Q4 2024 Elemental Altus Royalties Corp Earnings Call
Speaker Change: So, I think everyone is just signing in at the moment.
Speaker Change: Thank you for coming to this. I can see we've got people dining in from...
Speaker Change: Australia, Europe , US and Canada, so well presented and really appreciate you all making a time. This is Elemental Altus' Q4 Fully Air 2024 results presentation and with me today
Speaker Change: I have myself and it's CEO Fred Bell and I'll see you for days, Baker.
Speaker Change: and I will do a quick intro to the company and a few of the key key points and then really hand over to Dave for the meet of the presentation.
Speaker Change: So that goes over 2024 and what we're looking forward to in 2025. I think some of the key areas in 2024 was the Alpha Stream acquisition which increased our ownership in three producing royalties.
Speaker Change: in Q4 and that was Bonacro Banner after an SKO as well as a portfolio of exploration and development assets across Australia.
Speaker Change: We also have the material news from our cornerstone color window royalty of the expansion project and color window expansion project that is underway.
Speaker Change: and expecting to be permitted this year with construction going into operations in 2026 and that would be for a 50% throughput and approximately 30% increase in gold production at one of our two cornerstone altes taking in from mid-2026.
We announce the acquisition of the Mac Tom Royalty.
Speaker Change: which is a tungsten royalty in the economy and I think really in December we had the really positive announcement of US and Canadian government funding.
Speaker Change: to fast-track that project through feasibility study in 2026 and final investment decision in 2028.
Speaker Change: and that came after our position, so pleased to see that project being pushed forward.
Speaker Change: Very fast we had both Raymond James and National Bank initiating coverage on us during the course of 2024 and we also had RBC joining our credit facility and taking that fully committed facility up to $50 million US dollars.
Speaker Change: and so we ended the year with a net cash position, which has been the first time for a number of years having repaid $27 million over the course of the year and coming into the beginning of this year with fully repaid that absolutely.
Speaker Change: So, looking forward to 2025, we have our US producing royalty, Karali Sud, and this is part of Allied Sadiota operations.
Speaker Change: that we sold to them approximately 18 months ago and been very impressed at how they fast-tracked that into production with a very material Q4 last year and coming into Q1 this year we'll start to get our first Royalty revenue.
Speaker Change: We are forecasting record revenue and also with that leverage, record free cashflow for 2025. And that is in addition to what we have on the balance sheet and what we have in available cash pool we can go forward.
We also exclude from that Revenue Guidance.
Speaker Change: about 13 to 15 million US dollars that we expect to get in milestone payments over the course of 2025 with the largest payment.
Speaker Change: to this month about 10 million US dollars. And so that is going to further bolster our balance sheet and put us in a very strong position. The strongest decision the company has ever been financially to continue to acquire opportunistically.
Speaker Change: and also look at poor projects and look forward to the news as well from Colwender on that expansion project added progress is over the course of the year.
Speaker Change: So just two slides really, two more slides here before we get into the guts of the financials.
Speaker Change: This is the Alpha Stream portfolio we acquired in October . I think the key thing here is that this was going to add approximately at the time. I think we said about six million in revenue forecast, obviously, with spot gold price where it is every every week, every month.
Speaker Change: The gold is where it is, we get a material uplift to that revenue from this portfolio and we've also had the updates from Northern Star at the Calgulliots.
Speaker Change: around the Hercules deposit there where I think we're expecting an update from that in H1 of this year to give us what we think should actually be a pretty material resource and project there that they'll be feeding into their mind.
Speaker Change: The second slide we've got here, full of finances, is on Crowley Serden. This is our formerly called Deba Project Renames by Allah. It's Crowley Serden.
Speaker Change: really encouraged to see them kickoff production in Q4 and they had a very strong Q4 about 49,000 ounces produced just from our royalty area in that quarter. We have a 3% royalty on it for the first.
