Royal Gold Earnings: Streak of Four Straight Profit Increases Snapped

Royal Gold Inc. (NASDAQ:RGLD) reported its results for the fourth quarter. Royal Gold, together with its subsidiaries, is engaged in the business of acquiring and managing precious metals royalties.

Investing Insights: Is TV the Next Bullish Catalyst for Apple’s Stock?

Royal Gold Inc. Earnings Cheat Sheet

Results: Net income for Royal Gold Inc. fell to $20.6 million (34 cents per share) vs. $21.7 million (39 cents per share) a year earlier. This is a decline of 5% from the year-earlier quarter.

Revenue: Rose 1.2% to $60 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Royal Gold Inc. fell short of the mean analyst estimate of 45 cents per share. It fell short of the average revenue estimate of $69.4 million.

Quoting Management: Tony Jensen, President and CEO, commented, “Fiscal 2012 marks the 11th consecutive year of record revenue and cash flow for Royal Gold. Our current financial results were driven by new and increasing production from recently commissioned mines, steady performance from our diversified royalty portfolio, and a continuation of strong metal prices. Revenue from our three producing cornerstone properties increased 31% as Peasquito and Andacollo approached design capacity and Voisey’s Bay maintained steady state production. On top of this, we realized full-year production from Canadian Malartic, Holt, Las Cruces and Wolverine, further increasing our revenue base. During the fiscal year, we also added three new assets to our portfolio, and strengthened our balance sheet. We remain well positioned for new business opportunities as we move into fiscal 2013.”

Key Stats:

Last quarter’s profit decrease breaks a streak of four consecutive quarters of year-over-year profit increases. In the third quarter, net income rose 32.9% from the year earlier, while the figure increased 27.8% in the second quarter, 90.1% in the first quarter and more than twofold in the fourth quarter of the last fiscal year.

Revenue has increased for four consecutive quarters. Revenue increased 25.4% to $69.6 million in the third quarter. The figure rose 22.2% in the second quarter from the year earlier and climbed 42.2% in the first quarter from the year-ago quarter.

The company has now fallen short of analyst estimates for the last three quarters. It missed the mark by 5 cents in the third quarter and by 6 cents in the second quarter.

Looking Forward: The average estimate for the first quarter of the next fiscal year is steady at 50 cents a share. For the fiscal year, the average estimate has moved down from $1.82 a share to $1.75 over the last ninety days.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

Don’t Miss These Additional Hot Stories:

Priceline: Here’s What Happens When Momentum Stocks ATTACK!

Is Caterpillar’s Stock a Buy?

Is This Amazon’s Newest ENEMY?

More from The Cheat Sheet