Labrador Iron Ore Royalty Corporation - Results for the Third
Labrador Iron Ore Royalty Corporation - Results for the Third
Quarter Ended September 30, 2017
TORONTO
,
Nov. 6, 2017
/CNW/ - Labrador Iron Ore Royalty Corporation ("LIORC", TSX: LIF) announced today its operation and cash
flow results for the third quarter ended
September 30, 2017
.
Royalty revenue for the third quarter of 2017 amounted to
$39.8 million
as compared to
$27.9 million
for the third quarter of 2016. LIORC
received a dividend from Iron Ore Company of
Canada
("IOC") in the third quarter of 2017 in the amount of
$32.2 million
or
$0.50
per share.
Equity earnings from IOC amounted to
$21.2 million
or
$0.33
per share in the third quarter of 2017 as compared to
$7.7 million
or
$0.12
per
share in the third quarter of 2016. Net income was
$43.8 million
or
$0.69
per share for the third quarter of 2017 compared to
$21.2 million
or
$0.33
per share for the same period in 2016. Cash flow from operations for the third quarter was
$53.6 million
or
$0.84
per share as compared
to
$15.2 million
or
$0.24
per share for the same period in 2016.
The cash flow from operations, equity earnings and net income for the third quarter of 2017 were higher than the third quarter of 2016, mainly due
to improved prices for concentrate and pellets and also due to increased sales tonnages. As reported by Bloomberg, the benchmark iron ore price
of 62% Fe CFR China averaged
US$71
per tonne in the third quarter of 2017 and reached a high of
US$80
in August. The comparable average
price in the third quarter of 2016 was
US$58
per tonne. Total iron ore sales tonnage – pellets plus concentrate for sale ("CFS") of 5.0 million
tonnes was 8% higher in the third quarter of 2017 compared to the same period in 2016, driven largely by pellet tonnage sales being 14% higher
than in the same period in 2016. The CFS sales tonnage in the third quarter of 2017 was slightly higher (plus 2%) than in the third quarter of 2016.
LIORC's results for the three months and nine months ended
September 30
are summarized below:
(in millions except per share information)
3 Months
Ended
Sept 30,
2017
3 Months
Ended
Sept 30,
2016
9 Months
Ended
Sept 30,
2017
9 Months
Ended
Sept 30,
2016
(Unaudited)
Revenue
$40.4
$28.4
$118.0
$76.5
Cash flow from operations
$53.6
$15.2
$127.4
$35.2
Operating cash flow per share
$0.84
$0.24
$1.99
$0.55
Net income
$43.8
$21.2
$118.9
$40.4
Net income per share
$0.69
$0.33
$1.86
$0.63
Iron Ore Company of Canada Operations
Production
Total concentrate production in the third quarter of 2017 of 5.7 million tonnes was 8% higher than the third quarter of 2016 and was 16% higher
than the second quarter of 2017. The record concentrate production in the third quarter of 2017 was due to a higher weight yield and an increase
of ground tonnes resulting from improved asset reliability.
The increased concentrate production in the third quarter enabled improved production tonnages for both pellets and CFS. Pellet production in the
third quarter of 2017 was 8% higher than the third quarter of 2016 and 24% higher than the second quarter of 2017. All six pellet lines operated in
the third quarter of 2017 as planned, whereas in the second quarter of 2017 the No. 2 pellet line was down for the scheduled refurbishment of the
induration machine. CFS production was 9% higher in the third quarter of 2017 than in the third quarter of 2016 and 12% higher than in the
second quarter of 2017. Pellet production in the third quarter was again favoured by the strong demand and margins.
