Ecora Resources PLC announces half-year results

LONDON, UNITED KINGDOM / ACCESSWIRE / September 4, 2024 / Ecora Resources PLC (LSE/TSX:ECOR) announces its half year results for the six months ended June 30, 2024, which are available on the Group’s website at www.ecora-resources.com and on SEDAR at www.sedar.com.

Ecora is the leading royalty company focused on supporting the supply of industrial commodities essential to creating a sustainable future. The Group’s portfolio combines volume growth in 2024 and 2025 from its currently producing royalty portfolio with a substantial pipeline of high-quality development projects expected to deliver significant medium-term revenue growth.

Marc Bishop Lafleche, Chief Executive Officer of Ecora, commented:

“Our H1 2024 portfolio contribution increased 15% year-on-year, driven by a strong performance from Kestrel. The second half portfolio contribution is expected to be primarily driven by the Group’s other production royalties, including production volume growth at the Voisey’s Bay and Mantos Blancos mines. Thereafter, further production growth is expected at Voisey’s Bay as underground operations are ramped up to stable production levels.

“Capstone Copper’s updated feasibility study on the Santo Domingo project reaffirmed the project’s solid economics and its potential to operate in the lowest-cost quarter of the world’s copper mines. BHP’s decision to temporarily suspend operations of its Australian nickel division, including the construction of West Musgrave, given the current weakness in the nickel market, was disappointing, but we remain confident in the project’s potential as a low-cost producer of nickel and copper.

“We have seen a strong increase in opportunities to further grow our portfolio. We continue to evaluate it against our established investment criteria and capital allocation priority to maintain a strong balance sheet.”

Financial highlights:

• Total portfolio contribution in H1 2024 of US$51.3 million (H1 2023: US$44.5 million) with royalty and metal flow revenues in H1 2024 of US$49.5 million (H1 2023: US$42.7 million)

• Adjusted earnings per share in H1 2024 of 10.38c (H1 2023: 9.06c)

• Profit before tax in the first half of 2024 of USD 17.9 million (first half of 2023: loss of USD 10.2 million)

• Net debt as of June 30, 2024 of $86.0 million (December 31, 2023: $74.6 million), representing a leverage ratio of 1.43x

• The Group has amended and extended its $150 million revolving credit facility to provide more favourable terms and flexibility

• Half-year dividend of 1.70 cents per share, representing 33% of free cash flow and at the upper end of our stated payout range of 25-35%, payable in January 2025.

• Proceeds of CA$11.1 million ($8.1 million) from the sale of shares in Labrador Iron Ore Royalty Corporation (“LIORC”), representing a total return on capital of ~110% (including dividends), with proceeds to be applied to the Group’s share buyback program in Q2 2024.

Portfolio highlights:

• Strong performance from Kestrel steel coal royalties, which delivered volumes from the private royalty sector in the first half of the year that were at the upper end of the full year volume guidance; no significant volumes expected in the second half of 2024

• During the first half of the year, four shipments of cobalt were received from the Voisey’s Bay stream (each shipment comprising 20 tonnes, of which 70% is attributable to the Group). As the construction phase of the Voisey’s Bay Mine Expansion Project nears completion, production volumes are expected to increase, with between 8 and 12 shipments of cobalt expected in the second half of 2024.

• Annual growth in production volume is expected for the operations underlying the Group’s license portfolio in 2024 and up to 2025

Events after the end of the period

• On 1 July, the Group announced the acquisition of a 0.85% gross revenue royalty on the Phalaborwa Rare Earth Project located in South Africa and operated by Rainbow Rare Earths Ltd (“Rainbow”) for a cash consideration of $8.5 million.

• On July 11, BHP announced that it would temporarily suspend construction of the West Musgrave nickel-copper project in October 2024. The decision will be reviewed by February 2027.

• On July 31, Capstone Copper Corp. (“Capstone”) released an updated feasibility study for the Santo Domingo Project, which reaffirmed the Project’s solid economics as a low-cost operation with expected cash costs of $0.33 per payable pound of copper over the 19-year mine life.

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https://www.rns-pdf.londonstockexchange.com/rns/7909C_1-2024-9-3.pdf

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SOURCE: Ecora Resources PLC

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