Good morning, ladies and gentlemen, and welcome to the Osisko Gold Royalties Q4 2022 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, February 24, 2023 at 10:00 AM Eastern Time. Today on the call, we have Mr. Sandeep Singh, President and Chief Executive Officer; and Mr. Frederic Ruel, Chief Financial Officer and Vice President, Finance. I would now like to turn the meeting over to our host for today's call, Mr. Sandeep Singh. [Foreign Language]

Thanks very much, Joel, and thanks to everyone on the line with us this morning. Look forward to walking you through a very exciting quarter and a very exciting year for us. In 2022, as I do, I will be referring to a presentation on our website. If you haven't picked it up already on the main page, just on the left hand side, if you hit Q4 in 2022 results, it will take you to it. And I'll be referring to page numbers as I go along, obviously making some forward-looking statements or urge you to review that disclaimer on Slide 2. So looking at Slide 3, I’ll (ph) start. As I said, 2022 was a very important -- I'd say frankly pivotal year for us. We made significant strides on a number of fronts, that may have listed on this page. If we start with the simplification, the ongoing simplification of our business, 2022 in particular, the third quarter took a massive leap forward with the deconsolidation of our financials with Osisko Development Corp., the -- just an accounting issue, but it wasn't a meaningful one of kind of combining a company that generates cash flow all day long and one that is advancing its projects and investing in the future of the growth, just didn't leave a recognizable entity. So happy to have that situation behind us. In terms of the portfolio of assets, our asset base continues to strengthen. We had three consecutive record quarters on most of the things that matter to us from a royalty company perspective and we'll talk about what the outlook looks for -- looks like for us as we move forward. We also reset the balance sheet. And in spring of last year, I think we reset the balance sheets…

Thank you, Sandeep. [Foreign Language] Good morning. Thank you for joining us today. Let's start with some highlights on Page 15 of the presentation. So, as discussed record 89,367 (ph) GEOs in 2022, an increase of 12% over 2021. We had record revenues from royalties and streams of $218 million compared to $200 million in 2021, which translated into record cash flows from operations of $175 million compared to $153 million in 2021, which is a 14% increase. Our cash margin was stable at 93%. We have increased our accordion feature of the revolving credit facility. We have extended the maturity date as well to September 2026. We have repaid our converts at the end of December, using $150 million from our cash balance and we drew the remaining $115 million from our credit facility. We've also repurchased 1.7 million shares in 2022 at an average price of $13. On Page 16, we present our GEOs by asset and by commodity, gold represented 69% of our GEOs in 2022, silver 19%, and diamonds and other commodities, 12%. On Page 17, we present the growth in our revenues from royalties and streams and the growth in our operating cash flows compared to -- 2022 compared to 2021. If we move to Page 18. Net earnings from our royalty and streaming business were $85.3 million or $0.47 per share compared to $76.6 million or $0.46 per share in 2021. Adjusted earnings amounted to $111 million or $0.62 per share compared to $94.4 million or $0.56 per share in 2021, of course, 2022 was an annual record. On Page 19, we have a summary of our quarterly and annual results, including 25,000 GEOs for the fourth quarter for a total of over 89,000 as previously mentioned, compared to 80,000 GEOs in 2021. Gross…

