All amounts are in U.S. dollars unless otherwise
indicated.
VANCOUVER, BC, Nov. 16, 2021
/CNW/ - Maverix Metals Inc. ("Maverix" or the "Company") (NYSE
American: MMX) (TSX: MMX) is pleased to announce operating and
financial results for the third quarter ended September 30, 2021.
Third Quarter 2021 Highlights
- Revenue of $13.7 million;
- Gold equivalent ounces ("GEOs") sold of 7,6711;
- Average cash cost per GEO of $164, resulting in a cash operating margin of 91%
or $1,616 per GEO1;
- Cash flow from operating activities, excluding changes in
non-cash working capital, of $9.7
million1;
- Net income of $2.8 million, or
$0.02 per share;
- Adjusted net income of $4.71 million, or $0.031 per share;
- Acquired a gold stream for $50
million and entered into a long-term strategic partnership
with Auramet; and
- Increased credit facility to $160
million.
Subsequent to Quarter End Highlights
- Increased and expanded the Company's royalty interest at the
Omolon mine operated by Polymetal for $23.5
million.
Dan O'Flaherty, CEO of Maverix,
commented, "Maverix had another active quarter, highlighted by the
acquisition of a gold stream from Auramet that immediately
increased cash flow and attributable GEOs. Maverix now has 122
royalties and streams with a focus on gold and with a good balance
between current cash generation and long-term optionality. Several
of the assets in our portfolio disclosed positive developments
during the quarter and we look forward to significant organic
growth from the strong portfolio we have built. We are also pleased
to increase our guidance to approximately 31,000 attributable
GEOs1 for 2021, which would be another record year for
Maverix."
Summary of Quarterly Results
|
|
|
|
|
|
Quarter
Ended
(in thousands of
USD, except for GEOs and per share amounts)
|
|
September 30,
2021
|
|
|
September 30,
2020
|
Statement of
Income and Comprehensive Income
|
|
|
|
|
|
Royalty
revenue
|
$
|
7,983
|
|
$
|
8,689
|
Sales
|
$
|
5,675
|
|
$
|
6,162
|
Total
revenue
|
$
|
13,658
|
|
$
|
14,851
|
Cash flow from
operating activities
|
$
|
9,278
|
|
$
|
13,792
|
Net income
|
$
|
2,829
|
|
$
|
14,437
|
Basic earnings per
share
|
$
|
0.02
|
|
$
|
0.11
|
Diluted earnings per
share
|
$
|
0.02
|
|
$
|
0.11
|
Dividends declared
per share
|
$
|
0.0125
|
|
$
|
0.01
|
Non-IFRS and Other
Measures1
|
|
|
|
|
|
Adjusted net
income
|
$
|
4,709
|
|
$
|
5,336
|
Adjusted basic
earnings per share
|
$
|
0.03
|
|
$
|
0.04
|
GEOs sold
|
|
7,671
|
|
|
7,797
|
Average realized gold
price per GEO
|
$
|
1,780
|
|
$
|
1,905
|
Average cash cost per
GEO
|
$
|
164
|
|
$
|
195
|
Cash flow from
operating activities, excluding changes in non-cash working
capital
|
$
|
9,682
|
|
$
|
10,841
|
For complete details please refer to the Condensed Consolidated
Interim Financial Statements and associated Management Discussion
and Analysis for the quarter ended September
30, 2021, available on SEDAR (www.sedar.com), EDGAR
(www.sec.gov) or on Maverix's website (www.maverixmetals.com).
To listen to Maverix's President, Ryan
McIntyre, discuss the Q3 results please use this
link: Maverix Q3 2021 Results
Increased 2021 Outlook
Maverix is pleased to report that it expects to exceed the upper
end of its previously announced outlook of 27,000 to 30,000
attributable GEOs1, with a new forecast of approximately
31,000 attributable GEOs1 for 2021. This will mark the
fifth consecutive year of record attributable GEOs for the
Company.
Asset Portfolio Updates
Auramet Gold Stream
On September 27, 2021, the Company
entered into an agreement with Auramet Capital Partners, L.P., an
affiliate of Auramet International LLC ("Auramet"), to acquire a
gold stream and enter a long-term strategic partnership.
Maverix made a cash payment of $50
million to acquire a gold stream that will deliver 5,000
ounces of gold to Maverix per year. The gold stream shall be
delivered quarterly and Maverix will make ongoing cash payments
equal to 16% of the spot gold price for each gold ounce delivered.
After a total of 50,000 ounces of gold have been delivered to the
stream, Auramet shall have the option to terminate the stream for a
cash payment of $5 million less
certain cash flows related to the stream.
