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RNS Number : 4430I Ecora Resources PLC 27 March 2024
27 March 2024
Ecora Resources PLC
("Ecora", the "Company" or the "Group")
Initiation of share buyback programme
Ecora Resources PLC (LSE/TSX: ECOR), the leading royalty company focused on
supporting the supply of commodities essential to creating a sustainable
future, today announces the initiation of a share buyback programme to
purchase ordinary shares of 2 pence each in the Company ("Ordinary Shares")
for up to a maximum aggregate consideration of US$10 million (£7.9 million)
from the date of this announcement (the "Buyback Programme").
Ecora has a portfolio of high-quality royalties located in established mining
jurisdictions with leading operating partners. The portfolio combines near
term volume growth with a pipeline of development projects that should drive
material revenue growth and offers a compelling expected returns profile.
The purpose of the buyback is to take advantage of a capital allocation
opportunity as the Board is of the view that the shares are trading at a
substantial discount to net asset value offering a compelling expected returns
profile underpinned by a portfolio of high-quality royalties. The capital
outlay will primarily be funded by the proceeds of from the Company's recent
partial LIORC stake sale.
The Buyback Programme is in line with the newly announced capital allocation
framework which is designed to directly link dividends to free cash flows,
maintain balance sheet strength, provide an attractive dividend yield, and
retain the flexibility to allocate capital to enhance the Company's royalty
portfolio via. accretive royalty acquisitions.
Marc Bishop Lafleche, Chief Executive Officer of Ecora, commented:
"Cyclical market lows present an opportunity for Ecora to buy-back its shares
which are currently trading at a substantial discount to NAV. As such, and in
line with our updated capital allocation framework, our US$10 million
programme will be highly accretive to our per share metrics.
"We remain in a strong position to acquire royalties that further diversify
and grow our business to deliver long-term sustainable returns and to align
with society's shift towards a low-carbon economy."
Process
To facilitate the Buyback Programme, Ecora has today entered into an
engagement with Peel Hunt LLP ("Peel Hunt") under which it has issued a
non-discretionary irrevocable instruction to Peel Hunt to repurchase Ordinary
Shares in the Company to be held in treasury. The agreement provides Peel Hunt
with authority to carry out market purchases under the Buyback Programme
independently of the Company within the agreed parameters. The Buyback
Programme will commence today, 27 March 2024, and end no later than 27
September 2024. Purchases may continue during any closed periods of the
Company during this period.
Purchases pursuant to the Buyback Programme will be conducted in accordance
with the general authority to re-purchase Ordinary Shares granted by the
Company's shareholders at the 2023 annual general meeting. All Ordinary Shares
purchased under the Buyback Programme will be purchased within the price
parameters as specified in the relevant shareholder authorities. The maximum
number of shares that may be purchased under the existing authorities is
25,790,340 ordinary shares.
Due to the limited liquidity in the Ordinary Shares, a buy-back of Ordinary
Shares on any trading day may represent a significant portion of the daily
trading volumes in the Ordinary Shares and may exceed 25% of the average daily
trading volume specified in the provisions of the UK version of the Market
Abuse Regulation (596/2014/EU) 1 dealing with buyback programmes and
accordingly the Company may not benefit from the exemption in Article 5(1) of
that regulation.
The purchases will take place on the London Stock Exchange only and not on the
Toronto Stock Exchange. Details of any purchases made under the Buyback
Programme will be provided via RNS announcements and published on the
Company's website.
For further information:
Ecora Resources PLC +44 (0) 20 3435 7400
Geoff Callow, Head of Investor Relations
Jason Gray, Company Secretary
Website: www.ecora-resources.com (http://www.ecora-resources.com)
FTI Consulting +44(0) 20 3727 1000
Sara Powell / Ben Brewerton / Nick Hennis ecoraresources@fticonsulting.com (mailto:ecoraresources@fticonsulting.com)
About the Ecora Resources
Ecora Resources is a leading royalty company focused on supporting the supply
of commodities essential to creating a sustainable future.
Our vision is to be globally recognised as the royalty company of choice
synonymous with commodities that support a sustainable future by continuing to
grow and diversify our royalty portfolio in line with our strategy. We will
achieve this through building a diversified portfolio of scale over high
quality assets that drives low volatility earnings growth and shareholder
returns.
The mining sector has an essential role to play in the energy transition, with
commodities such as copper, nickel and cobalt - key materials for
manufacturing batteries and electric vehicles. Copper also plays a critical
role in our electricity grids. All these commodities are mined and there are
not enough mines in operation today to supply the volume required to achieve
the energy transition.
Our strategy is to acquire royalties and streams over low-cost operations and
projects with strong management teams, in well-established mining
jurisdictions. Our portfolio has been reweighted to provide material exposure
to this commodity basket and we have successfully transitioned from a coal
orientated royalty business in 2014 to one that by 2026 will be materially
coal free and comprised of over 90% exposure to commodities that support a
sustainable future. The fundamental demand outlook for these commodities over
the next decade is very strong, which should significantly increase the value
of our royalty portfolio.
Ecora's shares are listed on the London and Toronto Stock Exchanges (ECOR) and
trade on the OTCQX Best Market (OTCQX: ECRAF).
1 This is part of UK law by virtue of the European Union Withdrawal Act
2018.
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