TORONTO, Nov. 4, 2021 /CNW/ - Labrador Iron Ore Royalty
Corporation ("LIORC") (TSX: LIF) announced today its operation and
cash flow results for the quarter ended September 30, 2021.
Financial Performance
In the third quarter of 2021, LIORC's financial results
benefited from higher iron ore prices and pellet premiums,
partially offset by lower volumes of concentrate for sale ("CFS")
sales. Royalty revenue for the third quarter of 2021 amounted to
$74.2 million compared to
$52.4 million for the third quarter
of 2020. Equity earnings from Iron Ore Company of Canada ("IOC") were $60.5 million in the third quarter of 2021
compared to $34.9 million in the
third quarter of 2020. Net income per share for the third quarter
of 2021 was $1.64 per share, which
was an 82% increase over the same period in 2020. The adjusted cash
flow per share for the third quarter of 2021 was $1.99 per share, which was 333% higher than in
the same period in 2020, as a result of higher royalty revenues and
the decision by IOC to pay a dividend. In the third quarter of
2021, LIORC received a dividend in the amount of $85.8 million from IOC.
In the third quarter of 2021, iron ore prices dropped from the
record levels experienced in the second quarter of 2021, as
China, which accounts for a
majority of the world's steel production and over 70% of all
seaborne iron ore demand, placed restrictions on its steel
production in an effort to curb year-over-year production growth.
According to the World Steel Association, global crude steel
production in China in the third
quarter of 2021 was 14% lower than the same quarter of 2020 and 16%
lower than the second quarter of 2021. In addition, in the quarter
ending September 30, iron ore
production by the three largest seaborne iron ore producers, Vale,
Rio Tinto and BHP, while consistent with the same quarter of 2020,
was 9% higher than the prior quarter.
IOC sells CFS based on the Platts index for 65% Fe, CFR China
("65% Fe index"). All references to tonnes and per tonne prices in
this report refer to wet metric tonnes, other than references to
Platts quoted pricing, which refer to dry metric tonnes.
Historically, IOC's wet ore contains approximately 3% less ore per
equivalent volume than dry ore. In the third quarter of 2021, the
65% Fe index averaged US$190 per
tonne, a 47% increase over the average of US$129 per tonne in the third quarter of 2020,
and an 18% decrease over the average of US$233 in the second quarter of 2021. The monthly
Atlantic Blast Furnace 65% Fe pellet premium index as quoted by
Platts (the "pellet premium") averaged US$77 per tonne in the third quarter of 2021, up
substantially from an average of US$29 in the same quarter of 2020, which had been
negatively impacted by a reduction in demand from European steel
producers due to COVID-19.
Based on sales as reported for the LIORC Royalty, the overall
average price realized by IOC for CFS and pellets, FOB Sept-Îles,
was approximately C$247 per tonne in
the third quarter of 2021, compared to approximately C$162 per tonne in the third quarter of 2020 and
C$275 per tonne in the second quarter
of 2021.
Iron Ore Company of Canada Operations
Operations
IOC continues to follow COVID-19 procedures and protocols to
prevent COVID-19 outbreaks within IOC's operations, which has
allowed IOC to effectively operate throughout 2021. Total
concentrate production in the third quarter of 2021 was 3.9 million
tonnes. This was 8% lower than the third quarter of 2020 and 18%
lower than the second quarter of 2021 due mainly to labour and
equipment availability issues during the quarter which impacted
feed availability. As well, the annual maintenance shutdown,
which was completed in September, took longer than expected.
The IOC saleable production (CFS plus pellets) of 3.7 million
tonnes in the third quarter of 2021 was 8% lower than the same
period in 2020 and 20% lower than the second quarter of 2021,
mainly as a result of lower concentrate production referred to
above.
