Triple Flag Precious Metals Corp. (with its subsidiaries,
“Triple Flag” or the “Company”) (TSX: TFPM, NYSE: TFPM) announced
its results for the second quarter of 2024 and declared a dividend
of US$0.055 per common share to be paid on September 16, 2024. All
amounts are expressed in US dollars, unless otherwise
indicated.
“Triple Flag is firmly on track to achieve sales guidance of
105,000 to 115,000 gold equivalent ounces (“GEOs”) for 2024,
following record performance in the first half of this year.
Northparkes delivered another quarter of stronger GEOs driven by
higher open-pit grades, which underpinned year-over-year growth of
25% in operating cash flow per share for the Company. Evolution
Mining has continued to demonstrate significant value creation as
the new operator of Northparkes during a recent analyst and
investor site visit. Most notably, a new sub-level cave has been
introduced into the potential mining sequence to establish a
steadier production profile from Northparkes through the next five
years and ahead of longer-term growth from the E22 orebody,”
commented Shaun Usmar, CEO.
“We remain disciplined towards capital allocation during this
period of strong precious metals prices and are pleased to announce
that the performance of our business has provided the basis for our
third consecutive annual increase of our dividend by 5% since we
listed in 2021. Our portfolio’s organic growth profile is strong
and well positioned to deliver long-term value, with expected sales
of 135,000 to 145,000 GEOs in 2028. Over the past month, Triple
Flag maintained a solid pace of accretive acquisitions with an
additional royalty interest in Tamarack as well as new gold streams
on the Agbaou and Bonikro mines. With current liquidity available
of nearly $640 million, we continue to advance an active and
actionable deal pipeline.
Finally, I am pleased to announce the promotion of Eban Bari to
Chief Financial Officer and James Dendle to Chief Operating
Officer, effective upon Sheldon Vanderkooy assuming the role of
Chief Executive Officer and Director in the fourth quarter of 2024.
The promotion of Eban and James is a testament to their expertise
and dedication as core members of Triple Flag’s high-performing
team, as well as their integral role in building this business into
the fourth-largest precious metals streaming and royalty company.
The CEO transition has progressed seamlessly ahead of my departure
in the fourth quarter of this year, which reflects the execution of
a multi-year succession development plan and the deep talent pool
at Triple Flag.”
Q2 2024 Financial Highlights
Q2
2024
Q2
2023
Revenue
$63.6 million
$52.6 million
Gold Equivalent Ounces
(“GEOs”)1
27,192
26,616
Net (Loss) Earnings (per
share)
($111.4 million) (-$0.55)
$16.0 million ($0.08)
Adjusted Net Earnings2 (per
share)
$26.3 million ($0.13)
$18.6 million ($0.09)
Operating Cash Flow
$49.4 million
$40.9 million
Operating Cash Flow per Share
$0.25
$0.20
Adjusted EBITDA3
$53.0 million
$42.1 million
Asset Margin4
92%
91%
GEOs Sold by Commodity and Revenue by Commodity
Three Months Ended June 30
($
thousands except GEOs)
2024
2023
GEOs1
Gold
16,124
17,134
Silver
11,068
8,215
Other
-
1,267
Total
27,192
26,616
Revenue
Gold
37,701
33,856
Silver
25,880
16,232
Other
-
2,503
Total
63,581
52,591
Corporate Updates
- 2024 GEOs Sales Guidance Maintained: Triple Flag remains
on track to achieve its sales guidance for 2024 of 105,000 to
115,000 GEOs. As previously announced, we expect the GEOs
contribution in 2024 from the higher-gold-grade E31 and E31N open
pits at Northparkes to be slightly higher in the second half of the
year compared to the first half due to the sequencing of mining and
processing activities.
- Quarterly Dividend Increased: Triple Flag’s Board of
Directors declared an increased quarterly dividend of US$0.055 per
common share that will be paid on September 16, 2024, to
shareholders of record at the close of business on August 30, 2024.
Triple Flag’s forward annualized dividend is now $0.22 per common
share, an increase of approximately 5% versus the previous
annualized dividend of $0.21 per common share. This represents the
Company’s third consecutive annual increase of the dividend since
its May 2021 initial public offering.
- Chief Executive Officer Transition: On July 23, 2024,
Triple Flag announced that Sheldon Vanderkooy will succeed Shaun
Usmar as Chief Executive Officer and Director, effective upon the
departure of Mr. Usmar, who is stepping down to assume a new
leadership role with a major diversified mining company. Mr. Usmar
will work closely with Mr. Vanderkooy to ensure a seamless
transition, anticipated to be finalized in the fourth quarter of
2024. Mr. Vanderkooy, a founding member of the Triple Flag team
since its inception in 2016, has played a pivotal role in the
Company’s growth trajectory over the past eight years. As a key
member of the senior management team, he has been an integral part
of building Triple Flag, starting with our first investment, the
Cerro Lindo silver stream. As Chief Financial Officer since 2019,
he was instrumental in delivering our successful $264 million
initial public offering in 2021. His extensive background includes
executive roles with First Quantum Minerals and Inmet Mining,
following a partnership at a leading Canadian law firm specializing
in mining M&A and financing transactions. With more than 25
years of experience in the mining sector, Mr. Vanderkooy brings a
wealth of strategic insight and leadership to his new position.
