25% of gold produced up to 12/31/17; 10.5% of gold produced up to 240,000 ounces; 5.5% thereafter

Golden Star

Gold

4,600

oz.

3,500

oz.

8,800

oz.

3,200

oz.

N/A

Royalty:

Peñasquito

2.0% NSR

Goldcorp

Gold

41,900

oz.

120,300

oz.

195,400

oz.

226,500

oz.

296,900

oz.

Silver

2.6

Moz.

4.8

Moz.

6.8

Moz.

7.3

Moz.

7.0

Moz.

Lead

13.3

Mlbs.

30.2

Mlbs.

41.7

Mlbs.

49.1

Mlbs.

48.2

Mlbs.

Zinc

43.2

Mlbs.

73.1

Mlbs.

98.0

Mlbs.

118.7

Mlbs.

88.9

Mlbs.

Cortez

GSR1 and GSR2, GSR3, NVR1

Barrick

Gold

16,100

oz.

18,400

oz.

17,000

oz.

22,600

oz.

43,900

oz.

Holt

0.00013 x quarterly average gold price

Kirkland Lake Gold

Gold

13,500

oz.

13,500

oz.

15,000

oz.

16,300

oz.

15,800

oz.

Voisey's Bay

2.7% NSR

Vale

Nickel

N/A

17.2

Mlbs.

23.6

Mlbs.

37.8

Mlbs.

9.0

Mlbs.

Copper

N/A

39.2

Mlbs.

15.2

Mlbs.

1.7

Mlbs.

20.8

Mlbs.

Andacollo2

75%

Teck

Gold

N/A

N/A

N/A

N/A

10,500

oz.

FOOTNOTES
Tables 1 and 2
1		Reported production relates to the amount of metal sales that are subject to our royalty and stream interests for the stated period, as reported to us by operators of the mines.
2		This royalty was terminated effective July 1, 2015.

TABLE 3 Calendar 2016 Operators’ Production Estimate vs Actual Production
		Calendar 2016 Operator’s Production Estimate1							Calendar 2016 Operator's Production
									Actual2,3
		Gold		Silver		Base Metals			Gold		Silver				Base Metals
Stream/Royalty		(oz.)		(oz.)		(lbs.)			(oz.)		(oz.)				(lbs.)
Stream:
Andacollo4		57,600		-		-			25,300		-				-
Mount Milligan5		240,000-270,000		-		-			99,700		-				-
Pueblo Viejo6		600,000-650,000		Not provided					321,900		Not provided				-
Wassa and Prestea7		180,000-205,000							95,700
Royalty:
Cortez GSR1		119,200		-		-			31,800		-				-
Cortez GSR2		1,300		-		-			2,700		-				-
Cortez GSR3		120,500		-		-			34,400		-				-
Cortez NVR1		68,900		-		-			23,700		-				-
Penasquito8		520,000-580,000		22-24 million		-			161,000		7.8 million				-
Lead						145-155 million									46.1		million
Zinc						375-400 million									109.4		million

1		Production estimates received from our operators are for calendar 2016. There can be no assurance that production estimates received from our operators will be achieved. Please refer to our cautionary language regarding forward-looking statements preceding Table 1 above, as well as the Risk Factors identified in Part I, Item 1A, of our Fiscal 2015 10-K for information regarding factors that could affect actual results.
2		Actual production figures shown are for the period January 1, 2016 through June 30, 2016, unless otherwise noted.
3		Actual production figures for Andacollo and Cortez are based on information provided to us by the operators, and actual production figures for Andacollo, Mount Milligan, Peñasquito (gold), and Wassa and Prestea are the operators’ publicly reported figures.
4		The estimated and actual production figures shown for Andacollo are contained gold in concentrate.
5		The estimated and actual production figures shown for Mount Milligan are payable gold in concentrate.
6		The estimated and actual production figures shown are payable gold in doré and represent Barrick’s 60% interest in Pueblo Viejo.
7		The estimated production figure shown is payable gold in doré.
8		The estimated gold and silver production figures reflect payable gold and silver in concentrate and doré, while the estimated lead and zinc production figures reflect payable metal in concentrate.

TABLE 4 Stream Summary

Three Months Ended June 30, 2016

Three Months Ended June 30, 2015

As of June 30, 2016

As of June 30, 2015

Gold Stream

Purchases (oz.)

Sales (oz.)

Purchases (oz.)

Sales (oz.)

