Sandstorm Gold Ltd. (“Sandstorm Gold Royalties”, “Sandstorm” or the “Company”) (NYSE American: SAND, TSX: SSL) has released its results for the fourth quarter and year ended December 31, 2019 (all figures in U.S. dollars).

FOURTH QUARTER HIGHLIGHTS
•Attributable gold equivalent ounces sold1 of 16,113 ounces (Q4 2018 — 14,182 ounces);
•Revenue of $24.0 million (Q4 2018 — $17.5 million);
•Cash flows from operating activities, excluding changes in non-cash working capital1 of $15.2 million (Q4 2018 — $11.2 million);
•Net income of $5.3 million (Q4 2018 — $2.7 million);
•Credit Facility Amendment: The Company’s revolving credit facility was amended allowing the Company to borrow up to $225 million with an additional uncommitted accordion of up to $75 million, for a total facility of up to $300 million for acquisitions and general corporate purposes. The tenure of the facility is four years and is extendable by mutual consent of Sandstorm and the banking syndicate.

FULL YEAR HIGHLIGHTS
•Record attributable gold equivalent ounces sold1 of 63,829 ounces (FY 2018 — 57,646 ounces);
•Record revenue of $89.4 million (FY 2018 — $73.2 million);
•Average cash cost per attributable gold equivalent ounce of $286 resulting in cash operating margins1 of $1,115 per ounce (FY 2018 — $278 per ounce and $991 per ounce respectively);
•Record cash flows from operating activities, excluding changes in non-cash working capital1 of $60.7 million (FY 2018 — $49.1 million);
•Net income of $16.4 million (FY 2018 — $5.9 million);
•Significant acquisitions with near term cash flow, strong counterparties, and significant exploration upside: ?In January 2019, the Company acquired a 0.9% NSR on the precious metals produced from the Fruta del Norte gold project in Ecuador, which is currently under construction and owned by Lundin Gold Inc. The royalty was acquired from a private third party for $32.8 million in cash and covers more than 644 square kilometres, including all 30 mining concessions held by Lundin Gold.
?In April 2019, the Company announced that it had entered into a $42.5 million financing package with Americas Gold and Silver Corporation (“Americas Gold”) which includes a $25 million precious metal stream and an NSR on the Relief Canyon gold project in Nevada, U.S.A., a $10 million convertible debenture and a $7.5 million private placement. Under the terms of the precious metals stream, Sandstorm is entitled to receive 32,022 ounces of gold over a 5.5 year period, after which, the Company will purchase 4% of the gold or silver produced from the Relief Canyon project for ongoing per ounce cash payments equal to 30%–65% of the spot price of gold or silver. In addition, Sandstorm will also receive a 1.4%–2.8% NSR on the area surrounding the Relief Canyon mine.

•Normal Course Issuer Bid: Under Sandstorm’s normal course issuer bid, the Company purchased and cancelled approximately 8.7 million common shares in 2019 for total consideration of $46.5 million.

OUTLOOK
Based on the Company’s existing royalties, attributable gold equivalent ounces sold for 2020 is forecast to be between 60,000 and 70,000 ounces. The Company is forecasting attributable gold equivalent production of 125,000 ounces in 2024.

FINANCIAL RESULTS
Over the course of the 2019 year, the Company realized annual records for both revenue and attributable gold equivalent ounces sold of $89.4 million and 63,829 ounces respectively. The records represent a 22% increase in revenue and an 11% increase in attributable gold equivalent ounces sold compared to the 2018 year. Contributions from the Yamana silver stream was the main driver of the growth in gold equivalent ounces, as Sandstorm received its first silver delivery from the Cerro Moro mine in the second quarter of 2019.

Net income and cash flow from operations were both higher when comparing the 2019 year to the 2018 year due to a number of factors including an increase in revenue and an increase in gains recognized on the revaluation of the Company’s investments. The revaluation was primarily driven by the change in fair value of the Americas Gold and Equinox Gold Corp. convertible debentures. The year over year increase in net income was partially offset by an increase in depletion expense, driven by an increase in the number of attributable gold equivalent ounces sold.

