Good morning, ladies and gentlemen. My name is Julie, and I will be your conference operator today. At this time, I would like to welcome everyone to the Altius Minerals Corp. Q3 twenty eighteen Financial Results Conference Call. All lines have been placed on mute to prevent any background noise.
After the speakers' remarks, there will be a question and answer session. I would now like to turn the call over to Flora Wood, Director of Investor Relations. You may proceed.
Thank you, Julie. Good morning, everyone, and welcome to our Q3 conference call. Our press release and filings were done yesterday after the close and are available on our website. This event is being webcast live with a link on our homepage and in the Investors section, and you'll be able to access a replay of the call along with the presentation slides, which are on the webcast and added to our website. In the room with me, I have Brian Dalton, CEO, and Ben Lewis, CFO, who will both be speaking on the call.
And the room we're in isn't in St. John's this time. Just to tell you, we're in Toronto this time. And we'll open up for questions after the formal remarks. Just getting started, the forward looking statement is on slide two and applies to everything we say both in the opening remarks and the Q and A.
And with that, I'll turn over to Ben to take us through the numbers.
Thank you, Flora, and good morning, everyone. Thank you for joining. Obvious generated $17,100,000 in royalty revenue during the quarter compared to $16,500,000 in Q2 and $17,900,000 of Q3 of last year. Brian will provide a little more color on our royalty revenues later in the call. EBITDA for the quarter came in at $13,900,000 or $0.32 per share.
The EBITDA margin at a little over 81% remained fairly consistent with both Q2 and the comparable period last year. Earnings per share was $0.14 during the third quarter compared to $0.12 in Q2 and $0.16 in the comparable period last year. Our Q3 earnings included a couple of noncash items, the largest of which was dilution gains and earnings from associates, which had a positive impact of about 2,000,000 or a little under $05 per share. General and administrative expenses of $1,900,000 are up approximately $200,000 from the same period last year and similar to Q2 levels of approximately $2,000,000 The year over year increase in G and A was driven by corporate development and legal services activities. Income taxes of approximately $1,500,000 are slightly higher than the Q2 1,100,000.0 comparable number as a result of higher income.
We ended the quarter with 33,800,000 in cash and cash equivalents. We put some of our surplus cash to work during the quarter, using $8,700,000 to buy additional Labrador Iron Ore Royalty Corporation shares, and we made another investment of $2,000,000 through our rights to co invest alongside Lithium Royalty Corporation. Other uses of cash during the quarter included a scheduled $5,000,000 payment on our term debt, 1,250,000.00 preferred share distribution as well as our regular quarterly cash dividend of $04 per share. And finally, we were active on our share buyback, spending $2,600,000 during the quarter to acquire two twelve of 300 Albia shares, which have been returned to treasury. Total cash and market investments at the end of Q3 were approximately $175,000,000 And I'll remind you that we have an unused revolving credit facility of 100,000,000 Thus, we have ample liquidity to pursue opportunities as they arise.
So in summary, Altice had another great quarter with solid cash flow from our diversified royalty business. Net earnings came in as expected and we continued our balanced approach to capital allocation during the quarter. And now I'll turn it over to Brian.
Thank you, Ben. Good morning and thank you all for joining. The quarter and year to date have unfolded reasonably well and demonstrated the value of our diversified portfolio as headwinds at some operations were offset nicely by tailwinds at others, allowing us to maintain our royalty revenue guidance. First for the headwinds, copper and zinc prices were down and revenue from $7.77 was impacted by lower grades and a timing lag between production and sales. These were partially offset by an encouraging recovery in operational volumes at that particular mine.
Thermal coal revenue was down as mining at Sharon has moved on to lower paying royalty lands as part of its normal mine sequencing. We continue with preparations to initiate legal action to seek compensation for governmental policy changes that will cause our thermal coal royalty revenue to end by 02/1930, significantly earlier than was allowed under the policies in place at the time of our acquiring the royalties. We expect to be in a position to file a statement of claim before year end. Turning now to the positives, potash prices were sharply higher and strong global demand growth, while Rokenville and Esterhazy continued to ramp up. With these factors multiplying by our recently increased royalty ownership level, potash accounted for approximately 25% of our revenue total for the quarter.
Chapada production was Solid and Yamana has increased its full year copper production guidance to 125,000,000 pounds from 120,000,000 previously. This mine typically performs better in the second half of the year as the first half is impacted by the Brazilian rainy season. Premiums for high quality iron ore concentrates and pellets remained robust and IOC was largely able to return to a normal production volume range following the strike in quarter two. We increased our Labrador Iron Ore Royalty Corporation ownership during the quarter by approximately 344,000 shares and now hold 5.46% of that company. The revenue impact to Altius was lower than expected.
However, as Labrador Iron Ore Royalty Corporation made an election to withhold a significant portion of its cash flow to its balance sheet in contrast with more typical focus on delivering a high dividend payout ratio. Bear with me. Metallurgical coal revenue from Tex Cardinal River mine was up on improved production volumes and prices. We received a lot of encouraging news during the quarter related to potential extensions, expansions and new future royalties. I'll begin by speaking on Voisey's Bay.
