Osisko Gold Royalties Ltd. :OR-US: Earnings Analysis: Q3, 2017 By the Numbers : January 8, 2018

Osisko Gold Royalties Ltd. reports financial results for the quarter ended September 30, 2017.

Highlights

  • Summary numbers: Revenues of USD 54.40 million, Net Earnings of USD 5.37 million.
  • Change in operating cash flow of -82.16% compared to same period last year is about the same as change in earnings, likely no significant movement in accruals or reserves.
  • Narrowing of operating margins contributed to decline in earnings.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2017-09-30 2017-06-30 2017-03-31 2016-12-31 2016-09-30
Relevant Numbers (Quarterly)
Revenues (mil) 54.4 13.65 12.94 10.27 13.47
Revenue Growth (%YOY) 303.84 11.46 13.91 7.09 50.32
Earnings (mil) 5.37 8.21 3.08 6.5 13.61
Earnings Growth (%YOY) -60.57 -32.72 7151.68 88.26 80.43
Net Margin (%) 9.87 60.15 23.8 63.32 101.06
EPS 0.04 0.07 0.03 0.06 0.13
Return on Equity (%) 0.43 0.89 0.34 0.72 1.51
Return on Assets (%) 1.45 3.02 1.16 2.45 5.17

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Market Share Versus Profits

Revenues History
Earnings History

Compared to the same period last year, OR-US’s change in revenue was close to the amount of its change in earnings. It remains to be seen how the rest of its peer group’s results will turn out and if OR-US’s performance is a sign of any major shift in the composition of market share in this sector. Also, for comparison purposes, revenues changed by 298.40% and earnings by -34.64% compared to the previous period.

Cash Versus Earnings – Sustainable Performance?

It is important to examine a company�s cash versus earnings numbers to gauge whether its performance is sustainable.

OR-US’s year-on-year change in operating cash flow of -82.16% is around its change in earnings. This suggests that there are likely no significant movement in accruals or reserves for managing earnings this period.

Margins

The company’s decline in earnings has been influenced by the following factors: (1) Decline in operating margins (EBIT margins) from 54.97% to -0.13% and (2) one-time items that contributed to a decrease in pretax margins from 135.82% to 10.06%

EBIT Margin History
PreTax Margin History

Access our Ratings and Scores for Osisko Gold Royalties Ltd.

Company Profile

Osisko Gold Royalties Ltd. operates as an intermediate precious metal company, which engages in mining and exploration. Its assets portfolio includes Malartic and Éléonore royalties. The company was founded on April 29, 2014 and is headquartered in Montreal, Canada.

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