TORONTO, Aug. 2, 2023
/CNW/ - Labrador Iron Ore Royalty Corporation ("LIORC") (TSX: LIF)
announced today its operation and cash flow results for the first
quarter ended June 30, 2023.
To the Holders of Common Shares of
Labrador Iron Ore Royalty Corporation
The Directors of Labrador Iron Ore Royalty Corporation ("LIORC"
or the "Corporation") present the second quarter report for the
period ended June 30, 2023.
Financial Performance
In the second quarter of 2023, LIORC's financial results were
negatively affected by lower iron ore prices and a change in
product sales mix (lower sales volumes of pellets and higher sales
volumes of concentrate for sale ("CFS")). Royalty revenue for the
second quarter of 2023 amounted to $50.9
million compared to $65.9
million for the second quarter of 2022. Equity earnings from
Iron Ore Company of Canada ("IOC")
were $13.5 million in the second
quarter of 2023 compared to $47.2
million in the second quarter of 2022, as a result of lower
revenue and higher operating costs at IOC. Net income per share for
the second quarter of 2023 was $0.65
per share, which was a 47% decrease over the same period in 2022.
LIORC received a dividend from IOC in the amount of $19.9 million in the second quarter of 2023,
compared to a dividend from IOC in the amount of $19.6 million in the second quarter of 2022. The
adjusted cash flow per share for the second quarter of 2023 was
$0.75 per share, which was 15% lower
than in the same period in 2022, as a result of lower royalty
revenues. While adjusted cash flow is not a recognized measure
under International Financial Reporting Standards ("IFRS"), the
Directors believe that it is a useful analytical measure as it
better reflects cash available for dividends to shareholders.
In the second quarter of 2023, iron ore prices declined from the
levels experienced in 2022 and in the first quarter of 2023,
predominantly as a result of lower global steel production, and
continuing concerns over China's
economy and its property sector, in particular. According to the
World Steel Association, global crude steel production decreased
2.6% in the second quarter of 2023 over the second quarter of 2022.
In China, which accounts for over
70% of all seaborne iron ore demand, crude steel production
decreased 2.9% in the second quarter of 2023 over the second
quarter of 2022.
IOC sells CFS based on the Platts index for 65% Fe, CFR China
("65% Fe index"). All references to tonnes and per tonne prices in
this report refer to wet metric tonnes, other than references to
Platts quoted pricing, which refer to dry metric tonnes.
Historically, IOC's wet ore contains approximately 3% less ore per
equivalent volume than dry ore. In the second quarter of 2023, the
65% Fe index averaged US$124 per
tonne, a 23% decrease over the average of US$160 per tonne in the second quarter of 2022,
and an 11% decrease over the average of US$140 in the first quarter of 2023. In addition,
low steel production margins in China caused steel mills to prefer
medium-grade fines over high-grade fines. As a result, the spread
of the 65% Fe index over the Platts index for 62% Fe, CFR China
("62% Fe Index") narrowed in the second quarter of 2023 to
$13 per tonne from $22 per tonne in the second quarter of 2022. The
monthly Atlantic Blast Furnace 65% Fe pellet premium index as
quoted by Platts (the "pellet premium") averaged US$47 per tonne in the second quarter of 2023,
down 42% from an average of US$81 per
tonne in the same quarter of 2022.
Rio Tinto has disclosed that the average realised price achieved
for IOC pellets, FOB Sept Îles, in the second quarter of 2023 was
US$151 per tonne, compared to
US$206 per tonne in the same quarter
of 2022. Based on sales as reported for the LIORC Royalty, the
overall average price realized by IOC for CFS and pellets, FOB
Sept-Îles, was approximately US$125
per tonne in the second quarter of 2023, compared to approximately
US$168 per tonne in the second
quarter of 2022 and US$136 per tonne
in the first quarter of 2023.
Iron Ore Company of Canada
Operations
Operations
IOC concentrate production of 3.8 million tonnes in the second
quarter of 2023 was 24% lower than the same quarter of 2022 and 17%
lower than in the first quarter of 2023, mainly due to the impact
of the forest fires and resulting issues related to stockpile
management in June, as well as issues with weather and ore car
reliability earlier in the quarter.