Sales as Reported for the LIORC Royalty
Third quarter 2017 total iron ore tonnage sold by IOC (CFS plus pellets) of 5.0 million tonnes was 8% above the total sales tonnage in the third
quarter 2016 and 24% improved over the second quarter of 2017. In the third quarter of 2017, the pellet sales tonnage was 14% higher and CFS
sales tonnage was 39% higher than the second quarter of 2017. The higher CFS sales were largely due to improved concentrate production,
referred to above. Continued strong pellet demand and premiums supported maximizing pellet production and sales. While tonnage sales of both
CFS and pellets improved in the third quarter as compared to previous quarters, port loading and therefore sales tonnages, were constrained by
maintenance over a 34-day period in July and August on the dumper for the rail wagons that transport the iron ore products to the port at Sept
Isles. As a result of the constraint in unloading the rail wagons and the inventory of CFS at the Carol Lake mine site was unusually high at the end
of the third quarter at some 0.6 million tonnes over plan.
The benchmark price for 62% Fe CFR China was 22% higher in the third quarter of 2017 as compared to the third quarter of 2016 and pellet
premiums were also much improved. The Canadian dollar was 4% stronger in the third quarter of 2017 as compared to the third quarter of 2016.
As a result of the stronger iron ore prices and pellet premiums, and net of the stronger Canadian dollar, the royalty revenue for LIORC in the third
quarter of 2017 was 42% higher than the revenue in last year's third quarter.
A summary of IOC's sales for calculating the royalty to LIORC in millions of tonnes is as follows:
3 Months
3 Months
9 Months
9 Months
Year
Ended
Sept 30,
2017
Ended
Sept 30,
2016
Ended
Sept 30,
2017
Ended
Sept 30,
2016
Ended
Dec. 31,
2016
Pellets
2.78
2.44
7.70
6.98
10.06
Concentrates
(1)
2.23
2.18
6.01
6.38
8.17
Total
(2)
5.00
4.62
13.71
13.36
18.22
(1)
Excludes third party ore sales
(2)
Totals may not add up due to rounding
Outlook
Following a strong third quarter in 2017, IOC is expecting good production and sales tonnages in the fourth quarter of 2017. The refurbishment of
the induration machine for the No. 5 pellet line commenced in late
September 2017
as planned. The No. 5 pellet line is expected to be offline for
approximately nine weeks.
Rio Tinto, in its release of production results for the third quarter, maintained the IOC production guidance for 2017 of 11.4 to 12.4 million tonnes
of iron ore pellets and concentrates for their 58.72% interest in IOC, which is total saleable production of 19.4 to 21.1 million tonnes on a 100%
basis. Achieving the low end of the guidance would be a 6% improvement over the saleable production in 2016 of 18.2 million tonnes.
The 62% Fe CFR China benchmark iron ore price rose from approximately
US$64
per tonne at the beginning of the third quarter to a peak of
US$80
per tonne in August and declined back to approximately
US$62
per tonne at the end of the quarter. The increase was supported by
improved margins for Chinese steel mills and the decline was precipitated by concerns on the timing of large Chinese infrastructure projects and
reduced steel production in
China
to meet environmental targets. Forecasts for the 62% Fe CFR China seaborne price vary considerably but tend
to forecast prices trending lower for the balance of 2017 and the longer term, driven by increased supply, notably from
Brazil
. However, premiums
for the higher grade iron ore concentrates and pellets, such as produced by IOC, have been exceptionally strong and the value-in-use premiums
may continue to be supported by the Chinese efforts to reduce pollution.
In recent weeks the Canadian dollar has somewhat weakened, reflecting concern over the NAFTA negotiations and the outlook for interest rate
increases by the Bank of
Canada
, and iron ore prices have weakened. These factors are offsetting but could affect LIORC's results.
The IOC employees and management have had success in their efforts to increase production and reduce unit operating costs. We note the strong
third quarter performance, and we expect strong fourth quarter sales as the inventories at Carol Lake are reduced to more normal levels.
The LIORC cash balance at
September 30, 2017
stood at
$64.9 million
with LIORC dividends payable on October 25, 2017 of
$64.0 million
.
The net royalty from IOC was paid on the same date, maintaining the Corporation's strong cash balance. As noted in our second quarter results,
with a strong cash balance, iron ore prices at about
US$60
per tonne, the exchange rate at present, and the expected increased production at
IOC, LIORC is in a good position to maintain the regular dividend.
