© Reuters.
Triple Flag Treasured Metals Corp reported strong efficiency within the third quarter of 2023, with gross sales of 25,629 gold equal ounces and an working money stream of $37 million. The corporate’s portfolio noticed constructive developments and achieved progress in a number of mining operations. The agency’s financials for Q3 2023 confirmed robust revenues, adjusted EBITDA, and working money stream, alongside a quarterly dividend of $0.0525 per share.
Key takeaways from the earnings name embody:
- Triple Flag’s portfolio noticed constructive developments, together with progress on the Northparkes E31 and E31 north deposits, exploration at Cerro Lindo, and useful resource enlargement at Buritica.
- The corporate acquired further NSR royalties on the Star and Stawell mines in Australia, enhancing its well-diversified asset portfolio targeted on valuable metals.
- The corporate’s dedication to sustainability was acknowledged with an improved Sustainalytics ESG ranking.
- Triple Flag stays on observe to attain its 2023 steering vary and maintains a robust steadiness sheet with ample liquidity.
- The corporate expressed a choice for cash-generating streams and royalties and a conservative strategy to manufacturing expectations.
- Regardless of write-downs on Renard and Pumpkin Hole as a result of market situations and struggles within the diamond and sectors, the corporate stays targeted on prudent capital allocation.
In the course of the earnings name, Triple Flag expressed optimism about its future, highlighting regular efficiency, accretive additions to its portfolio, and a strong steadiness sheet. The corporate additionally talked about its concentrate on offers that generate money or have a transparent path to doing so, indicating alternatives to extend their streams and royalties for expansions and investments in producing belongings.
The corporate additionally emphasised its curiosity in future offers with minimal fairness elements and mentioned its concentrate on sustaining liquidity and a conservative posture. Triple Flag expressed assist for copper as a vital commodity and mentioned the challenges confronted by junior fairness markets. The corporate additionally talked about the potential for rising their publicity to current initiatives and increasing their portfolio belongings.
Triple Flag is trying ahead to the upcoming steering for 2024 and past, sustaining its main sustainability place and specializing in prudent capital allocation. The corporate’s robust third-quarter efficiency and optimistic outlook sign a constructive future for the dear metals agency.
InvestingPro Insights
Based mostly on real-time information from InvestingPro, Triple Flag Treasured Metals Corp is buying and selling at a excessive earnings a number of of 58.72, indicating that the market has excessive expectations for the corporate’s future earnings development. Within the final twelve months as of Q3 2023, the corporate’s income development has been accelerating, posting a considerable 35.3% enhance. This aligns with their reported robust Q3 efficiency and optimistic outlook. Moreover, the corporate’s market cap stands at a strong 2410M USD.
InvestingPro Ideas reveal that Triple Flag has been constant in rewarding its shareholders, having raised its dividend for 3 consecutive years. This can be a constructive signal for traders searching for common revenue. Nonetheless, it needs to be famous that 3 analysts have revised their earnings downwards for the upcoming interval, which may be a trigger for concern.
For these enthusiastic about a extra complete evaluation, InvestingPro provides a mess of further ideas and real-time information metrics.
Full transcript – TFPM Q3 2023:
Operator: Thanks for standing by. My identify is Eric, and I can be your convention operator in the present day. Right now, I wish to welcome everybody to the Triple Flag Q3 2023 Outcomes Name. All strains have been positioned on mute to forestall any background noise. After the audio system’ remarks there can be a question-and-answer session. [Operator Instructions] I’d now like to show the decision over to Shaun Usmar, CEO. Please go forward.
