TSX: ALS
Coal to Renewable Power | Clean Steel | Potash | Copper | Lithium | Nickel | Cobalt
|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.
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ROYALTIES ONA SUSTAINABLE
NATURAL RESOURCEFUTURE
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.
|4TSX: ALS | OTCQX: ATUSFTSX: ALS | OTCQX: ATUSF
Issued Common Shares 41.5 million
Fairfax Preferred Securities 10.0 million ($100 million)
Basic Market Capitalization $451 million
Annual Dividend $0.20 per share
Outstanding Debt $141 million
Cash and Public Equity Holdings† $136 million
Available Under Credit Revolver† $39 million
TSX: ALS | OTCQX: ATUSF
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 FlowReturns of Capital
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
†Market cap as of Nov 10, 2020. Cash and public equity holdings includes $16 million cash + $74 million LIORC equity value + $46 million project generation equity values, as at Sep 30, 2020.
Capital Structure and Track Record
Altius Minerals Corporation
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Royalty Revenues
15 Producing & Diversified Royalties
Strong Track Record of Growth
Base
Metals
44%
Steel Making Coal 3%
Electricity Generation (Coal) 16%
Clean Iron One 8%
Potash
25%
Royalty Revenues
Q3 – 2020
$16.2 Million
YTD 2020
$45.5 Million
Nine Months
Ended Sept 2020
Royalty Revenues
Other 3%
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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.
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9
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
2
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 with 940MW of project royalties created thus far.
Genesee at reduced capacity after four years.
Iron
Base Metals
Potash
+
+
+
+
+
M&I: 928 Years
M&I: 57 Years
M&I: 928 Years | Inferred: 759 Years
M&I: 528 Years | Inferred: 873 Years
M&I: 194 Years | Inferred: 86 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
9
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PG BUSINESS GROWTHRoyalty Creation at Negative Cost
60 Projects
Converted to new
royalties and junior
equities since 2016
market bottom
Raised in 2020 by
Altius Portfolio
Companies
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 Q3 2020
$33M
-$3M
April 2017
-$6M
December 2018
$0.75M
$54M $54M
$17M
$11M
$22M $46M
Junior Equity Portfolio Growth
>$140M
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DRILLING EXPOSURE>$140mm in Capital Raised and 130,000m of Drilling in 2020
50,000m
18,000m15,000m
14,600m 13,000m
5,000m 4,000m 3,000m 3,000m 3,000m
$38 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
Altius anticipates approximately 130 kms of no-direct-cost drilling with results from much of this weighted
towards the fourth quarter owing to Covid-19. This estimate does not include significant brownfield drilling
programs that are ongoing or planned around producing assets that Altius holds royalties/streams over,
including most notably the major expansion focused drilling efforts underway at Chapada.
Top 10 Drill Programs by Meterage within Altius’ PG Portfolio
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Renewable Royalties
ALTIUS
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Transaction Overview
• Altius’ subsidiary, ARR, has entered into a strategic joint venture with certain funds (the “Apollo
Funds”) managed by affiliates of Apollo Global Management, Inc. (NYSE: APO) to accelerate the
growth of its renewable energy royalty business
• Altius has funded US$66 million to date; Apollo Funds has the right to acquire a 50% stake in Great
Bay Renewables Inc. (“Great Bay” or “GBR”), which is the US based operating subsidiary of ARR, by
committing to fund the next US$80 million
• Future funding, after Apollo Funds’ first US$80 million is deployed, will be shared on a 50/50 basis
• Apollo Funds has publicly stated that it expects to invest up to US$200 million in GBR
• “Sidecar” GBR investment opportunities will be contemplated for investments in non-royalty
components of project capital structures, providing each Altius and Apollo Funds the option to
participate and GBR will have the potential economic benefit of management fee like income
Transaction Rationale
• ARR and Apollo see significant market opportunity for GBR to provide renewable energy royalty
financing to help fund the development of wind, solar and energy storage projects to be built in the
U.S. and Canada over the next decade
STRATEGIC RELATIONSHIP WITH APOLLO GLOBAL ASSET MANAGEMENTTransaction Overview and Rationale
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Listen to Apollo Infrastructure’s co-head Geoff Strong talk renewables and goals for the asset manager’s infrastructure platform: tinyurl.com/apolloARR
Highly Experienced Strategic Partner
• Like-minded investor who sees the significant growth potential of the renewable energy sector as well
as the increasing need for project funding and more innovative capital solutions
• Sophisticated in structuring and capital formation for renewable energy projects
• Deep suite of industry relationships within the power and renewables sector to accelerate product
development
Strengthens Balance Sheet and Accelerates the Business
• Immediate source of committed capital to fund current and developing investment opportunities that
allows ARR to continue its momentum
• Enables more rapid scaling of the business; allows ARR to extend its lead as a first-mover, bringing an
innovative royalty investment model to the renewable energy sector
Accretive Transaction
• Accretive implied entry valuation to Altius’ cost basis
• Demonstrates enhanced financial strength and long-term commitment to potential new royalty
counterparties
STRATEGIC RELATIONSHIP WITH APOLLO GLOBAL ASSET MANAGEMENTWhy Apollo as Our Joint Venture Partner
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RENEWABLESTRANSITION
MOMENTUM
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),
$0
2010 2015 2020 2025 2030
1,400
1,200
1,000
800
600
400
200
Observed prices 18% learning rate
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 will cause demand for electricity to grow relative to other sources and storage additions allow renewables to gain further grid-based market share.
