Franco-nevada Corporation · TSX:FNV
Franco-nevada — Investor Presentation (April 2024)
33 slides from Franco-nevada's investor presentation, April 2024
Slide 1: Corporate Presentation April 2024
2 0 2 4 C O R P O R A T E P R E S E N T A T I O N A P R I L
Slide 2: Cautionary Statement: Forward-Looking Statements
CAUTIONARY STATEMENT 2 Forward-Looking Statements This presentation contains “forward-looking information” and “forward-looking statements” within the meaning of applicable Canadian securities laws and the United States Private Securities Litigation Reform Act of 1995, respectively, which may includ
Slide 3: The Gold Investment That Works
THE GOLD INVESTMENT THAT WORKS 3 Proven Business Model 15% Compounded Return Since IPO1 Leading Track Record 17 Consecutive Dividend Increases ESG Focused #1 Ranked by Sustainalytics Diversified Portfolio 118 Cash Flowing Assets Growth and Optionality $2.4B Available Capital 1. Compounded annual tot
Slide 4: Business Model Advantages
BUSINESS MODEL ADVANTAGES 4 B U S I N E S S M O D E L UPSIDE POTENTIAL LOW RISK Optionality Diversified Portfolio Potential for exploration success on ~67,400 km2 (1) Non-operating business is more scalable Focus on Growth High Margins & Low Overhead Management not occupied with operational decision
Slide 5: Financing Successful Mines
FINANCING SUCCESSFUL MINES 5 B U S I N E S S M O D E L DEBT EMERGING PROJECT M&A REDUCTION PROJECTS DEVELOPMENT Alignment with partners for a win-win solution
Slide 6: Why Is Franco-Nevada Different?
WHY IS FRANCO-NEVADA DIFFERENT? 6 B U S I N E S S M O D E L Shareholder Alignment Committed to high share ownership and treating shareholder funds as our own (low G&A) Financial Flexibility Avoiding long-term debt and paying progressive and sustainable dividends ensuring capital availability at all
Slide 7: Shareholder Returns
SHAREHOLDER RETURNS 7 L E A D I N G T R A C K R E C O R D Franco-Nevada (FNV) - US$ basis NASDAQ S&P 500 Gold Bullion ETF Barclays US Aggregate Bond GDX (index of mostly gold miners) -4% 0% 4% 8% 12% 16% Lower-risk gold investment to hedge against market volatility 1. FNV Inception – December 20, 20
Slide 8: Leading Track Record
LEADING TRACK RECORD 8 L E A D I N G T R A C K R E C O R D GEOs1 Revenue Operating Cash Flow (000’s) (US$ Millions) (US$ Millions) 800 1,400 1,200 700 1,200 1,000 600 1,000 800 500 800 400 600 600 300 400 200 400 200 200 100 - - - '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '23 '08 '
Slide 9: Scalable High Margin Business Model
SCALABLE HIGH MARGIN BUSINESS MODEL 9 L E A D I N G T R A C K R E C O R D G&A $28.9M G&A $15.3M 2008 2023 Revenue $150.6M Revenue $1,219.0M G&A 2.4% of Revenue and only 13 Basis Points of Market Cap.1 1. Market Capitalization as at December 31, 2023
Slide 10: Progressive & Sustainable Dividends
PROGRESSIVE & SUSTAINABLE DIVIDENDS 10 L E A D I N G T R A C K R E C O R D 17 CONSECUTIVE INCREASES $280 $2,100 Quarterly Dividend $260 $1,950 US$0.36/share1 $240 $1,800 Dividends Paid US $ (Millions) per annum $220 $1,650 Dividend paid since IPO2 Average Gold Price US $ $200 $1,500 >$2.2B3 $180 $1,
Slide 11: Highly Profitable
HIGHLY PROFITABLE 11 L E A D I N G T R A C K R E C O R D 56% 2023 Adjusted Net Income Margin1,2 2023 $0 US $ (Millions) $200 $400 $600 $800 $1,000 $1,200 $1,400 83% 2023 Adjusted EBITDA Margin1,2 G&A Cost of Sales Depletion Taxes/Other Adjusted Net Income 1. Please see notes on appendix slides – GEO
Slide 12: Top Level ESG Ratings & Recognition
TOP LEVEL ESG RATINGS & RECOGNITION 12 E S G F O C U S E D Top Rated Gold and Precious Metals Company by Sustainalytics* * Sustainalytics rating in 2024 The use by Franco-Nevada Corporation of any MSCI ESG Research LLC or its affiliates (“MSCI”) data, and the use of MSCI logos, trademarks, service m
Slide 13: ESG Leadership
ESG LEADERSHIP 13 E S G F O C U S E D Responsible Capital Good Governance & Community Contributions Allocation Shareholder Alignment Allocating capital to responsible operators Engaging with our operators to partner Governing responsibly to ensure integrity in our that provide safe workplaces for th
Slide 14: ESG Leadership (cont.)