Refer to the July 23, 2024, press release on our website, Triple
Flag to Appoint Sheldon Vanderkooy as CEO and Director, for further
details.
- Management Appointments: Triple Flag Precious Metals is
pleased to announce the promotion of Eban Bari to Chief Financial
Officer and James Dendle to Chief Operating Officer, effective upon
Sheldon Vanderkooy assuming the role of Chief Executive Officer and
Director in the fourth quarter of 2024. The promotion of James and
Eban is a testament to their leadership and expertise as core
members of Triple Flag’s high-performing team, as well as their
integral role in building this business into the fourth-largest
precious metals streaming and royalty company. Eban, Vice
President, Finance, has been with Triple Flag for six years. He is
a CPA and is responsible for all finance functions, including tax
and treasury. James joined Triple Flag in 2017, after having
advised the Company in a technical capacity since inception. A
resource geologist by training with a multi-disciplinary
background, James heads corporate development for Triple Flag.
These promotions reflect Triple Flag’s commitment to recognizing
internal talent, a multi-year succession plan and that our true
competitive advantage has always been our exceptional team.
- Team Addition: On July 1, 2024, Fraser Cunningham joined
Triple Flag as Managing Director of Triple Flag International Ltd.,
based in Bermuda. An investment banker by training, Fraser has over
15 years of experience as a Managing Director at both Scotiabank
and Bank of America, working with a wide range of mining companies
and private equity groups providing financial evaluation expertise
on various M&A and capital market transactions, primarily in
precious and base metals. Select transaction experience with Triple
Flag includes the Company’s 2021 initial public offering and 2020
acquisition of the flagship Northparkes gold and silver stream.
Fraser holds an Honours Bachelor of Arts with distinction from the
Richard Ivey Business School of Western University and is a CFA
charterholder.
- Triple Flag to Acquire Gold Streams on Agbaou and
Bonikro. As previously announced on August 7, 2024, Triple Flag
has entered into definitive agreements for the acquisition of 3%
gold streams on each of the Agbaou and Bonikro producing gold mines
in Côte d'Ivoire, operated by Allied Gold Corp., for total cash
consideration of $53 million. Refer to the August 7, 2024, press
release on our website, Triple Flag to Acquire 3% Gold Streams on
Allied Gold Corp.’s Agbaou and Bonikro Mines, for further
details.
- Acquisition of Additional Tamarack Royalty: On July 5,
2024, Triple Flag acquired an additional 1.0% net smelter returns
(“NSR”) royalty from Talon Metals Corp. for total cash
consideration of $8 million (“Additional Tamarack Royalty”). The
royalty will be paid out of Talon’s participating interest in the
Tamarack nickel, copper, and cobalt project. Triple Flag also
received 8 million common share purchase warrants, each exercisable
to acquire one share of Talon Metals Corp. for an exercise price of
C$0.20 per share for a period of two years. The royalty is subject
to a buydown right to reduce the Additional Tamarack Royalty to
0.6% for $5 million, exercisable for a period of two years, subject
to certain conditions. The Additional Tamarack Royalty is in
addition to the 1.11% NSR royalty that Triple Flag already owns on
the Tamarack project.
- 2023 Sustainability Report Published: On June 25, 2024,
Triple Flag released its 2023 Sustainability Report entitled
“Resourcing Tomorrow”, showcasing the Company’s sustainability
approach, governance, and performance. Key highlights from this
report include the continued offset of all our Scope 1, 2 and 3
emissions to remain carbon neutral since inception, the investment
of nearly $470,000 by Triple Flag into specific initiatives to
support communities near our operators’ producing assets, and our
assistance in helping these communities access a total of $300,000
in additional funding from the World Gold Council by nominating
local initiatives focused on poverty reduction.
- Sustainalytics ESG Risk Rating Improvement: Subsequent
to quarter-end, Triple Flag was recognized by Morningstar
Sustainalytics as an ‘ESG Industry Top Rated’ and ‘ESG Regional Top
Rated’ company. Improving 25% from our 2023 rating, Triple Flag’s
new ESG Risk Rating of 6.7 (negligible risk) is a testament to the
commitment of our team and mining partners to ESG excellence as a
necessary requirement for maximizing long-term stakeholder returns
while limiting business disruption and maintaining the privilege to
operate in the regions we choose to invest. Triple Flag is now
ranked 2nd out of 118 companies in the global precious metals
sector.
Q2 2024 Portfolio Updates
Significant newsflow and milestones related to assets within our
portfolio announced during the second quarter of 2024 are detailed
below.
