Diversified Royalty Corp. Announces Fourth Quarter and Year End 2025 Results

Core Insights - Diversified Royalty Corp. reported financial results for Q4 2025 and the year ended December 31, 2025, highlighting a positive performance from its royalty partners with an overall weighted average organic royalty growth of 3.0% in Q4 2025 and 4.1% for the full year [3][7]. Financial Performance - Revenue for Q4 2025 was $19.1 million, an increase of 11.9% compared to $17.0 million in Q4 2024. For the year ended December 31, 2025, revenue reached $70.8 million, up 8.9% from $64.9 million in 2024 [7][9]. - Adjusted revenue for Q4 2025 was $20.4 million, reflecting an 11.2% increase from $18.4 million in Q4 2024. For the full year, adjusted revenue was $76.1 million, up 8.4% from $70.2 million in 2024 [7][9]. - Distributable cash for Q4 2025 was $13.6 million, a 7.9% increase from $12.6 million in Q4 2024. For the year, distributable cash was $50.5 million, up 12.7% from $44.8 million in 2024 [23][24]. Royalty Partner Performance - Mr. Lube + Tires, the largest royalty partner, achieved same-store sales growth (SSSG) of 7.2% in Q4 2025 and 9.5% for the year, driven by increased tire and maintenance sales [11]. - Stratus reported royalty income of $2.4 million for Q4 2025, with a fixed royalty payment increasing at a rate of 5% annually until November 2026 [12]. - Nurse Next Door generated a royalty entitlement of $1.4 million in Q4 2025, with a fixed growth rate of 2.0% per annum [13]. - Oxford Learning Centres achieved SSSG of 3.7% in Q4 2025, reflecting solid performance [17]. - Mr. Mikes experienced a slight decline in SSSG of -1.1% in Q4 2025 due to lower guest traffic [15]. - AIR MILES® saw a decline in royalty income of 7.9% in Q4 2025, attributed to ongoing softness in the rewards program [18]. Dividend and Payout Ratios - The payout ratio for Q4 2025 was 87.1%, compared to 82.3% in Q4 2024. For the year, the payout ratio was 88.1%, down from 90.0% in 2024 [26]. - Dividends declared per share were $0.0696 for Q4 2025 and $0.2634 for the year, reflecting an increase from $0.0625 and $0.2487 in the respective prior periods [26]. Net Income - Net income for Q4 2025 was $11.0 million, significantly up from $4.0 million in Q4 2024. For the year, net income was $36.7 million, compared to $26.6 million in 2024 [28].