Earnings call transcript: Franco-Nevada Q1 2025 beats forecasts, stock dips

Franco-Nevada Corporation reported robust financial results for the first quarter of 2025, surpassing analysts' expectations with an EPS of $1.09, compared to the forecasted $0.96. Revenue also exceeded projections, reaching $368.4 million against a forecast of $311 million. Despite the strong earnings performance, the company's stock saw a decline of 2.92% in regular trading, closing at $165.25, before experiencing a slight uptick of 0.91% in premarket trading. According to InvestingPro data, the company maintains impressive gross profit margins of 89.17% and has raised its dividend for 17 consecutive years, demonstrating consistent operational excellence. Current analysis suggests the stock is trading above its Fair Value.

Key Takeaways

• Franco-Nevada reported record quarterly revenue and net income.
• The company achieved a 43% year-over-year increase in revenue.
• Earnings per share significantly exceeded analyst forecasts.
• Stock price declined despite strong earnings, reflecting cautious market sentiment.
• The company remains debt-free with substantial available capital.

Company Performance

Franco-Nevada demonstrated a strong performance in Q1 2025, with record top and bottom-line results. The company reported a 43% increase in revenue year-over-year, driven by higher gold and silver prices. The adjusted EBITDA rose by 49%, reflecting efficient cost management and operational performance. The company sold 126,585 gold equivalent ounces (GEOs), marking a 3% increase from the previous year. InvestingPro analysis reveals the company's strong financial health with a current ratio of 22.9, indicating exceptional liquidity. For deeper insights into Franco-Nevada's performance metrics and 13 additional exclusive ProTips, consider exploring InvestingPro's comprehensive research report.

Financial Highlights

• Revenue: $368.4 million, up 43% year-over-year
• Adjusted EBITDA: $321.9 million, a 49% increase
• Adjusted net income: $205.6 million, or $1.07 per share, up 51%
• Total GEOs sold: 126,585, a 3% increase
• Net GEOs: 113,138, a 6% increase

Earnings vs. Forecast

Franco-Nevada's EPS of $1.09 exceeded the forecast of $0.96, representing a positive surprise of approximately 13.5%. The revenue of $368.4 million also surpassed expectations by 18.5%, indicating strong operational performance and favorable market conditions for precious metals.

Market Reaction

Despite the earnings beat, Franco-Nevada's stock fell by 2.92% in regular trading, closing at $165.25. The decline may reflect broader market trends or investor caution. However, in premarket trading, the stock showed a modest recovery, rising by 0.91% to $166.75.

Outlook & Guidance

Looking forward, Franco-Nevada expects to generate 47% of its annual revenue in the first half of the year, with 53% anticipated in the second half. The company is focused on acquiring high-quality royalty and streaming assets and anticipates a modest decline in energy asset volumes if prices weaken. With a market capitalization of $31.86 billion and a strong YTD price return of 40.89%, the company shows robust momentum. InvestingPro data indicates three analysts have recently revised their earnings estimates upward for the upcoming period, suggesting positive sentiment about the company's future performance.

Executive Commentary

"Today, we're reporting our best financial results ever," stated CEO Paul Brink, highlighting the company's record performance. CFO Sandy Branagh noted, "In a rising commodity price environment, we expect to benefit fully as the cost per GEO should not increase significantly."

Risks and Challenges

• Potential suspension of Cobre Panama arbitration could impact operations.
• Market volatility in commodity prices may affect revenue.
• Ongoing discussions and evaluations of transaction opportunities pose strategic risks.
• Energy asset volume decline if prices continue to weaken.
• Global economic conditions and geopolitical tensions could impact market demand.

Q&A

During the earnings call, analysts inquired about the potential suspension of the Cobre Panama arbitration and the company's strategy for future acquisitions in the gold sector. Executives emphasized their focus on maintaining a sustainable and progressive dividend strategy while continuing to evaluate transaction opportunities.

