I have the thumbs up, so good afternoon, ladies and gentlemen. I'd like to welcome you to the 2025 Annual and Special Meeting of the Shareholders of Franco-Nevada Corporation. My name is David Harquail, and as Chair of the Board of Directors of the company, I'll chair the formal portion of the meeting. Following that, Paul Brink will have the pleasure—he's our President and CEO—to provide some remarks and an overview of the company. This is the 18th Annual General Meeting in the current form of Franco-Nevada, so I had the pleasure of doing Paul's presentation for the first 13. This will be now the fifth Annual Meeting that Paul has presided over as the President and CEO, and I think you'll see how the company has been advancing under his leadership.
Now, today we're doing this both in person and by webcast, and I thank those that sent in their votes by proxy. I understand we have over 80% of the shareholder votes in, and we're still counting, so that's a very high level of receipts. I'd also like to get your feedback. We talked today about the—we've always done traditionally in-person meetings, but I find the hybrid meetings are a bit more structured and less free-flowing. I would like to get the perspective of those that are online in terms of how important it is to continue to do hybrid meetings, or if people feel they're actually comfortable with only virtual meetings. The nice thing is if we save the cost of doing the webcast, we could do a much better reception after this Annual Meeting.
Right now you're going to get a so-so reception after this meeting, and you're well invited. Also, we wanted to make sure because it is an in-person meeting we wanted to have a decent crowd, so we invited all our employees. They're in the audience today. I'd like to introduce your head table. Now, besides myself, is Paul Brink, the President and CEO; Sandip Rana, our Chief Financial Officer; and Lloyd Hong, our Chief Legal Officer and Corporate Secretary. I also want to introduce some members of the leadership team: Eaun Gray, the Chief Investment Officer—and you have to look at the camera, apparently, too, so just that'll be good—and Jason O'Connell. That's—so look at the wave. That'll be terrific—our Senior Vice President of Diversified. I'm going to call things to order, and actually, I'm reading the same page over again.
That's good. Now, all of our directors are present this afternoon in person. I'd like to introduce our directors and ask each of them, as I call out their name, if you could stand, look at the camera, then turn around, wave, and then sit down. All right. Tom Albanese. Hugo Dryland. Thank you. Derek Evans. Dr. Katherine Farrell. Maureen Jensen. Jennifer Mackey. Jacques Perron. Also joining us today is Daniel Malchuk, who was appointed to the board in January and is standing for election as a first-time nominee. Franco-Nevada is celebrating a 17th anniversary, although this is our 18th AGM, since its IPO. We'd now like to move on to the formal part of the meeting. I'd ask that Lloyd Hong, as Secretary of the Meeting, and Anup Das and Hasib Iftekhar as representatives of Computershare to act as scrutineers.
The scrutineers will report on the number of shares represented at this meeting or by proxy. Proof of service of this notice of calling of this meeting has been filed, and I direct that a copy of the notice and affidavit, proving service, therefore, be annexed to the minutes of this meeting. I've been advised that there's a quorum and request that the scrutineers report be annexed to the minutes. I therefore declare that this meeting is regularly called and properly constituted for the transaction of business. I will ask our Chief Legal Officer, Mr. Hong, to provide details on the logistics for this meeting.
Thank you, Mr. Chairman. As mentioned, this will be a hybrid meeting allowing both in-person and virtual participation. Here are the logistics for the meeting. If you're on the webcast, detailed instructions are displayed on how to vote, ask questions, and get technical assistance if necessary. If you're on the phone line, please note that you cannot vote or ask questions. We will conduct the votes on all matters before us by poll. On a poll, every shareholder is entitled to vote on the matter as one vote in respect of each share. I would now ask Lumi to open the polls for voting on all of the matters of business for this meeting and keep the polls open until after all of the items of business have been presented, and the Chairman has asked for the polls to be closed.
For those shareholders present in person, you should have been provided with a ballot form if you registered with the scrutineers on your arrival. If you have not yet received a ballot form, please go to the registration desk, and one will be provided to you. As the polls are now open. Sorry. Nope.
Is this on? Okay.
As the polls are all open, you are now able to cast your vote on all items of business until the Chairman closes the polls at the end of the meeting. You do not need to wait for each specific item of business to vote and are free to vote at any time. Moving on to questions. For those here in person who have any questions on the items of business, please raise your hand at the appropriate time, and a microphone will be brought to you. If you're participating on the webcast and have any questions on the items of business, please type in your question or comment in the messaging section of the Lumi Platform in advance, as there is a delay between the live meeting and the webcast, and I will read the question aloud.
