Scully Royalty .(US:SRL)2024-12-31 13:30Revenue Performance - Revenue for the first half of 2024 decreased to $18.1 million from $26.5 million in the same period of 2023, primarily due to a decrease in royalty income and the disposition of hydrocarbon properties in 2023 [79]. - Gross revenues for the six months ended June 30, 2024, were $18,093,000, a decrease of 31.6% compared to $26,506,000 in the same period of 2023 [188]. - Revenue from external customers in the Merchant Banking segment was $10,595, while the Royalty segment generated revenue of $3,162, contributing to over 75% of total revenue [226]. - Royalty revenue from an iron mine operator represented approximately 58% of total revenue for the six months ended June 30, 2024, compared to 56% in 2023 [229]. Costs and Expenses - For the six months ended June 30, 2024, total costs of sales and services decreased to $4.4 million from $10.7 million in the same period of 2023, representing a reduction of approximately 59% [83]. - The total costs of sales and services for the six months ended June 30, 2024, were $4,366, down from $10,724 in the same period of 2023 [230]. - Selling, general and administrative expenses decreased to $11.1 million in the first half of 2024 from $11.6 million in the same period of 2023 [86]. Profitability and Loss - The net loss attributable to shareholders for the first half of 2024 was $19.9 million, or $1.34 per share, compared to a net income of $0.9 million, or $0.06 per share, in the same period of 2023 [90]. - The company faced a total comprehensive loss of $17,684,000 for the six months ended June 30, 2024, compared to a comprehensive loss of $1,402,000 in 2023 [192]. - The income (loss) before income taxes for the six months ended June 30, 2024, was $(16,915), significantly down from $4,453 in the same period of 2023, including an impairment loss of $18,579 on assets held for sale [226]. Cash Flow and Liquidity - Cash flows used in operating activities amounted to $16.0 million for the six months ended June 30, 2024, compared to cash provided of $30.3 million in the same period of 2023 [106]. - Cash and cash equivalents decreased to $35,897,000 as of June 30, 2024, from $78,252,000 at December 31, 2023 [186]. - The company’s cash flows from investing activities provided $4,464,000 in the first half of 2024, compared to $32,000 in 2023 [199]. Asset Management - The company recognized a non-cash impairment charge of $18.6 million in connection with the rationalization of non-core assets in the first half of 2024 [66]. - The company reported an impairment loss of $18,579,000 on assets held for sale during the first half of 2024, compared to a reversal of impairment loss of $1,247,000 in the same period of 2023 [199]. - As of June 30, 2024, total current assets increased to $172.3 million from $164.5 million as of December 31, 2023, driven by the addition of assets held for sale valued at $52.3 million [109]. Shareholder Information - The company declared a dividend of US$0.26 per common share to be paid on February 21, 2025, to shareholders of record on January 24, 2025 [67]. - No dividends were paid during the six months ended June 30, 2024; however, a dividend of $0.23 per common share was paid in May 2023 [232][233]. - The company’s cash dividends paid were $3,421,000 in 2023, with no dividends paid in the first half of 2024 [199]. Financial Position - The net debt-to-equity ratio as of June 30, 2024, was 0.1%, indicating a low level of leverage compared to the previous period where it was not applicable due to a net cash position [97]. - Total liabilities decreased slightly to $121,151,000 as of June 30, 2024, compared to $122,797,000 at December 31, 2023 [186]. - The company’s total equity decreased to $311,986,000 as of June 30, 2024, from $329,670,000 at the end of 2023 [186]. Currency and Economic Factors - The Canadian dollar weakened by approximately 0.2% against the Euro as of June 30, 2024, compared to the end of 2023, resulting in a net currency translation adjustment gain of $2.1 million [71]. - Inflation has had a minimal impact on costs over the last two fiscal years, not considered a significant risk [125]. Regulatory and Compliance - The company maintains internal controls over financial reporting to provide reasonable assurance of reliability in accordance with IFRS [167]. - The company is currently assessing the impacts of new standards and amendments issued by the IASB, including IFRS 18 and amendments to IFRS 9 and IFRS 7 [150][154].