Full transcript - Franco Nev Corp (FNV) Q1 2025:

Jenny, Conference Call Operator: Good morning, and welcome to Franco Nevada Corporation's First Quarter twenty twenty five Results Conference Call and Webcast. This call is being recorded on 05/09/2025. At this time, all lines are in a listen only mode. Following the presentation, we will conduct a question and answer session, where you may ask a question through the phone line or webcast. If you are joining by webcast, you may submit a written question for the Q and A session at any time during this call by typing your question in the Q and A section of the webcast platform.

I would now like to turn the conference call over to your host, Candida Hayden, Senior Analyst, Investor Relations. Please go ahead.

Candida Hayden, Senior Analyst, Investor Relations, Franco Nevada: Thank you, Jenny. Good morning, everyone. Thank you for joining us today to discuss Franco Nevada's first quarter twenty twenty five results. Accompanying this call is a presentation, which is available on our website at franconevada.com, where you will also find our full financial results. The presentation is also available to view on the webcast.

During our call this morning, Paul Brink, President and CEO of Franco Nevada, will provide introductory remarks, followed by Sandy Branagh, Chief Financial Officer, who will provide a brief review of our results. This will be followed by a Q and A period. Our full executive team is available to answer any questions. Participants may submit questions by telephone or via the webcast. We would like to remind participants that some of today's commentary may contain forward looking information, and we refer you to our detailed cautionary note on Slide two of this presentation.

I will now turn over the call to Paul Brink, President and CEO of Franco Nevada.

Paul Brink, President and CEO, Franco Nevada: Thank you, Candida, and good morning, everyone. Today, we're reporting our best financial results ever. We achieved record quarterly top and bottom line results and that without any contributions from Cobre Panama. The results benefited from elevated gold prices, a good contribution from our Hemlo NPI and strong production from our energy interests. We're looking forward to added contributions through the year, in particular from the ongoing ramp up of Tokotazinho and Greenstone and the start up of Valentine Gold, as well as contributions from the new porcupine royalty.

On the topic of Cobre Panama, President Molino of Panama continues to indicate a willingness hold discussions about the mine this year, and we're encouraged by his recent statements in this regard. It was an active quarter for our community support program, and we funded contributions for a waste management initiative at Cascabell, Sogold the reopening of the Museum of Northern History in Kirkland Lake with the Nico Eagle and Almos and a contribution to the Sioux Saint the Sioux Area Hospital Foundation with Almos. During the quarter, we closed the previously announced $500,000,000 acquisition of a stream on Savanna Stillwater's Western Limb mining operations, and we received the initial payment, which relates to operations in the last four months of last year. We ended the quarter debt free and with $2,100,000,000 in available capital. And post quarter end, we closed the acquisition of a 4.25% NSR royalty for $300,000,000 with Discovery Silver on the Poker Blind Complex.

You'll recall, as part of that financing package, we also provided a $100,000,000 loan facility, and we had a roughly we provided a roughly CAD 70,000,000 lead order in their equity issue. Needless to say, we're delighted with the roughly tripling value of the shares from our purchase price. We remain well capitalized to add further growth, and our business development team have a number of actual opportunities that could add further attractive assets this year. With that, I'll hand the call to Sandy.

Sandy Branagh, Chief Financial Officer, Franco Nevada: Thanks, Paul. Good morning, everyone. As Paul mentioned, Frank and Nevada reported record financial results for first quarter ended 03/31/2025. This was the result of both strong production from our asset base and higher prices. Precious metal prices with gold in particular were very strong in first quarter.

On Slide four, you'll see a comparison of commodity prices for Q1 twenty twenty five and Q1 twenty twenty four. Gold and silver prices increased significantly year over year with the average gold price being higher by 38% in the quarter and average silver price being higher by 37%. Prices for palladium, iron ore and oil continued to be volatile and were lower compared to prior year. However, you did see a significant increase in natural gas prices. On Slide five, we highlight total geos sold and net geos sold for Q1 twenty twenty five, Q1 '20 '20 '4.

