Duke Royalty: Trading Update
Trading Update
Duke Royalty, a provider of alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and abroad, is pleased to provide the following trading and operational update for its first financial quarter ended 30 June 2021 (“Q1 FY22”), and to provide guidance on trading for the second quarter of the Company’s financial year ended 30 September 2021 (“Q2 FY22”).
Highlights:
- Q1 FY22 cash revenue, being cash distributions from Duke’s royalty partners and cash gains from sales of equity assets, totalled £2.9 million for the quarter which was marginally above management’s expectations
- On a normalised basis, excluding the effects of redemption premiums and/or equity sales, £2.9 million represented a record cash revenue quarter for the Company, surpassing the £2.8 million generated in Q4 FY20
- Successful exit of the non-core investment in Berkley Recruitment (Group) Limited, delivering an IRR of 16.0% in April
- £35 million oversubscribed equity placing completed, increasing liquidity to fund the growing pipeline of investment opportunities
- Diversified and increased its revenue base through a €10.0 million investment into a new royalty partner, Fairmed Healthcare AG, a provider of high-quality generic prescription medicines, over-the-counter pharmaceuticals, dermocosmetics and dietary supplements in various EU countries
- Elected to exercise warrants granted to Duke from the previous royalty agreement with XtremePush (“XP”). Following the exercise, Duke will hold a 2.7% equity stake in the ordinary shares of XP. The exercise was undertaken concurrent with XP’s raise of US$33 million in growth capital to accelerate its global expansion.
- Based on current trading, Duke expects cash revenue for Q2 FY22 to be £3.2 million, which would again represent a record normalised cash revenue quarter for the Company
Neil Johnson, CEO of Duke Royalty, said:
“I am delighted to report that the Company delivered record normalised quarterly cash revenue in Q1 FY22, surpassing the previous highs that were generated prior to the destabilising effects of COVID. This performance is testament to both the resilience of our underlying royalty partners but also the hard work that has been invested by Duke’s investment team to successfully navigate these economic headwinds.
“Duke’s current strong liquidity position, combined with its deep pipeline of late stage deal opportunities, gives me confidence that further deployments will be completed in the short term that will translate into further increases in quarterly cash revenue for the benefit of all shareholders.”