Speaker Change: a bit over 200,000 ounces of production, and then if that's down to an on-cat 2% royalty, we also have milestone payments that come following commercial production and then production milestones, and we anticipate some of those to be hit in the course of 2025.
Speaker Change: So although production was there in Q4, the actual first sales kept selling to Q1 so this will be our first quarter of revenue coming from Carali said and we're going to have the benefit of it going forwards now.
Speaker Change: So with that, those two updates, I'll hand over the days to run through the rest of the presentation.
Dave: Thanks Fred. Yeah, so again a strong quarter, strong quarter and a strong year, we've already pre-released.
Dave: GEOs and Revenue, so that was in line with guidance of GIOs revenue of US $21.6.
Dave: I know we say this a lot, but adjusted revenue allows us to proportionally consolidate up the casaron as royalty, including casaron as revenue, so you have 21.6 million dollars per year, that's the eighth consecutive year of record revenue.
Dave: as a result of our streamlining costs monetization of the exploration business.
Dave: and obviously an increasing revenue profile. That's led to adjusted EBITDA for the quarter of $4.8 million, that's a record and that's up 72% on this time last year. We're also seeing that flow into cash flow from operations so again that's the cash flows from our operating business plus dividends from cash earners of $3.3 million US dollars and that's up 54% on this time last year.
Dave: So we're really seeing the benefits of stable cost space and then that full exposure to gold prices under great assets.
Dave: and the future of the future looks bright. So we previously announced GEO guidance for this year of a record 11.6 to 13.2 thousand ounces. That's a 38% increase in GEOs alone on 2024.
Dave: got prices changed a lot since we put out our guidance.
Dave: So when we were using which looks like now a very conservative $2,600 gold price, that was going to lead to 2025 adjusted revenue of a record 30 to 34 million US dollars.
Dave: Obviously that's going to be quite a lot higher now for plugging in plus three three thousand dollar gold or more.
Dave: So, yes, at least at least that 50% year-on-year increase in adjust revenue based on guidance, potentially more if gold holds up. And then on top of that as Fred says, so not included in that revenue guidance is the $13 to $15 million expected from portfolio payments.
Dave: to the front of the year, where you are imminently expecting that $10 million US dollars from the Ming settlement that Fred talked to.
Dave: in terms of where we are. We are debt-free. We have $3 million on the facility at the end of the year. We pay that back and pay that down in February , which means we have the full $50 million facility available immediately for drawdown for new transactions and that with cash generation through the year means considerable.
Dave: amounts so we can spend without diluting our shareholders even a little.
Dave: Completing that alpha-fing transaction said Fred, and that just gives us that full exposure to gold prices on producing assets, and I tell you the pipeline has never been as busy as we are now exploring both the individual acquisition portfolios, and as we always say we're an unbeliever of consolidation in the royalty space.
Dave: As you know, our portfolio is really underpinned by two very high quality assets, operate by high
Dave: I think critically, and we've announced this before, that major expansion has been announced, so getting to 150,000 ounces of production.
Dave: We have this year's royalty company, I don't have to pay for any of that, so we've got that full.
Dave: are full exposure to increasing throughput and increasing ounces of US and Australian dollar gold prices. I think most encouragingly, even post-expansion, minelisers is still more than 10 years with significant potential to increase beyond that, it's a very homogenous whole body.
Dave: Castaronis, a little bit lighter than we thought in the period.
Dave: to some of the hydrogeological issues there in the FA5 pushback, impacted grades and recoveries.
Dave: but we're going to expect those those times to come through.
Later this year.
Dave: and also there was a small delay in concentrate, 20,000 tons of concentrate sales, obviously we were paid on sales not production, so we expect to see that picking up in Q1.
Dave: and encouraging the strong production guidance from the London in 2025 of 115 to 125,000 tons of copper.
