UROY Uranium Royalty Corporation

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
UNDER the Securities Exchange Act of 1934

For the month of December 2024
Commission File No.: 001-40359

Uranium Royalty Corp.
(Translation of registrant’s name into English)

Suite 1830, 1188 West Georgia Street

Vancouver, British Columbia, V6E 4A2, Canada
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F ☐ Form 40-F ☒

 

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iNCORPORATION bY rEFERENCE

 

Exhibits 99.1 through 99.4 contained in this Report on Form 6-K shall be deemed to be incorporated by reference into the registration statement on Form F-10, as amended (Registration No. 333-272534) of Uranium Royalty Corp. (including any prospectuses forming a part of such registration statement) and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	Uranium Royalty Corp.
Date: December 12, 2024	By:	/s/ Josephine Man
	Name:	Josephine Man
	Title:	Chief Financial Officer

 

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EXHIBIT INDEX

Exhibit		Description of Exhibit
99.1		Condensed interim consolidated financial statements for the three and six months months ended October 31, 2024
99.2		Management’s discussion and analysis for the three and six months ended October 31, 2024
99.3		Certification of Chief Executive Officer

 

99.4		Certification of Chief Financial Officer

 

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Exhibit 99.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

UNAUDITED CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED OCTOBER 31, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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		As at October 31, 2024			As at April 30, 2024
	Notes	($)			($)
Assets
Current Assets
Cash	4		12,931			21,100
Restricted cash	4		110			110
Accounts receivable			41			13,818
Short-term investments	5		7,994			9,143
Inventories	6		221,176			187,090
Prepaids and other receivables			218			490
			242,470			231,751
Non-current Assets
Right-of-use assets			217			181
Royalties	7		58,282			46,771
			58,499			46,952
Total Assets			300,969			278,703
Liabilities
Current Liabilities
Accounts payable and accrued liabilities			1,333			1,202
Finance payable	8		18,933			—
Other payables			—			1,519
Current portion of lease liability			52			37
			20,318			2,758
Non-current Liability
Non-current portion of lease liability			183			156
			183			156
Total Liabilities			20,501			2,914
Equity
Issued capital	9		253,153			244,397
Reserves	9		5,684			6,316
Share issuance obligation	9		240			—
Retained earnings			19,936			22,522
Accumulated other comprehensive income			1,455			2,554
			280,468			275,789
Total Liabilities and Equity			300,969			278,703

 

Commitments (Note 14)

Subsequent events (Note 15)

Approved by the Board of Directors:

/s/Ken Robertson		/s/Neil Gregson
Ken Robertson Director		Neil Gregson Director

The accompanying notes are an integral part of these condensed interim consolidated financial statements

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	Notes	For the three months ended October 31,						For the six months ended October 31,
		2024			2023			2024			2023
		($)			($)			($)			($)
Revenue
Sales of uranium inventory			10,862			15,318			10,862			15,318
Royalty revenue			41			—			41			—
Cost of sales
Cost of uranium inventory			(7,998	)		(11,054	)		(7,998	)		(11,054	)
Depletion			(30	)		—			(30	)		—
Gross profit			2,875			4,264			2,875			4,264
Expenses
Salaries and directors' fees	12		(298	)		(266	)		(574	)		(525	)
Office and administration	10		(1,469	)		(1,789	)		(2,849	)		(2,173	)
Professional fees and insurance			(471	)		(403	)		(800	)		(854	)
Transfer agent and regulatory fees			(223	)		(225	)		(349	)		(597	)
Share-based compensation			(292	)		(381	)		(381	)		(428	)
Operating income (loss) for the period			122			1,200			(2,078	)		(313	)
Other items
Other income			—			—			—		10
Finance cost	8		(312	)		—			(312	)		—
Interest expense			(4	)		—			(9	)		(2	)
Interest income			129			93			368			94
Net foreign exchange gain (loss)			(331	)		1,047			(401	)		966
Income (loss) before taxes			(396	)		2,340			(2,432	)		755
Deferred income tax recovery (expense)			(32	)		1,150			(154	)		1,693
Net income (loss) for the period			(428	)		3,490			(2,586	)		2,448
Other comprehensive income (loss)
Items that will not subsequently be re-classified to net income (loss):
Gain (loss) on revaluation of short-term investments	5		(178	)		8,521			(1,499	)		12,542
Deferred tax recovery (expense) on short-term investments	5		32			(1,150	)		154			(1,693	)
Item that may subsequently be re-classified to net income:
Foreign currency translation differences			206			884			246			416
Total other comprehensive income (loss) for the period			60			8,255			(1,099	)		11,265
Total comprehensive income (loss) for the period			(368	)		11,745			(3,685	)		13,713
Net income (loss) per share
Basic earnings (loss) per share		(0.00)				0.03			(0.02	)		0.02
Diluted earnings (loss) per share		(0.00)				0.03			(0.02	)		0.02
Weighted average number of shares outstanding
Basic	9		121,970,820			102,699,912			121,393,943			101,353,526
Diluted	9		121,970,820			109,864,784			121,393,943			107,330,770

 

The accompanying notes are an integral part of these condensed interim consolidated financial statements

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		Number of Common			Issued Capital			Reserves			Share Issuance Obligation			Retained Earnings/ (Accumulated Deficit)			Accumulated Other Comprehensive Income			Total
	Notes	Shares			($)			($)			($)			($)			($)			($)
Balance at April 30, 2023			99,803,729			167,277			6,319			—			(11,855	)		13,628			175,369
Common shares issued upon exercise of warrants			1,539,300			3,465			(386	)		—			—			—			3,079
Public offering:
Common shares issued for cash			10,205,000			40,948			—			—			—			—			40,948
Underwriters' fees and issuance costs			—			(2,729	)		—			—			—			—			(2,729	)
At-the-Market offering:
Common shares issued for cash			870,910			3,534			—			—			—			—			3,534
Agents' fees and issuance costs			—			(88	)		—			—			—			—			(88	)
Transfer of other comprehensive income to retained earnings upon disposal of short-term investments			—			—			—			—			13,270			(13,270	)		—
Share-based compensation			—			—			428			—			—			—			428
Net income for the period			—			—			—			—			2,448			—			2,448
Total other comprehensive income			—			—			—			—			—			11,265			11,265
Balance at October 31, 2023			112,418,939			212,407			6,361			—			3,863			11,623			234,254
Common shares issued upon exercise of warrants			1,410,794			3,176			(355	)		—			—			—			2,821
Public offering:
Common shares issued for cash			6,724,600			30,774			—			—			—			—			30,774
Underwriters' fees and issuance costs			—			(1,960	)		—			—			—			—			(1,960	)
Transfer of other comprehensive income to retained earnings upon disposal of short-term investments			—			—			—			—			11,327			(11,327	)		—
Share-based compensation			—			—			310			—			—			—			310
Net income for the period			—			—			—			—			7,332			—			7,332
Total other comprehensive income			—			—			—			—			—			2,258			2,258
Balance at April 30, 2024			120,554,333			244,397			6,316			—			22,522			2,554			275,789
Common shares issued upon exercise of warrants	9		3,868,762			8,665			(985	)		240			—			—			7,920
Common shares issued upon exercise of options	9		17,750			91			(28	)		—			—			—			63
Share-based compensation	9		—			—			381			—			—			—			381
Net loss for the period			—			—			—			—			(2,586	)		—			(2,586	)
Total other comprehensive loss			—			—			—			—			—			(1,099	)		(1,099	)
Balance at October 31, 2024			124,440,845			253,153			5,684			240			19,936			1,455			280,468

 

The accompanying notes are an integral part of these condensed interim consolidated financial statements

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	For the six months ended October 31,
	2024			2023
	($)			($)
Operating activities
Net income (loss) before tax for the period		(2,432	)		755
Adjustments for:
Depreciation		28			6
Depletion		30			—
Interest expense		9			2
Finance cost		312			—
Interest income		(368	)		(94	)
Share-based compensation		381			428
Net foreign exchange (gain) loss		401			(1,012	)
Other		—			(18	)
Net changes in non-cash working capital items:
Accounts receivable		13,777			—
Inventories		(33,796	)		(18,421	)
Prepaids and other receivables		272			333
Accounts payable and accrued liabilities		131			423
Other payables		(1,519	)		—
Cash used in operating activities		(22,774	)		(17,598	)
Investing activities
Investment in royalties		(11,584	)		—
Investment in short-term investments		(350	)		(769	)
Net proceeds from sale of short-term investments		—			30,070
Interest received		367			60
Cash generated from (used in) investing activities		(11,567	)		29,361
Financing activities
Proceeds from public offering, net of underwriters' fees and issuance costs		—			38,219
Proceeds from At-the-Market offering, net of agents' fees and issuance costs		—			3,446
Proceeds from common shares issued upon exercise of warrants and options		7,743			3,079
Proceeds from share issuance obligation		240			—
Net proceeds from finance payable		18,019			—
Net repayment of margin loan		—			(9,559	)
Repayment of government loan		—			(30	)
Payment of lease liability		(31	)		(7	)
Interest and fees paid		—			(167	)
Cash generated from financing activities		25,971			34,981
Effect of exchange rate changes on cash		201			1,012
Net increase (decrease) in cash		(8,169	)		47,756
Cash
Beginning of period		21,100			14,306
End of period		12,931			62,062

 

The accompanying notes are an integral part of these condensed interim consolidated financial statements

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1. Corporate Information

 

Uranium Royalty Corp. ("URC" or "the Company") is a company incorporated in Canada on April 21, 2017 and domiciled in Canada. URC is principally engaged in acquiring and assembling a portfolio of royalties, investing in companies with exposure to uranium and physical uranium. The Company also engages in the purchase and sale of physical uranium from time to time. The registered office of the Company is located at 1000 Cathedral Place, 925 West Georgia Street, Vancouver, British Columbia, V6C 3L2, Canada. The principal address of the Company is 1188 West Georgia Street, Suite 1830, Vancouver, British Columbia, V6E 4A2, Canada.

 

The Company is listed on the Toronto Stock Exchange (the "TSX"). The Company's common shares and common share purchase warrants, each of which is exercisable into one common share at an exercise price of $2.00 per share until December 6, 2024, are listed on the TSX under the symbols "URC" and "URC.WT", respectively. The Company's common shares are traded on the NASDAQ Capital Market under the symbol "UROY".

 

2. Basis of Preparation and Material Accounting Policies

2.1 Statement of compliance

The Company's condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IFRS"), applicable to the preparation of interim financial statements including International Accounting Standard 34 Interim Financial Reporting. The condensed interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements for the year ended April 30, 2024.

These condensed interim consolidated financial statements were authorized for issue by the Company's board of directors on December 12, 2024.

2.2 Basis of presentation

The Company's condensed interim consolidated financial statements have been prepared on a historical cost basis except for financial instruments that have been measured at fair value. The Company's condensed interim consolidated financial statements are presented in thousands of Canadian dollars ("$" or "dollars") which is also the functional currency of URC. All values are rounded to the nearest thousand except where otherwise indicated.

The accounting policies applied in the preparation of these condensed interim consolidated financial statements are consistent with those applied and disclosed in the Company's annual consolidated financial statements for the year ended April 30, 2024. The Company's interim results are not necessarily indicative of its results for a full year.

2.3 Basis of consolidation

The condensed interim consolidated financial statements include the financial statements of Uranium Royalty Corp. and its wholly-owned subsidiaries, being Uranium Royalty (USA) Corp. ("URUSA") and Reserve Minerals, LLC ("RM"). Subsidiaries are consolidated from the date the Company obtains control, and continue to be consolidated until the date that control ceases. Control is achieved when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

 

All inter-company transactions, balances, income and expenses are eliminated through the consolidation process.

The accounts of URUSA and RM are prepared for the same reporting period as the parent company, using consistent accounting policies. The functional currency of URUSA and RM is the United States dollar. Foreign operations are translated into Canadian dollars using the period end exchange rate as to assets and liabilities and the average exchange rate as to income and expenses. All resulting exchange differences are recognized in other comprehensive income.

