Ecora Royalties PLC

Good afternoon, everybody. Thank you very much for joining the eCorra Resources half year 2025 results presentation. I'm joined today by Mark Bishop-Lafleche, our chief executive, Kevin Flynn, chief financial officer. I'm Geoff Callow, the head of investor relations. Mark and Kevin will take you through a presentation detailing our half year results. At the start of that, you'll find a disclaimer, which relates to forward-looking statements, which we won't dwell on, but please be aware of that. And finally, there'll be an opportunity for anybody at the end of the presentation to ask any questions you may have. With that, I'll hand over to Mark.

Thank you for joining us today. We are excited to present our first half 2025 results. During the period, we saw very strong volume and revenue growth in our critical minerals portfolio, in particular from base metals. A very strong continued ramp up at Voisey's Bay mine and is currently carrying forward into the third quarter. We saw record production and revenue from the Mantos Blancos copper royalty. And the period saw the first income from the Mambula stream, which we acquired in late Q1. As a post-period event, we entered into an agreement to sell the non-core development stage Dugby Gold Royalty, and this accelerates the group's deleveraging following the Mimbula Stream acquisition earlier in the year and provides Acora with greater flexibility to reallocate the capital in the future should an opportunity present itself. As I mentioned just now, it was very pleasing to see our producing critical minerals royalties increasingly demonstrate their underlying cash generation potential during the first half of 2025. Over the calendar year 25, we expect it to be the first year in ECORA's history when more than 50% of our revenue is generated in connection to critical minerals. And that's assuming current commodity prices, which represents a significant milestone in this company's evolution from 20% base metals in 2020 to an expected 85% in 2030 with copper at the core. So 2025 really does appear, in our view anyways, to represent a potential inflection point for ECORA, as this company transitions from historically being linked to a single commodity with a relatively short life to being much more diversified in terms of counterparties, commodities, and most importantly, perhaps, underpinned by royalties over mines that have production horizons that are measured in decades rather than years. I just mentioned the Dugbee royalty sale, and this is certainly an example of value that doesn't appear to have been priced into the eCore shares. We believe there is substantial value beyond the core producing royalty asset base. And as part of the Dugbee transaction, it's really great to demonstrate this and unlock value as part of that transaction. So with that, I'll hand it over to Kevin to run through the financials.