Respectfully submitted on behalf of the Directors of Labrador Iron Ore Royalty Corporation,
William H. McNeil
President and Chief Executive Officer
November 6, 2017
Management's Discussion and Analysis
The following discussion and analysis should be read in conjunction with the Management's Discussion and Analysis section of the Corporation's
2016 Annual Report and the financial statements and notes contained therein. The Corporation's revenues are entirely dependent on the
operations of IOC as its principal assets relate to the operations of IOC and its principal source of revenue is the 7% royalty it receives on all sales
of iron ore products by IOC. In addition to the volume of iron ore sold, the Corporation's royalty revenue is affected by the price of iron ore and
the Canadian – U.S. dollar exchange rate.
The first quarter sales of IOC are traditionally adversely affected by the closing of the St. Lawrence Seaway and general winter operating
conditions and are usually 15% – 20% of the annual volume, with the balance spread fairly evenly throughout the other three quarters. Because of
the size of individual shipments, some quarters may be affected by the timing of the loading of ships that can be delayed from one quarter to the
next.
Royalty revenue for the third quarter of 2017 amounted to
$39.8 million
as compared to
$27.9 million
for the third quarter of 2016. The
shareholders' cash flow from operations for the third quarter was
$53.6 million
or
$0.84
per share as compared to
$15.2 million
or
$0.24
per
share for the same period in 2016. LIORC received a dividend from IOC in the third quarter of 2017 in the amount of
$32.2 million
or
$0.50
per
share. Equity earnings from IOC amounted to
$21.2 million
or
$0.33
per share in the third quarter of 2017 as compared to
$7.7 million
or
$0.12
per share in the third quarter of 2016. Net income was
$43.8 million
or
$0.69
per share for the third quarter of 2017 compared to
$21.2 million
or
$0.33
per share for the same period in 2016.
The cash flow from operations, equity earnings and net income for the third quarter of 2017 were higher than the third quarter of 2016, mainly due
to improved prices for concentrate and pellets and also due to increased sales tonnages. As reported by Bloomberg, the benchmark iron ore price
of 62% Fe CFR China averaged
US$71
per tonne in the third quarter of 2017 and reached a high of
US$80
in August. The comparable average
price in the third quarter of 2016 was
US$58
per tonne. Total iron ore sales tonnage – pellets plus CFS of 5.0 million tonnes was 8% higher in the
third quarter of 2017 compared to the same period in 2016, driven largely by pellet tonnage sales being 14% higher than in the same period in
2016. The CFS sales tonnage in the third quarter of 2017 was slightly higher (plus 2%) than in the third quarter of 2016.
Total concentrate production in the third quarter of 2017 of 5.7 million tonnes was 8% higher than the third quarter of 2016 and was 16% higher
than the second quarter of 2017. The record concentrate production in the third quarter of 2017 was due to a higher weight yield and an increase
of ground tonnes resulting from improved asset reliability.
The increased concentrate production in the third quarter enabled improved production tonnages for both pellets and CFS. Pellet production in the
third quarter of 2017 was 8% higher than the third quarter of 2016 and 24% higher than the second quarter of 2017. All six pellet lines operated in
the third quarter of 2017 as planned, whereas in the second quarter of 2017 the No. 2 pellet line was down for the scheduled refurbishment of the
induration machine. CFS production was 9% higher in the third quarter of 2017 than in the third quarter of 2016 and 12% higher than in the
second quarter of 2017. Pellet production in the third quarter was again favoured by the strong demand and margins.
Third quarter 2017 total iron ore tonnage sold by IOC (CFS plus pellets) of 5.0 million tonnes was 8% above the total sales tonnage in the third
quarter 2016 and 24% improved over the second quarter of 2017. In the third quarter of 2017, the pellet sales tonnage was 14% higher and CFS
sales tonnage was 39% higher than the second quarter of 2017. The higher CFS sales were largely due to improved concentrate production,
referred to above. Continued strong pellet demand and premiums supported maximizing pellet production and sales. While tonnage sales of both
CFS and pellets improved in the third quarter as compared to previous quarters, port loading and therefore sales tonnages, were constrained by
maintenance over a 34-day period in July and August on the dumper for the rail wagons that transport the iron ore products to the port at Sept
Isles. As a result of the constraint in unloading the rail wagons, the inventory of CFS at the Carol Lake mine site was unusually high at the end of
the third quarter at some 0.6 million tonnes over plan.
