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1.OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Royal Gold, Inc. (“Royal Gold”, the “Company”, “we”, “us”, or “our”), together with its subsidiaries, is engaged in the business of acquiring and managing precious metals royalties, metal streams, and similar interests. Royalties are non-operating interests in mining projects that provide the right to revenue or metals produced from the project after deducting specified costs, if any. A metal stream is a purchase agreement that provides, in exchange for an upfront deposit payment, the right to purchase all or a portion of one or more metals produced from a mine, at a price determined for the life of the transaction by the purchase agreement.
Summary of Significant Accounting Policies
The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, all adjustments which are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in this Form 10-Q. Operating results for the three and six months ended December 31, 2014, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2015. These interim unaudited financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2014 filed with the Securities and Exchange Commission on August 7, 2014 (“Fiscal 2014 10-K”).
Asset Impairment
We evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts of an asset or group of assets may not be recoverable. The recoverability of the carrying value of royalty and stream interests in production and development stage mineral properties is evaluated based upon estimated future undiscounted net cash flows from each royalty and stream interest property using estimates of proven and probable reserves and other relevant information received from the operators. We evaluate the recoverability of the carrying value of royalty interests in exploration stage mineral properties in the event of significant decreases in the price of gold, silver, copper, nickel and other metals, and whenever new information regarding the mineral properties is obtained from the operator indicating that production will not likely occur or may be reduced in the future, thus affecting the future recoverability of our royalty interests. Impairments in the carrying value of each property are measured and recorded to the extent that the carrying value in each property exceeds its estimated fair value, which is generally calculated using estimated future discounted cash flows.
Our estimates of gold, silver, copper, nickel and other metal prices, operators’ estimates of proven and probable reserves related to our royalty or streaming properties, and operators’ estimates of operating, capital and reclamation costs are subject to certain risks and uncertainties which may affect the recoverability of our investment in these royalty and stream interests in mineral properties. Although we have made our best assessment of these factors based on current market conditions, it is possible that changes could occur, which could adversely affect the net cash flows expected to be generated from these royalty and stream interests. Refer to Note 3 for discussion and the results of our quarterly impairment assessments for the three and six months ended December 31, 2014.
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2.ACQUISITIONS
Acquisition of Gold Stream on Euromax’s Ilovitza Project
On October 20, 2014, RGLD Gold AG (“RGLD Gold”), a wholly owned subsidiary of the Company, entered into a $175.0 million gold stream transaction with Euromax Resources Ltd (“Euromax”) that will finance a definitive feasibility study, permitting work, early stage engineering and a significant portion of the construction at Euromax’s Ilovitza gold-copper project located in southeast Macedonia. RGLD Gold will make two advance deposit payments to Euromax totaling $15.0 million, which will be used for completion of the definitive feasibility study and permitting of the project, followed by payments aggregating $160 million towards project construction, in each case subject to certain conditions. Payment of the first $7.5 million deposit is conditioned upon Euromax raising an additional $5 million in equity, which was completed in January 2015, and the satisfaction of certain other conditions. RGLD Gold’s decision to proceed with the second $7.5 million deposit and the construction payments is conditioned upon, among other things, its satisfaction with the progress of definitive feasibility study and environmental evaluations, demonstrated project viability, and, in the case of the construction payments, sufficient project financing and permits to construct and operate the mine. The construction payments would be paid pro-rata with the balance of the project funding. In exchange, Euromax will deliver physical gold equal to 25% of gold produced from the Ilovitza project until 525,000 ounces have been delivered, and 12.5% thereafter (in each case subject to adjustment). RGLD Gold’s purchase price per ounce will be 25% of the spot price at the time of delivery.
Tetlin Royalty Acquisitions
On September 30, 2014, Royal Gold acquired a 2.0% net smelter return (“NSR”) royalty and a 3.0% NSR royalty held by private parties over areas comprising the Tetlin gold project located near Tok, Alaska, for total consideration of $6.0 million. As discussed in Note 13, the Tetlin gold project is now held by Peak Gold LLC (“Peak Gold”), a joint venture between subsidiaries of Royal Gold and Contango Ore Inc.
The acquisition of the Tetlin royalties has been accounted for as an asset acquisition. The total purchase price of $6.0 million, plus direct transaction costs, has been recorded as an exploration stage royalty interest within Royalty and stream interests, net on our consolidated balance sheets.
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3.ROYALTY AND STREAM INTERESTS
The following tables summarize the Company’s royalty and stream interests as of December 31, 2014 and June 30, 2014.
