Franco-nevada Corporation · TSX:FNV
Franco-nevada — Investor Presentation (September 2024)
37 slides from Franco-nevada's investor presentation, September 2024
Slide 1: Corporate Presentation September 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 S E P T E M B E R
Slide 2: Cautionary Statement
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 $2.4B Available Capital 1. Compounded annual tot
Slide 4: Business Model Advantages
BUSINESS MODEL ADVANTAGES 4 B U S I N E S S M O D E L UPSIDE POTENTIAL LOW RISK Optionality Diversified Portfolio Potential for exploration success on ~67,600 km2 (1) Non-operating business is more scalable Focus on Growth High Margins & Low Overhead Management not occupied with operational decision
Slide 5: Financing Successful Mines
FINANCING SUCCESSFUL MINES 5 B U S I N E S S M O D E L DEBT EMERGING PROJECT M&A REDUCTION PROJECTS DEVELOPMENT Alignment with partners for a win-win solution
Slide 6: Why Is Franco-Nevada Different?
WHY IS FRANCO-NEVADA DIFFERENT? 6 B U S I N E S S M O D E L Shareholder Alignment Committed to high share ownership and treating shareholder funds as our own (low G&A) Financial Flexibility Avoiding long-term debt and paying progressive and sustainable dividends ensuring capital availability at all
Slide 7: Shareholder Returns
SHAREHOLDER RETURNS 7 L E A D I N G T R A C K R E C O R D Franco-Nevada (FNV) - US$ 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 1,000 500 800 800 400 600 600 300 400 200 400 200 200 100 - - - '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 >$2.3B3 $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 Community Good Governance & Allocation Contributions 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 Transparent ESG Disclosure Maintaining a safe and supportive environment for our team, removing Providing transparency in all ESG matters relating to our business and barriers and promoting diversity and inclus
Slide 15: Assets
432 ASSETS Covering OUR Approximately PORTFOLIO ~67,600 km2 432 TOTAL 118 Precious Metals Diversified PRODUCING 38 Precious Metals Diversified ADVANCED 276 EXPLORATION Not all assets shown on map, including exploration assets Asset count as of August 30, 2024 Cobre Panama currently on preservation a
Slide 16: SolGold Transaction Highlights
SOLGOLD TRANSACTION HIGHLIGHTS 16 • Franco-Nevada (70%) and Osisko Royalties (30%) syndicated US$750M gold stream financing for the development and construction of SolGold’s Cascabel deposit in Ecuador • Franco-Nevada to make US$70M available in tranches pre-construction and remaining US$455M of con
Slide 17: Cascabel Project Overview
CASCABEL PROJECT OVERVIEW 17 Positive PFS Study (March 8, 2024)1 • Alpala deposit has high grade reserves that support a block caving operation with attractive development economics1 Total M&I Resource 18.2 Mt CuEq2 (Alpala + TAM) • Current mine plan represents only a small portion of the known LOM
Slide 18: Gold Stream Summary
GOLD STREAM SUMMARY 18 Key Stream Terms Syndication : • 70% Franco-Nevada (FNB) / 30% Osisko Total Deposit: • US$750M (FNB US$525M) Location: • Ecuador • 20% (FNB 14.0%) of gold produced in concentrate until 750Moz (FNB 525koz) of gold have been Stream Parameters delivered (100% basis): • Thereafter
Slide 19: Yanacocha 1.8% Royalty Acquisition
YANACOCHA 1.8% ROYALT Y ACQUISITION 19 • Franco-Nevada has acquired a 1.8% net smelter return royalty from Buenaventura covering Newmont’s Yanacocha mine and Yanacocha Sulfides project o Royalty also covers surrounding deposits, including Conga Royalty Coverage (+750 km2) • Upfront consideration of
Slide 20: Cobre Panama Update
COBRE PANAMA UPDATE 20 o Law 406 found to be unconstitutional (November 2023)1 o Mine on preservation and safe management o Franco-Nevada international arbitration2 o $1,169.2 impairment recorded in 2023 o President José Raúl Mulino took office on July 1, 2024 1. Law 406 approved the revised contrac
Slide 21: Detour Lake Update