The benchmark price for 62% Fe CFR China was 22% higher in the third quarter of 2017 as compared to the third quarter of 2016 and pellet
premiums were also much improved. The Canadian dollar was 4% stronger in the third quarter of 2017 as compared to the third quarter of 2016.
As a result of the stronger iron ore prices and pellet premiums, and net of the stronger Canadian dollar, the royalty revenue for LIORC in the third
quarter of 2017 was 42% higher than the revenue in last year's third quarter.
Results for the nine months were affected by the same factors as affected the three month period. Administrative expenses for the nine months
include a non-cash foreign exchange loss of
$0.3 million
on the conversion of the dividend received from IOC in
December 2016
and the 2016
bonuses awarded by the Compensation Committee to the executive officers totaling
$0.1 million
. Amortization expense for royalty and commission
interests increased
$1.2 million
for the nine months due to an increased amortization rate reflecting lower estimated total mineral resources over the
prior year.
The following table sets out quarterly revenue, net income and cash flow data for 2017, 2016 and 2015.
Revenue
Net
Income
Net
Income
per Share
Cash Flow
Cash Flow
from
Operations
per Share
Adjusted
Cash Flow
per Share
(1)
Dividends
Declared per
Share
(in millions except per share information)
2017
First Quarter
$43.4
$42.9
$0.67
$28.2
(2)
$0.44
(2)
$0.53
(2)
$0.50
Second Quarter
$34.2
$32.3
$0.50
$45.6
(3)
$0.71
(3)
$0.53
(3)
$0.60
Third Quarter
$40.4
$43.8
$0.69
$53.6
(4)
$0.84
(4)
$0.85
(4)
$1.00
2016
First Quarter
$22.3
$11.0
$0.17
$12.5
$0.19
$0.19
$0.25
Second Quarter
$25.8
$8.3
$0.13
$7.6
$0.12
$0.22
$0.25
Third Quarter
$28.4
$21.2
$0.33
$15.2
$0.24
$0.24
$0.25
Fourth Quarter
$38.6
$37.7
$0.59
$28.3
(5)
$0.44
(5)
$0.57
(5)
$0.25
2015
First Quarter
$23.7
$10.0
$0.16
$15.2
$0.24
$0.20
$0.25
Second Quarter
$24.0
$15.4
$0.24
$12.5
$0.20
$0.21
$0.25
Third Quarter
$32.0
$19.0
$0.30
$12.2
$0.19
$0.28
$0.25
Fourth Quarter
$22.0
$10.3
$0.15
$20.0
$0.31
$0.19
$0.25
(1)
"Adjusted cash flow" (see below)
(2)
Includes $10.0 million IOC dividend.
(3)
Includes $15.3 million IOC dividend.
(4)
Includes $32.2 million IOC dividend.
(5)
Includes $15.1 million IOC dividend.
Standardized Cash Flow and Adjusted Cash Flow
For the Corporation, standardized cash flow is the same as cash flow from operating activities as recorded in the Corporation's consolidated
statements of cash flow as the Corporation does not incur capital expenditures or have any restrictions on dividends. Standardized cash flow per
share was
$0.84
for the quarter (2016 -
$0.24
). Cumulative standardized cash flow from inception of the Corporation is
$24.53
per share and
total cash distributions since inception is
$24.04
per share, for a payout ratio of 98%.
The Corporation also reports "Adjusted cash flow" which is defined as cash flow from operating activities after adjustments for changes in amounts
receivable, accounts payable and income taxes recoverable and payable. It is not a recognized measure under International Financial Reporting
Standards ('IFRS"). The Directors believe that adjusted cash flow is a useful analytical measure as it better reflects cash available for dividends to
shareholders.
