Good morning ladies and gentlemen, and welcome to the Osisko Gold Royalties' Second Quarter 2016 Results Conference Call. After the presentation, we will conduct a question-and-answer session. [Operator Instructions] Please note that this call is being recorded today, August 4, 2016 at 16:30 Eastern Standard Time. I would now like to turn the meeting over to our host for today's call, Mr. Sean Roosen, Chair of the Board of Directors and Chief Executive Officer of Osisko Gold Royalties. [Foreign Language]

[Foreign Language] I'm going to be referring to a Power Point that's located on our website. That is titled 2016 Q2 results. [Foreign Language] We raised in the first 24 months over the existence of Osisko Gold Royalties, $500 million in capital. We secured $200 million of available credit has not been drawn down. We've successfully established are given a royalty model which involves the investment and evolution of development and exploration companies through both equity and wealthy purchases. We've continue to have success in our equity portfolios which is now growing to a total value $171.8 million representing $66.9 million of unrealized gains at June 30, 2016. So pretty successful portion of our program. We deployed $212 million of capital into new investments and we grew out of the portfolio to a total of 52 royalties and three royalty options. We've also been able to declare 8 dividend as of this quarter, and the total of $26.6 million of dividends as of this quarter. So a lot of our objectives have been met and in some cases we would exceed them. On the page five; we've seen our cash -- net cash flow growth from $6.5 million in Q2 of 2015 to $15 million for the second quarter of 2016 and representing a 133% increase in our cash flow. Revenues also increased from $10.2 million to $15.8 million, representing a 54% increase in gross revenue. In terms of our goal deliveries and reception, one thing to make note of is that we receive 100% royalty gold, i.e. that is zero cost gold to us. So it's quite a bit more important; [ph] just a normal stream and we've seen our gold received for Q2 at 9,488 ounces, up from 6,887 in 2015. Also for the year 2016, year-to-date we've…

[Foreign Language] Your first question considering from Dan Rollins from RBC Capital Market. Please go ahead with your question.

I got, I hadn’t mute there. I'm won just wondering -- confronts on an Air New around there just the first two years just wanted to talk about what you're seeing from the pipeline opportunity. You did start-off your comments by talking about the funds that you have raised and that you have most of those funds still on the balance sheet. And then I known you did the last second to raise it was sort of to get a seat at the table with some of the bigger chunkier deals. Do you see the opportunity out there on those big chunky deals right now or do you see at the earlier stage opportunities more creative right now?

Obviously there is a couple of deals wrenched in the space, recently we are involved in a lot of processes right now Dan, and hopefully we'll continue to work on those. And they've evolved and there is a significant amount of balance sheet debt conversion going on in this space that creates probably more opportunity than the usual one, and as we've said before, we are just participant at those tables, we did raise funds as you said in Q1 which allows us to bid upto a $500 million project without having to come back to market or be subject to conditions. So that's where we want to be that's where we are. And hopefully will come back to you with some form of success on those bigger projects as we get into it. We are seeing in the pipeline -- on the project development size as more projects are starting to consider production decisions. So we're being involved in those and we're also seeing some deal flow in terms of the asset disposal processes that are going on where people are using royalty extreme participants to be part of the acquisition financing processes. So again we're -- we're seeing a lots of work going on and hopefully we'll be back to market with something as these processes unfold.

And then, with respect to the Horn Five, when do you think you would be in a position to have something negotiated with Falco on that transaction -- I know there is bit of a window where you can negotiate a deal but when do you think realistically you would have something pen to paper?

Are you referring to the royalty or you're -- as you know, the PA study came out, there is discussions with our partners at Glencore to evolve and try and feasibility study out by the first half of next year. So in the context of that feasibility and heading into permitting, that is when we when we would forsee that happening. Once we get a feasibility in hand, we're in the permitting process; we will be pushing hard to line up the project financing to help Falco achieve success there with our partners going forward.

And maybe if you could just touch base -- I know as we roll into early '17, I believe the agreement you had with -- on the Virginia exploration properties, I do believe expires. Where do stand with starting to monetize on the exploration portfolio that you did bring in with the Virginia acquisition?