The IOC saleable production (CFS plus pellets) of 3.5 million
tonnes in the second quarter of 2023 was 21% lower than the same
period in 2022, due to the lack of concentrate feed as a result of
the factors referred to above. The IOC saleable production in the
second quarter of 2023 was 18% lower than the first quarter of
2023.
Pellet production in the second quarter of 2023 of 1.6 million
tonnes was 29% lower than the corresponding quarter in 2022 and 27%
lower than the first quarter of 2023. Pellet production in
the second quarter of 2023 was negatively impacted by the forest
fires in June, as well as an increase in the duration of the
induration machine 3 rebuild. In the second quarter of 2023, CFS
production of 1.9 million tonnes was 13% lower than the same
quarter last year and 10% lower than the first quarter of 2023, due
to the reduction of concentrate production in June as a result of
the forest fires and the overrun of the annual maintenance
shutdown.
Sales as Reported for the LIORC
Royalty
Total iron ore sales tonnage by IOC (CFS plus pellets) of 4.4
million tonnes in the second quarter of 2023 was 2% higher than the
total sales tonnage for the same period in 2022 and 21% higher than
the first quarter of 2023, as IOC drew down inventory, despite the
negative impact of the forest fires and the annual maintenance
shutdown in June. Pellet sales tonnage in the second quarter of
2023 was 6% lower than the same period in 2022 and 18% higher than
the first quarter of 2023. CFS sales tonnage was 14% higher than
the same quarter last year and 24% higher than the first quarter of
2023.
Outlook
Rio Tinto's 2023 guidance for IOC's saleable production (CFS
plus pellets) has been lowered to 17.0 million to 18.7 million
tonnes (previously 17.9 million to 19.6 million tonnes) as a result
of lost production in June due to wildfires in Northern
Quebec, together with a slightly extended annual maintenance
shutdown. This revised guidance compares to 17.6 million tonnes of
saleable production in 2022. As reported in the 2022 Annual Report,
IOC has set a capital expenditure budget of $534 million for 2023, as it looks to continue
renewing the asset infrastructure and to improve the production
results at IOC. Year-to-date, IOC is on track with regards to its
capital expenditures, and its budget remains unchanged.
There continues to be a number of adverse issues affecting the
outlook for the seaborne iron ore market. In China, extreme weather and unfavorable steel
producer margins, are predicted to negatively impact the demand
outlook for steel production. Tempering this negative sentiment, is
the expectation that the Chinese government will announce measures
to support the troubled property market which consumes about
one-third of China's steel output.
This could include lending rate cuts and potentially additional
stimulus moving forward. More recently, in July 2023 the average price of the 65% Fe index
was US$126 per tonne, roughly
equivalent to the average of the 65% Fe index for the second
quarter of 2023. The pellet premiums have also improved modestly.
The pellet premium for July was US$49
per tonne compared to the average of US$47 per tonne in the second quarter of
2023.
LIORC has no debt and at June 30,
2023 had positive net working capital (current assets less
current liabilities) of $29.8
million, which included the second quarter net royalty
payment received from IOC on July 25,
2023 and the LIORC dividend in the amount of $0.65 per share paid to shareholders on the next
day.
Respectfully submitted on behalf of the Directors of the
Corporation,
John F. Tuer
President and Chief Executive Officer
August 2, 2023
Management's Discussion and
Analysis
The following discussion and analysis should be read in
conjunction with the Management's Discussion and Analysis section
of Labrador Iron Ore Royalty Corporation's ("LIORC" or the
"Corporation") 2022 Annual Report, and the financial statements and
notes contained therein and the June 30,
2023 interim condensed consolidated financial
statements.
Overview of the Business
The Corporation's revenues are entirely dependent on the
operations of IOC as its principal assets relate to the operations
of IOC and its principal source of revenue is the 7% royalty it
receives on all sales of iron ore products by IOC. In addition to
the volume of iron ore sold, the Corporation's royalty revenue is
affected by the price of iron ore and the Canadian – U.S. dollar
exchange rate. The first quarter sales of IOC are traditionally
adversely affected by the general winter operating conditions and
are usually 15% – 20% of the annual volume, with the balance spread
fairly evenly throughout the other three quarters. Because of the
size of individual shipments, some quarters may be affected by the
timing of the loading of ships that can be delayed from one quarter
to the next.
