Elemental Royalty (TSX: ELE) took in US$20.8 million in revenue in the third quarter, down from US$23.8 million in the second quarter. A softer gold price and storm disruptions at the Caserones copper mine accounted for most of the decline. Revenue was still about triple the US$6.9 million recorded a year earlier, before the merger with EMX Royalty.
Net income rose to US$3.8 million from US$3.6 million in the prior quarter. Earnings were flat at US$0.06 per share. Adjusted EBITDA fell 4.7% to US$16.6 million, operating cash flow dropped 15% to US$13.2 million, and general and administrative expenses rose to US$6.0 million from US$5.6 million.
The average gold price for the quarter was US$4,282 per ounce, compared with US$4,533 in the second quarter. Even so, adjusted EBITDA came to about US$3,418 per GEO, up from roughly US$3,323, and the EBITDA margin widened to nearly 80% of revenue from 73%.
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The balance sheet changed far more than the income statement. Cash fell to US$23.0 million at the end of September from US$74.2 million three months earlier. The company also ended the quarter with US$30.0 million drawn on a revolving credit facility it hadn’t used at the end of June. After quarter end, Elemental drew another US$180.0 million, which took borrowings to US$210.0 million. Over the same period it closed on 4 of the 5 streams and royalties it is buying from Orion Mine Finance for US$290 million in total, and it raised the facility to US$250 million.
Chief Executive Officer Frederick Bell framed the spending as a platform for growth. “Our priority is to translate this growth into increasing cash flow and value per share,” he said. Elemental also plans to sell its royalty generation business to Carlin East, which it expects to cut corporate G&A by more than 25%.
Gold equivalent ounce sales meanwhile came to 4,861, down 7.4% from 5,248 in the second quarter. Severe winter storms halted operations at Caserones for about 30 days, cutting its revenue to US$3.1 million from US$6.7 million. Bonikro remained the largest contributor with US$5.3 million, and the newly expanded processing plant at Karlawinda began continuous operation in September.
GEO sales for the first 9 months reached 15,092. That leaves the company on pace for its narrowed 2026 guidance of 18,000 to 20,500 GEOs from the existing portfolio, which cut the top of the range from 21,000 and lifted the bottom from 17,000. Revenue guidance was tightened to between US$80.5 million and US$90.5 million. The Orion assets should add about 1,500 more GEOs on an economic basis.
Elemental Royalty last traded at $22.85 on the TSX.
