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Royal Gold, Inc. (NASDAQ: RGLD), along with its subsidiaries, has officially released its 2025 guidance outlining anticipated sales volume, depletion, depreciation, and amortization expenses (DD&A), and the effective tax rate for the calendar year.
In a move aimed at enhancing clarity amid fluctuating commodity prices, Royal Gold has adopted a sales volume basis for its 2025 sales guidance. This approach will help to represent the physical metal sold, with royalty revenue transformed into gold equivalent ounces (GEOs) based on average metal prices for the given time frame.
Key Sales Guidance for 2025
Royal Gold’s expectations for 2025 sales volume, DD&A, and effective tax rate are summarized as follows:
| Category | 2025 Guidance |
|---|---|
| Gold | 210,000 – 230,000 oz |
| Silver | 2.7 – 3.3 M oz |
| Copper | 13.5 – 16.0 M lb |
| Other Metals | $18.0 – $21.0 M |
| DD&A | $126 – 142 M |
| Effective Tax Rate | 17 – 22% |
Gold, silver, and copper are expected to drive the majority of revenue in 2025. While sales from other metals will contribute less overall, the guidance reflects assumed prices of $6.75/lb for nickel, $0.85/lb for lead, and $1.20/lb for zinc.
Sales volumes are projected to be relatively balanced between the first and second halves of the year.
Underpinning Assumptions
The 2025 guidance is crafted based on a thorough analysis of confidential production forecasts from various operating partners, supplemented by publicly available projections for interests lacking confidential data. These third-party estimates have been adjusted to reflect management’s expertise.
Regarding Royal Gold’s Principal Properties, the following assumptions play a critical role in shaping the 2025 outlook:
- Mount Milligan Deliveries: A typical six-month lag between production and stream deliveries is expected, with lower Q4 2024 gold production potentially affecting the first half of 2025 sales.
- Pueblo Viejo Mine Trends: Continued ramp-up in gold recovery and plant throughput is aimed for in 2025, although operations will be affected by a planned 35-day shutdown in Q1. Silver delivery levels are anticipated to be modest due to a targeted silver recovery enhancement project, delaying significant deliveries until late 2025.
- Cortez Complex Royalty Rates: Royalty earnings from Barrick’s guided gold production of approximately 680,000 to 765,000 ounces are expected, with an average rate of approximately 3.1%. This reflects fluctuations based on the production area across the facility.
- Increased Production at Andacollo: An uptick in gold output at this site is anticipated due to improvements in water availability, enhancing mill throughput consistency. Copper production is projected to rise, correlating with higher gold outputs.
Additional Noteworthy Production Insights
Royal Gold’s diverse asset base also contributes to its production expectations, including:
- Anticipated higher gold production from the Peñasco pit at Peñasquito, while silver, lead, and zinc productions may decrease.
- Chifeng Gold’s guidance projects about 200,000 ounces from the Wassa mine for 2025.
- New Gold Inc. forecasts gold production between 265,000 and 295,000 ounces from the Rainy River mine.
- Increased silver yield at Khoemacau relates directly to heightened copper output.
- A new royalty from the Back River mine is expected to yield between 120,000 and 150,000 ounces in its first year of production.
It’s important to note that gold deliveries from the Mount Milligan Cost Support Agreement are not included in the sales guidance. The first installment of deferred gold consideration is expected in Q3 2025.
Conclusion
Royal Gold’s effective tax rate forecast for 2025 does not anticipate any unusual tax items or regulatory changes affecting their operations across tax jurisdictions.
Furthermore, this guidance remains independent of any new contributions from potential acquisitions during the year.
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