T S X : S S L N Y S E . M K T : S A N D E S T D 2 0 0 8 A U G U S T 2 0 1 4
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION Except for the statements of historical fact contained herein, the information presented constitutes "forward-looking statements", within the meaning of the U.S. Securities Act of 1933, the U.S. Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of Sandstorm Gold Ltd. (“Sandstorm”). Forward- looking statements include, but are not limited to, statements with respect to the future price of gold, the estimation of mineral reserves and resources, realization of mineral reserve estimates, the timing and amount of estimated future production. Forward-looking statements can generally be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “continue”, “plans”, or similar termi- nology. Forward-looking statements are made based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performances or achievements of Sandstorm to be materially different from future results, performances or achievements expressed or implied by such statements. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environ- ment in which Sandstorm will operate in the future, including the price of gold and anticipated costs. Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements include, amongst others, gold price volatility, discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and develop- ment risks relating to the parties which produce the gold Sandstorm will purchase, regulatory restrictions, activities by governmental authorities (including changes in taxation), currency fluctuations, the global economic climate, dilution, share price volatility and competition. Forward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause the actual results, level of activity, performance or achievements of Sandstorm to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: the impact of general business and economic conditions, the absence of control over mining operations from which Sand- storm will purchase gold and risks related to those mining operations, including risks related to international operations, government and environmental regulation, actual results of current exploration activities, conclusions of economic evaluations and changes in project parameters as plans continue to be refined, risks in the marketability of minerals, fluctuations in the price of gold, fluctuation in foreign exchange rates and interest rates, stock market volatility, as well as those factors discussed in the section entitled “Risks to Sandstorm” in Sandstorm’s annual report for the financial year ended December 31, 2012 available at www.sedar.com. Although Sandstorm has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Sandstorm does not undertake to update any forward looking statements that are contained or incorporated by reference, except in accordance with applicable securities laws. 2
THREE REASONS TO OWN SANDSTORM 1 2 3 Gold Streaming Strong Future Advantage Foundation Growth Strong returns, Portfolio of 38 streams Over $165 million in lower risk and royalties with available capital for 14 cash flowing assets acquisitions 3
STRONG SECTION ONE RETURNS, LOWER RISK 4
HOW A GOLD STREAM WORKS Sandstorm provides an upfront cash payment to a mining partner. Upfront Mining Payment Partner Sandstorm receives the right to purchase a percentage of the mine’s production at a fixed price per ounce. Mining % of Gold Partner Production Sandstorm sells the gold at spot price and receives a “stream” of cash flow. 5
ADVANTAGES OF STREAMING Exploration Upside with no exploration costs Gold Price Upside with fixed cash costs forever Diversification without ongoing management of assets 6