Australia:
- Northparkes (54% gold stream and 80% silver stream):
Sales from Northparkes in Q2 2024 were 6,620 GEOs, compared to
6,286 GEOs in Q1 2024 and 3,339 GEOs in Q4 2023. We continue to
expect higher grade open pit ore from E31 and E31N to contribute to
mill feed blend through at least 2025. In June 2024, Evolution
Mining hosted an analyst and investor site visit to showcase recent
developments and future growth strategies at Northparkes. Notably,
partial mining of E48 via a sub-level (“SLC”) cave is now being
contemplated, as E48 is a well-established mine that until December
2023 was being extracted by block cave. The introduction of a
potential SLC at E48 represents optimization of the mine plan under
Evolution’s operatorship as this portion of the upper area would
have been lost to dilution under the former block cave-only mine
plan. With the first SLC at E48 expected to be commissioned
starting from the second quarter of 2025, as well as the orebody’s
higher reserve grade of 0.41 g/t Au, the operator now expects
Northparkes to deliver a steadier production profile following the
depletion of the E31 and E31N open pits and through to
commissioning of E22. First production from the E22 orebody is now
expected during Evolution’s fiscal year ending June 30, 2029, with
a current reserve grade of 0.37 g/t Au. The average milled head
grade at Northparkes from 2021 to 2023, prior to the introduction
of the higher-gold grade E31 and E31N open pits, was approximately
0.15 g/t Au. For the E48 SLC, a pre-feasibility study is expected
to be completed in the first quarter of 2025. Currently, the mine
life for E48 SLC is expected to end in 2034. The E22 block cave
feasibility study was completed at the end of June 2024, as
planned, and is currently subject to review by the Evolution Board
of Directors. Additionally, a SLC and hybrid option study for E22
is expected to be completed by Evolution by June 30, 2025.
- Beta Hunt (3.25% GR gold royalty and 1.5% NSR gold
royalty): Royalties from Beta Hunt in Q2 2024 equated to
1,444 GEOs, an improvement from 1,214 in Q1 2024 due to the impact
of wet weather conditions on processing operations. On August 1,
2024, Westgold Resources Ltd. (“Westgold”) and Karora Resources
Inc. (“Karora”) closed the previously announced friendly merger
pursuant to which, Westgold has acquired 100% of the issued and
outstanding common shares of Karora. Completion of the transaction
is expected to create one of the top 5 largest, ASX-listed gold
producers operating exclusively in Western Australia with a strong
balance sheet, a significantly expanded exploration fleet to deploy
at Beta Hunt’s Fletcher zone, and a secondary TSX listing. The
expansion project to increase mine capacity at Beta Hunt to 2
million tonnes per annum remains on track for completion by the end
of 2024.
- Fosterville (2.0% NSR gold royalty): Royalties from
Fosterville in Q2 2024 equated to 901 GEOs. Fosterville is also
currently advancing an upgrade of the primary ventilation system to
sustain the mining rate in the Lower Phoenix zones in future years.
The operator expects the project to be completed by early 2025.
Fosterville continues to focus on productivity gains and cost
control at the mine and the mill to maximize throughput and reduce
unit costs to ensure that the asset remains a sustainable producer
of 175,000 to 200,000 ounces of gold annually.
Latin America:
- Cerro Lindo (65% silver stream): Sales from Cerro
Lindo in Q2 2024 were 8,584 GEOs. Ongoing exploration at Cerro
Lindo is primarily focused on extending the mineralization of near
mine targets known as Orebodies 8B, 9 and 6a, as well as the
Patahuasi Millay target located within Triple Flag’s stream area.
Assays returned during the second quarter of 2024 included 32.1
meters grading 4.56% Zn, 1.53% Pb and 80.33 g/t Ag at Orebody 8BC,
which compares to the current proven and probable silver reserve
grade of 22.6 g/ti.
- Camino Rojo (2.0% NSR gold royalty on oxides): Royalties
from Camino Rojo in Q2 2024 equated to 613 GEOs. 2024 production
guidance for the asset remains unchanged at 110,000 to 120,000
ounces of gold.
- Buriticá (100% silver stream, fixed ratio to gold):
Sales from Buriticá in Q2 2024 were 1,455 GEOs. Throughout the
second quarter of 2024, Buriticá was able to maintain steady
operations; however, due to the ongoing presence of illegal miners,
certain areas of the mine were avoided as a precautionary measure.
The mine site continues to engage closely with the surrounding
community on illegal mining and is supported by the National Army
and National Police of Colombia.
North America:
- Young-Davidson (1.5% NSR gold royalty): Royalties from
Young-Davidson in Q2 2024 equated to 677 GEOs. On May 14, 2024,
Alamos Gold Inc. (“Alamos”) released intercepts from underground
exploration drilling from the mid-mine, revealing a new style of
higher-grade gold mineralization in zones within the hanging wall
of the 100%-owned Young-Davidson producing mine. These zones are
located between 10 and up to 200 meters south of existing
infrastructure and reserves & resources, demonstrating
production upside potential with grades well above the current
reserve grade of 2.31 g/t Au. Highlight intercepts include: 7.41
g/t Au over 22 meters, 19.94 g/t Au over 4.55 meters, 5.24 g/t Au
over 9 meters and 10.73 g/t Au over 15.55 meters. A total of $12
million has been budgeted for exploration at Young-Davidson in
2024. As of December 31, 2023, Alamos estimates a mine life of
approximately 15 years for Young-Davidson based on current
underground mining rates.
- Florida Canyon (3.0% NSR gold royalty): Royalties from
Florida Canyon in Q2 2024 equated to 549 GEOs. A technical report
on Florida Canyon was released during the second quarter of 2024,
which highlighted average annual gold production of 70,000 ounces
from 2024 through 2030 under the current heap leach operation.
