Last checked at 29 Dec 2023 07:00
29 December 2023
Duke Royalty Limited
("Duke Royalty", "Duke" or the "Company")
Trading Update and Follow-on Investment
Duke Royalty, a provider of alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and North America, is pleased to provide guidance on its trading for its third financial quarter ending 31 December 2023 ("Q3 FY24") and to announce a follow-on investment of CA$8.6 million (approximately £5.1 million) into its existing royalty partner Cre?-Tech Industrial Group Inc. ("Cre?-Tech").
Trading Update
Based on current trading, Duke expects to achieve recurring cash revenue* of £6.3 million in Q3 FY24. This represents a 12% increase on Q3 FY23 (£5.6 million) and an increase on the prior quarter, Q2 FY24, which saw the Company deliver record recurring cash revenue of £6.2 million.
Overview of quarterly revenue growth:
| Recurring Cash Revenue* | Total Cash Revenue** |
Q2 FY23 | £5.3 million | £5.3 million |
Q3 FY23 | £5.6 million | £5.6 million |
Q4 FY23 | £5.7 million | £5.8 million |
Q1 FY24 | £6.0 million | £7.8 million |
Q2 FY24 | £6.2 million | £6.2 million |
* Recurring cash revenue excludes buyback premium receipts and cash gains from equity sales
** Total cash revenue is monthly cash distributions from Duke's royalty partners plus cash gains received from the sales of equity assets and buyback premiums
Other Highlights
· In December, Duke invested a further CA$8.6 million into Cre?-Tech, taking its total exposure to CA$27.1 million (£16.0 million). The investment will be used to facilitate the refinancing of its existing senior lender.
· During the quarter, Duke strengthened its investment team adding two new associate hires to take advantage of the current market opportunities.
· Duke also embarked on a review of the Company's branding and positioning. This review is still ongoing, and the Board looks forward to sharing these exciting changes upon completion in the next quarter.
Neil Johnson, CEO of Duke Royalty, said:
"We are pleased to report that despite the ongoing macroeconomic uncertainties, we continue to deliver revenue growth, with Q3 FY24 on course to maintain this upward trend, underpinning our stable dividend which at the current share price, represents an approximate 9% yield.
"We believe the Company's rebrand, alongside our expanded investment team, will position Duke to take advantage of the abundance of new opportunities in the Private Credit market, which has become increasingly mainstream in the SME lending space."
***ENDS***
For further information, please visit www.dukeroyalty.com or contact:
Duke Royalty Limited | Neil Johnson / Charles Cannon Brookes / Hugo Evans
| +44 (0) 1481 231 816 |
Cavendish Capital Markets Limited (Nominated Adviser and Joint Broker) | Stephen Keys / Callum Davidson / Michael Johnson
| +44 (0) 207 220 0500
|
Canaccord Genuity (Joint Broker)
| Adam James / Harry Rees | +44 (0) 207 523 8000 |
SEC Newgate (PR) | Elisabeth Cowell / Alice Cho / Matthew Elliott | +44 (0) 20 3757 6882 dukeroyalty@secnewgate.co.uk |
About Duke Royalty
Duke Royalty Limited provides alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and abroad. Duke Royalty's experienced team provide financing solutions to private companies that are in need of capital but whose owners wish to maintain equity control of their business. Duke Royalty's royalty investments are intended to provide robust, stable, long term returns to its shareholders. Duke Royalty is listed on the AIM market under the ticker DUKE and is headquartered in Guernsey.