In the third quarter of 2021, CFS production of 1.4 million
tonnes was 20% lower than the same quarter last year, mainly
due to lower concentrate production, as well as the decision by IOC
to produce less pellets and more CFS in 2020. CFS production in the
third quarter of 2021 was 28% lower than the second quarter of
2021, due to lower concentrate production. Pellet production in the
third quarter of 2021 of 2.3 million tonnes was 3% higher than
the corresponding quarter in 2020 due to IOC's decision to reduce
the focus on the production of pellets in 2020, and 15% lower than
the second quarter of 2021, due to issues related to lack of feed
from the concentrator.
Sales as Reported for the LIORC Royalty
Total iron ore sales tonnage by IOC (CFS plus pellets) of 4.2
million tonnes in the third quarter of 2021 was 10% lower than the
total sales tonnage for the same period in 2020 mainly as a result
of lower product availability. Total iron ore sales tonnage
in the third quarter of 2021 was 2% higher than the second quarter
of 2021, as sales tonnage in the second quarter of 2021 was
negatively impacted by the lack of availability of reclaimers
during the quarter. Pellet sales in the third quarter of 2021 of
2.4 million tonnes was 1% higher than the total sales tonnage for
the same quarter last year and 5% higher than the second quarter of
2021. CFS sales tonnage was 22% lower than the same quarter last
year and 2% lower than the second quarter of 2021.
Outlook
Rio Tinto has lowered the 2021 guidance for IOC's saleable
production (CFS plus pellets) from 17.9 to 20.4 million tonnes to
16.2 to 17.9 million tonnes. This compares to 17.7 million tonnes
of saleable production in 2020 and 12.3 million tonnes in the first
nine months of 2021.
Despite lower than expected sales in the first nine months, IOC
is in an excellent financial position, having benefitted in 2021
from a very strong iron ore pricing environment. In the first
nine months of 2021, IOC generated net after tax cash from
operating activities of US$1,259
million, had capital expenditures of US$170 million, and paid shareholder dividends of
US$950 million. As at September 30, 2021, IOC had no debt, total
current assets of US$665 million, and
total current liabilities of US$517
million.
IOC experienced decreasing iron ore prices throughout the third
quarter. The monthly average price of the 65% Fe index
dropped from an average of US$244 in
July to an average of US$143 in
September. Since the end of the third quarter (October 1, 2021 to October
26, 2021), the average price of the 65% Fe index has been
US$146 per tonne. To put this in
perspective, this is 28% lower than the average of US$204 for the first nine months of 2021, but 20%
higher than the annual average of US$122 for 2020. The pellet premium has also
declined. In October, 2021, the pellet premium of US$56 was 10% lower than the average of first
nine months of 2021, but 92% higher than the annual average of
2020.
Future government action regarding steel production output in
China and its resulting impact on
iron ore prices remains somewhat uncertain. That said, in the
current pricing environment LIORC remains well positioned to profit
from its royalty and commission interests in IOC and to receive
future IOC dividends, albeit at lower levels than in the first
three quarters of 2021.
LIORC has no debt and at September 30,
2021 had positive net working capital (current assets less
current liabilities) of $21.6
million. After the end of the third quarter LIORC paid
a dividend on October 26, 2021 of
$2.10 per share or $134.4 million. The net royalty from IOC was
received by LIORC on the same date, maintaining the Corporation's
strong cash balance.
Respectfully submitted on behalf of the Directors of the
Corporation,
John F. Tuer
President and Chief Executive Officer
November 4, 2021
Management's Discussion and Analysis
The following discussion and analysis should be read in
conjunction with the Management's Discussion and Analysis section
of Labrador Iron Ore Royalty Corporation's ("LIORC" or the
"Corporation") 2020 Annual Report, and the financial statements and
notes contained therein and the September
30, 2021 interim condensed consolidated financial
statements.
Overview of the Business
The Corporation's revenues are entirely dependent on the
operations of IOC as its principal assets relate to the operations
of IOC and its principal source of revenue is the 7% royalty it
receives on all sales of iron ore products by IOC. In addition to
the volume of iron ore sold, the Corporation's royalty revenue is
affected by the price of iron ore and the Canadian – U.S. dollar
exchange rate. The first quarter sales of IOC are traditionally
adversely affected by the general winter operating conditions and
are usually 15% – 20% of the annual volume, with the balance spread
fairly evenly throughout the other three quarters. Because of the
size of individual shipments, some quarters may be affected by the
timing of the loading of ships that can be delayed from one quarter
to the next.