Alamos completed the previously announced acquisition of Argonaut
Gold on July 12, 2024, pursuant to which, Florida Canyon was spun
out to a newly created junior gold producer known as Florida Canyon
Gold Inc. This new operator also received $10 million from Alamos
in exchange for a 19.9% ownership interest following the spin-off.
On July 29, 2024, Integra Resources Corp. (“Integra”) announced a
friendly acquisition of Florida Canyon Gold Inc. The transaction is
expected to close in the fourth quarter of 2024.
- Gunnison and Johnson Camp Mine (3.5% to 16.5% copper
stream and 1.5% GR copper royalty): On May 15, 2024, Nuton LLC, a
Rio Tinto venture, announced that it has elected to proceed to
Stage 2 of a two-stage work program on the use of copper heap leach
technologies for primary sulphide mineralization at Excelsior
Mining’s 100%-owned Johnson Camp Mine (“JCM”) property in Arizona.
Triple Flag owns a 1.5% GR copper royalty on JCM, which is also
within the coverage area of the Company’s separate oxide copper
stream on Excelsior’s flagship Gunnison property. Under Stage 2,
Nuton will make a $5 million payment to Excelsior for the use of
existing infrastructure at JCM and will also be responsible for
funding all the operator’s costs associated with the five-year
milestone driven program. Successful completion of all milestones
would result in commercial production over several years. Mining is
expected to commence in 2024, with first Nuton copper production
expected in 2025. A leach pad permit was previously received in
2023, with two amendments expected to be completed in three to six
months for future JCM operations. The site has an existing and
fully operational SXEW processing plant. Revenue from JCM will be
used to pay back the costs of Stage 2 at Nuton and the fulfillment
of royalty and stream obligations, as well as other project costs.
Under a 2023 Preliminary Economic Assessment (“PEA”), JCM is
currently designed to produce 492 million pounds of copper over a
21-year mine life based on conventional open pit mining.
- Eskay Creek (0.5% NSR gold and silver royalty): During
the second quarter of 2024, Skeena Resources Ltd. (“Skeena”)
announced it has secured a $750 million financing package with
Orion Resource Partners to advance the 100%-owned Eskay Creek gold
and silver project to production. Skeena’s most recent initial
capital estimate for the project is $528 million from a November
2023 definitive feasibility study. Permitting for Eskay Creek is
expected to be completed by the end of 2025, with full construction
expected in 2026. First gold pour is expected in the first half of
2027.
- Hope Bay (1.0% NSR gold royalty): Exploration drilling
during the second quarter of 2024 returned strong infill results in
the Patch 7 area of the Madrid deposit, including 17.0 g/t gold
over 25.8 meters. This emerging new mineralized area continues to
show excellent continuity as well as grades and thicknesses greater
than average for the Madrid deposit. Agnico Eagle expects that the
2024 drilling in this area should have a positive impact on mineral
resources and on mining scenarios for potential project
redevelopment.
- DeLamar (2.5% NSR gold and silver royalty, partial
coverage): During the second quarter of 2024, Integra announced
that the mine plan of operations for the DeLamar heap leach project
has met the content permitting requirements by the US Bureau of
Land Management to proceed under the National Environmental Policy
Act (“NEPA”) process. A feasibility study on the project, which
will include mineralized stockpiles, is expected in the fourth
quarter of 2024. A Record of Decision (“ROD”) under the NEPA
process for DeLamar is slated to be received by the end of 2026. On
July 29, 2024, Integra announced a friendly acquisition of Florida
Canyon Gold Inc. The transaction is expected to close in the fourth
quarter of 2024.
- Updates on Pumpkin Hollow and Moss: On June 10, 2024,
Nevada Copper Corp. (“Nevada Copper”) announced that it filed for
creditor protection under Chapter 11 of the United States
Bankruptcy Code. As previously announced, we have not assumed any
GEO sales from Pumpkin Hollow in 2024. During its restructuring
period, Nevada Copper is pursuing a sales process and has retained
Moelis & Company LLC as an advisor. Our interests related to
the Pumpkin Hollow gold and silver stream are second secured
against all of Nevada Copper’s assets. Separately, our royalty
interests on the Pumpkin Hollow property have been registered
and/or otherwise recorded in the applicable state and federal
registries. An impairment charge of $104.1 million related to our
interests in Nevada Copper has been recorded in Triple Flag’s Q2
2024 financial statements. On July 30, 2024, Elevation Gold Mining
Corp. (“Elevation”) filed for creditor protection under the
Companies’ Creditors Arrangement Act. The Moss gold and silver heap
leach operation located in Arizona, USA has been placed under care
& maintenance. As previously disclosed, Elevation announced in
April 2024 that it had temporarily suspended silver stream delivery
obligations to Triple Flag. Our interests related to the Moss mine,
including the silver stream, are first secured against all of
Elevation’s assets. An impairment charge of $33.2 million related
to our interests in Elevation has been recorded in Triple Flag’s Q2
2024 financial statements.
Rest of World:
- Impala Bafokeng (70% gold stream): Sales from Impala
Bafokeng in Q2 2024 were 1,405 GEOs. On July 4, 2024, Impala
Platinum Holdings confirmed that the illegal work stoppage at the
North Shaft of the BRPM operation at Impala Bafokeng had been
resolved. The illegal strike action involving members of the
contractor workforce, who demanded permanent positions, commenced
on June 27, 2024.