Ounces in inventory

Ounces in inventory

Mount Milligan

31,200

23,700

21,400

23,000

7,500

5,300

Pueblo Viejo

11,000

11,000

N/A

N/A

11,000

N/A

Andacollo

13,500

13,500

N/A

N/A

-

N/A

Wassa and Prestea

4,400

4,600

N/A

N/A

1,300

N/A

Phoenix Gold

-

-

N/A

N/A

-

N/A

Total

60,100

52,800

21,400

23,000

19,800

5,300

Three Months Ended June 30, 2016

Three Months Ended June 30, 2015

As of June 30, 2016

As of June 30, 2015

Silver Stream

Purchases (oz.)

Sales (oz.)

Purchases (oz.)

Sales (oz.)

Ounces in inventory

Ounces in inventory

Pueblo Viejo

322,800

208,900

N/A

N/A

323,700

N/A

Fiscal Year Ended June 30, 2016

Fiscal Year Ended June 30, 2015

As of June 30, 2016

As of June 30, 2015

Gold Stream

Purchases (oz.)

Sales (oz.)

Purchases (oz.)

Sales (oz.)

Ounces in inventory

Ounces in inventory

Mount Milligan

111,000

108,800

74,400

76,900

7,500

5,300

Pueblo Viejo

42,200

31,200

N/A

N/A

11,000

N/A

Andacollo

41,700

41,600

N/A

N/A

-

N/A

Wassa and Prestea

21,400

20,100

N/A

N/A

1,300

N/A

Phoenix Gold

300

300

N/A

N/A

-

N/A

Total

216,600

202,000

74,400

76,900

19,800

5,300

Fiscal Year Ended June 30, 2016

Fiscal Year Ended June 30, 2015

As of June 30, 2016

As of June 30, 2015

Silver Stream

Purchases (oz.)

Sales (oz.)

Purchases (oz.)

Sales (oz.)

Ounces in inventory

Ounces in inventory

Pueblo Viejo

532,600

208,900

N/A

N/A

323,700

N/A

ROYAL GOLD, INC. Consolidated Balance Sheets As of June 30, (In thousands except share data)
			2016			2015
ASSETS
Cash and equivalents		$	116,633		$	742,849
Royalty receivables			17,990			37,681
Income tax receivable			20,043			6,422
Stream inventory			9,489			2,287
Available-for-sale securities			-			6,273
Prepaid expenses and other			614			1,511
Total current assets			164,769			797,023
Stream and royalty interests, net			2,848,087			2,083,608
Other assets			53,696			36,560
Total assets		$	3,066,552		$	2,917,191
LIABILITIES
Accounts payable		$	4,114		$	4,911
Dividends payable			15,012			14,341
Other current liabilities			3,554			5,721
Total current liabilities			22,680			24,973
Debt			600,685			313,869
Deferred tax liabilities			133,867			146,603
Uncertain tax positions			16,996			15,130
Other long-term liabilities			6,439			689
Total liabilities			780,667			501,264
Commitments and contingencies
EQUITY
Preferred stock, $.01 par value, authorized 10,000,000 shares authorized; and 0 shares issued			-			-
Common stock, $.01 par value, 100,000,000 shares authorized; and 65,093,950 and 65,033,547 shares outstanding, respectively			651			650
Additional paid-in capital			2,179,781			2,170,643
Accumulated other comprehensive loss			-			(3,292	)
Accumulated earnings			48,584			185,121
Total Royal Gold stockholders’ equity			2,229,016			2,353,122
Non-controlling interests			56,869			62,805
Total equity			2,285,885			2,415,927
Total liabilities and equity		$	3,066,552		$	2,917,191