The following reconciles standardized cash flow from operating activities to adjusted cash flow (in '000's).
3 Months
Ended
Sept 30, 2017
3 Months
Ended
Sept 30, 2016
9 Months
Ended
Sept 30, 2017
9 Months
Ended
Sept 30, 2016
Standardized cash flow from operating activities
$53,640
$15,159
$127,398
$35,211
Excluding: changes in amounts receivable, accounts payable and income
taxes payable
798
370
(5,276)
6,471
Adjusted cash flow
$54,438
$15,529
$122,122
$41,682
Adjusted cash flow per share
$0.85
$0.24
$1.91
$0.65
Liquidity and Capital Resources
The Corporation had
$64.9 million
in cash as at
September 30, 2017
(
December 31, 2016
-
$23.9 million
) with total current assets of
$102.4
million
(
December 31, 2016
-
$62.9 million
). The Corporation had working capital of
$26.6 million
as at
September 30, 2017
(
December 31,
2016
-
$38.8 million
). The Corporation's operating cash flow for the quarter was
$53.6 million
and the dividend paid during the quarter was
$38.4
million
, resulting in cash balances increasing by
$15.2 million
during the third quarter of 2017.
Cash balances consist of deposits in Canadian dollars with Canadian chartered banks. Amounts receivable primarily consist of royalty payments
from IOC. Royalty payments are received in U.S. dollars and converted to Canadian dollars on receipt, usually 25 days after the quarter end. The
Corporation does not normally attempt to hedge this short-term foreign currency exposure.
Operating cash flow of the Corporation is sourced entirely from IOC through the Corporation's 7% royalty,
10 cents
commission per tonne and
dividends from its 15.10% equity interest in IOC. The Corporation intends to pay cash dividends of the net income derived from IOC to the
maximum extent possible, subject to the maintenance of appropriate levels of working capital.
The Corporation has a
$50 million
revolving credit facility with a term ending
September 18, 2019
with provision for annual one-year extensions.
No amount is currently drawn under this facility (2016 – nil) leaving
$50.0 million
available to provide for any capital required by IOC or
requirements of the Corporation.
Outlook
Following a strong third quarter in 2017, IOC is expecting good production and sales tonnages in the fourth quarter of 2017. The refurbishment of
the induration machine for the No. 5 pellet line commenced in late
September 2017
as planned. The No. 5 pellet line is expected to be offline for
approximately nine weeks.
Rio Tinto, in its release of production results for the third quarter, maintained the IOC production guidance for 2017 of 11.4 to 12.4 million tonnes
of iron ore pellets and concentrates for their 58.72% interest in IOC, which is total saleable production of 19.4 to 21.1 million tonnes on a 100%
basis. Achieving the low end of the guidance would be a 6% improvement over the saleable production in 2016 of 18.2 million tonnes.
The 62% Fe CFR China benchmark iron ore price rose from approximately
US$64
per tonne at the beginning of the third quarter to a peak of
US$80
per tonne in August and declined back to approximately
US$62
per tonne at the end of the quarter. The increase was supported by
improved margins for Chinese steel mills and the decline was precipitated by concerns on the timing of large Chinese infrastructure projects and
reduced steel production in
China
to meet environmental targets. Forecasts for the 62% Fe CFR China seaborne price vary considerably but tend
to forecast prices trending lower for the balance of 2017 and the longer term, driven by increased supply, notably from
Brazil
. However, premiums
for the higher grade iron ore concentrates and pellets, such as produced by IOC, have been exceptionally strong and the value-in-use premiums
may continue to be supported by the Chinese efforts to reduce pollution.
In recent weeks the Canadian dollar has somewhat weakened, reflecting concern over the NAFTA negotiations and the outlook for interest rate
increases by the Bank of
Canada
, and iron ore prices have weakened. These factors are offsetting but could affect LIORC's results.
The IOC employees and management have had success in their efforts to increase production and reduce unit operating costs. We note the strong
third quarter performance, and we expect strong fourth quarter sales as the inventories at Carol Lake are reduced to more normal levels.
