Sandstorm Gold Announces 2018 First Quarter Results and Record Revenue

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Algemeen advies 10/05/2018 06:05
Sandstorm Gold Ltd. (“Sandstorm” or the “Company”) (NYSE American: SAND, TSX: SSL) has released its results for the first quarter ended March 31, 2018 (all figures in U.S. dollars).

First Quarter Highlights
•Record revenue of $19.5 million (Q1 2017 - $18.8 million);
•Attributable gold equivalent ounces sold1 of 14,685 ounces (Q1 2017 – 15,558 ounces);
•Average cash cost per attributable gold equivalent ounce of $276 resulting in cash operating margins1 of $1,050 per ounce (Q1 2017 - $258 per ounce and $952 per ounce respectively);
•Cash flows from operating activities, excluding changes in non-cash working capital1, of $13.4 million (Q1 2017 – $13.2 million);
•Net income of $0.4 million (Q1 2017 – $7.0 million);
•On January 17, 2018, the Company completed its previously announced transaction to acquire a 2.0% NSR on the producing Houndé gold mine in Burkina Faso which is owned and operated by Endeavour Mining Corporation.
•In January 2018, the Company completed its previously announced arrangement to sell $18.3 million in debt and equity securities of Equinox Gold Corp. The monetization of a significant portion of Sandstorm’s debt and equity investments is a part of the Company’s strategy of selling non-core assets and using the capital raised to continue growing the stream and royalty portfolio.
•Sandstorm acquired 4 royalties on exploration-stage projects in Canada and Mexico. The Company now has 180 royalties in its portfolio.

Based on the Company’s existing royalties, attributable gold equivalent production for 2018 is forecasted to be between 53,000 – 60,000 ounces. The Company is forecasting attributable gold equivalent production of 125,000 ounces per annum by 2022.

Financial Results

Sandstorm’s revenue during the first quarter of 2018 was a record for the company. Revenue was $0.6 million higher than in the first quarter of 2017, driven by a 10% increase in the average realized selling price of gold. The revenue increase was partially offset by a 6% decrease in the number of attributable gold equivalent ounces sold, largely due to the timing of sales.

Net income was lower when compared to the same period in 2017 due to a number of factors including a $4.5 million non-cash impairment charge related to the Gualcamayo royalty and a decrease in the gains recognized on the revaluation of the Company’s investments. The decrease in net income was partially offset by a decrease in the Company’s income tax expense, whereby a recovery of $1.4 million was recognized largely related to the Gualcamayo royalty impairment.

Streams & Royalties: Q1 Updates

Of the gold equivalent ounces sold by Sandstorm, approximately 38% were attributable to mines located in Canada, 16% from the rest of North America and 46% from South America and other countries.

Three months ended Mar. 31, 2018
Revenue (in $000s) Gold Equivalent Ounces

Canada $7,423 5,591
North America excl. Canada $3,035 2,293
South America & Other $9,012 6,801
Total $19,470 14,685


Streams and royalties on Canadian mines contributed 18% less gold equivalent ounces sold to Sandstorm when compared to the first quarter of 2017. The change is primarily attributable to a decrease in gold equivalent ounces sold attributable to the Diavik mine in the Northwest Territories and the Black Fox mine in Ontario, offset by an increase in ounces from the Ming mine in Newfoundland.

North America Excluding Canada

When compared to the first quarter of 2017, gold equivalent ounces coming from North America, excluding Canada, decreased by 36%. The change was driven by a decrease in royalty revenue from the Emigrant Springs mine in Nevada.

South America & Other

Operations in South America and other countries contributed an additional 1,621 gold equivalent ounces sold when compared to the first quarter of 2017, representing a 31% increase. The newly acquired Houndé royalty contributed approximately 1,304 of those ounces.


Sandstorm has a silver stream with Yamana Gold Inc. (“Yamana”) whereby it will purchase silver from the Cerro Moro mine in Argentina beginning in 2019. Up until 2019, Sandstorm is purchasing silver from Yamana’s Minera Florida and Chapada mines.

At Cerro Moro, Yamana recently reported that open pit operations have commenced and development activities are underway at the high grade Escondida central pit. First ore was fed to the ball mill on April 25, 2018 and first doré production is expected in May 2018. The start-up is progressing well with milling rates and feed grades expected to ramp up through the second quarter. The project remains on budget and is on track to reach 2018 production guidance of 3.75 million ounces of silver.

For more information refer to and see the press release dated May 2, 2018.


Yamana recently announced that they have completed studies to evaluate several development opportunities at Chapada. These opportunities range in scope from plant optimization initiatives to enhance copper and gold recoveries, to a plant expansion to bring forward cash flows, and pit wall pushbacks to expose higher grade ore zones. Based on the results from the studies, Yamana is progressing the opportunities to the next stage of evaluation and development.

The studies on expanding the Chapada processing plant capacity up to 32 million tonnes per annum have concluded that higher throughput can be achieved with the installation of new equipment. A feasibility study has been initiated for the plant expansion and is expected to be completed in early 2019.

For more information refer to and see the press release dated May 2, 2018.


Equinox Gold Corp. (“Equinox Gold”) announced that mining activities commenced in mid-April at the Aurizona gold mine in Brazil. They are currently working on removing waste from two locations in the Piaba pit and developing access roads in preparation for ore mining in the third quarter of 2018. Construction is proceeding on schedule to pour gold by the end of 2018.

Equinox Gold’s exploration team is focused on mine life extension and district-scale opportunities. During the first quarter of 2018, they announced positive drilling results from six targets east and north east of the reserve pit. These discoveries will be tested in upcoming exploration programs and a study is underway examining opportunities to develop the underground potential of the Aurizona gold deposit. In addition, drill results from more than 11,000 metres of drilling in 2017 at the Piaba and Piaba West targets are being incorporated into a resource update that is targeted for completion in mid-2018.

For more information refer to and see the press release dated May 3, 2018.

Webcast & Conference Call Details

A conference call will be held on Thursday, May 10, 2018 starting at 8:30 PDT to further discuss the first quarter results. To participate in the conference call, use the following dial-in numbers and conference ID, or join the webcast using the link below:

Local/International: (+1) 416 764 8688
North American Toll-Free: (+1) 888 390 0546
Conference ID: 09308101

Sandstorm Gold Today 10/5 Vol. 68.300
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