Thanks, Mark. My first slide, as always, summarizes our financial performance in the period. And I think just to deal with that at the outset, if we look at the comparative periods across these charts in 23 and 24, these illustrate the inverse of what we're currently seeing with the timing of Kestrel being within our private royalty area. So in 23 and 24, we saw the vast majority of our full year contribution being earned in the first half of the year. We're expecting that dynamic to reverse in 2025. So in effect, the green box for H125 is more comparable to the lighter blue columns within the previous years. And what we've done here is we've just put in a dotted line to show where the broker consensus numbers are looking at for the rest of the year across these KPIs, showing how we expect the portfolio to catch up as we go through the second half of the year. Now, that's not to say, of course, that this catch-up is solely driven by Kestrel. That would be to do a disservice to the fantastic progress and momentum we've seen from our base metals portfolio in the first half of this year, which was up 81% on the previous year. And there's some very good tailwinds, both volume-driven and pricing, to suggest that there's more to come in the second half of the year. Portfolio contribution in its usual way carries across into our adjusted earnings per share and our free cash flow graphs as always. Just one other thing to pick up on, the total dividend for the first half of the year announced was 0.6 cent per share and that's very much in line with our capital allocation policy paying out approximately 25% of our free cash flow. Turning to the next slide, which is our portfolio contribution in a little more detail. As I said, the headline number here and the reduction of 65% doesn't really tell the full story. If we go further up the page and look at our base metals portfolio, which, as I mentioned, increased by 81%, we certainly want to highlight the Voices Bay and the Mantos Blancos assets as key drivers of this increase. Looking at Voices Bay first, we're very pleased that the ramp up and the transition to the underground mine is now firmly established. And for the first period, really, this is coming through our income statement, reporting more than double revenue. And Mark will touch on the reasons why we're very confident with what we received in Q3 to date and the outlook for the rest of the year in a moment. The other side to this coin, of course, is the cobalt price. The DRC introduced an export ban on cobalt in the first quarter of this year, which has created a stability in the cobalt price around about the 18 to 20 dollar per pound level, which has remained pretty firm in the period. This export ban was extended and is due to end at the end of September. Many commentators think that further price stabilization mechanisms will be implemented by the DRC government at this stage. But it's worth remembering that before this export ban was put in place, the cobalt price was around about $13 a pound. So we've received some very positive uplift in terms of both volume and pricing from this asset, both of which look set to continue. Mantos was another stellar performer in the portfolio, up 35% in the period. This was mainly volume-driven, as the operator Capstone has announced three consecutive months of record levels of production. Again, we expect very good momentum to come here going forward, and Mark will touch on that again a little later. But this positive and record levels of outcome is coming when the copper price rises. which did experience some volatility earlier on in the year around tariff disruptions, has now bounced back to about $10,000 a ton, whereas post-tariff it traded down to about $8,000. So again, with price and volume tailwinds here, we expect a good finish to the year. The Mumbula copper acquisition, this one really doesn't tell the full story. Given the way the stream is structured, the revenue recognition point is based on the receipt of the copper and the sale of those units. We usually receive those units and sell them immediately in the week after the quarter end date. So the revenue recognition period is is the first week of the quarter. So actually, the 0.7 million received here relates to February and March of 2025. It doesn't include 1.4 million we've sold already in Q3, which was based on production in Q2. So again, we expect good momentum in the second half of the year here. Just picking out a couple of others as we go down. Four Mile, very similar to Mamboula in that it lags a quarter. So whilst the normal levels of sales volumes has resumed here, it is lagging one quarter. So we expect much higher levels of revenue to come through in the second half. And bear in mind the 1.4 million comparative number here on H1 last year. There was no revenue in the second half of last year. So we expect good momentum here too. It's worth noting again, further down the chart, that EVBC provides us with some gold exposure. And the delta here reflects the outperformance of the gold price over the first half of the year. And beyond that, in fact, gold is trading just under 3,500 an ounce. And we have some good torque to that through the EVBC gold royalty. And last but by no means least is Kestrel. And whilst this now represents a short-term asset for the group, it's still worth remembering that we expect total volumes here between 2.2 and 2.3 million tons this year. This is about a 10% increase on what we received last year. So whilst not core to the long-term equity story of Acora, the next two years from Kestrel is still very key to our deleveraging path. And I'll touch on this later on. Turning to our adjusted earnings, a couple of things just to highlight here. Our overheads in the period, we report these in USD, but the vast majority of our cost base is in pound sterling. So slight increase here year on year, given the weakening of the US dollar in the period. The 6.4 million here includes about 800,000 of share-based payments. So that is not a cash cost. Our finance costs of 4.9 reflect higher borrowings in the period, higher average borrowings in the period following the Membula acquisition. But they've also benefited from somewhat lower finance costs given the rate cuts that the Fed has imposed this year to date and with expectations that further cuts could be coming in the second half of the year. The potential, especially with Dugbee now as well, to see a reduction in our run rate on finance costs. And one thing which is also worth noting is the tax cost of 1.8. This tax cost is based on the portfolio contribution accrued in the first half of the year. And as we noted, Kestrel was not a significant component of that. And Kestrel, as I've said before, attaches a very high effective tax rate. So the effective tax rate implied here is a real indication of what is to come in terms of free cash flow conversion in life after Kestrel in a couple of years' time. Turning to the balance sheet, just to highlight a couple of things, the increase in royalty assets obviously includes the Membula acquisition, offset somewhat by the fair value revision to Kestrel in a lower coking coal price environment. Worth noting, as I often do, the 249.7 million royalty intangible assets This represents about 45% of our total royalty assets. Now, these assets under IFRS are carried at the lower of their fair value or amortized cost. And as such, any increase or inherent increase value in this portfolio, whether that is through reserve and resource upside revisions to commodity prices or indeed just the unwinding of the discount rate as these get closer to production, is never reflected on the balance sheet. And if we go further down the page, the 429.9 million net assets at 13th of June approximates to about 126 P per share. So based on the hidden value, if you like, of the intangible assets, there should be some upside to that number on a pro forma basis. My final slide is our net debt reconciliation and our liquidity. This chart is a little bit out of date given the recent announcement of the Dugbee disposal. But for this year, it includes the MIMBULA acquisition. And it's worth remembering as well, at the same time we did this, we took the opportunity to accelerate all the remaining deferred considerations associated with our Narrabri disposal, which along with the payments we had received in January 2025 associated with the contractual obligations brought in $11.5 million. adding the 16.5 million from Dugbee to this number, and we've effectively refinanced about 56% of the cost of Mambula through extracting value from our portfolio. Leverage remained comfortable at the half-year at 2.5x. Again, this pre-Dugbee. Post-Dugbee, that pro forma number would have been about 2.17. And that's comfortably within the 3.5 times permitted under our borrowing facility. The Dugbee sale, as Mark mentioned, should accelerate deleveraging in the second half of the year, along with the second half weighting of our portfolio cash contributions. And if we look across to the box on the bottom right-hand side of the page, we'll see, based on consensus pricing, where the debt numbers could end up at the end of this year and next year. So we remain well capitalized. On top of those numbers, we have $108 million facility. We've no obligations on this until maturity in early 2028. and plenty of capital left to recycle into future acquisitions. And I'll pass it back to Mark.