Empress Royalty (TSXV:EMPR) - The Pure-Play Precious Metals Royalty Growth Opportunity

Company Interviews

Interview with David Rhodes, Executive Chairman, and Alexandra Woodyer Sherron, President & CEO of Empress Royalty Corp.

Our previous interview: https://www.cruxinvestor.com/posts/empress-royalty-tsxvempr-expands-portfolio-with-revenue-generating-mining-assets-3300

Recording date: 5th June 2024

Empress Royalty is an emerging royalty and streaming company offering investors an attractive way to gain exposure to gold and silver. The company has identified a unique niche in the market, providing $5-10 million in financing to near-production or producing mines to fund expansions, development, and equipment purchases. This strategy allows Empress to generate revenue quickly by partnering with proven operators and assets.

A key differentiator for Empress Royalty is the strength and track record of its management team. Endeavour Financial, a leading mining financial advisory firm, reassembled a team of veterans at Empress, leveraging their expertise to source, structure and execute royalty and streaming transactions. This experience allows Empress to conduct rigorous due diligence, navigate complex jurisdictions, and create win-win financing solutions for mining companies.

Importantly, Empress Royalty is the only sizable royalty and streaming company solely focused on gold and silver. While its peers have diversified into other metals like cobalt and copper, Empress has remained steadfast in its precious metals focus, providing a pure-play investment vehicle for those seeking gold and silver exposure. Management believes the macro backdrop of rising inflation, geopolitical tensions, and economic uncertainty will continue to drive demand for gold and silver as safe-haven assets and stores of value.

Empress has moved quickly to build a portfolio of four cash-flowing royalty and streaming assets across Peru, Mozambique, South Africa, and Mexico. These investments generated approximately $4 million in revenue in 2023, with annual revenue expected to roughly double to $7-8 million in 2024. The existing portfolio is projected to generate $60 million in revenue over the next five years before accounting for any additional acquisitions.

Empress is not standing still and is actively working to scale and diversify its asset base. The company is currently conducting due diligence on several new opportunities with term sheets outstanding on three potential transactions. It is targeting 3-4 new investments in the $5-10 million range this year, which could meaningfully increase its revenue and cash flow profile. While Empress is keen to deploy capital, it remains disciplined in its approach, having turned down six deals in the past 18 months after extensive analysis determined they did not meet its investment criteria.

With a market cap of over $30 million, Empress Royalty appears to be flying under the radar of most investors despite its attractive business model, experienced management team, and significant growth potential. As the company continues to scale its portfolio and cash flow per share, it would not be surprising to see Empress Royalty garner greater attention from investors seeking precious metals exposure. Given the company's pure-play focus on gold and silver, investors can use Empress to gain royalty and streaming exposure to these metals without taking on the operational, financial, and geopolitical risks of mining companies. As the precious metals bull market gains momentum, Empress Royalty offers a compelling way to participate.

View Empress Royalty's company profile: https://www.cruxinvestor.com/companies/empress-royalty

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