Deterra Royalties Ltd · ASX:DRR
Deterra Royalties — Investor Presentation (September 2024)
35 slides from Deterra Royalties's investor presentation, September 2024
Slide 1: Corporate Presentation September 2024
Corporate Presentation September 2024 | ASX: DRR
Slide 2: Disclaimers
Disclaimers This presentation has been prepared by Deterra Royalties Limited ACN 641 743 348 (“Deterra”, “the Company”). By accessing decisions to expand, continue or reduce production from, or exploration of, a mining asset. The interests of the Company and this presentation, you acknowledge that y
Slide 3: A royalty vehicle with a difference
A royalty vehicle with a difference Existing royalty assets underwrite our strong financial performance and provide a solid foundation for value accretive growth High quality REVENUE assets delivering >$850 million since listing& strong financial At an average 95% EBITDA1,2 Margin 257 performance 21
Slide 4: Founded on a world-class cornerstone asset
Founded on a world-class cornerstone asset Mining Area C (MAC) royalty provides top line exposure to one of the premier iron ore mines globally by scale, cost position, quality of the operator and remaining asset life • World’s largest iron ore hub1 At full capacity Mining Area C will account for 9%
Slide 5: Pursuing value through growth and diversification
Pursuing value through growth and diversification Key focus for disciplined growth Value accretive growth delivers: 9 29 Market Capitalisation (US$bn) 8 2.0x • Quality: building on world class foundational MAC 24 7 Royalty with additional large, long-life, low-cost assets 6 1.5x = P/NAV(1) 9 5 • Div
Slide 6: Disciplined in pursuit of growth
Disciplined in pursuit of growth Targeting value accretive opportunities Prioritising where we have a competitive advantage Quality: world class foundation in long-life MAC royalty Size Commodity Geography Stage Liquidity: cash flow and debt facilities provide investment Broad mandate • Bulks Develo
Slide 7: Liquidity and flexibility to fund growth and manage returns
Liquidity and flexibility to fund growth and manage returns Capital management framework balances future growth and shareholder returns Funding capacity Capital management framework Priorities Strong cash flow generation Flexibility to invest counter-cyclically Shareholder returns • Established cash
Slide 8: Acquisition of Trident Royalties PLC
Acquisition of Trident Royalties PLC
Slide 9: Acquisition of Trident Royalties PLC
Acquisition of Trident Royalties PLC Transaction Overview Timeline • On June 13, 2024, Deterra announced an all-cash offer to acquire Trident Royalties plc 13-Jun: R2.7 Announcement (Trident) for 49 pence per share, for total consideration of ~£144 million (A$276 million) 1 Overview1 • Trident is a
Slide 10: Highlights
Highlights Strategic and synergistic Portfolio quality • Portfolio aligned with target investment • High-quality cornerstone asset: parameters ‒ Thacker Pass royalty provides exposure to long-life, • Counter-cyclical timing large scale lithium project in mining-friendly jurisdiction • Targeting annu
Slide 11: Building a platform with diversification and scale
Building a platform with diversification and scale Global scale diversified royalty company $2.2 billion pro forma enterprise value1 Substantial cash generation $256 million capability FY2024 pro forma cash flow2 Broadening 28 assets asset base 15 paying royalties and offtakes (1) DRR market capital
Slide 12: Portfolio overview
Portfolio overview Deterra’s assets have grown from 6 to 28 following the completion of the Trident acquisition 15 Thacker pass Lithium royalty 28 Assets Cash 6 Commodities 11 flowing Countries assets Eagle1 Gold offtake Greenstone Gold offtake Big Kidd Sugar Zone Copper royalty Gold offtake Lincoln
Slide 13: Strategic rationale for Trident Acquisition
Strategic rationale for Trident Acquisition 1 Attractive portfolio aligned with investment criteria that delivers commodity and geographical diversification 2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition 3 Flagship Thacker Pass royalty provides long
Slide 14: Aligned with Deterra's stated growth strategy
1 Aligned with Deterra’s stated growth strategy Provides exposure to commodities within targeted bulk, base and battery metals from mining operations largely located in stable and established mining jurisdictions Size Commodity Geography Stage Net asset value of ~$310 Base, precious, bulk and Majori
Slide 15: Strategic rationale for Trident Acquisition
Strategic rationale for Trident Acquisition 1 Attractive portfolio aligned with investment criteria that delivers commodity and geographical diversification 2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition 3 Flagship Thacker Pass royalty provides long
Slide 16: Strong long-term fundamentals for underlying commodities
2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition Global Passenger Electric Vehicle sales forecast to grow at a rate of 20% per annum over the next five years Global Passenger Electric Vehicle sales forecast to grow at a rate of 20% per annum over the
Slide 17: Strong long-term fundamentals for underlying commodities
2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition Energy transition is adding to traditional copper demand Mimbula – Zambia, 0.3% Gross Revenue Royality1 growth Phase 1 production of 10ktpa of copper cathode, initial Phase 2 target of 20ktpa Bankable F
Slide 18: Strategic rationale for Trident Acquisition
Strategic rationale for Trident Acquisition 1 Attractive portfolio aligned with investment criteria that delivers commodity and geographical diversification 2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition 3 Flagship Thacker Pass royalty provides long