- ATO (25% gold stream and 50% silver stream): Sales from
the ATO streams in Q2 2024 were 1,254 GEOs. On August 1, 2024, the
previously announced merger of Steppe Gold and Boroo Gold was
completed. The completion of this acquisition has established
Steppe Gold as the largest gold producer in Mongolia, providing
further financial strength, asset diversification and scale.
Commissioning of the ATO Phase 2 Expansion project remains on track
for the first half of 2026. Early works at site continue to
progress, which includes field work for a feasibility study,
geotechnical studies and trade-off studies to optimize the grinding
circuit and the use of Jameson cells versus conventional flotation.
These activities are expected to be completed by the end of
September 2024. Separately, WSP has been appointed a design
partner, focusing on the detailed engineering design for a new
flotation plant.
- Koné (2.0% NSR gold royalty): On May 9, 2024, Montage
Gold Corp. (“Montage”) announced that the 100%-owned Koné gold
project in Côte d’Ivoire received its environmental permit. An
Environmental and Social Impact Assessment was previously submitted
in December 2023. On July 10, 2024, Montage announced the receipt
of the mining permit for Koné. With the project now fully permitted
within the timelines previously guided by the operator,
construction is anticipated to begin in Q1 2025. On July 17, 2024,
Montage announced a C$180 million brokered private placement to
advance the Koné project, which includes a new strategic investment
by Zijin Mining in exchange for a 9.9% ownership interest. Upon
close in mid-August, the Lundin family is also expected to increase
their ownership interest in Montage to 19.9% from approximately
18%.
- Prieska (0.8% GR royalty and 84% gold and silver stream,
fixed ratio): Orion Minerals Limited (“Orion Minerals”) has now
completed trial mining of the supergene orebody in advance of the
updated feasibility study for the fully permitted Prieska copper
and zinc project, which remains scheduled for completion in the
second half of 2024.
Long-Term GEOs Sales Outlook
Triple Flag has updated our long-term GEOs sales outlook to
reflect recent developments including those at Nevada Copper and
Elevation, as well as current operator guidance.
We expect our business to deliver sales of 135,000 to 145,000
GEOs in 2028, a significant increase over current levels driven by
the following assumptions and operator guidance:
- Northparkes – The development of the E48 SLC as described
above.
- Cerro Lindo – Pursuant to the stream agreement, a step-down in
the stream rate from 65% to 25% starting in 2026.
- ATO – Production from Phase 2 commencing in 2026. We expect the
annual cap on our gold and silver streams to be fully effective in
2028.
- Pumpkin Hollow and Moss – We have not assumed any GEOs sales
from our stream and/or royalty interests.
- Gunnison and JCM – First Nuton copper production at JCM during
2025.
- Development and exploration stage assets – In the medium to
long term, deliveries from Eskay Creek (Skeena), Hope Bay (Agnico
Eagle), Koné (Montage), Prieska (Orion Minerals), Buffalo Valley
(SSR Mining Inc.), DeLamar (Integra), South Railroad (Orla Mining
Ltd.), Ana Paula (Heliostar Metals Ltd.), Fenn-Gib (Mayfair Gold
Corp.), Gemfield (Centerra Gold Inc.’s Goldfield project), and
Silvertip (Coeur Mining, Inc.).
The majority of the GEOs sales expected in 2028 are derived from
mines that are currently in production or supported by Mineral
Reserve and Mineral Resource estimates. Above and beyond 2028,
exists further optionality associated with exploration stage
projects that may be advanced to production during the period. Our
long-term sales outlook continues to be based on a metal price
assumption of $1,850/oz Au, $22/oz Ag and $4.00/lb Cu.
Conference Call Details
A conference call and live webcast presentation will be held on
August 8, 2024, starting at 9:00 a.m. ET (6:00 a.m. PT) to discuss
these results. The live webcast can be accessed by visiting the
Events and Presentations page on the Company’s website at:
www.tripleflagpm.com. An archived version of the webcast will be
available on the website for one year following the webcast.
Live Webcast:
https://events.q4inc.com/attendee/841971665
Dial-In Details:
Toll-Free (U.S. & Canada): +1 (888)
330-2384
International: +1 (647) 800-3739
Conference ID: 4548984, followed by #
key
Replay (Until August 22):
Toll-Free (U.S. & Canada): +1 (800)
770-2030
International: +1 (647) 362-9199
Conference ID: 4548984, followed by #
key
About Triple Flag Precious Metals
Triple Flag is a pure play, precious-metals‐focused streaming
and royalty company. We offer bespoke financing solutions to the
metals and mining industry with exposure primarily to gold and
silver in the Americas and Australia, with a total of 236 assets,
including 17 streams and 219 royalties. These investments are tied
to mining assets at various stages of the mine life cycle,
including 32 producing mines and 204 development and exploration
stage projects, and other assets. Triple Flag is listed on the
Toronto Stock Exchange and New York Stock Exchange, under the
ticker “TFPM”.
Qualified Person
James Lill, Director, Mining for Triple Flag Precious Metals and
a “qualified person” under NI 43-101 has reviewed and approved the
written scientific and technical disclosures contained in this
press release.