Dave: So where really where does the growth come from? The key growth asset in 2025, as Fred said, is Coralie Sird, which we
Dave: those four nearly 40,000 ounces that were produced in Q4 last year, so they'll be reflected in Q1 sales, plus of course all the Q1 production as well, so we're expecting a significantly large bump in Q1.
Dave: from Caralli Sud and then obviously ongoing production and then the other real kicker is obviously the Alpha Stream acquisition.
Dave: So we didn't double our exposure to that 4.5% royalty over Bonacro and we get full exposure to both production, 90,000 ounces plus of production from Bonacro.
Dave: At obviously increasing gold prices, I think encouraging what we've seen from our slide is they said that they're expecting high grade materials over 2025 and 2026 because of the high quality stripping work that they've been doing.
Dave: Likewise, Wanyon has been an excellent performer and again looking forward to seeing record numbers out of Wanyon at the gold prices that we're seeing now.
Speaker Change: spoken to Bonacrow and Anne Caralli in terms of
Dave: The other asset, again, Ballerat, we also, we also double-barred exposure to as part of the outskis treatment transaction. I've been really happy with the new management team there really focus on getting cost down, increasing production, looking at some capital expenditure there to increase throughput.
Dave: So I think there's a real potential to grow there. And then yeah, it would highlight that we're expecting that 30% production at Carlewinde really land in 2026, so that's a real near-term catalyst for the company.
How does that translate into financials?
Dave: So revenue for the quarter and revenue for the year, a just revenue for the year, up 21%.
Dave: and that's really just a strong performance in Indian gold, called GEOS, flat for the year, but yeah, really expecting an uptick on that immediately and really weighted towards the first half of the year.
Dave: The leverage of this flat cost-based that we have with an increasing revenue profile, you really do see that incredible margin expansion, so looking at 72% increase on EBITDA, quarter on quarter, over 50% increase even EBITDA, and then we're seeing that reflected in operating cash flows there as well.
Dave: and some pretty remarkable growth of over 50% on the quarter, 42% on the year on a just operating cash flows and really would expect that trend to continue.
Dave: in terms of how that cash flow, that payment $1, pre-cash the fields up over the quarter.
Dave: As you saw, we reflect the revenue and capturing its dividends.
Dave: GNA, again, we had someone often in Q4 relating to the AGM and timing of some costs, expect that to be lower quarter and quarter, I have to pay a little worth of tax.
Dave: in a growing revenue business. We will have some working capital build up because the game we get, we report revenue on our crew basis but get paid in the following quarter.
Dave: and so that's the bridge there to $3 million of free cash flow for the quarter would also note that now that we're fully repaid on the...
Dave: on the credit facility is that that interest period will be ten new zero and the in the following quarters and you know we actually will have a net positive interest as well you know any cash in the bank.
Dave: So through the cash build-up, through the quarter itself, if you say start of the quarter with $6 million in cash.
Dave: Lamancha, followed their right anti-diolution right as part of the ounce of zinc transaction for 12.8 million dollar private placement, 12.7 up to cost.
Dave: and then what that allowed us to do was we paid $17 million of debt in the quarter. That left us with $3 million on the facility at the end of the year, as I said. That left us obviously there with the net cast position at the end of the quarter, with $5.4 million in the bank.
Dave: and then as Q1, first Q4 revenue started to come in, we were paid that last $3 million to leave a debt.
to leave a step-free.
Dave: in total revenues. That's just accounting treatment and equity accounting that we have to do for cast ironers. Obviously, the cash comes in the bank the same way. This is just the accounting standards, and then we back out the depletion and tax that we pay down there in Chile to get to an adjusted EBITDA number.
David Baker, Frederick Bell, Elemental Altus Royalties
Dave: Freda said, you know, material, expecting material, one of payments in the quarter. Key one there is the million dollars on 90 days after commercial production at Carly'shood. That has occurred. So, expecting that, imminently, the key one also there being nearly $10 million expected from that final settlement on, on, on me, which will have our total, total claim at the circuit, 13 million US dollars. We're also expecting that to plan $1.9 million by that.
of the cactus royalty.