In addition to the gold stream, Maverix will be entitled to
receive an amount in gold that is equivalent to all dividends
distributed by Auramet on 2% of its shares outstanding, which is
done semi-annually.
For more information, please refer to the Company's website and
see the news release dated September 27,
2021.
Omolon (2.5% GRR)
On October 18, 2021, the Company
increased and expanded its royalty interest at the Omolon gold mine
operated by Polymetal International plc ("Polymetal"). Maverix made
a cash payment of $23.5 million to
increase its effective interest to a 2.5% gross revenue royalty and
expand the royalty coverage to include all 13 licenses that
currently comprise the Omolon hub and potentially an additional
three that are in the application phase. Prior to this transaction,
Maverix's 2% gross revenue royalty covered two licenses (Tsokol
Kubaka and Birkachan). This transaction is expected to increase
Omolon's annual contribution to Maverix's attributable gold
equivalent ounces from approximately 2,000 ounces to approximately
5,000 ounces.
Upon sales of one million gold equivalent ounces at Omolon, post
completion of the transaction, the effective interest will decrease
from 2.5% to 2.0%, and upon sales of 1.2 million gold equivalent
ounces, Maverix will make an additional $1.5
million cash payment.
For more information, please refer to the Company's website and
see the news release dated October 18,
2021.
Camino Rojo (2% NSR)
On November 15, 2021, Orla Mining
Ltd. announced that construction of its Camino Rojo project was 96% complete as of
October 31, 2021. Mining operations
commenced during the third quarter, including drilling, blasting,
and hauling of ore and waste. Leaching activities are expected to
begin in mid-November 2021 with first
gold production expected by late 2021.
For more information, please refer to orlamining.com and see the
news release dated November 15,
2021.
Beta Hunt (4.75% Gold Royalty and 1.5% Nickel NSR)
On September 8, 2021, Karora
Resources Inc. ("Karora") announced a major extension of the Larkin
Zone at Beta Hunt to over 1,000 metres of strike. The initial phase
of drilling at Larkin was completed in July
2021 and the maiden resource for the Larkin Zone will be
included in Karora's 2021 consolidated mineral resource update
expected in early 2022.
For more information, please refer to
karoraresources.com and see the news release dated
September 8, 2021.
Mother Lode (1% – 2% NSR)
On September 13, 2021, Corvus Gold
Inc. ("Corvus") announced that it entered into a definitive
agreement to be acquired by AngloGold Ashanti Limited ("AngloGold")
at an implied equity value of approximately $450 million. The transaction consolidates a
large land package in the Beatty
district of Nevada, which includes
AngloGold's Silicon project and Corvus' Mother Lode project.
Further details on AngloGold's integrated development plan for the
Beatty district will be
communicated during 2022.
For more information, please refer to corvusgold.com and see the
news release dated September 13,
2021.
Hope Bay (1% NSR)
On November 2, 2021, Agnico Eagle
Mines Limited ("Agnico Eagle") provided an exploration update at
Hope Bay. In 2021, Agnico Eagle is carrying out delineation,
conversion and exploration drilling programs at the Hope Bay
property using three rigs from underground and four rigs at
surface. During the third quarter of 2021, 135 drill holes totaling
28,302 metres were completed at the Doris and Madrid deposits, and year to date a total of
71,453 metres have been completed compared to a budget of 69,600
metres. Based on drilling to date at Doris, Agnico Eagle believes
there is good potential to extend the deposit along strike to the
north and to add to the mineral resources at Doris beneath the
diabase dike with continued drilling on the BTD Extension, BTD
Connector/West Valley and BTD Central zones.
For more information, please refer to agnicoeagle.com and see
the news release dated November 2,
2021.
Koné (2% NSR)
On August 19, 2021, Montage Gold
Corp. announced an updated mineral resource at Koné including a
maiden indicated mineral resource of 225 million tonnes at 0.59
grams per tonne ("g/t") gold containing 4.27 million ounces of gold
and an inferred resource of 22 million tonnes at 0.45 g/t gold
containing 0.32 million ounces of gold. The feasibility study is
expected to be completed in Q1 2022.
For more information, please refer to montagegoldcorp.com and
see the news release dated August 19,
2021 and the October 2021
corporate presentation.