 

 

 

 

 

 

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3. IFRS Pronouncement

 

3.1 Adoption of New Accounting Standards, Interpretation or Amendments

 

Amendments to IAS 1 - Presentation of Financial Statements

 

The amendments to IAS 1 clarifies certain requirements for determining whether a liability should be classified as current or non-current and requires new disclosures for non-current liabilities that are subject to covenants within 12 months after the reporting date. The amendments are effective for annual periods beginning on or after January 1, 2024, and are required to be applied retrospectively. The amendment requires the classification of liabilities as current or non-current depending on the rights existing at the end of the reporting period and clarifies that management's expectations in respect of settlement do not affect classification. Liabilities are classified as noncurrent if the company has a substantive right to defer settlement for at least twelve months at the end of the reporting period. 'Settlement' is defined as the extinguishment of a liability with cash, other economic resources, or an entity's own equity instruments. There is an exception for convertible instruments that might be converted into equity, but only for those instruments where the conversion option is classified as an equity instrument as a separate component of a compound financial instrument. The adoption of these amendments on May 1, 2024 did not have a material impact on the Company's consolidated financial statements.

 

3.2 New Accounting Standards Issued but not effective

 

Amendments to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments

 

The International Accounting Standards Board has issued classification and measurement and disclosure amendments to IFRS 9 and IFRS 7 which are effective for years beginning on or after January 1, 2026 with earlier application permitted. The amendments clarify the date of recognition and derecognition of some financial assets and liabilities and introduce a new exception for some financial liabilities settled through an electronic payment system. Other changes include a clarification of the requirements when assessing whether a financial asset meets the solely payments of principal and interest criteria and new disclosures for certain instruments with contractual terms that can change cash flows (including instruments where cash flow changes are linked to environmental, social or governance targets). The Company is currently assessing the impact of this amendment on the Company's consolidated financial statements.

 

IFRS 18, Presentation and Disclosure in Financial Statements

 

IFRS 18 is a new standard that will provide new presentation and disclosure requirements and which will replace IAS 1, Presentation of Financial Statements. IFRS 18 introduces changes to the structure of the income statement; provides required disclosures in financial statements for certain profit or loss performance measures that are reported outside an entity's financial statements; and provides enhanced principles on aggregation and disaggregation in financial statements. Many other existing principles in IAS 1 have been maintained. IFRS 18 is effective for years beginning on or after January 1, 2027, with earlier application permitted. The Company is currently assessing the impact of this amendment on the Company's consolidated financial statements.

 

4. Cash and Restricted Cash

 

As at October 31, 2024, the Company held cash of $12,931 (April 30, 2024: $21,100). In addition, the Company held restricted cash of $110 (April 30, 2024: $110). Restricted cash held at October 31, 2024 relates to security for a corporate credit card.

5. Short-term Investments

 

		As at October 31, 2024				As at April 30, 2024
		($)				($)
Fair value, at the beginning of the period/year			9,143				38,340
Additions for the period/year			350				936
Disposals for the period/year			—				(45,386	)
Fair value adjustment due to foreign exchange rate change for the period/year			—				(79	)
Fair value adjustment due to share price change for the period/year			(1,499	)			15,332
Fair value, at the end of the period/year			7,994				9,143

 

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5. Short-term Investments (continued)

 

As at October 31, 2024, the fair value of the Company's investment in Queen's Road Capital Investment Ltd. ("QRC") is $7,994 (April 30, 2024: $9,143).

 

The common shares of QRC are listed on the TSX. During the three and six months ended October 31, 2024, the Company recognized a change in fair value in short-term investments of $178 and $1,499 (2023: $8,521 and $12,542) and deferred income tax recovery of $32 and $154 (2023: deferred income tax expense of $1,150 and $1,693) in other comprehensive income.

 

6. Inventories

As at October 31, 2024, the Company holds 2,761,271 pounds triuranium octoxide ("U3O8") (April 30, 2024: 2,511,271 pounds U3O8). The carrying value of $221,176 (April 30, 2024: $187,090) includes the Company's entitlement of the uranium production from the McArthur River mine for the Company's royalty in-kind.

Pursuant to an agreement between Yellow Cake plc ("Yellow Cake") and the Company, Yellow Cake granted the Company an option to acquire at market between US$2.5 million and US$10 million U3O8 per year between January 1, 2019 and January 1, 2028, up to a maximum aggregate amount of US$21.25 million worth of U3O8 as at October 31, 2024. Yellow Cake has also agreed to inform the Company of any opportunities for royalties, streams or similar interests identified by Yellow Cake with respect to uranium and the Company has an irrevocable option to elect to acquire up to 50% of any such opportunity alongside Yellow Cake, in which case the parties shall work together in good faith to pursue any such opportunities jointly. Furthermore, the Company and Yellow Cake have agreed to, so far as it is commercially reasonable to do so, cooperate to identify potential opportunities to work together on other uranium related joint participation endeavors. No purchases occurred under this arrangement during the three and six months ended October 31, 2024.

 

7. Royalties

		($)
Balance, as at April 30, 2023			46,864
Depletion			(231	)
Foreign currency translation			417
Balance, as at October 31, 2023			47,050
Additions			75
Depletion			(228	)
Foreign currency translation			(126	)
Balance, as at April 30, 2024			46,771
Additions			11,584
Depletion			(319	)
Foreign currency translation			246
Balance, as at October 31, 2024			58,282

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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7. Royalties (continued)

		Cost																Accumulated Depletion												Carrying Amount
		April 30, 2024				Additions				Foreign Currency Translation				October 31, 2024				April 30, 2024				Depletion				October 31, 2024				October 31, 2024
		($)				($)				($)				($)				($)				($)				($)				($)
Anderson project			7,880				—				88				7,968				—				—				—				7,968
Churchrock project			805				4,878				55				5,738				—				—				—				5,738
Cigar Lake project			4,704				—				—				4,704				—				—				—				4,704
Dawn Lake project			282				—				—				282				—				—				—				282
Dewey-Burdock project			1,469				—				17				1,486				—				—				—				1,486
Energy Queen project			69				—				1				70				—				—				—				70
Lance project			1,811				—				20				1,831				—				—				—				1,831
Langer Heinrich project			2,822				—				—				2,822				—				(30	)			(30	)			2,792
McArthur River project			11,543				—				—				11,543				(606	)			(289	)			(895	)			10,648
Michelin project			4,262				—				—				4,262				—				—				—				4,262
Millennium and Cree Extension project			—				6,024				—				6,024				—				—				—				6,024
Reno Creek project			310				—				4				314				—				—				—				314
Roca Honda project			170				—				2				172				—				—				—				172
Roughrider, Russell Lake and Russell Lake South projects			5,998				—				—				5,998				—				—				—				5,998
Salamanca Project			—				682				—				682				—				—				—				682
San Rafael project			555				—				6				561				—				—				—				561
Slick Rock project			3,127				—				35				3,162				—				—				—				3,162
Whirlwind project			69				—				1				70				—				—				—				70
Workman Creek project			1,501				—				17				1,518				—				—				—				1,518
			47,377				11,584				246				59,207				(606	)			(319	)			(925	)			58,282

 

The Company's royalties are detailed below:

 

Anderson, Slick Rock and Workman Creek Projects

 

The Company holds a 1% net smelter return royalty for uranium on Anderson project, Slick Rock project, and Workman Creek project in the USA.

 

Cigar Lake, McArthur River and Dawn Lake Projects

 

The Company holds (i) a 1% gross overriding royalty on an approximate 9% share of uranium production derived from an approximate 30.195% ownership interest of Orano Canada Inc. ("Orano") on the McArthur River project located in Saskatchewan, Canada; (ii) a 10% to 20% sliding scale net profit interest ("NPI") royalty on a 3.75% share of overall uranium production, drawn from Orano's approximate 40.453% ownership interest in the Waterbury Lake / Cigar Lake project (the "Cigar Lake Project") located in Saskatchewan, Canada, and (iii) a 10% to 20% sliding scale NPI royalty on a 7.5% share of overall uranium production from the Dawn Lake project located in Saskatchewan, Canada. The sliding scale NPI royalty on the Cigar Lake Project and the Dawn Lake project will decrease to 10% after the combined production on the Cigar Lake and Dawn Lake projects reach 200 million pounds U3O8.

The Company has elected to receive royalty proceeds from the McArthur River mine through delivery of physical uranium. As a result, the Company recorded a depletion of $157 and $289 (2023: $86 and $231) on the McArthur River royalty and an increase in inventory by the same amount during the three and six months ended October 31, 2024.

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7. Royalties (continued)

 

Churchrock Project

 

During the six months ended October 31, 2024, the Company acquired an additional royalty on a portion of the Churchrock uranium project. The royalty is structured as a gross overriding royalty of 6% "Mine Price", which anticipates recovery of reasonable and actual costs to transport the mineral to the final point of sale. The acquisition cost of $4,878 was paid in cash. As at October 31, 2024, the Company holds a 4% net smelter return royalty on the entire Churchrock property and a 6% gross overriding royalty on a portion of the Churchrock property in the USA.

 

Dewey-Burdock Project

 

The Company holds a 30% net proceeds royalty and a 2% to 4% gross value royalty on a portion of the Dewey-Burdock property in the USA.

 

Energy Queen, San Rafael and Whirlwind Projects

 

The Company holds a 1% gross value royalty on portions of the Energy Queen project, a 2% net smelter return royalty on portions of the San Rafael project and a 2% to 4% sliding scale gross value royalty on portions of the Whirlwind project in the USA. The Company may choose to take product payment in physical ore or concentrates produced from the Energy Queen and Whirlwind projects.

 

Lance Project

 

The Company holds a 4% gross revenues royalty on a portion of the Lance property and an additional 1% gross revenues royalty which covers the entirety of the current permitted project area in the USA.

 

Langer Heinrich Project

 

The Company holds a production royalty of Australian $0.12 per kilogram of yellow cake produced from the Langer Heinrich uranium project in Namibia.

 

Michelin Project

 

The Company holds a 2% gross revenues royalty on the Michelin property in Canada.

 

Millennium and Cree Extension Projects

 

During the six months ended October 31, 2024, the Company acquired a 10% NPI royalty on an approximate 20.6955% participating interest in the Millennium and Cree Extension projects in Saskatchewan, Canada. As a profit-based NPI interest, the acquired royalty is calculated based upon generated revenue, with deductions for certain expenses and costs, which include cumulative expense accounts, including development costs. The acquisition cost of $6,024 was paid in cash.

 

Reno Creek Project

 

The Company holds a 0.5% net profit interest royalty, with a maximum amount payable thereunder of US$2.5 million, on a portion of the Reno Creek property in the USA.

 

Roca Honda Project

 

The Company holds a 4% gross revenues royalty on a portion of the Roca Honda property in the USA. The royalty is subject to the right of the payor to purchase the royalty for US$5 million at any time prior to the first royalty payment becoming due thereunder.

 

Roughrider, Russell Lake and Russell Lake South Projects

The Company holds a 1.98% net smelter return royalty on the Roughrider, Russell Lake and Russell Lake South properties in Canada. The royalties on the Roughrider, Russell Lake and Russell Lake South projects are represented by the same royalty instrument.

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7. Royalties (continued)

 

Salamanca Project

 

During the six months ended October 31, 2024, the Company acquired a 0.375% net smelter return royalty on the Salamanca project, including the Retortillo, Zona 7 and Alameda projects, located in Spain. The acquisition cost of $682 was paid in cash.

 

8. Finance Payable

 

In August 2024, the Company entered into a physical uranium sale and repurchase arrangement with a third party, in which the Company sold 160,000 pounds U3O8 to in August 2024 and will repurchase 160,000 pounds U3O8 in December 2024. Due to the nature of the transaction being treated as a sale and repurchase arrangement, the cash sales proceeds was recognized as a finance payable as at October 31, 2024. The finance payable is subject to an annual effective interest rate of 6.8%, which is based on the amortization of the finance cost over the life of the financing arrangement. The delivery and payment for the purchase of 160,000 pounds U3O8 is due in December 2024, at which time the financing arrangement will be extinguished.

 

The following outlines the movement of the financing arrangement:

 

		US$'000				$
Balance, as at July 31, 2024			—				—
Principal			13,360				18,019
Finance cost			228				312
Unrealized foreign exchange loss			—				602
Balance, as at October 31, 2024			13,588				18,933

 

9. Issued Capital

9.1 Common Shares

The authorized share capital of the Company is comprised of an unlimited number of common shares and an unlimited number of preferred shares issuable in series without par value.