As of December 31, 2014 (Amounts in thousands): |
|
Cost |
|
Accumulated |
|
Impairments |
|
Net |
|
||||
Production stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Andacollo |
|
$ |
272,998 |
|
$ |
(60,892 |
) |
$ |
— |
|
$ |
212,106 |
|
Voisey’s Bay |
|
150,138 |
|
(73,262 |
) |
— |
|
76,876 |
|
||||
Peñasquito |
|
99,172 |
|
(20,716 |
) |
— |
|
78,456 |
|
||||
Mulatos |
|
48,092 |
|
(30,226 |
) |
— |
|
17,866 |
|
||||
Holt |
|
34,612 |
|
(12,184 |
) |
— |
|
22,428 |
|
||||
Robinson |
|
17,825 |
|
(12,291 |
) |
— |
|
5,534 |
|
||||
Cortez |
|
10,630 |
|
(9,844 |
) |
— |
|
786 |
|
||||
Other |
|
491,689 |
|
(246,936 |
) |
(27,586 |
) |
217,167 |
|
||||
Total production stage royalty interests |
|
1,125,156 |
|
(466,351 |
) |
(27,586 |
) |
631,219 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Production stage stream interests: |
|
|
|
|
|
|
|
|
|
||||
Mount Milligan |
|
783,046 |
|
(18,740 |
) |
— |
|
764,306 |
|
||||
Total production stage royalty and stream interests |
|
1,908,202 |
|
(485,091 |
) |
(27,586 |
) |
1,395,525 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Development stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Pascua-Lama |
|
372,105 |
|
— |
|
— |
|
372,105 |
|
||||
Other |
|
71,092 |
|
— |
|
— |
|
71,092 |
|
||||
Total development stage royalty interests |
|
443,197 |
|
— |
|
— |
|
443,197 |
|
||||
Total development stage stream interests |
|
63,331 |
|
— |
|
(603 |
) |
62,728 |
|
||||
Total development stage royalty and stream interests |
|
506,528 |
|
— |
|
(603 |
) |
505,925 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Exploration stage royalty interests |
|
165,852 |
|
— |
|
(150 |
) |
165,702 |
|
||||
Total royalty and stream interests |
|
$ |
2,580,582 |
|
$ |
(485,091 |
) |
$ |
(28,339 |
) |
$ |
2,067,152 |
|
As of June 30, 2014 (Amounts in thousands): |
|
Cost |
|
Accumulated |
|
Impairments |
|
Net |
|
||||
Production stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Andacollo |
|
$ |
272,998 |
|
$ |
(56,147 |
) |
$ |
— |
|
$ |
216,851 |
|
Voisey’s Bay |
|
150,138 |
|
(67,377 |
) |
— |
|
82,761 |
|
||||
Peñasquito |
|
99,172 |
|
(17,801 |
) |
— |
|
81,371 |
|
||||
Mulatos |
|
48,092 |
|
(28,548 |
) |
|
|
19,544 |
|
||||
Holt |
|
34,612 |
|
(10,474 |
) |
— |
|
24,138 |
|
||||
Robinson |
|
17,825 |
|
(11,887 |
) |
|
|
5,938 |
|
||||
Cortez |
|
10,630 |
|
(9,772 |
) |
— |
|
858 |
|
||||
Other |
|
488,309 |
|
(232,913 |
) |
— |
|
255,396 |
|
||||
Total production stage royalty interests |
|
1,121,776 |
|
(434,919 |
) |
— |
|
686,857 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Production stage stream interests: |
|
|
|
|
|
|
|
|
|
||||
Mount Milligan |
|
783,046 |
|
(7,741 |
) |
— |
|
775,305 |
|
||||
Total production stage royalty and stream interests |
|
1,904,822 |
|
(442,660 |
) |
— |
|
1,462,162 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Development stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Pascua-Lama |
|
372,105 |
|
— |
|
— |
|
372,105 |
|
||||
Other |
|
69,488 |
|
— |
|
— |
|
69,488 |
|
||||
Total development stage royalty interests |
|
441,593 |
|
— |
|
— |
|
441,593 |
|
||||
Total development stage stream interests |
|
41,103 |
|
— |
|
— |
|
41,103 |
|
||||
Total development stage royalty and stream interests |
|
482,696 |
|
— |
|
— |
|
482,696 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Exploration stage royalty interests |
|
164,209 |
|
— |
|
— |
|
164,209 |
|
||||
Total royalty and stream interests |
|
$ |
2,551,727 |
|
$ |
(442,660 |
) |
$ |
— |
|
$ |
2,109,067 |
|
Impairment of royalty and stream interests
In accordance with our impairment accounting policy discussed in Note 1, impairments in the carrying value of each royalty or stream interest are measured and recorded to the extent that the carrying value in each royalty or stream interest exceeds its estimated fair value, which is generally calculated using estimated future discounted cash-flows. As part of the Company’s regular asset impairment analysis, which included the presence of impairment indicators, the Company recorded impairment charges for the three and six months ended December 31, 2014 and 2013, as summarized in the following table:
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands) |
|
(Amounts in thousands) |
|
||||||||
Wolverine(1) |
|
$ |
25,967 |
|
$ |
— |
|
$ |
25,967 |
|
$ |
— |
|
Other |
|
603 |
|
— |
|
2,372 |
|
— |
|
||||
Total impairment of royalty and stream interests |
|
$ |
26,570 |
|
$ |
— |
|
$ |
28,339 |
|
$ |
— |
|
(1) |
Included in Other production stage royalty interests in the above royalty and stream interests table. |
Wolverine
The Company owns a 0.00% to 9.445% sliding-scale NSR royalty on all gold and silver produced from the Wolverine underground mine and milling operation located in Yukon Territory, Canada, and operated by Yukon Zinc Corporation (“Yukon Zinc”). As part of the Company’s impairment assessment for the three months ended December 31, 2014, the Company was notified of an updated mine plan at Wolverine, which included a significant reduction in reserves and resources when compared to the previous mine plan. A significant reduction in reserves and resources, along with decreases in the long-term metal price assumptions used by the industry, are indicators of impairment.
As part of the impairment determination, the fair value for Wolverine was estimated by calculating the net present value of the estimated future cash-flows expected to be generated by the mining of the Wolverine deposits subject to our royalty interest. The estimates of future cash-flows were derived from a life-of-mine model developed by the Company using Yukon Zinc’s updated mine plan information. The metal price assumptions used in the Company’s model were supported by consensus price estimates obtained from a number of industry analysts. The future cash-flows were discounted using a discount rate which reflects specific market risk factors the Company associates with the Wolverine royalty interest. Following the impairment charge during the three months ended December 31, 2014, the Wolverine royalty interest has a carrying value of $5.3 million.
