September Presentation Cautionary Statement Forward-Looking - PDF document

September Presentation

Cautionary Statement Forward-Looking Statements This Presentation contains "forward-looking statements", which may include but are not limited to, statements with respect to future events or future performance, management's expectations regarding Franco-Nevada’s growth, results of operations, estimated future revenues, costs and timing of acquiring new royalties, equity and other resource related interests, requirements for additional capital, mineral reserve and resources estimates, production costs and revenue, future demand for and prices of commodities, expected mining sequences, business prospects and opportunities. All statements, other than statements of historical fact, are forward-looking statements. The words "expects", ”expected”, “estimated” and similar expressions identify forward-looking statements. 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. However, there can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Franco-Nevada cannot assure investors that actual results will be consistent with these forward-looking statements and readers are cautioned that forward-looking statements are not guarantees of future performance. Accordingly, readers should not place undue reliance on forward-looking statements due to the inherent uncertainty therein. 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 royalty revenue (gold, platinum group metals, copper, nickel, oil and gas); fluctuations in the value of the Canadian and Australian dollar, and any other currency in which the Company generates revenue, relative to the U.S. 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 or oil and gas properties; influence of macroeconomic developments; business opportunities that become available to, or are pursued by us; access to debt and equity capital; litigation; title disputes related to our interests or any of the underlying properties; operating or technical difficulties; risks and hazards associated with the business of development and mining, including, but not limited to unusual or unexpected operating difficulties, financial stress and other natural disasters or civil unrest. 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 on www.sedar.com, as well as our Annual and interim MD&A. 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-GAAP Measures Free Cash Flow, EBITDA and Royalty Revenue are “non-GAAP financial measures” which management believes are valuable indicators of the Company. These measures do not have any standardized meanings and are unlikely to be comparable to similar measures of other companies. For a reconciliation of these measures to various GAAP measures please see the Company’s current and historical Annual and Interim MDA disclosure found on the Company’s website and on SEDAR. 2

Franco-Nevada Leading gold royalty company Secure and profitable assets Goldstrike High free cash flow (1) margins Growing gold revenue Active acquirer with > $700m in Gold Quarry available capital Semi annual dividend increased to C$0.14 per share Part of S&P/TSX Composite Palmarejo Index with US$2.8B market cap (2) (1) Free Cash Flow is defined by the Company as operating income plus depletion and 3 depreciation, non-cash charges, and any impairment of investments and royalty interests (2) As at Sep 1, 2009

Quality Portfolio Diversified & Geopolitically Secure Assets % of Royalty Revenue (1) 66% 20% >300 Royalty Assets Worldwide with Majority of Royalty Revenue from US & Canada (1) Royalty Revenue is defined by the Company as cash received or receivable from operating royalty assets 4 earned during the period. Percentages above are for the 3 month period ending June 30, 2009.

Quality Portfolio Balanced Growth Profile BASE GROWING FUTURE UPSIDE GOLDSTRIKE PALMAREJO DETOUR >145 EXPLORATION GOLD QUARRY TASIAST PERAMA HILL INTERESTS STILLWATER HOLLISTER PINSON >100,000 OIL & GAS HEMLO PANDORA ACRES OF MARIGOLD ROSEMONT UNDEVELOPED O&G LANDS ROBINSON FALCONDO ARCTIC GAS OTHERS… HOLLOWAY OTHERS… >20 ESTABLISHED ~4 PROJECTS THAT ARE ~15 MINERAL PROJECTS OPERATING MINERAL UNDER DEVELOPMENT POTENTIALLY PROPERTIES AND >100 OR EXPANDING OPERATING WITHIN 5YRS O&G OPERATIONS PRODUCTION Balanced portfolio of operating & future growth assets 5

Quality Portfolio Gold Focus with Added Optionality 45 40 35 30 ($ millions) 25 20 15 80% 56% 55% 77% 55% 10 61% 5 0 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Gold PGM Base Metals & Other Oil & Gas Increasing precious metals contribution in absolute & relative terms Chart reflects Royalty Revenue, defined by the Company as cash received or receivable from operating royalty 6 assets earned during the period.

Quality Portfolio Solid Assets with Quality Operators Goldstrike outperformed guidance for the first half of 2009 Goldstrike - Barrick Contribution from Palmarejo minimum payments beginning in Q3/09 Palmarejo - Coeur Oil & gas assets performing ahead of expectations Weyburn - Encana Potential to increase reserves and mine life at Gold Quarry through West Wall layback 7 Gold Quarry - Newmont

Quality Portfolio Future Growth Assets Property Royalty Operator Update Tasiast 2% NSR Red Back Mining Reserves and resources have been rapidly expanded with resources now >4 Moz* Hollister 3-5% NSR Great Basin Gold Recent discovery on 5% royalty ground. Hemlo 3% NSR & Barrick Gold Underground development and mining on 50% NPI royalty ground could begin in 2010. Detour 2% NSR Detour Gold 13.2 Moz* in-pit gold resource with pre- feasibility study in late 2009 Perama Hill 2% NSR Eldorado Gold Pre-Environmental Impact Assessment &Technical Report to be submitted Q3/09 Holloway/ 4% NSR & St. Andrew Financing completed for near-term Hislop variable production Other Various Various Pinson, Pandora, Rosemont, Falcondo, Dee/Arturo, Duketon, Kirkland Lake 8 * Resources stated in Franco-Nevada 2008 AIF

High Margin Business Free Cash Flow in All Likely Scenarios Free Cash Flow (1) By Quarter $35.0 85% $30.0 85% $25.0 $20.0 Millions Royalty Revenue (1) Free Cash Flow (2) $15.0 $10.0 $5.0 $0.0 Q1/09 Q2/09 (1) Free Cash Flow is defined by the Company as operating income plus depletion and depreciation, non-cash 9 charges, and any impairment of investments and royalty interests

High Margin Business Royalties Limit Downside Exposure Commodity and exploration exposure with less downside 10

High Margin Business Undervalued Free Cash Flow per Share Free Cash Flow per $1,000 Investment (1) Assumes Franco’s >$500m not invested 11 (1) Source: CIBC Equity Research. Calculations based on 1H 2009 actual results, annualized. FCF is represented by operating cash flow less capital expenditures.

Growth Through Acquisition Track Record $103.5 million $80 million Dec 29, 2008 Jan 21, 2009 7.29% gross royalty at 50% gold royalty stream at Gold Quarry, Nevada Palmarejo, Mexico March 30, 2009 Update: April 2009 Update: First gold poured Increased minimum guidance to 14,400 oz/annum Precious metals now 80% of Royalty Revenue 12

Growth Through Acquisition Growth in Gold Revenue Palmarejo 2009 (1) Palmarejo 2010+ (2) 9.0 8.0 Palmarejo Royalty Revenue 7.0 Potential 6.0 Gold Minimum Capacity US$ (millions) Price 5.0 $800/oz $20m $24m 4.0 $900/oz $25m $30m 3.0 $1000/oz $30m $36m 2.0 1.0 - Q1/09 Q2/09 Q3/09 Q4/09 Actual/Minimum Potential (1) Royalty revenue chart reflects actual revenue in Q2/09 and forecasted revenue for Q3/09 & Q4/09 based on a minimum payment obligation of 25,000 oz for 2H 2009 and Coeur’s production guidance of 72,000 in 2009 (assuming equal quarterly production). Revenue is calculated using a $900/oz gold price. (2) Minimum payment calculated on 50,000 oz above $400/oz. Capacity based on 50% of Coeur guidance from 13 Mar 30, 2009 of 120,000 oz/yr above $400/oz