Some Production Misses but Strong Revenues
Contributed Opinion

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Several of the companies that have pre-released their fourth-quarter results so far, including the mid-tier royalty companies, mostly missed on production, but met annual guidance for the most part.

And the strong gold and silver prices saw strong revenues, with companies using the cash to reduce debt and buy back stock. There are several positive developments on projects expected this year.

Or Meets Full-Year Guidance

OR Royalties (OR:TSX; OR:NYSE) released fourth-quarter operating results ahead of full financials, with GEO deliveries slightly disappointing. However, for the year, OR met its guidance, albeit close to the lower end.

The company said it had repurchased another almost 37 million shares during the last quarter, and ended the quarter with $142 million in cash and an undrawn credit facility of $850 million.

So OR is in a strong financial shape with the ability to do sizeable transactions.

Hold.

Triple Flag Sees Ninth Record Year

Triple Flag Precious Metals Corp. (TFPM:TSX; TFPM:NYSE) also reported preliminary results, again slightly below expectations.

Nonetheless, it was at the high end of its guidance for the full year, with its ninth consecutive year of record GEOs (and of course record revenue).

Separately, Triple Flag's major shareholder, Elliott Management, is selling 2.77 million shares in an arranged sale.

Following the transaction, Elliott will hold just under 65% of the shares outstanding in Triple Flag, adding that it "does not have any specific plan or intention to … dispose of" additional shares. Hold.

Cautiously Positive Panama News for Franco

Franco-Nevada Corp. (FNV:TSX; FNV:NYSE) typically does not release partial results, but it did receive positive news out of Panama.

The government has approved plans to process stockpiled ore at Cobre Panama, on which Franco holds a stream, that could amount to 70kt of copper production.

First Quantum, the operating company, noted that this does not constitute a reopening of the mine, which was ordered shut in late 2023. Nonetheless, the stockpile represents additional income to Franco.

The government has said it will make a decision by June on the future of the mine. We expect the mine to reopen, though under what conditions is uncertain.

Since Franco has written off its investment and has no revenue currently in its guidance, any restart of mining will be a positive.

Hold.

Royal Pays Down Debt as Results Beat

Royal Gold Inc. (RGLD:NASDAQ) reported its fourth-quarter streaming results, representing about 70% of its overall GEO; they were positive.

The company continues to pay down its debt, taken on for two large transactions in mid-year, repaying $325 million during the quarter, with an additional $75 million so far this month.

The outstanding balance is $825 million. We expect Royal to continue to pay down its debt and build up its cash, but, with $575 million undrawn on its credit line, it certainly could do another large transaction.

Hold.

Fortuna Sees Lower Production and Higher Costs This Year, but Not Unexpected

Fortuna Mining Corp. (FSM:NYSE; FVI:TSX; FVI:BVL; F4S:FSE) reported fourth-quarter production below estimates, though annual production met the company's guidance.

The problem in the last quarter was crusher downtime at the Lindero mine in Argentina, partly offset by strong performance at the flagship Séguéla mine in Cȏte d'Ivoire. The company also announced guidance for this year of 281-305k oz gold equivalent, down from last year after the closing of two mines, at AISC costs of between $1,680 and $1,765, up from last year.

The company had already indicated that the year would see higher costs, though they are coming down from the high third-quarter numbers. However, the guidance, perhaps conservative, is higher than anticipated. The company's mine is reportedly now subject to a flat 8% government royalty in Cȏte d'Ivoire, up from the previous 3-6% sliding scale. This year will see a mill expansion at Séguéla and a construction decision at Diamba Sud (expected to be positive). It said that 500,000 ounces production a year remains its goal.

Separately, Fortuna said that in the two weeks either side of the New Year, it had repurchased 1.7 million shares, at an average cost of $10.01 per share.

Fortuna remains a Buy, preferably on any pullback.

Altius' Junior Portfolio Gearing up Activity

Altius Minerals Corp. (ALS:TSX) reported the value of its junior equities portfolio increased by $5 million during the quarter, including net investments of $1.3 million.

The companies within the portfolio, on most of which Altius holds a royalty, will be active this year with drilling programs.

Altius is a core position for us; Hold.

Nestlé Issues Worldwide Baby Formula Recall

Nestle SA (NESN:VX; NSRGY:OTC) issued a worldwide recall of some of its baby formula that it said may have included toxic ingredients, adding that there had been no confirmed reports of illness tied to the products.

However, incidents like this can worsen over time.

The recall started relatively small, with only certain brands and certain countries affected, but quickly widened to several brands in most countries.

Hold.

Midland Continues To Be Active

Midland Exploration Inc. (MD:TSX.V) said that Rio Tinto Plc. (RIO:NYSE; RIO:ASX; RIO:LSE; RTNTF:OTCMKTS) had returned to Midland certain projects in the companies' alliance, primarily focused on lithium, following the 2025 exploration campaign.

On other parts of the ground covered by the alliance, there was significant drilling with positive results. Separately, Midland announced commencement of drilling on its 100%-owned Jouvex gold project in the Abitibi.

Midland is an active Quebec-focused exploration company, with a strong technical team and solid balance sheet, top partners, and multiple projects.

It remains a Buy.

TOP BUYS this week include Lara Exploration Ltd. (LRA:TSX.V).