Deterra Royalties (DRR) H1 2025 earnings summary

Executive summary

• Net profit after tax for 1H25 was $63.9 million, with a fully franked interim dividend of 9.0 cents per share declared, totaling $47.6 million.

• Record volumes from key producing assets and new gold offtake contracts drove strong revenues, offsetting lower iron ore prices.

• Integration of the Trident portfolio was completed, exceeding expectations in financial contribution and delivering operating cost synergies at the top of the anticipated range.

• Strong balance sheet maintained, with $500 million in credit facilities and $186 million undrawn.

• Acquisition of Trident Royalties PLC diversified the portfolio into base, precious, bulk, and battery metals.

Financial highlights

• Underlying EBITDA was $106 million (94% margin), down 7% year-over-year, mainly due to lower iron ore prices, partially offset by higher MAC volumes and new gold offtake revenue.

• MAC royalty revenue declined 12% year-over-year due to a 22% drop in realized iron ore prices, offset by increased sales volumes.

• Gold offtakes generated $7.2 million from 136.9k ounces delivered at a US$34.60/oz margin, with record gold prices supporting strong margins.

• Net debt stood at $308 million at 31 December 2024, within the 0-15% long-term target leverage range.

• Basic EPS was $0.1209 for 1H25, down from $0.1489 in 1H24.

Outlook and guidance

• Portfolio contains several short-term catalysts and long-term optionality, including potential volume growth at MAC and upcoming milestones at Thacker Pass and La Preciosa.

• Thacker Pass lithium project expects full notice to proceed in early 2025, with production targeted for 2027.

• La Preciosa expected to begin processing underground material in 2H 2025.

• Focus remains on disciplined, value-accretive investment in high-quality, long-life assets, particularly in established mining jurisdictions and energy transition materials.

• No further one-off Trident acquisition costs expected in future periods.