We will take applicable questions after each item of business. If your questions are more general in nature, we would ask that you please wait until the formal business of the meeting has been concluded, as we will have a Q&A session afterwards. After all the matters of business have been presented and the voting has been closed, Computershare will tabulate the results, and the Chairman will report them to the meeting. Mr. Chairman, back to you.
Thank you, Lloyd. The first matter of business is to confirm the receipt of the financial statements and auditor's report, the consolidated financial statements of the company and subsidiaries for the year ended December 31st 2024, and the reports of the directors and auditors thereon have been mailed to all shareholders who requested them together with the notice of the meeting. The financial statements are also available on our website, or you can request paper copies by phone or email. The next matter is the election of directors, and the nominees of management of the company were identified in the information circular mailed to each shareholder of the company. I introduced the directors earlier, and I had them stand. Will someone please nominate the directors? Ten directors are required to be nominated.
Mr. Chairman, my name is John Blanchette, and I'm a shareholder of the company. I nominate David Harquail, Paul Brink, Tom Albanese, Hugo Dryland, Derek Evans, Dr. Katherine Farrell, Maureen Jensen, Jennifer Mackey, Daniel Malchuk, and Jacques Perron as directors of the company to hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed.
Thank you, John. Will someone please second that nomination?
Mr. Chairman, my name is Eric Karrandjas, and I'm a shareholder of the company. I second the nominations.
Thank you very much. Appreciate that. Are there any questions from the floor? Are there any questions on the webcast? There are no more questions. I declare the nominations closed. The next matter of business is the appointment of the company's auditors. Will someone please move on a resolution for the appointment of auditors and to authorize the directors to fix their remuneration of such auditors?
Mr. Chairman, my name is Christian Thatcher, and I'm a shareholder of the company. I move that PricewaterhouseCoopers LLP Chartered Accountants be appointed auditors of the company until the next Annual Meeting at such remuneration as may be fixed by the directors of the company. The directors here being hereby authorized to fix such remuneration.
Thank you. Could I get someone to second that motion?
Mr. Chairman, my name is Boris De Vries, and I'm a shareholder of the company. I second the motion.
Are there any questions from the floor? Any from the webcast? The next matter of business is the say-on-pay advisory resolution. Since the vote is advisory, it will not be binding on the board. However, the board will consider the outcome of the vote as part of its ongoing review of executive compensation matters. Will someone please move a resolution on the say-on-pay advisory resolution? Please.
Mr. Chairman, my name is Nalinie Mahon, and I'm a shareholder of the company. I move that on an advisory basis and not to diminish the role and responsibilities of the board of directors of the company, the shareholders accept the approach to executive compensation as disclosed in the company's management information circular dated March 20th 2025.
Thank you for that resolution. Could I have someone second that resolution?
Mr. Chairman, my name is Matt Begeman. I'm a shareholder of the corporation. I second the motion.
Thank you very much. Are there any questions from the floor via the webcast? That was the final item of formal business for the meeting. If you've not voted yet or on the motions that have been tabled, I'll ask you to complete your voting, and we'll pause briefly for the final votes to come in, and Lloyd will let me know when I can proceed. I declare the voting is closed, and we ask the polls to be closed. For those using physical ballots, please raise your hand, and Computershare will collect those and tabulate the preliminary results of the voting. I see no physical ballots. Are there any other items of business that any shareholder would like to raise? Anything in the webcast?
No.
The formal business of the meeting has now been completed. As I mentioned earlier, we had a lot of proxies that came in early, so we have received the preliminary results, and we declare that each of the motions of the meeting have been carried by the votes cast, including the election of directors. I declare the persons nominated have been duly elected as directors of Franco-Nevada Corporation. The final results of the meeting were reported on SEDAR, and they are quite good. Congratulations, directors. I have done the boring part, so now I am going to pass it over to Paul Brink, our President and CEO, to have some fun here, and he will provide his remarks and take your questions.
Good afternoon, everyone. Let's see if I can operate the technology. Not quite sure where to point the pointer.
Jason, can you advance it or—yeah. There we go. Good now.
