RE Royalties Ltd. (TSXV: RE, OTCQX: RROYF), a prominent player in renewable energy royalty-based financing, has released its financial results for the third quarter ending September 30, 2024. The company reported a quarterly revenue of $1,692,000 CAD ($1,202,900 USD), reflecting a 12% decline compared to the same period last year. This decrease is primarily attributed to reduced finance income due to early loan repayments by clients during the quarter.
For the year-to-date period ending September 30, 2024, RE Royalties recorded total revenue of C$6,157,000 ($4,546,000 USD), marking a 14% decrease from the previous year. This decline was influenced by a significant one-time royalty buyout of C$1,564,000 ($1,111,901 USD) that occurred in the prior year but did not recur in the current period.
The company’s gross profit for Q3 2024 was reported at $1,587,000 CAD ($1,128,252 USD), also down by 12% year-over-year. However, there was a notable improvement in Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), which reached $1,038,000 CAD (approximately $737,949 USD). This figure represents an increase of over 100% compared to Q3 2023 due to the absence of a substantial provision for expected credit losses that had impacted last year’s results.
Despite these challenges in revenue generation, RE Royalties reported a significantly reduced net loss after income tax of $195,000 CAD ($138,632 USD) for Q3 2024. This is a marked improvement from the net loss of $2,769,000 CAD ($1,968,576 USD) reported in the same quarter of the previous year. As of September 30, 2024, the company’s cash and cash equivalents stood at $18,442,000 CAD ($13,111,047 USD).
During the third quarter of 2024, RE Royalties achieved notable advancements in its business operations alongside its financial performance. The company successfully completed brokered and non-brokered private placements of Series 4 Green Bonds in August and November, raising a total of $5,879,000 CAD ($4,179,581 USD) and US$340,000 to support ongoing projects.
Additionally, RE Royalties was recognized by the Globe and Mail as one of Canada’s Top Growing Companies for the second consecutive year, achieving an impressive ranking of No. 136 based on a remarkable three-year revenue growth rate of 314%. Furthermore, the company entered into several strategic agreements to expand its renewable energy portfolio. This included a secured loan agreement with Abraxas Power Maldinvest Ltd. for up to $10 million CAD ($7,109,341USD) to support solar projects in the Maldives, a secured loan of $3 million CAD ($2,132,802 USD) with SolarBank Corporation for three Battery Energy Storage System projects in Ontario, and a secured loan to Alpin Solar SA for a letter of credit supporting the Sol Aurora Project in Alberta valued at $6.3 million CAD ($4,478,885 USD).
Bernard Tan, CEO of RE Royalties Ltd., expressed optimism about the company’s trajectory: “Since our last quarterly update, our team has made tremendous progress with the completion of three new investments totaling over $10.7 million CAD with existing and returning clients.” He emphasized that with robust cash reserves and ongoing evaluations of new opportunities, RE Royalties is well-positioned to enhance its revenue streams and profitability in the upcoming quarters.
RE Royalties is actively advancing its role in the renewable energy sector by implementing innovative financing solutions and investing in projects across diverse regions, including Canada and international markets such as the Maldives and Alberta. The company is dedicated to fostering sustainable growth for its shareholders while making a positive contribution to global energy transitions.
