Q3 2024 Sandstorm Gold Ltd Earnings Call
Streams, and royalties and our silver streams and royalties are turning into fewer gold equivalent ounces.
Gold Equivalent Ounces.
In fact, according to our original budget at the beginning of the year, for which we assumed $1800 per ounce gold prices, we were expecting Q3 gold equivalent production of 20,300 ounces.
Based on the number of ounces of gold and silver and pounds of copper, etc., that we actually received payment for in Q3, if the gold price had averaged $1,800 an ounce like we budgeted, and silver and copper prices were also what we budgeted, the number of gold equivalent ounces we would have recognized in Q3 would have been close to 1,900 ounces.
So we were actually within 6% of budget, if not for the gold price going up and averaging $2,520 per ounce during the quarter. And all that to say, the underlying portfolio is actually performing quite close to what we planned, except for a slower ramp at Greenstone.
And I, for one, am never going to complain about higher gold prices, because not only is it increasing our cash flow, but when you look at all of our major ramp-up growth projects, being Greenstone, Platte Reef, Mara, and Hadmaden, they are all 100% gold streams.
You can see from this slide that 70% of our Q3 revenue is from precious metals, but once all of those assets have been built and we're receiving gold under those new streams, we expect over 85% of our production to be precious metals. So high gold prices means more cash flow now and a bright future for Sandstorm.
In the short term, because gold prices have gone up even further in Q4 compared to Q3, and are now around $2,700 per ounce, we expect this issue to be even more pronounced in Q4, and therefore we're updating our guidance range for the year to between 70,000 and 75,000 ounces.
We'll wait until the early part of Q1 2025 to give guidance for the 2025 year, but even with these strong gold prices, we expect our production to be closer to 80,000 ounces next year because Greenstone is ramping up and our Arizona royalty should be online for a full year.
Over the next five years, we still see our production increasing materially and eventually increasing to 155,000 ounces per annum, which is more than double our current rate of production.
We have significant confidence in our future and our value.
And it's mornings like these where some shareholders are selling shares that are clearly not paying attention to our value.
And when they sell, we're happy buyers of those shares, and we cancel those shares to shrink our share float.
and will likely do so next week once we come out of blackout. We're happy on behalf of shareholders who are paying attention to take advantage of situations like today.
I've been traveling a lot over the past couple of months talking to institutional investors and there is one thing that stood out to me for many of those conversations which is that there is still a material knowledge gap by the investing public about our key development assets the quality of those assets the stage of development of those assets et cetera.
And one conversation I had I was asked by an investor who is the operator of that Rafe.
And when I explained that it was being built by Ivanhoe mines <unk> company with a $20 billion market capitalization, there were surprised to hear that because they were in ivanhoe mines investor and they hadn't heard of <unk>.
I find hard to believe but the reality is we focus on our asset base every single day, and sometimes we forget that other people do not and all that to say, we see an opportunity to provide more information on our current and prospective investors about the key development assets and help keep investors up to date with progress and we're there.
<unk> specifically later on this call David Warren will give a brief update on that mine, which is being constructed now and Dave will also talk a bit about what makes that mine so high quality.
For our other two key development assets being Mara and Hot button. We will also be finding ways to remind investors about their quality and help track their development from plat reef Mara and hard modern we expect the eventual production to be between 70000 to 85000 ounces per year, just from those three streams, which.
Which is as much or more production than we currently have from all 39 of our producing assets.
Therefore understanding the progress of these three assets is key to understanding sandstorm and what will drive our share price in the future.
Mara for example is perhaps the least well understood at these three assets because of its significant estimated mine life of close to 30 years and significant annual estimated contributions to sandstorm between 20000 to 30000 ounces per year, which had spot price with cash flow to sandstorm conservatively well over $1 billion over.
Life. This is set to become the most valuable asset in our portfolio.
And if an asset that Glencore has recently bought a 100% of and has publicly stated they plan on building it.
Be it without giving much guidance as to timing publicly.
<unk> said that recent developments in Argentina have caused major mining companies to start moving forward in Argentina in a major way whether it be BHP entering into $3 billion to $5 billion joint venture with Lundin mining on CLO and Jose Maria or whether it is Rio Tinto is acquisition of our Canadian lithium for $6 7 billion.
