• Total Revenue: $275.7 million for Q3 2024, compared to $309.5 million in the prior year.
• Adjusted EBITDA: $236.2 million for Q3 2024, down from $255.1 million in Q3 2023.
• Adjusted Net Income: $153.9 million for Q3 2024, compared to $175.1 million in Q3 2023.
• Adjusted Net Income Per Share: $0.80 for the quarter.
• Gold Equivalent Ounces (GEOs) Sold: 110,110 for Q3 2024, compared to 160,848 in the prior quarter.
• Cash Cost Per GEO: $290 per GEO for Q3 2024, compared to $304 per GEO in Q3 2023.
• Margin Per Ounce: Approximately $2,200 per ounce in Q3 2024.
• Effective Tax Rate: 21.6% for the quarter.
• Available Capital: $2.3 billion as of September 30, 2024.
• Debt Status: Company remains debt-free.
• Depletion: Decreased to $54.2 million from $68.1 million a year ago.
• Arbitration Costs for Cobre Panama: $1.9 million in Q3 2024, with $4.2 million incurred year-to-date.

• Warning! GuruFocus has detected 6 Warning Signs with HRNNF.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Franco-Nevada Corp (NYSE:FNV) reported increased contributions from newly commissioned mines in Brazil and new royalty acquisitions.
• The company expects full-year revenue to be higher than initially guided, with estimates between $1 billion and $1.1 billion.
• Franco-Nevada Corp (NYSE:FNV) maintains a strong deal pipeline and is confident in adding attractive precious metal assets to its portfolio.
• The company remains debt-free with available capital of $2.3 billion as of September 30, 2024.
• Franco-Nevada Corp (NYSE:FNV) has benefited from record gold prices, resulting in significant margins and increased revenue year-over-year when excluding certain assets.

Negative Points

• Total GEOs sold in the third quarter of 2024 were lower compared to the prior year, primarily due to lower deliveries from certain mines.
• The company revised its 2024 GEO guidance downward due to lower than expected gold deliveries and slower ramp-ups at newly contributing mines.
• Franco-Nevada Corp (NYSE:FNV) continues to face challenges with the Cobre Panama mine, which remains in preservation and safe management.
• The Hemlo NPI was weaker than expected, and the company has limited visibility on future contributions from this asset.
• The decrease in energy GEOs was attributed to lower production and revenue due to weaker natural gas prices.

Q & A Highlights

Q: You've revised guidance for the year. What could drive you to hit the higher or lower end of the range? A: Sandip Rana, CFO: The range is influenced by gold prices and timing of deliveries. For instance, Lundin had a strong Q3, but the timing of deliveries could affect whether production is realized in Q4 or carries into 2025.

Q: Despite changes in 2024 guidance, you've maintained your long-term guidance. Does this imply short-term issues won't impact the long-term profile? A: Sandip Rana, CFO: Yes, the portfolio is performing well overall. Candelaria had a slow start but improved in Q3. We have confidence in our portfolio and will update guidance in March 2029.

Q: Can you elaborate on your interest in potash and other commodities besides gold? A: Paul Brink, CEO: We are strategic about entering other commodities, especially during downturns. Potash interests us due to its long reserve life, complementing our gold portfolio. We have an option to acquire a royalty on a potash project.

Q: Are there any other potash deals in the pipeline? A: Paul Brink, CEO: Currently, this is the only immediate potash opportunity, but we remain open to other commodities like iron ore and copper due to their long-dated nature.

Q: Can you discuss the potential impact of the US election on your operations? A: Paul Brink, CEO: We anticipate positive impacts, particularly for our royalties on the Stip Night and Copper World mines, which are moving through permitting processes. Additionally, our oil and gas interests in the US could benefit from developments in LNG exports.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.