TSX: ALS | OTCQX: ATUSFaltiusminerals.com/storage/presentations/altius... · 9/14/2020 ·...

|2TSX: ALS | OTCQX: ATUSFTSX: ALS | OTCQX: ATUSF

FORWARD LOOKING STATEMENT

This document includes certain statements that constitute “forward”looking statements” and “forward-looking information” within themeaning of applicable securities laws (collectively, “forward”lookingstatements”). Forward-looking statements include statementsregarding Altius Minerals Corporation’s (“Altius”) intent, or the beliefsor current expectations of Altius’ officers and directors. Such forward-looking statements are typically identified by words such as “believe”,“anticipate”, “estimate”, “project”, “intend”, “expect”, “may”, “will”,“plan”, “should”, “would”, “contemplate”, “possible”, “attempts”,“seeks” and similar expressions. Forward” looking statements mayrelate to future outlook and anticipated events or results.

By their very nature, forward” looking statements involve numerousassumptions, inherent risks and uncertainties, both general andspecific, and the risk that predictions and other forward-lookingstatements will not prove to be accurate. Do not unduly rely onforward-looking statements, as a number of important factors, manyof which are beyond Altius’ control, could cause actual results to differmaterially from the estimates and intentions expressed in suchforward-looking statements.

Forward-looking statements speak only as of the date thosestatements are made. Except as required by applicable law, Altius doesnot assume any obligation to update, or to publicly announce theresults of any change to, any forward-looking statement containedherein to reflect actual results, future events or developments,changes in assumptions or changes in other factors affecting theforward-looking statements.

Non-IFRS MeasuresAttributable revenue, adjusted EBITDA and adjusted operating cashflow is intended to provide additional information only and do nothave any standardized meaning prescribed under IFRS and should notbe considered in isolation or as a substitute for measures ofperformance prepared in accordance with IFRS. Other companies maycalculate these measures differently. For a reconciliation of thesemeasures to various IFRS measures, please refer to our ManagementDiscussion and Analysis.


ROYALTIES ONA SUSTAINABLE

NATURAL RESOURCE FUTURE

Subsidiary Altius Renewable Royalties Corp. (“ARR”) reinvesting royalties from phasing out coal mines to fund the development of a portfolio of more than 23 GW of new renewable energy projects through royalty financing

Macro-Trend

Fossil Fuel to Renewable Energy Transition

Electrification and Storage

Soil Quality/Agricultural

Yield Improvements

Lower Emission

Steel Making

AltiusRoyaltyExposure

Renewables Replacing Coal

Cu, Ni, Li, Co

Natural Potash Fertilizer

Clean Iron Ore Products

Copper, which benefits more than any other metal from EV and renewable energy transitions, represents our largest portfolio component. Royalty exposure to battery metals - Nickel, Lithium and Cobalt is beginning to ramp-up

Altius’s potash fertilizer royalties relate to a portfolio of top-tier Canadian mines that have pre-built capacity expansions as the need for sustainable food production increases

Royalties relate to high iron / low impurity concentrates and pellets that require less metallurgical coal usage in steel making – minimizing pollution and carbonimpacts

Industry leading fundamental business growth from assets that enable the world to meet its sustainability objectives.


DIVERSIFIEDASSETS ANDOPERATORS

Investment Grade OperatorsDiversified Royalty Production

Battery Metals3.5%

Potash

28.4%Electricity Generation (Coal)

9.9%

Other Royalties 16.7%

Renewable Electricity Generation

11.2%

Consensus NAV Breakdown†

High Quality Steel Inputs10.9%

Copper

19.4%

†Consensus NAV by asset grouped by primary September 14, 2020.


Leverage Ratio (Net Debt: EBITDA)Returns of Capital

CAPITAL STRUCTURE

†Capital table values, return of capital and net debt to EBITDA (trailing 12-months) numbers as of Jun 30, 2020 except for market cap as of Sep 11, 2020. Cash and public equity holdings includes $31 million cash (as at Jun 30, 2020) + $70 million LIORC equity value (as at Jun 30, 2020) + $48 million project generation equity values (as at Jun 30, 2020)

Issued Common Shares 41.5 million

Fairfax Preferred Securities 10.0 million ($100 million)