Yeah. Thanks. Thanks, Fred. And maybe just the last thing, I would point out on those last two slides that Fred alluded to. On '22, worth noting that we still have to fund the CSA transaction hasn't closed yet. So that will come off our credit facility, depending on how much of that deal we take, certainly, the silver, but depending on the copper. But nonetheless, our balance sheet remains exceptionally strong, have a lot of firepower at the right time on the credit facility still, to our cash flow, which was meaningful last year depending on gold price should grow this year quite substantially, and then the equity book as well, which is less liquid, but we certainly want to make some inroads on this year and we think that's very much achievable. So when you look at Slide 23, we think we have the right mix. We've got meaningfully or credibly senior scale assets. We focused and we will continue to focus on high-asset quality. We're going to maintain the level of consistency. You've seen from us level of simplicity and we're going to allow our assets work and that organic growth that we talked about and let it unfold. That said, we see things we'd like, that we sourced ourselves, we will have the conviction to fall through with them. And as I said, we have the balance sheet to do it. And if we don't, we'll remain completely disciplined. It's a pretty simple formula for us. But one that I think unlocks a significant amount of value. If you look at the bottom of the slide and I think if we stay focused on what I just described to you at the bottom of the slide, frankly takes care of itself because this is a portfolio is too important. We're doing the right things with it. And if you look at how the sector as a whole, I think is fair to say is, challenged for growth and struggling for growth. I think we've got the right formula to succeed within it. And that's what we hopefully have shown you in 2022 in prior and that's what we think will unlock a lot of value in 2023 and beyond. Thanks for listening to Fred and I on that piece, and certainly open to any questions, operator when you're ready.

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] Your first question comes from Cosmos Chiu with CIBC. Please go ahead.

Great. Thanks, Sandeep and team, and congrats on a very strong Q4. And Sandeep, good talking to you again it's been a while. Maybe my first question is on your Battery Metals here, the Patriot Battery Metals. As you mentioned, Sandeep, it's a pretty long term. And it kind of speaks to the optionality of your model here. But how do you value it, at this point in time, given that there's only a few drill holes, but also given the fact that it is now over a $1 billion market cap company? So, how do you internally value it? How should we look at it? And then from that perspective, what are you going to do with it? Are you just going to keep in the portfolio for optionality, or is there alternatives in terms of potentially monetizing it shorter-term?

Yeah. Sure. Those are good questions and it's funny where you started your question, your comment, Cosmos because I did see you at the airport at yesterday. As you walk, pass me the board of plane. No, look, I think on the Battery Metals side, it's something we've said, our focus is going to remain gold and silver maybe to start with the back end to your question, our focus is going to remain growing our precious metals, cash flow and NAV per share in the other category, which we just had more flexibility. And I think anybody, I think what we've shown you and said and then shown you in 2022 is a preference for copper in that space, especially, if we get better deals and accept the longer life assets and the process. But that's, in moderation without changing what I've said to you about the focus. The fact that we can pull something like 2% NSR on most of Corvette out of our back pocket, I think it's just -- is an exceptional example. And then maybe a big example but it's an example of the optionality of this portfolio. The fact that we do have such a large development waiting. We have a large exploration waiting that people don't even get to. Because you don't need to get to it, if you're trying to value us and get to one times NAV. You don't need to focus within that other category, but it matters. And those are the types of things that have driven the incumbents, larger peers in our group for a long time. We just haven't had the benefit of it as a relatively -- the relative newcomers. So, to have those types of wins and potential wins in the portfolio, I think is…

Of course. Maybe switching gears a little bit. Going to Victoria Gold, you kind of touched on it, Sandeep earlier in the presentation. But Eagle, the Eagle mine had an updated mine plan earlier today. As we saw lower annual production but longer mine life and it seems like higher CapEx. I'm sure, as you said, you keep internal models on all your assets, like how does that compare in terms of your internal expectations, were you expecting sort of a longer mine life, lower annual production? I think you mentioned that it was good news story earlier during the presentation, but could you maybe walk us through, did it meet your expectations?

