Franco-nevada Corporation · TSX:FNV
Franco-nevada — Investor Presentation (September 2009)
18 slides from Franco-nevada's investor presentation, September 2009
Slide 1: September Presentation
ts Franco-Nevada September Presentation Member of World Gold Council i meld oe Franco-Nevada
Slide 2: Cautionary Statement
Cautionary Statement Forward-Looking Statements This Presentation contains "forward-looking statements", which may include but are not limited to, statements with respect to future events or future performance, management's expectations regarding Franco-Nevada’s growth, results of operations, estima
Slide 3: Leading gold royalty company
Franco-Nevada Leading gold royalty company Secure and profitable assets Goldstrike High free cash flow(1) margins Growing gold revenue Active acquirer with > $700m in Gold Quarry available capital Semi annual dividend increased to C$0.14 per share Part of S&P/TSX Composite Index with US$2.8B market
Slide 4: Quality Portfolio: Diversified & Geopolitically Secure Assets
Quality Portfolio Diversified & Geopolitically Secure Assets % of Royalty Revenue (1) 66% 20% >300 Royalty Assets Worldwide with Majority of Royalty Revenue from US & Canada (1) Royalty Revenue is defined by the Company as cash received or receivable from operating royalty assets 4 earned during the
Slide 5: Quality Portfolio: Balanced Growth Profile
Quality Portfolio Balanced Growth Profile BASE GROWING FUTURE UPSIDE GOLDSTRIKE PALMAREJO DETOUR >145 GOLD QUARRY TASIAST PERAMA HILL EXPLORATION INTERESTS STILLWATER HOLLISTER PINSON >100,000 OIL & GAS HEMLO PANDORA ACRES OF MARIGOLD ROSEMONT UNDEVELOPED ROBINSON FALCONDO O&G LANDS OTHERS… HOLLOWAY
Slide 6: Gold Focus with Added Optionality
Quality Portfolio Gold Focus with Added Optionality 45 40 35 30 ($ millions) 25 20 15 80% 55% 56% 77% 10 55% 61% 5 0 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Gold PGM Base Metals & Other Oil & Gas Increasing precious metals contribution in absolute & relative terms Chart reflects Royalty Reve
Slide 7: Solid Assets with Quality Operators
Quality Portfolio Solid Assets with Quality Operators Goldstrike outperformed guidance for the first half of 2009 Goldstrike - Barrick Contribution from Palmarejo minimum payments beginning in Q3/09 Palmarejo - Coeur Oil & gas assets performing ahead of expectations Weyburn - Encana Potential to inc
Slide 8: Future Growth Assets
Quality Portfolio Future Growth Assets Property Royalty Operator Update Tasiast 2% NSR Red Back Mining Reserves and resources have been rapidly expanded with resources now >4 Moz* Hollister 3-5% NSR Great Basin Gold Recent discovery on 5% royalty ground. Hemlo 3% NSR & Barrick Gold Underground devel
Slide 9: Free Cash Flow in All Likely Scenarios
High Margin Business Free Cash Flow in All Likely Scenarios Free Cash Flow(1) By Quarter $35.0 $30.0 85% 85% $25.0 $20.0 Millions Royalty Revenue (1) Free Cash Flow (2) $15.0 $10.0 $5.0 $0.0 Q1/09 Q2/09 (1) Free Cash Flow is defined by the Company as operating income plus depletion and depreciation,
Slide 10: Royalties Limit Downside Exposure
High Margin Business Royalties Limit Downside Exposure Commodity and exploration exposure with less downside 10
Slide 11: Undervalued Free Cash Flow per Share
High Margin Business Undervalued Free Cash Flow per Share Free Cash Flow per $1,000 Investment (1) Assumes Franco’s >$500m not invested (1) Source: CIBC Equity Research. Calculations based on 1H 2009 actual results, annualized. FCF is 11 represented by operating cash flow less capital expenditures.
Slide 12: Growth Through Acquisition: Track Record
Growth Through Acquisition Track Record $103.5 million $80 million Dec 29, 2008 Jan 21, 2009 7.29% gross royalty at 50% gold royalty stream at Gold Quarry, Nevada Palmarejo, Mexico April 2009 Update: March 30, 2009 Update: Increased minimum guidance First gold poured to 14,400 oz/annum Precious meta
Slide 13: Growth in Gold Revenue
Growth Through Acquisition Growth in Gold Revenue Palmarejo 2009(1) Palmarejo 2010+(2) 9.0 8.0 Palmarejo Royalty Revenue 7.0 Potential 6.0 Gold Minimum Capacity US$ (millions) Price 5.0 $800/oz $20m $24m 4.0 $900/oz $25m $30m 3.0 $1000/oz $30m $36m 2.0 1.0 - Q1/09 Q2/09 Q3/09 Q4/09 Actual/Minimum Po
Slide 14: Growth in H1 2009
Growth Through Acquisition Growth in H1 2009 Proforma Royalty Revenue - 1H 2009 Annualized 120 GQ Minimum(3) 100 Palmarejo US$ (millions) 80 Minimum(2) 60 40 Existing Existing Gold Gold Revenue(1) Revenue 20 0 Acquisitions have grown gold revenues >50% (1) Existing Gold Royalty Revenue based on annu
Slide 15: Financial Strength
Growth Through Acquisition Financial Strength Capital Resources @ June 30, 2009 US$ Millions Working Capital $513 Marketable Securities $54 Available Credit Facility $150 Total Available Capital $717 No debt or hedges and limited capital obligations Potential catalyst for share price increase 15
Slide 16: The Leading Gold Royalty Company
The Leading Gold Royalty Company Low risk business model and portfolio High margins and Free Cash Flow(1) More capital for royalty growth (1) Free Cash Flow is defined by the Company as operating income plus depletion and depreciation, non-cash 16 charges, and any impairment of investments and royal
Slide 17: Franco-Nevada (TSX:FNV) Capital Structure
Franco-Nevada (TSX:FNV) Capital Structure: Common 112.0m shares outstanding (FNV) Warrants 5.75m @ $32/sh Mar. 2012 (FNV.WT) Warrants 5.75m @ $75/sh June 2017 (FNV.WT.A) Warrants 316,436 Special Warrants Share Price Range(1) C$31.49 - C$11.62 Market Capitalization(2) US$2.8B Working Capital + Invest
Slide 18: Thank You
Thank You Goldstrike - Barrick Weyburn Bald - Encana Mountain - Barrick East Boulder - Stillwater Palmarejo - Coeur Cerro San Pedro - New Gold Mesquite – New Gold Marigold - Goldcorp Robinson - Quadra Tasiast - Red Back Marigold - Goldcorp 18
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