Deterra Royalties
Financials:
Primary ticker: ASX:DRR
Stage of development: Production
Primary minerals: Bulk, Base and Battery Metals
Project to promote: Mining Area C
Project location: Australia
Website: www.deterraroyalties.com
Deterra Royalties is based in Perth and is listed on the ASX. Established as an independent company in 2020, the Company’s principal activity is the management and growth of a portfolio of royalty assets across a range of commodities, primarily focused on bulks, base and battery metals. Deterra’s existing portfolio includes royalties held over Mining Area C, our cornerstone asset, in the Pilbara region of Western Australia, as well as five smaller royalties including Yoongarillup/Yalyalup, Wonnerup, Eneabba and St Ives.
Cash: AUD24M
Debt: NIL
Major shareholders:
Iluka Resources – 20%
Perpetual Limited – 15%
Schroders – 7%
Management Ownership – 0.1%
Management Profile
Julian Andrews – MD and CEO
Mr Andrews’ experience spans over 20 years in broad project finance, capital raising and mergers and acquisitions across the mining, energy, and chemicals industry landscape. Prior to his appointment as Managing Director, Mr Andrews was Head of Strategy, Planning and Business Development at Iluka Resources and previously held various roles at Wesfarmers, including General Manager Business Development and Chief Financial Officer in Wesfarmers Chemicals, Energy & Fertilisers Division.
What is your rationale for taking part 121 Mining Investment?
Deterra Royalties, is a recently listed royalty company, with a high quality royalty portfolio and a A$2.4B market capitalisation. As part of our ongoing market engagement activities, we are looking to build our profile and investor awareness in the EMEA region.
What recent news would you like to highlight to investors attending?
Deterra Royalties recently released its half-year report for FY22 which showed strong financial performance with revenue of A$92.8 million and an NPAT of A$61.7 million.
Through out the half-year strong operational performance was seen at Mining Area C as production volumes increased to 49.2 million wet metric tonnes, up 45% HoH through the ramp-up of South Flank, which remains on track to increase production to 145 million wet metric tonnes per annum by the end of FY24.
Deterra’s credit facility was refinanced and expanded to A$350 million at lower margins and longer tenor as the Company invests in business development capability.
Deterra continues to prioritise shareholder returns and declared an interim dividend of 11.68¢/sh representing 100% of NPAT.
What do you see as the key risks and challenges facing your company at the moment and how are you overcoming these?
– We offer investors exposure to one of the world’s highest quality royalties. Our Mining Area C (MAC) royalty covers the largest iron ore hub in the world, operated by BHP, the world’s largest mining company.
– Our business model offers high margins, and a dividend policy paying out 100% of NPAT, fully franked.
– Our royalty portfolio offers organic growth, through the South Flank project which remains on track to lift MAC volumes to 145 million wet tonnes per annum. We also offer exposure to a growth mandate that intends to deliver patient and disciplined value accretive M&A.
– We are targeting a net zero operational GHG footprint in FY22 and a M&A strategy that fully integrates ESG into the investment process.