STREAMS & ROYALTIES
Of the gold equivalent ounces sold by Sandstorm during the fourth quarter of 2019, approximately 23% were attributable to mines located in Canada, 18% from the rest of North America, 44% from South America and 15% from other countries.

Three Months Ended Dec. 31, 2019 Year Ended Dec. 31, 2019
Revenue (in millions) Gold Equivalent Ounces Revenu (in millions) Gold Equivalent Ounces
Canada $5.6 3,789 $27.3 19,634
North America excl. Canada $4.2 2,842 $15.1 10,725
South America $10.6 7,099 $30.8 21,732
Other $3.6 2,383 $16.2 11,738
Total $24.0 16,113 $89.4 63,829

Canada

Streams and royalties on Canadian mines contributed 17% fewer gold equivalent ounces to Sandstorm when compared to the fourth quarter of 2018. The change is primarily due to a decrease in royalty revenue from the Diavik mine in the Northwest Territories and a decrease in gold equivalent ounces sold from the Black Fox mine in Ontario, partially offset by an increase in royalty revenue from the Bracemac-McLeod mine in Québec.

North America Excluding Canada

The gold equivalent ounces sold from operations located within North America, but outside of Canada, decreased by 19% compared to the fourth quarter in 2018. The changes were driven by a decrease in gold equivalent ounces sold from the Santa Elena mine in Mexico, partially offset by an increase in royalty revenue from the San Andres mine in Honduras.

RELIEF CANYON STREAM & ROYALTY

Americas Gold announced late in the fourth quarter of 2019 that they have advanced to the final stage of construction at their Relief Canyon project with initial ore placement on the leach pads. The first gold pour is expected in February 2020 and Americas Gold expects to reach commercial production at Relief Canyon during the second quarter of 2020.

For more information, refer to www.americas-gold.com and see the press release dated December 19, 2020.

South America

Operations in South America contributed 130% more gold equivalent ounces when compared to the fourth quarter of 2018. The change is primarily due to the addition of gold equivalent ounces from the Cerro Moro mine in Argentina, royalty revenue from the Aurizona mine in Brazil, and royalty revenue from the Fruta del Norte mine in Ecuador.

FRUTA DEL NORTE ROYALTY

Lundin Gold Inc. (“Lundin Gold”) announced production of the first doré bar from the gravity circuit at the Fruta del Norte mine on November 16, 2019. Ramp up of operations is progressing on schedule and Lundin Gold expects to reach commercial production during the second quarter of 2020.

For more information refer to www.lundingold.com and see the press releases dated November 18, 2019 and January 9, 2020.

Other

Streams and royalties on mines in other countries contributed 21% less gold equivalent ounces sold when compared to the fourth quarter of 2018. The change is primarily due to a decrease in royalty revenue from the Forrestania mine in Australia.

UPLISTING TO NEW YORK STOCK EXCHANGE

Sandstorm has received approval from the New York Stock Exchange (the “NYSE”) to transfer the listing of its common shares from the NYSE American to the NYSE. The Company expects to begin trading on the NYSE effective at the open of markets on February 21, 2020.

Sandstorm’s shares will trade on the NYSE under the ticker symbol “SAND”, the same symbol the Company’s common shares currently trade under on the NYSE American. The Company’s common shares will continue to be listed on the Toronto Stock Exchange under the ticker symbol “SSL”.

In connection with the listing of common shares on the NYSE, the Company will voluntarily delist its common shares from the NYSE American.

WEBCAST & CONFERENCE CALL DETAILS

A conference call will be held on Friday, February 14, 2020 starting at 8:30am PST to further discuss the fourth 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:

International: (+1) 201 389 0899
North American Toll-Free: (+1) 877 407 0312
Conference ID: 13698493
Webcast URL: https://bit.ly/2tMjBNf