Altius Reports Q2 2021 Attributable Royalty Revenue of $21.9M and Announces Dividend Increase
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
August 9, 2021 | St. John’s, Newfoundland
Altius Reports Q2 2021 Attributable Royalty Revenue of $21.9M and Announces Dividend
Increase
Altius Minerals Corporation (TSX: ALS; OTCQX: ATUSF) (“Altius” or the “Corporation”)
reports attributable royalty revenue(1) of $21.9 million ($0.53 per share(1)) for the quarter ended
June 30, 2021. This represents an increase of 23% from Q1 2021 royalty revenue of $17.8 million
($0.43 per share) and 68% from its year over year comparable quarter, when $13.0 million was
reported.
Adjusted EBITDA(1) for the quarter was $17.7 million or $0.43 per share, up 21% from Adjusted
EBITDA of $14.6 million ($0.35 per share) in Q1 2021, and up 76% from the Q2 2020 comparable
quarter, when $10 million ($0.24 per share) was reported. The adjusted EBITDA margin for the
second quarter was 81%.
Adjusted operating cash flow of $5.8 million ($0.14 per share) compares to $8.8 million ($0.21 per
share) in Q1 2020 and $13.4 million ($0.32 per share) in Q2 2020. The main factor in the lower
adjusted operating cash flow during Q2 2021 is due to the timing of corporate tax installments as
well as working capital changes.
Net earnings in Q2 2021 are $14.6 million, and on an adjusted basis are $10.5 million or $0.25
per share, compared to adjusted earnings of $6. 1 million or $0.14 per share in Q1 2021 and to
adjusted earnings of $1.4 million or $0.04 per share in Q2 2021. The ma in adjusting item in the
current quarter is a $0.16 gain on the derecognition of Adventus Mining Corporation (“Adventus”)
as an associate and its reclassification to mining and other Investments. Adventus had been
equity accounted up until Q2 this year, when Altius elected to forego its board nomination rights.
Additional gains of $0.04 per share include foreign exchange gains and gains on disposal of
mineral properties that were offset by non-cash impairment charges of ($0.05) per share related
to the Corporation’s Manitoba diamond exploration properties and a charge of ($0.02) per share
related to the fair value adjustment of a derivative. The full table reconciling adjusted net earnings
per share to net earnings per share is included below.
Portfolio Performance
Base metals (copper, nickel, zinc and cobalt) revenue of $9.4 million accounted for 4 3% of
total attributable royalty revenue ( 43% Q1 202 1). Performance in the quarter was positively
impacted by stronger metal prices but was partiall y offset by the mining of lower grade areas at
both 777 and Chapada. Lundin Mining has tightened guidance for current year production at
Chapada to 48,000 - 50,000 tonnes. Lundin Mining continued to aggressively drill near mine
targets at Chapada in support of ongoing project expansion studies. During the quarter, Vale
commenced production from its new underground Reid Brook mine while continuing work to
commission the Eastern Deeps deposit at Voisey’s Bay. A nominal payment was received from
Gunnison related to sales of copper recovered during start -up operations. Work continued in
support of a resource update and feasibility study for the El Domo deposit with results expec ted
later this year.
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
Potash royalty revenue of $4.5 million accounted for 2 1% of total attributable royalty revenue
(23% in Q1 2021). Potash revenue on a year-to-date basis has increased 2% from 2020 which
included a one -time addition of $690,000 related t o a reconciliation of prior period payments.
Steady global potash price improvements over the past year continued while overall portfolio
based production was in -line with recent prior periods. Average realized prices for royalty
calculation purposes continued to reflect timing of sales recognition lags with realized prices in
the second quarter generally aligned with the first quarter’s market prices. Market prices based
on US Midwest and Brazil delivery increased by 50 -60% during Q2 and these are expecte d to
result in higher realized prices to Altius in the coming quarters. During the quarter, Mosaic closed
its Esterhazy K1 and K2 mining shafts while it continues to ramp up production from the new K3
mining shaft which is expected to reach full capacity e arly in 2022. Nutrien announced two
500,000 tonne increases to its annual potash production guidance during the quarter in response
to increased demand.
Iron ore royalty revenue of $5.0 million accounted for 23% of total royalty revenue (16% in Q1
2021). The Corporation’s current iron ore revenue stems from the pass -through of royalties and
equity dividends paid by the Rio Tinto controlled Iron Ore Company of Canada (“IOC”) to Labrador
Iron Ore Royalty Corp (“LIORC”), of which the Corporation is a signifi cant shareholder. LIORC
operates as a passive flow-through vehicle for proceeds from a 7% gross overriding royalty and
a 15.1% equity position held by LIORC on the IOC operations in Labrador, Canada. The
significant increase reflected strong royalty revenue and a significant equity dividend paid by IOC
as it continued to benefit from strong demand and pricing for its high-purity iron ore products.
