Sandstorm Gold Ltd. (“Sandstorm Gold Royalties”, “Sandstorm” or the “Company”) (NYSE: SAND, TSX: SSL) has released its results for the first quarter ended March 31, 2022 (all figures in U.S. dollars).

FIRST QUARTER HIGHLIGHTS
Record attributable gold equivalent ounces1 of 18,741 ounces (Q1 2021—17,444 ounces);
Record revenue of $35.4 million (Q1 2021—$31.0 million);
Record cash flows from operating activities, excluding changes in non-cash working capital1 of $26.7 million (Q1 2021—$23.0 million);
Average cash cost per attributable gold equivalent ounce1 of $283 resulting in cash operating margins1 of $1,604 per ounce (Q1 2021 — $307 per ounce and $1,470 per ounce respectively);
Net income of $9.1 million (Q1 2021—$5.0 million); and
Creation of new strategic partner, Horizon Copper:
Hod Maden Gold Stream: In February 2022, the Company announced it has signed a letter of intent, in part, to sell its 30% interest in Hod Maden to Royalty North Partners Ltd. for consideration, in part, for a flagship gold stream on Hod Maden and a portion of debt and equity in the resulting issuer (“Horizon Copper”). With this transaction, Sandstorm intends to unlock additional value in Hod Maden through the re-rating of the asset as a gold stream in its portfolio and further repositions Sandstorm as a pure-play precious metals royalty and streaming company. The transaction is conditional upon various closing items and is expected to close in the second half of 2022. For more information see press release dated February 17, 2022.
Antamina Silver Stream and Residual Royalty: Subsequent to the quarter’s end and concurrent to the BaseCore Transaction (as described below), Sandstorm has partnered with Horizon Copper to sell a portion of the Antamina copper royalty acquired in the BaseCore acquisition and in consideration receive a silver stream on the asset, a residual NPI royalty, a $105 million debenture, equity, and $50 million in cash. The subsequent spin-out of the Antamina royalty is expected to position Horizon Copper as a competitive copper company with a portfolio of high quality cash-flowing and development stage copper assets. For more information, see press release dated May 2, 2022.
US$1.1 Billion Portfolio Transformation: Subsequent to the quarter’s end, Sandstorm announced two transactions totaling $1.1 billion, including the acquisition of Nomad Royalty Company (the “Nomad Acquisition”) and a portfolio of royalty assets from BaseCore Metals LP (the “BaseCore Transaction”). The combined transactions are expected to significantly increase Sandstorm’s scale through the addition of several high quality, low-cost assets maintaining the Company’s industry-leading growth and portfolio diversification. The Nomad Acquisition and BaseCore Transaction are subject to various closing conditions and are expected to close in the second half of 2022 and by the third quarter of 2022, respectively. For more information, see press release dated May 2, 2022.
Upsized Credit Facility: Concurrent with the transactions described above, Sandstorm entered into an agreement with the Bank of Nova Scotia and BMO Capital Markets securing a commitment to upsize the Company’s existing revolving credit agreement to borrow up to $500 million with an additional uncommitted accordion of up to $125 million, for a total of up to $625 million. The upsize is contingent upon closing the BaseCore Transaction, and the accordion of up to $125 million is contingent on closing the Nomad Acquisition. See press release dated May 2, 2022 for more information.
OUTLOOK
Based on the Company’s existing royalties and contingent on the close of the Nomad Acquisition and BaseCore Transaction, attributable gold equivalent ounces for 2022 is forecast to be between 80,000 and 85,000 ounces. Subject to the conversion of the Hod Maden interest into a gold stream and the closing of the Nomad Acquisition and BaseCore Transaction, the Company is forecasting attributable gold equivalent production to be 155,000 ounces in 2025.

FINANCIAL RESULTS
During the three months ended March 31, 2022, the Company realized record revenue of $35.4 million compared with $31.0 million for the comparable period in 2021. The increase is attributable to a 7% increase in attributable gold equivalent ounces sold as well as a 6% increase in the average realized selling price of gold. In particular, the increase in revenue was driven by an increase in revenue attributable to the Vale Royalties, which were purchased in June 2021, and an increase in revenue attributable to the Vatukoula gold stream, which commenced making deliveries in December 2021.

Net income was higher during the first quarter of 2022 when compared to the same period in 2021 primarily due to the increase in revenue. Higher net income was also due to a $2.0 million increase in the gains recognized on the revaluation of the Company’s investments compared to the comparable period in 2021. The year-over-year increase in net income was partially offset by an increase in depletion largely due to an increase in attributable gold ounces sold and an increase in tax expense resulting from higher net income.

STREAMS & ROYALTIES
Of the gold equivalent ounces sold by Sandstorm during the first quarter of 2022, approximately 18% were attributable to mines located in Canada, 10% from the rest of North America, 61% from South America, and 11% from other countries.