Total GEO sold were 126,585 in the quarter compared to 122,897 in first quarter twenty twenty four, a 3% increase. Precious metal geos sold in the quarter were $100,623 higher by 8% compared to prior year. For the quarter, we received strong contributions from Candelaria and benefited from the recent acquisitions made, Yanacocha and Western Lim Mining operations. As Paul mentioned, we did receive our first geos from Western Lim in the quarter, which were related to the production period September 1 to December thirty one of last year. GEOs related to January 2025 were delivered in April, and it's important to note there's a three month delay between production and delivery to Franco Nevada.

In addition to better performance from Candelaria and receiving GEOs from recent acquisitions, we also benefited from the continued ramp up of operations at New Mines, Toconsigno and Greenstone. I look forward to increasing contributions from these assets. One of the key outperformers versus our expectations was the Hemlo NPI. We did record a catch up accrual related to 2024 that was recorded in the first quarter, but the Hemlo NPI again showed its leverage to higher gold prices. Revenue recorded for the quarter was $17,700,000 compared to $4,800,000 a year ago.

Diversified geos sold were 25,962 for the quarter compared to $29,879 for prior year, despite diversified revenue being higher by 21% year over year, dollars 74,800,000.0 versus $61,600,000 The approximate 4,000 GEO sold reduction is due to the impact of higher gold prices when converting revenue to GEO. As we look at our royalty and streaming business, we think it's important to evaluate contributions from assets based on margin contribution and not necessarily top line measures. Royalty geos are higher margin geos as there's minimal cost associated with each versus stream GEOs where an ongoing fixed payment is required. The measure net GEOs removes the cost of sales component for all GEOs so that GEOs sold are represented after cost. For Q1 twenty twenty five, net GEOs were 113,138 for Franco Nevada, compared to $106,681 in Q1 twenty twenty four, a 6% increase.

I think it's important to note that when looking at our growth going forward, the majority of that growth comes from high margin royalty geos versus streams. As you turn to Slide six, we have highlighted our revenue and adjusted EBITDA results for the last five quarters. Total revenue for the quarter was $368,400,000 which is a record for Sanford, Nevada. This compares to $256,800,000 last year, a 43% increase. Precious Metals accounted for 79% of revenue.

Adjusted EBITDA, also a record, was 49% higher for the quarter at 321,900,000 compared to 216,100,000.0 in first quarter twenty twenty four. Slide seven highlights the key financial metrics used by the company. As mentioned, total GEOs were approximately $126,500 generating CAD368.4 million in revenue during the quarter. With respect to cost, we did have an increase in cost of sales compared to Q1 twenty twenty four due to higher stream ounces sold. Cost of sales was $38,500,000 versus $33,600,000 last year.

Depletion did increase as well to $68,400,000 versus $58,200,000 a year ago. Depletion is based on actual mining GEO sold and barrels of oil equivalent received from the Energy Division. As we received more GEOs from Candelaria and began depleting our recent transactions in Yanacocha and Western Lim mining operations, this impacted depletion as those assets are currently higher per ounce depletion assets. Adjusted net income was $205,600,000 or $1.07 per share for the quarter, both up 51% versus prior year. Slide eight highlights the continued diversification of the portfolio.

79% of our Q1 twenty twenty five revenue was generated by precious metals, with revenue being sourced 84% from the irons. Our largest contributor to revenue was Candelaria. Slide nine illustrates the strength of our business model to continue to generate high margins. For first quarter twenty twenty five, the cash cost per GEO, which is essentially cost of sales divided by gold equivalent assets sold, was $3.00 $4 per GEO. This compares to $273 per GEO in Q1 twenty twenty four.