ROYAL GOLD, INC. Consolidated Statements of Operations and Comprehensive (Loss) Income (In thousands except for per share data)
		For The Three Months Ended									For The Years Ended
		June 30,				June 30,					June 30,				June 30,
			2016				2015					2016				2015
Revenue		$	94,129			$	73,579				$	359,790			$	278,019
Costs and expenses
Cost of sales			19,019				9,998					70,979				33,450
General and administrative			8,305				6,671					31,720				24,873
Production taxes			432				1,091					3,978				5,446
Exploration Costs			2,466				2,038					8,601				2,194
Depreciation, depletion and amortization			35,391				26,213					141,108				93,486
Impairment of stream and royalty interests and royalty receivables			-				-					98,588				31,335
Total costs and expenses			65,613				46,011					354,974				190,784
Operating income			28,516				27,568					4,816				87,235
Gain (loss) on available-for-sale securities			1,665				(183	)				2,340				(183	)
Interest and other income			1,582				178					3,711				883
Interest and other expense			(8,656	)			(6,196	)				(32,625	)			(25,691	)
Income (loss) before income taxes			23,107				21,367					(21,758	)			62,244
Income tax expense			(5,025	)			(6,394	)				(60,680	)			(9,566	)
Net income (loss)			18,082				14,973					(82,438	)			52,678
Net loss (income) attributable to non-controlling interests			2,357				(154	)				5,289				(713	)
Net income (loss) attributable to Royal Gold common stockholders		$	20,439			$	14,819				$	(77,149	)		$	51,965
Net income (loss)		$	18,082			$	14,973				$	(82,438	)		$	52,678
Adjustments to comprehensive income (loss), net of tax
Unrealized change in market value of available-for-sale securities			1,112				689					5,632				(3,292	)
Reclassification adjustment for (gains) losses included in net income (loss)			(1,665	)			167					(2,340	)			160
Comprehensive income (loss)			17,529				15,829					(79,146	)			49,546
Comprehensive income attributable to non-controlling interests			2,357				154					5,289				(713	)
Comprehensive income (loss) attributable to Royal Gold stockholders		$	19,886			$	15,675				$	(73,857	)		$	48,833
Net income (loss) per share available to Royal Gold common stockholders:
Basic earnings (loss) per share		$	0.32			$	0.23				$	(1.18	)		$	0.80
Basic weighted average shares outstanding			65,090,772				65,033,547					65,074,455				65,007,861
Diluted earnings (loss) per share		$	0.32			$	0.23				$	(1.18	)		$	0.80
Diluted weighted average shares outstanding			65,090,772				65,129,362					65,074,455				65,125,173
Cash dividends declared per common share		$	0.23			$	0.22				$	0.91			$	0.87

ROYAL GOLD, INC. Consolidated Statements of Cash Flows (In Thousands)
		For The Three Months Ended								For The Years Ended
		June 30,				June 30,				June 30,				June 30,
			2016				2015				2016				2015
Cash flows from operating activities:
Net income (loss)		$	18,082			$	14,973			$	(82,438	)		$	52,678
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization			35,391				26,213				141,108				93,486
Impairment of stream and royalty interests			-				-				98,588				31,335
Amortization of debt discount and issuance costs			4,843				3,088				12,985				12,100
Non-cash employee stock compensation expense			2,250				1,481				10,039				5,141
Tax benefit of stock-based compensation exercises			301				(290	)			548				(364	)
(Gain) loss on available-for-sale securities			(1,665	)			183				(2,340	)			183
Deferred tax benefit			12,263				6,548				(4,983	)			(27,651	)
Other			-				(46	)			(390	)			(46	)
Changes in assets and liabilities:
Royalty receivables			2,245				1,805				17,221				5,977
Stream inventory			(4,088	)			675				(7,203	)			1,110
Income taxes receivable			(11,181	)			(9,666	)			(14,177	)			15,525
Prepaid expenses and other assets			(1,783	)			(121	)			(153	)			2,527
Accounts payable			684				1,892				(849	)			150
Foreign withholding taxes payable			-				1				(199	)			(2,000	)
Uncertain tax positions			(83	)			(331	)			1,867				1,405
Other liabilities			(8,047	)			(2,500	)			235				543
Net cash provided by operating activities		$	49,212			$	43,905			$	169,859			$	192,099
Cash flows from investing activities:
Acquisition of royalty and stream interests			(19,853	)			(88	)			(1,346,109	)			(60,429	)
Andacollo royalty termination			-				-				345,000				-
Golden Star term loan			-				-				(20,000	)			-
Proceeds from sale of available-for-sale securities			4,972				-				11,905				-
Tulsequah stream termination			-				-				-				10,000
Other			(7	)			(702	)			(309	)			(773	)
Net cash used in investing activities		$	(14,888	)		$	(790	)		$	(1,009,513	)		$	(51,202	)
Cash flows from financing activities:
Borrowings from revolving credit facility			-				-				350,000				-
Repayment of revolving credit facility			(25,000	)			-				(75,000	)			-
Net (payments) proceeds from issuance of common stock			(179	)			-				(353	)			775
Common stock dividends			(15,011	)			(14,342	)			(58,720	)			(56,054	)
Debt issuance costs			(62	)			(864	)			(1,111	)			(864	)
Distribution to non-controlling interests			(1	)			(578	)			(830	)			(1,805	)
Tax (benefit) expense of stock-based compensation exercises			(301	)			290				(548	)			364
Net cash (used in) provided by financing activities		$	(40,554	)		$	(15,494	)		$	213,438			$	(57,584	)
Net (decrease) increase in cash and equivalents			(6,230	)			27,621				(626,216	)			83,313
Cash and equivalents at beginning of period			122,863				715,228				742,849				659,536
Cash and equivalents at end of period		$	116,633			$	742,849			$	116,633			$	742,849

