Royalty Asset Enters Production as Company Highlights Path to Free Cash Flow

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1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Silver Crown Royalties Inc. (SCRI:CBOE; SLCRF:OTCQX; QS0:FSE) announced that it is now fully funded through to free cash flow, following the close of its latest financing and ongoing development at its flagship royalty asset, the PPX Igor Mine. The company described this as a fundamental shift it believes has not yet been fully recognized in the market.

"We are now, in fact, fully funded to free cash flow," said Peter Bures, CEO of Silver Crown Royalties, in a call to Streetwise Reports. "We don't have to raise one more dollar, and the market is totally missing this."

Bures noted that the October financing did not appear on most financial platforms because it was completed after the end of the quarter. "If you look at Bloomberg, Ibis, FactSet, or whatever other data provider you have, you only see the cash from the end of the quarter, which is like 400 grand," he said in a call to Streetwise Reports. "But on a net basis, because we paid for the final portion of the PPX transaction, that's what ultimately gets us to free cash flow."

Silver Crown holds a 15% net smelter return royalty on silver produced as a byproduct from PPX's Igor Mine. According to Bures, while development updates from PPX have been available publicly, awareness of the asset's significance remains limited. "PPX is not a well-known story in North America," he said. "Subsequently, because it is our most important royalty right now, nobody knows that we have this massive step function benefit coming in Q2 next year."

The company expects the PPX mill to be commissioned in Q1 2026, with full production anticipated by Q2. "That's exactly what we're expecting. That's what they're expecting," Bures said, referencing PPX's public timeline.

Silver Crown projects annual silver deliveries from the PPX royalty between 56,000 and 112,500 ounces, with total life-of-mine deliveries exceeding 200,000 ounces. The royalty was acquired for an upfront US$2.5 million, with an additional US$2.5 million bonus tied to a doubling of deliverable ounces.

"We're trading as if we need more capital," Bures added. "But that's just not true — we're fully funded, and the market hasn't caught up yet."

The company currently holds five royalties, including two producing assets, two in near-term development, and one restart-stage opportunity. Silver Crown reports that its portfolio carries a net present value of approximately US$56 million, with an internal rate of return in excess of 25%.

Bures said the latest financing round closed at CA$5.50 per unit and included three-year warrants exercisable at CA$8.25. "We're not issuing equity below CA$10," he emphasized. "It would be tremendously disingenuous of me to go around and say the stock is cheap, and then turn around and issue equity."

The company continues to pursue royalty acquisitions through both cash deals and equity-for-silver swaps, often structured at a premium. "We go to an operator and say, we'll take your silver, you take our equity," Bures said. "We priced equity at CA$10 when the stock was trading at CA$7."

He also noted personal alignment with shareholders. "I've just only ever been a consistent buyer," Bures said, referencing his ongoing open-market purchases.

Silver Market Dynamics and Industrial Demand

A December 10 report from Leede Financial highlighted a more than tenfold increase in global photovoltaic (PV) capacity over the last decade, with China accounting for 51% of that growth. The report noted that silver demand from PVs rose faster than from other industrial sectors, expanding from 11% of total industrial silver use in 2014 to 29% in 2024. Despite the scale of growth, silver demand rose only threefold due to efficiency improvements that reduced the amount of silver needed per solar cell.

Peter Krauth, in a sector commentary published the same day, reported that silver had passed US$60 per ounce for the first time, calling it "another milestone record high." He noted that the move came just weeks after silver exceeded US$50, citing tightening supply conditions and five consecutive years of global deficits. Krauth also emphasized robust industrial demand and noted that China had been "quietly absorbing physical metal."

Tim Wright of Couloir Capital maintained a Buy rating on Silver Crown Royalties Inc. and assigned a 24-month price target of CA$44.40 per share.

The BBC reported on the same day that silver's jump to US$60 per ounce coincided with expectations of an upcoming interest rate cut by the U.S. Federal Reserve.

The article noted that falling rates and a weaker dollar tend to drive investors toward precious metals. Yeow Hwee Chua of Nanyang Technological University commented that rate cuts "naturally shift demand toward assets viewed as stores of value, including silver."

Additional context from analysts pointed to the growing use of silver in electric vehicles and solar technology. Kosmas Marinakis of Singapore Management University said silver is "not only an investment asset but also a physical resource," adding that more manufacturers are incorporating it into their processes.

The report also highlighted that silver production remains constrained due to its status as a by-product of other mining operations, making it difficult to scale supply quickly.

Analysis Supports Valuation and Growth Strategy

On October 17, Tim Wright of Couloir Capital maintained a Buy rating on Silver Crown Royalties Inc. and assigned a 24-month price target of CA$44.40 per share. At the time of the report, the firm noted a current market price of CA$6.10, implying a projected upside of 628 percent. According to Wright, "Silver Crown Royalties is the only pure-play silver royalty company in the market offering investors access to a diversified portfolio of silver royalties."

Wright emphasized the company's consistent performance, stating that it had averaged "over 30% quarter on quarter growth in both royalty silver ounces and revenue" since inception. He also noted that Silver Crown Royalties was "well on its way to becoming cash flow positive in the next 6–12 months." The report described the firm's investment approach as staged and structured to minimize risk, with capital deployed in tranches upon reaching defined milestones. This model, combined with technical expertise and a broad industry network, was presented as a key differentiator.

In the valuation section, Couloir Capital compared Silver Crown's enterprise value to equity raised ratio of 1.27 against a peer group average of 11.57, stating that it adjusted this peer group average down to 9.25 to account for structural differences. Applying the ratio of 1.27, the report reiterated the upside estimate and supported the CA$44.40 target. Wright concluded that the company's ability to grow its royalty portfolio while maintaining capital efficiency placed it in a favorable position as investor awareness and silver demand increased.

Cash Flow Visibility Strengthens Silver Crown's Revaluation Case

Silver Crown's near-term catalysts focus on the PPX mill entering production in early 2026. The company has projected free cash flow of CA$3 to CA$4 million that year, assuming silver prices between US$50 and US$60 per ounce. Based on the current share count, CA$4 million in free cash flow would translate to over CA$1.00 per share.

In its Q4 2025 investor presentation, Silver Crown underscored what it sees as a disconnect between its valuation and that of its peers. While junior royalty companies with market capitalizations under US$1 billion have historically traded at over 40x sales, Silver Crown currently trades at about 20x sales. Management noted that it had historically traded between 12x and 25x trailing sales and suggested that expected revenue from PPX could support a step change in valuation.

The company's five royalty assets include the PGDM operation in Brazil, which carries a 90% silver NSR and a minimum delivery of 16,000 ounces annually, and the BacTech project in Ecuador, which features a similar royalty structure. Several agreements include milestone bonuses tied to development or commercial production. Total deliveries across the portfolio are expected to exceed 22,000 silver-equivalent ounces in 2025 and rise to nearly 62,000 ounces in 2026 based on internal projections.

Silver Crown said it plans to continue expanding its portfolio through both traditional cash transactions and premium-priced equity swaps. Management also pointed to insider alignment as a key differentiator, with over 20,000 shares acquired in the open market since the IPO.

Ownership and Share Structure ¹

Insiders and management, including their friends and family, hold a total of 28% of the company. Institutions own 14%, and private corporations have 9%, according to the company's investor presentation.

As for share structure, Silver Crown has approximately 3.81 million outstanding shares and a free float of about 3.38 million shares. Its market capitalization is around CA$23.2 million. Its 52‑week trading range is CA$5.27 to CA$7.83 per share.