J UNE 2011 P RESENTATION 1
Cautionary Statement Forward-Looking Statements Certain information contained in this presentation, including any information as to future financial or operating performance and other statements that express management's expectations or estimates of future performance, constitute "forward-looking statements". All statements, other than statements of historical fact, are forward-looking statements. The words “anticipate”, “plans”, “estimate", "expect", "expects", "expected" and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The Company cautions the reader that such forward-looking statements involve known and unknown risks, uncertainties and other factors that may ncertainties and contingencies The Compan ca tions the reader that s ch for ard looking statements in ol e kno n and nkno n risks ncertainties and other factors that ma cause actual financial results, performance or achievements of Franco-Nevada to be materially different from the Company's estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. These risks, uncertainties and other factors include, but are not limited to: fluctuations in the prices of the primary commodities that drive the Company’s Revenue (gold, platinum group metals, copper, nickel, uranium, oil and gas); fluctuations in the value of the Canadian and Australian dollar, Mexican peso, and any other currency in which the Company generates revenue, relative to the US dollar; changes in national and local government legislation, including taxation policies; regulations and political or economic developments in any of the countries where the Company holds interests in mineral and oil and gas properties; influence of macroeconomic developments; business opportunities that become available to, or are pursued by us; reduced access to debt and equity capital; litigation; title disputes related to our interests or any of the properties; development, permitting, infrastructure operating or technical difficulties on t d bt d it it l liti ti titl di t l t d t i t t f th ti d l t itti i f t t ti t h i l diffi lti any of the properties; rate and timing of production differences from resource estimates; risks and hazards associated with the business of development and mining on any of the properties, including, but not limited to unusual or unexpected geological formations, cave-ins, flooding and other natural disasters or civil unrest; integration of acquired assets. The forward-looking statements contained in this presentation are based upon assumptions management believes to be reasonable, including, without limitation, the ongoing operation of the properties by the owners or operators of such properties in a manner consistent with past practice, the accuracy of public statements and disclosures made by the owners or operators of such underlying properties, no material adverse change in the market price of the commodities, and any other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking statements because of the inherent uncertainty. For additional information with respect to risks, uncertainties and assumptions, please also refer to the “Risk Factors” section of our most recent Annual Information Form filed with the Canadian securities regulatory authorities at SEDAR on www.sedar.com, as well as our annual and interim Management’s Discussion and Analysis. The forward-looking statements herein are made as of the date of this presentation only and Franco-Nevada does not assume any obligation to update or revise them to reflect new information, estimates or opinions, future events or results or otherwise, except as required by applicable law. Non-IFRS Measures EBITDA, Adjusted EBITDA and Adjusted Net Income are intended to provide additional information only and do not have any standardized meaning prescribed by IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Definitions and reconciliations to IFRS can be found in our financial disclosures. These measures are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently. The following notes are standardized for the attached presentation. 1. EBITDA is defined by the Company as Net Income excluding income tax expense, finance costs, finance income and depletion and depreciation. 2 2. Adjusted EBITDA is defined by the Company as net income excluding income tax expense finance costs and income foreign exchange gains and losses gains and losses on investments Adjusted EBITDA is defined by the Company as net income excluding income tax expense, finance costs and income, foreign exchange gains and losses, gains and losses on investments, income/losses from equity investees, depletion and depreciation and impairment charges related to royalty and stream interests and investments. 3. Adjusted Net Income is defined by the Company as net income excluding foreign exchange gains and losses, gains and losses on investments, impairment charges related to royalties, streams, working interests and investments; unusual non-recurring items; and the impact of taxes on all these items. 2
Dow vs Gold: 45 40 32 35 16 30 Logarithmic Scale 25 DOW/Gold 8 20 4 15 10 2 Arithmetic Scale 5 1 0 Financial vs hard assets 3
Franco-Nevada A gold focused royalty & streaming company arejo generating growing cash flow and dividends Palma f from a diversified portfolio of quality assets di ifi d tf li f lit t � > 50% expected growth in 2011 Growth ke � World class discoveries World class discoveries Goldstri � >$500M available capital � 60% increase in monthly dividend 60% increase in monthly dividend Yi ld Yield � 1.3% yield Tasiast � Increases in each of past 4 years � Royalty and stream model Low Risk � Secure and diversified portfolio Sudbury � Protected from inflationary costs S 4
Business Model Benefits Gold ETF Franco ‐ Nevada Operators Yield 0% >1% 0 ‐ 1% >1 Leverage to Gold Price 1 >1 Exploration & Expansion Upside 0% 100% 100% Exposure to Opex, Capex & 0% 0% 100% Environmental Costs (NSR) Franco-Nevada provides yield and more upside th than a gold ETF with less risk than an operator ld ETF ith l i k th t 5
Current and Future Assets Over 200 mineral royalties and streams* *Does not include Franco-Nevada’s 135 oil & gas assets and 157 undeveloped oil & gas interests 6
Quality Operators & Assets Goldstrike Stillwater Bald Mountain East Boulder Hemlo Gold Quarry Tasiast Subika Subika Morrison Marigold Podolsky Musselwhite McCreedy West 7
Secure and Diversified (Q1 2011 Revenues) By Country By Asset Edson Australia 2% Weyburn 4% 4% 4% 4% Other O&G + Other Other Minerals 8% 6% 2% Sudbury Palmarejo Basin 26% US US 5% 38% Stillwater Mexico 9% 30% Goldstrike - NPI Ezulwini Ezulwini 8% 4% MWS Canada Gold Other 3% 17% 20% Marigold 4% Goldstrike - NSR 6% Gold Quarry 4% 88% from North America 86% from precious metals 8
Revenue Growth 80 70 60 Reflects 50 year end US$ (millions) Oil & Gas + Other top–up 40 payments 86% PGM precious 30 metals in metals in Q1 2011 Gold 20 10 ‐ Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2009 2010 2011 2011 Diversified portfolio with growing precious metals 9
First Quarter Revenue Growth 80 O&G + 70 other 60 PGM 50 50 ($ Millions) Gold 40 30 20 10 0 Q1 2008 Q1 2009 Q1 2010 Q1 2011 St Strong year-over-year growth th 10
Sources of Growth (Gold Revenue) 450% 400% 350% +332% +332% 300% 250% 250% G ld G ld Gold Gold Revenue Revenue 200% 150% 100% +71% +71% Gold Price Gold Price 50% 0% 0% ‐ 50% Q4'07 Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09 Q1'10 Q2'10 Q3'10 Q4'10 Q1'11 Growth from: ~20% gold price increase Growth from: ~20% gold price increase ~30% organic (expansions and start-ups from portfolio) ~50% new acquisitions 11
12 Growth in the Pipeline
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