Corporate Presentation March 2020 TSX:ALS | OTCQX:ATUSF
Forward Looking Statements 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. TSX:ALS | OTCQX:ATUSF
Long-Term, Counter-Cyclical Discipline Royalty Acquisition Cash Build Acquisitions Organic Growth Altius Interpretation of Mining Cycle $78M Position $67M Royalty Revenue $47M $28M $33M $6M 1997 – 2001 2002 – 2011 2012 – 2015 2016 – Present IPO & INITIAL YEARS C OMMODITIES SUPERCYCLE C OMMODITIES SUPERCYCLE R OYALTY REVENUE GROWING FAST ON VOLUME ENDS GROWTH AND IMPROVED PRICES • • Less than $1MM market cap upon IPO in 1997 Multiple royalty acquisitions made as balance sheet crisis hit the mining sector and motivated asset sales • Innovator of Project Generator Model for mineral exploration that trades projects for royalties and partner equity – protecting Altius • Royalty revenue from long life assets grown to $78M - with very high capital structure accompanying EBITDA and Cash Flow margins • • Equity gains of more than $200MM and many early stage royalties Embedded organic (free) growth coming from mine expansions and created from PG business during super-cycle extensions while also innovating new renewable royalty business • • Decision to use profits to expand royalty portfolio with focus on non- 42 million common shares outstanding - no roll backs precious metal commodities • Developed a royalty wish list but forced to sit on cash for several years until commodity prices and sentiment declined 3 TSX:ALS | OTCQX:ATUSF
Growth Track Record Royalty Revenue Per Share Royalty Revenue $1.79- $1.91 $1.86 $1.56 $75M $1.08 - $78M $0.88 $0.83 $80M $0.22 $67M $47M $33M $28M FY 2014 FY 2015 FY 2016 FY 2017 2018 2019 2020 $6M Guidance FY 2014 FY 2015 FY 2016 FY 2017 2018 2019 2020 Per share growth focus Guidance EBITDA Per Share 80% EBITDA Margin $1.43- $1.49 $1.53 $1.24 $0.80 $0.71 $0.64 56% OCF Margin FY 2015 FY 2016 FY 2017 2018 2019 2020 Guidance 4 TSX:ALS | OTCQX:ATUSF
Royalty Growth Pipeline Organic (Free) Mine Strong operating margins and long resource lives (85 years revenue weighted average) Royalty Growth motivating multiple new build and expansion investments by operators = free royalty growth Renewable Royalty New renewable energy royalty business growing fast as electricity generation transition Business Gaining accelerates and sector begins to recognize benefits of royalty finance offering Momentum Financing Discovery Ramping Up Building Resource Stage Expansion Study and Development Completed Potash New Mines in Renewable Development Expansion of Existing 168,000 metres of New Build Studies Expansions Construction Portfolio Assets drilling in 2020 60+ Exploration Rocanville Stage Royalties Chapada Voisey’s Underground Cory Expansion (Cu) (Ni-Co-Cu) Allan Vanscoy 2.5 GW Portfolio Gunnison (Copper) Esterhazy 21 GW Development Portfolio 5 TSX:ALS | OTCQX:ATUSF 5
PG Business Growth - Royalty Creation At Negative Cost 57 Converted to new royalties and junior equities since 2016 market Junior Equity Portfolio Growth bottom Projects PG Net $17M Monetizations $17M Positive cash generation in 2019 $11M $54M $54M $33M $22M -$3M -$6M 1 st Gunnison starting up to mark first April 2016 April 2017 December December PG created royalty to reach 2018 2019 production stage Proven Equity/Royalty Investment Strategy Allows Creation of New Pipeline Royalties at Negative Cost and Provides Cash for 3 rd Party Royalty Acquisitions 6 TSX:ALS | OTCQX:ATUSF
Renewables Transition Momentum Growth Megatrends driving increased electricity demand: Electrification trends (e.g. transportation about to shift to EV) will EV Battery $ Cost / kWh cause demand for electricity to grow and gain market share relative to other sources of consumer energy such as fossil fuels $ Cost Parity with Internal Combustion Engine Levelized Cost of Energy Comparison Past the tipping point: Within the electricity sector, renewable energy has become the cheapest form of new generation ESG Going Mainstream: Lower costs, higher efficiencies and underlying demand growth coupled with a surge in ESG investment mandates creating a massive tailwind for renewable energy investments Source: “Electrifying Insights: How Automakers can Drive Electrified Vehicle Sales 7 TSX:ALS | OTCQX:ATUSF and Profitability,” McKinsey – January 2017 , Lazard’s Levelized Cost of 7 Energy Analysis – Version 13.0 (November 2019), US SIF Foundation
Tri Global Energy Investment – First Year Progress • 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) Source Company Reports 8 TSX:ALS | OTCQX:ATUSF
ARR’s Royalty Finance Model Attracts Second Major Developer US$35MM+ Investment in Apex Clean Energy Overview • On March 10, 2020, Altius announced that ARR has closed a US$35+ million royalty investment transaction with Apex Clean Energy (“Apex”) • ARR’s investment is funding Apex’s development efforts for its current portfolio of projects and also facilitating its expansion - allowing Apex to ultimately bring more projects to market • As Apex sells its development projects to final project sponsors ARR receives new royalties until a minimum royalty vesting threshold is met. • Once vested by ARR, royalties are “perpetual” and uncapped Royalty Contract Details • Option mechanism allows for future US$10 million tranches based upon achieved milestones • Royalty payment is pre-set as a percentage of gross revenues • Using current assumptions portfolio is estimated to generate US$3-4 million in new annual royalty revenues 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. 9 TSX:ALS | OTCQX:ATUSF 9
Apex Is One of the Largest Renewable Energy Developers in US 1.6 GW 21 GW +2.0 GW Projects Transacted Development Portfolio Under Construction in 2019 Source Company Reports 10 TSX:ALS | OTCQX:ATUSF 10
Diversified, High Quality Assets 15 Producing Royalties Low Jurisdictional Risk Canada, USA and Brazil Investment Grade Operators Royalty vs. Stream Dominated Zinc 3% Steel Making Coal 4% Copper 37% Premium Iron Ore 20% 2019 Commodity Revenue Electricity Generation (Coal) 14% Battery Metals (Ni-Li-Co) 2% Potash 19% 11 TSX:ALS | OTCQX:ATUSF
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