Dow Jones, Nasdaq, S&P 500 weekly preview: Big earnings week on tap after pullback
Introduction & Market Context
Osisko Gold Royalties Ltd (NYSE & TSX:NYSE:OR) presented its Q1 2025 financial results on May 8, 2025, highlighting strong revenue and earnings growth despite lower production volumes. The company benefited significantly from higher gold prices, which offset a year-over-year decrease in gold equivalent ounces (GEOs) produced.
The precious metals royalty company’s stock has shown strong performance over the past year, trading near its 52-week high of $24.23. However, in premarket trading following the results, shares were down 4.09% to $23.00, suggesting some investor caution despite the positive financial metrics.
Quarterly Performance Highlights
Osisko reported 19,014 Gold Equivalent Ounces earned in Q1 2025, down from 22,259 in the same period last year. Despite this 14.6% decrease in production, the company achieved substantial growth in key financial metrics, primarily due to higher realized gold prices.
As shown in the following quarterly highlights:
The company maintained an impressive quarterly cash margin of 97.1%, slightly up from 97.0% in Q1 2024, demonstrating the strength of its royalty and streaming business model. This high margin is a key differentiator for Osisko, as highlighted in their competitive positioning.
Detailed Financial Analysis
Osisko’s financial performance showed significant improvement across all key metrics compared to the same period last year. Revenues increased to $54.9 million, up 22% from $45.0 million in Q1 2024, while net earnings more than doubled to $25.6 million ($0.14 per basic share) from $11.2 million ($0.06 per basic share).
The following chart illustrates the company’s financial performance comparison:
Cash flows from operating activities also showed strong growth, reaching $46.1 million ($0.25 per basic share) compared to $37.4 million ($0.20 per basic share) in Q1 2024, representing a 23.3% increase. Adjusted earnings rose to $29.5 million ($0.16 per basic share), up 34% from $22.0 million ($0.12 per basic share) in the prior year.
The company’s balance sheet remains solid with a cash balance of $63.1 million and net debt of approximately $11.3 million as of March 31, 2025. Based on this strong financial position, Osisko declared a Q2 2025 quarterly dividend of US$0.055 per common share, representing a 20% increase over the previous quarter’s dividend.
Asset Portfolio & Production Analysis
Osisko’s production is well-diversified across multiple assets, with Canadian Malartic remaining the largest contributor at 7,198 GEOs in Q1 2025. By commodity, gold constitutes 67.7% of production, with silver at 28.4% and copper and other metals at 3.9%.
The following breakdown shows the contribution from each asset and commodity:
The company’s portfolio is heavily focused on precious metals (96.1%) and primarily consists of assets in Tier-1 mining jurisdictions, which provides lower geopolitical risk compared to peers. This strategic positioning is illustrated in the following slide:
Osisko claims to have the highest exposure to Tier-1 mining jurisdictions versus peers, with 78% of GEOs earned in 2024 coming from these premium locations. The company also highlighted that its cash margin was 11.9% higher than the average of its relevant peer set in 2024, with shareholders earning approximately $0.97 of every dollar of revenue generated.
Growth Outlook & Strategic Initiatives
Despite the lower Q1 production, Osisko confirmed it is still tracking well against its 2025 GEO delivery guidance of 80,000-88,000 ounces, with sequential quarter-over-quarter growth expected. The company’s five-year outlook projects significant growth, targeting 110,000-125,000 GEOs by 2029.
The following chart illustrates this growth trajectory:
The Canadian Malartic Complex remains Osisko’s flagship asset, representing a royalty on Canada’s second-largest operating gold mine. Production is expected from the Barnat Pit until 2028 and from the Odyssey underground project, which is expected to reach steady-state production of 500-600koz of gold per year starting in 2028/29.
Additional growth opportunities include the fully-permitted Cariboo project in British Columbia, which features a 5.0% NSR royalty for Osisko. According to the recently released Optimized Feasibility Study, the project is expected to produce an average of approximately 190,000 ounces of gold annually.
Forward-Looking Statements
While Osisko’s presentation painted a positive picture of both current performance and future prospects, investors should note that the company’s premarket trading showed a decline of 4.09%, suggesting some market skepticism or profit-taking following the results.
The company’s ability to maintain its 2025 guidance despite lower Q1 production implies an expectation of increased production in subsequent quarters. This will be a key area for investors to monitor in upcoming reports.
Osisko’s competitive positioning appears strong, with its high exposure to Tier-1 mining jurisdictions and industry-leading cash margins. The company’s balance sheet remains solid, allowing for continued dividend growth and potential new acquisitions to further enhance its royalty and streaming portfolio.
As gold prices remain elevated, Osisko is well-positioned to continue benefiting from this favorable pricing environment, even if production volumes fluctuate quarter to quarter.
Full presentation:
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