The Company has a royalty receivable of approximately $3.0 million associated with past due royalty payments on the Wolverine interest. As a result of recent financial and operational results experienced by Yukon Zinc and their decision to put the mine on care and maintenance, the Company believes payment of the receivable is uncertain and has provided for an allowance against the entire receivable as of December 31, 2014. The Company will continue to pursue collection of all past due payments. The expense associated with the allowance is recorded within General and administrative expense on the Company’s consolidated statements of operations and comprehensive income. The Company did not recognize revenue associated with the Wolverine royalty interest during the three months ended December 31, 2014.
Other
As part of the Company’s regular asset impairment analysis during the three months ended September 30, 2014, the Company determined that one production stage royalty interest and one exploration stage royalty interest should be written down to zero for a total impairment of $1.8 million. As part of the termination of the Tulsequah Chief gold and silver stream, as discussed below, the Company wrote-off approximately $0.6 million of direct acquisition costs during the three months ended December 31, 2014.
Termination of the Tulsequah Chief Gold and Silver Stream
On December 22, 2014, RGLD Gold terminated the Amended and Restated Gold and Silver Purchase and Sale Agreement (the “Agreement”), between RGLD Gold, the Company, Chieftain Metals Inc. and Chieftain Metals Corp. (together, “Chieftain”), relating to Chieftain’s Tulsequah Chief polymetallic mining project located in British Columbia, Canada. Pursuant to the terms of the Agreement, Chieftain repaid RGLD Gold’s original $10.0 million advance payment. As a result of the termination of the Agreement, the carrying value ($10.6 million) of the Tulsequah Chief gold and silver stream was reduced to zero during the three months ended December 31, 2014. As of December 31, 2014, the $10 million repayment is recorded within Prepaid expenses and other on the Company’s consolidated balance sheets as the repayment was received in January 2015.
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4.AVAILABLE-FOR-SALE SECURITIES
The Company’s available-for-sale securities as of December 31, 2014 and June 30, 2014 consist of the following:
|
|
As of December 31, 2014 |
|
||||||||||
|
|
|
|
(Amounts in thousands) |
|
|
|
||||||
|
|
|
|
Unrealized |
|
|
|
||||||
|
|
Cost Basis |
|
Gain |
|
Loss |
|
Fair Value |
|
||||
Non-current: |
|
|
|
|
|
|
|
|
|
||||
Seabridge |
|
$ |
9,565 |
|
— |
|
(1,826 |
) |
$ |
7,739 |
|
||
Other |
|
203 |
|
— |
|
(154 |
) |
49 |
|
||||
|
|
$ |
9,768 |
|
$ |
— |
|
$ |
(1,980 |
) |
$ |
7,788 |
|
|
|
As of June 30, 2014 |
|
||||||||||
|
|
|
|
(Amounts in thousands) |
|
|
|
||||||
|
|
|
|
Unrealized |
|
|
|
||||||
|
|
Cost Basis |
|
Gain |
|
Loss |
|
Fair Value |
|
||||
Non-current: |
|
|
|
|
|
|
|
|
|
||||
Seabridge |
|
$ |
9,565 |
|
— |
|
— |
|
$ |
9,565 |
|
||
Other |
|
203 |
|
— |
|
(160 |
) |
43 |
|
||||
|
|
$ |
9,768 |
|
$ |
— |
|
$ |
(160 |
) |
$ |
9,608 |
|
The most significant available-for-sale security is the investment in Seabridge Gold, Inc. (“Seabridge”) common stock, acquired in June 2011 and discussed in greater detail in our Fiscal 2014 10-K. The Company’s policy for determining whether declines in fair value of available-for-sale securities are other than temporary includes a quarterly analysis of the investments and a review by management of all investments for which the cost exceeds the fair value. Any temporary declines in fair value are recorded as a charge to other comprehensive income. If such impairment is determined by the Company to be other than temporary, the investment’s cost basis is written down to fair value and recorded in net income during the period the Company determines such impairment to be other than temporary. Based on the Company’s quarterly analysis of its investments and our ability and intent to hold these investments for a reasonable period of time, there were no write downs on our available-for-sale securities during the three and six months ended December 31, 2014. The Company recognized a loss on available-for-sale securities of $4.5 million during the fourth quarter of our fiscal year ended June 30, 2014. The Company will continue to evaluate its investment in Seabridge common stock considering additional facts and circumstances as they arise, including, but not limited to, the progress of development of Seabridge’s KSM project.
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5.DEBT
The Company’s non-current debt as of December 31, 2014 and June 30, 2014 consists of the following:
|
|
As of |
|
As of |
|
||
|
|
December 31, 2014 |
|
June 30, 2014 |
|
||
|
|
Non-current |
|
Non-current |
|
||
|
|
(Amounts in thousands) |
|
||||
Convertible notes due 2019, net |
|
$ |
316,874 |
|
$ |
311,860 |
|
Total debt |
|
$ |
316,874 |
|
$ |
311,860 |
|
Convertible Senior Notes Due 2019
In June 2012, the Company completed an offering of $370 million aggregate principal amount of 2.875% convertible senior notes due 2019 (“2019 Notes”). The 2019 Notes bear interest at the rate of 2.875% per annum, and the Company is required to make semi-annual interest payments on the outstanding principal balance of the 2019 Notes on June 15 and December 15 of each year, beginning December 15, 2012. The 2019 Notes mature on June 15, 2019. Interest expense recognized on the 2019 Notes for the three and six months ended December 31, 2014, was $5.5 million and $10.9 million, respectively, compared to $5.3 million and $10.6 million for the three and six months ended December 31, 2013, and included the contractual coupon interest, the accretion of the debt discount and amortization of the debt issuance costs.