Yeah, look. I'd say, yes. In terms of the mine plan, we obviously have conversations with our partners at all times. They can share a little bit more with us and then, now we're dealing with the same information that everybody has. But I will caveat my comments with the fact that I still need, we as the team still need to pour through that press release. So I just skimmed it this morning and we had a brief discussion about it. But overall, I think, when I saw and again with that caveat, maybe I missed something. I think in the full -- life of mine, there's a trickle higher production. To be honest, that’s obviously spread out over a longer. So, the back end is a little bit different. Over the next few years, I think we're seeing kind of what we expect to see. And I think on average over the next eight years or over an eight year period of about that 200,000 ounce mark. So that's kind of where we've been expecting them to go. Obviously, for the time being or maybe for the foreseeable -- maybe for wherever the project 250 is not in the cards but even so, I think just getting up to that 200,000 steady-state level, I think good news, it's coming at a cost. I think the truth of the mining sector. And I think if you've been following as I'm sure all of you have, the guidance number is coming out for 2023 so far. I think we've seen generally speaking, a little tougher to get the ounces out of the ground and cost more, right? So I think that's a thematic across the entire sector. That's not specific to Victoria. But just as a function of where we are from an inflation perspective for the next, for a while, if it's sticky in the world, it's even stickier in the mining sector. So, we're comfortable with what that is and again that's a little bit of a dichotomy of operating company versus royalty company. But I think we're pretty pleased with what they've put out. We look forward to, as I said, spending more time going through it. And then obviously, getting the technical report within the next 45 days. So further look into it. But overall I think for us, we're happy with what we're seeing. I think the transition for them from single asset developer to producer, that's one that's crippled a lot of companies. I think they've actually dealt with it well, especially during a COVID period, inflationary period. We're certainly pleased with our partner, but we brought to market participants are looking forward to a better 2023.

Perfect. Thanks, Sandeep, again for your very good answers, and I'm sure I'll keep bumping into you at airports.

Yeah. Try not to forget talking to me today.

Your next question comes from John Tumazos. Please go ahead.

Thank you. Just looking at the stock prices of your operators as lead indicators, Sandeep. Island Gold, Alamos appears to be doing well, Capstone appears to be doing well. Some of these far away companies I'm not familiar with that. But what are some of your other operators where the share price is a good lead indicator? And then after you give me the good news, I'll ask you some questions about the other ones.

Yeah, look, I mean, that's -- let me explain right slides. I think, look, I think that's a good point. I mean, generally speaking, share prices will do what they do. I think our partners overall had a very strong 2022 and I think they're poised to have a strong 2023 whether you look at. Obviously, it was a tough day last week for Agnico for instance. But I think that story is still exceptionally strong. You mentioned, Capstone, you mentioned, Alamos. I think if you look at our partners as a whole, you throw in Newmont in there with Eleonore, so in SSR and Eldorado, I think our partners are on the upswing. I do think, there is a -- as I touched on it with Cosmos questions, I do think there is a difference a little bit in that. On the operating side, we are seeing cost pressures. We're still seeing CapEx pressure. So I think if you've seen some weakness in share price, it has to do with that side of the equation, and then the beauty for us as we've re-positioned ourselves is the cash -- the cost side of the equation doesn't factor or as much as long as our partners are pushing forward with the initiatives that we need to push forward with as long as our assets continue to matter to our operators and our partners. And from that perspective, I would tell you that they absolutely do. Because we're generally talking about assets that are top one or two to our partners. They're spending a lot of energy on them and they are important to their business, they're low-cost mines for the most part. So, I think we'll continue to see a lot of positivity from our partners on our assets.

So, talking about the ones where the stocks didn't go up. Where do you think is a good time frame to expect Agnico to have East Gouldie as a proven and probable reserve or do you think it's going to be like, Odyssey where they just produce the gold and don't bother to document reserves.

Yeah. Look, I mean, I think we had the first trickle of reserves this year in the entire Odyssey deposit. I think the M&I is -- M&I for Nickel probably reserves for most people. I think that's the way -- they'll probably position it. So to have north of 6 million ounces in the Alumni category, a big lift, almost 3 times versus what was in there last year, good news. They're drilling from surface largely some underground drilling now in 2022, I think. And I hope that, that definition drilling will just intensify has to have more access on the ground, still hitting it really hard from a drill perspective in 2023. I think it's still the same 13 rigs doing basically the same amount of drilling as the last two years.