ESG LEADERSHIP (cont.) 14 E S G F O C U S E D Fostering Diversity, Inclusion & Well-Being Climate Action Transparent ESG Disclosure Maintaining a safe and supportive Aiming to achieve net-zero GHG emissions by Providing transparency in all ESG matters relating environment for our team, removing barr
Slide 15: Assets
431 ASSETS Covering OUR Approximately PORTFOLIO ~67,400 km2 431 TOTAL 118 Precious Metals Diversified PRODUCING 41 Precious Metals Diversified ADVANCED 272 EXPLORATION Not all assets shown on map, including exploration assets Asset count as of April 15, 2024 Cobre Panama currently on preservation an
Slide 16: Return on Investment
RETURN ON INVESTMENT 16 D I V E R S I F I E D P O R T F O L I O Candelaria Investment (2014) Return Antapaccay Investment (2016) Return Antamina Investment (2015) Return Va l e Investment (2021) Return Weyburn Investment (2012) Return $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 US$ (Millions)
Slide 17: Cobre Panama Update
COBRE PANAMA UPDATE 17 D I V E R S I F I E D P O R T F O L I O o Law 406 found to be unconstitutional (November 2023)1 o Mine on preservation and safe management o Franco-Nevada notice of intent to arbitrate2 o $1,169.2 impairment recorded in 2023 o Panamanian election May 5, 2024 1. Law 406 approve
Slide 18: Haynesville Royalty Acquisition
HAYNESVILLE ROYALT Y ACQUISITION 18 D I V E R S I F I E D P O R T F O L I O $125M Acquisition • ~1,400 net acres1 of royalties in Haynesville shale • Acquired from Mesa Minerals Partners II, LLC • Effective date: Jan 1, 2024 • Royalties generated ~6,500 Mmcf2 of gas in 2023 Complementary Asset • Acr
Slide 19: 2024 GEOs Diversification
2024 GEOs DIVERSIFICATION 1 19 D I V E R S I F I E D P O R T F O L I O Gas Rest of World Candelaria Oil NGL Central America & Canada Mexico & USA Other Antapaccay Other Mining PGM Antamina Gold Silver Guadalupe- Palmarejo Vale South America Energy COMMODITY GEOGRAPHY ASSETS 75% from 85% from America
Slide 20: Guidance
GUIDANCE 20 G R O W T H A N D O P T I O N A L I T Y GEOs 2024 Guidance1 2028 Outlook1 GEOs 480,000-540,000 540,000-600,000 Total Total – Assumes lower oil and gas prices1 + Vale Northern and Southeastern Systems + Copper World 360,000-400,000 385,000-425,000 Precious Metal Precious Metal – Cobre Pan
Slide 21: Growth Outlook
GROWTH OUTLOOK 21 G R O W T H A N D O P T I O N A L I T Y Cobre Panama Optionality3 + Growth / Optionality 600 $2.4B Available Capital 550 540k to 600k GEOs 500 480k to 540k 498k GEOs 450 GEOs 10-15% GEOs 400 350 Organic Growth 300 250 200 2023 2024 Guidance 2028 Outlook² Excluding Cobre Panama¹ 1.