We were happy to reach a settlement with Vale that will see payments resume. While this is hardly a new royalty for us, I included in this part of my remarks because it does feel as if it's a new or at least a resurrected royalty after two years of nonpayment. Based upon questions we received upon press release of the settlement, I think it is worthwhile to further clarify the press release description of the 3% royalty as representing approximately 50% of the gross metal value at current prices. This seems to have confused some investors into thinking we accepted 50% of the intrinsic royalty value. But in fact, this refers to the gross metal value less normal NSR type deductions with the result approximating well what we always believe to be the royalty value.
Importantly, this now very well defined royalty calculation formula applies to all future mining potential at Voisey's Bay, including newly approved underground development plan for the extensive Eastern Deeps deposit. At Cardinal River, Teck has announced that it is studying the opening of a new pit on our royalty lands that could extend mining from the original 2020 plan to around 2027. Yamana continues with studies aimed at expanding production levels at Chapada in recognition of strong exploration and delineation results from several areas within the land covered by our streaming agreement. Excelsior made two significant announcements related first to the completion of its permitting process at the Gunnison Copper Project in Arizona. And secondly, completion of project financing through a stream and equity arrangement with Triple Flag.
This moves the project into development and triggers an option that we hold to increase our gross revenue royalty for CAD5 million. We do intend to exercise this option and look forward to Gunnison becoming our sixteenth paying royalty in the near future. Alderon provided results from an updated feasibility study for its Kami iron ore project. The study showed strong economics based upon its expected premium quality product, fully permitted status and access to existing infrastructure. Financing alternatives and other strategic avenues are currently being explored among stakeholders in support of moving the project into development.
We are large equity holders of Alderon and also hold a project royalty. Allegiance Coal made excellent progress in advancing its Telco metallurgical coal project in British Columbia. It announced that Japan's Etuchu has joined it as a joint venture partner as a joint venture financing partner and product marketer. An updated feasibility study is expected early in the New Year and the permitting process has begun. Telco came to us as part of our acquisition of royalties and lands from Sherritt a few years back, and we then vended it to Allegiance for a significant equity stake in a sliding scale royalty.
Moving on to our Project Generation business, there are also quite a few positive developments to update. Our portfolio of PG equities increased in value to $68,000,000 at quarter end from $44,000,000 at the end of the last quarter, despite a relatively weak period in the market for junior exploration companies. Adventist continued to report excellent infill drilling results from its polymetallic Feripampa project in Ecuador. These largely focused on better defining a very copper and gold rich zone within the El Domo deposit that could feature prominently in an updated study that is expected to be completed in early twenty nineteen. It is now turning its attention to testing several exploration targets that offer the potential the discovery of additional satellite deposits.
Adventist also added another strategic investor during the quarter as Wheaton Precious Metals made a significant equity investment while securing rights to potential future precious metal streams. Everest has begun a first ever drilling program at its Kuale gold project in Mexico, where very exciting surface trench results have been reported. It recently attracted Newmont as a major strategic equity investor and also announced that it reached an agreement with First Majestic that will see it hold a royalty on the resource delineation stage or Mataneo project. We are a large shareholder of Ebrum and hold a royalty on the Kuale project. Stockholm and Iron has reported high grade drilling results for the Moosehead Gold project in Newfoundland and has raised significant equity through a placement led by well known investor Eric Sprott.
Our planned diamond spin out, Adia Resources has announced that De Beers Canada is coming on board as an early stage investor by providing an in kind contribution of technical services. Drilling on the LINX project is planned for this coming winter with an IPO to follow. We are also absolutely delighted to announce that Marco LoCascio, well known to many of you in his prior role as a highly successful New York based resource investment manager, has come on board to lead Adia as its new CEO. That wraps up our formal remarks, and we'll turn back to the operator for the Q and A.
Your first question comes from Carey MacRury with Canaccord Genuity. Please go ahead. Your line is open.
Hi. Good morning,
Hey, Gary. Morning.
Question on Voisey's. I know the royalty is effective back to April 1. Just wondering for the amount you received this quarter, what time period does that correlate to?
This is Ben. The first payment we received was for the period ending June 30, and we will catch up at some point. But that was part of the settlement, so that's that's been delivered. And we should have a catch up period where we'll where we will have two quarters recognized in revenue. And the next payment was is actually November 15, and then we'll follow thereafter.
So the two quarters, would you expect that in Q4 or
June, Probably let's Q4, but it really depends on what information we get from Vale as well and just to make sure we can do an accurate estimate.
And then secondly, secondly on the Lithium Royalty Corporation, you've got $8,000,000 invested there for a 10% stake. That's pretty sizable. I'm just wondering if you can provide a little context of what types of assets you're looking at there. Are these developed lithium development stories? Are they producing?
Is it all the above? Any color you can provide on that?