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
)
$350
$150
$100
$50
$200
$250
$300
Utility Scale SolarGas-Combine CycleNuclear
WindCoal
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ARR DEVELOPMENT PROGRESS
ACCELERATING
2017 2018 2019 2020
Renewable Royalty
First renewable royalty on small hydro/solar project in VT
CIP acquires Panther Grove wind project from TGE for 2nd embedded royalty – 12/2019
Renewable Royalty
GBR acquired by Altius Minerals (through Altius Renewable Royalties subsidiary) – 2/2019
Formation
GBR makes US$30MM royalty investment in Tri Global Energy (“TGE”) –2/2019
Royalty Investment
Silverpeak acquires Flatland Solar project from TGE for 3rd
embedded royalty –3/2020
Renewable Royalty
GBR makes US$35MM+ royalty investment in Apex Clean Energy –3/2020
Royalty Investment
Developed and refined renewable royalty structure and offering (legal, tax, etc.)
Formation
GBR formed andbegins working onbusiness concept withAltius – Q1 2017
Formation
Up to US$200MM strategic investment into GBR from Apollo Funds – 10/2020
Strategic Investment
Silverpeak acquires Canyon Wind (TX) from TGE for 1st embedded royalty on a TGE project –10/2019
Renewable Royalty
Altius and Apollo JV commits an additional US$25 MM Investment into TGE – 10/2020
Strategic Investment
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APEX’s DEVELOPMENT PORTFOLIO
21 GWDevelopment Portfolio
1.6 GWProject Transcated 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 in2009. Its current portfolio includes approximately 21 GW (12.5 GW wind, 8.5 GW solar) of development projects. Apex typically vends these projects toutilities, infrastructure funds and other institutional investors prior to construction.
Development
Note: Development locations are approximate.
Top 5 Developer in the USA in 2019 by Installed Capacity
Website Link
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TRI GLOBAL ENERGY DEVELOPMENT PORTFOLIO
Note: Development locations are approximate.
Also a Top 5 Developer in the USA in 2019 by Installed Capacity
3+ GWDevelopment Portfolio
940 MWProjects Sold with ARR Royalty
Wind and SolarAsset Diversification
Tri Global Energy is a leading renewable energy developer drawing on the natural, renewable resources of the wind and the sun to successfully address thegrowing demand for clean and sustainable energy. Tri Global Energy is the leading utility-scale developer responsible for nearly one quarter of all windenergy projects currently under construction in Texas, the nation’s leader in wind capacity.
Development
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0
100
200
300
400
Solar Wind Storage Gas Nuclear Coal Other
U.S. RENEWABLE DEVELOPMENT
MARKET OPPORTUNITY
Source: Berkeley Lab review of interconnection queues, Bloomberg NEF
US Interconnection Applications by Generation Type (Gigawatts)
20
14
20
15
20
16
20
17
20
18
20
19
Entered queues in an earlier year Entered queues in the year shown
20
14
20
15
20
16
20
17
20
18
20
19
20
14
20
15
20
16
20
17
20
18
20
19
20
14
20
15
20
16
20
17
20
18
20
19
20
14
20
15
20
16
20
17
20
18
20
19
20
14
20
15
20
16
20
17
20
18
20
19
20
14
20
15
20
16
20
17
20
18
20
19
Hatch portion indicates the amount paired with storage
5.6
>5.0 4.9
4.2 4.1 3.9 3.6
>3.0 2.8 2.8 2.8 2.6
2.2 2.1
14.9
Developer Installed Capacity (GW) 2010-2019
Top 15 renewable energy
developers in the US
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RENEWABLE ENERGY SECTOR
ARR Represents First Royalty Level Business Model Within Utility Scale
Renewable Energy Sector
Increasing Investor Interest
EV/EBITDA Multiples for Operators Versus Royalty Co’s
6.2x 5.0x
6.6x
13.5x
9.3x 9.7x
19.0x
-
5x
10x
15x
20x
25x
Oil & Gas Diversified Precious Metals Renewables
Operator Royalty
?
EV / 2021E EBITDA Multiples for Operators Versus Royalty Co’s(1)
Source: Factset. Market data as of November 10, 2020; (1) Consensus Estimates
TSX Renewable Energy and Clean
Technology Index since Covid bottom
Renewables sector emerging as a leader in pandemic recovery.
100
120
140
160
180
200
220
Mar2020
Apr May Jun Jul Aug Sep Oct Nov2020
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THANKYOU
Flora WoodDirector, Investor RelationsPhone: (416) 346-9020Email: [email protected]
Producing Royalties
Development Royalties
Project Generation
Renewable Energy Portfolio