Revolving credit facility
The Company maintains a $450 million revolving credit facility. As of December 31, 2014, the Company had no amounts outstanding under the revolving credit facility. As discussed in Note 6 to the notes to consolidated financial statements in the Company’s Fiscal 2014 10-K, the Company has financial covenants associated with its revolving credit facility. At December 31, 2014, the Company was in compliance with each financial covenant.
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6.REVENUE
Revenue is comprised of the following:
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands) |
|
(Amounts in thousands) |
|
||||||||
Royalty interests |
|
$ |
43,986 |
|
$ |
50,147 |
|
$ |
93,355 |
|
$ |
106,634 |
|
Stream interests |
|
17,318 |
|
2,638 |
|
36,975 |
|
2,638 |
|
||||
Total revenue |
|
$ |
61,304 |
|
$ |
52,785 |
|
$ |
130,330 |
|
$ |
109,272 |
|
|
7.STOCK-BASED COMPENSATION
The Company recognized stock-based compensation expense as follows:
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands) |
|
(Amounts in thousands) |
|
||||||||
Stock options |
|
$ |
106 |
|
$ |
140 |
|
$ |
219 |
|
$ |
268 |
|
Stock appreciation rights |
|
338 |
|
358 |
|
693 |
|
664 |
|
||||
Restricted stock |
|
157 |
|
781 |
|
1,327 |
|
2,048 |
|
||||
Performance stock |
|
(226 |
) |
(1,132 |
) |
585 |
|
(1,221 |
) |
||||
Total stock-based compensation expense |
|
$ |
375 |
|
$ |
147 |
|
$ |
2,824 |
|
$ |
1,759 |
|
Stock-based compensation expense is included within general and administrative in the consolidated statements of operations and comprehensive income.
There were no stock options granted during the three months ended December 31, 2014 and 2013, and 19,760 and 24,775 stock options granted during the six months ended December 31, 2014 and 2013, respectively. As of December 31, 2014, there was $0.7 million of unrecognized compensation expense related to non-vested stock options, which is expected to be recognized over a weighted-average period of 2.1 years.
There were no stock-settled stock appreciation rights (“SSARs”) granted during the three months ended December 31, 2014 and 2013, and 87,890 and 84,125 SSARs granted during the six months ended December 31, 2014 and 2013, respectively. As of December 31, 2014, there was $2.5 million of unrecognized compensation expense related to non-vested SSARs, which is expected to be recognized over a weighted-average period of 2.2 years.
There were no shares of restricted stock granted during the three months ended December 31, 2014 and 2013, and 55,589 and 66,150 shares of restricted stock granted during the six months ended December 31, 2014 and 2013, respectively. As of December 31, 2014, there was $6.4 million of unrecognized compensation expense related to non-vested restricted stock, which is expected to be recognized over a weighted-average vesting period of 3.4 years.
There were no shares of performance stock granted during the three months ended December 31, 2014 and 2013, and 46,800 and 71,700 shares of performance stock granted during the six months ended December 31, 2014 and 2013, respectively. As of December 31, 2014, there was $3.0 million of unrecognized compensation expense related to non-vested performance stock, which is expected to be recognized over a weighted-average vesting period of 2.6 years.
|
8.EARNINGS PER SHARE (“EPS”)
Basic earnings (loss) per common share were computed using the weighted average number of shares of common stock outstanding during the period, considering the effect of participating securities. Unvested stock-based compensation awards that contain non-forfeitable rights to dividends or dividend equivalents are considered participating securities and are included in the computation of earnings per share pursuant to the two-class method. The Company’s unvested restricted stock awards contain non-forfeitable dividend rights and participate equally with common stock with respect to dividends issued or declared. The Company’s unexercised stock options, unexercised SSARs and unvested performance stock do not contain rights to dividends. Under the two-class method, the earnings (loss) used to determine basic earnings (loss) per common share are reduced by an amount allocated to participating securities. Use of the two-class method has an immaterial impact on the calculation of basic and diluted earnings (loss) per common share.
The following tables summarize the effects of dilutive securities on diluted EPS for the period:
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(in thousands, except per share data) |
|
(in thousands, except per share data) |
|
||||||||
Net (loss) income available to Royal Gold common stockholders |
|
$ |
(6,548 |
) |
$ |
10,667 |
|
$ |
12,134 |
|
$ |
25,862 |
|
Weighted-average shares for basic EPS |
|
65,002,307 |
|
64,897,757 |
|
64,982,595 |
|
64,878,056 |
|
||||
Effect of other dilutive securities |
|
— |
|
93,014 |
|
139,590 |
|
104,633 |
|
||||
Weighted-average shares for diluted EPS |
|
65,002,307 |
|
64,990,771 |
|
65,122,185 |
|
64,982,689 |
|
||||
Basic (loss) earnings per share |
|
$ |
(0.10 |
) |
$ |
0.16 |
|
$ |
0.19 |
|
$ |
0.40 |
|
Diluted (loss) earnings per share |
|
$ |
(0.10 |
) |
$ |
0.16 |
|
$ |
0.19 |
|
$ |
0.40 |
|
The calculation of weighted average shares includes all of our outstanding stock: common stock and exchangeable shares. Exchangeable shares are the equivalent of common shares in that they have the same dividend rights and share equitably in undistributed earnings and are exchangeable on a one-for-one basis for shares of our common stock. The Company intends to settle the principal amount of the 2019 Notes in cash. As a result, there will be no impact to diluted earnings per share unless the share price of the Company’s common stock exceeds the conversion price of $105.31.
|
9.INCOME TAXES
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands, except rate) |
|
(Amounts in thousands, except rate) |
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||
Income tax benefit (expense) |
|
$ |
1,827 |
|
$ |
(6,311 |
) |
$ |
(2,131 |
) |
$ |
(11,152 |
) |
Effective tax rate |
|
22.4 |
% |
36.9 |
% |
14.5 |
% |
30.0 |
% |
The decrease in the effective tax rate for the three and six months ended December 31, 2014, is primarily related to (i) the impairment charge on the Wolverine royalty interest and the corresponding tax benefit, (ii) a favorable tax rate associated with certain operations in lower-tax jurisdictions, (iii) a decrease in tax expense related to earnings from non-U.S. subsidiaries, and (iv) a valuation allowance release as a result of the strengthening U.S. dollar. The decrease in the effective tax rate for the six months ended December 31, 2014, is also attributable to a decrease in tax expense due to the Chilean tax legislation enacted in the quarter ended September 30, 2014 and the re-measurement of the Chilean long term deferred tax asset to the higher corporate income tax rate. The decrease in tax expense was partially offset by an increase in current year tax expense due to accrual for uncertain tax positions.
