Duke Capital Share Discussion Threads

[zangdook] 21/2/2023 07:49

In the Interims they said "Duke invested £6.6m into Intec and Tristone during Interim 2023", but all they announced was £2.3m into Tristone and £3.1m into InTec, so there's a £1.2m discrepancy there which almost corresponds to the £1.15m discrepancy you caught today.

It's odd that they don't even mention it in passing.

[carcosa] 21/2/2023 07:43

WB I think somebody else did, but not me.

I 'assume' that as with any other listed business there is no requirement to issue an RNS if it is deemed to have negligible impact on the business.

[weaverbeever] 21/2/2023 07:29

Thanks for this info. Have you ever written to the company to raise this issue?

[carcosa] 21/2/2023 07:17

RNS out today saying a further follow on of £1.75m into InTec. They go on to say the overall total in InTec is £20m which does not jive with the previous announcement total regarding InTec (unless I am mistaken) so in effect investors should note the actual increase is £2.9m.

This is not the first time DUKE have not disclosed follow-on investments. I think someone on this board noted this type of activity some months ago(?)

[carcosa] 01/2/2023 01:53

Tristone latest filing for YE Marh 2021 was made yesterday at shows cmpany in rude health (pun intended) in terms of revenue but ultimately still loss making.

There are some details regarding the DUKE loan contained therein.

Interest and tax paid is more than operational income.

Overall though a great deal of progress was made in their last FY so hopefully that will continue.

[danb45] 20/1/2023 08:17

yes and a healthy yield that looks safe

[weaverbeever] 19/1/2023 22:33

I also added. They have a lot of cash to invest now.

[danb45] 19/1/2023 10:26

Added yesterday

[shepc] 13/1/2023 15:57

7557 was a buy @ 33.00 so guess a lot of these are buys. 4 divi's @ .7 = 2.8p/yr on price of 33p I make that yield of 8.48% - love it

[masurenguy] 02/1/2023 11:55

Originally invested here @44p back in November 2018 and got out at breakeven in February 2020 as COVID started to impact the market. Have not followed since then but then this brief write-up brought it back onto my radar screen, especially since I have an investment in another royalty business, Ecora Resources, which yields me nearly 7%. At a closing offer of 34.5p on 30/12/22, the annual dividend of 2.8p now constitutes a yield of 8.1% so Duke is now back onto my watchlist.

Duke Royalty
35.75p

Duke Royalty invests cash in businesses and receives a royalty income stream in return. This is a form of financing that is suitable for cash generative businesses. Duke Royalty is in the process of investing the cash it raised in the spring. The royalty deals can last for up to 40 years and the initial yield can be 12%-14% of capital. Due diligence is done on the business to ensure that the royalties can be comfortably paid out of cash flow. The security provided by the companies limits the downside. River cruising company Temarca, which was hit by Covid restrictions, is the only investee company that has failed, and Duke Royalty managed to recoup cash from selling riverboat assets.

In the year to March 2022, cash revenues increased from £12.1m to £18.4m and free cash flow was 3.5p a share. Interim cash revenues rose by two-thirds to £10.4m with free cash flow of 1.71p a share. Third-quarter recurring cash revenues were £5.5m. The dividend is expected to increase to 2.9p a share this year and it could rise to 3.1p a share in 2023-24.

During 2022, there was £20m raised at 35p a share and the debt facility was increased from £55m to £100m in December, while the interest rate was lowered. That means that Duke Royalty has cash to invest in new and existing investee companies and that will accelerate the growth of cash revenues. It also offers a yield of more than 8%. Buy.

Andrew Hore, Interactive Investor, 30 December 2022.

[riverman77] 15/12/2022 19:18

Waterloo, I shared some of your concerns regarding the high, expensive debt and the likelihood that they would need to raise more equity - I think the recent refinancing addresses these concerns and now very happy to hold these.
Dividend cover is still a little tight, but they aim to improve this as cashflow increases more than dividends - they say they want to eventually get to a 60-80% payout ratio which will then give them a nice buffer. As long as they can get through next couple of years without one of their royalties blowing up then they should be well set for many years growth.
As this grows and establishes a track record I can see a decent re-rating, which on top of the compounding dividends should result in a very nice return.

[waterloo01] 15/12/2022 18:37

Thanks. I'll check it out. Appreciated.

[btgman] 15/12/2022 18:28

Waterloo

Watch this it covers off quite a lot your points:-



Concentrated they have exposure 14 Royalty partners and via these 56 business's geographical coverage etc

They raise money at higher than NAV and have used this to invest and increase the dividend

They have renegotiated their debt faculty at 2% less and increased available level to £100m and more than 50% of this is available.

If you get compounding dividends and also Duke compounding via exit premiums, annual adjustments and equity holdings you will see Duke is compelling investment.

AIMHO
GLA
BTG

[waterloo01] 15/12/2022 17:57

I know a lot of respected posters are in Duke so have kept it on my watch list for sometime.

These maybe misplaced, but I have two concerns that so far have stopped me from investing. One is the not so covered dividend. They regularly seem to raise cash, and some of that comes back as dividend, which, dare I say is a little ponzie like in raising money to pay off existing holders or are they now mature enough to have the earnings that back dividend cover? The second issue is the risk. They are quite concentrated and in a market downturn, will like most suffer some investment that goes wrong. What if one of their big royalty partners folds?

[cwa1] 15/12/2022 17:37

Interim Dividend and Dividend Declaration



Duke Royalty, a provider of alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and North America, is pleased to announce that the Board has approved an interim dividend of 0.70 pence (sterling) per share in respect of the third quarter of Duke's financial year, ended 31 December 2022.



The ex-dividend date is 22 December 2022, the record date is 23 December 2022 and the payment date is 12 January 2023.

[riverman77] 12/12/2022 10:45

Yes seems fair price - I guess would only be significantly dilutive if the share price got to say 60p or above, which of course would be a nice problem to have.

[carcosa] 12/12/2022 10:43

If one warrant = One share then its about 10% of the company.
Over 5 years that will roughly pay for the 225bps
However its unlikely the warrants would be converted at 45p, more like 50p and more so that represents a pretty good upside for shareholders.

Basically some financial jiggery pokery which works well for all.

IMO of course.

[poacher45] 12/12/2022 10:32

They have to pay 45p each for them which seems fair to me.

[riverman77] 12/12/2022 10:29

Any views on the warrants package? Seems quite a generous award that will be quite dilutive to shareholders.