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Vox Royalty (VOXR) - 2024 Q3 - Quarterly Report
Vox Royalty Vox Royalty (US:VOXR)2024-11-06 21:07

Unaudited Condensed Interim Consolidated Financial Statements Statements of Financial Position As of September 30, 2024, total assets slightly increased to $53.02 million, total liabilities rose to $8.77 million, and total equity decreased to $44.24 million Consolidated Statement of Financial Position (Unaudited) | | September 30, 2024 ($) | December 31, 2023 ($) | | :--- | :--- | :--- | | Total Current Assets | 12,293,252 | 13,282,702 | | Total Non-current Assets | 40,722,821 | 39,423,907 | | Total Assets | 53,016,073 | 52,706,609 | | Total Current Liabilities | 3,776,246 | 2,903,950 | | Total Non-current Liabilities | 4,997,185 | 4,878,989 | | Total Liabilities | 8,773,431 | 7,782,939 | | Total Equity | 44,242,642 | 44,923,670 | | Total Liabilities and Equity | 53,016,073 | 52,706,609 | Statements of Income (Loss) and Comprehensive Income (Loss) For the nine months ended September 30, 2024, the company reported a net loss of $682,588, a significant shift from net income in 2023, primarily due to lower royalty revenue and higher income tax expense Financial Performance Summary (Unaudited) | Metric | Q3 2024 ($) | Q3 2023 ($) | Nine Months 2024 ($) | Nine Months 2023 ($) | | :--- | :--- | :--- | :--- | :--- | | Royalty Revenue | 2,428,809 | 3,514,929 | 8,150,438 | 9,313,168 | | Gross Profit | 1,887,501 | 3,109,818 | 6,408,628 | 7,906,163 | | Income from Operations | 276,726 | 1,898,856 | 1,095,658 | 2,324,096 | | Net Income (Loss) | (107,613) | 1,046,532 | (682,588) | 316,850 | | Basic EPS | (0.00) | 0.02 | (0.01) | 0.01 | | Diluted EPS | (0.00) | 0.02 | (0.01) | 0.01 | Statements of Changes in Equity Total equity decreased from $44.92 million at year-end 2023 to $44.24 million as of September 30, 2024, primarily due to net loss and dividends, partially offset by share-based compensation and dividend reinvestment Equity Reconciliation for Nine Months Ended Sep 30, 2024 | Description | Amount ($) | | :--- | :--- | | Balance, December 31, 2023 | 44,923,670 | | Dividends declared | (1,811,404) | | Shares issued – dividends reinvestment plan | 78,183 | | Settlement of RSUs | - | | Share-based compensation | 1,758,784 | | Net loss and comprehensive loss | (682,588) | | Share issue costs | (24,003) | | Balance, September 30, 2024 | 44,242,642 | Statements of Cash Flows For the nine months ended September 30, 2024, net cash from operating activities was $5.33 million, while investing activities used $3.16 million and financing activities used $2.21 million, resulting in a slight decrease in cash and cash equivalents to $9.30 million Cash Flow Summary (Unaudited) | Cash Flow Activity | Nine Months 2024 ($) | Nine Months 2023 ($) | | :--- | :--- | :--- | | Net cash from operating activities | 5,333,752 | 2,929,309 | | Net cash used in investing activities | (3,155,349) | (4,411,045) | | Net cash from (used in) financing activities | (2,206,116) | 5,802,793 | | Net increase (decrease) in cash | (27,713) | 4,321,057 | | Cash, beginning of period | 9,342,880 | 4,174,654 | | Cash, end of period | 9,301,289 | 8,459,526 | Notes to the Financial Statements Note 1: Nature of Operations Vox Royalty Corp. is a mining royalty company focused on acquiring royalties, with approximately 85% of its assets concentrated in Australia, Canada, and the United States - The company is a mining royalty company focused on accretive acquisitions14 - Approximately 85% of the Company's royalty assets are located in Australia, Canada, and the United States14 - The Company's common shares trade on the TSX and Nasdaq under the ticker symbol 'VOXR'13 Note 2: Basis of Preparation The unaudited condensed interim consolidated financial statements are prepared in United States dollars under IAS 34 and IFRS, consolidating company accounts, with no material impact from new accounting standards effective January 1, 2024 - The financial statements are prepared in accordance with IAS 34, Interim Financial Reporting, and do not include all disclosures required for annual statements15 - The statements are presented in United States dollars ($), which is the functional currency of the Company and its subsidiaries17 - Amendments to IAS 1 regarding non-current liabilities with covenants became effective January 1, 2024, but did not have a significant impact on the company's financial statements2124 Note 5: Royalty Interests Royalty interests increased to $38.87 million as of September 30, 2024, primarily due to the $3.14 million Castle Hill acquisition, with Australia remaining the largest portion of the portfolio - On May 14, 2024, the Company acquired the Castle Hill royalty portfolio in Australia for cash consideration of $3,119,81435 Royalty Interests by Country | Country | Sep 30, 2024 ($) | Dec 31, 2023 ($) | | :--- | :--- | :--- | | Australia | 31,296,236 | 29,859,470 | | Canada | 2,756,817 | 2,756,817 | | USA | 2,248,545 | 2,254,422 | | South Africa | 1,914,844 | 1,914,844 | | Brazil | 610,010 | 612,036 | | Peru | 45,609 | 45,609 | | Total | 38,872,061 | 37,443,198 | - Depletion expense for the nine months ended September 30, 