Dave: We're also expecting Carlisod to hit 100,000 ounces of production this year so when that happens, if that happens, whether it happens this year or next, we $2 million in the bank.
Dave: and then we've obviously got that one and a half million dollars deferred.
Dave: to Cornish Metals for the tungsten portfolio. So, yes, 13.2 net proceeds on buybacks expected
Dave: Growth has been excellent in the portfolio, so absolutely record revenue.
Dave: for the quarterly flat CEOs, but again, expecting both GEO growth and then revenue growth into 2025.
Speaker Change: I think this slide will look very ranging over the next couple of quarters, where we'll see both the benefits of increasing GEOs and significant increase in gold price reflecting how size revenue growth.
Speaker Change: Likewise, we do get that EBITDA boost with a slight profile. As I said, there were a couple of one off-cloths in the quarter. I slightly reduced the EBITDA margin, but I'd expect that EBITDA margin to track higher, which is the way the trend is going into the 80% or higher EBITDA margin.
Speaker Change: As you say, we have reasonably flat costs and higher revenue, so expect this chart to improve over time as well.
Speaker Change: And as we see the operating cashflow plus our cashflow and dividends trending in the right direction. There's a $3.3 million of operating cashflow positive over the quarter, we expect that to trend higher as well.
Speaker Change: So in terms of the capital structure, we're backed by supported shareholders, most notably Lamarcha and Alpha Stream, but notably there's some shareholders in there that have been aware since our private days and extremely strongly, extremely supportive.
Speaker Change: Chef Rice recently performance has been strong so like I guess today we closed at 1.30, 1.39 so that's the market cap is nearly 250 million US dollars as I guess say we have $5 million in the bank. No debt so yeah you'd be there if I'm just shy of other $240 million.
Speaker Change: 4 analysts covering us now and yet very, very supportive, very thankful and supportive
Speaker Change: And on that note Fred, I might hand back to you just before we have any questions.
Fred: Sure, thank you for that, Dave. If you do have a question, feel free to type it into the Q&A or alternatively we can ask some questions on the call.
Fred: to round it off where the company is today. I think we've got peer-leading revenue growth in our space. Every year the company has had a record year in terms of revenue. And this year is going to be, I think, a standout year both based on cheers and where we are.
Fred: before we even get to the current gold rice and where that is.
Fred: We have two really high quality cornerstone assets, Carla Winder and Cassarone age with them.
Fred: at Carla Winda and with the first drilling at Casa Rene since that mine was built.
Fred: that is undertaken last year and again a bigger program this year on the London Mining so expecting to continue to see results growth there and we have growth both going through 2025 but also looking at 2026 based on operator.
Fred: Outlook, we're looking at a revenue growth continued over the next 24 months going forward.
Fred: We always make this point, but if you look at the history of the company, there has not been a year in which we have not added the portfolio and we have not made acquisitions.
Fred: but that has never been a year that we have been in a strongest financial position as we are today.
with a balance sheet that is...
Fred: I think for the first time in probably four or five years.
Fred: in a net cash position but also with the largest credit facility we have on drawn.
Fred: we're going to be generating record revenue. So, in a really strong position to deploy non-by-lootive capital, that is, you know, add to the portfolio, but not.
valued in our existing shoulders.
Fred: And a lot of those shareholders have been with us a number of years and incredibly supportive both through when we're a private company.
Fred: and through public company on both the other mental and the outer side and so very grateful for that and looking really to try and add as much value as we can over the course of this year and as we look at ourselves today I think we're currently trading on one of the other bright-to-revenue multiples in the junior space.
Fred: We're probably about half what the midter's trade-out and close to a third of what the major's trade-out. So I think that from where we are, we're very attractively valued and we've also got a really good platform for growth going forward.
Speaker Change: So with that, we might move on to the Q&A and then I'll let you take the detail.
