Altius Reports Q1 2019 Royalty Revenue of $21.8M and Adjusted EBITDA of $17.4M
Date:
Ticker Symbol:
7-May 2019
ALS.TSX
Civic Address:
Altius Minerals Corporation
Suite 202, 66 Kenmount Road
St. John’s, NL, A1B 3V7, CANADA
Website: www.altiusminerals.com
Toll Free: 1.877.576.2209
Fax: 709.576.3441
e-mail: [email protected]
Mailing Address:
Altius Minerals Corporation
P.O. Box 8263 Stn “A”
St. John’s, NL, A1B 3N4, CANADA
Altius Reports Q1 2019 Royalty Revenue of $21.8M and Adjusted EBITDA of $17.4M
St. John’s – (TSX: ALS; OTCQX: ATUSF) Altius Minerals Corporation (“Altius” or the “Corporation”) reports attributable
royalty revenue(Note 1) of $21.8 million ($0.51 per share) for the quarter ended March 31, 2019 , a quarterly record which is
up 38% compared to Q1 2018 royalty revenue of $15.8 million and up 24% compared to Q4 2018 revenues of $17.6 million.
Total Q1 2019 revenue of $21.9 million includes a small contribution from our Project Generation division.
Adjusted EBITDA (Note 1) of $17.4 million ($0.41 per share) for the three months is also a record, and compares to $12.7
million ($0.29 per share) in Q1 2018 and $13.4 million ($0.31 per share) in Q4 2018. General and administrative expenses
in the first quarter were $2.8 million compared to $1.9 million in the comparable quarter last year, with most of the increas e
relating to the new renewable energy royalty subsidiary. Excluding corporate development and one -time structuring
expenditures, ongoing G&A expenditures for the new division are expected to be roughly US$1 million annually. Q1 2019
net earnings per share were $0.15 compared to $0.06 in Q1 2018 and a loss of $0.29 per share in Q4 2018, which included
non-cash impairment charges of $0. 28 per share. Q1 2019 earnings include a foreign exchange loss of $629,000 and a
$345,000 loss on revaluation of derivatives (share purchase warrants) , along with $1.2 million from the equity accounting
for Altius’s share of losses in Adventus Zinc Corporation (“Adventus”) and Alderon Iron Ore Corp.
Royalty revenue highlights are as follows:
• Base metal revenue of $7.6 million in Q1 2019 was up 6% from Q1 2018 revenue of $7.2 million, but with the
proportions from Chapada and 777 differing significantly, as Chapada revenue was $5.4 million in the quarter.
Despite lower prices year over year, Ch apada sales volume more than offset the price decrease, with
Chapada’s strong Q4 2018 production impacting royalty revenue in the first quarter this year. While 777 copper
volumes were up year over year, lower prices and continuing lower zinc production re sulted in lower overall
revenues. Voisey’s Bay revenue of $297,000 in Q1 2019 is relatively consistent with the quarterly revenue
recorded in Q3 and Q4 last year.
• Potash royalty revenue of $4.8 million is up 105% from Q1 2018, although the comparison partly reflects a
higher ownership level following an acquisition that closed in late March 2018. Q1 2019 revenue is up 29%
from Q4 2018 revenue of $3.7 million, with improvements in both price and attributable royalty production
volume.
• Indirect iron ore royalty revenue from an approximate 6.3% ownership of Labradaor Iron Ore Royalty
Corporation (“LIORC”) was $4.2 million, compared to $1.1 million in the comparable period of 2018 (strike -
impacted) and $2.1 million in Q4 2018. The ownership position in Q1 increased by approximately 540,000
shares over Q4 2018, but the main factor driving the increase was a return to the historical passive corporate
mandate and practice of paying a higher percentage of free cash flow as dividends.
• Met coal royalty revenue of $1.2 million was up 93% year over year , reflecting significantly higher production
volumes.
Date:
Ticker Symbol:
7-May 2019
ALS.TSX
Civic Address:
Altius Minerals Corporation
Suite 202, 66 Kenmount Road
St. John’s, NL, A1B 3V7, CANADA
Website: www.altiusminerals.com
Toll Free: 1.877.576.2209
Fax: 709.576.3441
e-mail: [email protected]
Mailing Address:
Altius Minerals Corporation
P.O. Box 8263 Stn “A”
St. John’s, NL, A1B 3N4, CANADA
The following tables summarize the financial results for the quarter ended March 31, 2019.