Which has its main assets in Catamarca, the same province in Argentina that Glencore is tomorrow project is in <unk>.
One of the reasons for this big push in addition to the change in government.
Theres, a new large investment regime enacted in Argentina. It was enacted this last July which fixes company's tax rates at 25% as well as provides for additional tax advantages, including accelerated depreciation indefinite carryforward tax losses and under specific conditions reduced withholding tax rates on dividends and <unk>.
Cross border payments and provides mechanisms to prevent value added tax from being a financial burden and also under certain circumstances provides exemptions from import and export duties as well as certainties on foreign exchange with the catch is that in order to be eligible you have to start your project by July 2026, which is in a boat.
A year and a half and you have to be done 40% of your construction within the first two years of July 2026, the government is putting the pressure on companies to get these big projects like Monro moving forward and although that's not a guaranteed at Glencore will move my report on that exact timeline, we do think the probability Mara moves forward on a reasonable timeline is high enough that we're continuing to prioritize.
Debt repayment to get ready for the day when the Morro stream option is triggered.
While I'm on the topic of Mara I have received the comment from a few of our institutional investors that they think there is some misinformation in the market about how the timing of our cash payments on the Morrow stream option would work so I'd like to clear it up by emphasizing that at no time, where we have to pay all $225 million upfront when we exercise tomorrow stream Ocean.
Rather the way our agreement works with Glencore is that we pay the upfront deposits slowly over time with them as they construct the mine, which I would expect to take two five to three years and the rate of those payments would be less than our operating cash flow. So at no time do we have to prepare our balance sheet for that payment because he even while were making those.
<unk>, depending on the gold price, we expect to have excess operating cash flow to continue debt repayments or share repurchases.
A new slide that we have added to our presentation is to show our expected 2024 guidance represented by the gold bars here compared to our midcap midcap royalty peers as well as what our growth looks like over the next five years represented by the forest Green bars compared to the same royalty peers and we spin.
Typically highlight the production growth expected from plat reef, which is already in construction and Mara which we think is easy for our investors to wrap their heads around with respect to timing than hard modern.
And you can see from this chart with <unk> alone, we would have similar growth profile to Cisco growing to 120000 ounces per year. So about the same production now similar production in five years, even if automotive is materially delayed.
<unk> is pure upside to those numbers for us to.
To be clear, we still believe hard modern will be moving forward, but a common comment that we get from investors who are paying attention tomorrow as they say I can wrap my head around Glencore building Mara soon but I struggled to know whether SSR will be moving hard modern forward on a timely basis.
Given what's happened to SSR and the time delays Hot Martin has experienced we understand that perspective.
So at Sandstorm, we simply made this slide to say, okay. Even if you take <unk> note, we are still trading at half the market cap for the same production as our closest peer.
Having said all of that we noticed that SSR filed their quarterly financial statements yesterday, and which they disclosed that they spent $10 million on a hot modern during the quarter progressing it which is a ramp up in spend at that asset and I would encourage our investors to keep an eye on those numbers moving forward because they will be an indicator of the behind the scenes progress.
Being made at hot button.
As I've mentioned I've talked with many investors over the past two months and it will be out of town traveling and talking to investors for three of the next five weeks, so I'll get to hear even more feedback.
During those conversations it is clear to me that most investors agree there are four primary reasons, we are trading at that discount.
And I think it's important for investors to understand that these reasons. So they can understand the drivers that will remove them overtime.
The first reason is a legacy that perception when we took on $640 million of debt to do those large deals two years ago.
Our debt is now down to $369 million and dropping quickly and that issue is going away now and we will continue to dissipate further with time.
In fact, I'm, even starting to hear comments from some investors that since the debt is not at all an area of concern anymore. They wish we were buying back more shares.
Although debt repayment is still our primary focus of cash flow.
It's refreshing to hear that sentiment turning as it will help drive our stock price higher.
The second reason relates to Orion mine finance, which became our largest shareholder through the acquisition of Nomad, becoming a 16, 3% shareholder of sandstorm and since they are a private equity fund people knew that is a specific funds that were owned and is coming to an end, but orion would have to sell the shares in sandstorm eventually.
Investors were expecting them to do so in a large secondary offering of their shares at a big discount. Some of you may have noticed and I am happy to report they did not do a large secondary and they have already sold enough shares to get them down below 10%. So this discount will be lifted and as people realize that there is not a large secondary offering coming and we will.
