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Maverix Metals Announces Record Financial Results for 2019 and Declares Quarterly Dividend

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Maverix Metals Announces Record Financial Results for 2019 and Declares Quarterly Dividend

 

 

 

 

 

Maverix Metals Inc. (NYSE American:MMX) (TSX: MMX) is pleased to announce record operating and financial results for the fourth quarter and year ended December 31, 2019.

 

For complete details please refer to the Financial Statements and associated Management Discussion and Analysis for the quarter and year ended December 31, 2019, available on SEDAR (www.sedar.com), EDGAR (www.sec.gov) or on the Company’s website (www.maverixmetals.com).

 

All dollar amounts are in Canadian dollars (“CAD”) unless otherwise indicated.

 

Full Year 2019 Financial Highlights

 

  • Record revenue of $44.7 million;
  • Record attributable gold equivalent ounces produced of 26,668 ounces1 and record attributable gold equivalent ounces sold of 24,0212;
  • Record cash flow from operating activities, excluding changes in non-cash working capital of $31.3 million2;
  • Record cash flow from operating activities of $27.7 million;
  • Average cash cost per attributable gold equivalent ounce sold of $217, resulting in cash operating margins of $1,645 per ounce2;
  • Adjusted net income of $9.2 million2;
  • Net loss of $10.2 million as a result of a non-cash impairment of $18.9 million on the fixed payment agreement from the Amulsar project; and
  • On March 4, 2020, Maverix’s Board of Directors declared a quarterly cash dividend of US$0.01 per common share to be payable on or about April 15, 2020, to shareholders of record as of March 31, 2020.

 

Fourth Quarter Financial 2019 Highlights

 

  • Revenue of $13.9 million;
  • Cash flow from operating activities, excluding changes in non-cash working capital of $10.6 million2;
  • Attributable gold equivalent ounces produced of 7,817 ounces1 and attributable gold equivalent ounces sold of 7,0962;
  • Average cash cost per attributable gold equivalent ounce of $226 resulting in cash operating margins of $1,729 per ounce2;
  • Adjusted net income of $4.0 million2; and
  • Net loss of $14.9 million as a result of a non-cash impairment of $18.9 million on the Amulsar project.

 

Dan O’Flaherty, CEO of Maverix, commented, “Maverix had another successful year in 2019, achieving record revenue of over $44 million, an increase of 31% from 2018 and achieving the upper end of our 2019 guidance. Maverix had many significant growth milestones throughout the year as we continued to build and strengthen our royalty and streaming portfolio with our fourth major portfolio acquisition since inception, listing on the NYSE American and the TSX as well as declaring the company’s inaugural quarterly dividend. We look forward to building on this success with further value creation in 2020.”

 

2020 Outlook

 

The Company continues to expect the previously announced guidance of attributable gold equivalent ounces to be between 27,000 and 30,000 ounces2 for 2020 with approximately 99% of expected revenue to be derived from gold and silver.

 

The Company intends to change its presentation currency for financial reporting and other disclosure from CAD to the United States dollar (“USD”) as part of the release of its first quarter results in 2020. The change in presentation currency is to better reflect the Company’s business activities and to improve investors’ ability to compare the Company’s financial results with other publicly traded precious metals royalty and streaming companies. The Company will apply the change to USD presentation currency retrospectively and restate the comparative financial information as if the new presentation currency had always been the Company’s presentation currency. All amounts in this news release are expressed in CAD, unless identified otherwise.

 

Summary of Quarterly and Annual Results

 

 

  Three months ended Year ended
(in thousands, except for Attributable Gold Equivalent ounce and per
share amounts)
  December 31,
2019
  December 31,
2018
  December 31,
2019
  December 31,
2018
Statement of Income and Comprehensive Income                
Royalty revenue $ 8,910 $ 7,126 $ 28,922 $ 27,361
Sales $ 4,968 $ 1,877 $ 15,810 $ 6,690
Total revenue $ 13,878 $ 9,003 $ 44,732 $ 34,051
Cash flow from operating activities $ 9,717 $ 11,081 $ 27,674 $ 22,792
Net (loss) income $ (14,925) $ 1,145 $ (10,178) $ 2,711
Basic (loss) earnings per share $ (0.14) $ 0.01 $ (0.09) $ 0.03
Dividends declared per share $ 0.01 $ 0.00 $ 0.01 $ 0.00
                 