Financial Highlights
Financial and
Operating Highlights
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2021
|
2020
|
|
2021
|
2020
|
|
(unaudited)
|
|
($ in
millions except per share information)
|
|
|
|
|
|
|
Revenue
|
74.7
|
52.9
|
|
219.7
|
147.9
|
Equity earnings from
IOC
|
60.5
|
34.9
|
|
183.7
|
88.3
|
Net
income
|
104.8
|
57.7
|
|
301.6
|
153.2
|
Net income per
share
|
$ 1.64
|
$ 0.90
|
|
$ 4.71
|
$ 2.39
|
Dividend(s) from
IOC
|
85.8
|
-
|
|
179.3
|
-
|
Cash flow from
operations
|
137.3
|
11.1
|
|
295.9
|
59.4
|
Cash flow from
operations per share
|
$ 2.15
|
$ 0.17
|
|
$ 4.62
|
$ 0.93
|
Adjusted cash
flow1
|
127.3
|
29.2
|
|
301.0
|
81.6
|
Adjusted cash flow
per share
|
$ 1.99
|
$ 0.46
|
|
$ 4.70
|
$ 1.28
|
Dividends declared
per share
|
$ 2.10
|
$ 0.45
|
|
$ 4.85
|
$ 1.25
|
1 This
is a non-IFRS financial measure and does not have a standard
meaning under IFRS.
|
Please refer to
Standardized Cash Flow and Adjusted Cash Flow section in the
MD&A.
|
The higher revenue, net income and equity earnings
achieved in the third quarter of 2021 as compared to 2020 were
mainly due to higher iron ore prices, partly offset by lower sales
of CFS. The third quarter of 2021 sales tonnage (pellets and CFS)
were lower by 10% mainly due to lower CFS production. CFS
sales tonnage was 22% lower and pellet sales tonnage was consistent
with the same quarter last year. However, the lower sales
tonnage was more than offset by an increase in the realized sales
price of pellets and CFS, resulting in royalty income of
$74.2 million for the quarter as
compared to $52.4 million for the
same period in 2020. Third quarter 2021 cash flow from operations
was $137.3 million or $2.15 per share compared to $11.1 million or $0.17 per share for the same period in 2020.
LIORC received an IOC dividend in the third quarter of 2021 in the
amount of $85.8 million or
$1.34 per share. Equity earnings from
IOC amounted to $60.5 million or
$0.95 per share in the third quarter
of 2021 compared to $34.9 million or
$0.55 per share for the same period
in 2020.
Operating Highlights
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
IOC
Operations
|
2021
|
2020
|
|
2021
|
2020
|
|
(in millions
of tonnes)
|
Sales1
|
|
|
|
|
|
Pellets
|
2.37
|
2.35
|
|
7.08
|
7.61
|
Concentrate for sale
("CFS")2
|
1.80
|
2.31
|
|
5.32
|
6.35
|
Total3
|
4.18
|
4.65
|
|
12.40
|
13.96
|
|
|
|
|
|
|
Production
|
|
|
|
|
|
Concentrate
produced
|
3.92
|
4.25
|
|
13.12
|
13.78
|
|
|
|
|
|
|
Saleable
production
|
|
|
|
|
|
Pellets
|
2.27
|
2.22
|
|
7.45
|
7.12
|
CFS
|
1.41
|
1.77
|
|
4.86
|
5.93
|
Total
|
3.68
|
3.99
|
|
12.31
|
13.05
|
|
|
|
|
|
|
Average index prices
per tonne (US$)
|
|
|
|
|
|
65% Fe
index4
|
$ 190
|
$ 129
|
|
$ 205
|
$ 114
|
62% Fe
index5
|
$ 163
|
$ 118
|
|
$ 177
|
$ 100
|
Pellet
premium6
|
$ 77
|
$ 29
|
|
$ 62
|
$ 29
|
(1) For
calculating the royalty to LIORC.
