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 2018 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. 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 investor 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. The room we're in isn't in St. John's this time. Just to tell you, we're in Toronto this time. 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&A. 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. Altius generated CAD 17.1 million in royalty revenue during the quarter, compared to CAD 16.5 million in Q2 and CAD 17.9 million 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 CAD 13.9 million or CAD 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 CAD 0.14 during the third quarter, compared to CAD 0.12 in Q2 and CAD 0.16 in the comparable period last year. Our Q3 earnings included a couple of non-cash items, the largest of which was dilution gains and earnings from associates, which had a positive impact of about CAD 2 million or a little under CAD 0.05 per share.
General and administrative expenses of CAD 1.9 million are up approximately CAD 200,000 from the same period last year, similar to Q2 levels of approximately CAD 2 million. The year-over-year increase in G&A was driven by corporate development and legal services activities. Income taxes of approximately CAD 1.5 million are slightly higher than the Q2 CAD 1.1 million comparable number as a result of higher income.
We ended the quarter with CAD 33.8 million in cash and cash equivalents. We put some of our surplus cash to work during the quarter, using CAD 8.7 million to buy additional Labrador Iron Ore Royalty Corporation shares, and we made another investment of CAD 2 million through our rights to co-invest alongside Lithium Royalty Corporation. Other uses of cash during the quarter included a scheduled CAD 5 million payment on our term debt, CAD 1.25 million preferred share distribution, as well as our regular quarterly cash dividend of CAD 0.04 per share.
Finally, we were active on our share buyback, spending CAD 2.6 million during the quarter to acquire 212,300 Altius shares, which have been returned to treasury. Total cash and market investments at the end of Q3 were approximately CAD 175 million. I'll remind you that we have an unused revolving credit facility of CAD 100 million. Thus, we have ample liquidity to pursue opportunities as they arise. In summary, Altius had another great quarter with solid cash flow from our diversified royalty business. Net earnings came in as expected, we continued our balanced approach to capital allocation during the quarter. Now I'll turn it over to Brian.
Thank you, Ben. Good morning, 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, revenue from triple seven 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 Sheerness has moved on to lower-paying royalty lands as part of its normal mine sequencing.
We continued with preparations to initiate legal action to seek compensation for governmental policy changes that will cause our thermal coal royalty revenue to end by 2030, 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 on strong global demand growth, while Rocanville 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, Yamana has increased its full-year copper production guidance to 125 million lbs from 120 million 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. IOC was largely able to return to a normal production volume range following the strike in Q2. 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 to its more typical focus on delivering a high dividend payout ratio.
Bear with me. Metallurgical coal revenue from Teck's 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 include it 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 non-payment.
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 believed 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 the newly approved underground development plans 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 lands 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, the 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 CAD 5 million. We do intend to exercise this option and look forward to Gunnison becoming our 16th 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 Telkwa Metallurgical Coal Project in British Columbia. It announced that Japan's Itochu has joined it as a joint venture financing partner and product marketer.
An updated feasibility study is expected early in the new year. The permitting process has begun. Telkwa came to us as part of our acquisition of royalties and lands from Sherritt a few years back. We then vended it to Allegiance for a significant equity stake and 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 CAD 68 million at quarter end from CAD 44 million at the end of the last quarter, despite a relatively weak period in the market for junior exploration companies. Adventus continued to report excellent infill drilling results from its polymetallic Curipamba 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 2019. It is now turning its attention to testing several exploration targets that offer the potential for the discovery of additional satellite deposits. Adventus 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.
Evrim has begun a first-ever drilling program at its Cuale 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 had reached an agreement with First Majestic that will see it hold a royalty on the resource delineation stage Ermitaño project.
We are a large shareholder of Evrim and hold a royalty on the Cuale project. Sokoman has reported high-grade drilling results from the Moosehead Gold Project in Newfoundland and has raised significant equity through a placement led by well-known investor Eric Sprott. Our planned diamond spinout, 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 Lynx 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. We'll turn back to the operator for the Q&A.
At this time, I would like to remind everyone, in order to ask a question, please press star then the number one on your telephone keypad. Again, that's star and then the number one. Your first question comes from Carey MacRury with Canaccord Genuity. Please go ahead, your line is open.
Good morning, guys.
Hey, Carey. Good morning.
Question on Voisey's. I know the royalty is effective back to April 1st. I'm 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 30th. We will catch up at some point. That was part of the settlement. That's been delivered. We should have a catch-up period where we will have two quarters recognized in revenue. The next payment is actually November 15th. It will follow thereafter.
The two quarters, would you expect that in Q4 or Q3?
Probably Q4. It really depends on what information we get from Vale as well, and just to make sure we can do an accurate estimate.
Secondly, on the Lithium Royalty Corporation, you've got CAD 8 million invested there for a 10% stake. That's pretty sizable. I'm just wondering if you could 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?
Yeah. It's Brian here, Carey. The CAD 8 million isn't entirely for the co-participation, right? It also includes direct investment at the equity level in LRC. LRC, right now its focus has mainly been on development stage projects. The market has actually been pretty good if you're a buyer in that space. It hasn't been a fantastic year for lithium prices, and that's created good opportunities. We're pretty encouraged about the quality of the projects that 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. It's a pretty busy time and lots of strategic files open there.
Are these all over the globe or is there more of a focus on-
Global search.
Yeah. Okay. Maybe one last question on the hydroelectric opportunity that you're pursuing in terms of royalties. Any progress on that front?
Yeah. 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. 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. We are finding good opportunity at the development stage, and we feel we're pretty close to securing our first batch of royalties there.
Is there still an opportunity to kind of roll the coal assets into that or is that?
Yeah
Not really?
I don't think we'll actually roll the coal assets in. The idea there, the concept we're running with is to reinvest an equivalent amount of royalty revenue from the coal portfolio into renewable assets. 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, then essentially turn them into perpetual royalties. It's less of a formal linkage, that's the investment rationale and sort of how we're thinking about it when we plan our broader 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.
Good morning, guys. Your decision to increase your position in LIF is kind of interesting, as you have disclosed publicly that you oppose any change in mandate to amend business restrictions. Although they haven't closed the door on that at LIF, 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 we're premium strong, but there are steady operational improvements at that asset. At a 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 on the balance 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 just 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 royalty interest is essentially, 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. Once there are extra corporate factors involved there, our motivation would decrease. We're very happy with that decision.
Okay. Thanks a lot, Brian. Good quarter.
Thank you.
Thank you.
Again, if you would like to ask a question, please press star then one on your touchtone phone. Your next question comes from Joseph Levatino with Jalaspen . Please go ahead. Your line is open.
Yeah, good morning. This question concerns the 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 a go decision or a financing for the Kami project. We 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 that Rio Tinto is looking to sell its stake. That's obviously bringing lots of attention from strategic investors towards the Trough, whatever marketing and efforts that they've been doing is 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.
A lot of really positive things going on in the Labrador Trough right now, and the Kami 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, when 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, the gap there is pretty wide. We do believe that that market is much stronger at the strategic level than at the broader market investment level. We're working with Alderon and the other major shareholders to try to bring things forward. Hebei is digesting the results of the new updated feasibility study. I'm heading to China later today to meet with Hebei and others as part of a broader Eastern Canadian trade mission. We're focused on it. It feels like if it's going to happen, it should happen soon. We're putting lots of time and effort into it. Obviously, I 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 year-end.
This concludes today's conference call. Thank you for your participation. You may now disconnect.