Duke Capital Regulatory News (DUKE)

4 February 2021

Duke Royalty Limited

("Duke Royalty", "Duke" or the "Company")

Trading Update

Duke Royalty, a provider of alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and abroad, is pleased to provide the following trading and operational update for its third financial quarter ended 31 December 2020 ("Q3 FY21") and to provide guidance on trading for its fourth financial quarter ending 31 March 2021 ("Q4 FY21").

Highlights:

· Cash revenue for Q3 FY21, being cash distributions from Duke's Royalty Partners and cash gains from sales of equity assets, totalled £4.2m which represents a record quarter of cash revenue generation for Duke.

· Within the £4.2m of quarterly cash revenue, £1.7m related to the receipt of the redemption premium generated from the exit of Welltel, which occurred in December 2020. Once this positive effect is stripped out, like for like cash revenue for Q3 FY21 stood at £2.5m. This is in line with management's expectations and represents an increase from the £2.4m reported in Q2 FY21 and £2.0m in Q1 FY21.

· An IRR of 27% was generated from Duke's investment in Welltel. This was the Company's largest investment and represented the second exit of a royalty partner, further validating the Duke investment model.

· Based on current trading, Duke expects cash revenue for Q4 FY21 to be £2.5m, despite Welltel contributing no cash revenue in the quarter. Prior to exit, Welltel was delivering quarterly cash revenue of £450,000, highlighting the ongoing improvement in the cash generation of the existing portfolio.

· Duke also announced two separate follow-on transactions in December which included investments into MRDB Holdings Limited and BHPC Limited.

· As a result of the Welltel exit, the two new deployments in Q3 FY21 and the Step Investments deployment that closed in early January 2021, net debt currently stands at £5.6m, significantly below the £14.0m announced on 12 November 2020. This provides Duke with considerable liquidity for new investments.

· On 12 January 2021 Duke announced the appointment of Peter Madouros as Group Chief Investment Officer ("CIO"), in line with its planned succession strategy whereby Jim Webster, Duke's current CIO, will take up the role of Chairman of the Investment Committee. Duke is delighted to have Peter join the investment team while also retaining Jim's experience during both the due-diligence and deal execution process.

· Duke's pipeline remains strong and management is confident of being able to announce additional follow-on as well as new deployments in the near future, in line with market expectations.

Neil Johnson, CEO of Duke Royalty, said:

"I am pleased to report that cash revenue has continued to increase in Q3 FY21 in comparison to Q2 FY21, testament to the resiliency of our portfolio. In the quarter, Duke achieved one major exit and made two follow-on investments, while also expanding the investment team through the appointment of Peter Madouros as CIO.

"While the macro environment remains highly volatile, the pandemic has also presented Duke with a significant growth opportunity. Banks have been tightening SME lending criteria ever since the global financial crisis and demand for more flexible, alternative sources of capital remains very strong. As a first mover and leader in the UK and European corporate royalty space, Duke has a significant opportunity to build and further diversify its portfolio. Importantly, we have significant liquidity available for new deployments, which adds to our high level of confidence as we enter 2021."

***ENDS***

For further information, please visit www.dukeroyalty.com or contact:

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.