Osisko Gold Royalties : Consolidated Financial Statements – Q1 2024

Unaudited Condensed Interim

Consolidated Financial Statements

For the three months

ended

March 31, 2024

Osisko Gold Royalties Ltd

Consolidated Balance Sheets (Unaudited)

(tabular amounts expressed in thousands of Canadian dollars)

		March 31,		December 31,
		2024		2023
	Notes	$	$
Assets
Current assets
Cash	3	70,601	67,721
Short-term investments	4	9,304	8,200
Amounts receivable		4,213	6,282
Other assets		1,485	1,842
		85,603	84,045
Non-current assets
Investments in associates	5	99,385	115,651
Other investments	6	94,077	93,025
Royalty, stream and other interests	7	1,557,771	1,553,111
Goodwill		111,204	111,204
Other assets		8,615	8,951
		1,956,655	1,965,987
Liabilities
Current liabilities
Accounts payable and accrued liabilities		4,973	8,209
Dividends payable		11,154	11,121
Lease liabilities		1,150		1,122
		17,277	20,452
Non-current liabilities
Lease liabilities		6,576	6,879
Long-term debt	8	151,944	191,879
Deferred income taxes		103,917		96,279
		279,714	315,489
Equity
Share capital	9	2,106,596	2,097,691
Contributed surplus		76,580	79,446
Accumulated other comprehensive income		45,631	28,058
Deficit		(551,866)	(554,697)
		1,676,941		1,650,498
		1,956,655		1,965,987

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

2

Osisko Gold Royalties Ltd

Consolidated Statements of Income

For the three months ended March 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)

		2024		2023
	Notes	$	$
Revenues	11	60,751	59,587
Cost of sales	11	(1,833)	(4,041)
Depletion	11	(11,524)		(13,495)
Gross profit		47,394	42,051
Other operating expenses
General and administrative		(6,130)	(6,209)
Business development		(1,360)		(1,496)
Operating income		39,904	34,346
Interest income		1,259	2,063
Finance costs		(3,731)	(2,870)
Foreign exchange (loss) gain		(3,250)	19
Share of loss of associates		(13,558)	(6,145)
Other gains, net	11	2,351		1,826
Earnings before income taxes		22,975	29,239
Income tax expense		(7,902)		(8,391)
Net earnings		15,073	20,848
Net earnings per share
Basic and diluted	12	0.08	0.11

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

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Osisko Gold Royalties Ltd

Consolidated Statements of Comprehensive Income

For the three months ended March 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars)

	2024		2023
	$	$
Net earnings	15,073	20,848
Other comprehensive income (loss)
Items that will not be reclassified to the consolidated statement of income
Changes in fair value of financial assets at fair value through other
comprehensive income	2,263	(1,438)
Income tax effect	(316)	2
Share of other comprehensive loss of associates	(285)	-
Items that may be reclassified to the consolidated statement of income
Currency translation adjustments	18,285	(447)
Share of other comprehensive loss of associates	(2,423)		-
Other comprehensive income (loss)	17,524		(1,883)
Comprehensive income	32,597		18,965

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

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Osisko Gold Royalties Ltd

Consolidated Statements of Cash Flows

For the three months ended March 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars)
		2024		2023
	Notes	$	$
Operating activities
Net earnings		15,073	20,848
Adjustments for:
Share-based compensation		2,113	2,289
Depletion and amortization		11,853	13,754
Impairment of investments in associates		-	271
Changes in expected credit loss of other investments		(1,895)	-
Share of loss of associates		13,558	6,145
Change in fair value of financial assets at fair value through profit and loss		(456)	2,745
Net gain on dilution of investments		-	(4,842)
Foreign exchange loss		3,287	16
Deferred income tax expense		7,368	7,460
Other		157	36
Net cash flows provided by operating activities
before changes in non-cash working capital items		51,058	48,722
Changes in non-cash working capital items	13	(681)		(3,272)
Net cash flows provided by operating activities		50,377	45,450
Investing activities
Acquisitions of short-term investments		(900)	(1,643)
Acquisitions of investments		-	(271)
Proceeds on disposal and repayment of investments		5,177	-
Other		(4)		-
Net cash flows provided by (used in) investing activities		4,273	(1,914)
Financing activities
Repayment of long-term debt, net of discount on banker's acceptances		(43,617)	(13,463)
Proceeds from the exercise of share options and shares issued under the share		4,867	8,900
purchase plan
Dividends paid		(10,357)	(9,753)
Withholding taxes on settlement of restricted and deferred share units		(2,987)	(456)
Other		(388)		(212)
Net cash flows used in financing activities		(52,482)		(14,984)
Increase in cash before effects of exchange rate changes		2,168	28,552
Effects of exchange rate changes on cash		712	(16)
Net increase in cash		2,880	28,536
Cash - beginning of period		67,721		90,548
Cash - end of period	3	70,601		119,084

