Elemental Royalties Announces Record Annual Revenue of US$5.1 Million for 2020 and Further Revenue Growth Forecast for 2021
February 25, 2021 – Vancouver, BC: Elemental Royalties Corp. (“Elemental” or “the Company”) (TSX-V: ELE, OTCQX: ELEMF) is pleased to report record annual revenue for 2020 and record quarterly revenue in Q4, alongside revenue guidance for 2021 that is the highest in the Company’s history. This has been driven by the transformational acquisition of a portfolio of precious metals royalties from South32 that will continue to accelerate Elemental’s revenue growth over the coming years.
Full Year and Q4 2020 Revenue
During 2020 Elemental achieved record preliminary revenue1 of approximately US$5.1 million, a 110% increase year-on-year and recorded approximately 2,900 attributable zero-cost gold equivalent ounces.2
During the three months ended December 31, 2020, the Company achieved record preliminary quarterly revenue1 of approximately US$1.5 million and recorded approximately 770 attributable zero-cost gold equivalent ounces. 2
- Royalty revenue more than doubled to US$5.1 million
- Acquired a 1% Net Smelter Return (‘NSR’) royalty on Teranga Gold’s Wahgnion Mine, which produced 175,261 ounces of gold in 2020
- Completed reverse-takeover on TSX Venture Exchange and C$24 million fundraise
- Commenced trading on OTCQX market and obtained DTC eligibility
- Binding agreement to acquire a portfolio of precious metals royalties in Western Australia from South32, including:
- 2% NSR royalty on Capricorn Metals’ under construction Karlawinda mine, targeting annual production of 110,000 to 125,000 ounces of gold; and
- 2% gross revenue royalty over key parts of Focus Minerals’ Laverton brownfields development project
- Announced C$16 million fundraise in conjunction with the South32 acquisition
- Amended and increased the existing facility with Sprott Resource Lending to US$25 million
- Portfolio weighting to Tier 1 jurisdictions increased to 65%
In 2021, Elemental expects 4,000 to 4,400 attributable zero-cost gold equivalent ounces2 from its existing portfolio, weighted towards the second half of the year, with 94% of expected revenue derived from gold and silver. At a US$1,800/oz average received gold price, this would achieve revenue of US$7.2 million to US$7.9 million in 2021.
|Gold equivalent ounces2||1,705||2,900||4,000 to 4,400|
|Year-on-year percentage change||+49%||+70%||+38% to +52%|
“We are pleased to have achieved our fourth consecutive year of record royalty revenue since inception.” said Frederick Bell, CEO of Elemental. “We expect continued revenue growth in 2021 as Capricorn Metals’ Karlawinda mine targets first gold pour in Q2, effectively doubling our gold royalty revenue from mid-year. With two transformational transactions now successfully completed, we are better placed than ever to continue to add value to the portfolio through 2021.”
On behalf of Elemental Royalties Corp.
CEO and Director
For further information about the Company or this news release, please visit our website at www.elementalroyalties.com or by email at firstname.lastname@example.org.
Elemental is a proud member of Discovery Group. For more information please visit: discoverygroup.ca or contact 604-653-9464.
Neither the TSX-V nor its Regulation Service Provider (as that term is defined in the policies of the TSX-V.) accepts responsibility for the adequacy or accuracy of this press release.
1 These figures have not been audited and are subject to change. As the Company has not yet finished its year-end annual close procedures, and the audit of its 2020 financial statements is not complete, the anticipated financial information presented in this press release is preliminary, subject to final year-end closing adjustments, and may change materially. The information presented above has not been audited by the Company’s independent accountants, should not be considered a substitute for audited financial statements, and should not be regarded as a representation by the Company as to the actual financial results.
2 Elemental has included certain performance measures in this press release that do not have any standardized meaning prescribed by International Financial Reporting Standards (IFRS). The Company’s royalty revenue is converted to an attributable gold equivalent ounce basis by dividing the royalty revenue received in a period by the average gold price for the same respective period. The presentation of this non-IFRS measure is intended to provide additional information 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 non-IFRS measures differently. The production forecast was derived using information that is available in the public domain as at the date hereof, which included guidance and estimates prepared and issued by management of the operators of the mining operations in which Elemental holds an interest. The production forecast is sensitive to the performance and operating status of the underlying mines. None of the information has been independently verified by Elemental and maybe subject to uncertainty. There can be no assurance that such information is complete or accurate.
About Elemental Royalties
Elemental is a gold-focused royalty company listed on the TSX-V in Canada and provides investors with lower risk precious metals exposure through a portfolio of nine high-quality royalties. This enables investors to benefit from ongoing royalty revenue, future exploration upside and low operating costs. Elemental’s experienced team seeks to secure royalties in advanced precious metals projects, run by established operators, from its pipeline of identified opportunities.
Richard Evans, FAusIMM, is Senior Vice President Technical for Elemental, and a qualified person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects, has reviewed and approved the scientific and technical disclosure contained in this press release.
Cautionary note regarding forward-looking statements
This release contains certain “forward looking statements” and certain “forward-looking information” as defined under applicable Canadian securities laws. Forward-looking statements and information can generally be identified by the use of forward-looking terminology such as “may”, “will”, “should”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “continue”, “plans” or similar terminology.
Forward-looking statements and information include, but are not limited to, statements with respect to the future growth and development of the Company. Forward-looking statements and information are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that, while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of Elemental to control or predict, that may cause Elemental’s actual results, performance or achievements to be materially different from those expressed or implied thereby, and are developed based on assumptions about such risks, uncertainties and other factors set out herein, including but not limited to: the requirement for regulatory approvals and third party consents, the impact of general business and economic conditions, the absence of control over the mining operations from which Elemental will receive royalties, including risks related to international operations, government relations and environmental regulation, the inherent risks involved in the exploration and development of mineral properties; the uncertainties involved in interpreting exploration data; the potential for delays in exploration or development activities; the geology, grade and continuity of mineral deposits; the impact of the COVID-19 pandemic; the possibility that future exploration, development or mining results will not be consistent with Elemental’s expectations; accidents, equipment breakdowns, title matters, labor disputes or other unanticipated difficulties or interruptions in operations; fluctuating metal prices; unanticipated costs and expenses; uncertainties relating to the availability and costs of financing needed in the future; the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations; currency fluctuations; regulatory restrictions, including environmental regulatory restrictions; liability, competition, loss of key employees and other related risks and uncertainties. Elemental undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed, and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.