The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various state and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. Federal, state and local, and non-U.S. income tax examinations by tax authorities for fiscal years before 2009. As a result of (i) statutes of limitation that will begin to expire within the next 12 months in various jurisdictions, (ii) possible settlements of audit-related issues with taxing authorities in various jurisdictions with respect to which none of the issues are individually significant, and (iii) additional accrual of exposure and interest on existing items, the Company believes that it is reasonably possible that the total amount of its net unrecognized income tax benefits will not decrease in the next 12 months.
As of December 31, 2014 and June 30, 2014, the Company had $14.8 million and $13.7 million of total gross unrecognized tax benefits, respectively. If recognized, these unrecognized tax benefits would positively impact the Company’s effective income tax rate.
The Company’s continuing practice is to recognize potential interest and/or penalties related to unrecognized tax benefits as part of its income tax expense. At December 31, 2014 and June 30, 2014, the amount of accrued income-tax-related interest and penalties was $6.4 million and $5.4 million, respectively.
|
10.SEGMENT INFORMATION
The Company manages its business under a single operating segment, consisting of the acquisition and management of royalty and stream interests. Royal Gold’s revenue and long-lived assets (royalty and stream interests, net) are geographically distributed as shown in the following table.
|
|
Revenue |
|
|
|
|
|
||||||
|
|
Three Months Ended |
|
Six Months Ended |
|
Royalty and Stream Interests, net |
|
||||||
|
|
December 31, |
|
December 31, |
|
As of |
|
As of |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
December 31, 2014 |
|
June 30, 2014 |
|
Canada |
|
45 |
% |
28 |
% |
45 |
% |
27 |
% |
53 |
% |
53 |
% |
United States |
|
17 |
% |
17 |
% |
17 |
% |
15 |
% |
3 |
% |
3 |
% |
Chile |
|
16 |
% |
23 |
% |
16 |
% |
27 |
% |
32 |
% |
31 |
% |
Mexico |
|
14 |
% |
20 |
% |
14 |
% |
19 |
% |
7 |
% |
7 |
% |
Australia |
|
3 |
% |
4 |
% |
3 |
% |
4 |
% |
3 |
% |
3 |
% |
Africa |
|
1 |
% |
3 |
% |
1 |
% |
3 |
% |
1 |
% |
1 |
% |
Other |
|
4 |
% |
5 |
% |
4 |
% |
5 |
% |
1 |
% |
2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11.FAIR VALUE MEASUREMENTS
FASB Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures (“ASC 820”) establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:
Level 1:Quoted prices for identical instruments in active markets;
Level 2:Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
Level 3:Prices or valuation techniques requiring inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).
The following table sets forth the Company’s financial assets measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy.
|
|
At December 31, 2014 |
|
|||||||||||||
|
|
Carrying |
|
Fair Value |
|
|||||||||||
|
|
Amount |
|
Total |
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
|||||
Assets (In thousands): |
|
|
|
|
|
|
|
|
|
|
|
|||||
United States treasury bills(1) |
|
$ |
524,983 |
|
$ |
524,983 |
|
$ |
524,983 |
|
$ |
— |
|
$ |
— |
|
Marketable equity securities(2) |
|
$ |
7,788 |
|
$ |
7,788 |
|
$ |
7,788 |
|
$ |
— |
|
$ |
— |
|
Total assets |
|
|
|
$ |
532,771 |
|
$ |
532,771 |
|
$ |
— |
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Liabilities (In thousands): |
|
|
|
|
|
|
|
|
|
|
|
|||||
Debt(3) |
|
$ |
393,874 |
|
$ |
382,957 |
|
$ |
382,957 |
|
$ |
— |
|
$ |
— |
|
Total liabilities |
|
|
|
$ |
382,957 |
|
$ |
382,957 |
|
$ |
— |
|
$ |
— |
|
(1) |
Included in Cash and equivalents in the Company’s consolidated balance sheets. |
(2) |
Included in Available for sale securities in the Company’s consolidated balance sheets. |
(3) |
Included in the carrying amount is the equity component of our 2019 Notes in the amount of $77 million, which is included within Additional paid-in capital in the Company’s consolidated balance sheets. |
The Company invests primarily in United States treasury bills with maturities of 90 days or less, which are classified within Level 1 of the fair value hierarchy. The Company also invests in money market funds, which are traded by dealers or brokers in active over-the-counter markets. The Company’s money market funds, which are invested in United States treasury bills or United States treasury backed securities, are also classified within Level 1 of the fair value hierarchy. The Company’s marketable equity securities classified within Level 1 of the fair value hierarchy are valued using quoted market prices in active markets. The fair value of the Level 1 marketable equity securities is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company. The Company’s debt classified within Level 1 of the fair value hierarchy is valued using quoted prices in an active market.