At-the-Market Equity Program

 

On August 8, 2023, the Company entered into an equity distribution agreement (the "2023 Distribution Agreement") with a syndicate of agents for an at-the-market equity program (the "ATM Program"). The 2023 Distribution Agreement allowed the Company to distribute up to US$40 million (or the equivalent in Canadian dollars) of common shares of the Company (the "ATM Shares") to the public from time to time, through the agents, at the Company's discretion. The ATM Shares sold under the ATM Program, were sold at the prevailing market price at the time of sale. The 2023 Distribution Agreement was terminated on September 1, 2024.

 

On August 29, 2024, the Company renewed its ATM Program that allows the Company to distribute up to US$39 million (or the equivalent in Canadian dollars) of ATM Shares to the public from time to time, through the agents, at the Company's discretion. The ATM Shares sold under the ATM Program, if any, will be sold at the prevailing market price at the time of sale. Sales of ATM Shares will be made pursuant to the terms of an equity distribution agreement dated August 29, 2024 (the "2024 Distribution Agreement"). All sales under the ATM Program following August 29, 2024 are made under the 2024 Distribution Agreement. Unless earlier terminated by the Company or the agents as permitted therein, the 2024 Distribution Agreement will terminate upon the earlier of (a) the date that the aggregate gross sales proceeds of the ATM Shares sold under the ATM Program reaches the aggregate amount of US$39 million (or the equivalent in Canadian dollars); or (b) August 20, 2025.

 

No ATM shares were distributed by the Company during the three and six months ended October 31, 2024.

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9. Issued Capital (continued)

 

9.2 Reserves

Common Share Purchase Warrants and Options

The following outlines the movements of the Company’s warrants and share options:

 

		Warrants				Share Options				Total
		($)				($)				($)
Balance, as at April 30, 2023			4,382				1,937				6,319
Common shares issued upon exercise of warrants			(386	)			—				(386	)
Share-based compensation			—				428				428
Balance, as at October 31, 2023			3,996				2,365				6,361
Common shares issued upon exercise of warrants			(355	)			—				(355	)
Share-based compensation			—				310				310
Balance, as at April 30, 2024			3,641				2,675				6,316
Common shares issued upon exercise of warrants			(985	)			—				(985	)
Common shares issued upon exercise of options			—				(28	)			(28	)
Share-based compensation			—				381				381
Balance, as at October 31, 2024			2,656				3,028				5,684

During the six months ended October 31, 2024, 3,868,762 common share purchase warrants were exercised. As at October 31, 2024, the Company has a share issuance obligation of $240, which was settled subsequent to the period end upon the issuance of common shares from the exercise of warrants.

As at October 31, 2024, there are 10,575,092 warrants outstanding at an exercise price of $2.00 per share.

Share Options

 

The following outlines movements of the Company's share options:

 

		Number of options				Weighted Average  Exercise Price  ($)
Balance at April 30, 2024			1,697,300				3.36
Granted			391,500				3.92
Exercised			(17,750	)			3.48
Balance at October 31, 2024			2,071,050				3.47

On October 17, 2024 and October 29, 2024, the Company granted 374,500 and 17,000 share options at an exercise price of $3.92 per share and $4.00 per share to certain directors, officers, employees and consultants of the Company, respectively. These options are valid for a period of five years. The options will vest as follows: (a) 25% on the grant date; and (b) 25% on each of the dates that are 6, 12 and 18 months thereafter.

The weighted average fair value of the share options granted was $2.12 per share and it was estimated at the date of grants using the Black-Scholes option pricing model with the following weighted average assumptions:

 

Risk-free interest rate		2.94	%
Expected life (years)		4.00
Expected volatility		69.19	%
Expected dividend yield		0.00	%
Estimated forfeiture rate		3.51	%

 

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9. Issued Capital (continued)

9.2 Reserves (continued)

Share Options (continued)

 

A summary of share options outstanding and exercisable at October 31, 2024, are as follows:

 

				Options Outstanding												Options Exercisable
Exercise Price ($)				Number of Options Outstanding				Weighted Average Exercise Price ($)				Weighted Average Remaining Contractual Life (years)				Number of Options Exercisable				Weighted Average Exercise Price ($)				Weighted Average Remaining Contractual Life (years)
	5.46				40,000				5.46				1.87				40,000				5.46				1.87
	4.93				5,000				4.93				2.20				5,000				4.93				2.20
	4.20				1,000				4.20				2.86				1,000				4.20				2.86
	4.10				50,000				4.10				1.58				50,000				4.10				1.58
	4.00				17,000				4.00				5.00				4,250				4.00				5.00
	3.92				374,500				3.92				4.96				93,625				3.92				4.96
	3.76				50,000				3.76				2.02				37,500				3.76				2.02
	3.49				595,000				3.49				1.58				595,000				3.49				1.58
	3.31				100,000				3.31				0.53				100,000				3.31				0.53
	3.31				332,500				3.31				2.53				332,500				3.31				2.53
	3.30				32,500				3.30				3.83				24,375				3.30				3.83
	3.26				25,000				3.26				2.64				25,000				3.26				2.64
	3.15				5,000				3.15				2.98				5,000				3.15				2.98
	2.92				418,550				2.92				3.81				313,850				2.92				3.81
	2.88				25,000				2.88				2.68				25,000				2.88				2.68
					2,071,050			$	3.47				2.85				1,652,100			$	3.42				2.42

 

The amount of share-based compensation expense recognized during the three and six months ended October 31, 2024 was $292 (2023: $381) and $381 (2023: $428), respectively.

9.3 Earnings (Loss) Per Share

For the three and six months ended October 31, 2024, the Company's outstanding warrants and stock options were not included in the calculation of diluted loss per share as they were anti-dilutive.

 

		For the three months ended October 31,						For the six months ended October 31,
		2024			2023			2024			2023
		($)			($)			($)			($)
Net income (loss) for the period			(428	)		3,490			(2,586	)		2,448
Basic weighted average number of shares			121,970,820			102,699,912			121,393,943			101,353,526
Basic earnings (loss) per share		(0.00)				0.03			(0.02	)		0.02
Effect of dilutive securities
Warrants			—			7,064,565			—			5,965,549
Stock options			—			100,307			—			11,695
Diluted weighted average number of common shares			121,970,820			109,864,784			121,393,943			107,330,770
Diluted earnings (loss) per share		(0.00)				0.03			(0.02	)		0.02

 

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10. Office and Administration Expenses

The following outlines the amounts included in office and administration expenses for the three and six months ended October 31, 2024 and 2023:

 

	For the three months ended October 31,						For the six months ended October 31,
	2024			2023			2024			2023
	($)			($)			($)			($)
Corporate administrative costs		306			235			401			334
Investor communications and marketing expenses		773			1,393			1,667			1,504
Uranium storage fees		390			161			781			335
Total		1,469			1,789			2,849			2,173

 

11. Financial Instruments

At October 31, 2024, the Company's financial assets include cash, restricted cash, accounts receivable and short-term investments. The Company's financial liabilities include accounts payable and accrued liabilities, finance payable and lease liability. The Company uses the following hierarchy for determining and disclosing fair value of financial instruments:

The Company's cash, restricted cash, accounts receivable, and accounts payable and accrued liabilities approximate fair value due to their short terms to settlement. The fair value of short-term investments, which are classified as level 1 within the fair value hierarchy, is determined by obtaining the quoted market price of the short-term investment and multiplying it by foreign exchange rate, if applicable, and the quantity of shares held by the Company. Finance payable and lease liability are measured at amortized cost. The fair value of the finance payable and lease liability approximate their carrying values as their interest rates are comparable to current market rates.

11.1 Financial risk management objectives and policies

The financial risk arising from the Company's operations are credit risk, liquidity risk, commodity price risk, currency risk and other price risk. These risks arise from the normal course of operations and all transactions undertaken are to support the Company's ability to continue as a going concern. The risks associated with these financial instruments and the policies on how the Company mitigates these risks are set out below. Management manages and monitors these exposures to ensure appropriate measures are implemented in a timely and effective manner.

11.2 Credit risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. Credit risk for the Company is primarily associated with the Company's bank balances and accounts receivable. The Company holds cash with Canadian chartered financial institutions of which the majority of its bank balances are uninsured as at October 31, 2024. The Company's maximum exposure to credit risk is equivalent to the carrying value of its cash and restricted cash balance. In order to mitigate its exposure to credit risk, the Company monitors its financial assets and maintains its cash deposits in several Schedule I chartered banks in Canada.

11.3 Liquidity risk

Liquidity risk is the risk that the Company will not be able to settle or manage its obligations associated with financial liabilities. To manage liquidity risk, the Company closely monitors its liquidity position and ensures it has adequate sources of funding to finance its projects and operations. The Company believes that, taking into account its current cash reserves and other liquid assets, it has sufficient working capital for its present obligations for at least the next twelve months commencing from October 31, 2024.

 

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11. Financial Instruments (continued)

11.3 Liquidity risk (continued)

The Company's working capital (current assets less current liabilities) as at October 31, 2024 was $222,152. The Company's accounts payable and accrued liabilities and finance payable are expected to be realized or settled within a one-year period.

11.4 Commodity price risk

The recoverability of the Company's physical uranium inventories is subject to changes in uranium prices. In addition, the Company's future profitability will be dependent on the royalty income to be received from mine operators. Royalties are based on a percentage of the minerals or the products produced, or revenue or profits generated from the property which is typically dependent on the prices of the minerals the property operators are able to realize. Mineral prices are affected by numerous factors such as interest rates, exchange rates, inflation or deflation and global and regional supply and demand.

11.5 Currency risk

Financial instruments that impact the Company's net income due to currency fluctuations include cash and finance payable denominated in U.S. dollars. The impact of a Canadian dollar change against U.S. dollars on cash and finance payable by 1% would have an impact of approximately $86 and $189, respectively, on net loss for the six months ended October 31, 2024.

11.6 Other price risk

The Company is exposed to equity price risk as a result of investing in other mining companies. The equity prices of these investments are impacted by various underlying factors including commodity prices. Based on the Company's short-term investments held as at October 31, 2024, a 10% change in the equity prices of these investments would have an impact, net of tax, of approximately $656 on other comprehensive income.

 

12. Related Party Transactions

12.1 Related Party Transactions

Related party transactions are based on the amounts agreed to by the parties. During the three and six months ended October 31, 2024 and 2023, the Company did not enter into any material contracts or undertake any significant commitment or obligation with any related parties other than as described herein and elsewhere in these financial statements.

12.2 Transactions with Key Management Personnel

Key management personnel are persons responsible for planning, directing and controlling the activities of an entity.

The remuneration of directors and key management, for the three and six months ended October 31, 2024 and 2023, comprised of:

 

		For the three months ended October 31,								For the six months ended October 31,
		2024				2023				2024				2023
		($)				($)				($)				($)
Management salaries			97				96				194				190
Directors’ fees			47				51				93				103
Share-based compensation			195				227				243				253
Total			339				374				530				546

 

13. Operating Segments

The Company conducts its business as a single operating segment, being the acquiring and assembling a portfolio of royalties, investing in companies with exposure to uranium and physical uranium. The Company also engages in the purchase and sale of physical uranium from time to time. Except for the royalties on uranium projects located in the USA, Namibia and Spain, substantially all of the Company's assets and liabilities are held within Canada.

 

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13. Operating Segments (continued)

 

13.1 Sales of Uranium Inventory

 

Sales of uranium inventory for the three and six months ended October 31, 2024 and 2023 were all generated in Canada.

 

13.2 Major Customers

 

Revenue from sales of uranium inventory from major customers for the three and six months ended October 31, 2024 and 2023 are summarized as follows:

 

		For the three months ended October 31,								For the six months ended October 31,
		2024				2023				2024				2023
		($)				($)				($)				($)
Customer A			10,862				—				10,862				—
Customer B			—				15,318				—				15,318
Total			10,862				15,318				10,862				15,318

 

14. Commitments

 

On November 17, 2021, as amended on June 11, 2024, the Company entered into agreements with CGN Global Uranium Ltd ("CGN"), pursuant to which the Company agreed to purchase an aggregate 500,000 pounds U3O8 at a weighted average price of US$47.71 per pound, of which an aggregate of 400,000 pounds U3O8 were delivered as at October 31, 2024. The delivery of the remaining 100,000 pounds U3O8 for approximately $6.8 million is required in April 2025.

