LONDON (Alliance News) - Mining royalty firm Anglo Pacific Group PLC on Wednesday reported a positive third quarter, despite a drop in the value of its Berkeley Energia PLC holding.
For the three months to September, total royalties were GBP12.1 million, up 27% year-on-year, with year-to-date royalties at GBP32.9 million from GBP28.9 million.
Commodity prices remained "resilient" across the period. Anglo Pacific's Maracas Machen investment royalty more than doubled to GBP1.4 million due to strong vanadium prices, while revenue from its Kestrel investment climbed 26% on higher coal prices.
Maracas Machen, in which Anglo Pacific has a 2% royalty agreement, is operating by Largo Resources Ltd in Brazil's Bahia State.
The Kestrel coal mine, in Australia's Queensland State, is operated by EMR Capital and PT Adaro Energy, which bought the site from Rio Tinto PLC in March.
There was a new contribution worth GBP900,000 from Anglo Pacific's recent Labrador Iron Ore Royalty Corp investment. Labrador Iron Ore has a royalty stake in a Rio Tinto-owned operation in Canada.
The contribution from Anglo Pacific's Australian Narrabri coal investment was lower than expected due to a longwall change-out, but Narrabri will recover going forward, it said.
London-listed Berkeley Energia was a disappointment. Anglo Pacific's investment value fell to around GBP3 million from GBP7 million in June, due to a steep share price drop on reports Berkeley Energia will not get permits for its flagship Salamanca uranium mine in Spain.
Looking to its dividend, Anglo Pacific said its dividend for its year ending January 31 will be at least 7 pence per share, the same as it paid in the prior year.
Chief Executive Julian Treger said: "With the addition of the Labrador Iron Ore investment, our portfolio has grown during the quarter by adding an additional immediate revenue stream whilst being aligned with our strategy of diversifying income sources, commodity and geographical exposure with a focus on premium quality products.
"Our portfolio continues to deliver growth with third quarter 2018 contributing GBP12.1 million taking total year to date royalty contributions to GBP32.9 million, an increase of 20% compared to the same period in 2017."
Treger added: "We remain in a very strong financial position and, with our new borrowing facility, have ample liquidity available to continue growing and diversifying our portfolio, building on the considerable progress we have made so far in 2018."
Shares were up 2.5% on Wednesday morning at a price of 132.25 pence each.
Berkeley Eng (BKY)