Dave: Yeah, absolutely. So, first question there, Fred, is there any plans to increase training volumes?
Speaker Change: and then also, when was the last time management bought shares in the open market? I think to that point, both Fred and I bought shares in the market in December .
Speaker Change: I think this is all public filings on on-city. You know, I would know that it is increasingly challenging to buy shares. We are often blacked out whether that's due to financials or all material transactions. The note of Fred and I have been actively purchasing shares in the market.
Speaker Change: In terms of increasing training volumes, I think we've had real retail focus recently, I think Fred.
Speaker Change: and I am merely having a retail call every day. I really put focusing on on marginal buyers of shares and really trying to get attention on the stock. I would say that's really picked up certainly in the current gold price environment. We're getting a lot more attention.
Speaker Change: on the stock and certainly our leverage to the rising gold prices, so I'd expect that to trend higher.
Speaker Change: I might might also add just on that trading volume day, I think one of the topics we have had internally is talking about a US listing.
Speaker Change: at Sunsage and Dave and RGC, David Gothen have both been doing some work recently. Looking at the US listing opportunities and distancing the work and the costs and the ongoing requirements of that, so I think that that is another.
Speaker Change: that is another angle that I think will be looking at this year in terms of what we can do on that from.
Speaker Change: Fred, maybe a question that you could take the lead on as any update on the Egypt assets.
Fred: So yes, it's a good question. We put the background for everyone
Fred: into metals is our partner in Egypt and they are spending ten million dollars to earn into 80% of the company and we will have a 20% equity stake that will dilute after that point. We also have uncapped 1.5% royalty on all of those projects and we have milestone payments.
since that transaction was announced.
Fred: in the second half of 2023. Intumethals have completed two drill programs.
Fred: and I believe that they're committing now to that third. David also told us that they expect to hit the $10 million expenditure milestone this year.
Fred: So we are somewhat limited in what we can say publicly on that until they give us the green light but what I would say is they're on to their third drilling program they expect to hit 10 million dollar expenditure which has all been financed privately.
Fred: on the project this year, and to do that in that time frame.
Fred: suggests that they're getting results that are encouraging and they want to continue to push ahead, so when we're able to put some updates on that publicly with our partners into, we will, but at the moment, we just have to hold fire.
Fred: The very immediate time, until we get something from them.
Fred: Thanks, Fred. So, a question here from Carrie. Carrie, I hope you're well.
Just a question, I'm not thirsty on how the pipeline looks.
Fred: I think certainly from my side, I don't think I've seen us looking at more.
Also something as large as $50 or $60 million.
Fred: generally goals, generally near producing, but yeah, that certainly has been the focus and has always been the focus on the company's gold and copper and with good operators as near to production as possible. So I think definitely looking to use the powder that we have now to deploy non-diluted capital.
Fred: and then we've had a couple of questions on, on dividend. So, from Kerry Paul and Jacob there on
Fred: Now that we've got no debt and cash flow, are we thinking of dividends or more growth? I think specifically around the PDAC we...
Speaker Change: We had a strategy session with the board and we looked at various ways to improve liquidity and start to return or contemplate returning cash to shareholders.
Speaker Change: heavily and then obviously returning cash to shareholders would be a key target for us.
Speaker Change: As a result of that, we put in the NCID, the normal course issue of it. We have been in blackout through our annual financials and that will sadly roll pretty quickly into Q1 as well.
Speaker Change: But yeah, we certainly looked to use that NCIB if we felt like our shares were materially undervalued versus market and internal valuation.
Speaker Change: I think it would also know that Royalty company distributions are typically modifed, but I can get certainly to have that in the arsenal. And I guess in CLE versus dividends, they are typically a more tax-efficient way to return cash to shareholders. So I think that's going to be the focus in the near term.
Speaker Change: I would say as well, so the question from Paul is will the board wait till after, again, next year's, for your results to make a dividend decision?
