Star Royalties Ltd (TSX-V:STRR) posted third-quarter results with revenue jumping 4% year-over-year as the company reported record quarterly revenue from the Keysbrook royalty, an open pit mineral sands mine located south of Perth in Australia.
For the period ended September 30, 2022, the Toronto-based precious metals and carbon credit royalty and streaming company reported revenue of $234,854, compared to $225,458 in the third quarter of 2021.
Star Royalties chalked up its growth to its first quarterly positive cash flow from operations and consistently strong revenue from its Keysbrook royalty which has been in operation since late 2015.
Significantly, the company had $58,180 in cash flow from operating activities for the quarter, compared to an outgoing flow of $92,758 during the comparable period a year earlier.
In a statement accompanying the numbers, Star Royalties CEO Alex Pernin said: “The 3Q of 2022 represented meaningful progress across the company. Keysbrook has delivered once more with its record quarterly revenue. Our Green Star joint venture has continued to build its project pipeline and added industry-leading carbon experts to strengthen its position as a quality leader in the carbon credit royalty space.”
“Sabre Gold and Gold Mountain have identified clear plans to advance project financing and improve operational performance, respectively. Despite these challenging market conditions, we are encouraged by the progress across our assets, and the continued investor interest we are receiving with Green Star.”
Portfolio update
Star Royalties also provided an update on its majority-owned Green Star joint venture (JV) in which it holds a 61.9% interest. The company recently appointed Rina Cerrato as Chief Commercial Officer and Tanushree Bagh Mukherjee as Chief Development Officer.
Green Star, which aims to become a leader in the carbon credit royalty space, has identified both new prospective capital providers and investment opportunities. It is “actively evaluating capital opportunities through a combination of private and public markets, subject to market conditions,” said Star Royalties.
Green Star’s flagship regenerative agriculture CarbonNOW program, in partnership with Anew Climate LLC and Locus Agricultural Solutions, aims to create premium, verified carbon offset credits that will reward the adoption of regenerative agriculture practices by North American farmers. Green Star reported that the status of current farmer enrollment is now well beyond the program’s original scope of 320,000 acres.
As such, Green Star’s funding of the program continues to advance, with $4.6 million invested at the end of October. The remainder of Green Star’s $20.6 million contribution is expected to occur through 2023 and beyond. Green Star continues to expect to generate cash flow equivalent to over 200,000 attributable carbon offset credits in 2024, increasing to over 400,000 attributable carbon offset credits per year starting in 2025.
Investors can find an update on Gold Mountain Mining Corp’s Elk Gold Mine and the Copperstone Gold Mine here.
Star Royalties has created the world’s first carbon credit royalties in forestry and regenerative agriculture through its majority-owned Green Star Royalties joint venture.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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