Continue to lift as we find new institutional shareholders to take the remaining shares off Orion says I am very appreciative with how Orion has sold so far and it's been effectively seamless and large block trades to new institutional shareholders.
The third reason I believe we trade at a discount is it some investors are scared that we will ruin that this beautiful setup for sandstorm by doing an equity offering I can assure people that we will not do that.
We have built the portfolio that we are proud of which we can get cash flow from to not only pay down our debt and buy back shares but the portfolio as production has 100% of growth coming in the future I believe that this third issue will take time to dissipate because when we grew sandstorm over the past 15 years for the first 13 years, we needed to raise equity when we found new.
Deals this is no longer the situation.
We have reached a critical mass we have been shrinking our share float and we will either merge our companies sell it or grow organically within our means as we stick to this plan over time I believe people will gain confidence that we have a shrinking share float overtime and not a growing one.
The fourth issue is the one that I'm talking about right now about development projects, specifically that our three key development projects are not as well understood as we would like them to be and therefore people's confidence in them and their timing effects our valuation.
This issue will naturally dissipate as these projects move forward and we find better ways to articulate such progress to shareholders.
Anyway, as I have said for shareholders, who want to understand sandstorm and what will drive our share price going forward. In addition to debt reduction and increasing production from greenstone. It's important to watch the progress of the <unk> mine as it's being built and the progress of Mara and the Hot Mountain project.
Now I'll move on to the third and final item I want to talk about this morning, which is capital allocation plans and debt repayment rates as.
As I've stated in the past our main priority for capital allocation after paying our dividend each quarter is debt repayment with the potential for some share buybacks.
We do not plan on allocating material capital in the next year to new transactions as we continued to focus on debt repayment.
During Q3, our debt repayments of $9 million was slower than in past quarters. However, the rate. We are now repaying our debt is rapidly accelerating and I expect that to continue to accelerate in 2025. Thank.
In Q3, specifically, we had some timing issues with noncash working capital that reduced our operating cash flows by $4 5 million and we bought back $5 2 million of our shares at an average price of $5 50 per share U S, which is materially below our current share price and we canceled those shares and I think those share repurchases at that price.
We're a good allocation of capital.
At the end of the quarter, we had less debt and fewer shares outstanding.
Already in Q4, we can see that our debt repayment is accelerating because we've already repaid $10 million of debt in the first five weeks of Q4 and our debt is now down to $369 million as of today. The reason for this quicker pace of debt reduction is a gold prices are up and we haven't had working capital go against us as well as reduced share repurchases.
With these higher gold prices, our cash flow is increasing.
And as our key development assets come online in the coming years. This will own this will only increase even further.
Can see on this updated slide we show that our cash flow would be after tax once these assets have ramped up calculated both at 'twenty $300 gold as well as $2800 gold and a $2800 gold cash flow gets up to just shy of $300 million per year even.
Even at $2300 gold, which is well below today's gold price, our cash flow would be a quarter of a $1 billion per year.
So we're now in a position where we're expecting production to increase next year as greenstone ramps up our debt is declining at an accelerating rate we have fewer outstanding shares than we did last quarter and last year and we have a large development projects that should be doubling our production and increasing our cash flow in the coming years of those projects Platt reef is already in <unk>.
Speaker Change: Construction and I would expect to see movement in at least one if not both of our other two major development projects over the next 12 to 18 months and with that I'll hand, it over to event.
Nolan: Thanks Nolan.
Speaker Change: Despite lower Geos I would characterize the third quarter financial performance with continued strength in commodity prices driving higher revenues and record operating margin.
Speaker Change: The company recognized revenues of $44 7 million for the three months ended September 32024 supported by higher prices for gold silver and copper.
Speaker Change: At an average realized gold price of 2000 and $520 per attributable ounce the company cash operating margins of $2215 per ounce.
Speaker Change: <unk> a record for the second consecutive quarter this year.
Speaker Change: And with gold prices continuing to reach all time highs thus far in the fourth quarter I expect we will see another record set at the end of this year.
Speaker Change: Of approximately $45 million in revenue $26 7 million was attributable to the company streaming contract and $18 million from royalties.
