OR Royalties reported preliminary third-quarter revenue of $90.2 million Wednesday, an increase of nearly 26% from the same period last year.

The Canadian mining royalty company reported approximately $87.3 million in cash margin, representing 96.8% of revenue after direct costs of sales, excluding depletion.

Those numbers highlight one of the most attractive features of the mining royalty business: remarkably low ongoing capital requirements.

Unlike traditional mining companies, OR Royalties does not operate the mines that generate its revenue.

Instead, it purchases contractual rights to receive a portion of the metals produced or revenue earned from mining operations.

The mine operators are responsible for the equipment, employees, maintenance, and capital expenditures necessary to keep production running.

OR collects its share without having to continually reinvest in those operations.

That distinction can make an enormous difference over time.

Traditional mining companies must spend substantial amounts of money simply to maintain existing production. Royalty companies can retain much more of their cash flow for acquisitions, dividends, and share repurchases.

Of course, the quality of the contracts matters. Royalty companies must invest capital upfront, and their returns depend on the performance of the underlying mines.

OR has built a portfolio of more than 200 royalties, streams, and similar interests, primarily in Canada, the United States, and Australia.

Management has also balanced shareholder returns with investments in additional royalties.

During the third quarter, the company repurchased approximately $29.1 million of its shares and invested $15 million in a new copper-related royalty.

It finished September with approximately $76.7 million in cash and $621.8 million in available revolving credit capacity.

Those resources could prove valuable as demand for gold, copper, and other metals creates opportunities for additional royalty investments.

Copper, in particular, stands to benefit from continued investment in electrical infrastructure, manufacturing, and energy production.

OR’s expansion into copper offers another potential avenue for growth beyond its established gold business.

There are risks. Commodity prices fluctuate, mines can underperform, and acquiring royalties at excessive prices can undermine future returns.

But OR’s latest results illustrate the financial advantages of a well-managed, capital-light business.

The company can participate in the growth of the mining industry without bearing most of the ongoing costs of operating the mines themselves.