As of December 31, 2014, the Company also had assets that, under certain conditions, are subject to measurement at fair value on a non-recurring basis like those associated with royalty and stream interests, intangible assets and other long-lived assets. For these assets, measurement at fair value in periods subsequent to their initial recognition is applicable if any of these assets are determined to be impaired. If recognition of these assets at their fair value becomes necessary, such measurements will be determined utilizing Level 3 inputs. Refer to Note 3 for discussion of inputs used to develop fair value for those royalty interests that were determined to be impaired during the period ended December 31, 2014.
|
12.COMMITMENTS AND CONTINGENCIES
Ilovitza Gold Stream Acquisition
As of December 31, 2014, the Company has a remaining commitment, subject to certain conditions, of $175.0 million as part of its Ilovitza gold stream acquisition in October 2014 (Note 2).
Phoenix Gold Project Stream Acquisition
As of December 31, 2014, the Company has a remaining commitment of approximately $12.8 million as part of its Phoenix Gold Project stream acquisition in February 2014.
Voisey’s Bay
The Company indirectly owns a royalty on the Voisey’s Bay mine in Newfoundland and Labrador owned by Vale Newfoundland & Labrador Limited (“VNL”). The royalty is directly owned by the Labrador Nickel Royalty Limited Partnership (“LNRLP”), in which the Company’s wholly-owned indirect subsidiary, Canadian Minerals Partnership, is the general partner and 89.99% owner. The remaining interests in LNRLP are owned by Altius Investments Ltd. (10%), a company unrelated to Royal Gold, and the Company’s wholly-owned indirect subsidiary, Voisey’s Bay Holding Corporation (0.01%).
On December 5, 2014, LNRLP filed amendments to its October 16, 2009 Statement of Claim in the Supreme Court of Newfoundland and Labrador Trial Division against Vale Inco Limited, now known as Vale Canada Limited (“Vale Canada”) and its wholly-owned subsidiaries, Vale Inco Atlantic Sales Limited and VNL, related to calculation of the NSR on the sale of concentrates, including nickel concentrates, from the Voisey’s Bay mine. LNRLP asserts that the defendants have incorrectly calculated the NSR since production at Voisey’s Bay began in late 2005, have indicated an intention to calculate the NSR in a manner LNRLP believes will violate the royalty agreement when Voisey’s Bay concentrates are processed at Vale’s new Long Harbour processing facility, and have breached their contractual duties of good faith and honest performance in several ways. LNRLP requests an order in respect of the correct calculation of future payments, and damages for non-payment and underpayment of past royalties to the date of the claim, together with additional damages until the date of trial, interest, costs and other damages. The litigation is in the discovery phase.
|
13.SUBSEQUENT EVENT
Peak Gold Joint Venture
On January 8, 2015, Royal Gold, through its wholly-owned subsidiary, Royal Alaska, LLC (“Royal Alaska”), and Contango ORE, Inc., through its wholly-owned subsidiary CORE Alaska, LLC (together, “Contango”), entered into a limited liability company agreement for Peak Gold, a joint venture for development of the Tetlin gold project located near Tok, Alaska (the “Project”). Contango contributed all of its assets relating to the Project to Peak Gold, including a mining lease and certain state of Alaska mining claims. Royal Alaska contributed $5.0 million in cash to Peak Gold. Contango will control 100% of the membership interest in Peak Gold initially. Royal Alaska has the right to obtain up to 40% of the membership interest in Peak Gold by making contributions of up to $30.0 million (including Royal Alaska’s initial $5.0 million contribution) in cash to Peak Gold by October 31, 2018. Royal Alaska will act as the manager of Peak Gold unless and until it is removed or resigns that position in the manner provided in the limited liability company agreement.
|
Asset Impairment
We evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts of an asset or group of assets may not be recoverable. The recoverability of the carrying value of royalty and stream interests in production and development stage mineral properties is evaluated based upon estimated future undiscounted net cash flows from each royalty and stream interest property using estimates of proven and probable reserves and other relevant information received from the operators. We evaluate the recoverability of the carrying value of royalty interests in exploration stage mineral properties in the event of significant decreases in the price of gold, silver, copper, nickel and other metals, and whenever new information regarding the mineral properties is obtained from the operator indicating that production will not likely occur or may be reduced in the future, thus affecting the future recoverability of our royalty interests. Impairments in the carrying value of each property are measured and recorded to the extent that the carrying value in each property exceeds its estimated fair value, which is generally calculated using estimated future discounted cash flows.
Our estimates of gold, silver, copper, nickel and other metal prices, operators’ estimates of proven and probable reserves related to our royalty or streaming properties, and operators’ estimates of operating, capital and reclamation costs are subject to certain risks and uncertainties which may affect the recoverability of our investment in these royalty and stream interests in mineral properties. Although we have made our best assessment of these factors based on current market conditions, it is possible that changes could occur, which could adversely affect the net cash flows expected to be generated from these royalty and stream interests. Refer to Note 3 for discussion and the results of our quarterly impairment assessments for the three and six months ended December 31, 2014.
