TSX:ALS | OTCQX:ATUSFFebruary 2020
BMO Global Metals and Mining Conference
TSX:ALS | OTCQX:ATUSF
This document includes certain statements that constitute “forward‐looking statements” and “forward-looking information” within the meaning of
applicable securities laws (collectively, “forward‐looking statements”). Forward-looking statements include statements regarding Altius Minerals
Corporation’s (“Altius”) intent, or the beliefs or 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 may relate to future outlook and anticipated events or results.
By their very nature, forward‐looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and
the risk that predictions and other forward‐looking statements will not prove to be accurate. Do not unduly rely on forward‐looking statements, as
a number of important factors, many of which are beyond Altius’ control, could cause actual results to differ materially from the estimates and
intentions expressed in such forward‐looking statements.
Forward‐looking statements speak only as of the date those statements are made. Except as required by applicable law, Altius does not assume
any obligation to update, or to publicly announce the results of any change to, any forward‐looking statement contained herein to reflect actual
results, future events or developments, changes in assumptions or changes in other factors affecting the forward‐looking statements.
Forward Looking Statements
TSX:ALS | OTCQX:ATUSF
$6M$28M $33M
$47M
$67M$78M
FY 2014 FY 2015 FY 2016 FY 2017 2018 2019
Growth Track Record
80% EBITDA Margin $0.48 to $1.44
3
Royalty Revenue
5yr Growth in EBITDA/Share
$0.22$0.88 $0.83
$1.08
$1.56$1.84
FY 2014 FY 2015 FY 2016 FY 2017 2018 2019
Royalty Revenue Per Share
TSX:ALS | OTCQX:ATUSF
Royalty Growth Pipeline
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Strong operating margins and long resource lives motivating multiple new build and expansion investments by operators = free royalty growth
Organic (Free) Mine Royalty Growth
New renewable energy royalty business growing fast as electricity generation transition accelerates and sector begins to recognize benefits of royalty finance offering
Renewable Royalty Business Gaining
Momentum
Discovery
Renewable Development Portfolio
2.5 GW Portfolio
Rocanville
Cory
Allan
Vanscoy
Esterhazy
Completed Potash Expansions
New Mines in Construction
Voisey’s Underground
(Ni-Co-Cu)
Gunnison (Copper)
BuildingRamping UpFinancing
and Development
ChapadaExpansion (Cu)
Resource Stage Expansion Study
Expansion of Existing Assets
New Build Studies168,000 metres of
drilling in 2020
60+ Exploration Stage Royalties
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TSX:ALS | OTCQX:ATUSF
$22M$33M
$54M $54M$11M
-$3M -$6M
$17M
April 2016 April 2017 December2018
December2019
Proven Equity/Royalty Investment Strategy Allows Creation of New Pipeline Royalties at Negative Cost and Provides Cash for 3rd Party Royalty Acquisitions
5
PG Business Growth - Royalty Creation At Negative Cost
57 Projects
$17M
Converted to new royalties and junior equities since 2016 market
bottom
Positive cash generation in 2019
Junior Equity Portfolio Growth
PG Net Monetizations
1stGunnison starting up to mark first
PG created royalty to reach production stage
Altius generates mineral exploration projects for sale in exchange for royalties and equity positions
TSX:ALS | OTCQX:ATUSF
Levelized Cost of Energy Comparison
Renewables Transition Momentum Growth
EV Battery $ Cost / kWh
$ Cost Parity with Internal Combustion Engine
Electrification trends (e.g. transportation about to shift to EV) will
cause demand for electricity to grow and gain market share
relative to other sources of consumer energy such as fossil fuels
Lower costs, higher efficiencies and underlying demand growth
coupled with a surge in ESG investment mandates creating a
massive tailwind for renewable energy investments
Megatrends driving increased electricity demand:
ESG Going Mainstream:
6Source: “Electrifying Insights: How Automakers can Drive Electrified Vehicle Sales
and Profitability,” McKinsey – January 2017 , Lazard’s Levelized Cost of
Energy Analysis – Version 13.0 (November 2019), US SIF Foundation
Within the electricity sector, renewable energy has
become the cheapest form of new generation
Past the tipping point:
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TSX:ALS | OTCQX:ATUSF
Renewable Royalty Growth -Tri Global Energy Investment
• 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 in 2020
• First royalty project, Canyon Wind (360 MW – TX), sold in October 2019 to private equity firm with operations expected to
begin in H2 2021
• Woodford Wind (300+ MW – IL) sold to Copenhagen Infrastructure Partners in December 2019 with commercial production
anticipated in late 2021
• TGE development pipeline has increased to over 2,500 MW (even after accounting for the 660+ MW project sales to date)
7Source Company Reports
7
TSX:ALS | OTCQX:ATUSF
Diversity
Diversified Portfolio
15 Producing Royalties
Investment Grade Operators
Low Jurisdictional Risk
Royalty vs. Stream Dominated
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Copper 37%
Battery Metals (Ni-Li-Co) 2%
Potash 19%
Electricity Generation (Coal) 14%
Premium Iron Ore 20%
Steel Making
Coal 4%
Zinc 3%
2019CommodityRevenue
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TSX:ALS | OTCQX:ATUSF9
Industry leading fundamental business growth from assets that enable the world to meet its sustainability objectives
Coal to RenewablesFossil Fuel to Clean Energy
Conversion
Cu, Co, Ni, Li
Clean Iron Ore Products
Lower Emission Steel Making
Soil Quality/Agricultural Yield Improvements
Transportation Electrification
Potash
Macro-TrendAltius
Royalty Exposure
Subsidiary Altius Renewable Royalties Corp. (“ARR”) reinvesting royalty based capital to advance more than 23 GW of potential new renewable energy projects – as our 5 GW coal generation exposure phases out to zero
Altius’s potash fertilizer royalties relate to a portfolio of top-tier Canadian mines that are ramping up into pre-built capacity expansions as sustainable food production needs increase
Copper, which benefits more than any other metal from EV and renewable transitions, is Altius’s largest royalty exposure. Royalty exposure to battery metals - Nickel, Cobalt and Lithium is growing
Royalty from IOC relates to high iron / low impurity concentrates and pellets that require less metallurgical coal usage in steel plants
Portfolio Aligned with Global Sustainability Trends
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Sustainability
TSX:ALS | OTCQX:ATUSF
Longevity
Mine lives calculated based on current mineral inventory and 2018 throughput. Coal asset lives denote the expected plant closure and not based on
reserves. The 2018 revenue weighted average mine life is based on remaining reserves inclusive of MI resources and throughput capacity.
