Slide 1: Corporate Presentation May 2022
Corporate Presentation May 2022
Slide 2: Important notices and disclaimer
Important notices and disclaimer This presentation has been prepared by Deterra Royalties Limited (“Deterra”, “the Company”). By accessing this presentation you acknowledge that you have read and understood the following statement. The material in this presentation is general background information
Slide 3: Corporate overview
Corporate overview Share price1 $4.43 Managing Director, CEO Julian Andrews Shares on issue 528.5m Independent Non-Executive Chair Jenny Seabrook Market capitalisation $2.3bn Non-Executive Director Graeme Devlin Cash (31 Dec 2021) $29.4m Non-Executive Director Joanne Warner 1H’22 Dividend 11.68¢ Non
Slide 4: What we offer investors
What we offer investors MAC royalty covers a world class iron ore hub, Quality Operated by BHP the world’s largest mining company1 Margins 96% EBITDA Margin2 Dividends 100% of NPAT, Fully Franked paid to date3 South Flank expected to grow MAC volumes to 145Mwmtpa 4 Growth Patient and disciplined app
Slide 5: A better way to invest in resources
A better way to “Top line” cashflows Commodity price leverage Project optionality invest in resources Royalty revenue Asset expansions Direct exposure to and extensions derived from Reduce operational exposure, asset’s revenue underlying commodity price. drive value of royalty line. capture upside i
Slide 6: Business Highlights
Business Highlights Underlying assets and business model provide a positive start to FY2022 • Strong operating performance at Mining Area C as production volumes Simple business model increase to 49.2 million wet metric tonnes, up 45% HoH performing well • Ramp-up of South Flank Project remains on t
Slide 7: Financial Results
Financial Results Simple business model continues to deliver strong financial performance
Slide 8: 1H'22 Highlights
1H’22 Highlights Strong financial performance reflecting simple business model REVENUE $92.8M EBITDA1 $88.7M 96% EBITDA MARIGN PAYOUT NPAT $61.7M 100% NPAT DIVIDENDS $61.7M 11.68¢/sh Half-Year (1) See notes on slide 2 – Non-IFRS Measures. 8
Slide 9: Simplified Income Statement
Simplified Income Statement Illustrative 1H22 statement of profit or loss AUD million Total Costs $4.3 million Net Tax Impact $26.8 million MAC $92.66 million Total Revenue $92.8 million $61.7 million 1H22 NPAT Other $0.18 million 9
Slide 10: Mining Area C Royalty Performance
Mining Area C Royalty Performance MAC reported significant increases in production volumes, up 45% on the preceding half MAC quarterly receipts and implied sales price AUD million, A$/tonne (FOB, Australia) 27.3 • BHP’s MAC operation has Revenue royalty (A$M) performed strongly with Capacity payment
Slide 11: Delivering strong shareholder returns
Delivering strong shareholder returns Continuing to build a track record of disciplined capital management and shareholder returns Dividend History AUD million Deterra’s capital management framework 60.9 61.7 • Prioritise returns to shareholders whilst Prioritise acknowledging the opportunity to inv
Slide 12: Capital structure for growth and returns
Capital structure for growth and returns The high-quality MAC cash flows and conservative capital management provides Deterra with strong capacity to fund growth and dividends Other New Royalty Cornerstone MAC Royalty Royalties Revenue New Royalty revenue = 1.232% of 5 x small investments Potential
Slide 13: Mining Area C
Mining Area C Low-risk exposure to a large, low-cost iron ore mining complex that is set to grow it’s volumes by 2.4 times1. (1) Compared to FY21 volumes. BHP reported MAC production volumes on a wet basis. Source: BHP Operational Review for the year period 31 May 2021 and similar prior Operational
Slide 14: Our core asset – the Mining Area C Royalty
Our core asset – the Mining Area C Royalty The South Flank expansion is BHP’s newest and most technically advanced operation and will make Mining Area C the world’s largest iron ore hub, producing some of the lowest cost and lowest carbon emitting iron ore in the world. Low Costs Low Emissions Large
Slide 15: Our core asset – the Mining Area C Royalty
Our core asset – the Mining Area C Royalty Low risk exposure to a long-life operation with near term growth and potential for further extension Significant near-term growth through Further resource extension potential in a low-risk jurisdiction South Flank expansion Mining Area C (MAC) royalty area2
Slide 16: Strategy and Outlook
Strategy and Outlook Maximise returns and grow value responsibly
Slide 17: Royalty and streaming company landscape
Royalty and streaming company landscape Deterra holds a leading position in the non-precious royalty streaming sub-sector Listed Royalty Companies1 Opportunity Pool of Non-Precious Focused Listed Existing Royalties2 Royalty Companies1 Total US$63bn market cap 29% of Existing Royalties Altius Mineral
Slide 18: Strategy focused on value-accretive growth
Strategy focused on value-accretive growth Deterra’s screening process and investment criteria prioritise opportunities where it has a competitive advantage Primary royalties How we prioritise opportunities Investment criteria Creating new royalties for: • Project capital Size Commodity Geography St
Slide 19: Committed to sustainable shareholder returns
Committed to sustainable shareholder returns Our sustainability roadmap outlines our commitment to transparent reporting of our ESG performance and objectives • Established Human Rights Policy Complete • Published first Corporate Governance Statement • Completed Voluntary Tax Disclosure • Developed
Slide 20: A better way to invest in the resources industry
A better way to invest in the resources industry Summary Our Business Model 1 MAC royalty is one of the world’s best royalty assets 2 Superior EBITDA margin of 96% in 1H22 3 Prioritised returns with 100% of NPAT dividend payout ratio, fully franked paid to date1 South Flank project remains on track
Slide 21: Investor and Media enquiries
Investor and Media enquiries Matthew Schembri Investor Relations Manager Mobile: + 61 (0) 427 821 380 Email: matt.schembri@deterraroyalties.com Brendan Ryan Chief Financial Officer Email: investor.relations@deterraroyalties.com Deterra Royalties Limited ACN 641 743 348 Level 5, 216 St Georges Terrac