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Royal Gold swings to FY'18 loss, books record revenue

Royal Gold Inc. said Aug. 8 that it swung to an attributable net loss of US$113.1 million, or US$1.73 per share, for its full fiscal 2018, from a profit of US$101.5 million, or US$1.55 per share, a year ago.

Earnings were hurt by a US$239.1 million noncash impairment related to the Pascua-Lama mine in Argentina.

Revenue for the period increased 4% to a record high of US$459.0 million, with operating cash flow also setting a record high of US$328.8 million, representing a 23% increase.

Gold equivalent volume set a new record for the year of 354,000 ounces, a 1% uptick yearly. Cost of sales slid to approximately US$83.8 million, from US$87.3 million in fiscal 2017, primarily due to lower gold sales from the Mount Milligan mine in British Columbia and Teck Resources Ltd.'s Andacollo mine in Chile.

The company declared a dividend of 25 cents, up from 24 cents a year ago, bringing total dividends in the fiscal year to 99 cents, from 95 cents in the 2017 fiscal year.

For the fourth quarter, net income rose to US$26.7 million, or 41 cents per share, up from US$20.0 million, or 31 cents per share, a year earlier.

Revenue for the Denver-based precious metals stream and royalty company increased yearly to US$116.2 million, from US$108.9 million.

Cost of sales during the three months ended June 30 rose to US$22.2 million, from US$19.7 million in the prior year quarter, driven by a higher gold and silver sales portfolio.

Gold equivalent volume increased 3% yearly to 89,000 ounces, comprising of 22,000 ounces of gold and 573,000 ounces of silver. This reflected a slight inventory drawdown from the previous quarter, offsetting the deferral of deliveries from Centerra Gold Inc.'s Mount Milligan due to a temporary shutdown.