If we move to Odyssey, that's down almost 80% from when you first announced the formation of the company. What are the things that attracted you to the Barkerville acquisition? And would you never like make a property acquisition again or not in a narrow vein structure, what are the outlooks for those?

Yeah. Look, I mean, I think we can go back and play our business history. Certainly, there was a logic at the time to protect an asset that mattered and put it back into the right vehicle that are funded better back in that -- not massive, but that's exactly what ended up happening, unfortunately, with a lot of pain in between from a market perspective. So no, that's not something we're looking to ever revisit. I still think that -- and you're absolutely right, the share price of Osisko development was tough in the last two years. It wasn't a lot better for most development companies, but it certainly was tough on the Osisko development side. My hope and expectation is that, that can bottom out and start to have an upward trend again in 2023. I think it will be driven largely off the enthusiasm that the market has for Tintic and that high-grade story in Utah. That initial resource, I think, on a postage stamp was really good. The fact that, that postage stamp (ph) of 7% to 10% of the potential mineralized envelope, really good, the fact that I have a whole electric and Robert [indiscernible] drilling on their immediate boundary for deep copper porphyry potential that if they find the whole world will hear about, and we'll transition over the boundary. So I think all that will be the good news story. Otherwise, you get paid to wait from a Caribou perspective with the feasibility in and the permitting is still expected for this year. I don't take that in the stock. So hopefully, between those two kind of flagship assets and some permitting good use from a San Antonio perspective. Hopefully, it can be a turnaround year. We're happy to see them take in some more money and have the funds to go after their assets continue to go after their assets aggressively. So yes, tough one, absolutely. We all take it on the [Multiple Speakers]

[Multiple Speakers] technical reports and they're in permitting, but their stock lags, do you just write that off to the batch stock market for gold stocks?

Yes. I don't think you could do anything else. I mean the asset's tremendous. The catalyst they've had are real. I touched on them earlier. So I think it's unfortunate that the market still doesn't give development companies enough credit. I think the investment dollars have, especially in 2022 gone towards producing names. And hopefully, we'll see a market that's a little bit better for the development names. That matters to us on the share price. It matters to a small perspective. We want to see that company succeed in every way. We've got the royalty on the royalty side. We think the value of our assets has grown on the share side, it hasn't. But I don't lose any sleep over Osisko mining. It's just too special of an asset, and it fits on one hand, very easily in terms of the things you could compare it to in the market. So I think that will have its momentum, so I’m not sure (ph).

Is Falco one that has a timetable to proceed. That's one where the share is sort of pretty dormant.

Yes. Look, if it does, I mean, I think it's tough to point to it right now. That's not one where we have to kind of commit it dollars until their success going forward. So we hope that there is, but we're not kind of advocating today and tallying (ph) all the table that there will be in any kind of time line that we can point to. Again, I hope that there is because I think it's an important 10 million ounces that's valuable. I mean if Wasamac or, for instance, can be railed to Malartic then those ounces should matter too in that area. But until Glencore kind of figures out what it's doing with the government in terms of their emissions until they kind of figure out how to be -- how to fit in the town of [indiscernible] from a long term perspective, I think it's tough to say that the underground ounces below the Horne 5 are going to get a lot of attention. So that's kind of option value, I think I would point at this point. I hope it does come good, but I don't have a time line for you, John.

So if I could follow up on the earlier question from Cosmos. There's a number of emerging battery metals royalty companies. That's a good promotional theme, I guess they need assets. The lithium prices come off, the EVs aren't selling well this month, but the stock market has an appetite. Two of the worst proposals I ever got that I refuse to have to speak in my conference with lithium companies, either on the basis of metallurgy or one of them had 3.4 million tons of resource per assay, like no data. So why not sell Corvette into the lithium bubble to somebody that might be able to promote it better as a pure play on lithium?