The LIORC cash balance at
September 30, 2017
stood at
$64.9 million
with LIORC dividends payable on October 25, 2017 of
$64.0 million
.
The net royalty from IOC was paid on the same date, maintaining the Corporation's strong cash balance. As noted in our second quarter results,
with a strong cash balance, iron ore prices at about
US$60
per tonne, the exchange rate at present, and the expected increased production at
IOC, LIORC is in a good position to maintain the regular dividend.
William H. McNeil
President and Chief Executive Officer
Toronto, Ontario
November 6, 2017
Forward-Looking Statements
This report may contain "forward-looking" statements that involve risks, uncertainties and other factors that may cause the actual results,
performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such
forward-looking statements. Words such as "may", "will", "expect", "believe", "plan", "intend", "should", "would", "anticipate" and other similar
terminology are intended to identify forward-looking statements. These statements reflect current assumptions and expectations regarding future
events and operating performance as of the date of this report. Forward-looking statements involve significant risks and uncertainties, should not
be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be
achieved. A number of factors could cause actual results to vary significantly, including iron ore price and volume volatility, exchange rates, the
performance of IOC, market conditions in the steel industry, mining risks and insurance, relationships with aboriginal groups, changes affecting
IOC's customers, competition from other iron ore producers, estimates of reserves and resources and government regulation and taxation. A
discussion of these factors is contained in LIORC's annual information form dated
March 2, 2017
under the heading, "Risk Factors". Although the
forward-looking statements contained in this report are based upon what management of LIORC believes are reasonable assumptions, LIORC
cannot assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as
of the date of this report and LIORC assumes no obligation, except as required by law, to update any forward-looking statements to reflect new
events or circumstances. This report should be viewed in conjunction with LIORC's other publicly available filings, copies of which can be
obtained electronically on SEDAR at
www.sedar.com
.
Notice:
The following unaudited interim condensed consolidated financial statements of the Corporation have been prepared by and are the responsibility
of the Corporation's management. The Corporation's independent auditor has not reviewed these interim financial statements.
LABRADOR IRON ORE ROYALTY CORPORATION
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS
As at
September 30,
December 31,
(in thousands of Canadian dollars)
2017
2016
(Unaudited)
Assets
Current Assets
Cash
$
64,935
$
23,937
Amounts receivable
37,475
38,487
Income taxes recoverable
-
490
Total Current Assets
102,410
62,914
Non-Current Assets
Iron Ore Company of Canada ("IOC"),
royalty and commission interests
260,589
265,384
Investment in IOC
408,613
408,680
Total Non-Current Assets
669,202
674,064
Total Assets
$
771,612
$
736,978
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable
$
7,677
$
8,073
Dividend payable
64,000
16,000
Taxes Payable
4,170
-
Total Current Liabilities
75,847
24,073
Non-Current Liabilities
Deferred income taxes
127,660
129,060
Total Liabilities
203,507
153,133
Shareholders' Equity
Share capital
317,708
317,708
Retained earnings
261,136
276,588
Accumulated other comprehensive loss
(10,739)
(10,451)
568,105
583,845
Total Liabilities and Shareholders' Equity
$
771,612
$
736,978
Approved by the Directors,
William H. McNeil
Patricia M. Volker
Director
Director
LABRADOR IRON ORE ROYALTY CORPORATION
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Three Months Ended
September 30,
(in thousands of Canadian dollars except for per share information)
2017
2016
(Unaudited)
Revenue
IOC royalties
$
39,810
$
27,939
IOC commissions
493
455
Interest and other income
110
32
40,413
28,426