|
|
|
(2)Excludes third party ore
sales.
|
|
|
(3)
Totals may not add up due to rounding.
|
|
(4)The
Platts index for 65% Fe, CFR China.
|
|
|
(5)The
Platts index for 62% Fe, CFR China.
|
|
|
(6)The
Platts Atlantic Blast Furnace 65% Fe pellet premium
index.
|
IOC sells CFS based on the 65% Fe index. In the third
quarter of 2021, the 65% Fe index averaged US$190 per tonne, a 47% increase over the average
of US$129 per tonne in the third
quarter of 2020, and an 18% decrease over the average of
US$233 in the second quarter of
2021. Iron ore prices decreased from the prior quarter, as the
demand for seaborne iron ore from China weakened as a result of government
efforts to curb steel production growth in China. The monthly pellet premium averaged
US$77 per tonne in the third quarter
of 2021, up substantially from an average of US$29 in the same quarter of 2020, which had been
negatively impacted by a reduction in demand from European steel
producers due to COVID-19.
Based on sales as reported for the LIORC Royalty, the overall
average price realized by IOC for CFS and pellets, FOB Sept-Îles,
was approximately C$247 per tonne in
the third quarter of 2021, compared to approximately C$162 per tonne in the third quarter of 2020 and
C$275 per tonne in the second quarter
of 2021. The increase in the average realized price FOB Sept-Îles
in 2021 was a result of higher CFS prices and higher pellet
premiums.
Standardized Cash Flow and Adjusted Cash Flow
For the Corporation, standardized cash flow is the same as cash
flow from operating activities as recorded in the Corporation's
cash flow statements as the Corporation does not incur capital
expenditures or have any restrictions on dividends.
Standardized cash flow per share was $2.15 for the quarter (2020 - $0.17).
The Corporation also reports "Adjusted cash flow" which is
defined as cash flow from operating activities after adjustments
for changes in amounts receivable, accounts payable and income
taxes recoverable and payable. It is not a recognized measure
under International Financial Reporting Standards ("IFRS"). The
Directors believe that adjusted cash flow is a useful analytical
measure as it better reflects cash available for dividends to
shareholders.
The following reconciles standardized cash flow from operating
activities to adjusted cash flow.
|
3 Months
Ended
Sept. 30,
2021
|
3 Months
Ended
Sept. 30,
2020
|
9 Months
Ended
Sept. 30,
2021
|
9 Months
Ended
Sept. 30,
2020
|
|
|
(in thousands
except for per share information)
|
|
|
|
|
Standardized cash
flow from operating activities
|
$137,298
|
$11,084
|
$295,850
|
$59,351
|
|
Changes in amounts
receivable, accounts payable and income taxes payable
|
(9,963)
|
18,070
|
5,163
|
22,268
|
|
Adjusted cash
flow
|
$127,335
|
$29,154
|
$301,013
|
$81,619
|
|
Adjusted cash flow
per share
|
$1.99
|
$0.46
|
$4.70
|
$1.28
|
|
Liquidity and Capital Resources
The Corporation had $110.7 million
in cash as at September 30, 2021
(December 31, 2020 - $106.1 million) with total current assets of
$188.6 million (December 31, 2020 - $164.4
million). The Corporation had working capital of
$21.6 million as at September 30, 2021 (December 31, 2020 - $31.0
million). The Corporation's operating cash flow was
$137.3 million and the dividend paid
during the quarter was $112 million,
resulting in cash balances increasing by $25.3 million during the third quarter of 2021.
In September, the Directors of the Corporation declared the third
quarter dividend of $134.4 million
that was paid on October 26,
2021.
