Maverix Metals Inc. (NYSE: MMX) (TSX: MMX) is pleased to announce operating and financial results for the third quarter ended September 30, 2022.
Third Quarter 2022 Highlights
Dan O’Flaherty, CEO of Maverix, commented, “As recently announced, the friendly merger of Maverix and Triple Flag Precious Metals will create the leading pure play, gold-focused emerging senior streaming and royalty company. We are excited as the combination is a continuation of the precious metals focused strategy that Maverix has followed since our inception. Maverix also posted strong third quarter operating and financial results, with several of our royalty and stream counterparties having announced positive operational updates. Additionally, it is pleasing to see that a number of the underlying development assets in our diverse portfolio are continuing to advance as expected.”
Summary of Quarterly Results
(in thousands of USD, except for GEOs and per share amounts)
|September 30, 2022||September 30, 2021|
|Statement of Income and Comprehensive Income|
|Basic earnings per share||$||0.02||$||0.02|
|Diluted earnings per share||$||0.02||$||0.02|
|Cash flow from operating activities||$||9,491||$||9,278|
|Dividends declared per share||$||0.0125||$||0.0125|
|Non-IFRS and Other Measures1|
|Adjusted net income||$||4,950||$||4,709|
|Adjusted basic earnings per share||$||0.03||$||0.03|
|Average realized gold price per GEO||$||1,705||$||1,780|
|Average cash cost per GEO||$||171||$||164|
|Cash operating margin per GEO||$||1,534||$||1,616|
|Cash flow from operating activities, excluding changes in non-cash working capital||$||12,597||$||9,682|
For complete details please refer to the unaudited condensed interim consolidated financial statements and associated Management Discussion and Analysis for the quarter ended September 30, 2022, available on SEDAR (www.sedar.com), EDGAR (www.sec.gov) or on Maverix’s website (www.maverixmetals.com).
To listen to Maverix’s President, Ryan McIntyre, discuss the third quarter results please use this link: Q3 2022 Results
Friendly Acquisition of Maverix by Triple Flag
On November 10, 2022, the Company announced that it had entered into a definitive agreement (the “Agreement”) with Triple Flag Precious Metals Corp. in which Triple Flag will acquire all the issued and outstanding common shares of Maverix pursuant to a Plan of Arrangement, positioning Triple Flag as the leading emerging senior streaming and royalty company.
Pursuant to the Transaction, the Company’s shareholders may elect to receive either $3.92 in cash or 0.360 of a Triple Flag share per Maverix share held, representing share consideration of $3.92 per Maverix share based on the closing price of Triple Flag shares on November 9, 2022 of $10.89. The shareholder election will be subject to pro-ration such that the cash consideration will not exceed 15% of the total consideration and the share consideration will not exceed 85% of the total consideration. Maverix shareholders who do not elect to receive either Triple Flag shares or cash will be deemed to elect default consideration of 0.360 Triple Flag shares per Maverix share.
Under the terms of the Agreement, the Transaction will be carried out by way of a court-approved Plan of Arrangement under the Canada Business Corporations Act, and will require the approval of at least (i) 66 22/3% of the votes cast be shareholders of Maverix at a special meeting and (ii) if required, minority shareholder approval in accordance with Multilateral Instrument 61-101.
Upon completion of the Transaction, existing Triple Flag and Maverix shareholders would own approximately 77% and 23% of the combined company, respectively, on a fully diluted basis. Triple Flag shareholder Elliott Investment Management L.P. and Maverix shareholders, Newmont Corporation, Pan American Silver Corp. and Kinross Gold Corporation are all supportive of the combination, reflecting their belief in the value and potential of the combined company.
Newmont Corporation and Pan American Silver Corp., together with all of the officers and directors of Maverix, collectively control approximately 57% of the common shares of Maverix on a fully-diluted basis and have entered into voting and support agreements pursuant to which they have agreed to vote their shares in favour of the Transaction.
Completion of the Transaction is also subject to regulatory and court approvals and other customary closing conditions. The Agreement includes customary provisions, including non-solicitation by Maverix of alternative transactions, a right of Triple Flag to match superior proposals and an approximately $24 million termination fee, payable under certain circumstances.
Complete details of the Transaction will be included in a management information circular to be delivered to Maverix shareholders in the coming weeks. Subject to receiving requisite court approval, the special meeting of shareholders of Maverix is expected to be held in early January 2023 and the Transaction is also expected to close in January 2023.
Adjusted Outlook for 2022
Given the ongoing uncertainty relating to the Company’s Omolon royalty, Maverix is continuing to exclude attributable Omolon GEOs from its outlook for the second half of 2022. Excluding any contribution from the Omolon royalty in the second half, we continue to expect 28,000 to 31,000 attributable GEOs for 2022.