Um.
Speaker Change: I mean, can't speak for our board, but I'd say no. Certainly we've already contemplated returning cash to shareholders and implemented the NCIB. And I guess the question would be is you do that on its own or a hybrid solution, but no, that's a very live discussion at the moment. I don't know if Fred, if you had anything else to add to that.
Fred: No, look, I think it's just worth reiterating for everyone that as a private company from day one, we did actually pay a dividend and we put that on hold when we lifted the company and went public. And I think the feedback we received then from shareholders was
Fred: The priority should be getting that critical mass and also lowering that cost of capital and we've now been through three real iterations of dropping our cost of capital and give you an example when we started we had a seat travel that he lent us [inaudible]
Fred: $4 million, I think it was at 12%, we then listed and we had a specialty mining lender that lent us funds for another acquisition for it.
at the moment.
Fred: that is giving us a credit facility at so full plus two and a half to four and a half percent. So...
Fred: We have, over time, grown that revenue base, we have lowered the cost of capital and over the last year, having repaid all of that debt, I think if we are going to be looking at a dividend, it's certainly the time to be having those sorts of conversations alongside buybacks.
and deploying that castle into new opportunities.
Speaker Change: Yeah, completely agree. Thanks, Fred. Another question for Paul, again, I'd like to be doing well, which existing royalties are likely to consider expanded production investment in 2025 by their mine operators.
Speaker Change: I think I can think there's a few off the top of my head. I'm clearly a large gold royalty in Kalawinda has already announced that 30% production, but they're putting the work into permitting and the capex into now, so we'll see the benefits of that in 20.
Speaker Change: 26. Ballerite would be another key one that are looking for material capital, investment there that would both improve throughput and then production. So also note that we've seen a Western Queen in WA, one of the world's user requirements up 32.
Speaker Change: that they're contemplating some toe milling there of the gold resource set.
Speaker Change: and so that's pretty live again. We'll guide to that when we get a bit more information from the operator. For those three assets, the Carlo and the Ballarat and West and Crane, I definitely would have...
would have near term production increases built in.
Speaker Change: So then a question would be there for Jacob. Do you have any comment on the expected use of free cash flow in 2025? Do you see opportunities in gold royalties or opportunities in other metals, ED tungsten, like McTung, a more attractive and comment on the interview? So we are covered off the interview. The key is definitely to deploy free cash flow in 2025 and use the credit facility for non-violuted acquisitions.
Speaker Change: Certainly, the opportunities we see are mostly gold. We definitely copper and gold focused, but we will look at everything. The first company, Royalty, was a mineral sand royalty that Fred and Richard acquired in 2017. That's going to be very returns.
Speaker Change: based. So if we do see a royalty that we think we can buy for $3 million up front when it comes into production, should pay $3 million every year.
Speaker Change: for more than 20 years. That's an absolute no-brainer for us. But definitely the focus on the company is gold and copper royalties, with a focus on gold. It's needed to production as possible.
Speaker Change: Questions on the deal flow, and if the higher gold price is making it hard to close deals? I know I've not seen that. I think consensus is still definitely lagging. It's still definitely lagging spot gold, and I think you can have a sensible conversation about what assumptions we use.
Speaker Change: for gold pricing. So, no, I've not, I've not, we've not experienced any, any gold price difficulties closing deals.
Speaker Change: And then next question is, is it a company more focused on gold and copper? And more local ROTC companies have been expanding to copper augustments?
Speaker Change: That's a very good point. And why do you believe we haven't seen more junior world companies merge or acquire?
Speaker Change: So no no definitely gold focused so about 70% of our revenue possibly more 75% of our revenue was gold. We have some more excellent copper development projects.
Speaker Change: in the Hopper, so Royalty and Arizona Synoron's Cactus, material, copper, development, royalty. We do target gold and copper as a priority, but yeah, we do look cross the board.
