Canadian Mining Journal


Altius reaps benefits of contrarian investing

VANCOUVER – When it comes to the project generator business model, it’s tough to find a more successful example than Altius Minerals (TSX: ALS; US-OTC: ATUSF). The company’s seen substantial revenue growth over the past five years largely due to its contrarian investment strategy, which saw it add 13 production stage royalties to its portfolio and boost revenues from less than 10¢ to more than $1 per share.

On Sept. 12 Altius released its second quarter financial results headlined by adjusted earnings of $6.4 million, or 15¢ per share. The company expects to generate $40 million per year in revenue going forward, which is especially impressive considering it was $3 million per year in 2013.

And Altius has achieved its success largely by investing in commodities that are out of favour. The company’s largest revenue generator is actually thermal coal, while it’s also heavily invested in fertilizers via royalties on mining operations run by Potash Corp. of Saskatchewan (TSX: POT; NYSE: POT) and Agrium (TSX: AGU; NYSE: AGU).

Altius’ most recent deal involves the acquisition of future copper payments from Yamana Gold‘s (TSX: YRI; NYSE: AUY) Chapada copper‐gold mine in central Brazil. The company paid US$60 million and 400,000 shares for 3.7% copper production from the operation, which drops to 1.5% for remaining life of mine after 75 million lb are delivered.

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