Asset Portfolio Updates
Omolon (2.5% GRR)
On November 2, 2022, Polymetal International plc announced that it is on track to meet its full year production guidance for fiscal 2022. In Q3, the Omolon mine produced approximately 56,000 ounces of gold and 100,000 ounces of silver. Polymetal also announced it has successfully completed the restructuring of its sales channels and started to unwind accumulated inventory. In late Q3, export sales resumed and Polymetal’s management team expects the gap between production and sales to be closed by the end of the year. The conflict between Russia and Ukraine and any restrictive actions that have or may be taken in response thereto, such as sanctions, export and or currency controls, have caused and could have further negative impacts on Polymetal’s ability to continue operation of Omolon and could further inhibit Polymetal’s ability to make payments to the Company. Maverix continues to work with Polymetal to effect payment of royalties from Omolon in a way that does not breach any relevant sanctions.
For more information, please refer to polymetalinternational.com and see the news release dated November 2, 2022.
Mt. Carlton (2.5% NSR)
On October 27, 2022, Navarre Minerals Ltd. (“Navarre”) announced that it had received notification from the Queensland Government of the final approval for an amendment to Mt Carlton’s Environmental Authority which allows for commencement of mining operations at the Mt Carlton United (“MCU”) gold-silver-copper deposit, located approximately 4 kilometres from the Mt Carlton processing facility. This approval is a significant milestone, securing the last hurdle to enable mining activities to proceed immediately, with first ore from the project expected to be delivered to the Mt Carlton processing facility in December 2022. The higher-grade material at MCU will provide the underlying driver for the improvement in production and costs. The MCU project is one of five potential satellite open pit deposits identified within the tenement package included in Navarre’s acquisition of the Mt Carlton operation in October 2021. Since acquiring Mt Carlton, Navarre’s commitment to invest in resource definition and exploration drilling has resulted in significant growth of the Mt Carlton mineral inventory, particularly at MCU.
For more information, please refer to navarre.com.au and see the news release dated October 27, 2022.
Moss (100% Silver Stream)
On October 31, 2022, Elevation Gold Mining Corp. announced the results from its recently completed reverse circulation resource definition and expansion drilling program at its Moss mine, which continues to demonstrate the high expansion potential of the mine. Recent drilling in the West Pit and Center Pit continued to intersect multiple stockwork vein zones in the hanging and footwalls to the main Moss and Ruth Veins confirming broadening of the system to the west and the presence of significant gold in the Ruth Vein beneath the Center Pit. A new reverse circulation drilling program will begin in November 2022 to further test mineralization near Center Pit and West Pit.
For more information, please refer to elevationgold.com and see the news release dated October 31, 2022.
Hope Bay (1% NSR)
On October 26, 2022, Agnico Eagle Mines Limited announced that exploration drilling at Hope Bay totaled 76,200 metres during the first nine months of 2022 and it is anticipated that approximately 100,000 metres will be completed in 2022. Most of this drilling was done at Doris, where three drill rigs are currently operating at surface and three rigs operating underground. Recent results continue to confirm and extend high-grade mineralization at depth. At Madrid, drilling continues to ramp up with two rigs now operating on surface. A second drill contractor has been mobilized to site to increase drilling capacity moving forward. Farther south in the Hope Bay belt at the Boston deposit, camp refurbishment has been completed and the site is ready for exploration drilling in 2023.
For more information, please refer to agnicoeagle.com and see the news release dated October 26, 2022.
The Company is pleased to announce that its Board of Directors has approved the payment of the quarterly cash dividend of $0.0125 per common share. The dividend will be paid on or about December 15, 2022, to shareholders of record as of the close of business on November 30, 2022.
The dividend is designated as an “eligible dividend” for the purposes of the Income Tax Act (Canada). Dividends paid by Maverix to shareholders outside Canada (non-resident investors) will be subject to Canadian non-resident withholding taxes. The declaration, timing, amount and payment of future dividends remains at the discretion of Maverix’s Board of Directors.
|(1) Please refer to the Non-IFRS Measures section at the end of this news release.|
Brendan Pidcock, P.Eng., is Vice President, Technical Services for Maverix, and a qualified person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”), has reviewed and approved the scientific and technical disclosure contained in this news release.
Maverix is a gold-focused royalty and streaming company with a globally diversified portfolio of over 140 assets. Maverix’s mission is to increase per share value by acquiring precious metals royalties and streams.
Collective Mining Ltd. (TSX-V: CNL) (OTCQX: CNLMF) is pleased to ... READ MORE
Ultra Lithium Inc. (TSX-V:ULT) (OTCQB: ULTXF) (Frankfurt: QFB) is... READ MORE
Discovery Silver Corp. (TSX: DSV) (OTCQX: DSVSF) is pleased to an... READ MORE
SKRR Exploration Inc. (TSX-V: SKRR) (FSE: B04Q) is pleased to an... READ MORE
Robex Resources Inc. (TSX-V: RBX) (FRA: RB4) is pleased to announ... READ MORE
We acknowledge the [financial] support of the Government of Canada.