UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): November 3, 2008
Royal Gold, Inc.
(Exact Name of Registrant as Specified in Charter)
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Delaware
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001-13357
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84-0835164 |
(State or Other Jurisdiction
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(Commission
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(IRS Employer |
of Incorporation)
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File Number)
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Identification No.) |
1660 Wynkoop Street, Suite 1000, Denver, CO 80202
(Address of Principal Executive Offices) (Zip Code)
Registrants telephone number, including area code: 303-573-1660
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 4.02(a). Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or
Completed Interim Review
On
November 3, 2008, the Audit Committee of the Board of Directors of Royal Gold, Inc. (the Company)
determined that due to an error in accounting for revenue from certain royalty interests, the
Companys previously issued financial statements for fiscal year
ended June 30, 2008 and for each of the quarters comprising the
fiscal year can no longer
be relied upon and should be restated. As part of the Companys royalty monitoring program, Royal
Gold has identified a $3.1 million overpayment from Barrick Gold Corporation (Barrick) with
respect to the Companys GSR1 and GSR2 royalties at the Cortez Pipeline Mining Complex, which the
Company received and had previously recognized as royalty revenue. The overpayment of the royalty
was the result of Barrick incorrectly including non-Royal Gold royalty production in the Companys
quarterly GSR1 and GSR2 royalty payments, principally during fiscal
year 2008. The Company failed to note these overpayments and
incorrectly included them in revenue. The effect of the
restatement on our fiscal year 2008 results of operations reduced royalty revenues by $3.1 million
from $69.4 million to $66.3 million, reduced net income by $2.1 million from $26.1 million to $24.0
million, and reduced earnings per share by $0.07 from $0.69 to $0.62. The Company intends to file
an amended Annual Report on Form 10-K/A for fiscal year 2008 on or before November 10, 2008. While
management expects to report the estimated impacts described above, there can be no assurance that
the final adjustments that are made as part of the restatement will not differ materially from
these estimates.
As a result of the error, management has reassessed the Companys controls and procedures,
including internal controls over financial reporting as of June 30,
2008. Management has concluded that there was a
deficiency in the operating effectiveness of the Companys controls in place over the accuracy of
royalty revenue which constituted a material weakness in the Companys disclosure controls and
procedures and internal controls over financial reporting. Managements conclusions regarding
disclosure controls and procedures and report on internal control over financial reporting will be
included in the amended Annual Report on Form 10-K/A for fiscal year 2008. In response to the
error, management is working to enhance its controls and procedures over its royalty monitoring
program to ensure that royalty payments associated with production
that is not subject to the Company's
royalty interests is properly reconciled and reviewed on a timely
basis.
The Audit
Committee and management have discussed the matters set forth in this Current Report on
Form 8-K with the Companys independent registered public accounting firm, PricewaterhouseCoopers
LLP.
Cautionary Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995:
With the exception of historical matters, the matters discussed in this press release are
forward-looking statements that involve risks and uncertainties that could cause actual results to
differ materially from projections or estimates contained herein. Such forward-looking statements
include statements regarding the quantitative effects of the restatement and effectiveness of any
changes in disclosure controls or procedures, or internal control over financial reporting.
Factors that could cause actual results and the restatements quantitative effects include, among
others, the risk that additional information may arise during the completion of the Companys work
on the restatement, the Companys independent auditors review of the restated financial
statements, the Audit Committees final review of the restated financial statements, the Companys
ability to successfully remediate identified control deficiencies, litigation and governmental
investigations or proceedings arising out of or related to accounting and financial reporting
matters, other subsequent events, as well as other factors described elsewhere in this press
release and in the Companys Annual Report on Form 10-K and other filings with the Securities and
Exchange Commission. Certain of these factors are beyond the Companys ability to predict or control.
The Company disclaims any obligation to update any forward-looking statement made herein. Readers
are cautioned not to put undue reliance on forward-looking statements.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
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99.1
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Press Release dated November 4, 2008. |
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