Financial Highlights
|
Three Months Ended
|
|
Six Months Ended
|
|
June 30,
|
|
June 30,
|
|
2023
|
2022
|
|
2023
|
2022
|
|
($ in millions
except per share information)
|
|
|
|
|
|
|
Revenue
|
51.5
|
66.4
|
|
98.8
|
120.5
|
Equity earnings from
IOC
|
13.5
|
47.2
|
|
35.4
|
87.6
|
Net
income
|
41.9
|
78.4
|
|
85.4
|
141.7
|
Net income per
share
|
$ 0.65
|
$ 1.23
|
|
$ 1.33
|
$ 2.21
|
Dividend from
IOC
|
19.9
|
19.6
|
|
19.9
|
19.6
|
Cash flow from
operations
|
40.9
|
41.1
|
|
60.4
|
45.2
|
Cash flow from
operations per share(1)
|
$ 0.64
|
$ 0.64
|
|
$ 0.94
|
$ 0.71
|
Adjusted cash
flow(1)
|
48.3
|
56.4
|
|
74.4
|
86.2
|
Adjusted cash flow per
share(1)
|
$ 0.75
|
$ 0.88
|
|
$ 1.16
|
$ 1.35
|
Dividends declared per
share
|
$ 0.65
|
$ 0.90
|
|
$ 1.15
|
$ 1.40
|
|
|
|
|
|
|
(1)
This is a non-IFRS financial measure and
does not have a standard meaning under IFRS.
|
|
Please refer to Standardized
Cash Flow and Adjusted Cash Flow section in the
MD&A.
|
|
The lower revenue, net income and equity earnings achieved in
the second quarter of 2023 as compared to 2022 were mainly due
to lower iron ore prices, and a change in product sales mix (lower
sales volumes of pellets and higher sales volumes of CFS). The
second quarter of 2023 sales tonnage (pellets and CFS) were higher
by 2% than the second quarter of 2022 predominantly due to IOC
drawing down inventory at the port facility in Sept-Îles, despite
the negative impact of the forest fires and the annual maintenance
shutdown in June. CFS sales tonnage was 14% higher than the same
quarter last year and pellet sales tonnage was 6% lower than the
same period in 2022.
However, the slightly higher sales tonnage was more than offset
by a decrease in the realized sales price of pellets and CFS,
resulting in royalty income of $50.9
million for the quarter as compared to $65.9 million for the same period in 2022. Second
quarter 2023 cash flow from operations was $40.9 million or $0.64 per share compared to $41.1 million or $0.64 per share for the same period in 2022.
LIORC received an IOC dividend in the second quarter of 2023 in the
amount of $19.9 million or
$0.31 per share compared to
$19.6 million for the same period in
2022. Equity earnings from IOC amounted to $13.5 million or $0.21 per share in the second quarter of 2023
compared to $47.2 million or
$0.74 per share for the same period
in 2022.
Operating Highlights
|
Three Months Ended
|
|
Six Months Ended
|
|
June 30,
|
|
June 30,
|
IOC Operations
|
2023
|
2022
|
|
2023
|
2022
|
|
(in millions of
tonnes)
|
Sales(1)
|
|
|
|
|
|
Pellets
|
2.30
|
2.46
|
|
4.26
|
4.89
|
Concentrate for sale
("CFS")(2)
|
2.09
|
1.84
|
|
3.79
|
2.99
|
Total(3)
|
4.40
|
4.30
|
|
8.05
|
7.88
|
|
|
|
|
|
|
Production
|
|
|
|
|
|
Concentrate
produced
|
3.83
|
5.03
|
|
8.46
|
9.41
|
|
|
|
|
|
|
Saleable production
|
|
|
|
|
|
Pellets
|
1.61
|
2.25
|
|
3.79
|
4.71
|
CFS
|
1.91
|
2.18
|
|
4.02
|
3.82
|
Total(3)
|
3.51
|
4.43
|
|
7.81
|
8.53
|
|
|
|
|
|
|
Average index prices
per tonne (US$)
|
|
|
|
|
|
65% Fe
index(4)
|
$ 124
|
$ 160
|
|
$ 132
|
$ 165
|
62% Fe
index(5)
|
$ 111
|
$ 138
|
|
$ 118
|
$ 140
|
Pellet
premium(6)
|
$ 47
|
$ 81
|
|
$ 46
|
$ 74
|
(1)
|
For calculating the
royalty to LIORC.