|
As of December 31, 2014 (Amounts in thousands): |
|
Cost |
|
Accumulated |
|
Impairments |
|
Net |
|
||||
Production stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Andacollo |
|
$ |
272,998 |
|
$ |
(60,892 |
) |
$ |
— |
|
$ |
212,106 |
|
Voisey’s Bay |
|
150,138 |
|
(73,262 |
) |
— |
|
76,876 |
|
||||
Peñasquito |
|
99,172 |
|
(20,716 |
) |
— |
|
78,456 |
|
||||
Mulatos |
|
48,092 |
|
(30,226 |
) |
— |
|
17,866 |
|
||||
Holt |
|
34,612 |
|
(12,184 |
) |
— |
|
22,428 |
|
||||
Robinson |
|
17,825 |
|
(12,291 |
) |
— |
|
5,534 |
|
||||
Cortez |
|
10,630 |
|
(9,844 |
) |
— |
|
786 |
|
||||
Other |
|
491,689 |
|
(246,936 |
) |
(27,586 |
) |
217,167 |
|
||||
Total production stage royalty interests |
|
1,125,156 |
|
(466,351 |
) |
(27,586 |
) |
631,219 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Production stage stream interests: |
|
|
|
|
|
|
|
|
|
||||
Mount Milligan |
|
783,046 |
|
(18,740 |
) |
— |
|
764,306 |
|
||||
Total production stage royalty and stream interests |
|
1,908,202 |
|
(485,091 |
) |
(27,586 |
) |
1,395,525 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Development stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Pascua-Lama |
|
372,105 |
|
— |
|
— |
|
372,105 |
|
||||
Other |
|
71,092 |
|
— |
|
— |
|
71,092 |
|
||||
Total development stage royalty interests |
|
443,197 |
|
— |
|
— |
|
443,197 |
|
||||
Total development stage stream interests |
|
63,331 |
|
— |
|
(603 |
) |
62,728 |
|
||||
Total development stage royalty and stream interests |
|
506,528 |
|
— |
|
(603 |
) |
505,925 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Exploration stage royalty interests |
|
165,852 |
|
— |
|
(150 |
) |
165,702 |
|
||||
Total royalty and stream interests |
|
$ |
2,580,582 |
|
$ |
(485,091 |
) |
$ |
(28,339 |
) |
$ |
2,067,152 |
|
As of June 30, 2014 (Amounts in thousands): |
|
Cost |
|
Accumulated |
|
Impairments |
|
Net |
|
||||
Production stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Andacollo |
|
$ |
272,998 |
|
$ |
(56,147 |
) |
$ |
— |
|
$ |
216,851 |
|
Voisey’s Bay |
|
150,138 |
|
(67,377 |
) |
— |
|
82,761 |
|
||||
Peñasquito |
|
99,172 |
|
(17,801 |
) |
— |
|
81,371 |
|
||||
Mulatos |
|
48,092 |
|
(28,548 |
) |
|
|
19,544 |
|
||||
Holt |
|
34,612 |
|
(10,474 |
) |
— |
|
24,138 |
|
||||
Robinson |
|
17,825 |
|
(11,887 |
) |
|
|
5,938 |
|
||||
Cortez |
|
10,630 |
|
(9,772 |
) |
— |
|
858 |
|
||||
Other |
|
488,309 |
|
(232,913 |
) |
— |
|
255,396 |
|
||||
Total production stage royalty interests |
|
1,121,776 |
|
(434,919 |
) |
— |
|
686,857 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Production stage stream interests: |
|
|
|
|
|
|
|
|
|
||||
Mount Milligan |
|
783,046 |
|
(7,741 |
) |
— |
|
775,305 |
|
||||
Total production stage royalty and stream interests |
|
1,904,822 |
|
(442,660 |
) |
— |
|
1,462,162 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Development stage royalty interests: |
|
|
|
|
|
|
|
|
|
||||
Pascua-Lama |
|
372,105 |
|
— |
|
— |
|
372,105 |
|
||||
Other |
|
69,488 |
|
— |
|
— |
|
69,488 |
|
||||
Total development stage royalty interests |
|
441,593 |
|
— |
|
— |
|
441,593 |
|
||||
Total development stage stream interests |
|
41,103 |
|
— |
|
— |
|
41,103 |
|
||||
Total development stage royalty and stream interests |
|
482,696 |
|
— |
|
— |
|
482,696 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Exploration stage royalty interests |
|
164,209 |
|
— |
|
— |
|
164,209 |
|
||||
Total royalty and stream interests |
|
$ |
2,551,727 |
|
$ |
(442,660 |
) |
$ |
— |
|
$ |
2,109,067 |
|
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands) |
|
(Amounts in thousands) |
|
||||||||
Wolverine(1) |
|
$ |
25,967 |
|
$ |
— |
|
$ |
25,967 |
|
$ |
— |
|
Other |
|
603 |
|
— |
|
2,372 |
|
— |
|
||||
Total impairment of royalty and stream interests |
|
$ |
26,570 |
|
$ |
— |
|
$ |
28,339 |
|
$ |
— |
|
(1) |
Included in Other production stage royalty interests in the above royalty and stream interests table. |
|
|
|
As of December 31, 2014 |
|
||||||||||
|
|
|
|
(Amounts in thousands) |
|
|
|
||||||
|
|
|
|
Unrealized |
|
|
|
||||||
|
|
Cost Basis |
|
Gain |
|
Loss |
|
Fair Value |
|
||||
Non-current: |
|
|
|
|
|
|
|
|
|
||||
Seabridge |
|
$ |
9,565 |
|
— |
|
(1,826 |
) |
$ |
7,739 |
|
||
Other |
|
203 |
|
— |
|
(154 |
) |
49 |
|
||||
|
|
$ |
9,768 |
|
$ |
— |
|
$ |
(1,980 |
) |
$ |
7,788 |
|
|
|
As of June 30, 2014 |
|
||||||||||
|
|
|
|
(Amounts in thousands) |
|
|
|
||||||
|
|
|
|
Unrealized |
|