As the gold price has risen, Franklin, Nevada has seen a significant increase in our margin per GEO, with it being over $2,500 per GEO in Q1 twenty twenty five. As we've always said, in a rising commodity price environment, we expect to benefit fully as the cost per GEO should not increase significantly. And lastly, Slide 10 summarizes the financial resources available to the company. When including our credit facility of $1,000,000,000 total available capital at March 31 is 1,900,000,000.0 However, this is net of the CAD 300,000,000 funded after quarter end for the porcupine royalty. The company remains well capitalized to continue to add long life, high quality assets to the portfolio.

And now I'll pass it back over to Jenny, and we're happy to answer any questions.

Jenny, Conference Call Operator: Thank C. Wainwright. Line is now open.

Paul Brink, President and CEO, Franco Nevada: Hey. Good morning, Paul, Sandeep and team. Happy Friday. Hi, Heiko. Likewise.

Sid, Analyst: You did the conversion of the net profit interest on Pandora into a net smelter return royalty. Out of curiosity, given current commodity pricing, is that something where you're getting more and more operators approaching you on some sort of conversion or amendment to streams? Because I was always under the impression that, you know, in general, once a stream is there, it sort of stays and it doesn't really get renegotiated. Is is there more obscene right now with people trying to do things given that a lot of the operators have more cash flow than they probably thought a year ago?

Paul Brink, President and CEO, Franco Nevada: I don't see a theme at the moment. That conversion was just a function of the transaction that we did. We still would at the time, and it did make more sense in doing that to convert that into an NSR, which is a more predictable instrument for us. So I'd say it's more just related to the particular transaction.

Sid, Analyst: Fair enough. So so we shouldn't expect anything else like this in q two and beyond, really.

Paul Brink, President and CEO, Franco Nevada: Yeah. No no conversions expected.

Sid, Analyst: Okay. And then something completely different. I I was there was an article in the Wall Street Journal a couple of days ago with Warren Buffett and his stake in Occidental Petroleum. And essentially, it's that the investment didn't really work out. In contrast, your U.

S. Energy interests actually did quite okay with, you know, obviously higher royalty rates in the Permian. Just want to see what have you been doing better. And given current pricing, what are you seeing with new royalty investments in in in that space?

Paul Brink, President and CEO, Franco Nevada: Sid, it's Jason O'Cong here. I don't think we have a similar interest as Oxy did. We are a passive investor in our royalties in The US, So we don't have the cost structure, etcetera, that Oxy would have and some of the performance issues that they may have had. I think our exposure in The US is fairly broad. We've got access to most of the major shale plays, including both the Permian and Anadarko on the oil side, as well as the Haynesville and Appalachia on the gas side.

So we're very well exposed, both in terms of our footprint in the different basins, as well as the different commodities. We are continuing to evaluate different opportunities in oil and gas. We look at good quality assets and world sectors as they become available. We'll continue to assess those. If there's something that is of good quality and value, we may look between that in the future.

Fair enough. Thank you, guys. I'll get back in queue.

Jenny, Conference Call Operator: Thank you. Your next question is from Cosmos Chi from CIBC. Your line is now open.

Cosmos Chi, Analyst, CIBC: Thanks, Paul, Sandeep and team, and congrats on the record earnings. It's well deserved. Maybe quick question first on the MPI at Hemlo. Sandeep, as you mentioned, there is a bit of a catch up in the quarter. So to confirm, we shouldn't expect the same sort of elevated level in terms of earnings from Hemlo for future quarters?

It'd still be good because as we know, MPI is very levered to higher commodity prices, but likely wouldn't be fit to the same sort of level.

Sandy Branagh, Chief Financial Officer, Franco Nevada: Yeah, hi Cosmos. Yes, so the catch up related to last year was about 5,000,000 US. So the Q1 MPIXONE was about 12,000,000 US. As you said, it's very hard to predict MPI's and especially at Hamelow where we don't cover the entire mine. We're just on one portion of the underground.

But at current commodity prices, you know, I'd expect something similar in terms of revenue unless something drastic happened. But as I said, you get the numbers, don't really know, but I think that's a fair estimate going forward.

