All amounts are in U.S. dollars unless otherwise indicated.
February 16, 2021, Vancouver, British Columbia – Maverix Metals Inc. (the “Company” or “Maverix”) (NYSE American & TSX: MMX) is pleased to announce record attributable gold equivalent ounces for the fourth quarter and full year ended December 31, 2020 and provide guidance for 2021.
Dan O’Flaherty, CEO of Maverix, commented “Maverix had another year of tremendous growth in 2020, achieving a new Company record for attributable gold equivalent ounces, exceeding our 2020 guidance, and expanding our royalty portfolio with the acquisition of 10 gold royalties. We look forward to building off this performance with further growth in 2021, driven in large part by the push towards development and production at a number of the underlying precious metals assets where we hold royalties.”
Fourth Quarter and Full Year 2020 Highlights
• Record fourth quarter attributable gold equivalent ounces sold of 8,8361, an increase of 25% from Q4 2019;
• Record annual total attributable gold equivalent ounces sold of 28,9161, exceeding guidance and an increase of 20% from 2019; and
• Acquired a portfolio of 10 gold royalties from Newmont Corporation, including a 2.0% net smelter return (“NSR”) royalty on the Camino Rojo project currently in construction, with the first gold pour expected in Q4 20212.
In 2021, Maverix expects 27,000 to 30,000 attributable gold equivalent ounces1 at approximately a 90% cash margin with approximately 99% of expected revenue derived from gold and silver. Similar to 2020, the Company expects gold equivalent ounces to be weighted towards the second half of the year.
Asset Portfolio Updates
Hope Bay (1% NSR)
On February 2, 2021, Agnico Eagle Mines Limited (“Agnico”) completed the acquisition of TMAC Resources Inc. and is now the owner of the Hope Bay mine in Nunavut, Canada. On February 11, 2021, Agnico announced that it plans to continue mining at the Doris deposit in 2021 with quarterly production expected to be approximately 18,000 to 20,000 ounces of gold. Agnico plans to ramp up a property wide exploration program in 2021 with 39,800 metres of drilling planned for exploration targets around the Doris, Madrid and Boston deposits and other targets along the 80 kilometre long greenstone belt. Agnico believes that Hope Bay has the potential to be a 250,000 to 300,000 ounce per year operation and will continue to evaluate optimal mining and milling strategies for future production.
Maverix and Agnico have completed the previously announced buy back of 1.5% of the net smelter return royalty that Maverix owns on the Hope Bay mine. Maverix received a cash payment of $50 million from Agnico on February 12, 2021. Maverix retains a 1% net smelter return royalty on the Hope Bay mine which is not subject to any further reductions.
For more information, please refer to agnicoeagle.com and see the news release dated February 11, 2021.
Moss (100% Silver Stream)
On February 12, 2021, Northern Vertex Mining Corp. (“Northern Vertex”) completed the previously announced business combination with Eclipse Gold Mining Corp. Pursuant to the terms of the business combination, Maverix sold 19,511,041 common shares of Northern Vertex and received net proceeds of approximately C$9.8 million, realizing a gain on the sale of approximately C$2.0 million.
Credit Facility Repayment
Maverix will use part of the proceeds received from the royalty buy back transaction with Agnico to repay the outstanding amount on the Company’s revolving credit facility. Post repayment of the credit facility, Maverix will be debt free and have access to the full $120 million available under its credit facility, while holding cash and short-term investments of approximately $50 million.
1 Maverix has included certain performance measures in this news release that do not have any standardized meaning prescribed by International Financial Reporting Standards (“IFRS”). The Company’s royalty revenue and silver sales are converted to an Attributable Gold Equivalent ounce basis by dividing the royalty revenue and silver sales for a period by the average gold price based on the LBMA Gold Price PM Fix per ounce for the same respective period. These Attributable Gold Equivalent ounces when combined with the gold ounces sold from the Company’s gold streams (individually and collectively referred to as “Attributable Gold Equivalent”) equal total Attributable Gold Equivalent ounces sold and may be subject to change. The presentation of these non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these non-IFRS measures differently. The 2021 forecast herein assumes a gold price of $1,700 per ounce and a silver price of $21 per ounce. The forecast was derived using information that is available in the public domain as at the date hereof, which included guidance and estimates prepared and issued by management of the operators of the mining operations in which Maverix holds an interest. The forecast is sensitive to the performance and operating status of the underlying mines. None of the information has been independently verified by Maverix and may be subject to uncertainty. There can be no assurance that such information is complete or accurate. Maverix’s business, operations, financial condition and financial outlook could be materially adversely affected by the continued impact of the COVID-19 global health pandemic. At this time, Maverix cannot reasonably estimate the duration of any potential business disruptions, impact to underlying operations that Maverix holds an interest in or any related financial impact that is related to or caused by COVID-19.
2 Transfer is subject to the authorization of the Federal Economic Competition Commission in Mexico (Comisión Federal de Competencia Económica).
Brendan Pidcock, P.Eng., is Vice President Technical Services for Maverix, and a qualified person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects, has reviewed and approved the scientific and technical disclosure contained in this news release.