Speaker Change: Cash flow from operating activities, excluding noncash working capital were $37 million, increasing from $33 9 million in the same period of 2023.
Speaker Change: Net income was $5 8 million compared to close to nil in the third quarter of 2023.
The increase in net income was driven by higher revenue.
Speaker Change: Lower depletion expense, which was in line with the decrease in gold equivalent ounces sold and a $1 $1 million decrease in finance expense related to the company's revolving credit facility.
Speaker Change: Sandstorm made net repayments of $9 million on its revolving credit facility during the third quarter, but as Nolan mentioned, we have made an additional $10 million in repayments. So far in Q4, and our debt balance as of yesterday with $369 million.
Speaker Change: Attributable production for the third quarter was approximately 17400 gold equivalent ounces, which was lower than anticipated, which was in part due to the effect of higher gold prices relative to other commodities.
<unk> outlined earlier.
Speaker Change: However, when comparing year over year production from individual assets. There are few items to highlight.
Speaker Change: And Canada greenstone continues to ramp up and Equinox, just announced commercial production based on operating progress in October.
Speaker Change: Sandstorm received and sold nearly 1200 gold ounces attributable greenstone in the third quarter, which offset a year over year decrease in attributable production from our copper Mountain mine in BC Sandstorm received a true up payment from copper mountain the third quarter of 2023.
Speaker Change: In South America, 55% increase in the number of copper pounds sold from the <unk> copper mine in Brazil, and higher realized copper prices offset a decrease in the number of silver ounces sold from the Cerro Moro mine in Argentina due to expected lower grades as a result of mine sequencing.
Speaker Change: The decrease in silver ounces sold from Cerro Moro was also offset by a 33%.
Speaker Change: Year over year increase in the average realized selling price of silver during the third quarter.
Speaker Change: Stronger royalty revenue was recognized from the future del Norte mine in Ecuador.
Speaker Change: Lundin gold the operator, <unk> del Norte day because.
Speaker Change: Is it really several impressive drill results from the 2020 for near mine drilling program, which includes intercepts from the new bonds through gold deposit.
Speaker Change: Metallurgical study is planned for 2024, and a maiden mineral resource estimate for bonds, a sewer deposit is expected by mid 2025.
Speaker Change: At the <unk> mine in Brazil, Equinox gold resume mining following the displacement of material at the <unk> pit in the first quarter following persistent heavy rain.
Speaker Change: Royalty revenues attributable sandstorm in the second and third quarters of 2024 would negatively affected.
The processing plant or zona with idle for May and June.
Speaker Change: <unk> began mining at the <unk> pit in May which was originally scheduled to commence in the fourth quarter.
Speaker Change: The <unk> pit, which is within Samsung royalty claim is expected to provide most of the ore feed for the remainder of 2024.
The bond accrual Gulfstream in Cote d'ivoire drove increased production attributable to minds outside of the Americas.
Speaker Change: Following the closing of the third party financing package Allied gold on a cruise operator plans to allocate a total of $16 5 million in 2024 to advance high priority targets located within sandstones Monaco stream claim.
Speaker Change: Allied expects to accelerate projects that aimed to optimize operations extend mine life and increase asset value by unlocking additional upside potential.
Speaker Change: These are just a few highlights from the 41 producing mines underlying our financial performance this quarter.
Speaker Change: Can you to be impressed with sandstorms portfolio of assets.
Speaker Change: And we look forward to certain key development mines ramp up and come online in 2025 and beyond.
Speaker Change: Nolan discussed in detail based on the company's existing streams and royalties and year to date outperformance of gold price relative to other commodities. We are forecasting attributable gold equivalent ounces for 2024 to be between 70000 75000 gold equivalent ounces.
Speaker Change: We continue to anticipate sandstorms production forecast to reach approximately 125000 attributable ounces within the next five years based solely on streams and royalties are the company has already bought and paid for.
Speaker Change: And with that I'll turn it over to Dave to discuss one of our key development asset Dave.
Thanks, Stefan and good morning, everyone today's asset update will focus exclusively on the <unk> project.
Dave: As <unk> stated earlier Ivanhoe is well known mine builder and operating ranking among the best in the World. However, due to their focus on operations in the DRC.
Dave: <unk> project tends to get less attention, even though it is truly a game changer in the PGM space.