Cosmos Chi, Analyst, CIBC: You know what, it's a good surprise. So I think that's a that's a positive. And then in terms of NPIs, as we talked about, very leveraged to higher commodity prices. If I scan through your portfolio, the other NPIs in in Kirkland Lake. So is there any way that you can kinda talk about, the potential here at the NPI at Kirkland Lake?

Because it didn't see the same degree in terms of increase in q one. So again, maybe it's just based on the area that you cover, but is there any more additional color that you can give us on the Kirkland Lake MPI?

Sandy Branagh, Chief Financial Officer, Franco Nevada: Sure. So the Kirkland Lake MPI is at 20% accounting profit MPI, but it's only on a couple of claims at Kirkland Lake where they're not mining right now. So we're not getting, but they had very good exploration results there and they're moving towards those claims. So in the years going forward, I do expect to start payments on those, but there won't be anything this year. The one NPI I will mention is Musselwhite, where we have a 5% NPI.

And with Orlet taking over that asset from Newmont, we're looking forward to seeing what they do with that asset in terms of more efficient mining, improving productivity and just both these higher commodity prices, just see how that plays out. So that is one where I think we do have some leverage.

Cosmos Chi, Analyst, CIBC: And the Musselwhite NPI, does that cover the entire property? Okay. That's that's good to know. Maybe switching gears just quickly on the Western Limb, the, you know, fairly recent acquisition. Could you maybe talk about the timing again in terms of I saw that you received 6,540 GEOs in the quarter, but that was for the four months ended last year.

So I would have expected it to be all the way to March or the end of q one in terms of payments. May again, maybe there's a lag. Could you walk me through the the timing in terms of, I guess, what what should we expect in terms of receipts in, say, q two and then Q3 for Cranford, Nevada into 2025?

Sandy Branagh, Chief Financial Officer, Franco Nevada: Sure. So what we received in Q1 was related to last year, for the last four months of the We didn't receive anything related to 2025. There's basically a one quarter lag. So January got delivered in April, February will be May. So as we guided to on an annual basis, it's roughly 20,000 divide that by four, so roughly 5,000 GEOs a quarter.

Cosmos Chi, Analyst, CIBC: Great. And then maybe one last question, bigger picture. Paul, you had kind of mentioned COVID Panama. But again, based on your point of view and your interpretation, maybe give us a bit more color in terms of what do you think is kind of happening in Panama, how that relates to COVID Panama. And as we all know, First Quantum discontinued their international arbitration process.

I think yours is still active. So maybe if you can talk a little bit about that as well.

Paul Brink, President and CEO, Franco Nevada: Maybe starting up, what is going on in Panama at the moment? You would have seen that President Molino for a while, has said he's open to a discussion on the mine this year. He did late in March give instructions to his team to say he he wanted them to turn turn their minds to how they might address the mine. The country has been completing the process on social security. They've also had to deal with The US in terms of the Panama Canal.

So those have all been items on the agenda. Very hopeful that negotiations can start fairly soon with the company. I was also encouraged by some comments that Molina had made to say he would like to see that they can get the situation with the mine resolved by year end. So I think that is the setup. In terms of of our own arbitration process and suspending, we have had discussions with representative of the government.

Those have been productive, but we don't have anything to report on that at this stage.

Cosmos Chi, Analyst, CIBC: Great. Thanks, Paul, Sandeep, and team. Those are all the questions I have. Have a good weekend.

Paul Brink, President and CEO, Franco Nevada: Thanks, Paul.

Jenny, Conference Call Operator: Your next question is from Daniel Major from UBS. Your line is now open.

Daniel Major, Analyst, UBS: Paul. Hi, Sandeep. Thanks for the questions. First one, just to follow-up again on Cobre Panama. Just looking at the commentary from Molina, I mean, I think he quoted that he's open to forming an association with First Quantum with respect to the new Cobre Panama license not being based on contract law, but he wants to see all arbitration suspended.