Cash balances consist of deposits in Canadian dollars with
Canadian chartered banks. Amounts receivable primarily consist of
royalty payments from IOC. Royalty payments are received in U.S.
dollars and converted to Canadian dollars on receipt, usually 25
days after the quarter end. The Corporation does not normally
attempt to hedge this short-term foreign currency exposure.
Operating cash flow of the Corporation is sourced entirely from
IOC through the Corporation's 7% royalty, 10
cents commission per tonne and dividends from its 15.10%
equity interest in IOC. The Corporation normally pays cash
dividends from its net income to the maximum extent possible,
subject to the maintenance of appropriate levels of working
capital.
The Corporation has a $30 million
revolving credit facility with a term ending September 18, 2024 with provision for annual
one-year extensions. No amount is currently drawn under this
facility (2020 – nil) leaving $30.0
million available to provide for any capital required by IOC
or requirements of the Corporation.
John F. Tuer
President and Chief Executive Officer
Toronto, Ontario
November 4, 2021
Forward-Looking Statements
This report may contain
"forward-looking" statements that involve risks, uncertainties and
other factors that may cause the actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Words such as "may", "will", "expect",
"believe", "plan", "intend", "should", "would", "anticipate" and
other similar terminology are intended to identify forward-looking
statements. These statements reflect current assumptions and
expectations regarding future events and operating performance as
of the date of this report. Forward-looking statements involve
significant risks and uncertainties, should not be read as
guarantees of future performance or results, and will not
necessarily be accurate indications of whether or not such results
will be achieved. A number of factors could cause actual results to
vary significantly, including iron ore price and volume volatility,
exchange rates, the performance of IOC, market conditions in the
steel industry, mining risks and insurance, relationships with
indigenous groups, natural disasters, severe weather conditions and
public health crises, changes affecting IOC's customers,
competition from other iron ore producers, estimates of reserves
and resources, government regulation and taxation and
cybersecurity. A discussion of these factors is contained in
LIORC's annual information form dated March
4, 2021 under the heading, "Risk Factors". Although the
forward-looking statements contained in this report are based upon
what management of LIORC believes are reasonable assumptions, LIORC
cannot assure investors that actual results will be consistent with
these forward-looking statements. These forward-looking statements
are made as of the date of this report and LIORC assumes no
obligation, except as required by law, to update any
forward-looking statements to reflect new events or circumstances.
This report should be viewed in conjunction with LIORC's other
publicly available filings, copies of which can be obtained
electronically on SEDAR at www.sedar.com.
Notice:
The following unaudited interim condensed
consolidated financial statements of the Corporation have been
prepared by and are the responsibility of the Corporation's
management. The Corporation's independent auditor has not reviewed
these interim financial statements.
LABRADOR IRON ORE
ROYALTY CORPORATION
|
|
|
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
at
|
|
|
September
30,
|
|
December
31,
|
(in thousands of
Canadian dollars)
|
2021
|
|
2020
|
|
|
(Unaudited)
|
Assets
|
|
|
|
Current
Assets
|
|
|
|
|
Cash and short-term
investments
|
$
110,741
|
|
$
106,091
|
|
Amounts
receivable
|
77,852
|
|
58,336
|
Total Current
Assets
|
188,593
|
|
164,427
|
|
|
|
|
|
Non-Current
Assets
|
|
|
|
|
Iron Ore Company of
Canada ("IOC")
|
|
|
|
|
royalty
and commission interests
|
236,975
|
|
241,511
|
|
Investment in
IOC
|
425,429
|
|
417,284
|
Total Non-Current
Assets
|
662,404
|
|
658,795
|
|
|
|
|
|
Total
Assets
|
$
850,997
|
|
$
823,222
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts
payable
|
$
16,170
|
|
$
12,533
|
|
Dividend
payable
|
134,400
|
|
115,200
|
|
Taxes
payable
|
16,407
|
|
5,691
|
Total Current
Liabilities
|
166,977
|
|
133,424
|
|
|
|
|
|
Non-Current
Liabilities
|
|
|
|
|
Deferred income
taxes
|
123,320
|
|
123,430
|
Total
Liabilities
|
290,297
|
|
256,854
|
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
Share
capital
|
317,708
|
|
317,708
|
|
Retained
earnings
|
253,176
|
|
262,000
|
|
Accumulated other
comprehensive loss
|
(10,184)
|
|
(13,340)
|
|
|
560,700
|
|
566,368
|
|
|
|
|
|
Total Liabilities and
Shareholders' Equity
|
$
850,997
|
|
$
823,222
|
Approved by the
Directors,
|
|
|
|
|
|
|
|
John F.