|
(2)
|
Excludes third party
ore sales.
|
(3)
|
Totals may not add up
due to rounding.
|
(4)
|
The Platts index
for 65% Fe, CFR China.
|
(5)
|
The Platts index
for 62% Fe, CFR China.
|
(6)
|
The Platts
Atlantic Blast Furnace 65% Fe pellet premium index.
|
IOC sells CFS based on the 65% Fe index. In the second quarter
of 2023, the 65% Fe index averaged US$124 per tonne, a 23% decrease over the average
of US$160 per tonne in the second
quarter of 2022. Iron ore prices decreased, predominantly as a
result of lower global steel production, and continuing concerns
over China's economy and its
property sector, in particular. The monthly pellet premium averaged
US$47 per tonne in the second quarter
of 2023, down 42% from an average of US$81 per tonne in the same quarter of 2022.
Based on sales as reported for the LIORC Royalty, the overall
average price realized by IOC for CFS and pellets, FOB Sept-Îles,
was approximately US$125 per tonne in
the second quarter of 2023, compared to approximately US$168 per tonne in the second quarter of 2022
and US$136 per tonne in the first
quarter of 2023. The decrease in the average realized price FOB
Sept-Îles in 2023 was a result of lower CFS prices and lower pellet
prices (comprised of lower iron ore index pricing and lower pellet
premiums).
Standardized Cash Flow and
Adjusted Cash Flow
For the Corporation, standardized cash flow is the same as cash
flow from operating activities as recorded in the Corporation's
cash flow statements as the Corporation does not incur capital
expenditures or have any restrictions on dividends. Standardized
cash flow per share was $0.64 for the
quarter (2022 - $0.64).
The Corporation also reports "Adjusted cash flow" which is
defined as cash flow from operating activities after adjustments
for changes in amounts receivable, accounts payable and income
taxes recoverable and payable. It is not a recognized measure under
IFRS. The Directors believe that adjusted cash flow is a useful
analytical measure as it better reflects cash available for
dividends to shareholders.
The following reconciles standardized cash flow from operating
activities to adjusted cash flow.
|
3 Months
Ended
Jun. 30,
2023
|
3 Months
Ended
Jun. 30,
2022
|
6 Months
Ended
Jun. 30,
2023
|
6 Months
Ended
Jun. 30,
2022
|
|
|
(in millions except
for per share information)
|
|
|
|
|
Standardized cash flow
from operating
activities
|
$40.9
|
$41.1
|
$60.4
|
$45.2
|
|
|
Changes in amounts
receivable, accounts
payable and income
taxes payable
|
7.4
|
15.3
|
14.0
|
41.0
|
|
Adjusted cash
flow
|
$48.3
|
$56.4
|
$74.4
|
$86.2
|
|
Adjusted cash flow per
share
|
$0.75
|
$0.88
|
$1.16
|
$1.35
|
|
Liquidity and Capital Resources
The Corporation had $23.5 million
in cash as at June 30, 2023
(December 31, 2022 - $39.9 million) with total current assets of
$82.6 million (December 31, 2022 - $83.0
million). The Corporation had working capital of
$29.8 million as at June 30, 2023 (December
31, 2022 - $28.9 million). The
Corporation's operating cash flow was $40.9
million and the dividend paid during the quarter was
$32 million, resulting in cash
balances increasing by $8.9 million
during the second quarter of 2023. In June the Directors of the
Corporation declared the second quarter dividend of $41.6 million that was paid on July 26, 2023.
Cash balances consist of deposits in Canadian dollars with a
Canadian chartered bank. Amounts receivable primarily consist of
royalty payments from IOC. Royalty payments are received in U.S.
dollars and converted to Canadian dollars on receipt, usually 25
days after the quarter end. The Corporation does not normally
attempt to hedge this short-term foreign currency exposure.
