Royal Canadian Mint Reports Profits and Performance for 2020
OTTAWA, ON, April 30, 2021 /PRNewswire/ -- The Royal Canadian Mint (the "Mint") is pleased to announce its financial results for 2020 that provide insight into our activities, the markets influencing our businesses and our expectations for the next 12 months.
"In 2020, employees of the Royal Canadian Mint demonstrated their ability to innovate and deliver great products in a very challenging operating environment" said Marie Lemay, President and CEO of the Royal Canadian Mint. "Their hard work contributed to the Mint's success. Employees pivoted quickly in the face of disruption allowing the Mint to generate strong profits."
"The Mint continues to respond to the unprecedented situation with COVID-19 in a proactive way that prioritizes the health and safety of our employees. We have adapted our production to be able to continue delivering critical services in support of the essential mining and financial sectors, while adhering to strict new protocols to ensure our work environment is a safe one."
"One very special initiative in 2020 was our Recognition Medal, created to recognize frontline workers while raising money for the Breakfast Club of Canada's COVID-19 Emergency Fund. Employees donated their time to this project and thanks to their generosity and the contrinutions of thousands of Canadians, the Mint was able to make a $400,000 donation to the Breakfast Club in 2020."
The financial results should be read in conjunction with the Mint's annual report available at www.mint.ca. All monetary amounts are expressed in Canadian dollars, unless otherwise indicated.
Financial and Operational Highlights
- The Mint increased its revenue by 74% in 2020 as a result of exceptionally strong global market demand for bullion while consolidated profit before income tax and other items was $27.5 million for the year (2019 – $42.3 million). Higher bullion volumes sold in 2020 increased the Mint's revenue and cost of sales proportionately; however, the Mint's profit margin was impacted in 2020 by lower revenue from its other businesses, without a corresponding decrease in costs. In particular, the Mint continued to pay its employees and did not reduce any fixed costs during the periods of suspended or modified production as a result of the pandemic impacting the Mint's profit margin in 2020 by approximately $6 million.
- Consolidated revenue increased to $2,527.6 million in 2020 (2019 - $1,453.4 million).
- Gold bullion volumes increased more than 100% year over year and were 982.8 thousand ounces (2019 – 483.0 thousand ounces) while silver bullion volumes were 29.5 million ounces (2019 – 22.8 million ounces).
- Sales of numismatic products decreased to $91.9 million in 2020 (2019 - $116.8 million) due mainly to the temporary suspension of numismatic product production as a result of COVID-19 in 2020.
- Revenue from the Foreign Circulation business decreased 2% to $64.2 million (2019 - $65.4 million) with production and/or shipments of 838 million coins in 2020 and blanks compared to 1,308 million coins and blanks in 2019.
- Canadian circulation coins produced and sold to the Department of Finance for inventory were 229 million pieces in 2020 (2019 – 385 million pieces) while coins sold to financial institutions to meet demand decreased 8% year over year.
- Operating expenses, overall, increased 4% year over year to $98.5 million (2019 – $94.5 million) as the Mint focused on enhanced organizational resiliency in 2020 and the development of its updated long-term strategic vision and the strategy for the Mint's future business transformation.
- Cash and cash equivalents increased to $67.3 million (December 31, 2019 - $65.5 million) after the Mint declared and paid a $20 million dividend to its Shareholder, the Government of Canada, in 2020. Cash and cash equivalents remain at the level required to support the Mint's operations.
Consolidated results and financial performance
(in CAD $ millions for the years ended December 31, 2020 and 2019)
Year ended |
|||||||
December 31, |
December 31, |
$ |
% |
||||
Revenue |
$ |
2,527.6 |
$ |
1,453.4 |
$ |
1,074.2 |
74 |
Profit before income tax and other items1 |
$ |
27.5 |
$ |
42.3 |
$ |
(14.8) |
(35) |
Profit before income tax and other items margin |
1.1% |
2.9% |
|||||
Profit for the period |
$ |
37.7 |
$ |
34.8 |
|||
(1) A reconciliation from profit for the period to profit before income tax and other items is included on page 35 of the Mint's 2020 |
|||||||
As at |
|||||||
December 31, 2020 |
December 31, 2019 |
$ Change |
% Change |
||||
Cash and cash equivalents |
$ |
67.3 |
$ |
65.5 |
$ |
1.8 |
3 |
Inventories |
$ |
57.6 |
$ |
94.9 |
$ |
(37.3) |
(39) |
Capital assets |
$ |
161.1 |
$ |
173.9 |
$ |
(12.8) |
(7) |
Total assets |
$ |
379.4 |
$ |
429.9 |
$ |
(50.5) |
(12) |
Working capital |
$ |
112.9 |
$ |
102.5 |
$ |
10.4 |
10 |
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 in 2021.
To read more of the Mint's annual report for 2020, please visit www.mint.ca.
About the Royal Canadian Mint
The Royal Canadian Mint is the Crown corporation responsible for the minting and distribution of Canada's circulation coins. The Mint is recognized as one of the largest and most versatile mints in the world, offering a wide range of specialized, high-quality coinage products and related services on an international scale. For more information on the Mint, its products and services, visit www.mint.ca. Follow the Mint on Twitter, Facebook and Instagram.
FORWARD LOOKING STATEMENTS
This Earnings Release contains forward-looking statements that reflect management's expectations regarding the Mint's objectives, plans, strategies, future growth, results of operations, performance, and business prospects and opportunities. Forward-looking statements are typically identified by words or phrases such as "plans", "anticipates", "expects", "believes", "estimates", "intends", and other similar expressions. These forward-looking statements are not facts, but only estimates regarding expected growth, results of operations, performance, business prospects and opportunities (assumptions). While management considers these assumptions to be reasonable based on available information, they may prove to be incorrect. These estimates of future results are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from what the Mint expects. These risks, uncertainties and other factors include, but are not limited to, those risks and uncertainties set forth in the Risks to Performance section of the Management Discussion and Analysit in the Mint's 2020 annual report, as well as in Note 9 – Financial Instruments and Financial Risk Management to the Mint's Audited Consolidated Financial Statements for the year ended December 31, 2020. The forward-looking statements included in this Earnings Release are made only as of April 30, 2021, and the Mint does not undertake to publicly update these statements to reflect new information, future events or changes in circumstances or for any other reason after this date.
Alex Reeves, Senior Manager, Public Affairs, Tel: (613) 884-6370, [email protected]
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