
December 11, 2013	TSX-V: CAA
Quarterly Letter to Shareholders of Callinan Royalties Corporation On November 28, 2013, we released Financial Statements and Management Discussion and Analysis for the first fiscal quarter ended September 30, 2013. All financial figures are in Canadian dollars. This quarterly letter reviews highlights of the first quarter results and recent developments. Financial Performance The following are highlights of the first quarter: � $981,848 was paid out in dividends to shareholders. � Cash on hand at September 30, 2013 was $27,155,571 compared to $30,234,769 at September 30, 2012. � Callinan announced it would recommence litigation by filing an amended statement of claim against Hudson Bay Mining & Smelting Co. Ltd., a subsidiary of Hudbay Minerals Inc. � As announced on July 23, 2013, Callinan completed a staged royalty investment with Excelsior Mining. Callinan has acquired a 0.5% Gross Revenue Royalty on the Gunnison Copper Project in Arizona and holds the right to increase this royalty following completion of key milestones. � Net income for the 3 month period ended September 30, 2013 net of income tax expense was $1,706,791. Following the quarter, Callinan announced the creation of two exploration alliances. 777 Mines - Operational Overview The 777 mine encountered some challenges earlier this year, yet there were production increases at the 777 mine and increased contributions from the 777 North ramp. With weaker metal markets, our royalty revenue for the recent quarter was negatively impacted. However, operational issues have been managed and Hudbay has reported that mining of higher grade copper zones is planned for the future. Hudbay's quarterly MD&A provides more details. For further disclosure on Hudbay's mining operations, please see www.hudbayminerals.com. Investments Callinan announced two exploration alliances in recent months for the purpose of creating royalties. � Avrupa Minerals: Creation of royalties on base metal targets in Portugal. � Renaissance Gold: Creation of royalties on gold exploration projects in southern Nevada. As part of these alliances, Callinan has agreed to fund a $150,000 exploration program on the Alvito Project in Portugal in exchange for a 1.5% net smelter returns ("NSR") royalty. Callinan also agreed to fund a $150,000 exploration program on the Golden Shears project in Nevada in exchange for a 1.5% NSR royalty. Avrupa and Renaissance will seek joint venture partners for projects that are generated or funded by royalty financing. The Callinan Share The total volume of trading in Callinan shares during September, October and November was 2,938,805 with an average daily volume of 46,648. This represents an annualized share turnover of 24%. Since introduction of the dividend policy in late 2011, Callinan has paid approximately $6.9 million in dividends to shareholders. The quarterly dividend has been maintained at $0.02 per share and is expected to be paid on or about January 15, 2014. The current dividend yield is near 5.0%. Under the current Normal Course Issuer Bid, we have repurchased 459,300 shares for cancellation during 2013. From September to November 2013, 362,900 shares were purchased at an average price of $1.61. All stock options have now been exercised and there are no current plans to issue additional stock options. Annual General Meeting The 2013 annual and special meeting of shareholders of the Company was held on Tuesday, December 3, 2013 in Vancouver at Boughton Law offices. All resolutions presented, with the exception of the Company's 2013 Stock Option Plan, were approved by shareholders. The resolution to approve By-Law number 4, "Advance Notice Policy" was withdrawn. The final voting results on each item of business and respective resolutions are filed on SEDAR. The slate of directors nominated by management was elected and includes four new directors with unparalleled skills, knowledge and experience to contribute to the company and serve the best interests of all Callinan shareholders. The new board appreciates the support of shareholders and looks forward to advancing the business of Callinan. At the meeting, a shareholder proposed six alternate director nominees and voting was conducted. The alternate slate was defeated. Summary The mining industry is within a prolonged downturn with few signs of near-term improvement. Metal prices have weakened and many mining companies are focused on cutting costs and deferring capital expenditures. The availability of capital has become constrained as investors see better opportunities elsewhere. Exploration-stage companies have been severely impacted by scarcity of risk capital. There continues to be strong competition within the mineral royalty sector. The premium valuations exhibited by all royalty companies have diminished over the past year. This is especially true for small royalty companies, which have experienced minimal cash flow from existing royalty assets and difficulty accessing sufficient additional investment and sustaining capital. In contrast, Callinan remains in strong financial condition. The company has positive cash flow and a healthy treasury. There is no need to raise capital to fund business activities and returns to shareholders remain a priority. We successfully completed three agreements in recent months to create royalties in geologically attractive and stable mining jurisdictions through agreements with companies with capable management. Nevertheless, we remain cautious in the current investment environment even though many opportunities have become available. All the Best, Roland Butler President and CEO, Callinan Royalties Corporation For more information visit: www.callinan.com
PROJECT OFFICE Roland Butler, CEO 508 Main Street Lewisporte, NL Canada, A0G 3A0 Phone: +1.709.535.3433 shareholder@callinan.com	CORPORATE OFFICE Tamara Edwards, CFO 1110 - 555 West Hastings Street Vancouver, BC Canada, V6B 4N4 Phone: +1.604.605.0885	UNSUBSCRIBE FROM THIS LIST

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	CODE : CAA.V
	ISIN : CA13124H1064

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Callinan Royalties is a silver and gold royalty company based in Canada.

Callinan Royalties produces silver, gold, copper, lead and zinc in Canada, develops copper, lead and zinc in Canada, and holds various exploration projects in Canada.

Its main assets in production are 777 MINE, COLES CREEK and CALLINAN MINE in Canada, its main assets in development are GUNNISON and WAR BABY in Canada and its main exploration properties are THOMPSON BELT in Cambodia and FLIN FLON, FOX RIVER MAFIC BELT, SNEATH LAKE, DION, BERRY CREEK, RAYFIELD, ECHO LAKE, CANDLE LAKE and CAL in Canada.

Callinan Royalties is listed in Canada and in United States of America. Its market capitalisation is 85.4 millions as of today (US$ 68.2 millions, € 60.0 millions).

Its stock quote reached its lowest recent point on December 31, 2001 at 0.07, and its highest recent level on December 31, 2010 at 3.37.

Callinan Royalties has 47 442 200 shares outstanding.

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Quarterly Letter to Shareholders of Callinan Royalties Corporation

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