Operating cash flow of the Corporation is sourced entirely from
IOC through the Corporation's 7% royalty, 10
cents commission per tonne and dividends from its 15.10%
equity interest in IOC. The Corporation normally pays cash
dividends from the free cash flow generated from IOC to the maximum
extent possible, subject to the maintenance of appropriate levels
of working capital.
The Corporation has a $30 million
revolving credit facility with a term ending September 18, 2025 with provision for annual
one-year extensions. No amount is currently drawn under this
facility (2022 – nil) leaving $30.0
million available to provide for any capital required by IOC
or requirements of the Corporation.
John F. Tuer
President and Chief Executive Officer
Toronto, Ontario
August 2, 2023
Forward-Looking
Statements
This report may contain "forward-looking" statements that
involve risks, uncertainties and other factors that may cause the
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Words such
as "may", "will", "expect", "believe", "plan", "intend", "should",
"would", "anticipate" and other similar terminology are intended to
identify forward-looking statements. These statements reflect
current assumptions and expectations regarding future events and
operating performance as of the date of this report.
Forward-looking statements involve significant risks and
uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not such results will be achieved. A
number of factors could cause actual results to vary significantly,
including iron ore price and volume volatility; the performance of
IOC; market conditions in the steel industry; fluctuations in the
value of the Canadian and U.S. dollar; mining risks that cause a
disruption in operations and availability of insurance; disruption
in IOC's operations caused by natural disasters, severe weather
conditions and public health crises, including the COVID-19
outbreak; failure of information systems or damage from cyber
security attacks; adverse changes in domestic and global economic
and political conditions; changes in government regulation and
taxation; national, provincial and international laws, regulations
and policies regarding climate change that further limit the
emissions of greenhouse gases or increase the costs of operations
for IOC or its customers; changes affecting IOC's customers;
competition from other iron ore producers; renewal of mining
licenses and leases; relationships with indigenous groups;
litigation; and uncertainty in the estimates of reserves and
resources. A discussion of these factors is contained in LIORC's
annual information form dated March 7,
2023 under the heading, "Risk Factors". Although the
forward-looking statements contained in this report are based upon
what management of LIORC believes are reasonable assumptions, LIORC
cannot assure investors that actual results will be consistent with
these forward-looking statements. These forward-looking statements
are made as of the date of this report and LIORC assumes no
obligation, except as required by law, to update any
forward-looking statements to reflect new events or circumstances.
This report should be viewed in conjunction with LIORC's other
publicly available filings, copies of which can be obtained
electronically on SEDAR at www.sedar.com.
Notice:
The following unaudited interim condensed consolidated financial
statements of the Corporation have been prepared by and are the
responsibility of the Corporation's management. The Corporation's
independent auditor has not reviewed these interim financial
statements.
LABRADOR IRON ORE ROYALTY
CORPORATION
|
|
|
|
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF
FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at
|
|
|
June 30,
|
|
December 31,
|
(in thousands of
Canadian dollars)
|
2023
|
|
2022
|
|
|
(Unaudited)
|
Assets
|
|
|
|
Current
Assets
|
|
|
|
|
Cash
|
$
23,520
|
|
$
39,904
|
|
Amounts
receivable
|
54,686
|
|
42,758
|
|
Income taxes
recoverable
|
4,404
|
|
357
|
Total Current
Assets
|
82,610
|
|
83,019
|
|
|
|
|
|
Non-Current
Assets
|
|
|
|
|
Iron Ore Company of
Canada ("IOC")
|
|
|
|
|
royalty
and commission interests
|
225,872
|
|
228,918
|
|
Investment in
IOC
|
528,927
|
|
513,828
|
Total Non-Current
Assets
|
754,799
|
|
742,746
|
|
|
|
|
|
Total Assets
|
$
837,409
|
|
$
825,765
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders'
Equity
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts payable and
accrued liabilities
|
$
11,246
|
|
$
9,286
|
|
Dividend
payable
|
41,600
|
|
44,800
|
Total Current
Liabilities
|
52,846
|
|
54,086
|
|
|
|
|
|
Non-Current
Liabilities
|
|
|
|
|
Deferred income
taxes
|
135,590
|
|
134,220
|
Total
Liabilities
|
188,436
|
|
188,306
|
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
Share
capital
|
317,708
|
|
317,708
|
|
Retained
earnings
|
336,650
|
|
324,821
|
|
Accumulated other
comprehensive loss
|
(5,385)
|
|
(5,070)
|
|
|
648,973
|
|
637,459
|
|
|
|
|
|
Total Liabilities and
Shareholders' Equity
|
$
837,409
|
|
$
825,765
|
|
|
Approved by the
Directors,
|
|
|
|
John F. Tuer
|
Patricia M.
