“At the outset of the pandemic, the Royal Canadian Mint made a decision to prioritize the health and safety of employees by modifying the workplace, and adopting rigorous new health and safety protocols while continuing to deliver critical services in support of the financial and mining sectors without interruption”, said Marie Lemay, President and CEO. “Over the last several months, the Mint has continued to respond to unprecedented global bullion market conditions resulting in exceptional financial results from our Bullion Products and Services business.”
The financial results should be read in conjunction with the Royal Canadian Mint’s 2020 second quarter report. All monetary amounts are expressed in Canadian dollars, unless otherwise indicated.
Financial and Operational Highlights
- The Mint continued to serve the critical financial and mining sectors throughout the second quarter of 2020. The Mint was able to increase its revenue by 90% as a result of strong global market demand for bullion.
- Consolidated profit before income tax and other items was $1.7 million for the quarter (2019 – $8.0 million). The Mint’s profit margin was negatively impacted by the COVID-19 pandemic as incremental costs were incurred and the Mint modified production and operations for most of the second quarter to ensure the safety of its employees.
- Consolidated revenue increased to $529.5 million in the second quarter of 2020 (2019 – $278.4 million). Overall, global market demand for bullion, due to the economic uncertainty surrounding COVID-19, led to higher bullion volumes.
- Gold volumes were 196.5 thousand ounces (2019 – 84.6 thousand), while silver volumes were 7.2 million ounces (2019 – 3 million).
- Sales of numismatic products were behind 2019, having decreased $19.8 million or 62% due mainly to the modified production as a result of COVID-19 and a planned smaller, more resonant product portfolio in 2020.
- Foreign circulation revenue decreased 41% quarter over quarter with production and shipment of 192 million foreign coins and blanks, compared to 286 million coins in 2019.
- Canadian circulation coins sold to the Department of Finance were 12 million pieces in the quarter (2019 – 114 million pieces).
- Overall operating expenses decreased 3% quarter over quarter to $23.5 million.
- Cash and cash equivalents increased to $80.6 million at June 27, 2020 (December 31, 2019 – $65.5 million).
Consolidated Results and Financial Performance
(in CAD $ millions)
|13 weeks ended||26 weeks ended|
|June 27, 2020||June 29, 2019||$||%||June 27, 2020||June 29, 2019||$||%|
|Revenue||$ 529.5||$ 278.4||$ 251.1||90%||$ 1,027.9||$ 629.1||$ 398.8||63%|
|Profit before income tax and other items (1)||$ 1.7||$ 8.0||$ (6.3)||(79%)||$ 8.3||$ 19.1||$ (10.8)||(57%)|
|Profit before income tax and other items margin||0.3%||2.9%||0.8%||3.0%|
|Profit for the period||$ 7.6||$ 4.8||$ 2.8||58%||$ 9.3||$ 12.5||$ (3.2)||(26%)|
(1) A reconciliation from Profit for the period to Profit before income tax and other items is included on page 10 of the Mint’s 2020 Second Quarter Report.
|June 27, 2020||December 31, 2019||$ Change||% Change|
|Cash and cash equivalents||$ 80.6||$ 65.5||$ 15.1||23%|
|Inventories||$ 55.3||$ 94.9||$ (39.6)||(42%)|
|Capital assets||$ 165.7||$ 173.9||$ (8.2)||(5%)|
|Total assets||$ 388.2||$ 429.9||$ (41.7)||(10%)|
|Working capital||$ 115.4||$ 102.5||$ 12.9||13%|
The Mint returned to full production on May 25 after it implemented additional safety measures to allow for a higher number of employees in its production facility per shift and increased the number of shifts to accommodate the entire workforce. As part of its business continuity plan, the Mint continues to actively monitor its global supply chain and logistics networks in support of its continued operations. Despite its best efforts, the Mint expects COVID-19 to continue to affect its performance over the balance of 2020.
To read more of the Mint’s Second Quarter Report for 2020, visit the Royal Canadian Mint’s website.
Here you can find the Royal Canadian Mint’s Results for 2019 and Q1 2020.
Recently, the Royal Canadian Mint made an initial donation of $ 100,000 to the Breakfast Club of Canada. The mint will donate all net proceeds from the sale of recognition medals issued to express gratitude to someone making a difference through the COVID-19 pandemic.