Dave: <unk> is situated on the northern limb of South Africa's Bushveld complex a region renowned for its rich deposits of platinum group metals considered a key disruptor in the PJM World. It is a testament to modern mining innovation at geologic excellence the.
Dave: The deposit is considered to be the world's largest precious metal development with approximately 400000 ounces per year production. Once phase two concentrated are up and operational potentially increasing to over twice that amount in pgm's gold when phase three is active.
Dave: The plant reef ore body is characterized.
Dave: But it's substantial thickness and flatline nature, which is quite different from the steeply dipping Moran ski and <unk> found on the eastern and western limbs of the Bushveld complex.
Dave: <unk> boasts a massive 26 meters thick or body, making it highly amenable to mechanized mining methods.
Dave: This photo to the right you can see how that thickness compares to the 29 meter height of the shaft one head frame.
Dave: This thickness is exceptional when compared to the typical one meter thick <unk> reef.
Dave: Plant reef is rich in a variety of metals contain significant quantities of platinum palladium rhodium and gold along with notable amounts of nickel and copper.
Dave: This diverse mineral compositions sets it apart from the <unk>, which primarily reads platinum palladium with minimal base metals.
Dave: The flat line nature of plowed reef allows for the use of larger tonnage mechanized mining techniques not only this not only enhances safety and efficiency, but also reduces the environmental footprint of the mining operations.
Dave: Contrast, <unk> narrow and steeply dipping ore bodies, often required more labor intensive intensive and less mechanized mining methods.
Dave: What I'm pointing out is that compared to all other south African PGM producers Platt reef is head and shoulders above the competition, both safety and efficiency, which is reflected in the industry cost curve that you will see later on.
Dave: Moving on now to wear Ivanhoe is in progress phase. One construction is largely finished with the completed concentrated now in cold commissioning stage.
The concentrator will be placed on care and maintenance until each.
Second half of 2025 shaft, one prioritizes the hoist scene of waste from the development required to bring forward the <unk>.
Dave: Started phase two operations.
Dave: Work continues on the updated feasibility study to accelerate <unk> phase II as well as the preliminary economic assessment of the new phase III expansion. Both studies are expected to be published in Q1 of 2025.
Dave: Remainder of the five one meter diameter shaft three from the 950 meter level was recently completed and equipping has commenced chefs III is expected to commence hoisting in Q1 2026 with a capacity of approximately four.
Dave: <unk> tons per annum together with the current operating shaft. One total annual hoisting capacity is expected to be 5 million tonnes per annum.
Dave: Additional underground ventilation will now be provided by the new five one meter diameter shaft named shaft four shaft five <unk>.
Dave: Drilling a pilot hole for shaft four is complete with the <unk> expect it to start imminently.
Dave: Civil construction of shaft for substation building and ventilation fans are advancing well geotechnical drilling has commenced on the proposed shaft five site.
Dave: The installation of the 1000 102004 tons of internal structural steel and shot site shaft, two which see a picture of right here head.
Dave: Headframe continue Pat during the past quarter as well as the installation of the winders and related infrastructure.
Dave: <unk> of shaft two to an initial diameter. Three one is progressing well with approximately 100 meters remaining and completion expected in the coming weeks expansion of the shaft to the final diameter of 10 meters will commence in late 2025, the completion of shaft two will increase.
Dave: Total hoisting capacity for ore and waste development across all sheet, three chefs to 12 million tons per annum.
Speaker Change: A lot of discussion about shafts I can tell you.
Speaker Change: Construction of <unk> first five megawatt solar power facility is expected to be complete by year end the power generated by the shaft will support development activities and operations together with other renewable energy sources that are expected to be introduced over time.
Speaker Change: In summary, the plant re project is poised to become one of the worlds largest and lowest cost producers of pjm's nickel copper and gold.
Speaker Change: The geologic features.
Modern mining technique, not only distinguish us from more traditional murasky re projects, but will position it as a leader in the mining industry.
Speaker Change: For sandstorm, 30% gold stream means about 10000 ounces per year when phase two starts.
Speaker Change: When they move to the 10 million tons per annum of phase III that represents 15% to 20000 ounces per year for sandstorm.
Speaker Change: While at that 30% threshold of the Gulfstream.