Additional information on the consolidated statements of cash flows is presented in Note 13.

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

5

Osisko Gold Royalties Ltd

Consolidated Statement of Changes in Equity

For the three months ended March 31, 2024

(tabular amounts expressed in thousands of Canadian dollars)

	Number of			Accumulated
	common			other
	shares	Share	Contributed	comprehensive
	outstanding	capital	surplus	income (i)	Deficit	Total
			($)	($)	($)	($)	($)
Balance - January 1, 2024	185,346,524		2,097,691	79,446	28,058	(554,697)	1,650,498
Net earnings	-		-	-	-	15,073	15,073
Other comprehensive income	-		-	-	17,524	-	17,524
Comprehensive income	-		-	-	17,524	15,073	32,597
.	.	.	.		.
Dividends declared	-		-	-	-	(11,154)	(11,154)
Shares issued - Dividends reinvestment plan	42,011		765	-	-	-	765
Shares issued - Employee share purchase plan	4,203		82	-	-	-	82
Share options - Share-based compensation	-		-	615	-	-	615
Share options exercised	358,457		6,088	(1,269)	-	-	4,819
Restricted share units to be settled in common shares:
Share-based compensation	-		-	1,264	-	-	1,264
Settlements	133,796		1,699	(3,330)	-	(915)	(2,546)
Income tax impact	-		-	(55)	-	-	(55)
Deferred share units to be settled in common shares:
Share-based compensation	-		-	238	-	-	238
Settlements	19,351		271	(590)	-	(124)	(443)
Income tax impact	-		-	261	-	-	261
Transfer of realized loss on financial assets at fair value through
other comprehensive income, net of income taxes	-		-	-	49	(49)	-
Balance - March 31, 2024	185,904,342		2,106,596	76,580	45,631	(551,866)	1,676,941

1. As at March 31, 2024, accumulated other comprehensive income comprises items that will not be recycled to the consolidated statements of income amounting to ($8.3 million) and items that may be recycled to the consolidated statements of income amounting to $54.0 million.

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

6

Osisko Gold Royalties Ltd

Consolidated Statement of Changes in Equity

For the three months ended March 31, 2023

(tabular amounts expressed in thousands of Canadian dollars)

	Number of			Accumulated
	common			other
	shares	Share	Contributed	comprehensive
	outstanding	capital	surplus	income (i)	Deficit	Total
			($)	($)	($)	($)	($)
Balance - January 1, 2023	184,037,728		2,076,070	77,295	47,435	(463,589)	1,737,211

Net earnings	-
Other comprehensive loss	-
Comprehensive (loss) income	-
Dividends declared	-
Shares issued - Dividends reinvestment plan	22,012
Shares issued - Employee share purchase plan	4,982
Share options - Share-based compensation	-
Share options exercised	659,515
Restricted share units to be settled in common shares:
Share-based compensation	-
Income tax impact	-
Deferred share units to be settled in common shares:
Share-based compensation	-
Income tax impact	-
Balance - March 31, 2023	184,724,237

-	-	-	20,848	20,848
-	-	(1,883)	-	(1,883)
-	-	(1,883)	20,848	18,965
-	-	-	(10,160)	(10,160)
368	-	-	-	368
82	-	-	-	82
-	843	-	-	843
11,056	(2,208)	-	-	8,848
-	1,075	-	-	1,075
-	805	-	-	805
-	371	-	-	371
-	654	-	-	654
2,087,576	78,835	45,552	(452,901)	1,759,062

1. As at March 31, 2023, accumulated other comprehensive income comprises items that will not be recycled to the consolidated statements of income amounting to ($11.2 million) and items that may be recycled to the consolidated statements of income amounting to $56.7 million.

