Slide 1: Australian Securities Exchange Notice
3 Australian Securities Exchange Notice 18 August 2021 ASX: DRR FY21 Financial Results and Outlook Presentation Deterra Royalties Limited (ASX: DRR) (Deterra or Company) is pleased to release a results and outlook presentation for the period ended 30 June 2021. An investor and analyst briefing will
Slide 2: Financial Results and Outlook
Financial Results and Outlook For the period ended 30 June 2021 18 August 2021 Julian Andrews Managing Director and Chief Executive Officer The resources Brendan Ryan Chief Financial Officer investment that pays
Slide 3: Important notices and disclaimer
Important notices and disclaimer This presentation has been prepared by Deterra Royalties Limited (“Deterra”, “the Company”). By accessing this presentation you acknowledge that you have read and understood the following statement. The material in this presentation is general background information
Slide 4: A better way to invest in the resources industry
A better way to invest in the resources industry ► Operate with Integrity ► Monitor Performance ► Maintain Transparency Delivering attractive and sustainable shareholder returns ► Diversify our Portfolio ► Act with Discipline ► Manage Risk 3
Slide 5: Achievements for FY21
Achievements for FY21 Successful demerger & • Board and management team fully in place ASX listing • Implemented lean corporate structure • Revenue of $145.2 million with an NPAT of $94.3 million1 Lean business model • Underlying EBITDA of $135.5 million at a Post-demerger margin of 96% delivering s
Slide 6: Delivering strong financial outcomes
Delivering strong financial outcomes Statutory accounts1 Attributable to2: Total Revenue Revenue Revenue $145.2M $29.3M $115.9M Underlying EBITDA3 Underlying EBITDA Underlying EBITDA $135.5M $24.4M $111.1M NPAT NPAT NPAT $94.3M $20.4M $73.9M Dividends per share4 DPS4 DPS 17.83¢ 3.86¢ 13.97¢ (100% of
Slide 7: Financial results
Financial results
Slide 8: FY21 reporting period
FY21 reporting period Deterra Royalties Limited (DRL) was incorporated 15 June 2020 and successfully demerged from Iluka Resources on 2 November 2020 Royalty revenue begins DRL Pays Dividend to Iluka (30 Oct) DRL Incorporated (15 Jun) to accrue to DRR3 DRL Acquires DRML1 from Iluka (30 Jun) DRL deme
Slide 9: Mining Area C Royalty performance
Mining Area C Royalty performance The MAC Royalty performed strongly in a backdrop of a robust iron ore price environment Revenue breakdown MAC quarterly receipts and implied sales price AUD million AUD million, A$/tonne (FOB, Australia) FY21 MAC Revenue royalty FY21 Capacity payment 1 Other royalti
Slide 10: Robust financial performance
Robust financial performance Offering a lower risk, higher margin exposure to the resources sector, with a focus on shareholder returns Simple and transparent business model, providing investors strong visibility on earnings, cash flows and dividends without full exposure to some of the key operatin
Slide 11: Delivering strong shareholder returns
Delivering strong shareholder returns Building a track record of disciplined capital management and shareholder returns H1 FY21 attributable to ILU 100% NPAT • Dividend policy of 100% of NPAT1 Demonstrated 100% payout ratio H1 FY21 attributable to DRR Payout • Franked to maximum extent possible AUD
Slide 12: Strategy and outlook
Strategy and outlook
Slide 13: Our core asset – the Mining Area C Royalty…
Our core asset – the Mining Area C Royalty… Low-risk exposure to a large, low-cost iron ore mining complex that is set to grow its volumes by approximately 2.4 times Low-cost operations with long life Significant near-term growth Resource upside in a low-risk through South Flank expansion jurisdicti
Slide 14: … is leveraged to South Flank growth
… is leveraged to South Flank growth Deterra’s MAC Royalty revenue is determined by BHP’s realised iron ore prices, sales volumes and foreign exchange rates MAC Royalty annual receipts – Illustrative production and price sensitivity1 Revenue royalty payment of 1.232% of realised (AUD million) AUD FO
Slide 15: Targeted growth strategy focused on value-accretive investment
Targeted growth strategy focused on value-accretive investment Deterra’s screening process and investment criteria prioritise opportunities where it has a competitive advantage Primary royalties Creating new royalties for: How we prioritise opportunities • Project capital Investment criteria • Balan
Slide 16: Capital structure and funding for growth
Capital structure and funding for growth The high-quality MAC cash flows and conservative capital management provides Deterra with strong capacity to fund growth New Other New Cornerstone MAC Royalty Royalties Royalty Investments Retain strong Net cash position at 30 June 2021 Revenue balance sheet
Slide 17: Committed to sustainable shareholder returns
Committed to sustainable shareholder returns Our sustainability roadmap outlines our commitment to transparent reporting of our ESG performance and objectives Targeting net-zero operational GHG footprint by the end of FY22 16
Slide 18: Six key drivers of success
Six key drivers of success Maximise returns Grow value responsibly 1 Cash generative assets with strong embedded production growth 4 Increase scale and diversification through complementary value-accretive acquisitions 2 Low cost, scalable corporate structure and 5 Disciplined capital allocation hig
Slide 19: For more information:
For more information: Investor and Media enquiries Rob Ward Corporate Development and Investor Relations Mobile: + 61 (0) 431 596 831 Email: robert.ward@deterraroyalties.com Brendan Ryan Chief Financial Officer Email: investor.relations@deterraroyalties.com Deterra Royalties Limited ACN 641 743 348
Slide 20: Appendix
Appendix -aip iT =a = E= —
Slide 21: Portfolio of royalties
Portfolio of royalties Project Counterparty Location Commodity Status Royalty Key Terms BHP Billiton Minerals Pty Ltd; 1.232% of MAC product Itochu Minerals & Energy of revenue Mining Area C (MAC) Australia Pty Ltd; Pilbara, WA Iron Ore Producing $1 million per 1Mdmt Mitsui Iron Ore Corporation Pty
Slide 22: Underlying EBITDA and earnings adjustments
Underlying EBITDA and earnings adjustments Pre-demerger Post-demerger Earnings and earnings adjustments1 Total period2 period period $’000 $’000 $’000 Net Profit After Tax 20,393 73,867 94,260 add back income tax expense 8,757 32,118 40,875 add back income tax expense on acquired receivable 6,512 -
Slide 23: MAC Royalty overview
MAC Royalty overview MAC Royalty is Deterra’s cornerstone asset and consists of annual production-related Capacity Payments and ongoing quarterly revenue payments Illustrative MAC value chain and royalty payment mechanisms: Mine Mine Customer production stockpiles Rail logistics Port stockpiles Ocea