Elemental Royalties Reports Record Third Quarter 2021 Revenue and Operating Cash Flow

VancouverElemental Royalties Corp. (“Elemental” or “the Company”) (TSX-V: ELE, OTCQX: ELEMF) is pleased to announce its operating and financial results for the three and nine months ended September 30, 2021.

For more details, please refer to the financial statements and the associated management report for the three and nine months ended. September 30, 2021, available on SEDAR (www.sedar.com) or on the Company’s website (www.elementalroyalties.com).

Frederic Bell, Elemental CEO commented: “Elemental generated record quarterly revenue following the first production of our operating partner at the Karlawinda gold mine. With operations reaching steady state at the end of the quarter, Karlawinda promises to be a cornerstone of Elemental’s portfolio for many years to come. In addition to the continued strong operating performance of Wahgnion, Elemental is now reimbursed for the acquisition in 2018 of the 2.25% NSR royalty on Southern gold Amancaya gold mine in Chile, making it the second royalty after Kwale to be fully refunded.

“We are also delighted to see operator-funded exploration efforts begin to uncover the value of our portfolio with the announcement of Effort a major multi-year exploration program at Wahgnion. Exploration success has the potential to generate significant shareholder value alongside continued organic revenue growth evidenced by the royalty at the Mercedes mine starting to contribute July 2022. This combination of growing revenue, ongoing free discoveries and royalty acquisition opportunities positions the company with the best platform for growth it has had. ‘

Asset highlights

Capricorn Metals (“Capricorn”) completed steady-state operations with production of 24,329 ounces of gold, with an above-budget recovery of 92.6%, generating first-time royalty income for Elemental of over 1 million Australian dollars sales of 21,921 ounces of gold in the third quarter of 2021.

Effort announced a discovery target of 1.5 to 2.0 million ounces of indicated resources at Wahgnion over the next five years with $ 5 million spent in the third quarter, consisting of 31,500 meters of drilling with a continued focus on the extension and expansion of the Nogbele mineralization.

Wahgnion produced 34 koz of ounces of gold in the third quarter and is positioned to meet the lower end of the 2021 production forecast of 140,000 to 155,000 ounces of gold at an AISC of $ 940 – 990 per ounce, for the post-acquisition period starting on February 10, 2021.

At Amancaya, the challenges of the quarter saw a total of 208 attributable GEOs sold in the third quarter, offering Elemental US $ 0.4 million returned. Production was lower than expected due to staff turnover within the underground mining contractor and the availability of the underground fleet. An action plan is implemented by Austral Gold Corp (“Austral”) to improve mine productivity and strengthen the underground stock.

Mercedes produced 9,722 ounces of gold in the third quarter. A substantial development program is underway to increase access to several ore bodies, with gold production on track to reach 30,000 to 35,000 ounces for the post-acquisition period on April 7, 2021 To December 31, 2021.

Financial Highlights

Record quarterly revenue of US $ 1.9 million for the third quarter of 2021 and 4.3 million US dollars for the nine months ended September 30, 2021 generated from five royalties, including Karlawinda’s first income received during the quarter.

Record 1,062 attributable ounces of gold equivalent1 (“GEO”) sold in the third quarter of 2021 and 2,385 attributable ounces of gold equivalent sold during the nine months ended September 30, 2021, at zero cash cost for the Company.

Record cash flows from operations of 0.8 million US dollars before working capital for Q3 2021 (approximately CA $ 0.015/ share) and 1.5 million US dollars for the nine months ended September 30, 2021.

Record Adjusted EBITDA1 of US $ 1.2 million for the third quarter of 2021, and US $ 2.4 million for the nine months ended September 30, 2021.

Net loss of 0.8 million US dollars for the third quarter of 2021, and US $ 3.1 million for the nine months ended September 30, 2021.

2021 forecast revised to 3,400 – 3,800 GEO due to revised production forecast at Amancaya during the quarter.

Organic growth expected in 2022 with a full year of Karlawinda sales and the Mercedes royalty payable from July 2022.

Cash and cash equivalents of 5.6 million US dollars from September 30, 2021.


In 2021, Elemental plans 3,400 to 3,800 attributable GEOs from its existing portfolio, with over 90% of expected revenues coming from gold and silver production. The revised GEOs for 2021 follow Austral’s updated production guidelines published in October 2021. In the first quarter of 2021, Austral announced that it expects production to increase in the second half of the year to meet targets of 45,000-50,000 GEOs for 2021. Despite gradual improvements at the mining complex of Guanaco / Amancaya, Austral has revised its production targets for 2021 to 30,000 – 35,000 GEO.

A tan 1,800 USD average gold price received per ounce, the expected 3,400 to 3,800 attributable GEOs would provide Elemental with revenues of US $ 6.1 To 6.8 million US dollars.

Elemental expects revenue growth to continue in 2022, with a full year of royalty revenue from Karlawinda and the first revenue from Mercedes expected in the third quarter of 2022.


Dustin Zinger

Phone. : +1 (604) 653-9464

Email: [email protected]

Web: www.elementalroyalties.com

On Elementary royalties

Elemental is a gold-focused royalty company listed on the TSX Venture Exchange in Canada and provides investors with low-risk precious metals exposure through a portfolio of nine high-quality royalties. This allows investors to benefit from continued royalty income, increased future exploration and low operating costs. Elemental’s experienced team seeks royalties in advanced precious metals projects, managed by established operators, from its pipeline of identified opportunities.

Caution Regarding Forward-Looking Statements

This press release contains certain “forward-looking statements” and certain “forward-looking information” as defined by applicable Canadian securities laws. Forward-looking statements and information can generally be identified by the use of forward-looking terms such as “may”, “will”, “should”, “expect”, “intend”, “estimate”, ” anticipate ”,“ believe ”,“ continue ”,“ plans ”or similar terminology.

Forward-looking statements and information include, without limitation, statements regarding the future growth and development of the Company. Forward-looking statements and information are based on forecasts of future results, estimates of amounts not yet determinable and assumptions which, although deemed reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond Elemental’s ability to control or predict, which may cause Elemental’s actual results, performance or achievements to differ materially from those. expressed or implied. thus, and are developed based on assumptions regarding those risks, uncertainties and other factors set forth herein, including, but not limited to: the requirement for regulatory approvals and third party consents, the impact general business and economic conditions, the lack of control over mining operations from which Elemental will receive royalties, including risks related to international operations, government relations and environmental regulations, risks inherent in exploration and development mining properties; uncertainties related to the interpretation of exploration data; the potential for delays in exploration or development activities; the geology, grade and continuity of mineral deposits; the impact of the COVID-19 pandemic; the possibility that future exploration, development or mining results will not meet Elemental’s expectations; accidents, equipment failures, title issues, labor disputes or other difficulties or unforeseen interruptions of operations; fluctuating metal prices; unforeseen costs and expenses; uncertainties about the availability and costs of necessary funding in the future; the uncertainty inherent in production and cost estimates and the potential for unforeseen costs and expenses, fluctuations in commodity prices; currency fluctuations; regulatory restrictions, including environmental regulatory restrictions; liability, competition, loss of key employees and other related risks and uncertainties. Elemental assumes no obligation to update forward-looking information, except as required by applicable law. This forward-looking information represents management’s best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary significantly. Therefore, readers are advised not to place undue reliance on forward-looking statements or information.

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