Yes, it's Brian here, Carey. The $8,000,000 isn't entirely for the co participation rate. It also includes direct investment at the equity level in LRC. LRC is right now its focus is mainly has mainly been on development stage projects. The market has actually been pretty good if you're a buyer in that space, things it hasn't been a fantastic year for lithium prices and that's created good opportunity.
So we're pretty encouraged about the quality of the projects that team has been able to gain traction with. Hopefully, we'll be able to provide you with some more color on that in the coming quarters, but it's a pretty busy time and lots of strategic files open there.
And are these all over the globe or is
there more of a focus on Global search.
Then maybe one last question on the hydroelectric opportunity that you're pursuing in terms of royalties, any progress on that front?
Yes, not just hydro, obviously renewables generally. Yeah, that's been really moving along over the last four or five months. The focus has been largely on trying to secure royalties related to development stage rather than operating stage opportunities. And that's because the kinds of returns we could expect from production stage we're finding are too low. The space is quite crowded once these projects are fully buttoned down, but we are finding good opportunity at the development stage and we feel we're pretty close to securing our first batch of royalties there.
And is there still an opportunity to kind of roll the coal assets into that or is
that Yes.
I don't think we'll actually roll the coal assets in, but the idea there, concept we're running with is to reinvest an equivalent amount of royalty revenue from the coal portfolio into renewable assets. And if we play that right, the long term effect should be to essentially replace the coal royalty streams, the last of which are legislated to end in 2030 and essentially turn them into perpetual royalties. So it's less of a formal linkage, but that's the investment rationale and sort of how we're thinking about it when we plan our broader corporate capital allocation work for the next few years.
Great. Thanks, Brian and Ben.
Thank you, sir. Your
next question comes from Jacques Wortman with Eight Capital. Please go ahead. Your line is open.
Hi, good morning guys. Your decision to increase your position in Lyft is kind of interesting as you have disclosed publicly that you oppose any change in mandate to amend business restrictions. And although they haven't closed the door on that at Lyft, they have deferred that meeting. Can you just go over the decision making process to increase your interest at this time?
We keep pretty close tabs on the operations at IOC and we like everyone else could see that not only were premium strong, but there are steady operational improvements at that asset. So at point late in the quarter, we felt that the value represented by the share price was good enough to make another move. We had extra cash balance on sheet. It obviously wasn't a huge investment for us, but we'd see ourselves as being opportunistic in the future there as well. As far as the decision or the talk of expanding mandate whatnot, we were happy to read in the report last night from Labrador Iron Ore that they have elected not to call that shareholder vote now.
For us, the interest is essentially when we see it as a flow through of royalty income and we'd rather not deal with anything that might change the historical pattern of high payout of that royalty revenue on to shareholders. That's really what allows us to treat it in our minds at least as a royalty interest. But once there are extra corporate factors involved there, our motivation would decrease. So we're very happy with that decision.
Okay. Thanks a lot, Brian. Good quarter.
Thank you. You too.
Your next question comes from Joseph Levittino with Jalispan. Please go ahead. Your line is open.
Yes, good morning. Question concerns the year Alderon. In my mind, it seems that Alderon's coming up against some hard stops over the next year or so, and I'm just wondering whether Altius has conducted any thought experiments regarding the outcomes for Alderon.
I don't know about thought experiments, but we're obviously involved very heavily with that file. There's really not much that could happen that could impact us as positively as go decision or financing for the CAMI project. Have a pretty sizable royalty there. The time feels like it should be around now, we're watching other developments in the Labrador Trough. Obviously, IOC is performing extremely well.
There are rumors out there Rio Tinto is looking to sell its stake. So that's obviously bringing lots of attention from strategic investors towards the trough, whatever marketing and efforts that they've been doing certainly, bringing many eyeballs there. Plus, we've been gratified to watch the great success that Champion Iron Ore has been having with the restart of the Bloom Lake project. So a lot of really positive things going on in the Labrador Trough right now. And the CAMI project is fairly unique in the world right now in terms of being a project that can deliver the very high grade high quality product that the market is short of right now in a project that is fully permitted and linked to existing infrastructure.
Obviously, you look at the market value of Alderon today, it doesn't look like there are many pure market based financing solutions right now, the market cap relative to the capital requirement is the gap there is pretty wide. But we do believe that that market is much stronger at the strategic level than at the broader market investment level. So we're working with Alderon and the other major shareholders to try to bring things forward. Hebe is digesting the results of the new updated feasibility study. I'm heading to China later today to meet with Hebe and others as part of a broader Eastern Canadian trade mission.
So we're focused on it, it feels like if it's going to happen, it should happen soon. That's we're putting lots of time and effort into it. But obviously, can't promise anything other than our very best effort to help do what we can.
Thank you very much.
Thank you.
There are no further questions at this time. I will now turn the call back over to Flora for closing remarks.
Okay. Thanks, Julie. And we want to thank everybody for dialing in. And we will talk to you next after your end.
This concludes today's conference call. Thank you for your participation and you may now disconnect.