IN THOUSANDS OF CANADIAN DOLLARS (except per share amounts)
March 31, 2019 March 31, 2018
Revenue
Attributable royalty 21,844$ 15,805$
Project generation 9 292
Attributable revenue (1) 21,853 16,097
Adjust: joint venture revenue (4,780) (6,702)
IFRS revenue per consolidated financial statements 17,073 9,395
Net earnings (loss) 6,616$ 2,527$
Net earnings (loss) per share, basic and diluted 0.15 0.06
Total assets 613,108 583,770
Total liabilities 198,842 189,682
Cash dividends declared & paid to sharesholders (2) 1,714 3,456
(2) The Corporation declared and paid dividends of $3,456,000 to its shareholders in the three months ended March 31, 2018, of which
$1,728,000 related to dividends declared but unpaid in December 31, 2017.
(1) See non-IFRS measures section for definition and reconciliation
Three months ended
IN THOUSANDS OF CANADIAN DOLLARS
March 31, 2019 December 31, 2018 March 31, 2018
Revenue
Base metals
777 Mine 1,893$ 2,855$ 3,285$
Chapada 5,432 3,942 3,904
Voisey's Bay 297 622 -
Metallurgical Coal
Cheviot 1,215 859 757
Thermal (Electrical) Coal
Genesee 1,252 1,171 1,657
Paintearth 144 61 105
Sheerness 1,535 1,292 2,103
Highvale 337 540 234
Potash
Cory 324 253 108
Rocanville 2,895 1,946 1,484
Allan 241 166 90
Patience Lake 245 135 87
Esterhazy 1,083 1,161 544
Vanscoy 34 71 33
Lanigan 5 5 1
Iron ore (1) 4,233 2,097 1,103
Other
Renew ables 153 - -
Coal bed methane 160 240 211
Interest and investment 366 199 100
Attributable royalty revenue 21,844$ 17,615$ 15,805$
(1)LIORC dividends received
See non-IFRS measures section of this MD&A for definition and reconciliation of attributable revenue
Summary of attributable royalty revenue Three months ended
Date:
Ticker Symbol:
7-May 2019
ALS.TSX
Civic Address:
Altius Minerals Corporation
Suite 202, 66 Kenmount Road
St. John’s, NL, A1B 3V7, CANADA
Website: www.altiusminerals.com
Toll Free: 1.877.576.2209
Fax: 709.576.3441
e-mail: [email protected]
Mailing Address:
Altius Minerals Corporation
P.O. Box 8263 Stn “A”
St. John’s, NL, A1B 3N4, CANADA
Note
1. Attributable revenue and adjusted EBITDA are intended to provide additional information only and do not have any
standardized meaning prescribed under IFRS and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. Other companies may calculate these measures
differently. The attributable revenue and adjusted EBITDA per share metrics divide the respective values by the
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:/altiusminerals.com/financial-
statements.
Additional information on the Corpo ration’s results of operations and developments in its Project Generation division are
included in the Corporation’s MD&A and Financial Statements which were filed on SEDAR today and are also available on
the Corporation’s website at www.altiusminerals.com.
Outlook, Liquidity and Dividend Declaration
Cash at March 31, 2019 was $21.3 million. During the quarter, the Corporation drew down $25.2 million o n its revolving
credit facility , which was mainly used for investing purposes. The Corporation repaid $5 million in accordance with the
quarterly amortization schedule of its term debt, ending the quarter with total debt of $13 5 million. Subsequent to quarter
end, the Corpration repaid an additional $11 million on its revolving credit facility. Sales of equities net of reinvestment from
the Project Generation junior equities portfolio in the first quarter generated an additional $7.5 million.