15. Subsequent Events

 

Other than as disclosed elsewhere in these condensed interim consolidated financial statements, the following material events occurred subsequent to October 31, 2024:

Approximately 9.2 million warrants were exercised for gross proceeds of $18 million and approximately 1.4 million unexercised warrants expired on December 6, 2024.

 

 

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Exhibit 99.2

 

 

 

 

 

 

 

 

MANAGEMENT’S DISCUSSION AND ANALYSIS

FOR THE THREE AND SIX MONTHS ENDED OCTOBER 31, 2024

(Expressed in Canadian Dollars unless otherwise stated)

December 12, 2024

 

 

 

 

 

 

 

 

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General

This management's discussion and analysis ("MD&A") of the financial condition and results of operations of Uranium Royalty Corp. should be read in conjunction with its unaudited condensed interim consolidated financial statements and the notes thereto for the three and six months ended October 31, 2024, and its Annual Information Form (the "AIF") and audited consolidated financial statements, including the notes thereto for the year ended April 30, 2024, copies of which are available under its profile on SEDAR+ at www.sedarplus.ca.

The Company's condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IFRS"), applicable to the preparation of interim financial statements including International Accounting Standard 34 Interim Financial Reporting. Unless otherwise stated, all information contained in this MD&A is as of December 12, 2024.

 

Unless otherwise stated, references herein to "$" or "dollars" are to Canadian dollars, references to "US$" are to United States dollars and references to "A$" are to Australian dollars. References in this MD&A to the "Company" and "URC" mean Uranium Royalty Corp., together with its subsidiaries, unless the context otherwise requires.

 

References herein to "U3O8" are to triuranium octoxide, a compound of uranium that is converted to uranium hexafluoride for the purpose of uranium enrichment.

Forward-looking Statements

 

Certain statements contained in this MD&A constitute "forward-looking information" within the meaning of Canadian securities laws and "forward-looking statements" within the meaning of securities laws in the United States (collectively, "Forward-Looking Statements"). These statements relate to the expectations of management about future events, results of operations and the Company's future performance (both operational and financial) and business prospects. All statements other than statements of historical fact are Forward-Looking Statements. The use of any of the words "anticipate", "plan", "contemplate", "continue", "estimate", "expect", "intend", "propose", "might", "may", "will", "shall", "project", "should", "could", "would", "believe", "predict", "forecast", "target", "aim", "pursue", "potential", "objective" and "capable" and the negative of these terms or other similar expressions are generally indicative of Forward-Looking Statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such Forward-Looking Statements. No assurance can be given that these expectations will prove to be correct and such Forward-Looking Statements should not be unduly relied on. These statements speak only as of the date hereof. In addition, this MD&A may contain Forward-Looking Statements attributed to third party industry sources. Without limitation, this MD&A contains Forward-Looking Statements pertaining to the following:

 

• the ongoing operation of the properties in which the Company holds or may hold uranium interests; • future events or performance; • the impact of general business and economic conditions; • future financial capacity, liquidity and capital resources; • anticipated future sources of funds to meet working capital requirements; • future capital expenditures and contractual commitments; • expectations respecting future financial results; • expectations with respect to the Company's financial position; • expectations regarding uranium prices and the impacts of the United States and other governmental policies on uranium demand;

• expectations regarding supply and demand for uranium; • conditions, trends and practices pertaining to the uranium industry and other industries in which uranium is used; • expectations regarding the Company's business plans, strategies, growth and results of operations; • the financial and operational strength of counterparties; • production volumes; • mineral resources and mine life; and • governmental regulatory regimes with respect to environmental matters.

 

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With respect to Forward-Looking Statements contained in this MD&A, assumptions have been made regarding, among other things, the following:

 

• market prices of uranium; • global economic and financial conditions; • demand for uranium; • uranium supply; • industry conditions; • the ongoing operation of the properties in which the Company holds or may hold uranium interests;	• future operations and developments on the properties in which the Company holds or may hold interests; and • the accuracy of public statements and disclosure, including future plans and expectations, made by the owners or operators of the properties underlying the Company's interests.

 

Actual results could differ materially from those anticipated in these Forward-Looking Statements as a result of, among other things, the risk factors set forth below and included elsewhere in this MD&A:

 

• limited or no access to data or the operations underlying the Company's interests; • dependence on third party operators; • risks related to political unrest in Kazakhstan, which could negatively impact the Company's option to purchase uranium from Yellow Cake plc ("Yellow Cake"); • dependence on future payments from owners and operators; • a majority of the Company's assets are non-producing; • royalties, streams and similar interests may not be honoured by operators of a project; • defects in or disputes relating to the existence, validity, enforceability, terms and geographic extent of royalties, streams and similar interests; • royalty, stream and similar interests may be subject to buy-down right provisions or pre-emptive rights; • project costs may influence the Company's future royalty returns; • risks faced by owners and operators of the properties underlying the Company's interests; • title, permit or licensing disputes related to any of the properties in which the Company holds or may hold royalties, streams or similar interests; • excessive cost escalation, as well as development, permitting, infrastructure, operating or technical difficulties on any of the properties underlying royalties, streams or similar interests; • compliance with laws and regulations relating to environmental, social and governance matters; • macroeconomic developments and changes in global general economic, financial, market and business conditions; • fluctuations in the market prices of the Company's investments; • liquidity in equity investments; • fluctuations in the foreign exchange rate; • any inability to attract and retain key employees; • disruptions to the information technology systems of the Company or third-party service providers;

• volatility in market prices and demand for uranium and the market price of the Company's other investments, including as a result of geopolitical factors such as the ongoing conflict in Ukraine; • changes in general economic, financial, market and business conditions in the industries in which uranium is used; • risks related to mineral reserve and mineral resource estimates; • replacement of depleted mineral reserve; • the public acceptance of nuclear energy in relation to other energy sources; • alternatives to and changing demand for uranium; • the absence of any public market for uranium; • changes in legislation, including permitting and licensing regimes and taxation policies; • the effects of the spread of illness or other public health emergencies; • commodities price risks, which may affect revenue derived by the Company from its asset portfolio; • risks associated with future acquisitions; • competition and pricing pressures; • any inability of the Company to obtain necessary financing when required on acceptable terms or at all; • regulations and political or economic developments in any of the jurisdictions where properties in which the Company holds or may hold royalties, streams or similar interests are located; • litigation; • risks associated with First Nations land claims; • potential conflicts of interests; • any inability to ensure compliance with anti-bribery and anti-corruption laws; • any future expansion of the Company's business activities outside areas of expertise; • any failure to maintain effective internal controls; • negative cash flow from operating activities; and • the other risks described under "Risk Factors" in the AIF and other filings with the Canadian Regulatory Authorities, copies of which are available under its profile at SEDAR+.

 

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Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in Forward-Looking Statements. Forward-Looking Statements are based on management's beliefs, estimates and opinions on the date the statements are made and the Company undertakes no obligation to update Forward-Looking Statements if these beliefs, estimates and opinions or other circumstances should change, other than as required by applicable laws. Investors are cautioned against attributing undue certainty to Forward-looking Statements.

 

The risk factors referenced herein should not be construed as exhaustive. Except as required under applicable laws, the Company undertakes no obligation to update or revise any Forward-Looking Statements. An investment in the Company is speculative and involves a high degree of risk due to the nature of our business and the present state of exploration of our projects.

Please carefully consider the risk factors set out herein under "Risk Factors" noted above.

Notice Regarding Mineral Disclosure

This MD&A has been prepared in accordance with the requirements of Canadian securities laws, which differ from the requirements of United States securities laws. Unless otherwise indicated, all mineral reserve and resource estimates included herein have been prepared for or by the current or former owners and operators of the relevant properties, as and to the extent indicated by them, in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects ("NI 43-101") and the CIM Definition Standards on Mineral Resources and Reserves as adopted by the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM Definition Standards") or the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves ("JORC") or Subpart 1300 of Regulation S-K ("S-K 1300"), as applicable.

The United States Securities and Exchange Commission (the "SEC") has adopted mining disclosure rules under S-K 1300. As a foreign private issuer that is eligible to file reports with the SEC pursuant to the multi-jurisdictional disclosure system, the Company is not required to provide disclosure under S-K 1300. Under S-K 1300, the SEC now recognizes estimates of "measured mineral resources", "indicated mineral resources" and "inferred mineral resources". In addition, the SEC has amended its definitions of "proven mineral reserves" and "probable mineral reserves" to be substantially similar to the corresponding definitions under the CIM Definition Standards, as required under NI 43-101.

United States investors are cautioned that while terms are substantially similar to the CIM Definition Standards, there are differences in the definitions under S-K 1300 and the CIM Standards and there is no assurance any mineral reserves or mineral resources that the Company may report as "proven mineral reserves", "probable mineral reserves", "measured mineral resources", "indicated mineral resources" and "inferred mineral resources" under NI 43-101 would be the same had the Company prepared the reserve or resource estimates under the standards adopted under S-K 1300.

United States investors are also cautioned that while the SEC will now recognize "measured mineral resources", "indicated mineral resources" and "inferred mineral resources", investors should not assume that any part or all of the mineralization in these categories will ever be converted into a higher category of mineral resources or into mineral reserves. Mineralization described using these terms has a greater amount of uncertainty as to their existence and feasibility than mineralization that has been characterized as reserves. Accordingly, investors are cautioned not to assume that any "measured mineral resources", "indicated mineral resources", or "inferred mineral resources" that the Company reports are or will be economically or legally mineable. Further, "inferred resources" have a greater amount of uncertainty as to their existence and as to whether they can be mined legally or economically. In accordance with Canadian rules, estimates of "inferred mineral resources" cannot form the basis of feasibility or other economic studies, except in limited circumstances where permitted under NI 43-101. In addition, the project stage classifications utilized by the Company under NI 43-101 do not conform to defined project stages under S-K 1300.

 

Certain resource estimates disclosed in this MD&A and the Company's other disclosure documents, have been prepared in accordance with JORC, which differs from the requirements of NI 43-101 and S-K 1300. Accordingly, information contained herein may contain descriptions of the projects underlying the Company’s interests that differ from similar information made available by Canadian and United States issuers.

Third Party Market and Technical Information

 

This MD&A includes market information, industry data and forecasts obtained from independent industry publications, market research and analyst reports, surveys and other publicly available sources. Although the Company believes these sources to be generally reliable, market and industry data is subject to interpretation and cannot be verified with complete certainty due to limits on the availability and

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reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey. Accordingly, the accuracy and completeness of this data is not guaranteed. Actual outcomes may vary materially from those forecast in such reports, surveys or publications, and the prospect for material variation can be expected to increase as the length of the forecast period increases. The Company has not independently verified any of the data from third party sources referred to herein nor ascertained the underlying assumptions relied on by such sources.

Except where otherwise stated, the disclosure herein relating to properties underlying the Company's royalty and other interests is based primarily on information publicly disclosed by the owners or operators of such properties, as is customary for royalty portfolio companies of this nature. Specifically, as a royalty holder, the Company has limited, if any, access to the properties subject to its interests. The Company generally relies on publicly available information regarding these properties and related operations and generally has no ability to independently verify such information, and there can be no assurance that such third party information is complete and accurate. In addition, such publicly available information may relate to a larger property area than that covered by the Company's interests. Additionally, the Company has, and may from time to time, receive operating information from the owners and operators of these properties, which it is not permitted to disclose to the public.

Business Overview

 

URC is a pure-play uranium royalty company focused on gaining exposure to uranium prices by making strategic investments in uranium interests, including royalties, streams, debt and equity investments in uranium companies, as well as through holdings of physical uranium.

The Company's common shares without par value (the "Common Shares") are listed on the Toronto Stock Exchange (the "TSX") under the symbols "URC". The Common Shares are also listed on the Nasdaq Capital Market ("NASDAQ") under the stock symbol "UROY".

The head office and principal address of the Company is located at 1188 West Georgia Street, Suite 1830, Vancouver, British Columbia, V6E 4A2, Canada.