Revenue
(in millions) Gold Equivalent
Ounces
Canada $6.3 3,314
North America excl. Canada $3.6 1,883
South America $21.5 11,410
Other $4.0 2,134
Total $35.4 18,741
Canada
Streams and royalties on Canadian mines contributed 10% more gold equivalent ounces to Sandstorm when compared to the first quarter of 2021. The change is primarily due to an increase in royalty revenue from the Diavik mine in the Northwest Territories, driven by diamond price increases. The increase was partially offset by a decrease in ounces sold from the Ming mine. In April 2022, Rambler Metals & Mining PLC, the operator of Ming, exercised its option to repurchase the Ming gold stream in exchange for a payment of $6.7 million in cash and 1,150 ounces of gold (delivered over the course of 18 months).

North America Excluding Canada
The gold equivalent ounces sold from operations located within North America, but outside of Canada, contributed 30% less gold equivalent ounces when compared to the first quarter of 2021. The change was primarily driven by a decrease in ounces received from the Santa Elena mine, partly due to a decrease in production at Santa Elena as well as the timing of sales. The decrease was partially offset by an increase in ounces received from the Relief Canyon mine in Nevada.

South America
Operations in South America contributed 14% more gold equivalent ounces sold when compared to the first quarter of 2021. The change is primarily due to an increase in royalty revenue from the Vale Royalties, which were purchased in June 2021, and an increase in gold equivalent ounces sold from the Chapada mine in Brazil, primarily driven by an increase in the average selling price of copper. The increase was partially offset by a decrease in royalty revenue from the Aurizona mine in Brazil.

Other
Streams and royalties on mines in other countries contributed 22% more gold equivalent ounces sold when compared to the first quarter of 2021. This change is primarily due to an increase in ounces sold from the Vatukoula mine in Fiji, which commenced making deliveries to Sandstorm in December 2021, and an increase in royalty revenue from the Houndé mine in Burkina Faso. The increase was partially offset by a decrease in gold equivalent ounces sold from the Karma mine in Burkina Faso, which was primarily due to the conclusion of the five-year fixed delivery period in accordance with the terms of the stream agreement.

WEBCAST & CONFERENCE CALL DETAILS
A conference call will be held on Thursday, May 12, 2022 starting at 8:30am 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:

International: (+1) 416-764-8688
North American Toll-Free: (+1) 888-390-0546
Conference ID: 30491561
Webcast URL: https://bit.ly/3kzDz4D

Note 1
Sandstorm has included certain performance measures in this press release that do not have any standardized meaning prescribed by International Financial Reporting Standards (“IFRS”) including (i) total sales, royalties, and income from other interests, (ii) attributable gold equivalent ounce, (iii) average cash cost per attributable gold equivalent ounce, (iv) cash operating margin, and (v) cash flows from operating activities excluding changes in non-cash working capital. Total sales, royalties and income from other interests is a non-IFRS financial measure and is calculated by taking total revenue which includes sales and royalty revenue, and adding contractual income relating to royalties, streams and other interests excluding gains and losses on dispositions. The Company presents total sales, royalties, and income from other interests as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other streaming and royalty companies in the precious metals mining industry. Attributable gold equivalent ounce is a non-IFRS financial ratio that uses total sales, royalties, and income from other interests as a component. Attributable gold equivalent ounce is calculated by dividing the Company’s total sales, royalties, and income from other interests for the period by the average realized gold price per ounce from the Company’s gold streams for the same respective period. The Company presents attributable gold equivalent ounce as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other streaming and royalty companies in the precious metals mining industry that present results on a similar basis. Average cash cost per attributable gold equivalent ounce is calculated by dividing the Company’s cost of sales, excluding depletion by the number of attributable gold equivalent ounces. The Company presents average cash cost per attributable gold equivalent ounce as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other streaming and royalty companies in the precious metals mining industry who present results on a similar basis. Cash operating margin is calculated by subtracting the average cash cost per attributable gold equivalent ounce from the average realized gold price per ounce from the Company’s gold streams. The Company presents cash operating margin as it believes that certain investors use this information to evaluate the Company's performance in comparison to other companies in the precious metals mining industry who present results on a similar basis. The Company has also used the non-IFRS financial measure of cash flows from operating activities excluding changes in non-cash working capital. This measure is calculated by adding back the decrease or subtracting the increase in changes in non-cash working capital to or from cash provided by (used in) operating activities. The Company presents cash flows from operating activities excluding changes in non-cash working capital as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other streaming and royalty companies in the precious metals mining industry that present results on a similar basis. Refer to pages 35-38 of the Company’s MD&A for the three months ended March 31, 2022, which is available on SEDAR at www.sedar.com, for a numerical reconciliation of the non-IFRS financial measures described above. The presentation of these non-IFRS financial measures is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these non-IFRS financial measures differently

CONTACT INFORMATION
For more information about Sandstorm Gold Royalties, please visit our website at www.sandstormgold.com or email us at info@sandstormgold.com