Is this something that the Panamanian government have approached you about dropping your arbitration claim to facilitate an engagement on the licensing agreement? Or is this just purely a negotiation between First Quantum and the government of Panama?

Paul Brink, President and CEO, Franco Nevada: Yes. In terms of the ownership, as you well know, it is First Quantum and also CoreS, the Koreans, who are the owners of the assets. So in terms of any negotiation, it's a negotiation with those parties. We're a financier to this project. We don't have a seat at the table.

As you've as I outlined and mentioned before, we obviously do have our arbitration rights. As I said, we have had some discussions with government representatives, but don't have anything to report on it.

Daniel Major, Analyst, UBS: Okay. So at this stage, you're not looking to drop your arbitration claim?

Paul Brink, President and CEO, Franco Nevada: Our discussions have been we're open to suspending it under the right conditions, And so we've had discussions around that.

Daniel Major, Analyst, UBS: Okay. That's useful. Thank you. And then the second question, quite strong performance from the oil and gas component of the portfolio this quarter. Can you give us a steer on the distribution of expected GEO sales from the diversified portion of the business through the balance of the year?

Paul Brink, President and CEO, Franco Nevada: I think in terms of the energy performance, we did have a strong quarter. Part of that was helped up by prices. The other piece was we had some strong performance in our Permian assets from new wells that came online during the quarter. Going forward, I expect that we'll see a reasonably flat profile, although it will depend on where prices go. You would have seen last year when the gas price was weak, some of our volumes on our gas assets came off as operators pulled back on activity.

We are waiting to see how the operators on our lands react to what has been a lower oil price. So you can expect that if prices stay lower for a longer period of time, there may be some reduction activity, which could translate into slightly lower volumes. So it is largely a function of price. If prices sort of stabilize in and around where they were last year, would expect a fairly flat profile. If prices continue to weaken, you may see some modest volume decline associated with a pullback in activity.

Daniel Major, Analyst, UBS: Okay, thanks. And then one more if I could, just thinking about your pipeline of projects and where your focus is at the moment. Can you give us any steer? Of the transactions have been more focused on gold assets in the space. Are you seeing any pickup in interest in the base metal space?

And has there been any negotiations in Argentina that you can make any comments on?

Ian Gray, Executive Team Member, Franco Nevada: Hi, Daniel. It's Ian Gray speaking. I would make the first overall comment that the gold market is very active in terms of royalties and streams. So we're spending majority of our time there and we're quite pleased with the conditions. There are opportunities outside of gold, relatively few compared to what we're seeing in gold, and no specific commentary I can provide on Argentina.

Daniel Major, Analyst, UBS: All right, thanks. Very useful. Have a nice weekend.

Paul Brink, President and CEO, Franco Nevada: Great, thank you.

Jenny, Conference Call Operator: Thank you. Your next question is from Tanya Jakusconek Your line is now open.

Tanya Jakusconek, Analyst: Great. Good morning, everybody. Congrats on a good quarter and good start to the year. And that HAMLO NPI is the one that just keeps on giving, so hard to forecast. Anyhow, Right.

I have three questions if I could. I'm gonna start with Sandy, just the easier one on just on the modeling side. So thank you for that modeling on the HEMLO. And also, I just wanted to have a little bit of an idea on how the overall profile for the company shapes out during the year. We had started obviously with a good Q1.

We had talked about a profile of 47% in the first half, fifty three percent in the second with a similar Q3, Q4. And that was based on the ramp up of some of the operations that Paul mentioned in the beginning of the presentation. Just wondering how that is that still what you're looking at based on what you know today?

