Franco-nevada Corporation · TSX:FNV
Franco-nevada — Investor Presentation (May 2016)
20 slides from Franco-nevada's investor presentation, May 2016
Slide 1: Corporate Update
FNV TSX/NYSE Franco) Nevada May 2016 Corporate Update
Slide 2: Cautionary Statement
Cautionary Statement 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 include,
Slide 3: A Gold Focused Royalty/Stream Company
A Gold Focused Royalty/Stream Company Market Cap1 Available Capital Board of Directors ~ US$12.0 Billion ~ US$1.3 Billion Pierre Lassonde, Chair David Harquail, CEO FNV on TSX & NYSE Free Cash Flow Tom Albanese S&P/TSX 60 Margin2 > 75% Derek Evans GDX Overhead/mkt cap <0.2% Graham Farquharson Top Sh
Slide 4: Q1 2016 Financial Results
Q1 2016 Financial Results ($ millions except gold price, GEOs, per share and %) Q1 2016 Q1 2015 Gold Price ($/ounce) $1,181 $1,219 Gold Equivalent Ounces (GEOs)1 106,621 85,081 Revenue $132.0 $109.2 Adjusted EBITDA1 $103.7 $83.3 Adjusted EBITDA1 per share $0.62 $0.53 Net Income $30.0 $19.2 Net Incom
Slide 5: GEOs: Q1/2015 to Q1/2016
GEOs1: Q1/2015 to Q1/2016 27,949 106,621 85,081 3,812 6,270 134 2,787 1,298 1. See notes on slide 20 5
Slide 6: The Gold Investment that Works
The Gold Investment that Works 400% 350% FNV 300% 250% 200% 150% 100% 50% Gold 0% S&P/TSX Global -50% FNV IPO: Gold Dec 2007 -100% Index 2008 2009 2010 2011 2012 2013 2014 2015 2016 FNV and S&P/TSX Global Gold Index converted to USD. Chart to May 3, 2016. 6
Slide 7: Our Business Principles
Our Business Principles Maximize Minimize Exploration upside Cost exposures Security of tenure Margin encroachment Focus on new investments Involvement in operations Long term optionality 7
Slide 8: Business Model Benefits
Business Model Benefits Risk of: Gold ETF FNV Capital Costs 0% 0%1 Operating & Other Costs 0% 0%1 Benefit of: Leverage to Gold Price 1 >1 Exploration & Expansion 0% 100% Dividend Yield (0.4%)2 ~1.3% FNV provides yield and more upside than a gold ETF 1. Revenue royalties & streams. 8 2. Source: SPDR®
Slide 9: Franco-Nevada since IPO
Franco-Nevada since IPO GEOs1 Revenue Adjusted Net Income1 (000s) (US$ millions) (US$ per share) 400 500 1.40 450 350 1.20 400 300 350 1.00 250 GEOs (Koz) US$ per share US$ Millions 300 0.80 200 250 0.60 200 150 150 0.40 100 100 50 0.20 50 0 0 0.00 '08 '09 '10 '11 '12 '13 '14 '15 '08 '09 '10 '11 '12
Slide 10: Q1 2016 Revenue Sources
Q1 2016 Revenue Sources By Commodity By Geography 95% Precious Metals 82% from Americas 10
Slide 11: Diversified Portfolio
Diversified Portfolio Precious Metal Assets (selected) Goldstrike Stillwater Gold Quarry Marigold Fire Creek U.S. Bald Mountain Mesquite South Arturo Hollister Midas Sudbury Detour Holt Musselwhite Hemlo Canada Kirkland Lake Timmins W. Cdn. Malartic Brucejack Hardrock Antapaccay Antamina Candelaria
Slide 12: Other Positive Portfolio News
Other Positive Portfolio News Adding New Ounces Timmins West (Ontario) • 144 GAP discovery Detour (Ontario) • 23 year mine plan with West Detour Macassa (Ontario) • Kirkland Lake expanding SMC discovery 262 Mineral Fire Creek/Midas (Nevada) • Klondex’s exploration success & permits Assets Marigold (
Slide 13: New Investment Opportunities
New Investment Opportunities Cerro Moro – Yamana Gold Since Existing 3rd party 1985 Brucejack – Pretium Resources royalties Hardrock – Premier Gold Mines Since Palmarejo – Coeur Mining By-product funding 2008 Cobre Panama – First Quantum Kirkland Lake – Kirkland Lake Gold Since Primary product Stibn
Slide 14: Recent Cornerstone Investments
Recent Cornerstone Investments Antamina – Peru Cobre Panama – Panama $610 M – Teck Corporation $338 M → $1 B – First Quantum Candelaria – Chile Antapaccay – Peru $648 M – Lundin Mining $500 M – Glencore Long term assets with large land positions 14
Slide 15: Growing Projected GEOs
Growing Projected GEOs 84,000 75,000 37,500 65,000 273,000 More diversified and longer duration portfolio Note: Base GEOs assumes 2014 GEO production without Candelaria. Cobre Panama expected to start contributing to GEOs in 2018. Illustration assumes no decrease in production from existing portfoli
Slide 16: Outperformance Following Stream Transaction
Outperformance Following Stream Transaction 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Lundin Glencore Teck Relative share price performance since date of announcement versus S&P/TSX Base Metal Index 16
Slide 17: Outperformance Following Stream Transaction
Outperformance Following Stream Transaction 160.0% 140.0% 120.0% 100.0% 80.0% 60.0% 40.0% 20.0% 0.0% 1 Teranga Klondex True Gold Relative share price performance since date of announcement versus S&P/TSX Global Gold Index 1.) True Gold performance to April 27, 2016 when it was acquired by Endeavour
Slide 18: Over $1.3 B of Available Capital
Over $1.3 B of Available Capital US$ 1,000 US$ 1,333 US$ 83 US$ 250 Debt free 1. As at March 31, 2016 2. See notes on page 20 3. Does not include the US$250 million accordion facility 18 4. All figures in chart in millions
Slide 19: Franco-Nevada Provides: Why own a gold ETF?
Franco-Nevada Provides: Gold exposure at a discount Growth – organic and acquisitions FNV Dividends vs. ETF fees Gold FNV IPO: Dec 2007 S&P/TSX Global Gold Index 2008 2009 2010 2011 2012 2013 2014 2015 2016 Why own a gold ETF? At May 3, 2016; FNV and S&P/TSX Global Gold Index converted to USD 19
Slide 20: Appendix – Non IFRS Measures
Appendix – Non IFRS Measures 1. Adjusted Net Income and Adjusted Net Income per share are non-IFRS financial measures, which excludes the following from net income and net income per share: foreign exchange gains/losses and other income/expenses; gains/losses on the sale of investments; impairment c