During the prior quarter IOC declared force majeure on certain customer shipments due to a fire
at its port facilities that resulted in reduced ship-loading rates. Force majeure has since been lifted
and IOC has re-iterated full year production and sales guidance as it expects to be able to offset
current shortfalls with increased loading rates in the remainder of the year.
Thermal coal royalty revenue of $2.1 million accounted for just under 10% of total royalty revenue
(16% in Q1 202 1). The decline in revenue from Q1 2021 and from Q2 2020 is lar gely due to
slightly lower seasonal electricity demand at the inte grated Genesee mine and power plant and
only nominal revenue from the other coal operations.
Renewables based revenue was $55,000 relating to the legacy hydro royalty in ARR’s jointly
controlled subsidiary Great Bay Renewables LLC (“GBR”). During the second quarter ended
June 30, 2021 GBR announced the sale of five additional renewable energy projects by investee
company Tri Global Energy (“TGE”). These included the 180 MW Hoosier Line Wind project (3%
royalty), the 400 MW Honey Creek Solar project (1.5% royalty), the 200 MW Blackford Wind
project (3% royalty) and the 150 MW Blackford Solar (1.5% royalty) to Leeward Renewable
Energy, a portfolio company of Canadian pension fund subsidiary OMERS Infrastructure. In
addition, ARR announced the sale of its 175 MW Appaloosa Run Wind project (1.5% royalty) in
West Texas to an established buyer.
Subsequent to quarter end on August 3, 2021, ARR announced the closing of a US$35 million
royalty investment with Longroad Energy (“Longroad”) related to its 331 MWdc (250 MWac)
Prospero 2 solar project in Texas. This represents the first operating royalty investment that ARR
has made. Annual revenue from Prospero 2 is expected to be approximately US$850,000 per
year starting on January 1, 2022 and continuing through 2026 before then stepping up to
approximately US$4,700,000 per year for the following five years. On average, annual revenue
is expected to be approximately US$4.0-4.5 million over an initial expected 30 -year project life.
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
Longroad is a top -tier-developer, owner and operator of renewable energy projects, having
developed over 60 renewable energy projects totaling over 6 GWs across North America.
ARR, through GBR, has now established royalties on 10 projects under its financing agreements
that collectively represent approximately 2495 MW of solar and wind power while continuing to
advance due diligence investigations and negotiations with several other renewable energy
operators and developers relating to additional potential royalty financing transactions.
The following tables summarize the financial results and attributable revenue for the three and six
months ended June 30, 2021 and 2020:
Ju ne 3 0, 2021 Ju ne 3 0, 2020 Va r ia nce Ju ne 3 0, 2021 Ju ne 3 0, 2020 Va r ia nce
Revenu e
Attributable royalty 21,906$ 13,035$ 8,871$ 39,666$ 29,314$ 10,352$
Project generation - - - 408 - 408
Attributable revenue (1) 21,906 13,035 8,871 40,074 29,314 10,760
Adjust: joint venture revenue (708) (2,765) 2,057 (1,374) (5,995) 4,621
IFRS revenue per consolidated financial statements 21,198 10,270 10,928 38,700 23,319 15,381
Total assets 746,151$ 598,873$ 147,278$ 746,151$ 598,873$ 147,278$
Total liabilities 200,328 208,932 (8,604) 200,328 208,932 (8,604)
Dividends declared & paid to shareholders 2,073 1,945 128 4,147 4,035 112
Adjusted EBITDA (1) 17,712 10,048 7,664 32,302 22,771 9,531
Adjusted operating cash flow (1) 5,830 13,378 (7,548) 14,640 26,606 (11,966)
Net earnings (loss) 14,549 4,105 10,444 26,353 938 25,415
Attributable revenue per share (1) 0.53$ 0.31$ 0.22$ 0.96$ 0.70$ 0.26$
Adjusted EBITDA per share (1) 0.43 0.24 0.19 0.78 0.54 0.24
Adjusted operating cash flow per share (1) 0.14 0.32 (0.18) 0.35 0.64 (0.29)
Net earnings (loss) per share, basic and diluted 0.38 0.10 0.28 0.66 0.02 0.64
(1) See non-IFRS measures section for definition and reconciliation
In Tho usands o f C anadi an D o l l ars, e xce pt pe r share
amo unts
Six mont hs end edThr ee mont hs end ed
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
In Tho usands o f C anadi an D o l l ars
Su mma r y of a t t r ibu t a ble r oya lt y r evenu e
Ju ne 3 0,
2021
Ju ne 3 0,
2020
Va r ia nce
Ju ne 3 0,
2021
Ju ne 3 0,