Business Strategy

 

To date, the Company has assembled a portfolio of royalty interests on uranium projects and physical uranium holdings. URC's long-term strategy is to gain exposure to uranium prices by owning and managing a portfolio of geographically diversified uranium interests, including uranium royalties and streams, debt and equity investments in uranium companies and physical uranium. The Company also engages in the purchase and sale of physical uranium from time to time. In executing this strategy, the Company seeks interests that provide it direct exposure to uranium prices, without the direct operating costs and concentrated risks that are associated with the exploration, development and mining of uranium. From time to time, the Company also seeks further exposure to uranium through investments in funds and other equities.

The Company's strategy recognizes the inherent cyclicality of valuations based on uranium prices, including the impact of such cyclicality on the availability of capital within the uranium sector. The Company intends to execute on its strategy by leveraging the deep industry knowledge and expertise of its management team and its board of directors to identify and evaluate opportunities in the uranium industry.

 

The Company's primary focus is to identify, evaluate and acquire:

Such interests may be acquired by the Company directly from the owner or operator of a project or indirectly from third-party holders. The Company may also seek to acquire direct joint ventures or other interests in existing uranium projects, where such interests would

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provide the Company with exposure to a project as a non-operator or where the Company believes there is potential to convert such interests into royalties, streams or similar interests. In evaluating potential transactions, the Company utilizes a disciplined approach to manage its fiscal profile.

The Company also engages in purchases and sales of uranium inventories from time to time. Purchases are made where the Company believes there is an opportunity to provide attractive commodity price exposure to shareholders. Sales may occur from time to time based upon market conditions and the Company's liquidity requirements. Purchases may be made pursuant to its existing option under its strategic arrangement with Yellow Cake or by other means, including direct purchases from producers or market purchases. See "Recent Developments".

 

Uranium Market Developments

 

The uranium market is currently being driven by a macro demand for more electricity generation and an unprecedented global push to decarbonize electrical grids, among other factors. New electricity demand projections outlined from the "US Data Center Power Outlook" report issued in July 2024 by Energy + Environmental Economics, predicted new data center demand growth ranging from 60 to 90 gigawatt ("GW") between 2023 and 2030. There is a growing realization that nuclear energy should be a part of any clean energy platform. Governments around the globe are also pursuing strategies to increase energy independence for national security interests that dovetail well with nuclear power as a key component in their energy mix. In the U.S. the White House recently announced "the United States will aim to deploy 200 GW of net new nuclear energy capacity by 2050, at least tripling current U.S. capacity. The net new capacity gains are anticipated to come from multiple sources, including building new nuclear power plants, uprating existing reactors, and restarting reactors that have retired for economic reasons" (Source: The White House News & Update, November 12, 2024).

 

Over the past few years, global uranium market fundamentals have improved as the market began a transition from being an inventory driven to a production driven market. The spot market bottomed out in November 2016 at about US$17.75 per pound U3O8, but has since shown appreciation, reaching US$107.00 per pound U3O8 on February 2, 2024 (Source: UxC LLC Historical Ux Daily Prices). Increases in uranium price in early 2024 were largely driven by anticipated legislative action that would ban the import of Russian nuclear fuel into the United States (Source: Tradetech Nuclear Market Review - April 30, 2024). Such legislation was enacted in the United States in May 2024. During the three and six months ended October 31, 2024, uranium prices averaged US$81.13 per pound and US$84.20 per pound U3O8, representing an approximate 25% and 40% increase compared to an average of US$64.76 per pound and US$60.03 per pound U3O8 in the corresponding period in 2023, respectively (Source: UxC LLC Historical Ux Daily Prices). As at October 31, 2024, the spot uranium price was US$80.00 per pound U3O8, representing an approximate 11% decrease from April 30, 2024 when the price was US$90.00 per pound U3O8 (Source:UxC LLC Historical Ux Daily Prices). The decrease in the spot uranium price during October was primarily due to a lack of spot buying interest and sellers lowered their offer prices to conclude transactions (Source: Tradetech Nuclear Market Review - October 31, 2024). The period from May 2024 through October 2024 was marked by continued spot price fluctuations between US$78.00 and US$93.85 per pound U3O8 (Source: UxC LLC Historical Ux Daily Prices).

 

Underinvestment in uranium mining operations over the past decade has been a major factor contributing to a structural deficit between global production and uranium requirements. Reduced production from existing uranium mines has also been a contributing factor with some large producers cutting back and/or unable to reach previously planned production levels. In 2024 and 2025, the mid-case gap between production and requirements is projected to be more than 58 million pounds of U3O8, and by 2034 accumulates to a total above 355 million pounds of U3O8 (Source: UxC 2024 Q3 Uranium Market Outlook). For context, utilities in the United States purchased 51.6 million pounds of U3O8 in 2023 (Source: U.S. Energy Information Administration, June 6, 2024 - Uranium Marketing Annual Report). The current gap is being filled with secondary market sources, including finite inventory that has been declining and is projected to decline further in coming years. Secondary supply is also likely to be further reduced with western enrichers reversing operations from underfeeding to overfeeding, which requires more uranium to increase the production of enrichment services. As secondary supplies continue to diminish, and as existing mines deplete resources, it is expected that new production will be needed to meet existing and future utility demand. The timeline for new mining projects can be ten years or longer and will require prices high enough to stimulate new mining investments.

 

Since 2022, uranium supply has become more complicated due to Russia's invasion of Ukraine with its State Atomic Energy Corporation, Rosatom, being a significant supplier of nuclear fuel around the globe. Economic sanctions, transportation restrictions and recent legislation banning the importation of Russian nuclear fuel is causing a fundamental change to the nuclear fuel markets. Additionally, the 2023 coup in Niger, and the new government's demand for the United States and France to vacate the country, as well the revocation of Canadian and French companies mining rights and operating permits has underscored jurisdictional risk. Niger is the world's seventh largest producer and accounted for about 5% of global uranium production and about 14% of European Union supply in 2023 (Source: Euratom Supply Agency, World Nuclear Association - Uranium in Niger July 23, 2024, World Nuclear News). As a

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result of the instability and assurance of supply risks, United States and European utilities are shifting more focus to production from areas of low geopolitical risk.

 

On the demand side of the equation, the global nuclear energy industry continues robust growth, with 69 new reactors connected to the grid from 2014 through October of 2024, and with another 66 reactors under construction (Source: International Atomic Energy Association Power Reactor Information System - November 14, 2024). To date in 2024, four new reactors have been connected to the grid, and two reactors have been permanently shut down (Source: International Atomic Energy Association Power Reactor Information System - November 14, 2024). Total nuclear generating capacity for the world's 439 operable reactors as of November 4, 2024, stands at 396 GWe (Source: World Nuclear Association). At the United Nations Climate Change Conference (COP29), 6 more countries joined the pledge to triple their nuclear capacity by 2050, bringing the total to 31 countries, further supporting additional growth for the nuclear industry and uranium demand.

 

In the United States, H.R. 1042, "The Prohibiting Russian Uranium Imports Act" was signed into law and went into effect on August 11, 2024 and extends through 2040. The legislation bans Russian uranium imports but allows a United States Department of Energy ("DOE") waiver process through 2027 in the event no alternative viable source of low-enriched uranium ("LEU") is available to: (i) sustain the continued operation of a nuclear reactor or a United States nuclear energy company; or (ii) importation of Russian LEU is determined to be in the national interest. In a separate but related action, "The Nuclear Fuel Security Act" ("NFSA") was enacted as part of the "National Defense Authorization Act" in December of 2023 and was designed to help rebuild the domestic nuclear fuel cycle, including uranium production, conversion and enrichment. The passage of H.R. 1042 unlocks US$3.4 billion in funding under the NFSA and will be used by the DOE to acquire LEU and High Assay Low Enriched Uranium ("HALEU") for advanced reactors. Under this program DOE will acquire LEU and HALEU with priority given to domestic sources of produced uranium, conversion and enrichment. In combination, the passage of these bills will help rebuild and restore a robust domestic fuel cycle in the United States.

 

Additional upside market pressure is also occurring as utilities continue their return to a longer-term contracting cycle to replace expiring contracts. Cumulative uncommitted demand through 2034 is almost 865 million pounds U3O8 (Source: UxC Uranium Market Overview Q3 2024). This utility demand, along with that from financial entities, government programs, various producers, as well as the increasing interest in nuclear energy for data centers, are adding to the strong fundamentals supporting the uranium market.

Recent Developments

 

Acquisition of Salamanca Royalty

 

On July 3, 2024, the Company acquired a 0.375% net smelter returns royalty on the Salamanca project, including the Retortillo, Zona 7 and Alameda projects, located in Spain. The purchase price paid by the Company for this interest was $0.7 million in cash.

 

Acquisition of additional Churchrock Royalty

On July 31, 2024, the Company acquired a gross overriding royalty of 6% "Mine Price", which anticipates recovery of reasonable and actual costs to transport the mineral to the final point of sale. The royalty covers a portion of the Churchrock uranium project. The purchase price paid by the Company for this interest was $4.9 million (US$3.5 million) in cash.

 

Acquisition of Millennium and Cree Extension Royalties

On October 25, 2024, the Company acquired a 10% net profit interest ("NPI") royalty on an approximate 20.6955% participating interest in the Millennium and Cree Extension projects. As a profit-based NPI, the acquired royalty is calculated based upon generated revenue, with deductions for certain expenses and costs, which include cumulative expense accounts, including development costs. The purchase price paid by the Company for this interest was $6.0 million in cash.

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At-the-Market Equity Program

 

On August 8, 2023, the Company entered into an equity distribution agreement (the "2023 Distribution Agreement") with a syndicate of agents for an at-the-market equity program (the "ATM Program"). The 2023 Distribution Agreement allowed the Company to distribute up to US$40 million (or the equivalent in Canadian dollars) of common shares of the Company (the "ATM Shares") to the public from time to time, through the agents, at the Company's discretion. The ATM Shares sold under the ATM Program, were sold at the prevailing market price at the time of sale. The 2023 Distribution Agreement was terminated in connection with the 2024 Distribution Agreement (see below).

 

On August 29, 2024, the Company renewed its ATM Program that allows the Company to distribute up to US$39 million (or the equivalent in Canadian dollars) of ATM Shares to the public from time to time, through the agents, at the Company's discretion. The ATM Shares sold under the ATM Program, if any, will be sold at the prevailing market price at the time of sale. Sales of ATM Shares will be made pursuant to the terms of an equity distribution agreement dated August 29, 2024 (the "2024 Distribution Agreement"). All sales under the ATM Program following August 29, 2024 are made under the 2024 Distribution Agreement. Unless earlier terminated by the Company or the agents as permitted therein, the 2024 Distribution Agreement will terminate upon the earlier of (a) the date that the aggregate gross sales proceeds of the ATM Shares sold under the ATM Program reaches the aggregate amount of US$39 million (or the equivalent in Canadian dollars); or (b) August 20, 2025.

 

No ATM shares were distributed by the Company during the six months ended October 31, 2024.

 

Physical Uranium

 

As at October 31, 2024, the Company holds 2,761,271 pounds U3O8 at a weighted average cost of US$59.97 per pound. As at April 30, 2024, the Company held 2,511,271 pounds U3O8 and as at July 31, 2024, it held 2,711,271 pounds U3O8.

In November 2021, the Company entered into agreements with CGN Global Uranium Ltd ("CGN"), pursuant to which the Company agreed to purchase an aggregate of 500,000 pounds U3O8 at a weighted average price of US$47.71 per pound, of which 300,000 pounds and 100,000 pounds were delivered in October 2023 and July 2024, respectively. The latter shipment was originally scheduled to be delivered in June 2024 but was deferred to, and received in, July 2024 by agreement made between the parties. The delivery of the remaining 100,000 pounds for payment of $6.8 million is to occur in April 2025.

In August 2024, the Company entered into a physical uranium sale and repurchase arrangement (the "Inventory Financing Arrangement") with a third party, in which the Company sold 160,000 pounds U3O8 for approximately $18.0 million (US$13.4 million) in August 2024 and will repurchase 160,000 pounds U3O8 for approximately $19.1 million (US$13.7 million) in December 2024.

 

In October 2024, the Company sold 100,000 pounds U3O8 for approximately $10.9 million (US$79.75 per pound).

Properties Underlying Company Interests

The following is a description of selected recent developments respecting the properties in which the Company holds royalties during the six months ended October 31, 2024 and is based upon the disclosure of the operators of each respective property.