Forward-Looking Information
This news release contains “forward-looking information” within
the meaning of applicable Canadian securities laws and
“forward-looking statements” within the meaning of the United
States Private Securities Litigation Reform Act of 1995,
respectively (collectively referred to herein as “forward-looking
information”). Forward-looking information may be identified by the
use of forward-looking terminology such as “plans”, “targets”,
“expects”, “is expected”, “budget”, “scheduled”, “estimates”,
“outlook”, “forecasts”, “projection”, “prospects”, “strategy”,
“intends”, “anticipates”, “believes” or variations of such words
and phrases or terminology which states that certain actions,
events or results “may”, “could”, “would”, “might”, “will”, “will
be taken”, “occur” or “be achieved”. Forward-looking information in
this news release includes, but is not limited to, statements with
respect to the Company’s annual and five-year guidance, the payment
of a quarterly dividend, certain approved changes to the Company’s
management team, operational and corporate developments for the
Company, developments in respect of the Company’s portfolio of
royalties and streams and related interests and those developments
at certain of the mines, projects or properties that underlie the
Company’s interests, strengths, characteristics, the payment of a
dividend by the Company, the conduct of the conference call to
discuss the financial results for the second quarter of 2024, and
our assessments of, and expectations for, future periods
(including, but not limited to, the long-term sales outlook for
GEOs). In addition, any statements that refer to expectations,
intentions, projections or other characterizations of future events
or circumstances contain forward-looking information. Statements
containing forward-looking information are not historical facts but
instead represent management’s expectations, estimates and
projections regarding possible future events or circumstances.
The forward-looking information included in this news release is
based on our opinions, estimates and assumptions in light of our
experience and perception of historical trends, current conditions
and expected future developments, as well as other factors that we
currently believe are appropriate and reasonable in the
circumstances. The forward-looking information contained in this
news release is also based upon a number of assumptions, including
the ongoing operation of the properties in which we hold a stream
or royalty interest by the owners or operators of such properties
in a manner consistent with past practice; the accuracy of public
statements and disclosures made by the owners or operators of such
underlying properties; and the accuracy of publicly disclosed
expectations for the development of underlying properties that are
not yet in production. These assumptions include, but are not
limited to, the following: assumptions in respect of current and
future market conditions and the execution of our business
strategies; that operations, or ramp-up where applicable, at
properties in which we hold a royalty, stream or other interest
continue without further interruption through the period; and the
absence of any other factors that could cause actions, events or
results to differ from those anticipated, estimated, intended or
implied. Despite a careful process to prepare and review the
forward-looking information, there can be no assurance that the
underlying opinions, estimates and assumptions will prove to be
correct. Forward-looking information is also subject to known and
unknown risks, uncertainties and other factors that may cause the
actual results, level of activity, performance or achievements to
be materially different from those expressed or implied by such
forward-looking information. Such risks, uncertainties and other
factors include, but are not limited to, those set forth under the
caption “Risk and Risk Management” in our management’s discussion
and analysis in respect of the second quarter of 2024 and the
caption “Risk Factors” in our most recently filed annual
information form, each of which is available on SEDAR+ at
www.sedarplus.ca and on EDGAR at www.sec.gov. In addition, we note
that mineral resources that are not mineral reserves do not have
demonstrated economic viability and inferred resources are
considered too geologically speculative for the application of
economic considerations.
Although we have attempted to identify important risk factors
that could cause actual results or future events to differ
materially from those contained in the forward-looking information,
there may be other risk factors not presently known to us or that
we presently believe are not material that could also cause actual
results or future events to differ materially from those expressed
in such forward-looking information. There can be no assurance that
such information will prove to be accurate, as actual results and
future events could differ materially from those anticipated in
such information. Accordingly, readers should not place undue
reliance on forward-looking information, which speaks only as of
the date made. The forward-looking information contained in this
news release represents our expectations as of the date of this
news release and is subject to change after such date. We disclaim
any intention or obligation or undertaking to update or revise any
forward-looking information whether as a result of new information,
future events or otherwise, except as required by applicable
securities laws. All of the forward-looking information contained
in this news release is expressly qualified by the foregoing
cautionary statements.
Cautionary Statement to U.S. Investors
Information contained or referenced in this press release or in
the documents referenced herein concerning the properties,
technical information and operations of Triple Flag has been
prepared in accordance with requirements and standards under
Canadian securities laws, which differ from the requirements of the
U.S. Securities and Exchange Commission (“SEC”) under subpart 1300
of Regulation S-K (“S-K 1300”). Because the Company is eligible for
the Multijurisdictional Disclosure System adopted by the SEC and
Canadian Securities Administrators, Triple Flag is not required to
present disclosure regarding its mineral properties in compliance
with S-K 1300. Accordingly, certain information contained in this
press release may not be comparable to similar information made
public by U.S. companies subject to reporting and disclosure
requirements of the SEC.