2020
Va r ia nce
Revenue
Ba s e met a ls
777 Mine 4,635$ 2,224$ 2,411$ 8,170$ 4,523$ 3,647$
Chapada 4,095 2,518 1,577 7,556 6,651 905
Voisey's Bay 653 93 560 1,284 220 1,064
Gunnison 11 - 11 11 - 11
Met a llu r gica l Coa l
Cheviot - 466 (466) 58 1,056 (998)
Ther ma l (Elect r ica l) Coa l
Genesee 2,153 1,494 659 4,600 2,820 1,780
Paintearth 20 - 20 20 75 (55)
Sheerness (33) 565 (598) 446 1,595 (1,149)
Highvale - 147 (147) - 229 (229)
Pot a s h
Cory 367 271 96 679 494 185
Rocanville 2,398 2,318 80 4,760 5,294 (534)
Allan 416 188 228 639 384 255
Patience Lake 150 100 50 306 239 67
Esterhazy 1,143 1,127 16 2,110 1,988 122
Vanscoy 35 - 35 84 9 75
Lanigan 7 8 (1) 11 10 1
I r on or e ( 1 ) 5,029 1,293 3,736 7,903 2,299 5,604
O t her
Renewables 55 112 (57) 90 1,019 (929)
Coal bed methane 110 72 38 263 206 57
Interest and investment 662 39 623 677 203 474
At t r ibu t a ble r oya lt y r evenu e 21,906$ 13,035$ 8,871$ 39,666$ 29,314$ 10,353$
(1) LIORC dividends received
See non-IFRS measures section of this MD&A for definition and reconciliation of attributable revenue
Thr ee mont hs end ed Six mont hs end ed
Notes
1. Attributable revenue , adjusted EBITDA and adjusted operating cash flow (and respective per share amounts) are intended to provide
additional information only and do not have any standardized meaning prescribed under IFRS and should not be considered in is olation or
as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these measures differently.
The attributable revenue , adjusted EBITDA and adjusted operating cash flow per share metrics divide the respective values by the basic
weighted average number of shares outstanding during the period. For a reconciliation of these measures to various IFRS measures, please
see the Corporation’s MD&A which is available at http://www.altiusminerals.com.
2. Adjusted earnings and respective per share amounts are intended to provide additional information only and do not have any standa rdized
meaning prescribed under IFRS and should not be considered in isolation or as a substitute for measures of performance prepa red in
accordance with IFRS. Other companies may calculate these measures differently. The calculations used for the adjusted earnings per share
are as follows:
June 30, 2021 June 30, 2020
Reported earnings (loss) per share 0.38$ 0.10$
Adjusted for:
Equity investments and joint ventures (0.16) 0.01
Derivatives and foreign exchange 0.01 (0.07)
Impairment charges 0.05 -
Gain on disposal of mineral properties (0.03) -
Adjusted earnings per share 0.25$ 0.04$
Equity accounted for (gains) and losses 0 0
Impairments 0.01 0
Foreign currency (gains) losses -0.03 0
(Gain) loss on adjustment of derivatives -0.03 0
(Gain) on disposition of royalty interest -0.01 0
(Gain) on disposition of mineral property -0.05 -0.07
(Gain) on deconsolidation of subsidiary 0 0
Tax adjustments -0.01 -0.04
Investment in associates 0 0.02
0.18 0.12
Three months ended
Adjusted Earnings per Share
In T housands of Canadian Dollars, except per share amounts
Additional information on the Corporation’s results of operations and developments in its Project
Generation division are included in the Corporation’s MD&A and Financial Statements which
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
were filed on SEDAR today and are also available on the Corporation’s website at
www.altiusminerals.com.
Capital Allocation Summary
The Corporation’s capital allocation priorities are linked to its strategy of creating per share value
growth through a portfolio of assets that relate to long life, high margin operations while providing
growing shareholder capital returns.
During the quarter, the Corporation made scheduled debt repayments of $5 million and paid cash
dividends of $1.9 million and preferred distributions of $1.2 million.
Liquidity and Dividend Declaration
Cash and cash equivalents at June 30, 2021 was $115.9 million, compared to $21.8 million at the
end of 2020. $96.7 million of the cash balance is held by ARR, which raised proceeds through a
successful IPO in March 2021 , followed by a partial overallotment exercise in Q2 2021. These
funds are designated to support the renewable energy royalty growth platform. Cash excluding
the ARR funds was $19 million at June 30, 2021 and the value of publicly traded Project
Generation business equity holdings was $64.5 million.