Speaker Change: The bottom line is that moving up the timing of phase two at <unk> has big implications for gold coming to sandstorm certainty on phase III will also help crystallize longer term goals.
Speaker Change: While estimates as well.
Speaker Change: <unk> still has the opportunity to be one of the biggest contributors of growth to <unk> portfolio.
With that I'll hand over the call back to Joanna the operator for our Q&A session and pleased again feel free to ask questions about any of our royalties and streams.
Joanna: Thank you.
Joanna: Ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the one on your Touchtone phone you will hear a contract you had has been raised.
If you are using a speaker phone. Please let the handset before pressing any case.
Speaker Change: Your first question comes from Heiko Ely at H C. Wainwright. Please go ahead.
Speaker Change: Hey, there happy Friday I Hope you guys are hearing me okay.
Speaker Change: Yes Heiko.
Speaker Change: Okay, Perfect Hey earlier on this call you mentioned the material investing knowledge gap in the market.
Speaker Change: Conceptually I'm trying to figure out how we and by we I mean, you and the analyst community can make this go away or at least you will decrease the effect of it.
Speaker Change: Can you maybe provide some color on what people are actually missing I mean, you hinted at the fact that some people might not even pointing off credence into the fact that the operators are large scale size et cetera, but besides that I mean, how do you think the analyst community and for that matter of Sandstorm personnel should go about making this more clear.
Speaker Change: Sure.
Speaker Change: As you know from my research I see that same gap between the share price and the inherent value of the company as well.
Speaker Change: Yes, I think really theirs.
Speaker Change: In terms of what we can do going forward I think is a number of things including <unk>.
Speaker Change: Speaking about them more often providing more clarity as to what stages. They are at providing more materials for investors not just for institutional investors, but it is a retail investors as well.
Speaker Change: Videos presentations, we believe we're going to do our at Investor day for the first time.
Speaker Change: In 2025 and are going to put a significant focus on helping people understand those things with graphics that they can then use going forward and then we'll keep the market up to date with so I think.
Speaker Change: The ball is largely in our court to articulate those things better let me to a certain extent, we're always going to have challenges with articulating those things.
Speaker Change: The streaming and royalty model is a little different than mining company, specifically, because we appeal more to a generalist investor and Theyre just generally less educated as to what is going on in the mining community.
Speaker Change: So thats just that much more important for us to articulate it well.
Speaker Change: Fair enough.
Little of different question, given the election within the U S anything in part and lead US has changed with you in regards to your internal willing us to take certain risks any changes to your internal hurdle in discount rates I mean, obviously the longer term bonds have gone up a little bit this week anything that you changed it.
Speaker Change: Apply the certain assets countries et cetera, as much color as youre willing and able to provide on the public call like this.
I would say generally speaking in the short term no in the sense that we don't plan on doing any material deals in the next year or potentially two years that we don't really have to wrap our heads around what rates of return that we would be buying things out because we don't put up buying things, we plan on paying down debt and buying back our shares and getting ready to.
Speaker Change: Size of the MRO stream option I would say in the longer term.
Speaker Change: Looking at the gold markets.
Speaker Change: So it's anyone's guess, what's going to happen I do believe that significantly increased deficits in the U S are going to accelerate peoples.
Speaker Change: Purchases of goals over the longer term because it's just.
Speaker Change: There is an impending sensors.
Speaker Change: Ending of the ability of the U S government to borrow at these rates and that's going to come to a head faster.
Speaker Change: So more bullish on gold, but not really changing the way we think about acquisitions.
Speaker Change: Manuel.
Thanks, So much I am looking forward to attending our analyst day next year and I'll get back in queue.
Speaker Change: Thank you.
Speaker Change: Thank you next question comes from Derek Kumar TT Cowen. Please go ahead.
Derek Kumar: Thank you and apologies if I missed this earlier in the call, how lufthansa and balance the capital allocation between debt reduction and share repurchases.
Derek Kumar: And does the falling interest rate environment change your views in terms of where you ultimately want to end up with the debt.
Speaker Change: Over the longer term I think.
Speaker Change: Falling interest rates do affect us it doesn't really affect us that much quarter to quarter corporate <unk> point, there is moving the needle.
Speaker Change: Dramatically from the fact that we want to use the bulk of our cash flows for debt reduction.
