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Duke Royalty increases dividend again after solid first half

By Josh White

Date: Friday 06 Dec 2019

Duke Royalty increases dividend again after solid first half

(Sharecast News) - Alternative capital solutions provider Duke Royalty reported a 119% improvement in revenue in its interim results on Friday, to £5.9m.
The AIM-traded firm said its positive net cash inflow from operations rose 195% year-on-year to £3.9m, for the six months ended 30 September, while its net profit before tax was £3.7m, compared to £1.1m a year earlier.

It completed two follow-up investments into Welltel Ireland and Step Investments during the year, totalling £1.65m, and extended three senior loan agreements with existing royalty partners, increasing its future cash flows.

The firm entered into a new £30m revolving facility agreement with its existing debt provider, Honeycomb Investment Trust, on improved terms, which the board said provided it with greater financial flexibility.

It said it strengthened its operational team during the half-year, to reflect the scale it achieved during the period, and post period end, it raised £17.45m via a placing, an open offer and a retail offer to build its royalty portfolio, and to pay down its inherited credit facility.

During the period, Duke paid quarterly dividends of 0.7p per share to shareholders on 17 April and 0.7p per share on 12 July.

Additionally, for the September quarterly dividend, the board announced its third increase to 0.75p per share.

That increase was in line with its strategy to maintain a "high and stable" dividend, the directors said.

"I am delighted to report that the first half of 2019's activities have materially increased our revenue, profitability and cash flow," said chief executive officer Neil Johnson.

"Having entered the second half of the year with a strong pipeline of new royalty opportunities and greater financial flexibility, thanks to our new credit facility and our recent successful equity raise, we are confident that we can continue the rapid growth achieved to date."

Johnson said that importantly, the company increased its dividend for the third time since inception, in line with its strategy, due to the follow-on investments made in existing royalty partners.

"We look forward to supporting our existing royalty partners further and making additional investments during the period to build on the rapid growth achieved to date."

At 1443 GMT, shares in Duke Royalty were up 0.63% at 48p.

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