No reason other than we're not in the business of giving away value for less than what we think it's worth. So I think that, that logic holds. I don't know what happens to lithium sector in the medium term, long term. I do know that the world needs more lithium assets, does it need all of them, time will tell. But this -- even though it's an early stage one, I think it's one of the better ones out there that we can see. So we like what we see here. It's early days. We're very happy with the progress they're making. We look forward to seeing more both on the exploration, ultimately the resource on the metallurgy side, but it all bodes well. The level of importance that the Quebec government is placing on battery metals, lithium, in particular. I think you've seen it and the other things that are involved in is high. The government wants Quebec to be a major player on the world scale from that perspective. So a lot of good things, even though it's very early, there's a lot of good things pointing in the direction of that and we'll either let that unfold if someone wants to -- that's in the other category where I think analysts prescribe $100 million in that too, if you believe in the rule of thumb that says every point of royalty is worth four or five of the assets and the market cap will imply that this asset alone is worth nine figures. It sits in another NAV basket that has nine figures to it in totality, a lot of good things in there. So it's a good place to be. We'll take us for the time being and watch it. But if ever it matters more to somebody else than it does to us than to be it.

Thank you, Sandeep.

My pleasure, John.

[Operator Instructions] Your next question comes from Ralph Profiti with Eight Capital. Please go ahead.

Hey. Thanks, Sandeep. Just one quick question for me, if I may. The first half of 2023, that's what you have in your presentation with respect to the CSA transaction. Just wondering, is that -- should we be thinking about that as a place holder? It's been a while since we've heard from the Metals Acquisition Corp guys on the progress of this complicated transaction. So just wondering what you're thinking about the timing of that -- and is the silver and potential [indiscernible] copper stream would we possibly see those enter into the guidance when the deal closes, meaning that silver and that copper would come in immediately upon deal closing?

Yes. Look, good question, Ralph and good morning, and you're right. As that transaction has been very long in the [indiscernible]. I don't [indiscernible] for destacking transactions, if you want to keep your life simple. But I think the team there has done a phenomenal job out -- put out lasting, a pretty nasty drop in the copper price last year, recutting a deal with Glencore that makes more sense, recutting a deal with us that makes more sense for us and now coming to the very tail end of that transaction. So just before Christmas, the odd timing, but just before Christmas -- or sorry, between Christmas and New Year is, I can't exactly recall -- they launched their F-4 statement with the SEC, their prospectus essentially going back and forth now. And that was one gating item. So our hope is that, that gets done in the very near term. They're putting a pin in their pipe financing and getting to a factual (ph) or vote, if not late March, let's probably call it, April. So that one is coming to a head. We have factored in the silver into that guidance number for 2023 with an effective date of February 1. So we factored in 11 months of silver if that doesn't come in, then the guidance, the range that I would point you to is more middle of that range than on top of that range. But that's what we've done because we're pretty confident about it after and that hasn't always been true. I was describing it as a coin flip in the middle of 2022. And now I see very good visibility to the end result. In terms of the copper, it doesn't really matter because there's -- even though the copper, it's all producing today, obviously, I'd remind you that in the deal, we gave them essentially a one-year hiatus on the copper. So it starts -- it would start in 2024 anyways. So that would be in the guidance number for next year. So it's not in the 2023 number nor is it in the 2027 number, we'd have an opportunity to revisit that next year depending on how much of that copper has taken. But yes, after -- yes, after a long lull, trust me, we felt it, it's nice to be seeing daylight there.

Understood. Thanks very much.

No problem, Ralph. Thank you.

There are no further questions at this time. Please proceed.

Okay. Great. Thank you, operator. Thanks, everyone, for bearing with us for almost exactly an hour and really happy with the way we ended the year, really happy with how we're set up to unlock value in 2023. We do think we've done a lot of the heavy lifting and the story is resonating right now. So we intend to kind of keep after it, and hopefully, we'll have good things to come back to you with. Our partners are certainly doing that. And hopefully, we'll continue to see a good pipeline of opportunities for us. So thanks for your time, and we'll talk soon. Thank you.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.