Moss (100% Silver Stream)
On October 21, 2021, Elevation
Gold Mining Corporation ("Elevation") announced an updated mineral
reserve and resource estimate including a 36% increase in measured
and indicated resources. The updated proven and probable mineral
reserves consist of 12.7 million tonnes with grades of 0.45 g/t
gold and 5.4 g/t silver containing 184,500 ounces of gold and 2.2
million ounces of silver. Measured and indicated mineral resources
of 38.8 million tonnes with grades of 0.39 g/t gold and 4.6 g/t
silver, containing 490,200 ounces of gold and 5.75 million ounces
of silver and inferred mineral resources of 6.6 million tonnes with
grades of 0.35 g/t gold and 4.5 g/t silver containing 73,800 ounces
of gold and 940,000 ounces of silver.
For more information, please refer to elevationgold.com and see
the news release dated October 21,
2021.
Dividend
The quarterly cash dividend of $0.0125 per common share will be paid on or about
December 15, 2021 to shareholders of
record as of the close of business on November 30, 2021.
This dividend is designated as an "eligible dividend" for the
purposes of the Income Tax Act (Canada). Dividends paid by Maverix to
shareholders outside Canada
(non-resident investors) will be subject to Canadian non-resident
withholding taxes. The declaration, timing, amount and payment of
future dividends remains at the discretion of Maverix's Board of
Directors.
1 Maverix has included certain
performance measures in this news release that do not have any
standardized meaning prescribed by International Financial
Reporting Standards ("IFRS") including adjusted net income, total
GEOs sold, average realized gold price per GEO, average cash cost
per GEO, cash operating margin and cash flow from operating
activities, excluding changes in non-cash working capital. Adjusted
net income is calculated by excluding the effects of the non-cash
cost of sales related to the Auramet gold stream, non-cash change
in fair value of the Auramet gold stream, other income/expenses,
impairment charges, gains/(losses) on sale or amendments of royalty
and streams and unusual non-recurring items. The Company believes
that adjusted net income is a useful measure of the Company's
performance because it adjusts for items which may not relate to or
have a disproportionate effect on the period in which they are
recognized, impact the comparability of our core operating results
from period to period, are not always reflective of the underlying
operating performance of our business and/or are not necessarily
indicative of future operating results. The Company's royalty
revenue and silver sales are converted to a GEO basis by dividing
the royalty revenue and silver sales for a period by the average
gold price based on the LBMA Gold Price PM Fix per ounce for the
same respective period. These GEOs when combined with the gold
ounces sold from the Company's gold streams equal total GEOs sold.
Average realized gold price per GEO is calculated by dividing the
total revenue by the GEOs sold. Average cash cost per GEO is
calculated by dividing the total cost of sales, less depletion less
non-cash cost of sales of the Auramet gold stream, by the GEOs
sold. In the precious metals mining industry, these are common
performance measures but do not have any standardized meaning. Cash
operating margin is calculated by subtracting the average cash cost
per GEO sold from the average realized gold price per GEO sold. The
Company presents cash operating margin as it believes that certain
investors use this information to evaluate the Company's
performance in comparison to other companies in the precious metal
royalty and streaming sector who present results on a similar
basis. The Company has also used the non-IFRS measure of operating
cash flows excluding changes in non-cash working capital. This
measure is calculated by adding back the decrease or subtracting
the increase in changes in non-cash working capital to or from cash
provided by (used in) operating activities. The presentation of
these non-IFRS measures 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 2021 forecast herein assumes a gold price of
$1,700 per ounce and a silver price of $21 per ounce. The 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 Maverix holds an interest. The forecast is
sensitive to the performance and operating status of the underlying
mines. None of the information has been independently verified by
Maverix and may be subject to uncertainty. There can be no
assurance that such information is complete or accurate. Maverix's
business, operations, financial condition, and financial outlook
could be materially adversely affected by the continued impact of
the COVID-19 global health pandemic. At this time, Maverix cannot
reasonably estimate the duration of any potential business
disruptions, impact to underlying operations that Maverix holds an
interest in or any related financial impact that is related to or
caused by COVID-19.
|
Qualified Person
Brendan Pidcock, P.Eng., is Vice
President, Technical Services for Maverix, 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 news release.
About Maverix
Maverix is a gold-focused royalty and streaming company with a
globally diversified portfolio of over 100 assets. Maverix's
mission is to increase per share value by acquiring precious metals
royalties and streams. Its shares trade on both the NYSE American
and the TSX under the symbol "MMX".
Cautionary statements to U.S. investors
Information contained or referenced in this press release or in
the documents referenced herein concerning the properties,
technical information and operations of Maverix has been prepared
in accordance with requirements and standards under Canadian
securities laws, which differ from the requirements of US
securities laws. The terms "mineral resource" and "inferred mineral
resource" used in this press release or in the documents
incorporated by reference herein are mining terms as defined in
accordance with NI 43-101 under guidelines set out in the
Definition Standards for Mineral Resources and Mineral Reserves
adopted by the Canadian Institute of Mining, Metallurgy and
Petroleum Council. While the terms "mineral resource", and
"inferred mineral resource" are recognized and required by Canadian
securities laws, they are not recognized by SEC Industry Guide 7
and normally are not permitted to be used in reports filed with the
SEC. The SEC has adopted amendments to its disclosure rules to
modernize the mineral property disclosure requirements for issuers
whose securities are registered with the SEC under the U.S.
