Author Topic: ALS.TO - Altius Minerals  (Read 2036666 times)

Williams406

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Re: ALS.TO - Altius Minerals
« Reply #7400 on: November 17, 2020, 09:21:51 AM »
RE Champion Kami purchase, I wonder how much Champion needs the reserves? Seems like Altius' 3% royalty on Kami ensures those resources are mined so far in the future  the royalty NPV for Altius is de minimis. Supposedly it was a competitive process, I wonder who Altius wanted to wind up with the asset.

https://globalminingobserver.com/ See "Ticking Clock" about halfway down for a short non-precious metals royalty piece. New-player Trident CEO comments and Deterra mentioned. Nothing earth-shaking.


nostradamus

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Re: ALS.TO - Altius Minerals
« Reply #7401 on: November 24, 2020, 06:18:26 AM »
Nice long uplifting interview with Brian Dalton:

https://www.youtube.com/watch?v=Lvw0KdilE7Y

He thinks the renewables arm of the business could ultimately eclipse all the other elements. As a long standing shareholder (who was initially quite skeptical about the renewables arm), I hope he is right. He certainly sounds confident.

Thrifty3000

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Re: ALS.TO - Altius Minerals
« Reply #7402 on: November 24, 2020, 08:28:02 AM »
He has also said the potash royalties could be worth the current market cap of the business (around $500 mil at the time) 10 years from now.

Gregmal

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Re: ALS.TO - Altius Minerals
« Reply #7403 on: November 24, 2020, 08:32:32 AM »
The great thing about protections that are 10 years out....not many current shareholders will be around then to hold you to them.

cwericb

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Re: ALS.TO - Altius Minerals
« Reply #7404 on: November 24, 2020, 03:58:03 PM »
At this rate I'm thinking, oh well only another ten years...
ALS stock makes GIC's look good. sigh...
Politicians and diapers must be changed often, and for the same reason. - Mark Twain

Sunrider

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Re: ALS.TO - Altius Minerals
« Reply #7405 on: November 25, 2020, 02:11:38 PM »
The great thing about protections that are 10 years out....not many current shareholders will be around then to hold you to them.
Indeed ... I think this has been dead money for me for nearly ten ... but hey they say they are increasing value all the time!

cuchulainn

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Re: ALS.TO - Altius Minerals
« Reply #7406 on: November 26, 2020, 04:13:12 AM »
Book Value per share April 2015    $8.06
Book Value per share Sept 2020.   $5.58  (ex pref shares)

Admittedly, BV as a value metric is limited and has flaws but the compound growth in royalty revenue cited continually by management, does not seem to be translating into growth for shareholders.

Am I missing something?

Williams406

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Re: ALS.TO - Altius Minerals
« Reply #7407 on: November 27, 2020, 05:52:20 AM »
For those interested, this is the transcript of a good interview with Dalton recently.

https://articles.cruxinvestor.com/altius-minerals-als-green-economy-royalty-group-attracts-big-money-transcript

reader

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Re: ALS.TO - Altius Minerals
« Reply #7408 on: November 27, 2020, 05:57:55 AM »

"Labrador Iron Ore Royalty Corporation (the "Corporation") announced that Iron Ore Company of Canada ("IOC") has declared a dividend payable on December 17, 2020.  The Corporation's portion is the U.S. $67,950,000 or about CDN. $88.3 million."


https://labradorironore.com/news/iron-ore-company-of-canada-dividend-2059/

omagh

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Re: ALS.TO - Altius Minerals
« Reply #7409 on: November 27, 2020, 07:51:28 AM »
Book Value per share April 2015    $8.06
Book Value per share Sept 2020.   $5.58  (ex pref shares)

Admittedly, BV as a value metric is limited and has flaws but the compound growth in royalty revenue cited continually by management, does not seem to be translating into growth for shareholders.

Am I missing something?
Take a free cash flow view.  The growth in FCF is the forward view and shows what Dalton's re-orientation of the company into a royalty holder has done.  It's an investment company with small capital requirements.  All of the operating cash flows are being reinvested.  For some of their investments, they act as the GP and then do capital raises to do the build and to operate.  For others, they are just a royalty holder.  They have opened up new markets (metals, minerals, power) to what is in effect a high-rent capital with long durations.  They have been able to gather a set of partners who are capital providers.  They have a steady pipeline of reinvestment opportunities.

In March 2020, ALS was down below 10x normalized 2020 FCF which made for a decent entry point.  FCF has grown from -$21M in 2015 to $30M (TTM) on a fairly steady path.  Altius has also been returning capital to shareholders via share repurchases and a modest dividend.  Today, Altius is at 15x normalized FCF.

On the negative side, Altius is in a business which has some speculative investments that occasionally need to be written down.  Conversely, Altius takes a value-based approach, maintains decent capital levels and expects to buy assets and future cashflows at significant discounts.  Past history shows in cyclical industries that commodity prices fluctuate wildly based on supply and demand which gives them the opportunity to buy at a discount and sell at a premium depending on the market cycle point. 

Many on this board have bought looking at the potential cyclical commidity premium story, where a compounding cashflow story is more realistic.  YMMV.