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viewVox Royalty

Vox Royalty has the cash and management experience to rapidly grow its portfolio of low-risk mining assets

Snapshot

The company has 35 operating partners and says three quarters of its assets are located in low-risk Australia

Vox Royalty -

Quick facts: Vox Royalty

Price: 2.35 CAD

TSX-V:VOX
Market: TSX-V
Market Cap: $76.53 m
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  • Low geo-political risk portfolio
  • Led by team with over 30 years combined of royalty and streaming experience
  • Significant portfolio growth expected over next 12 months

What Vox Royalty Corp does:

Vox Royalty Corp (CVE:VOX) is a fast-growing royalty firm with a portfolio already spanning several continents.

Toronto-based Vox holds a portfolio of 42 royalties and streaming assets and one royalty option in Australia, Canada, Peru, Brazil, Mexico, the United States, Madagascar and Nigeria. It has 35 operating partners. Notably, it says three quarters of its assets are located in low-risk Australia.

Its assets are mainly precious metals, at over 50% of its net asset value (NAV) but the portfolio also contains base and battery metals.

The company, which has a market cap of C$96 million, was established in 2014 and says it has since built unique intellectual property (IP), a technically focused transactional team and a global sourcing network.

Since the beginning of last year, the group has announced over 15 separate transactions to acquire over 35 royalties.

How is it doing:

In its results statement, Vox Royalty described its second quarter to end June - its first quarter as a publicly-traded company - as  "very successful". The three month period saw the firm grow its two production stage assets to four and it said it expects to end 2021 with over seven production-stage assets.

"The portfolio has already realized significant value accretion from organic milestones being achieved by our operating partners and from recent acquisitions," chief executive Kyle Floyd told investors

"We are ahead of schedule both in terms of number of royalties added and expected 2021 producing royalty assets. Vox continues to set the pace in the industry for growth and will continue making excellent acquisitions in volume."

The firm ended the quarter with just over US$6.3 million in cash.

A notable acquisition in the period was a royalty called Dry Creek on select tenements within RNC Minerals’ (RNC) (now Karora Resources) Higginsville gold operations in Australia for A$650,000 in cash and shares.

The deal gives the group exposure to high-grade exploration results from 2019/2020 at Hidden Secret and Mousehollow, including visible gold intersections at Hidden Secret, along with a strong venture exchange listed partner. On August 11, Vox noted that mining had started at the Hidden Secret deposit by Karora Resources.

Vox also acquired a 1.75% gross revenue royalty on the advanced Ashburton gold project in Australia as part of a portfolio of seven royalties from an ASX- listed explorer. Kalamazoo Resources bought the asset in June and has stated it aims "to make new discoveries" and substantially increase the 1.65 million ounce (Moz) oxide and sulphide gold resource.

The period also saw the group buy a proprietary royalty database from Mineral Royalties Online Pty Ltd, which includes over 7,000 global royalties, providing Vox with a first-mover advantage to execute non-brokered royalty deals.

What the broker says:

Recently, Paradigm analyst David Davidson began covering Vox Royalty with a 'Buy' rating, the Canadian newspaper The Globe and Mail reported, saying he is the lone analyst on the Street covering the stock, and has a share price target of C$3.75 (current price C$3.30).

"Along with management's expertise in the royalty industry, VOX owns an exclusive database of more than 7,000 prospective transactions that provide a competitive advantage to help yield wider opportunities within a range of industries," the analyst was quoted as saying.

"In several cases to date, VOX has been the sole bidder on a contract owing to its exclusive knowledge of the existing royalty."

Since its IPO, Vox has continued to grow with the completion of several new deals, said the analyst, who noted that royalty companies which exhibit these positive attributes tend to trade at "premiums to peers".

Inflection points:

  • More royalty acquisitions
  • News of activity from operating partners
  • Precious metals prices

What the boss says:

Following Vox Royalty's second quarter results, chief executive Kyle Floyd told Proactive that he expects the firm, operationally, to be 'ahead' of its publicly stated target of closing one royalty deal a month for the foreseeable future.

"We're well capitalized. We raised almost C$14 million as part of the IPO - a significant amount of cash on the balance sheet for us to use as dry powder for acquisitions going forward. So we're really well positioned to stay ahead of target," he said.

What the analyst says

Click here to read Ryan long's initiation report

Click here to read the latest report

 

 

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