2024, was $1,741,81032 Note 6: Credit Facility The company secured a $15 million revolving credit facility with BMO on January 16, 2024, maturing December 31, 2025, with no outstanding amounts drawn and full covenant compliance as of September 30, 2024 - The company entered into a $15,000,000 secured revolving credit facility with BMO on January 16, 202442 - As of September 30, 2024, there were no outstanding amounts under the facility and the company was in compliance with all covenants4243 Interest and Finance Expenses | | Q3 2024 ($) | Nine Months 2024 ($) | | :--- | :--- | :--- | | Amortization of Facility transaction costs | 58,716 | 166,362 | | Interest expense on Facility | 21,468 | 67,734 | | Total | 80,184 | 234,096 | Note 9: Share Capital The company declared three quarterly dividends of $0.012 per share in the first nine months of 2024, totaling $1,811,404, with $78,183 paid through its dividend reinvestment program Dividends Declared in 2024 | Declaration Date | Dividend per Share ($) | Record Date | Payment Date | Dividends Payable ($) | | :--- | :--- | :--- | :--- | :--- | | March 7, 2024 | 0.012 | March 29, 2024 | April 12, 2024 | 601,462 | | May 8, 2024 | 0.012 | June 28, 2024 | July 12, 2024 | 602,883 | | August 7, 2024 | 0.012 | Sep 27, 2024 | Oct 11, 2024 | 607,059 | | Total | 0.036 | | | 1,811,404 | - Total dividends paid included $78,183 paid in shares through the dividend reinvestment program, representing 36,063 common shares issued at a 5% discount55 Note 10: Equity Reserves During the first nine months of 2024, 3,600,000 warrants expired, while 240,000 stock options and 968,448 RSUs were granted, resulting in 1,346,838 options and 1,353,378 RSUs outstanding - All 3,600,000 outstanding warrants expired during the nine months ended September 30, 202456 - During the nine months ended September 30, 2024, the company granted 240,000 stock options and 968,448 RSUs5962 RSU Activity for Nine Months Ended Sep 30, 2024 | | Number of RSUs | Weighted Avg Fair Value ($) | | :--- | :--- | :--- | | Outstanding, beginning of period | 952,018 | 2.62 | | Granted | 968,448 | 2.00 | | Settled | (567,088) | 2.51 | | Outstanding, end of period | 1,353,378 | 2.22 | Note 15: Commitments and Contingencies The company faces a legal proceeding against Titan Minerals Limited for replacement royalties, potentially reversing a $1 million impairment, and has future commitments of $83,267 plus contingent milestone payments totaling approximately $9.57 million - The company has filed a statement of claim against Titan Minerals Limited seeking replacement royalties or damages for relinquished mining concessions in Peru, where a successful outcome could lead to the reversal of a $1,000,000 impairment charge taken in 2023757778 Contingent Milestone Payments | Royalty | Amount ($) | | :--- | :--- | | Limpopo | 6,593,081 | | Brits | 1,250,000 | | Bullabulling | 691,385 | | Koolyanobbing | 345,692 | | El Molino | 450,000 | | Other | 244,705 | | Total | 9,574,863 | Note 17: Segment Information The company operates in a single segment of royalty interest acquisition, with Australia being the primary source of $8.13 million (99.8%) of royalty revenue and the largest portion of non-current assets - The Company operates in one reportable segment, which is the acquisition of royalty interests82 Revenue by Geographic Location (Nine Months Ended Sep 30) | Location | 2024 ($) | 2023 ($) | | :--- | :--- | :--- | | Australia | 8,130,121 | 8,364,415 | | Nigeria | - | 882,922 | | Brazil | 4,812 | 50,326 | | USA | 15,505 | 15,505 | | Total | 8,150,438 | 9,313,168 | Non-Current Assets by Geographic Location | Location | Sep 30, 2024 ($) | Dec 31, 2023 ($) | | :--- | :--- | :--- | | Australia | 31,818,899 | 30,396,980 | | Canada | 3,050,399 | 3,027,846 | | USA | 2,248,545 | 2,254,422 | | South Africa | 1,914,844 | 1,914,844 | | Cayman Islands | 1,034,515 | 1,172,170 | | Brazil | 610,010 | 612,036 | | Peru | 45,609 | 45,609 | | Total | 40,722,821 | 39,423,907 | Note 19: Financial Instruments and Risk Management The company manages various financial risks including liquidity, currency, and commodity price exposure, with capital management focused on maximizing shareholder returns through accretive royalty acquisitions - The company manages liquidity risk by maintaining sufficient cash, utilizing its credit facility, and monitoring cash flows, with working capital at $8,517,006 as of September 30, 202489 - A 10% change in the Canadian and Australian dollar relative to the USD would impact net loss by approximately $525,00090 - The company's future revenue is not hedged, providing shareholders with full exposure to changes in the market prices of underlying commodities93 - The primary objective of capital management is to maximize shareholder returns by growing the asset base through accretive royalty acquisitions97 Note 20: Subsequent Events Following the end of the reporting period, on November 6, 2024, the Board of Directors declared a quarterly dividend for the fourth quarter - On November 6, 2024, the Board of Directors declared a quarterly dividend of $0.012 per common share, payable on January 14, 2025, to shareholders of record as of December 31, 202499