Tuer
|
Patricia M.
Volker
|
Director
|
Director
|
LABRADOR IRON ORE
ROYALTY CORPORATION
|
|
|
|
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
|
September
30,
|
(in thousands of
Canadian dollars except for per share information)
|
2021
|
|
2020
|
|
|
|
Revenue
|
|
|
|
|
IOC
royalties
|
$
74,224
|
|
$
52,354
|
|
IOC
commissions
|
411
|
|
458
|
|
Interest and other
income
|
70
|
|
48
|
|
|
74,705
|
|
52,860
|
Expenses
|
|
|
|
|
Newfoundland royalty
taxes
|
14,845
|
|
10,470
|
|
Amortization of
royalty and commission interests
|
1,479
|
|
1,541
|
|
Administrative
expenses
|
607
|
|
828
|
|
|
16,931
|
|
12,839
|
|
|
|
|
|
Income before
equity earnings and income taxes
|
57,774
|
|
40,021
|
Equity earnings in
IOC
|
60,522
|
|
34,894
|
|
|
|
|
|
Income before
income taxes
|
118,296
|
|
74,915
|
|
|
|
|
|
Provision for
income taxes
|
|
|
|
|
Current
|
17,763
|
|
12,408
|
|
Deferred
|
(4,230)
|
|
4,779
|
|
|
13,533
|
|
17,187
|
|
|
|
|
|
Net income for the
period
|
104,763
|
|
57,728
|
|
|
|
|
|
Other
comprehensive loss
|
|
|
|
|
Share of other
comprehensive income of IOC that will not be
|
|
|
|
|
reclassified
subsequently to profit or loss (net of income
taxes
|
|
|
|
|
of 2020 -
$439)
|
-
|
|
(2,487)
|
|
|
|
|
|
Comprehensive
income for the period
|
$
104,763
|
|
$
55,241
|
|
|
|
|
|
Net income per
share
|
$
1.64
|
|
$
0.90
|
LABRADOR IRON ORE
ROYALTY CORPORATION
|
|
|
|
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Nine
Months Ended
|
|
|
September
30,
|
(in thousands of
Canadian dollars except for per share information)
|
2021
|
|
2020
|
|
|
(Unaudited)
|
Revenue
|
|
|
|
|
IOC
royalties
|
$
218,265
|
|
$
146,182
|
|
IOC
commissions
|
1,219
|
|
1,374
|
|
Interest and other
income
|
170
|
|
315
|
|
|
219,654
|
|
147,871
|
Expenses
|
|
|
|
|
Newfoundland royalty
taxes
|
43,653
|
|
29,236
|
|
Amortization of
royalty and commission interests
|
4,536
|
|
4,808
|
|
Administrative
expenses
|
2,149
|
|
2,201
|
|
|
50,338
|
|
36,245
|
|
|
|
|
|
Income before
equity earnings and income taxes
|
169,316
|
|
111,626
|
Equity earnings in
IOC
|
183,714
|
|
88,254
|
|
|
|
|
|
Income before
income taxes
|
353,030
|
|
199,880
|
|
|
|
|
|
Provision for
income taxes
|
|
|
|
|
Current
|
52,121
|
|
34,815
|
|
Deferred
|
(667)
|
|
11,829
|
|
|
51,454
|
|
46,644
|
|
|
|
|
|
Net income for the
period
|
301,576
|
|
153,236
|
|
|
|
|
|
Other
comprehensive income (loss)
|
|
|
|
|
Share of other
comprehensive income (loss) of IOC that will not
be
|
|
|
|
|
reclassified
subsequently to profit or loss (net of income taxes
|
|
|
|
|
of 2021 - $557; 2020
- $519)
|
3,156
|
|
(2,939)
|
|
|
|
|
|
Comprehensive
