TSX:SSL NYSE.MKT:SAND AUGUST 2014

Transcription

1 TSX:SSL NYSE.MKT:SAND E S T D AUGUST 2014

2 CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION Except for the statements of historical fact contained herein, the information presented constitutes "forward-looking statements", within the meaning of the U.S. Securities Act of 1933, the U.S. Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of Sandstorm Gold Ltd. ( Sandstorm ). Forwardlooking statements include, but are not limited to, statements with respect to the future price of gold, the estimation of mineral reserves and resources, realization of mineral reserve estimates, the timing and amount of estimated future production. Forward-looking statements can generally be identified by the use of forward-looking terminology such as may, will, expect, intend, estimate, anticipate, believe, continue, plans, or similar terminology. Forward-looking statements are made based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performances or achievements of Sandstorm to be materially different from future results, performances or achievements expressed or implied by such statements. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which Sandstorm will operate in the future, including the price of gold and anticipated costs. Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements include, amongst others, gold price volatility, discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and development risks relating to the parties which produce the gold Sandstorm will purchase, regulatory restrictions, activities by governmental authorities (including changes in taxation), currency fluctuations, the global economic climate, dilution, share price volatility and competition. Forward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause the actual results, level of activity, performance or achievements of Sandstorm to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: the impact of general business and economic conditions, the absence of control over mining operations from which Sandstorm will purchase gold and risks related to those mining operations, including risks related to international operations, government and environmental regulation, actual results of current exploration activities, conclusions of economic evaluations and changes in project parameters as plans continue to be refined, risks in the marketability of minerals, fluctuations in the price of gold, fluctuation in foreign exchange rates and interest rates, stock market volatility, as well as those factors discussed in the section entitled Risks to Sandstorm in Sandstorm s annual report for the financial year ended December 31, 2012 available at Although Sandstorm has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Sandstorm does not undertake to update any forward looking statements that are contained or incorporated by reference, except in accordance with applicable securities laws. 2

3 THREE REASONS TO OWN SANDSTORM Gold Streaming Advantage Strong Foundation Future Growth Strong returns, lower risk Portfolio of 38 streams and royalties with 14 cash flowing assets Over $165 million in available capital for acquisitions 3

4 STRONG RETURNS, LOWER RISK SECTION ONE 4

5 HOW A GOLD STREAM WORKS Sandstorm provides an upfront cash payment to a mining partner. Upfront Payment Mining Partner Sandstorm receives the right to purchase a percentage of the mine s production at a fixed price per ounce. Mining Partner % of Gold Production Sandstorm sells the gold at spot price and receives a stream of cash flow. 5

6 ADVANTAGES OF STREAMING Exploration Upside with no exploration costs Gold Price Upside with fixed cash costs forever Diversification without ongoing management of assets 6

7 RELATIVE SHARE PRICE PERFORMANCE % Sandstorm Gold Streaming Companies (Silver Wheaton, Royal Gold, Franco-Nevada) Sandstorm Partners Global Gold Index Fund 600% 500% 400% 300% 200% 100% 0% 100% 7

8 Strong Foundation SECTION TWO 8

9 10 Streams 14 Cash Flowing 40,000 50,000 Assets AuEq Ounces in Royalties 60,000 AuEq Ounces per year by

10 64% Cash Flow North America 34% Cash Flow South America 2% Cash Flow South Africa 10

11 SANDSTORM MANAGEMENT TEAM NOLAN WATSON CA, CFA Co-founder, President & CEO DAVID AWRAM B.Sc, Geologist Co-founder & Senior EVP First Two Employees Of Silver Wheaton Involved in Closing Over $2 Billion in Streaming Transactions ERFAN KAZEMI CA, CFA Chief Financial Officer RON HO Vice President, Finance JUSTIN COCHRANE CA, CFA CFA CFA Executive VP, Corp Dev ADAM SPENCER Vice President, Corp Dev 11

12 SANDSTORM TECHNICAL TEAM TOM BRUINGTON P. Eng., M.Sc. EVP, Project Evaluation ROBERT BLAIR Sr. Fellow SEG, GSA Consulting Economic Geologist Tom was the former Chief Engineer at IFC (World Bank Group) and has completed over 100 project evaluations in over 60 countries Robert has 50+ years of experience with exploration/production in major and junior hard rock mining co. s 12