DETOUR L AKE UPDATE 21 P A T H W A Y T O 1 M O Z P E R A N N U M 2024 LOM plan and UG PEA UG PEA extends mine life to 2054, Proposed mill expansion to Ongoing exploration released in June 2024 with 27% adding additional 4Moz, with first 29Mtpa with average production of satellite targets. increase i
Slide 22: Return on Investment
RETURN ON INVESTMENT 22 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 (2008) Return $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 US$ (Millions)
Slide 23: 2024 GEOs Diversification
2024 GEOs DIVERSIFICATION 1 23 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 24: Guidance
GUIDANCE 24 G R O W T H A N D O P T I O N A L I T Y GEOs 2024 Guidance1 2028 Outlook2 GEOs 480,000-540,000 540,000-600,000 Total Total – Post Q2 2024 results, guidance expected at the lower end + Vale Northern and Southeastern Systems – Assumes lower oil and gas prices1 + Copper World 360,000-400,00
Slide 25: Growth Outlook
GROWTH OUTLOOK 25 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 26: Organic Growth Pipeline
ORGANIC GROWTH PIPELINE 26 G R O W T H A N D O P T I O N A L I T Y Expansions1 Recent Mine Starts Subika to 2024 Séguéla 2023 Macassa (Kirkland Lake) to 2024 Magino 2023 Island Gold to 2026 Yandal (Bronzewing) 2023 Magino to 2026 Posse (Mara Rosa) 2024 Vale to 2026 Salares Norte 2024 Detour Lake to
Slide 27: Long-Term Optionality
LONG-TERM OPTIONALITY 27 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 28: Royalty Optionality
ROYALT Y OPTIONALITY 28 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 29: Available Capital
AVAIL ABLE CAPITAL 29 Available Cash and cash Credit capital3 equivalents1 Facility1, 2 ≈$1.4B ≈$1B $2.4B DEBT FREE 1. As at June 30, 2024 2. 3. $1B Corporate Revolver Funding commitments subsequent to June 30, 2024, include $210 million for the acquisition of the Yanacocha royalty. N U E VA U N I Ó
Slide 30: franco-nevada.com
FRANCO-NEVADA.COM TSX/NYSE: FNV
Slide 31: Appendix - GEOs and Non-GAAP Measures
APPENDIX-GEOS AND NON-GAAP MEASURES 31 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 32: Board and Management
BOARD AND MANAGEMENT 32 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 Dryland Evans Farrow Hong SVP, Global Partner CEO Former CEO CLO
Slide 33: Producing Asset News
PRODUCING ASSET NEWS 33 STREAMS Cobre Panama Panama The mine is currently on preservation and safe management. President José Raúl Mulino took office on July 1, 2024. Candelaria Chile 2024 EIA approved September 2023. Potential expansion of UG operations. Antapaccay Peru Coroccohuayco project could
Slide 34: Producing Asset News (cont.)
PRODUCING ASSET NEWS (cont.) 34 ROYALTIES 2024 LOM plan and UG PEA released in June 2024 with 27% increase in LOM production. Proposed mill expansion Detour Lake Ontario to 29Mtpa with average production of 1Mozpa from 2030 to 2043. UG PEA extends mine life to 2054, adding additional 4Moz, with firs
Slide 35: Advanced and Exploration News
ADVANCED AND EXPLORATION NEWS 35 CONSTRUCTION AND RAMP-UP UPDATES Posse (Mara Rosa) 1 Brazil First gold poured in February 2024. Commercial production achieved in May 2024. First gold poured in March 2024. Commissioning and ramp-up impacted by earlier than planned winter Salares Norte1 Chile conditi
Slide 36: Advanced and Exploration News (cont.)
ADVANCED AND EXPLORATION N E W S (cont.) 36 DEVELOPMENT UPDATES Updated FS. FNV acquired an additional 1% NSR in December 2023, for an aggregate NSR of 2.5%. Skeena Eskay Creek British Columbia Resources secured US$750M financing package on June 25th, 2024, allowing project advancement pre- permitti
Slide 37: CRA Audit (2013-2020)
CRA AUDIT (2013-2020) 37 A P P E N D I X With respect to the transfer pricing reassessments in relation to the Company’s Mexican and Barbadian subsidiaries, the Company continues to believe that these reassessments are not supported by Canadian tax law and jurisprudence and intends to vigorously def
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