Speaker Change: Last quarter, we bought back $5 million worth of shares payback by $1 million of debt I think just because of a number of things that happen like working capital going against us last quarter and a couple of other things some small investments we made debt.
Speaker Change: Debt reduction was lower than what you see in future quarters unexpected by Q1 debt reduction to accelerate to close to $30 billion, a quarter and the share buybacks to be somewhere between zero to $5 million this quarter.
Speaker Change: Okay, great. Thank you that answers my question.
Speaker Change: Thank you, ladies and gentlemen, as a reminder, should you have any questions. Please press star one.
Speaker Change: Next question comes from Adam <unk> of Scotiabank. Please go ahead.
Speaker Change: Good morning, and thank you for taking my question.
Speaker Change: I know you mentioned that your priority right now is debt repayments on share buy bulk.
Speaker Change: Yes, previously advised or some time.
Speaker Change: You are also looking at transactions.
Speaker Change: We then Andre and alien to us.
Speaker Change: No.
Just to be sure to be clear you are not looking at anything any sort of transactions.
Speaker Change: Nothing in your transactional pipeline.
Speaker Change: For the next year.
Speaker Change: Just to be clear. So we always look at what is out there to make sure that we're not missing anything. So we are looking to the extent to making sure we don't Miss anything but are <unk>.
Our objective is debt reduction versus share buyback second and we don't see anything out there that makes us want to change that plan.
But of course, the exception to that is really that Mara project and really that option that's available to us it's already priced out we know what it's going to cost.
Speaker Change: If that were the only thing that we're looking at clearly that helps.
Speaker Change: And that will be.
Speaker Change: The best deal in the streaming space going forward between now and the next several years.
Speaker Change: Okay got it.
Speaker Change: When we then where youre looking at like currency, what would you see.
Okay. I know you said it doesn't make sense, what youre seeing doesn't really make.
Makes sense.
Speaker Change: One of jumping book can you give an infusion into what youre sort of seeing.
Speaker Change: In terms of the deal.
Speaker Change: James or something.
Speaker Change: So I'll be more clear, we don't plan on doing any material deals in the next year other than exercising Morris III motion, if and when it is given to US we will reevaluate that exactly.
Speaker Change: Alright. Thank you thanks for taking.
Speaker Change: Okay.
Speaker Change: Thank you. The next question is a follow up from Derick MA at TD Cowen. Please go ahead.
Speaker Change: I wanted to ask one question on <unk> could you piece together for us what's happening with entre the arbitration and the ultimate impact can it have on Panther and how you think that's going to resolve itself.
Speaker Change: Yes, maybe I'll hand, it over to her fan is very close to that situation.
Speaker Change: Yes. Thanks for the question Derrick from what I understand is.
Speaker Change: Entre has.
Speaker Change: Continued the arbitration proceedings with <unk> with respect to the transfer of those licenses under the proposed JV.
Speaker Change: I understand there's been some speculation in the market.
Speaker Change: What that means but as I understand it they continue to move forward on that basis and these things can take time with respect to its impact on sandstorm.
<unk> is directly with entre and has certain rights and protections under that stream and I think having further clarity on moving move licenses will be a net benefit but in the long run will impact the timing of expectation of the cash flows that sandstorm expect.
Speaker Change: Alright.
Speaker Change: Yes go ahead, sorry, I was just going to say what I would add to that is Andre just recently put out some drill results.
Speaker Change: This week that were.
We put them in the leapfrog and are very very exciting drill results to understand sort of where they are the deposit I think that my conclusion to takeaway from that is at sandstorm can expect a lot more.
Speaker Change: Gold and copper production under the stream that we have that we were previously anticipating.
Speaker Change: Okay, and then commenced underground development on the JV ground. So it's really about transferring the license.
Speaker Change: Uh huh.
Is that correct, yes, yes.
Speaker Change: Yes, yes, okay. Okay. Thank you.
Speaker Change: Thank you we have no further questions I will turn the call back over to Mr. Watson for closing comments.
Mr. Watson: Alright, Thank you everyone for calling into our call and as always we're here and feel free to give US questions. If you can ask them on this call and have a great day.
Speaker Change: Ladies and gentlemen. This concludes your conference for today, we thank you for participating and we ask that you. Please disconnect your lines.
Speaker Change: Okay.