As a profit-based NPI interest, the Company's royalty on this project is calculated based upon generated revenue, with deductions for certain expenses and costs, which include cumulative expense accounts, including development costs. As such and given the significant amount of expenditures made in developing the existing operations at the Cigar Lake mine, the Cigar Lake royalty will only generate revenue to the Company after these significant cumulative expenses are recovered.

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Paladin further disclosed that it expects production to be higher in the second half of its 2025 fiscal year as it continues to work through the current challenges encountered at the Langer Heinrich mine. In an announcement dated December 5, 2024, Paladin announced that the plant has been restarted following the planned November shut-down. During the shutdown, routine plant maintenance activities and a number of improvement works were completed. The shutdown also allowed the operation to build its on-site water storage which is expected to provide a buffer to better manage ongoing water balance at the mine.

The mine is approximately seven months into a planned 21-month ramp-up period. Production levels are expected by Paladin to increase due to the processing of higher grade mined ore, which is expected to commence in the second half of calendar year 2025. Paladin remains confident of achieving a production run rate of six million pounds per year at the mine by the end of calendar year 2025.

Paladin stated in its quarterly activities report for the quarter ended September 30, 2024, that the mine had total production of 0.64 million pounds U3O8, compared to 0.52 million pounds U3O8 for the previous quarter.

On July 1, 2024, Peninsula announced that it is actively developing a new wellfield production area named Mine Unit 3 ("MU-3"). It stated that the previously developed wellfield areas of Mine Units 1 and 2 are available for resumption of uranium recovery operations. In an announcement dated July 31, 2024, Peninsula stated that, following completion of updated wellfield designs for MU-3 and incorporating data from ongoing wellfield development drilling, Peninsula expected a slightly lower initial production ramp-up than the August 2023 Life of Mine ("LOM") plan projection of 1.1 million pounds in calendar year 2025 as announced in its August 31, 2023 news release.

 

In an announcement dated October 16, 2024, Peninsula disclosed that during September and early October 2024, construction activities continued to advance, and the project remains on track for a production restart in December 2024. It further stated that, in preparation for the restart of uranium production, pre-production operational activities have continued in Mine Unit 1, which is undergoing groundwater preconditioning. Meanwhile, new development areas such as MU-3 and Header House 11 ("HH-11") have been fully constructed and prepared for commencement of preconditioning

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operations. Final regulatory approval for the MU-3 wellfield data package was received on October 11, 2024, which authorizes the full operational activities within the MU-3 area.

Peninsula provided an update on the Lance Project in an announcement dated November 15, 2024. The announcement reiterated a December 2024 start up but indicated that the final central processing plant capital cost was projected to be US$9.5 million higher than the previous estimate. In addition, the announcement provided a slightly decreased ramp-up production rate of 600,000 pounds (previously between 700,000 and 900,000 pounds), due to lower indicated flow rates evident from the preconditioning of MU-3 and difficulties acquiring sufficient drill rigs. Peninsula also marginally decreased the production rate between calendar year 2025 and calendar year 2027, with the cumulative total decreasing by approximately 300,000 to 500,000 pounds. The amendment to the Source Material License has also received conditional agency approval and will follow a similar final approval process following sequentially after the Permit to Mine. Approval of the Permit to Mine and the Source Material License will allow Peninsula to conduct production operations throughout the Kendrick area.

In its quarterly activities report for the quarter ended September 30, 2024, Paladin disclosed that a program of pole-dipole induced polarisation was completed over newly identified and prospective fault structures, and preparation progressed to extend an airborne gravity survey aimed at the collection of new hyperspectral data.

On October 23, 2024, Skyharbour announced it had completed the majority earn-in requirements to earn a 51% interest in the Russell Lake project, by initially paying a cash payment of $508,200, issuing 3,584,014 common shares to Rio Tinto Limited and incurring an aggregate $5,717,250 in exploration expenditures on the project over the 3-year term of the earn-in.

 

In a news release dated October 24, 2024, Skyharbour announced the results from the 2024 winter and spring drilling programs. It disclosed that a total of 5,152 metres was drilled in 10 holes and that the first phase of drilling consisted of a total of 3,094 metres in six holes, while the second phase of drilling consisted of 2,058 metres of drilling in four holes. Skyharbour stated that the first phase of drilling focused on drill testing the newly identified Fork Target area related to and south-southwest of the Grayling Zone. It disclosed that the best intercept of uranium mineralization to date on the property was intersected in RSL24-02, which returned a 2.5-metre-wide intercept of 0.721% U3O8 at a relatively shallow depth of 338.1 metres, including 2.99% U3O8 over 0.5 metres at 339.6 metres, just above the unconformity in the sandstone. Skyharbour further provided that, during the second phase of drilling at Russell Lake, three holes totaling 1,649 metres (holes RSL24-07 to -09) were drilled at the regional MZE target area, approximately 10 km northeast of the

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Fork Target, identifying prospective faulted graphitic gneiss accompanied by anomalous sandstone and basement geochemistry.

 

On November 7, 2024, Skyharbour indicated that a total of 4,500 metres in seven to nine holes is planned with five to six holes planned on the Fork target and two to three holes planned on the M-Zone Extension target as part of their fall diamond drilling program.

In a news release dated August 2, 2024, Anfield announced that it had engaged BRS, Inc., an engineering firm, to complete an updated uranium and vanadium resource for the Slick Rock property. In a news release dated September 24, 2024, Anfield announced that it had commenced the previously announced 2024 drilling program, with the intention of utilizing the results to provide data for the previously announced mineral resource update.

 

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Asset Portfolio

The table below sets out the Company's principal uranium royalty interests as at the date hereof:

 

Project	Operator	Location	District	Type of Royalty
Anderson	Uranium Energy Corp. ("UEC")	AZ, USA	Date Creek Basin	1.0% Net Smelter Returns
Churchrock	Laramide	NM, USA	Grants Mineral Belt	4.0% Net Smelter Returns 6.0% Mine Price Royalty(1)(2)
Cigar Lake / Waterbury Lake(1)(3)	Cameco / Orano Canada Inc. ("Orano")	SK, Canada	Athabasca Basin	10% to 20% sliding scale Net Profit Interest
Dawn Lake (1)(4)	Cameco / Orano	SK, Canada	Athabasca Basin	10% to 20% sliding scale Net Profit Interest
Dewey-Burdock(1)(5)	enCore	SD, USA	Black Hills Uplift	30% Net Proceeds 2% to 4% Gross Value Royalty
Energy Queen(1)(6)	Energy Fuels	UT, USA	La Sal Uranium District	1% Gross Value Royalty
Lance	Peninsula	WY, USA	Powder River Basin	4.0% Gross Revenues Royalty(1) 1.0% Gross Revenues Royalty
Langer Heinrich	Langer Heinrich Uranium (Pty) Ltd.	Namibia, Africa	Central Namib Desert	A$0.12 per kg U3O8 Production Royalty
McArthur River(1)(7)	Cameco	SK, Canada	Athabasca Basin	1% Gross Overriding Royalty
Michelin	Paladin	NFLD, Canada	Central Mineral Belt of Labrador	2.0% Gross Revenues Royalty
Millennium and Cree Extension(8)	Cameco	SK, Canada	Athabasca Basin	10% Net Profit Interest
Reno Creek(1)(9)	UEC	WY, USA	Powder River Basin	0.5% Net Profit Interest
Roca Honda(1)(10)	Energy Fuels	NM, USA	Grants Mineral Belt	4.0% Gross Revenues Royalty
Roughrider(11)	UEC	SK, Canada	Athabasca Basin	1.9766% Net Smelter Returns
Russell Lake and Russell Lake South(11)	Skyharbour	SK, Canada	Athabasca Basin	1.9766% Net Smelter Returns
Salamanca	Berkeley Energia Limited ("Berkeley")	Retortillo, Spain	Salamanca Uranium District	0.375% Net Smelter Returns
San Rafael(1)	Western Uranium and Vanadium Corp.	UT, USA	San Rafael Uranium District	2% Net Smelter Returns
Slick Rock	Anfield	CO, USA	Uravan Mineral Belt	1.0% Net Smelter Returns
Whirlwind(1)(12)	Energy Fuels	UT/CO, USA	Uravan Mineral Belt	2% to 4% Gross Value Royalty
Workman Creek	UEC	AZ, USA	Sierra Ancha / Apache Basin	1.0% Net Smelter Returns

 

Notes:

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Strategic Arrangement with Yellow Cake plc

 

On June 7, 2018, the Company entered into an agreement (as amended, the "Yellow Cake Agreement") with Yellow Cake, pursuant to which, among other things, the Company received an option to acquire physical uranium. These arrangements provide for, among other things:

 

Furthermore, URC and Yellow Cake have agreed to, so far as it is commercially reasonable to do so, cooperate to identify potential opportunities to work together on other uranium related joint participation endeavors.

 

In response to the ongoing war between Russia and Ukraine, governments in the United States, the European Union, the United Kingdom, Canada and others imposed financial and economic sanctions on certain industry segments and various parties in Russia. While the threat of such sanctions, import bans and other changes in trade patterns resulting from the political unrest and war in Ukraine are expected to positively impact global uranium prices and demand for North American uranium, it may adversely impact demand for uranium produced in Kazakhstan and increase regional trade and logistical barriers. The Company will continue to monitor the conflict including the potential impact of financial and economic sanctions on the global economy and particularly on the economy of Kazakhstan. Although the Company has no operations in Russia or Ukraine, the destabilizing effects of the war in Ukraine could have other effects on URC's business.

Overall Performance

For the three and six months ended October 31, 2024, the Company incurred a net loss of $0.4 million and $2.6 million, respectively, compared to net income of $3.5 million and $2.4 million, respectively, for the same periods of the previous fiscal year. As at October 31, 2024, the Company had working capital (current assets less current liabilities) of $222.2 million.

 

Trends, events and uncertainties that are reasonably likely to have an effect on the business of the Company include developments in the global and American uranium markets, as well as general uranium market conditions and the impact of the conflict in Ukraine.

 

Discussion of Operations

Three months ended October 31, 2024, compared to three months ended October 31, 2023

 

The Company had a net loss of $0.4 million in the three months ended October 31, 2024, compared to net income of $3.5 million for the same period of 2023. The change from a net income to a net loss was primarily attributable to lower uranium sales volume in the current period compared to the same period in the previous fiscal year, a change from a foreign exchange gain of $1.0 million to a

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foreign exchange loss of $0.3 million, and a change in deferred income tax from a recovery of $1.2 million in the three months ended October 31, 2023 to an expense of $0.03 million in the current quarter.

 

During the three months ended October 31, 2024, the Company incurred office and administration expenses of $1.5 million, compared to $1.8 million for the same period of 2023. During the current quarter, such expenses included investor communications and marketing expenses of $0.8 million (compared to $1.4 million for the same period in the prior fiscal year) and uranium storage fees of $0.4 million (compared to $0.2 million for the same period in the prior fiscal year). The increase in storage fees resulted from a higher volume of uranium inventories.

In the three months ended October 31, 2024, the Company incurred professional fees and insurance of $0.5 million, compared to $0.4 million for the same period in the previous fiscal year. Such fees consist primarily of audit, legal and insurance fees.

The Company had salaries and directors' fees of $0.3 million in each of the three months ended October 31, 2024 and 2023.

Share-based compensation expenses from the vesting of stock options granted to certain directors, officers, employees and consultants of the Company were $0.3 million in the three months ended October 31, 2024, compared to $0.4 million in the same period of 2023.

In the three months ended October 31, 2024, the Company had a finance cost of $0.3 million resulting from the Inventory Financing Arrangement, compared to $nil for the same period in the previous fiscal year. Due to the nature of the transaction being treated as a sale and repurchase arrangement, the cash sales proceeds were recognized as a finance payable as at October 31, 2024. The Inventory Financing Arrangement will be extinguished upon the delivery and payment for the purchase of 160,000 pounds U3O8 in December 2024.

The Company recognized a foreign exchange loss of $0.3 million in the three months ended October 31, 2024, compared to a foreign exchange gain of $1.0 million in the same period in the previous fiscal year, primarily as a result of the translation of the finance payable denominated in U.S. dollars.