Shaun Usmar: Thanks, and good morning, everybody, and thanks for becoming a member of us to debate Triple Flag’s third quarter 2023 outcomes. At present, I am joined by our CFO, Sheldon Vanderkooy and our Senior Vice President of Company, James Dendle. Our enterprise continues its robust efficiency in the course of the third quarter with gross sales of 25,629 gold equal ounces, leading to US$37 million of working money stream. Our portfolio is performing properly with many belongings experiencing constructive catalysts in the course of the quarter, such because the excessive gold grade open pit E31 and E31 north deposits at Northparkes persevering with to progress down the event observe and can begin contributing to Triple Flag’s GEOs in 2024. Exploration progressing at Cerro Lindo and useful resource enlargement at Buritica. Moreover, our earlier stage exploration belongings proceed to advance, highlighted by Hope Bay, [DeLamar], Tamarack and [indiscernible]. As well as, we acquired a further 2.65% NSR royalty on the manufacturing Star mine in Australia for US$16.6 million, persevering with our strong tempo of accretive transactions following the Agbaou Royalty acquisition in Q2. Together with the Maverix, which we closed earlier this 12 months, this brings the entire worth of transactions closed throughout 2023 and to just about US$700 million. Simply after quarter finish, our dedication to sustainability was showcased by means of our improved Sustainalytics ESG ranking, which now locations us third out of 117 firms within the world valuable metals sector. We’re proud to exemplify the worth of sustainability that assist form this enterprise, and I respect the work of our group to get so far. I am going to now flip it over to Sheldon to debate our financials for Q3 2023.
Sheldon Vanderkooy: Thanks, Shaun. We had a robust third quarter, realizing gross sales of over 25,600 gold equal ounces. We’re comfortably on observe to attain our 2023 steering. Our Q3 GEOs in flip resulted in robust revenues, adjusted EBITDA and working money stream within the quarter. We additionally acknowledged an impairment cost within the quarter due predominantly to the Renard diamond mine being positioned on care and upkeep. The diamond market has weakened considerably this previous 12 months and the difficulties of the sector are well-known. This can be a noncash cost, and we don’t have any additional publicity to Renard in our statements going ahead. Our working money stream of almost $37 million resulted in working money stream per share of $0.18. And a rise in comparison with the identical interval in 2022. Yr-to-date, our portfolio generated a strong $116 million of working money stream for use for dividends, debt reimbursement, shareholder returns and exterior development alternatives. Our quarterly dividend has been maintained at US$0.0525 per share or $0.21 per share on an annualized foundation. I might additionally wish to touch upon our robust steadiness sheet, which is more and more vital in in the present day’s excessive rate of interest surroundings. We completed the quarter with $65 million in debt and simply $50 million of debt internet of money. This represents simply 4 months of money flows at present run charges. Subsequent to quarter finish, we repaid $8 million of debt, additional strengthening our steadiness sheet. Lastly, our asset margins for the quarter remained robust at 90%. And excessive asset margins are a key characteristic of the streaming and royalty mannequin and assist guarantee strong money stream technology. I am going to now flip to Slide 6. Slide 6 highlights three essential facets of our portfolio. specifically asset diversification, valuable metals focus and a portfolio which is predominantly centered within the Americas and Australia. Our income is properly diversified throughout our portfolio. Cerro Lindo and Northparkes are our largest contributors to the quarter representing 21% and 15% of quarterly revenues, respectively. We’re strongly valuable metals targeted. Gold and Silver accounted for roughly 96% of our revenues amongst the best within the sector. Our portfolio was predominantly positioned in mining-friendly jurisdictions. By geography, the nation with a single best contribution is Australia. Our Australian producing belongings embody Northparkes, Fosterville and Beta Hunt as properly a lot of smaller contributors, together with [indiscernible]. With our enhance of the [indiscernible] royalty, I’m very happy that we’ve got elevated our publicity to a low-risk jurisdiction. I am going to now flip to James, who will converse to our asset highlights.
