October delivered some mild respite for long-suffering investors in the mining royalty and streaming sector, with the average share price up 1.9%.
The gains were not shared equally within the sector with much of the space, 63%, experiencing negative share price movements, so it was a case of smaller negative moments in share prices being eclipsed by fewer larger gains.
All tiers of the sector were up, the Mid-Tiers were the best performing subset of the sector, up 2.5%, closely followed by the Juniors who were up an average of 2.1%. The Majors were up 1.9%, and the Large-Tiers were up marginally, 0.5%.
October saw gains across major markets with the Dow up 13.95%, the S&P up 8% and Nasdaq up 3.9%. Investors appear to be hoping that policy tightening is coming to an end, though its likely that rates are going to go up before they go down.
Majors
Franco-Nevada Corporation (TSX:FNV) was the best performing Major, after being the worst performer last month, up 3.4% (↓3.4% 3-months) despite no news flow. Franco is expected to publish its third quarter 2022 results on November 7th.
Wheaton Precious Metals Corp (LSE:WPM, TSX:WPM, NYSE:WPM) was the worst performing Major after being the best performer for the two proceeding months, up 1.0% (↓4.7% 3-months) despite no news flow. Wheaton will release its 2022 third quarter results on November 3.
Large-Tiers
Osisko Gold Royalties (TSX:OR) was the best performing Large-Tier for the second month in a row, up 5.5% (↑2.6% 3-months). During the month Osisko reported its Q3 2022 results, which saw the Company produce 23,850 attributable gold equivalent ounces (GEOs), the strongest quarter since its inception in 2014. Revenues from royalties and streams totalled C$53.7 million and preliminary cost of sales was just C$4.4 million, giving the Company a record quarterly cash margin of 92%.
Osisko also announced the appointment of Rob Krcmarov to its Board of Directors. Mr Krcmarov is a renowned international mining executive with over 32 years of experience in the natural resources sector and has recently retired as Executive Vice President of Exploration and Growth for Barrick Gold Corporation.
Sandstorm Gold Ltd (TSX:SAND) was the worst performing Large-Tier for the second month in a row, down 4.3% (↓16.7% 3-months), following the publication of its Q3 2022 results. During the quarter the Company sold approximately 22,600 GEOs and realised preliminary revenue of US$38.9 million. Despite this month’s negative share price movement both the revenue and sold GEOs figures represent a quarterly record for the Company. Preliminary cost of sales was US$7.3 million resulting in cash operating margins of 82%.
Mid-Tiers
Altius Minerals Corporation (TSX:ALS) was the best performing Mid-Tier for a second month in a row up an impressive 10.1% (↑16.6% 3-months). Since the start of the year, Altius has been the second-best performing mining royalty company up 20.2%, which compares to the sector average - down 17.5%.
Altius published its expected Q3 2022 preliminary revenue of C$26.4 million, which means on a nine-month basis, attributable royalty revenue totalled C$80.5 million in 2022, up 33% when compared to C$60.5 million during the same period in 2021. Full financial results for the quarter will be published on November 9.
The Company also provided an update on its coal litigation, where Altius seeking $190 million in compensation for the constructive taking or de facto expropriation by regulation of its Genesee mine royalty. A decision issued by the Supreme Court of Canada in October, in an unrelated case, is believed by Altius, to hold materially relevant and positive implications for Altius’ ongoing lawsuit against the governments of Alberta and Canada.
Maverix Metals Inc (TSX:MMX) was the worst performing Mid-Tier this month, down 4.8% (↓25.4% 3-months), despite no news flow. In September, Maverix completed the acquisition of a portfolio of 22 royalties from Barrick Gold Corporation for a total upfront cash consideration of US$50 million and contingent consideration of up to US$10 million. These royalties are over development, advanced exploration and exploration stage projects located predominantly in Canada, the United States, and Australia.
Juniors
Empress Royalty Corp (TSX-V:EMPR, OTCQB:EMPYF). was the best performing Junior and the best overall performing mining royalty and streaming company in October, up an astounding 56.5% (↑56.5% 3-months). Empresses’ shares were buoyed by the closing of US$2 million placing that saw strategic investor and mining Maven, Rick Rule take a stake in the Company.
Empress plans to use the funds to aggressively evaluate new potential opportunities to expand its diversified portfolio of revenue generating gold and silver investments. Empress is now up 18% on the ten months to date this year, making it the third best performing mining royalty and streaming company of 2022 to date.
Sailfish Royalty Corp. was the worst performing Junior this month, down 26.1% (↓44.3% 3-months), despite no news flow. In September the Company announced that Cesar Gonzalez, had stepped down from his role as Chief Executive Officer and Director of the Company to focus on his role as Executive Chairman of Bonterra Resources Inc. (TSX-V:BTR, OTCQX:BONXF)
Mr Gonzalez is replaced by Paolo Lostritto, who previously served as Vice President of Corporate Development for Sailfish. Mr Lostritto has an extensive background in mining capital markets and working with companies across the globe since 1997.