|
|
||||||
|
|
Cost Basis |
|
Gain |
|
Loss |
|
Fair Value |
|
||||
Non-current: |
|
|
|
|
|
|
|
|
|
||||
Seabridge |
|
$ |
9,565 |
|
— |
|
— |
|
$ |
9,565 |
|
||
Other |
|
203 |
|
— |
|
(160 |
) |
43 |
|
||||
|
|
$ |
9,768 |
|
$ |
— |
|
$ |
(160 |
) |
$ |
9,608 |
|
|
|
|
As of |
|
As of |
|
||
|
|
December 31, 2014 |
|
June 30, 2014 |
|
||
|
|
Non-current |
|
Non-current |
|
||
|
|
(Amounts in thousands) |
|
||||
Convertible notes due 2019, net |
|
$ |
316,874 |
|
$ |
311,860 |
|
Total debt |
|
$ |
316,874 |
|
$ |
311,860 |
|
|
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands) |
|
(Amounts in thousands) |
|
||||||||
Royalty interests |
|
$ |
43,986 |
|
$ |
50,147 |
|
$ |
93,355 |
|
$ |
106,634 |
|
Stream interests |
|
17,318 |
|
2,638 |
|
36,975 |
|
2,638 |
|
||||
Total revenue |
|
$ |
61,304 |
|
$ |
52,785 |
|
$ |
130,330 |
|
$ |
109,272 |
|
|
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands) |
|
(Amounts in thousands) |
|
||||||||
Stock options |
|
$ |
106 |
|
$ |
140 |
|
$ |
219 |
|
$ |
268 |
|
Stock appreciation rights |
|
338 |
|
358 |
|
693 |
|
664 |
|
||||
Restricted stock |
|
157 |
|
781 |
|
1,327 |
|
2,048 |
|
||||
Performance stock |
|
(226 |
) |
(1,132 |
) |
585 |
|
(1,221 |
) |
||||
Total stock-based compensation expense |
|
$ |
375 |
|
$ |
147 |
|
$ |
2,824 |
|
$ |
1,759 |
|
|
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(in thousands, except per share data) |
|
(in thousands, except per share data) |
|
||||||||
Net (loss) income available to Royal Gold common stockholders |
|
$ |
(6,548 |
) |
$ |
10,667 |
|
$ |
12,134 |
|
$ |
25,862 |
|
Weighted-average shares for basic EPS |
|
65,002,307 |
|
64,897,757 |
|
64,982,595 |
|
64,878,056 |
|
||||
Effect of other dilutive securities |
|
— |
|
93,014 |
|
139,590 |
|
104,633 |
|
||||
Weighted-average shares for diluted EPS |
|
65,002,307 |
|
64,990,771 |
|
65,122,185 |
|
64,982,689 |
|
||||
Basic (loss) earnings per share |
|
$ |
(0.10 |
) |
$ |
0.16 |
|
$ |
0.19 |
|
$ |
0.40 |
|
Diluted (loss) earnings per share |
|
$ |
(0.10 |
) |
$ |
0.16 |
|
$ |
0.19 |
|
$ |
0.40 |
|
|
|
|
For The Three Months Ended |
|
For The Six Months Ended |
|
||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
||||
|
|
(Amounts in thousands, except rate) |
|
(Amounts in thousands, except rate) |
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||
Income tax benefit (expense) |
|
$ |
1,827 |
|
$ |
(6,311 |
) |
$ |
(2,131 |
) |
$ |
(11,152 |
) |
Effective tax rate |
|
22.4 |
% |
36.9 |
% |
14.5 |
% |
30.0 |
% |
|
|
|
Revenue |
|
|
|
|
|
||||||
|
|
Three Months Ended |
|
Six Months Ended |
|
Royalty and Stream Interests, net |
|
||||||
|
|
December 31, |
|
December 31, |
|
As of |
|
As of |
|
||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
|
December 31, 2014 |
|
June 30, 2014 |
|
Canada |
|
45 |
% |
28 |
% |
45 |
% |
27 |
% |
53 |
% |
53 |
% |
United States |
|
17 |
% |
17 |
% |
17 |
% |
15 |
% |
3 |
% |
3 |
% |
Chile |
|
16 |
% |
23 |
% |
16 |
% |
27 |
% |
32 |
% |
31 |
% |
Mexico |
|
14 |
% |
20 |
% |
14 |
% |
19 |
% |
7 |
% |
7 |
% |
Australia |
|
3 |
% |
4 |
% |
3 |
% |
4 |
% |
3 |
% |
3 |
% |
Africa |
|
1 |
% |
3 |
% |
1 |
% |
3 |
% |
1 |
% |
1 |
% |
Other |
|
4 |
% |
5 |
% |
4 |
% |
5 |
% |
1 |
% |
2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2014 |
|
|||||||||||||
|
|
Carrying |
|
Fair Value |
|
|||||||||||
|
|
Amount |
|
Total |
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
|||||
Assets (In thousands): |
|
|
|
|
|
|
|
|
|
|
|
|||||
United States treasury bills(1) |
|
$ |
524,983 |
|
$ |
524,983 |
|
$ |
524,983 |
|
$ |
— |
|
$ |
— |
|
Marketable equity securities(2) |
|
$ |
7,788 |
|
$ |
7,788 |
|
$ |
7,788 |
|
$ |
— |
|
$ |
— |
|
Total assets |
|
|
|
$ |
532,771 |
|
$ |
532,771 |
|
$ |
— |
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Liabilities (In thousands): |
|
|
|
|
|
|
|
|
|
|
|
|||||
Debt(3) |
|
$ |
393,874 |
|
$ |
382,957 |
|
$ |
382,957 |
|
$ |
— |
|
$ |
— |
|
Total liabilities |
|
|
|
$ |
382,957 |
|
$ |
382,957 |
|
$ |
— |
|
$ |
— |
|
(1) |
Included in Cash and equivalents in the Company’s consolidated balance sheets. |
(2) |
Included in Available for sale securities in the Company’s consolidated balance sheets. |
(3) |
Included in the carrying amount is the equity component of our 2019 Notes in the amount of $77 million, which is included within Additional paid-in capital in the Company’s consolidated balance sheets. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|