Technical and Third-Party Information
Triple Flag does not own, develop or mine the underlying
properties on which it holds stream or royalty interests. As a
royalty or stream holder, Triple Flag has limited, if any, access
to properties included in its asset portfolio. As a result, Triple
Flag is dependent on the owners or operators of the properties and
their qualified persons to provide information to Triple Flag and
on publicly available information to prepare disclosure pertaining
to properties and operations on the properties on which Triple Flag
holds stream, royalty or other similar interests. Triple Flag
generally has limited or no ability to independently verify such
information. Although Triple Flag does not believe that such
information is inaccurate or incomplete in any material respect,
there can be no assurance that such third-party information is
complete or accurate.
Endnotes
Endnote 1: Gold Equivalent Ounces (“GEOs”)
GEOs are a non-IFRS measure that is based on stream and royalty
interests and calculated on a quarterly basis by dividing all
revenue from such interests for the quarter by the average gold
price during such quarter. The gold price is determined based on
the LBMA PM fix. For periods longer than one quarter, GEOs are
summed for each quarter in the period. Management uses this measure
internally to evaluate our underlying operating performance across
our stream and royalty portfolio for the reporting periods
presented and to assist with the planning and forecasting of future
operating results. GEOs are intended to provide additional
information only and do not have any standardized definition under
IFRS Accounting Standards and should not be considered in isolation
or as a substitute for measures of performance prepared in
accordance with IFRS Accounting Standards. The measures are not
necessarily indicative of gross profit or operating cash flow as
determined under IFRS Accounting Standards. Other companies may
calculate these measures differently. The following table
reconciles GEOs to revenue, the most directly comparable IFRS
Accounting Standards measure:
Three months ended
Six months ended
June 30,
June 30,
($ thousands, except average gold price
and GEOs information)
2024
2023
2024
2023
Revenue
63,581
52,591
121,109
102,860
Average gold price per ounce
2,338
1,976
2,203
1,932
GEOs
27,192
26,616
54,986
53,215
Endnote 2: Adjusted Net Earnings and Adjusted Net Earnings
per Share
Adjusted net earnings is a non‑IFRS financial measure, which
excludes the following from net earnings:
- impairment charges, write-downs, and reversals, including
expected credit losses;
- gain/loss on sale or disposition of assets/mineral
interests;
- foreign currency translation gains/losses;
- increase/decrease in fair value of investments;
- non-recurring charges; and
- impact of income taxes on these items.
Management uses this measure internally to evaluate our
underlying operating performance for the reporting periods
presented and to assist with the planning and forecasting of future
operating results. Management believes that adjusted net earnings
is a useful measure of our performance because impairment charges,
write-downs, and reversals, including expected credit losses,
gain/loss on sale or disposition of assets/mineral interests,
foreign currency translation gains/losses, increase/decrease in
fair value of investments, and non-recurring charges do not reflect
the underlying operating performance of our core business and are
not necessarily indicative of future operating results. The tax
effect is also excluded to reconcile the amounts on a post-tax
basis, consistent with net earnings. Management’s internal budgets
and forecasts and public guidance do not reflect the types of items
we adjust for. Consequently, the presentation of adjusted net
earnings enables users to better understand the underlying
operating performance of our core business through the eyes of
management. Management periodically evaluates the components of
adjusted net earnings based on an internal assessment of
performance measures that are useful for evaluating the operating
performance of our business and a review of the non-IFRS measures
used by industry analysts and other streaming and royalty
companies. Adjusted net earnings is intended to provide additional
information only and does not have any standardized definition
under IFRS Accounting Standards and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS Accounting Standards. The measures are not
necessarily indicative of gross profit or operating cash flow as
determined under IFRS Accounting Standards. Other companies may
calculate these measures differently. The following table
reconciles adjusted net earnings to net earnings, the most directly
comparable IFRS Accounting Standards measure.
Reconciliation of Net Earnings to Adjusted Net Earnings
Three months ended
Six months ended
June 30
June 30
($ thousands, except share and per share
information)
2024
2023
2024
2023
Net (loss) earnings
$
(111,437
)
$
16,034
$
(94,013
)
$
32,568
Impairment charges and expected credit
losses1
141,771
—
148,034
—
Loss on disposal of mineral interests2
—
1,000
—
1,000
Foreign currency translation gain
(55
)
(6
)
(95
)
(52
)
Decrease in fair value of investments
1,339
1,377
1,766
69
Income tax effect
(5,316
)
151
(6,185
)
254
Adjusted net earnings
$
26,302
$
18,556
$
49,507
$
33,839
Weighted average shares outstanding –
basic
201,249,986
202,041,353
201,195,314
196,938,120
Net (loss) earnings per share
$
(0.55
)
$
0.08
$
(0.47
)
$
0.17
Adjusted net earnings per share
$
0.13
$
0.09
$
0.25
$
0.17
- Impairment charges for the three and six months ended June 30,
2024 largely relate to the impairment of the Nevada Copper stream
and receivables and the Moss stream and receivables. Expected
credit losses for the three and six months ended June 30, 2024
primarily relate to expected credit loss provision for loan
receivables.
- Loss on disposal of mineral interests for the three and six
months ended June 30, 2023 represent the loss on the Eastern Borosi
NSR due to a buyback exercised by the operator.