Basic Market Capitalization $440 million

Annual Dividend $0.20 per share

Outstanding Debt $147 million

Cash and Public Equity Holdings† $149 million

Available Under Credit Revolver† $35 million

Cormark Securities Inc

TD

Raymond James

Canaccord Genuity

Laurentian Bank Securities

Scotiabank

Richard Gray

Craig Hitchison

Brian MacArthur

Carey MacRury

Jacques Wortman

Orest Wowkodaw

TSX: ALS | OTCQX: ATUSF Research Coverage

2015 2016 2017 2018 2019 2020X

2014

Dividends$3M

2015

Dividends$5M

2016

Share buy back$2M

Share buy back$2M Share buy back

$5M

Share buy back$9M

Dividends$7M

2017

Dividends$7M

2018

Dividends$8M

2019

4.9x

2.2x3x

2x

1x

6x

5x

4x


TRACK RECORD

FY 2014 FY 2015 FY 2016 FY 2017 2018 2019

FY 2014 FY 2015 FY 2016 FY 2017 2018 2019

$6M

$3M

$28M

$1M

$33M

$15M

$46M

$26M

$67M

$35M

$78M

$44M

Revenues

Adjusted Operating Cash Flow

15 Producing Royalties

Copper 37%

Battery Metals 2%

Potash 19%

Zinc 3%

Steel Making Coal 4%

ElectricityGeneration (Coal) 14%

2019Royalty Revenue

High Purity Iron Ore 20%

2019Royalty Revenues $78.0M

|7TSX: ALS | OTCQX: ATUSF

PG BUSINESS GROWTHRoyalty Creation at Negative Cost

60 Projects

Converted to new

royalties and junior

equities since 2016

market bottom

Raised in 2020 by

companies partnered

with Altius

Altius generates mineral exploration projects for sale in exchange for royalties and equity

positions. This is a proven Equity/Royalty Investment Strategy that allows creation of new

pipeline royalties at negative cost and provides cash for 3rd party royalty acquisitions

Net Investments Net Monetization

April 2016 December 2019 June 2020

$33M

-$3M

April 2017

-$6M

December 2018

$1M

$54M $54M

$17M

$11M

$22M $48M

Junior Equity Portfolio Growth

>$85M


DRILLING EXPOSURE>$85mm Equity Raised and 130,000m of Drilling in 2020

Top 10 Drill Programs by Meterage within Altius’ PG Portfolio

50,000m

18,000m15,000m

14,600m

5,000m 5,000m 4,000m 3,000m 3,000m 3,000m

$35 M

$25 M

$13.3 M

$3.7 M$2.0 M $1.5 M $0.6 M

Equity Raised in 2020 by Altius’ PG Portfolio Companies

$4.5 M


Coal

ROYALTY LIVESUnrivalled Sustainability & Expandability

Weighted to 2019 revenue contribution levels our royalties have a potential weighted average remaining life of more than 121 years.

Mine lives calculated based on current mineral inventory and 2019 throughput. Coal asset lives denote the expected plant closure and not based on mineral inventory. The 2019 revenue weighted average mine life is based on remaining reserves inclusive of MI resources and throughput capacity.

Reserve Mine Life (Years) M&I Resource Life (Years) Inferred Resource Life (Years)

Chapada

Voisey’sBay

777

Gunnison

Sheerness

Genesee

Cory

Esterhazy

Allan

Rocanville

Vanscoy

25IOC

32

14

1

24 19

5

10

76

57

33

29

14

15

73

16

7

2

Total: 1,004 Years

Total: 129 Years

Total: 1,744 Years

Total: 1,433 Years

Total:309 Years

Several additional deposits identified.

Replacement: Conversion to long life renewable royalties underway> 700MW of project royalties created thus far.

Iron

Base Metals

Potash

+

+

+

+

+

M&I: 928Years

M&I: 57 Years

M&I: 928 Years | Inferred: 759 Years



Resource increased by 46% in the past 3 years with several exploration programs ongoing and capcity expansions understufy.identified.

Higher prices/ Lower cut-off grade potentially creates significant additional resource; Further expoloration potential.

Replacement: Gunnison; Curipamba development


Ramping Up BuildingFinancing

& DevelopmentExpansion

StudyResource

StageDiscovery

ROYALTYGROWTH

OPPURTUNITIES

Rocanville Cory Allan Vanscoy

Chapada Expansion (Cu)

Esterhazy

60+Exploration

Stage Royalties

Voisey’s Underground (Ni-Co-Cu)

Gunnison (Copper)

Organic (Free) Mine Royalty Growth

Renewable Royalty Business Gaining

Momentum

Strong operating margins and long resource lives (121years revenue weighted average) motivating multiple new build and expansion investments by operators = free royalty growth

New renewable energy royalty business growing fast as electricity generation transition accelerates and sector begins to recognize benefits of royalty finance offering

Completed Potash Expansions

New Mines in Construction

Renewable Development Portfolio

Expansion of Existing Assets

New Build Studies

168,000 metres of drilling in 2020


Renewable Royalties

ALTIUS


RENEWABLESTRANSITION

MOMENTUM GAINING

Source: “Electrifying Insights: How Automakers can Drive Electrified Vehicle Sales and Profitability,” McKinsey – January 2017 , Bloomberg NEF, Lazard’s Levelized Cost of Energy Analysis – Version 13.0 (November 2019),