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85+ Year Revenue Weighted Life
TSX:ALS | OTCQX:ATUSF11
Durability
Notes:• All amounts USD. Spot as at February 22, 2020. Spot Potash is FOB Midwest.• Chapada margin calculated using Lundin’s guidance of 2020 C1 cash costs of copper per pound (NI43-101 report October 10, 2019) after precious metal by-product
credits. Chapada cash costs do not include the effects of copper stream agreements which will be a component of the copper revenue and will impact realized revenue perpound.
• Nutrien and Mosaic per tonne margins calculated by taking FOB Midwest Spot over Cost of Product Manufactured. COPM = Potash COGS for the 2019 excludingdepreciation and amortization expense and inventory and other adjustments divided by the production tonnes for the period. For Mosaic, we used the 2019 four quarteraverage actuals cash costs of production (excluding brine) – MOP ($/tonne)
• Voisey’s Bay margin calculation using SNL Modeled Cost Curve for Total Cash Cost per pound of nickel net of by-product credits.• IOC margin based on Altius modeled $45/t cash costs for concentrate and $65/t cash costs for pellet.• Gunnison is expected to be in commercial production in 2020. Total cash cost pe pound of copper is derived from the Base Case of the Feasibility Study dated January 16,
2017• Manitoba Operations margin calculated using Hudbay’s annual actuals year ended December 31, 2019. Cash cost per pound of copper produced, net of by-product credits.
Operator MineCommodity
BenchmarkSpot Price Operating Margin
Lundin Chapada Copper $2.59 114%
Nutrien All Operations Potash $265 223%
Mosaic All Operations Potash $265 258%
Vale Voisey's Bay Nickel $6.01 107%
Rio Tinto IOC Fe Concentrate $95 111%
Rio Tinto IOC Fe Pellet $135 108%
Excelsior Gunnison Copper $2.59 198%
Hudbay Manitoba Operations Copper $2.59 717%
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TSX:ALS | OTCQX:ATUSF12
TSX: ALS | OTCQX: ATUSF
Issued Common Shares 42.1 million
Fairfax Preferred Securities 10.0 million ($100 mm)
Basic Market Capitalization $455 million
Annual Dividend $0.20 per share
Outstanding Debt $109 million
Cash and Public Equity Holdings† $169 million
Available Under Credit Revolver† $85 million
4.9x
1.3x
x
1x
2x
3x
4x
5x
6x
2014 2015 2016 2017 2018 2019
Net Debt to EBITDA
4.9x
1.3x
x
1x
2x
3x
4x
5x
6x
2014 2015 2016 2017 2018 2019
Net Debt to EBITDA
Leverage Ratio
Dividends
$3M
Dividends
$5M
Dividends
$7MDividends
$7M
Dividends
$8M
Share buy back
$2M
Share buy back
$2M
Share buy back
$5MShare buy back
$9M
2015 2016 2017 2018 2019
Returns of Capital
Research Coverage
Richard Gray
Craig Hutchison
Brian MacArthur
Carey MacRury
Jacques Wortman
Orest Wowkodaw
Capital Structure
Capital table values, return of capital and net debt to EBITDA numbers as of Dec 31 2019 except for market cap as of Feb 20 2020. Cash and public equity holdings includes $22 million cash + $93 million LIORC equity value + $54.1 million project generation equity values
TSX:ALS | OTCQX:ATUSF13
0.9x 1.1x 1.5x
1.7x 2.0x
2.4x
ALS OR SSL WPM RGLD FNV
10.2x
16.8x 18.0x 18.2x 19.5x
27.2x
ALS SSL RGLD OR WPM FNV
11.2x
18.0x 19.6x 20.1x 20.6x
29.6x
ALS OR SSL WPM RGLD FNV
EV/EBITDA (2020E) P/CF (2020E)P/NAV
Source S&P Capital IQ, Company Reports. February 14, 2020
Potential Re-rate Catalysts
• Increased recognition of sector leading per share business growth metrics, longest duration assets, decreasing
leverage and increasing returns of capital
• New renewables royalty investment announcements
• Coal to renewables strategy execution eliminates current negative impact on investment suitability perception
• Broader portfolio sustainability attributes become recognized by ESG focused investors
• Announcements by mine operators of resource growth and mine expansion (e.g. Chapada)
Valuation
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TSX:ALS | OTCQX:ATUSF
Thank You
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PRODUCING
ROYALTIES
DEVELOPMENT
ROYALTIES
PROJECT GENERATION
PROJECT
RENEWABLE ENERGY
PORTFOLIO
CONTACT
INFORMATION
Flora Wood
Director, Investor Relations
Phone: (416)346-9020
Email: [email protected]