James Dendle: Thanks, Sheldon. There have been a lot of vital advances made throughout the portfolio in the course of the third quarter. Northparkes has commenced mining the E31 open pits, which host increased gold grades and we anticipate CE31 pit ore course of information this 12 months, which can drive GEO’s development in 2024. Cominar [ph] had a robust efficiency in the course of the quarter within the first half of the 12 months with all our rising 2023 manufacturing steering to between 110,000 to 120,000 ounces of gold from 100,000 to 110,000 ounces beforehand. At DeLamar, a profitable drilling program elevated heap leachable ounces within the measured and indicated classes by roughly 25% and within the inferred class by 31%. Cerro Lindo had a robust quarter after renewed entry to the high-grade areas that was restricted throughout heavy rainfall from cyclone Yako earlier this 12 months, along with an ongoing exploration program. At Buritica, the operation continues to carry out constantly. [indiscernible] has been capable of develop the gold useful resource by roughly 700,000 ounces within the measured and indicated classes and roughly 570,000 ounces within the inferred class during the last 12 months after manufacturing depletions, highlighting the numerous prospectivity inside this district. And eventually, Agnico Eagle (NYSE:)’s exploration program at Hope Bay continued in the course of the quarter with 119,000 meters of drilling accomplished within the first 9 months of the 12 months. Agnico is evaluating bigger manufacturing eventualities on the mission, which can immediately profit our royalty. Turning to the following web page. As Shaun beforehand talked about, late within the quarter, we acquired a further 2.5% NSR royalty on producing retailer mine operated by nonetheless Gold mines for US$16.6 million. bringing our whole publicity to the mine to a 3.65% NSR royalty. Stawell is clearly an asset we all know properly, and we’re pleased to extend our publicity to this well-run operation. Stawell is a predominantly underground mine positioned 250 kilometers northwest of Melbourne. The mine commenced manufacturing in 1981 and has a robust observe report of manufacturing and a historical past of reserve substitute. Our plant refurbishments accomplished in 2019 and ongoing exploration expenditure and outcomes have pushed a big enhance to the useful resource stock, inserting the mine on a strong long-term and flipping. Stawell retailer is anticipated to have no less than a 10-year lifetime of mine with forecasted annual gold manufacturing ramping as much as roughly 70,000 ounces each year in the long run from round 50,000 ounces presently. Over to you, Shaun.
Shaun Usmar: James, thanks. Because the snapshot demonstrates, Triple Flag is primed to construct on our main observe report. And as Sheldon talked about, I am pleased to say that we’re on observe to attain our steering vary for 2023, which stays unchanged at 100,000 to 115,000 ounces. With our amplify energy of roughly US$650 million in out there liquidity, a broad base of 234 belongings and a five-year common annual manufacturing outlook of 140,000 gold equal ounces, we’re excited to proceed rising Triple Flag into a pacesetter within the sector with our prime sustainability rankings and prudent capital allocation selections. With the Board and administration group being giant shareholders ourselves, we utterly aligned in making certain one of the best outcomes for all stakeholders and are trying ahead to what 2024 has to supply. With that, Eric, please open the ground to any questions.
Operator: [Operator Instructions] Your first query comes from the road of Lawson with BofA Securities.
Lawson Winder: Shaun, Sheldon and James. I simply wished to ask in regards to the two write-downs and form of form of your considering on potential classes realized, each Renard and for sorry. I imply, clearly, there have been very cheap investments relative to your general investments. However I imply, is there one thing to glean from that that may be utilized going ahead to different belongings? Or is that this simply the case of unlucky market situations and unknowable unknowns?
Shaun Usmar: Hear, look, firstly, it is a good query. I feel any group with its approach is attempting to have a look at the issues which are inside your management that you may study from. If I’m going particularly to the Renard transaction, we have been discussing this simply with our Board yesterday, there was a $200 million transaction performed 5, six years in the past. Diamonds, as you understand, are kind of noncore, and we tried on the time to bifurcate a gold stream, specifically from a diamond stream and it was kind of a package deal deal. And I suppose on the time, we rationalized it by saying — it is a producing Canadian asset with robust assist from Quebec and different establishments. I labored with the previous Freni colleague of ours who had run Debswana [ph], gave us some professional enter into the due diligence on the time as a result of it’s outdoors of our atypical sphere. And that every one went fairly properly. And I feel as we glance with hindsight, you made the purpose it is 234 belongings. I feel in the event you have a look at our general proportion of write-downs on our internet invested capital, we really — we would be the finest within the sector amongst any of our friends. –…