The notes are an integral part of these unaudited condensed interim consolidated financial statements.

7

Osisko Gold Royalties Ltd

Notes to the Consolidated Financial Statements

For the three months ended March 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)

1. Nature of activities
   Osisko Gold Royalties Ltd and its subsidiaries (together, "Osisko" or the "Company") are engaged in the business of acquiring and managing royalties, streams and similar interests on precious metals and other commodities that fit the Company's risk/reward objectives. Osisko is a public company domiciled in the Province of Québec, Canada, whose shares trade on the Toronto Stock Exchange and the New York Stock Exchange and is constituted under the Business Corporations Act (Québec). The address of its registered office is 1100, avenue des Canadiens-de-Montréal, Suite 300, Montréal, Québec. The Company owns a portfolio of royalties, streams, offtakes, options on royalty/stream financings and exclusive rights to participate in future royalty/stream financings on various projects. The Company's main asset is a 3-5% net smelter return
   ("NSR") royalty on the Canadian Malartic Complex, located in Québec, Canada.
2. Basis of presentation
   These unaudited condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IASB") applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting. The condensed interim consolidated financial statements should be read in conjunction with the Company's annual consolidated financial statements for the years ended December 31, 2023 and 2022, which have been prepared in accordance with IFRS Accounting Standards as issued by the IASB. The accounting policies, methods of computation and presentation applied in these unaudited condensed interim consolidated financial statements are consistent with those of the previous financial year.
   Certain new accounting standards and interpretations have been published that are currently effective requirements or forthcoming requirements. These standards are not expected to have a material impact on the Company's current or future reporting periods and are therefore not discussed herein, with the exception of the amendments to IAS 1, Presentation of Financial Statements (Non-currentLiabilities with Covenants), and IFRS 18, Presentation and Disclosure in Financial Statements, which are discussed below.
   Amendments - IAS 1 Presentation of Financial Statements (Non-current Liabilities with Covenants)
   Amendments made to IAS 1 in 2020 and 2022 clarified that liabilities are classified as either current or non-current, depending on the rights that exist at the end of the reporting period. Classification is affected by the entity's expectations or events after the reporting date (e.g. the receipt of a waiver or a breach of covenant).
   Covenants of loan arrangements will not affect classification of a liability as current or non-current at the reporting date if the entity must only comply with the covenants after the reporting date. However, if the entity must comply with a covenant either before or at the reporting date, this will affect the classification as current or non-current even if the covenant is only tested for compliance after the reporting date.
   The amendments require disclosures if an entity classifies a liability as non-current and that liability is subject to covenants that the entity must comply with within 12 months of the reporting date. The disclosures include:
3. • the carrying amount of the liability;
   • information about the covenants; and
   • facts and circumstances, if any, that indicate that the entity may have difficulty complying with the covenants.

The amendments also clarify what IAS 1 means when it refers to the "settlement" of a liability. Terms of a liability that could, at the option of the counterparty, result in its settlement by the transfer of the entity's own equity instrument can only be ignored for the purpose of classifying the liability as current or non-current if the entity classifies the option as an equity instrument. However, conversion options that are classified as a liability must be considered when determining the current/non-current classification of a convertible note.

The amendments must be applied retrospectively in accordance with the normal requirements in IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors and are effective for annual reporting periods beginning on or after January 1, 2024. These amendments did not have an impact on the Company's consolidated financial statements for the three months ended March 31, 2024.

