Royal Gold, Inc. is the largest U.S.-based precious metals  royalty company. Royal Gold provides a unique way to invest in precious metals — by investing in a public company that holds  and manages royalties on precious metals properties.Through its portfolio of royalty interests, the Company holds investments in a number of properties without incurring ongoing capital or operat- ing costs, and thus provides low risk exposure to gold and precious metals income. CORPORATE PROFILE The Company is a Denver-based, publicly held corporation. Management and directors beneficially own about 30% of the shares of the Company. Royal Gold is traded on the Nasdaq Stock Market, under the symbol “RGLD,” and on the Toronto Stock Exchange, under the symbol “RGL.” Royal Gold seeks to create a collaborative relationship with royalty owners and mine operators, so that it becomes the royalty company of choice. Management’s philosophy is to do deals only when they make sense — in other words,“smart growth.” The Company’s royalty portfo- lio now provides an excellent risk-to-reward profile.The key elements of our business strategy are: Royal Gold’s philosophy is to grow by acquiring royalties on precious  metals mines that have potential for growth and leverage to precious  metals price increases. TABLE OF CONTENTS  BUSINESS STRATEGY COVER 1 Highlights 2 Letter to Shareholders 4 Property Portfolio  10 Corporate Responsibility 11 The Gold Market 12 Glossary 13 Financial Review 1 acquiring and holding royalties on high quality deposits that are or will be exploited by competent operators; 2 holding royalties on properties that have upside potential; 3 holding a portfolio of producing royalties, involving various  precious metals, to diversify commodity risk; 4 having a productive staff, motivated by significant equity owner- ship in the company; 5 possessing strong deal making and diligence skills; 6 having a publicly traded stock to use as a currency for  acquisitions; and 7 being a core portfolio precious metals investment.