Debt Facilities Refinanced
Subsequent to quarter end the Corporation received commitment from lenders to amend its credit
facility to increase the available credit to from $160 million to $225 million and to extend the term
from June 2023 to August 2025. In addition, the required principal payments will be reduced from
$5 million to $2 million quarterly and other covenant restrictions will be adjusted to better reflect
the growing financial strength and revenue profile of the business. The Corporation’s outstanding
debt was $122 million at June 30 th, 2021 and upon closing, the total available under the credit
facility will be $108 million.
Dividend Increase
The Corporation advises that its board of directors has elected to increase its regular quarterly
dividend by 40% from $0.05 to $0.07 per common share in reflection of its long -term positive
outlook for its business. The current quarterly dividend is payable to all shareholders of record at
the close of business on August 31, 2021.
The dividend is expected to be paid on or about September 15, 2021. This dividend is eligible for
payment in common shares under the Dividend Reinvestment Plan (DRIP) announced by press
release May 20, 2020, and available to shareholders who are Canadian residents or residents of
countries outside the United States. In order to be eligible to participate in respect of the
September 15, 2021 dividend, non -registered shareholders must provide instruction to their
brokerage and registered shareholders must provide completed enrollment forms to the transfer
agent by August 24, 2021, five business days prior to record date. Stock market purchases made
under the DRIP for the September 15, 2021 payment will be satisfied by issuance from treasury
at a 5% discount to the 5 day volume weighted average price ending at the close of trading the
day before payment date. Shareholders who have already provided instruction to be enrolled
earlier this year will continue to be enrolled unless they direct otherwise. For more information,
please see http://www.altiusminerals.com/dividend-reinvestment-plan. Participation in the
DRIP is optional and will not impact any cash dividends payable to shareholders who do not elect
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
to participate in the DRIP. The declaration, timing and payment of future dividends will largely
depend on the Corporation’s financial results as well as other factors. Dividends paid by Altius on
its common shares are eligible dividends for Canadian income tax purposes unless otherwise
stated.
Second Quarter 2021 Financial Results Conference Call and Webcast Details
Additional details relating to individual royalty performances and asset level developments will be
provided with the release of full financial results, which will occur on August 9, 2021 after the close
of market, with a conference call to follow on August 10, 2021.
Date: August 10, 2021
Time: 9:00 AM ET
Toll Free Dial-In Number: +1(866) 521-4909
International Dial-In Number: +1(647) 427-2311
Conference Call Title and ID: Altius Q2 2021 Results, ID 9379845
Webcast Link: Q2 2021 Financial Results
About Altius
Altius’s strategy is to create per share growth through a diversified portfolio of r oyalty assets that relate to
long life, high margin operations. This strategy further provides shareholders with exposures that are well
aligned with sustainability -related global growth trends including the electricity generation transition from
fossil fuel to renewables, transportation electrification, reduced emissions from steelmaking and increasing
agricultural yield requirements. These macro-trends each hold the potential to cause increased demand for
many of Altius’s commodity exposures including copper, renewable based electricity, several key battery
metals (lithium, nickel and cobalt), clean iron ore, and potash. In addition, Altius runs a successful Project
Generation business that originates mineral projects for sale to developers in exchange for equity positions
and royalties. Altius has 41,504,597 common shares issued and outstanding that are listed on Canada’s
Toronto Stock Exchange. It is a member of both the S&P/TSX Small Cap and S&P/TSX Global Mining
Indices.
Forward-looking information
This news release contains forward ‐looking information. The stateme nts are based on reasonable
assumptions and expectations of management and Altius provides no assurance that actual events will
meet management's expectations. In certain cases, forward ‐looking information may be identified by such
terms as "anticipates", "believes", "could", "estimates", "expects", "may", "shall", "will", or "would". Although
Altius believes the expectations expressed in such forward ‐looking statements are based on reasonable
assumptions, such statements are not guarantees of future perfor mance and actual results or
developments may differ materially from those projected. Readers should not place undue reliance on
forward-looking information. Altius does not undertake to update any forward-looking information contained
herein except in accordance with securities regulation.
For further information, please contact:
Flora Wood
Email: [email protected]
Tel: 1.877.576.2209
Ben Lewis
Email: [email protected]
Tel: 1.877.576.2209
TS X: ALS | OTCQX: ATUSF Altiu s Minerals Corporation
Direct: +1(416)346.9020