Levelized Cost of Energy Comparison

Wind $41

Solar$40

$0

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

US

$ p

er

Me

gaw

attH

ou

r

(US$

/M

Wh

)

$0

2010 2015 2020 2025 2030

1,400

1,200

1,000

800

600

400

200

Observed prices 18% learningrate

2024 implied price $94/kWh

2030 implied price $62/kWh

Lithium-ion battery pack price (real 2018 $/kWh)

Past theTipping Point

Megatrends Driving Increased Electricity

Demand

Within the electricity sector, renewable energy has become the cheapest form of new generation

Electrification trends (e.g. transportation about to shift to EV)will cause demand for electricity to grow relative to other sources of consumer energy such as fossil fuels. Storage additions allow renewables to gain further grid based market share.

$350

$150

$100

$50

$200

$250

$300

Utility Scale SolarGas-Combine CycleNuclear

WindCoal


ARR DEVELOPMENT PROGRESS

ACCELERATING

Developed and refined renewable royalty structure and offering (legal, tax, etc.)

Silverpeak acquired Canyon Wind (TX) from TGE with 1st embedded royalty on a TGE project – 9/2019

CIP acquired Woodford Wind (IL) from TGE with 2nd embedded royalty on a TGE project –12/2019

Silverpeak acquired Flatland Solar (TX) from TGE with 3rd embedded royalty on a TGE project – 2/2020

Renewable Royalty Renewable Royalty Renewable Royalty Renewable Royalty

2017 2018 2019 2020

GBR formed and begins working on business concept with Altius –Q1 2017

Developed and refined renewable royalty structure and offering (legal, tax, etc.)

GBR acquired by Altius Minerals (through Altius Renewable Royalties) –2/2019

US$30MM royalty investment in Tri Global Energy (“TGE”) – 2/2019

US$35MM+ royalty investment in Apex Clean Energy – 3/2020

Formation Formation Acquisition Royalty Investment Royalty Investment


1360

1475

1175

1830

360

760940

TRI GLOBAL ENERGY INVESTMENT-

PROOF OF CONCEPT

• Renewable energy royalties are being generated ahead

of schedule – project sales in first year represent more

than half that required for full royalty vesting threshold

- with remainder expected throughout 2020

• First royalty project, Canyon Wind (360 MW – TX), sold

in October 2019 to Silverpeak Strategic Partners with

operations expected to begin in Q2 2021

• Woodford Wind (400 MW – IL) sold to Copenhagen

Infrastructure Partners in December 2019 with

operations expected to begin in Q4 2021

• Flatland Solar (180 MW – TX) sold to Silverpeak

Strategic Partners in March 2020 with operations

expected to begin in Q4 2021

• TGE development pipeline has increased to over 2,300

MW (even after accounting for the 940+ MW in project

sales)

Three Project Royalties Created To Date

1835

500

Cumulative Projects Sold Qualified Projects Early-Stage Projects Total Active Portfolio

11801180

475

Closing (02/2019) Q2 2019 Q3 2019 Q4 2019 9-Mar-20


APEX IS ONE OF THE LARGEST

RENEWABLE ENERGY DEVELOPERS IN US

21 GWDevelopment Portfolio

1.6 GWProject Transacted in 2019

+2.0 GWunder construction

Apex is one of the largest renewable energy developers in the U.S. and has commercialized over 5 gigawatt (GW) of clean energy projects since inception in 2009. Its current portfolio includes approximately 21 GW (12.5 GW wind, 8.5 GW solar) of development projects. Apex typically vends these projects to utilities, infrastructure funds and other institutional investors prior to construction.


Natural Resource Operator vs. Royalty Level Valuations

ARR

Currently in discussions with select strategic

investors to participate in a subsidiary level

equity capital raising in order to allow a more

rapid scaling of the business and to ensure

capture of first mover advantage

Also considering the public spin out of ARR as a

pure play renewable energy royalty business.

Source: Laurentian Bank Securities, Company Reports. May 5, 2020

Oil & Gas

+26

7.9x 10.0x 6.5x 10.2x 9.7x 24.6x

Average Royalty Lift +79%

+56 +154

Diversified

OperatorEV/EBITDA

11.6x

Precious Metals Renewables

Royalty EV/EBITDA

Market Value Potential?

?

TSX Renewable Energy and Clean Technology Index

$100

$120

$140

$160

$180

$200

2016 2017 2018 2019 2020


THANKYOU

Flora WoodDirector, Investor RelationsPhone: (416) 346-9020Email: [email protected]

Producing Royalties

Development Royalties

Project Generation

Renewable Energy Portfolio

mailto:[email protected]

TSX: ALS | OTCQX: ATUSFaltiusminerals.com/storage/presentations/altius... · 9/14/2020 ·...

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