Volker
|
Director
|
Director
|
LABRADOR IRON ORE ROYALTY
CORPORATION
|
|
|
|
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended
|
|
|
June 30,
|
(in thousands of
Canadian dollars except for per share information)
|
2023
|
|
2022
|
|
|
|
Revenue
|
|
|
|
|
IOC
royalties
|
$
50,941
|
|
$
65,907
|
|
IOC
commissions
|
433
|
|
423
|
|
Interest and other
income
|
163
|
|
38
|
|
|
51,537
|
|
66,368
|
Expenses
|
|
|
|
|
Newfoundland royalty
taxes
|
10,188
|
|
13,181
|
|
Amortization of royalty
and commission interests
|
1,464
|
|
2,017
|
|
Administrative
expenses
|
774
|
|
641
|
|
|
12,426
|
|
15,839
|
|
|
|
|
|
Income before equity earnings and income
taxes
|
39,111
|
|
50,529
|
Equity earnings in
IOC
|
13,543
|
|
47,195
|
|
|
|
|
|
Income before income
taxes
|
52,654
|
|
97,724
|
|
|
|
|
|
Provision for income
taxes
|
|
|
|
|
Current
|
12,174
|
|
15,744
|
|
Deferred
|
(1,384)
|
|
3,551
|
|
|
10,790
|
|
19,295
|
|
|
|
|
|
Net income for the period
|
41,864
|
|
78,429
|
|
|
|
|
|
Other comprehensive (loss)
income
|
|
|
|
|
Share of other
comprehensive (loss) income of IOC that will not
be
|
|
|
|
reclassified
subsequently to profit or loss (net of income
taxes
|
|
|
|
|
of 2023 - $56; 2022 -
$989)
|
(315)
|
|
5,602
|
|
|
|
|
|
Comprehensive income for the
period
|
$
41,549
|
|
$
84,031
|
|
|
|
|
|
Net income per share
|
$
0.65
|
|
$
1.23
|
LABRADOR IRON ORE ROYALTY
CORPORATION
|
|
|
|
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six months Ended
|
|
|
June 30,
|
(in thousands of
Canadian dollars except for per share information)
|
2023
|
|
2022
|
|
|
(Unaudited)
|
Revenue
|
|
|
|
|
IOC
royalties
|
$
97,484
|
|
$
119,655
|
|
IOC
commissions
|
792
|
|
776
|
|
Interest and other
income
|
475
|
|
101
|
|
|
98,751
|
|
120,532
|
Expenses
|
|
|
|
|
Newfoundland royalty
taxes
|
19,497
|
|
23,931
|
|
Amortization of royalty
and commission interests
|
3,046
|
|
3,322
|
|
Administrative
expenses
|
1,429
|
|
1,525
|
|
|
23,972
|
|
28,778
|
|
|
|
|
|
Income before equity earnings and income
taxes
|
74,779
|
|
91,754
|
Equity earnings in
IOC
|
35,360
|
|
87,574
|
|
|
|
|
|
Income before income
taxes
|
110,139
|
|
179,328
|
|
|
|
|
|
Provision for income taxes
|
|
|
|
|
Current
|
23,284
|
|
28,432
|
|
Deferred
|
1,426
|
|
9,221
|
|
|
24,710
|
|
37,653
|
|
|
|
|
|
Net income for the period
|
85,429
|
|
141,675
|
|
|
|
|
|
Other comprehensive
(loss) income
|
|
|
|
|
Share of other
comprehensive (loss) income of IOC that will not
be
|
|
|
|
reclassified
subsequently to profit or loss (net of income taxes
|
|
|
|
|
of 2023 - $56; 2022 -
$989)
|
(315)
|
|
5,602
|
|
|
|
|
|
Comprehensive income for the
period
|
$
85,114
|
|
$
147,277
|
|
|
|
|
|
Basic and diluted
income per share