Please heed the cautionary statement. I will be making forward-looking statements. Franco-Nevada is blessed with a wonderful business model. Our top-line royalties and streams provide exposure to, first of all, the gold price, which has been a terrific investment. Second, to the most predictable thing in the mining industry, and that is that every year across the great mines of the world, as they mine deeper in the pits or as they mine deeper in the underground, they expose more and more ore. Our royalties and streams expose you to that resource optionality. Third, so much of the reason that we invest in gold is as a hedge against inflation. Our top-line royalties and streams are protected against the cost inflation that so easily can eat into those returns over the long term. Our business has a leading track record.
As David mentioned, we're coming up on 18 years since our original IPO. During that period, it doesn't matter if it's revenue, adjusted EBITDA, operating cash flow, income per share, we've grown the business six and a half times. That has translated into tremendous returns for shareholders. The CAGR over that period is close to 16% per annum. That outpaces any of our peers. It outpaces any of the relevant benchmarks, the high-flying NASDAQ, the S&P 500. Gold itself has returned about 8% per annum over that period, so we've doubled the returns that you could have got just holding gold on its own. Other than those capital gains, we've also provided fantastic dividends to our shareholders. We've got a record every single year. We've increased the dividends. In total now, we've paid $2.5 billion of dividends. I always think of that number in terms of our original IPO.
When we IPO'd this company 18 years ago, we bought these assets for $1.2 billion. We've paid out more than double that now in terms of dividends. We say to our shareholders, the longer you hold our stock, the higher the dividend yield. For those that bought the stock at IPO, the yield in U.S. dollars is just short of 10%, in Canadian dollars, getting close to 14% yield. We pay a lot of attention to making sure that we invest in good mines. By good mines, we mean mines that treat the environment well, mines that treat the communities well to make sure that they're net benefits to the communities. Good governance has always been the heart of our company. What we believe is at the core of good governance is ownership. Management and the board own more than $200 million of stock ourselves.
We think that alignment is what ultimately drives that good governance. We're very pleased that our efforts are recognized by the rating agencies. We receive top ratings from all of the agencies, and in particular, are the very top-rated gold stock globally by Sustainalytics, probably the leading agency in the area. Both of the original iteration of Franco, which was public for 18 years, and in this new iteration of Franco, where we're approaching that, we've accumulated the broadest portfolio of royalties and streams in the industry. In total, 430 assets that span the best mineral belts across the world. That is a very balanced and diversified portfolio. Our commitment to our shareholders is we will keep the portfolio at least 70% in precious metals, but I've always asked for some latitude that we're going to also invest in diversified commodities.
We found that provides us more opportunities over time to provide better returns to investors. We've done very well in the oil sector. We've done very well with our iron ore investments to create a balanced portfolio. The geography is principally in the Americas, Canada and the U.S.A., where many of our original royalties are. Many of our big streams are in the good mining countries in South America: Chile, Peru, Brazil, Mexico is where our big assets are located. Amongst our assets, well-diversified, none of our assets is currently above 15% of our portfolio. We have two major types of assets: royalties. Many of our royalties are on gold assets. Gold assets, typically, you don't drill up much of the reserve over time. The good and the bad of that is you don't have great visibility of what happens over the long term, but it provides tremendous optionality.
It means as you mine deeper in those deposits, you can often receive a multiple return on what your original investment is. Streams typically are in big copper assets, and we buy in the base of the precious metal byproduct that comes out of some of the world's biggest copper mines. Copper mines tend to be much bigger than gold mines. The beauty of them is you often have visibility: 30, 40, 50 years of reserves and resources. We love those assets. They provide a very stable foundation for our business. We can buy the gold royalties knowing that often what you need for those gold options to mature is time. We know Franco-Nevada will be in business 50, 70 years from now. We have assets that will be cash flowing. That combination of steady cash flows with high optionality royalties, we think, is a great business combination.
Key with all of these investments, and we're actively always growing the business. It's easy to grow the business if you just buy assets at any cost. The key, obviously, is making profitable investments, and that is core to our DNA, making sure every deal that we do gets our share price higher. I've got on the chart here some of our larger stream investments, and you'll see on most of them we're getting tremendous returns. On most of those assets, the investment, the blue there is what we paid upfront. The return in gold is showing what we have already received back. You'll see on most of these investments we have already received our money back. The gray going forward is the future NAV of these assets. That's the future value that we will still receive.