Speaker Change: there and yet have definitely noted that the copper royalties have been targeted across the space from the royalty companies. Fred, do you want to talk to the why we haven't seen more of?
Combinations in the junior royalty space.
Speaker Change: Yes, and it's a tricky one because I think like a lot of people can see the
The Merit
Speaker Change: in consolidation in the Royalty Business Model. I think that we appreciate that where we are and do use the example that we did and we talked a little bit about today on the Alpha Stream.
Speaker Change: Portfolio that we effectively consolidated in Key Port, and that was a Portfolio that we owned 50-50 and we put it together and actually that had, I think, synergies and values for us in doing that, and that is probably an analogy in some ways for the wider.
Speaker Change: and junior royalty space where I think we see that there is merit and I think it's probably widely acknowledged across that space, but also more generally in the royalty space, the business model is such that scale and critical mass.
Speaker Change: clearly have benefits and I think that over the course of, and we said this in September last year, but I think we said in September last year, if we roll forward to September 2025 and we haven't seen deals and consolidation in the royalty phase.
Speaker Change: I think that would probably be a missed opportunity so I think that from our perspective we continue to think that it will happen. The timing obviously a lot of variables into that. Bye bye.
Speaker Change: For the moment, what we do is we focus on what we really can't control.
and what we do ourselves.
and anything on the side, on the M&A side.
Speaker Change: You know, that comes on top of it. So really focus on what we can control.
Speaker Change: We see the logic and the sense in it, and at the right time, hopefully those options are there.
Speaker Change: and then Fred back to output followed DC and another question from Kerry. Thank you. Are there at 3,000 plus gold for DC and the assets that were out of the money that now look more interesting that could move the dots?
Speaker Change: Yeah, look, it's a good question. I think we have a number of brownfields, former gold lines in our portfolio in development stage.
Speaker Change: and if you took three, you would probably say Lava sending Western Australia.
Speaker Change: and that's a project that has been effectively warehouseed for probably the best part of 20 years and the majority owner has shamed on the Chinese parasitital.
Speaker Change: and look at that royalty. We have a 2% uncapped royalty on it in Western Australia. It covers just under 2 million answers. Has the potential to be a cornerstone royalty for us.
Speaker Change: The Lance Field mine that it covers used to be one of the top ten underground gold mines in West Australia in the 1990s and haven't been in production since 1997.
Speaker Change: So I think in that region, just in the sort of 30-pointed radius around that.
You've got goldfields, you've got that.
Speaker Change: and Genesis and all of my organs and to the south, you've got Simon Wildsmith and I do a gold shanty. So it is an area that is, I think, you know, overlooked and it's really right for one of the development progression. And then we have two also brown fields.
Speaker Change: Gold Assets, so we have all of these over in Canada, which are Pickle Crow and also Oakbrook. And again, I think it's a really similar story there in the economics looked good at $2,000 gold.
Allied: Thanks Fred. Next question is can you confirm that the payments supplied on the Keralis production will be received this quarter?
Speaker Change: in Q2. Yes, that is the plan. Generally, we get paid on our royalties and they provide the information within 30 days after the end of the quarter, so that's coming up in the next two weeks.
Speaker Change: and then payment thereafter. So yeah, we've been in contact with the allied team pretty regularly, both in person and on the phone, so don't see any changes to that plan.
Speaker Change: Question is, do we have any royalty income hedging policy? Is it attractive to capture some income at $3,300 dollars in case it's a short correction in price?
Speaker Change: We don't, and I don't think I've not really seen that in the royalty space, certainly we're all strong believers in gold here, and I think we've all been.
proven exceptionally right in the last few years and longer.
Speaker Change: Certainly my personal preference is that full exposure to gold price and I don't think we're necessarily quite...
Speaker Change: quite done yet. I think we certainly did have that question maybe even a year ago or a two months ago when gold was touching new highs of $2,200 gold will be considered hedging Simon.
