SRR:CC - SOURCE ROCK ROYALTIES DECLARES QUARTERLY DIVIDEND

Canada NewsWire

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CALGARY, AB , March 15, 2022 /CNW/ - Source Rock Royalties Ltd. ("Source Rock")(TSXV: SRR)(TSXV: SRR.WT), a pure play oil and gas royalty company with an established portfolio of light oil focused royalties in Saskatchewan and Alberta , announces that its board of directors has declared a quarterly dividend of $0.015 per common share, payable in cash on April 14, 2022 to shareholders of record on March 31, 2022 . This dividend is designated as an "eligible dividend" for Canadian income tax purposes.

Brad Docherty , Chairman, President & CEO of Source Rock, said: " We are pleased to declare our inaugural dividend as a publicly listed company. We previously paid a $0.015 per share dividend for 25 consecutive quarters from Q1 2014 to Q1 2020 and then again for each quarter in 2021. In total, we returned $10.2 million to shareholders as a private company prior to completing our listing on the TSX Venture Exchange. We will continue to strive to execute on a balanced growth and yield business model with a target payout ratio ¹ for our dividend of 50% to 70% of funds from operations ² on an annualized basis. "

About Source Rock Royalties Ltd.

Source Rock is a pure-play oil and gas royalty company with an existing, light oil focused portfolio of royalty interests concentrated in southeast Saskatchewan , east-central Alberta , west-central Alberta and west-central Saskatchewan . Source Rock targets a balanced growth and yield business model, using funds from operations to pursue accretive royalty acquisitions and to pay dividends. By leveraging its niche industry relationships, Source Rock identifies and acquires both existing royalty interests and newly created royalties through collaboration with industry partners. Source Rock's strategy is premised on maintaining a low-cost corporate structure and achieving a sustainable and scalable business, measured by growing funds from operations per share and maintaining a strong netback on its royalty production.

Forward-Looking Statements

This news release includes forward-looking statements and forward-looking information within the meaning of Canadian securities laws. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "is expected", "expects", "scheduled", "intends", "contemplates", "anticipates", "targets", "believes", "proposes" or variations (including negative and grammatical variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements in this news release include statements regarding future amounts of dividend payments and Source Rock's growth strategy and expectations with respect to future opportunities. Such statements and information are based on the current expectations of Source Rock's management and are based on assumptions and subject to risks and uncertainties. Although Source Rock's management believes that the assumptions underlying these statements and information are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this news release may not occur by certain dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting Source Rock, including the risk factors set forth in Source Rock's final prospectus dated February 23, 2022 under the heading "Risk Factors". Although Source Rock has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements and information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement or information can be guaranteed. Except as required by applicable securities laws, forward-looking statements and information speak only as of the date on which they are made and Source Rock undertakes no obligation to publicly update or revise any forward-looking statement or information, whether as a result of new information, future events or otherwise.

Non-GAAP Measures

This news release uses the term "funds from operations" which is a non-GAAP financial measure and the term "payout ratio" which is a non-GAAP ratio. These financial measures and ratios do not have a standardized prescribed meaning under GAAP and these measures and ratios may not be comparable with the calculation of similar measures disclosed by other entities.

The most directly comparable GAAP financial measure to funds from operations is cash flow from operating activities. "Funds from operations" is defined as cash flow from operating activities before the change in non-cash working capital. Source Rock believes the timing of collection, payment or incurrence of these non-cash items involves a high degree of discretion and as such may not be useful for evaluating Source Rock's operating performance. Source Rock considers funds from operations to be a key measure of operating performance as it demonstrates Source Rock's ability to generate funds to fund operations, acquisition opportunities, dividend payments and debt repayments, if applicable. Funds from operations should not be construed as an alternative to income or cash flow from operating activities determined in accordance with GAAP as an indication of Source Rock's performance.

"Payout ratio" is calculated as the aggregate of cash dividends paid in a period divided by funds from operations realized in such period. Source Rock considers payout ratio to be a key measure to assess Source Rock's ability to fund operations, acquisition opportunities, dividend payments, cash taxes and debt repayments, if applicable.

Notes

(1)  This is a non-GAAP financial measure or non-GAAP ratio. Refer to the disclosure under the heading "Non-GAAP Measures" for more information on each non-GAAP financial measure or ratio.
(2)  This is a non-GAAP financial measure or non-GAAP ratio. Refer to the disclosure under the heading "Non-GAAP Measures" for more information on each non-GAAP financial measure or ratio.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy of this release.

SOURCE Source Rock Royalties Ltd.

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