You can see that we will make a multiple of our money on all of these investments. Turning back to the royalties and the gold royalties, as I say, they can have even greater optionality than you get on those streams. It's very hard. You never know what that will be in the future. We love this chart. It's probably the best indication of what's happened in the past. What it shows is the portfolio royalties that we bought coming out of Newmont 18 years ago at the time had 34 million oz in reserves. If you look forward today, those assets have more than 120 million oz, plus what's been produced in between. There's a 3.6x increase in the amount of ounces that have been attributable to Franco-Nevada. Those are the sort of returns that we can receive from our gold royalties.
Where are we today and what are the growth prospects of the company? This is our actual GEOs, gold equivalent ounces, that we received last year. We give one-year guidance. We also give a five-year outlook. We are showing the five-year outlook, 2029. You can see there is 10%-15% growth in the business looking out over that five-year period, most of that from assets that are already under construction. We can do far better than that. As many of you know, our largest asset, a number of years ago, suffered a setback, Cobre Panamá in Panama. It is currently shut down. The company that operates it, First Quantum, is currently in discussions with the government in Panama on the potential reopening of that mine. We are very hopeful that Cobre Panamá will come back into production again.
Cobre Panamá typically contributes about 130,000 oz-150,000 oz a year to our portfolio. That is about 30% more than what we currently receive today. If Cobre comes back, we can have very meaningful growth in that five-year time frame. On top of that, we have $1.7 billion of available capital. We have a very busy pipeline of deals. I am confident that we will be acquiring assets that will add even further torque to that growth profile. That is what you can see today and can contribute over a five-year period and the difference that we can make. We have assets that will contribute, but only over the longer term. In the gold there, you see the assets in the five-year outlook. That is our guidance for this year, roughly 500,000 oz. I spoke about Cobre. That is the prospect it will contribute within the next five years.
On top of that, we have a whole lot of assets, and a lot of those are interests and some of what we think will be the next generation of copper assets in the world. Some of those are royalties. Some of those are streams, gold streams. In total, in those ounces, they're about five, in those assets, they're about 5.2 million M&I royalty ounces. At today's gold prices of $3,000 per ounce, that's an incremental $17 billion of value that is sitting outside about five-year forecast. That's not all. In addition to that, we have some smaller advanced assets. We have another 224 exploration assets. We don't know if something will be discovered on that ground, but almost every year, something is. An example of that, one of those small exploration assets has been a discovery on in recent years. That's an asset called Rudna Glava.
is in Serbia. They have made a discovery of a copper gold system. They put out a first resource that was in the order of 6 million oz of gold equivalent. They updated that. It is closer to 7 million oz now. They have 8-10 rigs that are active on the property. This is one of those acorns. We had very little cost, perhaps hundreds of thousands. That is the sort of optionality that you get from that additional exploration potential. Lastly, how do we think about growing our business longer term? We have, over the last 18 years, always had an active pipeline. Many of those assets come to us. They are auctions, sometimes royalties that are for sale, sometimes companies that need to raise financing. We provide capital for the building of new mines in a stream process. Many of those are competitive.
We've worked over the last few years to say that's a good growth avenue, but how do we add to that growth avenue? We've taken a strategy to say, let's find really good teams that we can back, where we can be their financial backer, not just on a single deal, but with a relationship that we can help them grow their company over time that'll bring us repeat business. We dipped our toe initially with the Lundins in acquiring Candelaria from Freeport-McMoRan roughly a decade ago. Really, this strategy took hold three, four years ago with us financing the G Mining team. We provided them with stream financing. We provided them debt. We also were the lead order in their equity issue. We backed that team to build their first asset, Tocantinzinho. It's been a fantastic success.
They now have acquired their second asset, and we hope to participate in the journey as their financial backer. We've replicated that strategy with Discovery Silver. Tony Makuch is somebody who's well known to many in the sector. Again, a fantastic mine builder, mine operator. We backed Tony and his team acquiring the Porcupine assets coming out of Newmont. That deal has already received a tremendous market reception. The stock is up in the order of three times in a matter of months. We are looking forward to what Tony and his team can do. They have just closed that deal, taken ownership of those assets. That journey has just begun. With that, I will close my remarks and would love to take any questions from the floor. As a reminder, for those here in person, please raise your hand and a microphone will be brought to you.