Speaker Change: That certainly not our preference, unless we were required to by a death facility, but that's never come up with us. No, I think we definitely want that full exposure to all of the productions from our operators at Spock Gold prices and rising Spock Gold prices.
Speaker Change: and then a question from Joe Zunda. Again, hi Joe. Hope you're doing well. A question is do we have any concerns about royalties on assets in the tail region, such as Miley and Bikina? Is there a geographic focus on future acquisition?
Speaker Change: So I'd say no real concerns, I guess currently, with our assets, so why your performance has been, has been excellent.
Speaker Change: and again we've a strong operator in Marley with Allied Gold so I think that really does give us some comfort there. I guess in terms of the geographical focus, I'd say the majority of assets that we're looking at at the moment.
Speaker Change: in Australia or North America, South America, and we do look at the African assets of course.
Speaker Change: but we do know that there's probably an investor preference for tier one jurisdiction.
Speaker Change: in terms of the opportunities we're looking at at the moment. I'd say it's probably the preference to the Americas and Australia, but no, we do look at everything globally. Fred, would you have anything to add in to that point from Joe there in terms of, in terms of Theraldi said using that as an example?
Speaker Change: and I think the consensus values that Garali said that we have from analyst and market. I think we're probably in the next three, three and a half months.
Speaker Change: going to recover, you know, maybe as much as 50% of that value in actual royalty revenue and milestone payments from that asset. So I think that in that case.
because it is so front loaded.
Speaker Change: I think in three months time it's actually going to be materially de-risked.
even the value that we have today.
Farah
Speaker Change: look as there's obvious geographic and sovereign risk in a number of these jurisdictions, but I think Salio has been operating there for an excessive.
in excess of 12 years and for us.
I think.
Speaker Change: so far, how I've actually done a very good job bringing that into production in really record time, since we sold them the asset, and that notwithstanding all the government negotiations going on in Marley around licenses and permitting. So I think we're cautious as to our overall waiting in jurisdictions, Australia remains our largest single jurisdiction.
Speaker Change: and then in terms of a focus going forward, so I think we're just trying to be careful, not to overweight ourselves too much to anyone, regional or jurisdiction and when we look at your opportunities.
Speaker Change: And then I just the last question is there are thoughts on buying gold or silver with excess cash. I'd say yeah not at this point I'm pretty unless you had anything else to add on that.
Speaker Change: Yeah, it's an interesting question, but I don't know. We've actually had one or two shaddles and two that have reached out to us in the past and suggested that as we have a cash bill across the business, if we're not actively using it.
Holding
at www.LipomaCyst.com
Speaker Change: to gold and quality prices. So I think look clearly as we have over the next point three, three or four weeks.
Speaker Change: as we get some of these one-off payments in the Q1 revenues.
Speaker Change: we're going to have increasing cash on balance sheets and then we can make a decision on what we do with it whether that is putting it in high interest accounts or if we have that position ready to go or even looking at holding some physical as part of that but not something we have we have done yet.
Yep.
Speaker Change: And then the last question here, and just touching back on the one-off payments expected in 2025. Yeah, so to be clear, the $1 million from Allied on that first production at Carali Sud.
Speaker Change: the key on there as well as nearly $10 million from the Ming settlement, the Roundless settlement, which is landing imminently, and then on top of that.
Speaker Change: Arizona Synoron for that partial buyback that's due by the middle of the year.
Speaker Change: and then a potential $2 million of payment if Coralie so it hits $100,000 out of the production. This year, something happened this year, most likely it'll happen early next year.
Speaker Change: The one of cash outflows is that one and a half million dollar miles deferred payment on our Mac and Tonks and Royalty, so that's due in Q3 as well.
Fred: and Fred, that's it, so I might leave it to you to wrap up.
Fred: Yeah, well thank you very much Dave for running this through and thank you for the finance team as...
as well on our site.
Janae Tate
Baden Thander Road, contributing to this, and...