AUS
NZ
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CA
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Highlights
- DRR's MAC (Mining Area C) asset drove revenue growth, with a 5% YoY increase to AUD 241 million.
- The company declared a total dividend of 29.29 cents per share, representing 100% of NPAT.
- DRR acquired Trident Royalties plc, making a significant contribution to DRR’s portfolio.
Deterra Royalties Limited (ASX:DRR) is an Australian company which develops and manages a portfolio of royalty assets across a range of commodities including, bulk, base and battery metals. The company utilises a transparent and simple business model with a focus on dividends and high margins.
The full year results for the financial year 2024 (FY24) demonstrate the high margin business model of DRR along with efficiency of cornerstone MAC (Mining Area C) assets, informed DRR MD, Julian Andrews.
During the reported period, MAC asset contributed the most in revenue growth as its revenue surged by nearly 5% YoY to AUD 241 million, underpinned by 13% increase in iron ore prices, partially offset by decrease in sales volume. In FY24, EBITDA grew by 3.92% to AUD 227.9 million and net profit after tax surged by 1.57% YoY to AUD 155 million.
Dividend announcement
During the year, the company announced a total dividend of 29.29 cents per share, including interim dividends of 14.89 cps and final dividend of 14.40 cps. The total fully franked dividend represents 100% of NPAT.
In the corporate presentation dated 2 September 2024, the company stated that it targets a minimum dividend payout ratio of 50% of NPAT, franked to the extent possible.
Recent acquisition
Through an ASX update, the company notified that its scheme of arrangement to acquire Trident Royalties plc has become effective. With this transaction, Trident become a wholly owned subsidiary of DRR, adding to its diverse portfolio of 22 assets spanning 11 countries.
Company outlook
The company is committed to undertake additional growth opportunities across base, bulk and battery metals and is continuously evaluating value-accretive acquisitions to expand the portfolio, backed by liquidity and access to AUD 500mn in undrawn credit facilities.
The royalty business model of DRR is efficient and assisted in maintaining EBITDA margins at 95% in FY24. These margins are expected to sustain in FY25, supported by low-cost characteristics of royalty model and significant productivity of MAC asset.
The recent acquisition adds lithium and copper royalties to DRR portfolio, which provides exposure to long-term demand growth in battery metals.
Share performance of DRR
DRR shares closed 2.83% lower at AUD 3.78 apiece on 9 October 2024. In the past one year, DRR’s share price has dropped 20.42%, while in the past one month, the share price has increased by 10.20%.
52-week high of DRR is AUD 5.56, recorded on 31 January 2024, and 52-week low is AUD 3.32, recorded on 9 September 2024.
DRR Daily Technical Chart, Source: EODHD/Others
Note 1: Past performance is neither an Indicator nor a guarantee of future performance.
Note 2: The reference date for all price data, and currency, is 09 October 2024. The reference data in this report has been partly sourced from EODHD/Others.
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