Duke Royalty Limited, a leading provider of hybrid capital solutions for SME business owners in Europe and North America, has released its trading and operational update for the third quarter of the financial year ending 31 December 2023 (Q3 FY24) and provided guidance for the fourth quarter ending 31 March 2024 (Q4 FY24).
In Q3 FY24, the company achieved a record recurring revenue of £6.3 million, marking a 12% increase over Q3 FY23. The total cash revenue also stood at £6.3 million, representing over three continuous years of increasing quarterly recurring cash revenue, with a total growth of 350% from the quarter ending September 2020 to the last quarter ending December 2023.
For Q4 FY24, Duke forecasts a record total cash revenue of £10.2 million, a 30% increase over the previous record achieved in Q1 FY24. The company also completed two material and profitable buyouts during the quarter, returning over £19 million, which will be used for near-term deployments in new and existing partners. However, Duke expects a small decrease in recurring cash revenue in Q4 FY24 due to the temporary impact of reduced recurring cash revenue from the recent buyouts until the capital is redeployed.
In terms of operational updates, Duke completed a £2.9 million secondary share purchase from existing shareholders in United Glass Group, increasing its equity stake from 30% to 74%. The company also delivered two highly profitable exits from Fabrikat and Fairmed Healthcare, significantly bolstering its liquidity, which currently stands at approximately £44 million. Duke has a strong pipeline of both new and follow-on opportunities for capital partners to deploy additional liquidity.
Neil Johnson, CEO of Duke Capital, expressed delight in achieving a record quarter of total cash revenue and highlighted the value of Duke's capital through successful exits. He also mentioned the company's renewed optimism for FY25, with a strengthened liquidity position and a strong pipeline, enabling Duke to navigate the challenges and opportunities ahead while remaining cautious of the economic backdrop.
Duke Royalty Limited's unique long-term financing approach, strong liquidity position, and successful exits position the company well for future growth and value creation.