Slide 22: Organic Growth Pipeline
ORGANIC GROWTH PIPELINE 22 G R O W T H A N D O P T I O N A L I T Y Expansions1 Recent Mine Starts2 Subika to 2024 Séguéla 2023 Macassa (Kirkland Lake) to 2024 Magino 2023 Island Gold to 2026 Yandal (Bronzewing) 2023 Vale to 2026 Posse (Mara Rosa) 2024 Detour Lake to 2027 Salares Norte 2024 Under Con
Slide 23: Long-Term Optionality
LONG-TERM OPTIONALITY 23 G R O W T H A N D O P T I O N A L I T Y Assets beyond LONG-TERM ASSETS 5-year Outlook1 Holt (Au) Volcan Other (Au) Cascabel³ (Cu, Au, Ag) 4.1 Million Pandora Expansion M&I Royalty (PGM) Long-Term Ounces2 Ring of Fire Assets (Cr, Ni) 15 Advanced and NuevaUnión Crawford (Cu, A
Slide 24: Royalty Optionality
ROYALT Y OPTIONALITY 24 G R O W T H A N D O P T I O N A L I T Y 1. Calculation includes depletion 2. Total gold reserves associated with the top 37 assets at the time of IPO (not adjusted for FNV royalty ownership). All Mineral Reserves have been calculated in accordance with CIM or acceptable forei
Slide 25: Available Capital
AVAIL ABLE CAPITAL 25 G R O W T H A N D O P T I O N A L I T Y Available Cash and cash Credit capital3 equivalents1 Facility1, 2 ≈$1.4B ≈$1B $2.4B DEBT FREE 1. As at December 31, 2023 2. $1B Corporate Revolver N U E VA U N I Ó N ( R E L I N C H O ) 3. Funding commitments subsequent to December 31, 20
Slide 26: franco-nevada.com
FRANCO-NEVADA.COM TSX/NYSE: FNV
Slide 27: Appendix - GEOs and Non-GAAP Measures
APPENDIX-GEOS AND NON-GAAP MEASURES 27 1. GEOs include Franco-Nevada’s attributable share of production from our Mining and Energy assets, after applicable recovery and payability factors. GEOs are estimated on a gross basis for NSR royalties and, in the case of stream ounces, before the payment of
Slide 28: Board and Management
BOARD AND MANAGEMENT 28 A P P E N D I X BOARD MANAGEMENT David Paul Tom Paul Sandip Harquail Brink Albanese Brink Rana Chair of President Former CEO President CFO the Board & CEO Rio Tinto & CEO Eaun Hugo Derek Dr. Catharine Lloyd Gray Dryland1 Evans Farrow Hong SVP, Global Partner CEO Former CEO CL
Slide 29: Producing Asset News
PRODUCING ASSET NEWS 29 STREAMS Cobre Panama Panama The mine is currently on preservation and safe management. Panama election May 5, 2024. Candelaria Chile 2024 EIA approved September 2023. Potential expansion of UG operations. Antapaccay Peru Coroccohuayco project could extend mine life to 27+ yea
Slide 30: Producing Asset News (cont.)
PRODUCING ASSET NEWS (cont.) 30 ROYALTIES Mill throughput to reach 28.0 Mtpa by Q2 2024, targeting 29.0 Mtpa by 2026 and longer-term production of 1 Moz Detour Lake Ontario per year. Ongoing exploration success with expansion and UG mining study expected in H1 2024. Stillwater Montana Restructuring
Slide 31: Advanced and Exploration News
ADVANCED AND EXPLORATION NEWS 31 CONSTRUCTION AND RAMP-UP UPDATES First gold poured in May 2023. Sunbird Deposit to be incorporated into updated Mineral Resource and Séguéla1 Côte d’Ivoire Mineral Reserve. Commercial production achieved in November 2023. Alamos announced acquisition of Argonaut Gold
Slide 32: Advanced and Exploration News (cont.)
ADVANCED AND EXPLORATION N E W S (cont.) 32 DEVELOPMENT UPDATES Eskay Creek British Columbia Updated FS. FNV acquired an additional 1% NSR in December 2023, for an aggregate NSR of 2.5%. Final EIS and Draft Record of Decision (ROD) expected in Q2 2024 with Final ROD in Q4 2024. Perpetua Stibnite Gol
Slide 33: CRA Audit (2012-2019)
CRA AUDIT (2012-2019) 33 A P P E N D I X On April 28, 2023, Franco-Nevada reached a settlement with the CRA with respect to the domestic reassessments (2014-2017) and Foreign Accrual Property Income reassessments (2012-2013), with such reassessments to be vacated entirely. The potential tax exposure