Securities Exchange Act of 1934 (the "SEC Modernization Rules").
Under the SEC Modernization Rules, the SEC will permit issuers to
disclose estimates of mineral resources if certain conditions are
met. Because the Company is eligible for the Multijurisdictional
Disclosure System adopted by the SEC and Canadian Securities
Administrators, the Company is not required to present disclosure
regarding its mineral properties in compliance with the SEC
Modernization Rules. Accordingly, certain information contained in
this press release concerning descriptions of mineralization and
mineral resources under these standards may not be comparable to
similar information made public by US companies subject to
reporting and disclosure requirements of the SEC.
Cautionary note regarding forward-looking statements
This release contains certain "forward looking statements" and
certain "forward-looking information" as defined under applicable
Canadian and U.S. 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. The forward-looking
information contained herein is provided for the purpose of
assisting readers in understanding management's current
expectations and plans relating to the future. Readers are
cautioned that such information may not be appropriate for other
purposes. Forward-looking statements and information include, but
are not limited to, statements with respect to the Company's annual
guidance, the payment of the declared dividend, and developments at
certain of the mines, projects or properties that underlie the
Company's interests. 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 information is subject to known and unknown risks,
uncertainties and other factors that may cause the actual actions,
events or results to be materially different from those expressed
or implied by such forward-looking information, including but not
limited to: the impact of general business and economic conditions;
the absence of control over mining operations from which Maverix
will purchase gold and other metals or from which it will receive
royalty payments and risks related to those mining operations,
including risks related to international operations, government and
environmental regulation, delays in mine construction and
operations, actual results of mining and current exploration
activities, conclusions of economic evaluations and changes in
project parameters as plans continue to be refined; accidents,
equipment breakdowns, title matters, labor disputes or other
unanticipated difficulties or interruptions in operations; problems
inherent to the marketability of gold and other metals; the
inherent uncertainty of production and cost estimates and the
potential for unexpected costs and expenses; industry conditions,
including fluctuations in the price of the primary commodities
mined at such operations, fluctuations in foreign exchange rates
and fluctuations in interest rates; government entities
interpreting existing tax legislation or enacting new tax
legislation in a way which adversely affects Maverix; stock market
volatility; regulatory restrictions; liability, competition, the
potential impact of epidemics, pandemics or other public health
crises, including the current outbreak of the novel coronavirus
known as COVID-19 on Maverix's business, operations and financial
condition, loss of key employees, as well as those risk factors
discussed in the section entitled "Risk Factors" in Maverix's
annual information form dated March 23,
2021 available at www.sedar.com. Maverix has attempted to
identify important factors that could cause actual results to
differ materially from those contained in forward-looking
statements, there may be other factors that cause results not to be
as anticipated, estimated or intended. There can be no assurance
that such statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers are advised not to place
undue reliance on forward-looking statements or information.
Maverix 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.
Technical and third-party information
The disclosure herein and relating to properties and operations
on the properties in which Maverix holds royalty, stream or other
interests is based on information publicly disclosed by the owners
or operators of these properties and information/data available in
the public domain as at the date hereof, and none of this
information has been independently verified by Maverix.
Specifically, as a royalty or stream holder, Maverix has limited,
if any, access to properties included in its asset portfolio.
Additionally, Maverix may from time to time receive operating
information from the owners and operators of the properties, which
it is not permitted to disclose to the public. Maverix is dependent
on, (i) the operators of the properties and their qualified persons
to provide information to Maverix, or (ii) on publicly available
information to prepare disclosure pertaining to properties and
operations on the properties on which Maverix holds royalty, stream
or other interests, and generally has limited or no ability to
independently verify such information. Although Maverix does not
have any knowledge that such information may not be accurate, there
can be no assurance that such third-party information is complete
or accurate. Some information publicly reported by operators may
relate to a larger property than the area covered by Maverix's
royalty, stream or other interest. Maverix's royalty, stream or
other interests often cover less than 100% and sometimes only a
portion of the publicly reported mineral reserves, mineral
resources, and production of a property.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/maverix-announces-third-quarter-2021-results-increases-guidance-and-declares-quarterly-dividend-301424946.html
SOURCE Maverix Metals Inc.