If you're participating on the webcast, please type in your question or comment in the messaging section of the Lumi Platform, and Lloyd Hong will read the question aloud. Are there any questions from the floor? Yes. The microphone is coming along.
Small room, I think you still hear me.
I can. Although for the folks on the webcast.
Oh, yes. With respect to Panama, is your company in any way actively assisting in the negotiations with Panama? Are you taking a part in it?
In terms of those negotiations, we won't have a part. We have a very good relationship with the operator, First Quantum. We correspond with them very often. We've coordinated with them through this process. That negotiation with the government is their negotiation as the owner of the asset. We're purely a financier. We won't have a seat at the table.
My hand shakes a little bit on that one. Tony Makuch, very good.
That's excellent. Thank you.
Thank you.
Any further questions? I see one.
Which of your assets do you believe has the most potential for the company's growth?
That's like asking me which of my children I like the most. We have a whole suite of tremendous assets. I'll speak to one, though, because it's not yet producing asset. Once it comes into production, the value add can have a particular impact. That is the Cascabel asset in Ecuador. It's one of those you would have seen in that big chart. It is a copper gold development asset, one of the best discoveries in recent decades. High grade. It's an underground block cave target. We have agreed. We've provided some financing to move the pre-feasibility to a feasibility stage.
Once they make a construction decision, we would then provide a portion of the project financing to build that asset. It can be a really meaningful producer for our company in terms of the GEOs that would contribute. What they've scoped out as an initial mine plan in itself would be a tremendous project. It actually only comprises roughly 20% of the total resource that they've identified. Alpala is one of those assets that could produce for many decades and make a huge impact on our portfolio. I see a question in the back.
Hi. Have there been any updates on the CRA audits relating to the transfer pricing between the Barbados and the Mexico entities? There's a significant amount, I think, that has been held up by the CRA and that's been pledged by the company as security.
I lost my guess. And it ran out too.
Sure. Really no update at this time. We disclose what our potential exposure is. As you said, it's a significant amount. We actually haven't put that forward to CRA. We've made some small deposits associated with that. As to where we are right now, we are in a process where we've exchanged some information with CRA. Our goal is to resolve the issue as soon as we can. You are at the mercy of the CRA. I look at our fact pattern and the process we followed, and I'm confident that we'll get some sort of resolution.
Thank you. Does Franco-Nevada have a preferred stage where projects when you're evaluating investment opportunities?
That's a good question. I'm going to ask Eaun Gray, who's Chief Investment Officer, to answer that question.
Thank you for the question.
Why don't you stand up, Eaun?
Sure. Absolutely. In terms of the stage of development, we are open to projects all along the spectrum in terms of where they are. Key to us is the level of geological optionality. As Paul alluded to, we're looking for the best possible projects to expose our shareholders to that upside. In terms of actual dollars, however, I think we'll largely be focusing on those that are nearer to production. We are focused as a key pillar of our financing on project financing and also acquisitions, partnering with developers. Thank you.
Thanks. Your last deal, Paul, was the Discovery Financing, which was a full financing package. Going forward, do you anticipate that to be a strategy and an approach for other deals?
It was a very successful deal. As I laid out, absolutely. We would love to do more deals, not only with those groups.
Part of that strategy is to help those companies build their portfolios over time. We would love to do more transactions with them. We're also looking for more parties just like that. We think it's a strategy that can help grow our company as an additional avenue and would love to find other good teams to support. I don't see any more questions from the floor. Lloyd, are there any questions from the webcast?
We have one question on the webcast, Paul, from Sandy Rhind from Oaklins.
Is there any merit to Franco-Nevada financing the mining of Bitcoin given its limited quantity?
I'm not going to comment on Bitcoin or Bitcoin mining. Interesting question. What we found, our expertise, we have tremendous engineers. We've got tremendous geologists.
Our skill set is identifying what is in the ground, what can be mined economically, and also looking at all bodies and making the bets to think which of them have the greatest exploration potential. We will stick to our guns and make sure that what we do leverages our core competence. No more questions from the webcast. Before we close the meeting, a reminder that we will be releasing our Q1 results later today and a press release should cross the wire early this evening. We hope you are able to join us for our Q1 conference call, which is scheduled for 8:00 A.M. tomorrow morning. For those of you that are here in the room, we will have refreshments just outside. I hope that you will join us and have a chance so that we can have a chance to meet you right after the meeting.
Thank you for your support of Franco-Nevada and have a good evening.