RELATIVE SHARE PRICE PERFORMANCE ‘09 2010 2011 2012 2013 2014 700% Sandstorm Gold 600% Streaming Companies (Silver Wheaton, Royal Gold, Franco-Nevada) Sandstorm Partners 500% Global Gold Index Fund 400% 300% 200% 100% 0% –100% 7
Strong SECTION TWO Foundation 8
10 14 40,000–50,000 Cash Flowing Streams Assets AuEq Ounces in 2014 28 60,000 Royalties AuEq Ounces per year by 2017 9
64% 34% 2% Cash Flow Cash Flow Cash Flow North America South America South Africa 10
SANDSTORM MANAGEMENT TEAM —NOLAN WATSON —DAVID AWRAM CA, CFA B.Sc, Geologist Co-founder, President & CEO Co-founder & Senior EVP First Two Employees Of Silver Wheaton Involved in Closing Over $2 Billion in Streaming Transactions — ERFAN — RON — JUSTIN — ADAM KAZEMI HO COCHRANE SPENCER CA, CFA CA, CFA CFA CFA Chief Financial Officer Vice President, Finance Executive VP, Corp Dev Vice President, Corp Dev 11
SANDSTORM TECHNICAL TEAM —TOM BRUINGTON —ROBERT BLAIR P. Eng., M.Sc. Sr. Fellow SEG, GSA EVP, Project Evaluation Consulting Economic Geologist Tom was the former Chief Engineer at IFC (World Bank Group) and has completed over 100 project evaluations in over 60 countries Robert has 50+ years of experience with exploration/production in major and junior hard rock mining co.’s 12
NEW GOLD STREAM TRUE GOLD MINING LOCATION KARMA GOLD STREAM Burkina Faso, West Africa TERMS $25 million upfront 5,000 ozs/year for 5 years , 1.6% life of mine gold stream thereafter THE MINING SECTOR’S FIRST SYNDICATED ONGOING PAYMENTS 20% of the spot price of gold GOLD STREAM $100 million deal: Sandstorm Gold 25%, Franco Nevada 75% 13
KEY GOLD STREAMS PRODUCING AURIZONA GOLD STREAM SANTA ELENA GOLD STREAM BLACK FOX GOLD STREAM PAID CASH FLOW TO DATE PAID CASH FLOW TO DATE PAID CASH FLOW TO DATE $27.8M $44.4M $22M $24.2M $56.3M $50.5M +20y MINE LIFE REMAINING +10y MINE LIFE REMAINING +8y MINE LIFE REMAINING ALL ASSETS BEING DRILLED TO EXTEND MINE LIFE 14
OTHER GOLD STREAMS PRODUCING BACHELOR LAKE MING LOCATION LOCATION QUEBEC, CANADA NEWFOUNDLAND, CANADA TERMS TERMS 20% @ $500/OZ 25%–32% @ $0/OZ ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW $ 8,000,000 $ 2,500,000 KEY GOLD ROYALTIES PRODUCING BRACEMAC-MCLEOD GUALCAMAYO EMIGRANT SPRINGS MINE WASTE SOLUTIONS LOCATION LOCATION LOCATION LOCATION QUEBEC, CANADA SAN JUAN, ARGENTINA NEVADA, USA VAAL RIVER, SOUTH AFRICA TERMS TERMS TERMS TERMS 3.0% NSR 1.0% NSR 1.5% NSR 1.0% NSR ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW ESTIMATED ANNUAL CASH FLOW $ 5,000,000 $ 2,000,000 $ 1,600,000 $ 1,000,000 15
OTHER STREAMS & ROYALTIES 16
ESTIMATED CASH FLOW US$ 1,300/oz Au ‘14 ‘15 ‘16 ‘17 ‘18 $80M $58M 2017 $60M ‹ Royalties ‹ Other $40M ‹ Karma ‹ Bachelor Lake ‹ Black Fox $20M ‹ Santa Elena ‹ Aurizona 0 17
FUTURE SECTION THREE GROWTH 18
AVAILABLE CAPITAL Credit Facility Accumulated $ 4 0 0 M Cash Balance $275M 2016 $230M 2015 $ 3 0 0 M $180M 2014 Warrants Exercised $ 2 0 0 M $ 1 0 0 M 0 OCT MAR MAY OCT MAR MAY OCT AUG NOV DEC APR AUG NOV DEC APR AUG NOV DEC SEP FEB SEP FEB SEP JAN JUN JUL JAN JUN JUL 19
WHAT WE LOOK FOR IN A PROJECT Robust Low Cost Exploration Economics Producer Upside WHAT WE LOOK FOR IN A COMPANY Conservative Ability to Experienced Capital Structure Raise Capital Technical Team 20
EV/CASH FLOW COMPARISON Based on 2016 estimates. Comparators using CapitalIQ estimates on August 11, 2014. 22.2 Sandstorm figures based on Company estimates Franco Nevada for EV and Cash Flow. 18.1 Royal Gold’s 2016 cash flow estimates are based Royal Gold on year end June 30. 15.6 Silver Wheaton 11.7 Sandstorm 21
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