income for the period
|
$
304,732
|
|
$
150,297
|
|
|
|
|
|
Net income per
share
|
$
4.71
|
|
$
2.39
|
LABRADOR IRON ORE
ROYALTY CORPORATION
|
|
|
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Nine
Months Ended
|
|
|
|
|
September
30,
|
(in thousands of
Canadian dollars)
|
2021
|
|
2020
|
|
|
|
|
(Unaudited)
|
Net inflow
(outflow) of cash related
|
|
|
|
|
to the following
activities
|
|
|
|
|
|
|
|
|
|
|
Operating
|
|
|
|
|
|
Net income for the
year
|
$
301,576
|
|
$
153,236
|
|
Items not affecting
cash:
|
|
|
|
|
|
Equity earnings in
IOC
|
(183,714)
|
|
(88,254)
|
|
|
Current income
taxes
|
52,121
|
|
34,815
|
|
|
Deferred income
taxes
|
(667)
|
|
11,829
|
|
|
Amortization of
royalty and commission interests
|
4,536
|
|
4,808
|
|
Common share dividend
from IOC
|
179,282
|
|
-
|
|
Change in amounts
receivable
|
(19,516)
|
|
(18,365)
|
|
Change in accounts
payable
|
3,637
|
|
3,471
|
|
Income taxes
paid
|
(41,405)
|
|
(42,189)
|
|
Cash flow from
operating activities
|
295,850
|
|
59,351
|
|
|
|
|
|
|
|
Financing
|
|
|
|
|
|
Dividend paid to
shareholders
|
(291,200)
|
|
(118,400)
|
|
Cash flow used in
financing activities
|
(291,200)
|
|
(118,400)
|
|
|
|
|
|
|
|
Increase
(decrease) in cash, during the period
|
4,650
|
|
(59,049)
|
|
|
|
|
|
|
|
Cash, beginning of
period
|
106,091
|
|
77,859
|
|
|
|
|
|
|
|
Cash, end of
period
|
$
110,741
|
|
$
18,810
|
LABRADOR IRON ORE
ROYALTY CORPORATION
|
|
|
|
|
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
other
|
|
|
Share
|
Retained
|
comprehensive
|
|
(in thousands of
Canadian dollars)
|
capital
|
earnings
|
loss
|
Total
|
|
(Unaudited)
|
|
|
|
|
|
Balance as at
December 31, 2019
|
$
317,708
|
$
230,005
|
$
(10,376)
|
$
537,337
|
Net income for the
period
|
-
|
153,236
|
-
|
153,236
|
Dividends declared to
shareholders
|
-
|
(80,000)
|
-
|
(80,000)
|
Share of other
comprehensive loss from investment in IOC (net of taxes)
|
-
|
-
|
(2,939)
|
(2,939)
|
Balance as at
September 30, 2020
|
$
317,708
|
$
303,241
|
$
(13,315)
|
$
607,634
|
|
|
|
|
|
Balance as at
December 31, 2020
|
$
317,708
|
$
262,000
|
$
(13,340)
|
$
566,368
|
Net income for the
period
|
-
|
301,576
|
-
|
301,576
|
Dividends declared to
shareholders
|
-
|
(310,400)
|
-
|
(310,400)
|
Share of other
comprehensive income from investment in IOC (net of
taxes)
|
-
|
-
|
3,156
|
3,156
|
Balance as at
September 30, 2021
|
$
317,708
|
$
253,176
|
$
(10,184)
|
$
560,700
|
The complete consolidated financial statements for the third
quarter ended September 30, 2021,
including the notes thereto, are posted on sedar.com and
labradorironore.com
SOURCE Labrador Iron Ore Royalty Corporation