Non-IFRS and Other Measures2                
Adjusted net income $ 3,982 $ 694 $ 9,228 $ 3,480
Total Attributable Gold Equivalent ounces produced1   7,817   5,176   26,668   21,044
Total Attributable Gold Equivalent ounces sold   7,096   5,650   24,021   20,886
Average realized gold price per Total Attributable
Gold Equivalent ounce sold
$ 1,956 $ 1,593 $ 1,862 $ 1,630
Average cash cost per Total Attributable Gold
Equivalent ounce sold
$ 226 $ 164 $ 217 $ 162
Cash flow from operating activities, excluding
changes in non-cash working capital
$ 10,577 $ 6,988 $ 31,336 $ 24,495

 

 

Dividend

 

The quarterly cash dividend of US$0.01 per common share will be paid to shareholders of record as of the close of business on March 31, 2020, and will be distributed on or about April 15, 2020.

 

This dividend is designated as an “eligible dividend” for the purposes of the Income Tax Act (Canada). Dividends paid by Maverix to shareholders outside Canada (non-resident investors) will be subject to Canadian non-resident withholding taxes. The declaration, timing, amount and payment of future dividends remains at the discretion of the Company’s Board of Directors.

 

 

1 Represents the Company’s entitlements under its royalty and stream agreements to the gold equivalent ounces of silver and gold contained in concentrate or doré prior to smelting or refining deductions. Silver production is converted to an attributable gold equivalent ounce produced basis by multiplying the attributable silver production at the underlying operation by the LBMA Silver Price for the same respective period and then dividing by the average gold price based on the LBMA Gold Price PM Fix per ounce for the same respective period. Production figures are based on information provided by the operators of the mining operations to which the silver and gold interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received. Ounces produced exclude silver ounces to be delivered under the minimum required ratio of silver to actual gold production from the Company’s Moss silver stream.
2 Maverix has included certain performance measures in this press release that do not have any standardized meaning prescribed by International Financial Reporting Standards (IFRS) including average cash cost per attributable gold equivalent ounce and cash operating margin. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate cash flow. Average cash cost per attributable gold equivalent ounce is calculated by dividing the total cost of sales, less depletion, by the ounces sold. In the precious metals mining industry, this is a common performance measure but does not have any standardized meaning. Cash operating margin is calculated by subtracting the average cash cost per ounce from the average realized selling price per ounce of gold. The Company presents cash operating margin as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other companies in the precious metal royalty and streaming sector who present results on a similar basis. The Company’s royalty revenue and silver sales are converted to an Attributable Gold Equivalent ounce basis by dividing the royalty revenue and silver sales for a period by the average gold price based on the LBMA Gold Price PM Fix per ounce for the same respective period. These attributable gold equivalent ounces when combined with the gold ounces sold from the Company’s gold streams (individually and collectively referred to as “Attributable Gold Equivalent”) equal total Attributable Gold Equivalent ounces sold. The Company has also used the non-IFRS measure of operating cash flows excluding changes in non-cash working capital. This measure is calculated by adding back the decrease or subtracting the increase in changes in non-cash working capital to or from cash provided by (used in) operating activities. The presentation of this non-IFRS measure is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these non-IFRS measures differently. The 2020 forecast provided herein assumes a gold price of US$1,400 per ounce, a silver price of US$16.00 per ounce and a USD to CAD exchange rate of 1.30. The production forecast was derived using information that is available in the public domain as at the date hereof, which included guidance and estimates prepared and issued by management of the operators of the mining operations in which Maverix holds an interest. The production forecast is sensitive to the performance and operating status of the underlying mines. None of the information has been independently verified by Maverix and maybe subject to uncertainty. There can be no assurance that such information is complete or accurate.

 

 

Qualified Person

 

Doug Ward, B.Sc., Mining Engineering, MMSA, is Vice President Technical Services for Maverix, and a qualified person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects, has reviewed and approved the scientific and technical disclosure contained in this press release.

 

About Maverix

 

Maverix is a gold-focused royalty and streaming company with a globally diversified portfolio of over 100 assets, of which 13 are currently paying. Maverix’s mission is to increase per share value by continuing to add new precious metals royalties and streams.

 

Posted March 5, 2020

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