Altius used $23.7 million to acquire investments, with $12.7 million going to the LIORC position increase and approximately
$991,000 for additional lithium royalty investments. In January 2019, Altius announced the acquisition from Resouce Capital
Fund of a 2% net smelter return royalty on the Curipamba copper-gold-zinc project, the flagship project of Adventus in
Ecuador. The purchase consideration was US$10 million, paid in cash . Adventus released an overview of a preliminary
economic assessment for the El Domo deposit, which is part of the Curipamba project, that indicated robust results. It has
also announced an equity financing, which is being led by Nobis Group, an Ecuador base d conglomerate, that includes
participation by several other of Adventus’s strategic shareholders (see Adventus press releases dated May 2 and May 6,
2019).
In February 2019, Altius announced the acquisition of Great Bay Renewables for $6,153,000 (US$5 million net of cash
assumed), a U.S. based company focussed on the acquisition and management of renewable energy royalties. We also
announced the subsequent investment of $9,840,000 (US$7.5 million) into the first renewable energy royalt y transaction
with Tri Global Energy LLC (“TGE”), a leading wind developer based in Texas. In exchange for its investment in TGE, which
could total up to US$30 million, Altius will be entitled to 3% gross revenue royalties on a portfolio of renewable wind energy
projects under development by TGE. This represents the first step in a planned strategic transition to renewable energy
royalty revenue as thermal coal royalty revenue is phased out over the next 10 years.
As announced April 17, 2019, Altius now expects full year royalty revenue of $77 -$81 million, compared to the $67 -$72
million original guidance. This compares with full year revenue in 2018 of $67 milion . This revision considered the strong
first quarter results, increased ownership of L IORC and an improved dividend ratio payout outlook, as well as increased
base metal and iron ore prices relative to the beginning of the year.
The Corporation also advises that its board of directors has elected to increase its regular quarterly cash dividend to five
cents per common share payable to all shareholders of record at the close of business on June 6, 2019. The dividend is
expected to be paid on or about June 20, 2019. 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.
Ben Lewis, Altius CFO commented, “We are experiencing strong growth across our royalty portfolio. This growth is coming
increasingly from organic drivers as commodity prices that have improved from the 2016 cyclical bottom are directly
translating into higher unit revenues, while also motivating several of our royalty counterparties to increase production
Date:
Ticker Symbol:
7-May 2019
ALS.TSX
Civic Address:
Altius Minerals Corporation
Suite 202, 66 Kenmount Road
St. John’s, NL, A1B 3V7, CANADA
Website: www.altiusminerals.com
Toll Free: 1.877.576.2209
Fax: 709.576.3441
e-mail: [email protected]
Mailing Address:
Altius Minerals Corporation
P.O. Box 8263 Stn “A”
St. John’s, NL, A1B 3N4, CANADA
volumes and invest in new mines, expansions and extensions. This shift is allowing us to make a cyclical adjustment to our
capital allocation prioritization towards more aggressive debt repayment as well as the increased regular dividend that the
Altius board approved today in recognition of the underlying strength of our diversified portfolio of long-life royalties.”
Q1 2019 Financial Results Conference Call and Webcast Information:
A conference call will be held on Wednesday, May 8, 2019, starting at 9:00 a.m. ET to further discuss the quarter and
guidance for 2018. To participate in the conference call, use the following dial -in numbers, or join the webcast on -line as
detailed below.
Time: 9:00 a.m. ET on Wednesday, May 8, 2019
Dial-In Numbers: +1(647) 427-2311 local or +1-866-521-4909 toll-free
Pass code: None required, but provide title of call
Conference Title: Altius Q1 2019 quarterly results
Webcast URL: Altius Q1 2019 Financial Results Webcast
The call will be webcast and archived on the Corporation’s website for a limited time.
About Altius
Altius directly and indirectly holds diversified royalties and streams which generate revenue from 15 operating mines. These
producing royalties are located in Canada and Brazil and provide exposure to copper, zinc, nickel, cobalt, iron ore, potash,
thermal (electrical) and metallurgical coal. The portfolio also includes development stage royalties in copper and renewable
energy and numerous predevelopment stage royalties covering a wide spectrum of mineral commodities and jurisdictions.
Altius also holds a portfolio of junior equities that were generated from vending exploration projects to industry partners in
exchange for minority equity interests and new royalties. Altius has 42,861,796 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.
For further information, please contact Ben Lewis or Flora Wood at 1.877.576.2209 or [email protected].