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Osisko Gold Royalties Ltd

Notes to the Consolidated Financial Statements

For the three months ended March 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)

2. Basis of presentation (continued)

IFRS 18 - Presentation and Disclosure in Financial Statements

In April 2024, the IASB issued IFRS 18, the new standard on presentation and disclosure in financial statements, with a focus on updates to the statement of profit or loss. IFRS 18 was issued in response to investors' concerns about the comparability and transparency of entities' performance reporting. The new requirements introduced in IFRS 18 will help to achieve comparability of the financial performance of similar entities, especially related to how 'operating profit or loss' is defined. The new disclosures required for some management-defined performance measures will also enhance transparency. The key new concepts introduced in IFRS 18 relate to:

• the structure of the statement of profit or loss;
• required disclosures in the financial statements for certain profit or loss performance measures that are reported outside an entity's financial statements (that is, management-defined performance measures); and
• enhanced principles on aggregation and disaggregation which apply to the primary financial statements and notes in general.

IFRS 18 will replace IAS 1; many of the other existing principles in IAS 1 are retained, with limited changes. IFRS 18 will not impact the recognition or measurement of items in the financial statements, but it might change what an entity reports as its 'operating profit or loss'.

IFRS 18 will apply for reporting periods beginning on or after January 1, 2027 and also applies to comparative information. Management has not yet evaluated the impact that this new standard will have on its consolidated financial statements.

3. Cash

As at March 31, 2024 and December 31, 2023, the consolidated cash position was as follows:

	March 31,		December 31,
	2024		2023
	$	$
Cash held in Canadian dollars	21,293	42,163
Cash held in U.S. dollars (i)	49,308	25,558
Total cash	70,601	67,721

1. Cash held in U.S. dollars amounted to US$36.4 million as at March 31, 2024 (US$19.3 million as at December 31, 2023

4. Short-term investments

As at March 31, 2024, short-term investments were comprised of a US$6.9 million ($9.3 million) note receivable from an associate, bearing an interest rate of 18.5% and having a maturity date of May 31, 2024. The note receivable is secured by the assets of the associate.

9

Osisko Gold Royalties Ltd

Notes to the Consolidated Financial Statements

For the three months ended March 31, 2024 and 2023

(tabular amounts expressed in thousands of Canadian dollars, except per share amounts)

5. Investments in associates

	Three months ended		Year ended
		March 31,		December 31,
		2024		2023
	$	$
Balance - Beginning of period	115,651	319,763
Acquisitions	-	271
Disposals	-	(127,931)
Share of (loss) income, net (i)	(13,558)	7,925
Share of other comprehensive loss	(2,708)	(6,795)
Net gain on ownership dilution	-	4,842
Loss on disposal and deemed disposal	-	(10,494)
Transfers to other investments	-	(7,159)
Impairments		-	(64,771)
Balance - End of period		99,385	115,651

1. The net share of income or loss is adjusted to the extent that management is aware of material events that affect the associates' net income or loss during the period where earnings in equity accounted for investments are recorded on up-to a 3-month lag basis, which is the case for the investment in Osisko Development Corp. ("Osisko Development"). The Company recorded estimated adjustments and impairments on its investment in Osisko Development of $64.5 million in the fourth quarter of 2023. During the three months ended March 31, 2024, the Company adjusted its share of recorded fourth quarter losses of Osisko Development for the impairment previously estimated and recorded against the investment in 2023.

6. Other investments

	Three months ended		Year ended
			March 31,		December 31,
		2024		2023
	$	$
Fair value through profit or loss (warrants and convertible instruments)
Balance - Beginning of period	8,949	24,217
Disposal	-	(5,000)
Interest capitalized	-	2,888
Change in fair value		456	(13,156)
Balance - End of period	9,405	8,949
Fair value through other comprehensive income (common shares)
Balance - Beginning of period	84,076	18.337
Acquisitions	-	53,008
Transfer from associates	-	7,159
Change in fair value	2,263	5,915
Disposals	(3,282)	(28)
Foreign exchange revaluation impact		1,615	(315)
Balance - End of period	84,672	84,076
Amortized cost (notes)
Balance - Beginning of period	-	30,950
Change in allowance for expected credit loss and write-offs	1,895	(30,615)
Repayment	(1,895)	-
Foreign exchange revaluation impact		-	(335)
Balance - End of period		-	-
Total		94,077	93,025

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