|
$
1.33
|
|
$
2.21
|
LABRADOR IRON ORE ROYALTY
CORPORATION
|
|
|
|
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six months Ended
|
|
|
|
|
June 30,
|
(in thousands of
Canadian dollars)
|
2023
|
|
2022
|
|
|
|
|
(Unaudited)
|
Net inflow (outflow) of cash
related
|
|
|
|
|
to the following activities
|
|
|
|
|
|
|
|
|
|
|
Operating
|
|
|
|
|
|
Net income for the
period
|
$
85,429
|
|
$ 141,675
|
|
Items not affecting
cash:
|
|
|
|
|
|
Equity earnings in
IOC
|
(35,360)
|
|
(87,574)
|
|
|
Current income
taxes
|
23,284
|
|
28,432
|
|
|
Deferred income
taxes
|
1,426
|
|
9,221
|
|
|
Amortization of royalty
and commission interests
|
3,046
|
|
3,322
|
|
Common share dividends
from IOC
|
19,890
|
|
19,551
|
|
Change in amounts
receivable
|
(11,928)
|
|
(21,112)
|
|
Change in accounts
payable
|
1,960
|
|
3,698
|
|
Income taxes
paid
|
(27,331)
|
|
(52,000)
|
|
Cash flow from
operating activities
|
60,416
|
|
45,213
|
|
|
|
|
|
|
|
Financing
|
|
|
|
|
|
Dividends paid to
shareholders
|
(76,800)
|
|
(105,600)
|
|
Cash flow used in
financing activities
|
(76,800)
|
|
(105,600)
|
|
|
|
|
|
|
|
Decrease in cash, during the
period
|
(16,384)
|
|
(60,387)
|
|
|
|
|
|
|
|
Cash, beginning of period
|
39,904
|
|
82,913
|
|
|
|
|
|
|
|
Cash, end of period
|
$
23,520
|
|
$
22,526
|
LABRADOR IRON ORE ROYALTY
CORPORATION
|
|
|
|
|
|
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES
IN EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
other
|
|
|
Common
|
Share
|
Retained
|
comprehensive
|
|
(in thousands of
Canadian dollars except share amounts)
|
shares
|
capital
|
earnings
|
loss
|
Total
|
|
(Unaudited)
|
|
|
|
|
|
|
Balance as at December
31, 2021
|
64,000,000
|
$ 317,708
|
$
257,772
|
$
(11,420)
|
$
564,060
|
Net income for the
period
|
-
|
-
|
141,675
|
-
|
141,675
|
Dividends declared to
shareholders
|
-
|
-
|
(89,600)
|
-
|
(89,600)
|
Share of other
comprehensive income from investment in IOC (net of
taxes)
|
-
|
-
|
-
|
5,602
|
5,602
|
Balance as at June 30,
2022
|
64,000,000
|
$ 317,708
|
$
309,847
|
$
(5,818)
|
$
621,737
|
|
|
|
|
|
|
Balance as at December
31, 2022
|
64,000,000
|
$ 317,708
|
$
324,821
|
$
(5,070)
|
$
637,459
|
Net income for the
period
|
-
|
-
|
85,429
|
-
|
85,429
|
Dividends declared to
shareholders
|
-
|
-
|
(73,600)
|
-
|
(73,600)
|
Share of other
comprehensive loss from investment in IOC (net of taxes)
|
-
|
-
|
-
|
(315)
|
(315)
|
Balance as at June 30,
2023
|
64,000,000
|
$ 317,708
|
$
336,650
|
$
(5,385)
|
$
648,973
|
The complete consolidated financial statements for the second
quarter ended June 30, 2023,
including the notes thereto, are posted on sedar.com and
labradorironore.com.
SOURCE Labrador Iron Ore Royalty Corporation