SCHEDULE A

Non-GAAP Financial Measures

Non-GAAP financial measures are intended to provide additional information only and do not have any standard meaning prescribed by generally accepted accounting principles (GAAP). These measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

Our management uses Adjusted EBITDA and Adjusted Net Income as measures of operating performance to assist in comparing performance from period to period on a consistent basis; as a measure for planning and forecasting overall expectations and for evaluating actual results against such expectations; in communications with the board of directors, stockholders, analysts and investors concerning our financial performance; as useful comparisons to the performance of our competitors; and as metrics of certain management incentive compensation calculations. We believe that these measures are used by and are useful to investors and other users of our financial statements in evaluating our operating performance because they provide an additional tool to evaluate our performance without regard to special and noncore items, which can vary substantially from company to company depending upon accounting methods and book value of assets and capital structure. We have provided reconciliations of all non-GAAP measures to their nearest U.S. GAAP measures and have consistently applied the adjustments within our reconciliations in arriving at each non-GAAP measure. We consider these items to be necessary adjustments for purposes of evaluating our ongoing business performance and are often considered non-recurring. Such adjustments are subjective and involve significant management judgment.

Adjusted EBITDA Reconciliation

Adjusted EBITDA is defined by the Company as net income (loss) plus depreciation, depletion and amortization, non-cash charges, income tax expense, interest and other expense, and any impairment of mining assets, less non-controlling interests in operating loss (income) of consolidated subsidiaries, interest and other income, and any royalty portfolio restructuring gains or losses. Other companies may define and calculate this measure differently. Adjusted EBITDA identifies the cash generated in a given period that will be available to fund the Company's future operations, growth opportunities, shareholder dividends and to service the Company's debt obligations. This information differs from measures of performance determined in accordance with U.S. generally accepted accounting principles (“GAAP”) and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP. See the table below for a reconciliation of net income to Adjusted EBITDA.

		For The Three Months Ended							For The Years Ended
		June 30,							June 30,
			2016			2015				2016				2015
Net income (loss)		$	18,082		$	14,973			$	(82,438	)		$	52,678
Depreciation, depletion and amortization			35,391			26,213				141,108				93,486
Non-cash employee stock compensation			2,250			1,481				10,039				5,141
Impairment of stream and royalty interests and royalty receivables			-			-				98,588				31,335
Interest and other, net			5,409			6,201				26,574				24,992
Income tax expense			5,025			6,394				60,680				9,566
Non-controlling interests in operating loss (income) of consolidated subsidiaries			2,357			(108	)			5,289				(666	)
Adjusted EBITDA		$	68,514		$	55,154			$	259,840			$	216,532

Adjusted Net Income (Loss) Reconciliation

Management of the Company uses adjusted net income (loss) to evaluate the Company’s operating performance, and for planning and forecasting future business operations. The Company believes the use of adjusted net income (loss) allows investors and analysts to understand the results relating to receipt of revenue from its royalty interests and purchase and sale of gold from its streaming interests by excluding certain items that have a disproportionate impact on our results for a particular period. The net income (loss) adjustments are presented net of tax generally at the Company’s statutory effective tax rate. Management’s determination of the components of adjusted net income (loss) are evaluated periodically and based, in part, on a review of non-GAAP financial measures used by mining industry analysts. Net income (loss) attributable to Royal Gold stockholders is reconciled to adjusted net income (loss) as follows:

		For The Three Months Ended						For The Years Ended
		June 30,						June 30,
			2016			2015			2016				2015
Net income (loss) attributable to Royal Gold common stockholders		$	20,439		$	14,819		$	(77,149	)		$	51,965
Impairment of stream and royalty interests and royalty receivables, net of tax			-			-			86,130				24,185
Tax expense on Andacollo royalty sale and Chilean subsidiary liquidation			-			-			56,000				-
Adjusted net income attributable to Royal Gold common stockholders		$	20,439		$	14,819		$	64,981			$	76,150
Adjusted earnings per share		$	0.32		$	0.23		$	1.00			$	1.17

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Source: Royal Gold, Inc.