Sandy Branagh, Chief Financial Officer, Franco Nevada: Yes, Tanya, I think that's a fair profile. The caveat is that the gold price has gone higher, like our guidance was done at $2,800 an ounce and close over 3,000 an And energy prices have pulled back from especially oil from where we had budgeted. Know, on an overall geo profile, I think that's fair. You'll probably you might see some of the gains on the mining side negated on the conversion when we're converting the diversified side. But for your modeling purposes, I still

Paul Brink, President and CEO, Franco Nevada: think it's a fair profile.

Tanya Jakusconek, Analyst: Okay. And just on the energy side, and I know we touched a little bit on it. Can you just remind me the lag in terms of pricing that are felt? I thought there was about a six month lag. Is that correct in terms of what they're doing today versus where you're going to see this in your financials?

Is it about six months?

Paul Brink, President and CEO, Franco Nevada: Tania, it depends on how you look at it. From a pure price impact, We get paid on our royalties typically, they range, but from anywhere from one month to maybe three months following production. So there's that impact. The other impact that I spoke about earlier is an impact to drilling activity. That is a longer lag.

Operators typically will want to see where prices are going to sort of flatten out a little bit. Oftentimes, yes, I'd say six months is probably a reasonable timeframe to see how that unfolds. Would see if you look at some of the disclosure around our operating companies, Some of them are starting to react to lower prices by reducing their capital budget somewhat, so there is already a little bit of impact. I would say the majority likely you'll see some news next quarter if prices continue to be lower.

Tanya Jakusconek, Analyst: Okay, thanks for that, Jason. Maybe I can come to Paul on my second question, just back on Cobre Panama and the arbitration. So I actually maybe just on the next steps. I where do we stand on the concentrate? I mean, we've been told that they fired up the the power plant or have they fired up the power plant?

I think they were given direction to fire up the power plant, and then there was a concentrate on-site that was supposed to be sold. So maybe just where what exactly is happening on-site, and have we a timeline on selling this concentrate?

Paul Brink, President and CEO, Franco Nevada: No timeline yet, Tanya. Really three moving pieces there that they one is the approval of the preservation and safe maintenance. The the other is shipping of the concentrate, and the third is restarting the power plant. The indications again from the government is that they're open to all those things going ahead, but they haven't actually gone ahead at this stage. So I'm I'm hopeful that that in the coming months that that we should see all those things go ahead.

Tanya Jakusconek, Analyst: Okay. So on the mind I guess on the property mine site, they're just keeping it on care and maintenance with the the normal care and maintenance procedures that are in place, and there's nothing else that is going on?

Paul Brink, President and CEO, Franco Nevada: Not that I'm aware of.

Tanya Jakusconek, Analyst: Okay. And then just in your comments, you said you'd be open to dropping the arbitration under certain conditions with your discussions, not into the details, but just from a bigger picture, what would lead you to drop the arbitration? Would it be that you're progressing ahead, the concentrate is sold, or are there anything that you can provide some color on what would help you with your decision on the arbitration?

Paul Brink, President and CEO, Franco Nevada: Yeah. So first, the it's suspending rather than dropping, so that just would be putting it on hold for a period to allow that there is a negotiation, but you know, with still with the rights that that could pursue. So I'd say you're putting it on hold is a good word. I don't want to get into the details of what those conditions would be, but the broad is, know, want to know that the table is set for negotiation and that both parties are ready to go.

Tanya Jakusconek, Analyst: Okay. Okay. Thank you for that. And maybe my last question, I just wanted to circle back on the transaction opportunities. I want to start by asking, last quarter when we talked about the transaction opportunities, we talked about a pipeline in the 100,000,000 to $500,000,000 range.

Some of your peers have mentioned that that range now has moved up in size. So I'm just wondering, are you seeing larger opportunities out there? And are those opportunities mainly in base metal producers that are trying to crystallize on this higher gold price? I'm just trying to understand whether that's something that has increased sort of transaction opportunities. And then I just wanted to ask about the royalties versus the stream.

How do those look in terms of opportunities? Are you seeing more royalties, more stream?