13 NEW GOLD STREAM TRUE GOLD MINING KARMA GOLD STREAM LOCATION Burkina Faso, West Africa TERMS $25 million upfront 5,000 ozs/year for 5 years, 1.6% life of mine gold stream thereafter ONGOING PAYMENTS 20% of the spot price of gold THE MINING SECTOR S FIRST SYNDICATED GOLD STREAM $100 million deal: Sandstorm Gold 25%, Franco Nevada 75% 13

14 KEY GOLD STREAMS PRODUCING AURIZONA GOLD STREAM SANTA ELENA GOLD STREAM BLACK FOX GOLD STREAM PAID CASH FLOW TO DATE PAID CASH FLOW TO DATE PAID CASH FLOW TO DATE $27.8M $44.4M $22M $24.2M $56.3M $50.5M +20y MINE LIFE REMAINING +10y MINE LIFE REMAINING +8y MINE LIFE REMAINING ALL ASSETS BEING DRILLED TO EXTEND MINE LIFE 14

15 OTHER GOLD STREAMS PRODUCING BACHELOR LAKE MING LOCATION QUEBEC, CANADA LOCATION NEWFOUNDLAND, CANADA TERMS $500/OZ TERMS 25% $0/OZ ESTIMATED ANNUAL CASH FLOW $ 8,000,000 ESTIMATED ANNUAL CASH FLOW $ 2,500,000 KEY GOLD ROYALTIES PRODUCING BRACEMAC-MCLEOD GUALCAMAYO EMIGRANT SPRINGS MINE WASTE SOLUTIONS LOCATION LOCATION LOCATION LOCATION QUEBEC, CANADA SAN JUAN, ARGENTINA NEVADA, USA VAAL RIVER, SOUTH AFRICA TERMS TERMS TERMS TERMS 3.0% NSR 1.0% NSR 1.5% NSR 1.0% NSR ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW $ 5,000,000 $ 2,000,000 $ 1,600,000 $ 1,000,000 15

16 OTHER STREAMS & ROYALTIES 16

17 ESTIMATED CASH FLOW US$ 1,300/oz Au $80M $60M $58M 2017 Royalties $40M Other Karma Bachelor Lake $20M Black Fox Santa Elena Aurizona 0 17

18 FUTURE GROWTH SECTION THREE 18

19 AVAILABLE CAPITAL $200M $100M $300M $400M $180M 2015 $230M 2016 $275MAUGSEPOCTNOVDECJANFEBMARAPRMAYJUNJULAUGSEPOCTNOVDECJANFEBMARAPRMAYJUNJULAUGSEPOCTNOVDECCredit Facility Accumulated Cash Balance Warrants Exercised 19

20 WHAT WE LOOK FOR IN A PROJECT Robust Economics Low Cost Producer Exploration Upside WHAT WE LOOK FOR IN A COMPANY Conservative Capital Structure Ability to Raise Capital Experienced Technical Team 20

21 EV/CASH FLOW COMPARISON 11.7 Sandstorm 15.6 Silver Wheaton 18.1 Royal Gold 22.2 Franco Nevada Based on 2016 estimates. Comparators using CapitalIQ estimates on August 11, Sandstorm figures based on Company estimates for EV and Cash Flow. Royal Gold s 2016 cash flow estimates are based on year end June

22 SHARE STRUCTURE Number of Shares Exercise Price There are 19.7 million 2015 warrants outstanding which trade under the symbol SSL.WT.A. Each 5 warrants entitle the holder to purchase 1 common share. Shares Issued & Outstanding Options Warrants (expire October 19, 2015) 117 M 4 M 4 M $4.59 US$5.00 Warrants (expire September 7, 2017) 5 M US$14.00 Other Warrants 2 M varies Fully Diluted 132 M Institutional Holdings Van Eck Associates Sentry Select Capital T. Rowe Price Wells Capital Management GWL Investment Management Shares (millions) % of Shares Outstanding 9.9% 8.1% 4.7% 3.2% 2.7% Total Insiders and Key Shareholders 6.0 5% 22

23 OUR GOAL IS TO BE THE GOLD SECTOR S BEST RISK ADJUSTED, CASH FLOW INVESTMENT VEHICLE. 23