Company Interviews
Empress Royalty (TSXV:EMPR) - Chairman Bullish on Company's Potential to Deliver Significant Growth
26 Nov 2024
Interview with David Rhodes, Executive Chairman of Empress Royalty Corp.Our previous interview: https://www.cruxinvestor.com/posts/empress-royalty-tsxvempr-rapid-revenue-growth-on-gold-and-silver-stream-scaling-to-larger-deals-5970Recording date: 23rd November 2024Empress Royalty Corp (TSXV:EMPR) is an emerging precious metals royalty and streaming company. The Chairman believes that despite strong revenue growth and a solid portfolio of cash-flowing assets, Empress trades at a significant discount to its peers, with a market cap of just US$35 million.The company's business model involves creating bespoke royalties and streams by investing in near-production assets where it can add value. This approach has proven successful, with Empress reporting revenue of US$5.4 million in Q3 2024 and expecting to exceed US$6 million for the full year. The company projects revenue to surpass US$10 million in 2025 based on its existing assets, which include producing mines in Mexico, Mozambique, Peru and South Africa.Empress' cornerstone asset is the Tahuehueto silver project in Mexico, which is expected to reach commercial production in Q4 2024. The company also holds a gold stream on the Galaxy mine in South Africa, which is undergoing an expansion to reduce costs and increase revenue. With cash flow from operations and available credit, Empress is well-positioned to make additional accretive investments and further grow its revenue base.According to David Rhodes, Executive Chair, Empress trades at a significant discount to peers, with comparable royalty and streaming companies trading at an average of 25x operating cash flow. Even at a conservative multiple of 10x cash flow, Empress' projected 2025 revenue implies a fair market cap several times higher than its current valuation. This valuation disconnect provides investors with an attractive entry point and significant upside potential as the company executes its growth strategy.Empress benefits from an experienced management team and strategic partnerships, including a relationship with Endeavour Financial, which provides a strong pipeline of potential investment opportunities. If the revenue growth story plays out and the market takes notice as all predicted by Rhodes, Empress shares have strong re-rating potential to trade more in line with peer valuations.In the current macroeconomic environment of high inflation, geopolitical tensions, and economic uncertainty, precious metals are attracting significant investor interest as safe-haven assets. Royalty and streaming companies like Empress provide an attractive way to gain exposure to rising gold and silver prices with a lower risk profile than mining operators. As investors increasingly turn to precious metals as portfolio hedges, companies with growth prospects, like Empress, present an interesting investment opportunity.View Empress Royalty's company profile: https://www.cruxinvestor.com/companies/empress-royaltySign up for Crux Investor: https://cruxinvestor.com
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