Ian Gray, Executive Team Member, Franco Nevada: Hi, Tania, it's Ian again. And I would say first off, we're seeing similar conditions to what we saw last year in terms of overall volume of deals and also on size. That's probably the best guidance I can give you in terms of deal volume and sizing. In terms of royalties versus streams, similar to last year it's a mix, and we're seeing good opportunities in both.

Tanya Jakusconek, Analyst: Okay, even just you know, you came back and talked a little bit about you know, you have some opportunities in the non precious metals. Would that be outside of energy?

Paul Brink, President and CEO, Franco Nevada: Hey, Tanya. It's Jason. You know, we're looking at opportunities both within energy and outside of energy. So it's a pretty broad universe of things that we're looking at. Overall, it's a little bit about the commodity, but a lot of it is just what assets are available and which are the best quality opportunities, and those are the ones that we'll focus our time.

Tanya Jakusconek, Analyst: Okay. And in the non gold opportunities, what size would those be at?

Paul Brink, President and CEO, Franco Nevada: You know, there's really a a wide range from very small to to larger transactions, so we're looking at full spectrum of sort of quantum.

Tanya Jakusconek, Analyst: Okay. When you say large, is that small from, like, 50 to 500, or is it up to a billion? I don't know what your large is.

Paul Brink, President and CEO, Franco Nevada: Know, large is a spectrum from, you know, zero to plus 500,000,000.

Tanya Jakusconek, Analyst: Okay. Alright. That's helpful. Thank you so much for taking my questions, and good luck, and that's a good quarter. Thank you.

Paul Brink, President and CEO, Franco Nevada: Thank you.

Jenny, Conference Call Operator: You. Your next question is from John from John Tumazos Independent Research. Your line is now open.

John, Analyst, John Tumazos Independent Research: Thank you. I noticed that Newmont sold 40,000,000 shares of Discovery Silver overnight. First question, would Franco want to buy the next block that Newmont wants to sell to have more, Or would Franco be a seller?

Paul Brink, President and CEO, Franco Nevada: John, we're a very happy supporter of the team at Discovery. We're delighted with the shares that we hold. The but our strategy, as you know, is principally around royalties and streams, where in getting deals done, that's helpful for us to do some equity, in particular, to be a lead order in an equity deal is something that we do. And one of the things we're trying to do is not put money in, but leverage the dollars that we're putting in. So if we can help the company raise more capital by providing that endorsement, that's a good part of the strategy.

But just buying block of shares is not really part of the strategy.

John, Analyst, John Tumazos Independent Research: Following up on the earlier question, as the gold price rises, it's easier for the exploration and development companies to raise money. Should we expect Franco to have a larger dividend payout in view of the booming gold price?

Sandy Branagh, Chief Financial Officer, Franco Nevada: Hi, John, it's Sandeep here. As you know, we have always highlighted our dividend strategy as being sustainable and progressive, where we always want to be in a position where we are raising the dividend, and we're proud of the fact that we've raised it eighteen years in a row. In terms of a higher dividend payouts, our priority is always adding assets, good long life assets, whether royalty or stream. And we see lots of opportunities right now. So I think you'd see our focus for capital deployment on adding those types of assets to the portfolio, but still raising the dividend.

But I wouldn't expect an unusually higher increase in the dividend than we normally have done.

John, Analyst, John Tumazos Independent Research: Happy hunting. Thank you.

Jenny, Conference Call Operator: Thank you. There are no further questions on the phone line. I will now turn the Q and A session over to Candida Hayden, who will take questions from the webcast.

Candida Hayden, Senior Analyst, Investor Relations, Franco Nevada: Thank you, Jenny. There are no further questions from the webcast. This concludes our first quarter twenty twenty five results conference call and webcast. We expect to release our second quarter twenty twenty five results after market close on August 9. Thank you for your interest in Franco Nevada.

Jenny, Conference Call Operator: Thank you. Ladies and gentlemen, that concludes our conference call for today. Thank you all for participating. You may now disconnect your lines.

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