Endnote 3: Adjusted EBITDA
Adjusted EBITDA is a non‑IFRS financial measure, which excludes
the following from net earnings:
- income tax expense;
- finance costs, net;
- depletion and amortization;
- impairment charges, write-downs, and reversals, including
expected credit losses;
- gain/loss on sale or disposition of assets/mineral
interests;
- foreign currency translation gains/losses;
- increase/decrease in fair value of investments;
- non-cash cost of sales related to prepaid gold interests;
and
- non‑recurring charges
Management believes that adjusted EBITDA is a valuable indicator
of our ability to generate liquidity by producing operating cash
flow to fund working capital needs, service debt obligations and
fund acquisitions. Management uses adjusted EBITDA for this
purpose. Adjusted EBITDA is also frequently used by investors and
analysts for valuation purposes, whereby adjusted EBITDA is
multiplied by a factor or ‘‘multiple’’ that is based on an observed
or inferred relationship between adjusted EBITDA and market values
to determine the approximate total enterprise value of a
company.
In addition to excluding income tax expense, finance costs net,
and depletion and amortization, adjusted EBITDA also removes the
effect of impairment charges, write-downs, and reversals, including
expected credit losses, gain/loss on sale or disposition of
assets/mineral interests, foreign currency translation
gains/losses, increase/decrease in fair value of investments,
non-cash cost of sales related to prepaid gold interests and
non-recurring charges. We believe these items provide a greater
level of consistency with the adjusting items included in our
adjusted net earnings reconciliation. We believe this additional
information will assist analysts, investors and our shareholders to
better understand our ability to generate liquidity from operating
cash flow, by excluding these amounts from the calculation as they
are not indicative of the performance of our core business and not
necessarily reflective of the underlying operating results for the
periods presented.
Adjusted EBITDA is intended to provide additional information to
investors and analysts and does not have any standardized
definition under IFRS Accounting Standards and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS Accounting Standards.
Adjusted EBITDA is not necessarily indicative of operating profit
or operating cash flow as determined under IFRS Accounting
Standards. Other companies may calculate adjusted EBITDA
differently. The following table reconciles adjusted EBITDA to net
earnings, the most directly comparable IFRS Accounting Standards
measure.
Reconciliation of Net Earnings to Adjusted EBITDA
Three months ended
Six months ended
June 30
June 30
($ thousands)
2024
2023
2024
2023
Net (loss) earnings
$
(111,437
)
$
16,034
$
(94,013
)
$
32,568
Finance costs, net
1,379
1,269
2,673
2,578
Income tax expense
260
1,626
2,978
2,992
Depletion and amortization
17,241
15,832
35,051
31,852
Impairment charges and expected credit
losses1
141,771
—
148,034
—
Loss on disposal of mineral interests2
—
1,000
—
1,000
Non-cash cost of sales related to prepaid
gold interests
2,463
4,921
4,636
10,481
Foreign currency translation gain
(55
)
(6
)
(95
)
(52
)
Decrease in fair value of investments
1,339
1,377
1,766
69
Adjusted EBITDA
$
52,961
$
42,053
$
101,030
$
81,488
- Impairment charges for the three and six months ended June 30,
2024 largely relate to the impairment of the Nevada Copper stream
and receivables and the Moss stream. Expected credit losses for the
three and six months ended June 30, 2024 primarily relate to
expected credit loss provision for loan receivables.
- Loss on disposal of mineral interests for the three and six
months ended June 30, 2023 represent the loss on the Eastern Borosi
NSR due to a buyback exercised by the operator.
Endnote 4: Gross Profit Margin and Asset Margin
Gross profit margin is an IFRS Accounting Standards financial
measure which we define as gross profit divided by revenue. Asset
margin is a non-IFRS financial measure which we define by taking
gross profit and adding back depletion and non-cash cost of sales
related to prepaid gold interests and dividing by revenue. We use
gross profit margin to assess profitability of our metal sales and
asset margin to evaluate our performance in increasing revenue,
containing costs and providing a useful comparison to our peers.
Asset margin is intended to provide additional information only and
does not have any standardized definition under IFRS Accounting
Standards and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
IFRS Accounting Standards. The following table reconciles asset
margin to gross profit margin, the most directly comparable IFRS
Accounting Standards measure:
Three months ended
Six months ended
June 30
June 30
($ thousands except Gross profit margin
and Asset margin)
2024
2023
2024
2023
Revenue
$
63,581
$
52,591
$
121,109
$
102,860
Less: Cost of sales
(24,677
)
(25,644
)
(48,946
)
(53,040
)
Gross profit
38,904
26,947
72,163
49,820
Gross profit margin
61
%
51
%
60
%
48
%
Gross profit
$
38,904
$
26,947
$
72,163
$
49,820
Add: Depletion
17,156
15,740
34,876
31,668
Add: Non-cash cost of sales related to
prepaid gold interests
2,463
4,921
4,636
10,481
58,523
47,608
111,675
91,969
Revenue
63,581
52,591
121,109
102,860
Asset margin
92
%
91
%
92
%
89
%
____________________
i Refer to Nexa’s press release dated March 27, 2024, “Nexa
Resources Announces 2023 Year-End Mineral Reserves and Mineral
Resources”.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240807770714/en/
Investor Relations: David Lee Vice President, Investor
Relations Tel: +1 (416) 304-9770 Email: ir@tripleflagpm.com
Media: Gordon Poole, Camarco Tel: +44 (0) 7730 567 938
Email: tripleflag@camarco.co.uk
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