Queen's Road Capital Investment Ltd. · TSX:QRC
Queen's Road Capital Investment — Investor Presentation (May 2020)
17 slides from Queen's Road Capital Investment's investor presentation, May 2020
Slide 1: Queen's Road Capital Investment Ltd. – Leading Financier to the Global Resource Sector
QUEEN’S ROAD CAPITAL INVESTMENT LTD. (TSXV: QRC) Leading Financier to the Global Resource Sector May 2020
Slide 2: Cautionary Statement
Cautionary Statement IMPORTANT: PLEASE READ THE FOLLOWING BEFORE CONTINUING. The information contained in this document has been prepared by QUEEN’S ROAD CAPITAL INVESTMENT LTD. (“QRC” or the “Company”). The information contained in this document (a) is provided as at the date hereof and is subject
Slide 3: Queen's Road Capital (QRC)
Queen’s Road Capital (QRC) • QRC is a leading source of investment capital to resource companies and projects throughout the world • QRC focuses on investment structures which, where possible, limit downside and retain upside • Preference for convertible debenture structures • Income during life of
Slide 4: Queen's Road Capital (QRC)
Queen’s Road Capital (QRC) • QRC is managed by Warren Gilman and Alex Granger who have over 60 years of deal making and financing in the global resource sector • Directors & Officers own >9% of QRC which was acquired entirely through share purchases at an average cost of $0.35 per share • QRC’s gene
Slide 5: QRC Leadership Team
QRC Leadership Team Hong Kong Directors Overseas Directors Warren Gilman – Chairman & CEO John Anderson – Independent Director • CEO of Queen’s Road Capital Investment Ltd. • Practicing lawyer at Stikeman Elliott since • Mining engineer 1991 with a focus on public M&A • 26 years at CIBC running mini
Slide 6: Warren Gilman – CEF Track Record
Warren Gilman – CEF Track Record • Warren Gilman left CIBC in 2011 with the title of Vice Chairman & Head of Asia Pacific, responsible for all CIBC business activities in Asia • Joined CEF in 2011 & led it for the next 8 years until its closure in 2019 • CEF was owned 50% by CIBC & 50% by CK Hutchis
Slide 7: QRC Capital Structure
QRC Capital Structure • QRC is a tightly held company with 75% of the shares in the hands of three strategic investors as well as Directors & Officers. Float Basic Shares Outstanding: 277,252,651 14% Corom Pty Ltd (Jack Cowin) 26% Options Outstanding 02/25 Expiry ($0.30) 11,000,000 Australasia High
Slide 8: QRC Capital Structure
QRC Capital Structure Jack Cowin – Corom Pty Ltd. Andrew Forrest– Squadron Resources Pty Ltd. • Corom Pty Ltd. is an investment vehicle owned and • Squadron Resources Pty Ltd. is an investment vehicle controlled by Mr. Jack Cowin, a Canadian-Australian owned and controlled by Mr. Andrew Forrest, an
Slide 9: QRC Share Price Performance
QRC Share Price Performance $0.90 600,000 $0.80 500,000 $0.70 Shares halted; Announcement of $0.60 transformation from Lithion 400,000 Energy to Queen’s Road Capital $0.50 300,000 $0.40 $84 million capital raising; Halt Lifted $0.30 200,000 Announcement of US$30m $0.20 NexGen Investment (TSX: NXE) 1
Slide 10: QRC Investment Structure
QRC Investment Structure Capital Investments Injections Investors QRC Investee (Cayman Islands) Companies (TSXV: QRC) Regular Interest Dividends & Caymans Payment Special incorporation & Hong on Converts & Dividends Kong residency Establishment supports tax Fees efficiency of investment returns
Slide 11: Why Focus on Converts?
Why Focus on Converts? Convert Royalty / Mining / Co Streaming Exploration Co Co Leverage to Commodity Prices ✘ ✘ ✘ Diverse Asset Base ✘ ✘ No Capital / Operating Cost Exposure ✘ ✘ Sustainable Dividend ✘ ✘ Low Overhead / G&A Cost Model ✘ ✘ Income Regardless of Production ✘ Upside from Underlying Equi
Slide 12: The Convert Model
The Convert Model • Investments in convertible 100% Equity Investment debentures offer: • Downside protected as debt Underlying Equity Share Price structure ranks ahead of 50/50 Equity / Convert shareholders • Full equity upside above the conversion price • Income regardless of macro / Downside 100%
Slide 13: Investment in NexGen Energy Ltd.
Investment in NexGen Energy Ltd. • On May 11, 2020, QRC announced a US$30 million investment in NexGen Energy Ltd. (TSX: NXE), comprised of US$15 million in equity and US$15 million in convertible debentures with a 7.5% annual coupon • NexGen owns and operates the Arrow uranium deposit located in Sa
Slide 14: Investment in NexGen Energy Ltd.
Investment in NexGen Energy Ltd. • Key Terms of the Investment: • Purchase of 11,611,667 shares in NXE at C$1.80 per share for proceeds of US$15,000,000 • Purchase of US$15,000,000 aggregate principal amount of 7.5% unsecured convertible debentures • 7.5% interest payable semi-annually • 5.0% payabl
Slide 15: QRC Investment Portfolio
QRC Investment Portfolio Current Portfolio Indicative Long-Term Portfolio NAV Distribution NAV Distribution 33% Equity Linked 35% Equity Linked Cash NXE - Equity Portion 5% Conversion of Convert Option Investments 9% 25% NXE - Equity Cash 24% 44% Equity Investments 10% Debt Portion of NXE - Debt Con
Slide 16: QRC Investment Portfolio
QRC Investment Portfolio • Illustrative Cash Flow based on $100 million investment base Investment Portfolio Shareholder Return Item Weight Return Regular Dividend $4.5 million Special Dividend tbd Convertible Securities 85% 7.5% pa Equity Investments 10% nil Dividend Yield 4.5% Cash 5% 0.5% pa (on
Slide 17: Thank You!
QUEEN’S ROAD CAPITAL INVESTMENT LTD. (TSXV: QRC) Thank You!
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