Expenses
Newfoundland royalty taxes
7,962
5,588
Amortization of royalty and commission interests
1,824
1,199
Administrative expenses
662
675
10,448
7,462
Income before equity earnings and income taxes
29,965
20,964
Equity earnings in IOC
21,150
7,670
Income before income taxes
51,115
28,634
Provision for income taxes
Current
9,519
6,633
Deferred
(2,183)
834
7,336
7,467
Net income for the period
43,779
21,167
Other comprehensive loss
Share of other comprehensive loss of IOC that will not be
reclassified subsequently to profit or loss
(net of income taxes of 2017 - $17; 2016 - $54)
(96)
(306)
Comprehensive income for the period
$
43,683
$
20,861
Net income per share
$
0.69
$
0.33
LABRADOR IRON ORE ROYALTY CORPORATION
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Nine Months Ended
September 30,
(in thousands of Canadian dollars except for per share information)
2017
2016
(Unaudited)
Revenue
IOC royalties
$
116,400
$
75,067
IOC commissions
1,350
1,315
Interest and other income
252
112
118,002
76,494
Expenses
Newfoundland royalty taxes
23,280
15,013
Amortization of royalty and commission interests
4,795
3,608
Administrative expenses
2,356
2,012
30,431
20,633
Income before equity earnings and income taxes
87,571
55,861
Equity earnings in IOC
57,713
6,694
Income before income taxes
145,284
62,555
Provision for income taxes
Current
27,685
17,787
Deferred
(1,349)
4,346
26,336
22,133
Net income for the period
118,948
40,422
Other comprehensive loss
Share of other comprehensive loss of IOC that will not be
reclassified subsequently to profit or loss (net of income taxes
of 2017 - $51; 2016 - $206)
(288)
(734)
Comprehensive income for the period
$
118,660
$
39,688
Net income per share
$
1.86
$
0.63
LABRADOR IRON ORE ROYALTY CORPORATION
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended
September 30,
(in thousands of Canadian dollars except for per share information)
2017
2016
(Unaudited)
Net inflow (outflow) of cash related
to the following activities
Operating
Net income for the period
$
118,948
$
40,422
Items not affecting cash:
Equity earnings in IOC
(57,713)
(6,694)
Current income taxes
27,685
17,787
Deferred income taxes
(1,349)
4,346
Amortization of royalty and commission interests
4,795
3,608
Common share dividend from IOC
57,441
-
Change in amounts receivable
1,012
(7,073)
Change in accounts payable
(396)
1,286
Income taxes paid
(23,025)
(18,471)
Cash flow from operating activities
127,398
35,211
Financing
Dividends paid to shareholders
(86,400)
(48,000)
Cash flow used in financing activities
(86,400)
(48,000)
Increase (decrease) in cash, during the period
40,998
(12,789)
Cash, beginning of period
23,937
24,463
Cash, end of period
$
64,935
$
11,674
LABRADOR IRON ORE ROYALTY CORPORATION
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Accumulated
other
Share
Retained
comprehensive
(in thousands of Canadian dollars except for per share information)
capital
earnings
loss
Total
Balance as at December 31, 2015
$
317,708
$
262,415
$
(11,150)
$
568,973
Net income for the period
-
40,423
-
40,423
Dividends declared to shareholders
-
(48,000)
-
(48,000)
Share of other comprehensive loss from investment in IOC (net of taxes)
-
-
(734)
(734)
Balance as at September 30, 2016
$
317,708
$
254,838
$
(11,884)
$
560,662
Balance as at December 31, 2016
$
317,708
$
276,588
$
(10,451)
$
583,845
Net income for the period
-
118,948
-
118,948
Dividends declared to shareholders
-
(134,400)
-
(134,400)
Share of other comprehensive loss from investment in IOC (net of taxes)
-
-
(288)
(288)
Balance as at September 30, 2017
$
317,708
$
261,136
$
(10,739)
$
568,105
The complete consolidated financial statements for the third quarter ended
September 30, 2017
, including the notes thereto, are posted on
sedar.com
and
labradorironore.com
.
SOURCE
Labrador Iron Ore Royalty Corporation
View original content: http://www.newswire.ca/en/releases/archive/November2017/06/c1036.html
%SEDAR: 00030172E
For further information:
please contact: William H. McNeil, President & Chief Executive Officer, (416) 863-7133
CO: Labrador Iron Ore Royalty Corporation
CNW 17:59e 06-NOV-17