You're quite right, Dan, we have a three-year commitment there. Our evolution here in Quebec, we continue to refine and take advantage of the talent pool that we have with our teams here. There is quite a bit of value here in Quebec on those assets. We're not quite ready to finalize our plans on that portion of our asset base at present but we are working to get that back to them with a refinement on how we're going to proceed there. Obviously our intent is to create a very sustainable business on the James Bay assets and continue to take advantage of the hard work that Andrew [ph], Paul Archer and the team; Virginia team put in there anyhow to make sure that they have continued support to hopefully create the same success as they've had in the past, discovery of Éléonore. And there is nobody else out there really has that knowledge base or the land package to continue. So we see that as a significant asset within the company and we want to make sure that we get the best we can before shareholders.

Thanks very much.

Your next question comes from the line of Kara Hassan [ph] from Hayward Securities. Please go ahead.

Thank you, and afternoon gentleman. Just a quick question on the equity -- I mean you demonstrated in the presentation some of the examples were -- you've had significant increases in your equity value and previously have talked about ways that you could monetize that component of your portfolio. How are you feeling given where we are in the precious metals environment and some of the wins you've had in our portfolio on how you approach that over the next year?

I think for the most part -- the equity positions that we hold are strategic in nature. We continue to believe that those assets have growth in them, and we see occasions where we sell out when we say there is some profit to be taken but the goal of the portfolio originally was to be strategic but we are opportunistic as well. So in some cases we have monetized positions and we've been able to demonstrate that. In terms of what you'll see in the quarterly reports we did have about $4.3 million of gains through the sale of equities for the quarter. So we like that portion of our portfolio, we have an unrealized gain of about $67 million overall, and we continue to think that. The due diligence work that we do in our Cisco gold royalties life also allows us to be reasonably good steward of equity investments which we do when we feel we have all of our ducks in a row in terms of seeing a potential wealthier streaming opportunity. So we think that that's a very good portion of our business, and a good catalyst to perhaps get us into situations where we can earn royalty sooner rather than later in the process, and are hopefully at a better valuation than the bank run processes. So that continues to be strategic to us and our equity portfolio is a catalyst in that process.

Okay. And just on the G&A side, obviously bit higher this quarter with share based comp but outside of that when should we expect to see that G&A reduce as you sort of push some of those cost down to the portfolio company?

I think by the end of this year we'll have a fair amount of restructuring in place. As you know, we've entered into agreements in Q1 and Q2 to allocate some of our technical and administrative people into projects -- that portion of the business; I'm very satisfied with the progress we're making there. We had given that guidance in the market that we needed a couple of years to get going. And I think that the activities that we were able to achieve in Q1 and Q2, where we had but $5 million or $6 million of G&A that will be offset to our investors as we provided services and people to make those happen. So we are on-track and I've been very happy with the process that we're in, and as the ability to have our people go and help unlock value in those companies.

Perfect, thanks.

[Operator Instructions] [Foreign Language] Your next question comes from the line John Shvadnik [ph] from DataBanc Capital Markets. Please go ahead.

Hi, thanks and just one more. Just wondering what your ideal capital structure would debt you might take on in final state?

We want to maintain our profile in the space; we've got a previous dividend yield now. So we want to maintain that capacity to -- to very least BC maintain our dividend profile if not be able to increase it. In terms of debt, we've not been historically -- we haven't run higher levels of debt in companies that we're involved in right now and I don't see why I would change. So I think that we would probably keep our debt levels in the sort of the $200 million to $300 million range, it would be the max to be comfortable with who we're deploying into something sizeable. They are $200 million to $500 million but we want to make sure that we have a sustainable business and that we can weather all commodity prices.

Fair enough, that's great. That's all for me, thanks.

Your next question comes from the line of Cosmos Shue [ph] from CIBC. Please go ahead.

Hi Sean, and thanks for hosting this quarter. Just one quick question for me, can you remind me once again of the tax status of the company. Are you paying cash taxes or did you pay any taxes in Q2? I'm just seeing the entire tax expense has added to calculate cash flow.

Yes, through our back pools and our investment into flow-through investments, we have not paid cash taxes today.

Okay. And Sean, when would you expect to pay cash taxes?

Well, you know it depends on how it played out but right now we wouldn't pay anything in 2016 and we'll be looking to reorganize for 2017 and address the issues that come out of that.

Okay, great, thanks. That's all.

There are no further questions at this time. I turn the call back over to the presenters. Thank you. I know some people didn't get their questions but we are running out of schedule time, but thank everybody and we'll look forward to seeing you either at one of the Investment Conferences or at the next quarterly call.

This concludes today's conference call. You may now disconnect. [Foreign Language]