Slide 19: Thacker Pass Highlights
3 Thacker Pass Highlights Thacker Pass royalty provides long life, large-scale exposure to the battery materials sector in USA Scalable asset with ✓ Long life asset with M&I resources of 16.1Mt LCE at 0.21% Li1 and reserves of 3.7Mt LCE at 0.32% Li1, supporting 40+ year mine life2 extension potentia
Slide 20: Strategic rationale for Trident Acquisition
Strategic rationale for Trident Acquisition 1 Attractive portfolio aligned with investment criteria that delivers commodity and geographical diversification 2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition 3 Flagship Thacker Pass royalty provides long
Slide 21: Immediate cash flow with multiple growth options
4 Immediate cash flow with multiple growth options Trident provides 12 cashflow producing offtakes and royalties, with a suite of future potential growth assets Trident Royalty and Offtake Related Revenue (US$M)1,2 9.5 7.9 4.9 2H 1H 2022 2023 2024 Growth Commodity split Precious Metals Bulk Base Sou
Slide 22: Strategic rationale for Trident Acquisition
Strategic rationale for Trident Acquisition 1 Attractive portfolio aligned with investment criteria that delivers commodity and geographical diversification 2 Strong long-term fundamentals for underlying commodities / leverage to global energy transition 3 Flagship Thacker Pass royalty provides long
Slide 23: Leverages Deterra's scalable operating cost structure
5 Leverages Deterra’s scalable operating cost structure Targeting meaningful G&A and financing synergies over the course of FY25 Trident 2023A1: Opportunity: • Reported operating • Removal of duplicated costs Targeting annual expense: including duplicated board costs, listing costs, general net oper
Slide 24: Appendices
Appendices
Slide 25: Deterra corporate snapshot
Deterra corporate snapshot The largest and only significant royalty company on the ASX BOARD AND KEY MANAGEMENT CAPITAL STRUCTURE Non-Executive Chairman Jennifer Seabrook Share price1 $3.66 Managing Director and CEO Julian Andrews Shares on issue 528.6m Non-Executive Director Graeme Devlin Market ca
Slide 26: Mining Area C Royalty Overview
Mining Area C Royalty Overview MAC royalty area(3) Tandanya 65 Mtpa Description1 North Flank 145Mtpa hub, comprised of 80Mtpa from South Flank and Large 65Mtpa from North Flank Long Life MAC hub has the potential to support 45+ year mine life Mudlark South Flank ̴ 35% of WAIO total Mineral Resource
Slide 27: Thacker Pass Royalty Overview
Thacker Pass Royalty Overview • Thacker Pass is a lithium clay project located in Northern Nevada, fully owned and Location operated by Lithium Americas • Thacker Pass will be constructed over two phases with Phase 1 under construction USA NV McDermitt ID whilst Phase 2 will be committed to later •
Slide 28: Gold offtake portfolio
Gold offtake portfolio Overview Operator Asset Location Status Quotation Terms Gold offtakes summary Offtake on 50% of all refined gold production, up to cap of 1,100,000 ounces of Los Filos Producing 6 days refined gold 1.34% realised offtake margin1 Fazenda Producing 6 days Diversified asset: 8 of
Slide 29: Deterra Asset Summary - Bulk Assets
Deterra Asset Summary - Bulk Assets Iron Ore and Heavy Minerals Yoongarillup/ Asset Mining Area C Koolyanobbing Kwale Yandanooka Wonnerup Yalyalup7 Location Western Australia Western Australia Kenya Western Australia Western Australia Western Australia Doral Mineral Sands Pty Image Resources Ltd Ope
Slide 30: Deterra Asset Summary – Base and Battery Metal Assets
Deterra Asset Summary – Base and Battery Metal Assets Base and Battery Metals Asset Thacker Pass Sonora Paradox Antler Mimbula Pukaqaqa Big Kidd Location Nevada, USA Mexico Utah, USA Arizona, USA Zambia Peru BC, Canada Operator Lithium Americas Ganfeng Lithium Anson Resources New World Resources Mox
Slide 31: Deterra Asset Summary - Precious Metals Assets
Deterra Asset Summary - Precious Metals Assets Gold / Silver Royalty Gold Offtake Ruby Green Hill/Cove/ Asset Lincoln Dandoko La Preciosa St Ives Los Filos Fazenda RDM Santa Luz Blyvoor Eagle Bonikro Sugar Zone stone Granite Creek Western Location USA Mali Mexico Mexico Brazil Brazil Brazil Canada S
Slide 32: Further References
Further References Additional Public Information Links Asset Company Public Material / Announcement • BHP – Mining Area C Website Mining Area C BHP • BHP – South Flank Website (Iron Ore) • BHP – WAIO Investor Day (South Flank) Koolyanobbing • Mineral Resource Statement (JORC) – Koolyanobbing, Mt Dim
Slide 33: Further References (Cont'd)
Further References (Cont’d) Additional Public Information Links Asset Company Public Material / Announcement Lincoln Seduli Gold • Preliminary Economic Study (NI 43 101), Technical Report on Lincoln Mine, California (2 nd July 2015) (Gold) Dandoko B2 Gold • Feasibility Study (N1 43 101), Technical R
Slide 34: The power of royalty assets
“Top line” Commodity price Project The power of royalty cashflows leverage optionality assets Royalty revenue derived from asset’s Direct exposure to underlying Asset expansions and extensions drive revenue line, or with commodity price royalty values Lower exposure to capital and limited, defined o
Slide 35: For more information
For more information Investor and media enquiries Jason Clifton Chief Financial Officer Email: investor.relations@deterraroyalties.com Deterra Royalties Limited ACN 641 743 348 Level 16, 140 St Georges Terrace Perth WA 6000 Telephone: +61 (0)8 6277 8880 www.deterraroyalties.com
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