The Company recognized a deferred tax expense of $0.03 million in the three months ended October 31, 2024, compared to a deferred tax recovery of $1.2 million for the same period in the prior fiscal year. The recovery in the prior period resulted from the recognition of deferred tax assets derived from the non-capital losses carryforward and deferred financing costs that were utilized to offset the deferred tax liabilities derived from the deferred tax expenses recognized in other comprehensive income in the period. The change from a recovery to an expense was due to the decrease in fair value of short-term investments.

During the three months ended October 31, 2024, the Company recorded a loss under other comprehensive income on revaluation of short-term investments of $0.2 million, compared to a gain of $8.5 million for the same period in the previous fiscal year. The significant gain in the prior period was primarily related to an increase in the fair value of the ordinary shares of Yellow Cake which were all disposed during the prior fiscal year. The change in the current quarter was due to the decrease in the fair value of publicly traded securities. Short-term investments are measured at fair value with references to the quoted share price in the market.

Six months ended October 31, 2024, compared to six months ended October 31, 2023

The Company had a net loss of $2.6 million in the six months ended October 31, 2024, compared to net income of $2.4 million for the same period of 2023. The change from a net income to a net loss was primarily attributable to the lower uranium sales volume in the current period compared to the same period in the previous fiscal year, a change from a foreign exchange gain of $1.0 million to a foreign exchange loss of $0.4 million, a change in deferred income tax from a recovery of $1.7 million in the six months ended October 31, 2023 to an expense of $0.2 million in the current period, and a finance cost of $0.3 million incurred on the Inventory Financing Arrangement.

 

During the six months ended October 31, 2024, the Company incurred office and administration expenses of $2.8 million, which included $1.7 million of investor communications and marketing expenses, compared to $1.5 million for the same period in 2023. Uranium storage fees for the six months ended October 31, 2024 were $0.8 million, compared to $0.3 million for the same period in the prior fiscal year. The increase in storage fees resulted from a higher volume of uranium inventories.

In the six months ended October 31, 2024, the Company incurred professional fees and insurance of $0.8 million, compared to $0.9 million for the same period in the previous fiscal year. Such fees consist primarily of audit, legal and insurance fees.

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In the six months ended October 31, 2024, the Company recognized share-based compensation expense of $0.4 million, compared to $0.4 million in the same period of 2023. This represents the vesting of share options issued by the Company to management, directors, employees and consultants.

 

In the six months ended October 31, 2024, the Company had interest income of $0.4 million on cash, compared to $0.1 million for the same period in the previous fiscal year. The increase in interest income was primarily due to the reinvestment of cash in high rate savings account.

In the six months ended October 31, 2024, the Company had a finance cost of $0.3 million resulting from the Inventory Financing Arrangement, compared to $nil for the same period in the previous fiscal year. The Inventory Financing Arrangement will be extinguished upon the delivery and payment for the purchase of 160,000 pounds U3O8 in December 2024.

The Company recognized a foreign exchange loss of $0.4 million in the six months ended October 31, 2024, compared to a foreign exchange gain of $1.0 million in the same period of 2023, primarily as a result of the translation of the finance payable denominated in U.S. dollars.

The Company recognized a deferred tax expense of $0.2 million in the six months ended October 31, 2024, compared to a deferred tax recovery of $1.7 million for the same period in the prior fiscal year. The recovery in the prior period resulted from the recognition of deferred tax assets derived from the non-capital losses carryforward and deferred financing costs that were utilized to offset the deferred tax liabilities derived from the deferred tax expenses recognized in other comprehensive income in the period. The change from a recovery to an expense was due to the decrease in fair value of short-term investments.

During the six months ended October 31, 2024, the Company recorded a loss under other comprehensive income on revaluation of short-term investments of $1.5 million, compared to a $12.5 million gain for the same period in the previous fiscal year. The significant gain in the prior period was primarily related to an increase in the fair value of the ordinary shares of Yellow Cake which were all disposed during the prior fiscal year. The change in the current period was due to the decrease in the fair value of publicly traded securities held by the Company. Short-term investments are measured at fair value with references to closing foreign exchange rates and the quoted share price in the market.

 

Use of Proceeds

 

ATM Program

 

As disclosed in the Company's prospectus supplement dated August 8, 2023, the Company intends to use future net proceeds from the ATM Program to finance the acquisition of additional royalties, streams, physical uranium and similar interests and for working capital purposes. No ATM Shares were distributed by the Company during the three and six months ended October 31, 2024.

 

Public Offerings

 

The following table sets out the estimated use of net proceeds from the public offering completed by the Company in February 2024, as disclosed in the Company's prospectus supplement dated February 6, 2024, and the actual use of the net proceeds of $28.8 million (US$21 million) up to October 31, 2024.

 

		As disclosed in the prospectus supplement				As at October 31, 2024
		(US$'000)				(US$'000)
Purchases of royalties, stream and similar interests and purchases of physical uranium			20,000				20,000
General working capital purposes			1,400				1,000
Total			21,400				21,000

 

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Summary of Quarterly Results

The following table sets forth selected quarterly financial results of the Company for each of the periods indicated.

 

		Revenues				Net income (loss)				Net income (loss) per share, basic and diluted		Dividends
		($ '000)				($ '000)				($)		($ '000)
January 31, 2023			—				(1,798	)		(0.02)			—
April 30, 2023			13,854				670			0.01			—
July 31, 2023			—				(1,042	)		(0.01)			—
October 31, 2023			15,318				3,490			0.03			—
January 31, 2024			15,160				3,518			0.03			—
April 30, 2024			12,228				3,814			0.03			—
July 31, 2024			—				(2,158	)		(0.02)			—
October 31, 2024			10,903				(428	)		(0.00)			—

 

Changes in net income (loss) from quarter to quarter are affected primarily by fluctuations in uranium sold by the Company in each period, the recognition of deferred income tax recovery (expense) as a result of the change in fair value of the Company's short-term investments, recognition of revenue from sales of uranium inventory, foreign exchange difference and interest expenses on the prior margin loan facility, professional fees and regulatory fees incurred for the ATM Program, share-based compensation expense recognized for the grant of stock options, and corporate activities conducted during the respective periods. The Company's positive net income in prior quarters was primarily the result of sales of uranium inventory and higher uranium prices.

 

Liquidity and Capital Resources

 

The following table sets forth selected balance sheet items for the Company as at October 31, 2024.

 

		As at				As at
		October 31, 2024				April 30, 2024
		($'000)				($'000)
Cash			12,931				21,100
Accounts receivable			41				13,818
Short-term investments			7,994				9,143
Inventories			221,176				187,090
Working capital (current assets less current liabilities)			222,152				228,993
Total assets			300,969				278,703
Total current liabilities			20,318				2,758
Accounts payable and accrued liabilities			1,333				1,202
Finance payable			18,933				—
Other payables			—				1,519
Total non-current liabilities			183				156
Shareholders' equity			280,468				275,789

 

As at October 31, 2024, the Company had cash of $12.9 million compared to $21.1 million at April 30, 2024. The decrease in cash was primarily due to the purchase of royalties and the net cash used in operating activities in relation to trading physical uranium, partially offset by the net proceeds of $18.0 million received from the Inventory Financing Arrangement and $7.7 million received from the exercise of warrants and options. Accounts receivable of $13.8 million were fully settled during the period.

 

The Company's short-term investments decreased from $9.1 million as at April 30, 2024 to $8.0 million as at October 31, 2024 as a result of a decrease in the fair value of publicly traded securities held by the Company.

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As at October 31, 2024, the Company had uranium inventories of $221.2 million, compared to $187.1 million as at April 30, 2024. The increase in inventories resulted primarily from purchases made during the period. Uranium inventories include the Company's existing inventories and the Company's entitlement of the uranium production from the McArthur River mine for the Company's royalty payments to be paid in-kind. During the six months ended October 31, 2024, the Company recorded a depletion of $0.3 million on the McArthur River royalty and an increase in inventory by the same amount. The Company will recognize revenue from its interest in McArthur River production when such uranium is sold.

 

The Company had accounts payable and accrued liabilities of $1.3 million as at October 31, 2024, compared to $1.2 million as at April 30, 2024, primarily due to increased investor communications and marketing expenses payable at the period end.

 

The Company had a finance payable of $18.9 million as at October 31, 2024 compared to $nil as at April 30, 2024, incurred on the Inventory Financing Arrangement.

 

The Company had other payables of $1.5 million as at April 30, 2024, compared to $nil as at October 31, 2024. Such amount consisted of goods and service tax payable, which was fully paid by the Company during the period.

 

As at October 31, 2024, the Company had working capital (current assets less current liabilities) of $222.2 million compared to $229 million as at April 30, 2024. Pursuant to the agreement with CGN, the Company is committed to purchase 100,000 pounds U3O8 for future payment of approximately $6.8 million in April 2025. Subsequent to October 31, 2024, approximately 9.2 million warrants were exercised for gross proceeds of $18 million and approximately 1.4 million unexercised warrants expired on December 6, 2024. The Company believes that it has sufficient cash and liquid assets available to satisfy its purchase commitments over the next 12 months.

 

The Company has not generated any sustained profits from operations and the major sources of financing to date have been the prior issuance by way of sales of Common Shares, sales of short-term investments and uranium inventories, cash receipts from the repayment of a promissory note in a prior year, and the prior margin loan facility. The Company's ability to meet its obligations and finance acquisition activities depends on its ability to generate cash flow from selling its inventories and/or through the issuance of securities of the Company pursuant to equity financings and short-term or long-term loans. Capital markets may not be receptive to offerings of new equity from treasury or debt, whether by way of private or public offerings. The Company's growth and success is dependent on external sources of financing which may not be available on acceptable terms, or at all.

 

The Company believes that its financial resources will be adequate to cover anticipated expenditures for general and administrative costs, contractual obligations and capital expenditures for at least twelve months following the date hereof. The Company's current financial resources are also available to fund acquisitions of additional interests. The Company's long-term capital requirements are primarily affected by its ongoing acquisition activities. The Company currently has, and generally at any time, may have acquisition opportunities in various stages of active review. In the event of one or more substantial royalty or other acquisitions, the Company may seek additional debt or equity financing as necessary.

Contractual Obligations

The following table summarizes the Company's contractual obligations as at October 31, 2024, including payments due for each of the next five years and thereafter:

 

		Payments due by period
(in thousands of dollars)		Total				Less than 1 year				1-3 years				4-5 years				More than 5 years
Office lease		$	235			$	52			$	121			$	62			$	—
Purchase of physical uranium (1)		$	6,842			$	6,842			$	—			$	—			$	—
Total		$	7,077			$	6,894			$	121			$	62			$	—

 

Note:

 

 

 

 

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Cash Flows

Operating Activities

Net cash used in operating activities during the six months ended October 31, 2024 was $22.8 million compared to $17.6 million for the same period in 2023. The increase was primarily as a result of net cash spent on trading physical uranium and a decrease in other payables which consisted of goods and service tax paid during the period, and incremental operating expenditures incurred during the period, which consisted of general and administrative expenses, marketing expenses, salaries and directors' fees. The increase in cash used in operating activities was partially offset by a decrease in accounts receivable from cash settlement of $13.8 million during the period. During the six months ended October 31, 2024, the Company purchased 350,000 pounds U3O8, offset by the sale of 100,000 pounds U3O8, compared to the purchase of 400,000 pounds U3O8, offset by the sale of 200,000 pounds U3O8 in the same period in 2023.

Investing Activities

Net cash used in investing activities during six months ended October 31, 2024 was approximately $11.6 million compared to $29.4 million net cash generated from investing activities for the same period in 2023. During the six months ended October 31, 2024, the Company purchased additional common shares in Queen's Road Capital Investment Ltd., for $0.4 million. In addition, the Company purchased royalties on the Millennium and Cree Extension projects, a royalty on the Salamanca project and an additional royalty interest in the Churchrock project for an aggregate acquisition cost of $11.6 million. During the six months ended October 31, 2023, the Company received net proceeds of $30.1 million from the disposal of its investment in Yellow Cake, offset by $0.8 million paid to purchase additional common shares in Queen's Road Capital Investment Ltd.

Financing Activities

Net cash generated from financing activities during the six months ended October 31, 2024 was $26.0 million, compared to $35.0 million in the same period of 2023. During the six months ended October 31, 2024, the Company received proceeds of $7.7 million from the exercise of common share purchase warrants and options. Furthermore, the Company received proceeds of $18.0 million from the Inventory Financing Arrangement. In the same period in 2023, the Company received $3.4 million from ATM Shares sold and $38.2 million from the common shares sold in the public offering. In addition, the Company received proceeds of $3.1 million from the exercise of common share purchase warrants and repaid the prior margin loan facility in full for $9.7 million.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Transactions with Related Parties

Related Party Transactions

Related party transactions are based on the amounts agreed to by the parties. During the three and six months ended October 31, 2024, the Company did not enter into any material contracts or undertake any significant commitment or obligation with any related parties other than as described herein.

Transactions with Key Management Personnel

Key management personnel are persons responsible for planning, directing and controlling the activities of an entity. The remuneration of directors and key management, for the three and six months ended October 31, 2024, comprised of:

		For the three months ended October 31,								For the six months ended October 31,
		2024				2023				2024				2023
		($ '000)				($ '000)				($ '000)				($ '000)
Management salaries			97				96				194				190
Directors' fees			47				51				93				103
Share-based compensation			195				227				243				253
Total			339				374				530				546

 

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Critical Accounting Estimates and Judgments

 

The preparation of the consolidated financial statements in accordance with IFRS requires management to make estimates and assumptions that affect the application of accounting policies and the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of income and expenses during the reporting period. The estimates and associated assumptions are based on historical circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates. Critical accounting judgments are accounting policies that have been identified as being complex or involving subjective judgment or assessments.

 

Management is required to make judgements in the application of the Company's accounting policies. The significant accounting policy judgements relevant to the current period are as follows:

 

 

Information about significant sources of estimation uncertainty are described below.

The Company estimates the attributable reserve and resource relating to the mineral properties underlying the royalties that are held by the Company. Reserves and resources are estimates of the amount of minerals that can be economically and legally extracted from the mining properties at which the Company has royalty interests, adjusted where applicable to reflect the Company's percentage entitlement to minerals produced from such mines. The public disclosures of reserves and resources that are released by the operators of the interests involve assessments of geological and geophysical studies and economic data and the reliance on a number of assumptions, including commodity prices and production costs. The estimates of reserves and resources may change based on additional knowledge gained subsequent to the initial assessment. Changes in the reserve or resource estimates may impact the carrying value of the Company's royalty interests.

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Changes in, and Initial Adoption of, Accounting Policies

The following amendment to IFRS was effective for the accounting period beginning on or after January 1, 2024, and is required to be applied retrospectively:

 

Amendments to IAS 1 - Presentation of Financial Statements

 

The amendments to IAS 1 clarifies certain requirements for determining whether a liability should be classified as current or non-current and requires new disclosures for non-current liabilities that are subject to covenants within 12 months after the reporting date. The amendment requires the classification of liabilities as current or non-current depending on the rights existing at the end of the reporting period and clarifies that management's expectations in respect of settlement do not affect classification. Liabilities are classified as noncurrent if the company has a substantive right to defer settlement for at least twelve months at the end of the reporting period. "Settlement" is defined as the extinguishment of a liability with cash, other economic resources, or an entity's own equity instruments. There is an exception for convertible instruments that might be converted into equity, but only for those instruments where the conversion option is classified as an equity instrument as a separate component of a compound financial instrument. The adoption of these amendments on May 1, 2024, did not have a material impact on the Company's consolidated financial statements.

 

Certain new accounting standards and interpretations have been issued that are not mandatory for the current period and have not been early adopted:

 

Amendments to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments

 

The International Accounting Standards Board has issued classification and measurement and disclosure amendments to IFRS 9 and IFRS 7 which are effective for years beginning on or after January 1, 2026 with earlier application permitted. The amendments clarify the date of recognition and derecognition of some financial assets and liabilities and introduce a new exception for some financial liabilities settled through an electronic payment system. Other changes include a clarification of the requirements when assessing whether a financial asset meets the solely payments of principal and interest criteria and new disclosures for certain instruments with contractual terms that can change cash flows (including instruments where cash flow changes are linked to environmental, social or governance ("ESG") targets). The Company is currently assessing the impact of this amendment on the Company's consolidated financial statements.

 

IFRS 18, Presentation and Disclosure in Financial Statements

 

IFRS 18 is a new standard that will provide new presentation and disclosure requirements and which will replace IAS 1, Presentation of Financial Statements. IFRS 18 introduces changes to the structure of the income statement; provides required disclosures in financial statements for certain profit or loss performance measures that are reported outside an entity's financial statements; and provides enhanced principles on aggregation and disaggregation in financial statements. Many other existing principles in IAS 1 have been maintained. IFRS 18 is effective for years beginning on or after January 1, 2027, with earlier application permitted. The Company is currently assessing the impact of this amendment on the Company's consolidated financial statements.

 

Financial Instruments and Risk Management

At October 31, 2024, the Company's financial assets include cash, restricted cash, accounts receivable and short-term investments. The Company's financial liabilities include accounts payable and accrued liabilities, finance payable and lease liability. The Company uses the following hierarchy for determining and disclosing fair value of financial instruments:

The Company's cash, restricted cash, accounts receivable, and accounts payable and accrued liabilities approximate fair value due to their short terms to settlement. The fair value of short-term investments, which are classified as level 1 within the fair value hierarchy, is determined by obtaining the quoted market price of the short-term investment and multiplying it by foreign exchange rate, if applicable, and the quantity of shares held by the Company. Finance payable and lease liability are measured at amortized cost. The

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fair value of the finance payable and lease liability approximate their carrying values as their interest rates are comparable to current market rates.

 

Financial risk management objectives and policies

The financial risk arising from the Company's operations are credit risk, liquidity risk, commodity price risk, currency risk and other price risk. These risks arise from the normal course of operations and all transactions undertaken are to support the Company's ability to continue as a going concern. The risks associated with these financial instruments and the policies on how the Company mitigates these risks are set out below. Management manages and monitors these exposures to ensure appropriate measures are implemented in a timely and effective manner.

Credit risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. Credit risk for the Company is primarily associated with the Company's bank balances and accounts receivable. The Company holds cash with Canadian chartered financial institutions of which the majority of its bank balances is uninsured as at October 31, 2024. The Company's maximum exposure to credit risk is equivalent to the carrying value of its cash and restricted cash balance. In order to mitigate its exposure to credit risk, the Company monitors its financial assets and maintains its cash deposits in several Schedule I chartered banks in Canada.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to settle or manage its obligations associated with financial liabilities. To manage liquidity risk, the Company closely monitors its liquidity position and ensures it has adequate sources of funding to finance its projects and operations. The Company believes that, taking into account its current cash reserves and other liquid assets, it has sufficient working capital for its present obligations for at least the next twelve months commencing from October 31, 2024. The Company's working capital (current assets less current liabilities) as at October 31, 2024 was $222.2 million. The Company's accounts payable and accrued liabilities and finance payable are expected to be realized or settled within a one-year period.

Commodity price risk

 

The recoverability of the Company's physical uranium inventories is subject to changes in uranium prices. In addition, the Company's future profitability will be dependent on the royalty income to be received from mine operators. Royalties are based on a percentage of the minerals or the products produced, or revenue or profits generated from the property which is typically dependent on the prices of the minerals the property operators are able to realize. Mineral prices are affected by numerous factors such as interest rates, exchange rates, inflation or deflation and global and regional supply and demand.

 

Currency risk

Financial instruments that impact the Company's net income due to currency fluctuations include cash and finance payable denominated in U.S. dollars. The impact of a Canadian dollar change against U.S. dollars on cash and finance payable by 1% would have an impact of approximately $0.1 million and $0.2 million, respectively, on net loss for the six months ended October 31, 2024.

 

Other price risk

The Company is exposed to equity price risk as a result of investing in other mining companies. The equity prices of these investments are impacted by various underlying factors including commodity prices. Based on the Company's short-term investments held as at October 31, 2024, a 10% change in the equity prices of these investments would have an impact, net of tax, of approximately $0.7 million on other comprehensive income.

Outstanding Share Data

As at the date hereof, the Company has 133,592,119 Common Shares outstanding.

 

 

 

 

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Share Options

The outstanding share options as at the date of this MD&A are as follows:

 

Expiry Date		Exercise Price ($)				Number Outstanding
May 13, 2025			3.31				100,000
May 31, 2026			3.49				595,000
May 31, 2026			4.10				50,000
September 15, 2026			5.46				40,000
November 8, 2026			3.76				50,000
January 13, 2027			4.93				5,000
May 13, 2027			3.31				332,500
June 20, 2027			3.26				25,000
July 7, 2027			2.88				25,000
September 9, 2027			4.20				1,000
October 24, 2027			3.15				5,000
August 21, 2028			2.92				418,550
August 29, 2028			3.30				32,500
October 17, 2029			3.92				374,500
October 30, 2029			4.00				17,000
							2,071,050

 

Each option entitles the holder thereof to purchase one Common Share.

 

Disclosure Controls and Procedures and Internal Control over Financial Reporting

Disclosure Controls and Procedures

The Chief Executive Officer (the "CEO") and the Chief Financial Officer (the "CFO") of the Company are responsible for establishing and maintaining the Company's disclosure controls and procedures ("DCP"). The Company maintains DCP designed to ensure that information required to be disclosed in reports filed under applicable Canadian securities laws and the U.S. Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the appropriate time periods and that such information is accumulated and communicated to the Company's management, including the CEO and CFO, to allow for timely decisions regarding required disclosure.

 

In designing and evaluating DCP, the Company recognizes that any disclosure controls and procedures, no matter how well conceived or operated, can only provide reasonable, not absolute, assurance that the objectives of the control system are met, and management is required to exercise its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

The CEO and CFO have evaluated whether there were changes to the DCP during the six months ended October 31, 2024 that have materially affected, or are reasonably likely to materially affect, the DCP. No such changes were identified through their evaluation.

 

Internal Control over Financial Reporting

The Company's management, including the CEO and the CFO, are responsible for establishing and maintaining adequate internal control over financial reporting ("ICFR") for the Company to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. The fundamental issue is ensuring all transactions are properly authorized and identified and entered into a well-designed, robust and clearly understood accounting system on a timely basis to minimize risk of inaccuracy, failure to fairly reflect transactions, failure to fairly record transactions necessary to present financial statements in accordance with IFRS, unauthorized receipts and expenditures, or the inability to provide assurance that unauthorized acquisitions or dispositions of assets can be detected.

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The Company's ICFR may not prevent or detect all misstatements because of inherent limitations. Additionally, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with the Company's policies and procedures.

 

The CEO and CFO have evaluated whether there were changes to the ICFR during the six months ended October 31, 2024 that have materially affected, or are reasonably likely to materially affect, the ICFR. No such changes were identified through their evaluation.

Risk Factors

A comprehensive discussion of risk factors is included in the AIF and other filings with the Canadian Regulatory Authorities available on SEDAR+.

Additional Information

Additional information concerning the Company, including the Company's AIF, is available under the Company's profile on SEDAR+ and at www.sec.gov.

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Form 52-109F2

Certification of Interim Filings

Full Certificate

 

I, Scott Melbye, Chief Executive Officer of Uranium Royalty Corp., certify the following:

1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of Uranium Royalty Corp. (the "issuer") for the interim period ended October 31, 2024.

 

2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

 

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

 

4. Responsibility: The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

 

5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings,

 

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

 

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

 

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

 

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

 

5.1 Control framework: The control framework the issuer's other certifying officer(s) and I used to design the issuer's ICFR is that published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

 

5.2 N/A.

 

5.3 N/A.

 

6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on August 1, 2024 and ended on October 31, 2024 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

 

Date: December 12, 2024
/s/ Scott Melbye
Scott Melbye
Chief Executive Officer

 

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Form 52-109F2

Certification of Interim Filings

Full Certificate

 

I, Josephine Man, Chief Financial Officer of Uranium Royalty Corp., certify the following:

1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of Uranium Royalty Corp. (the "issuer") for the interim period ended October 31, 2024.

 

2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

 

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

 

4. Responsibility: The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

 

5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer(s) and I have, as at the end of the period covered by the interim filings,

 

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

 

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

 

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

 

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

 

5.1 Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer's ICFR is that published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

 

5.2 N/A.

 

5.3 N/A.

 

6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on August 1, 2024 and ended on October 31, 2024 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

 

Date: December 12, 2024

/s/ Josephine Man

Josephine Man

Chief Financial Officer

 

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