Franco-Nevada(US:FNV)2025-11-04 17:02Financial Data and Key Metrics Changes - Franco-Nevada reported record financial results for Q3 2025, with total revenue increasing by 77% to $487.7 million compared to Q3 2024 [12][16] - Adjusted EBITDA also reached a record, up 81% to $427.3 million from $236.2 million in the prior year [12][16] - Adjusted net income was $275 million, or $1.43 per share, reflecting a 79% increase year-over-year [13][16] - The average gold price increased by 40% year-over-year, while the average silver price rose by 34% [9][10] Business Line Data and Key Metrics Changes - Total GEOs sold increased by 26% to 138,772 in Q3 2025, compared to 110,110 in Q3 2024 [10][12] - Precious metal GEOs sold were 119,109, up 41% from the previous year [10][12] - Approximately 11,000 GEOs were delivered and sold from Cobre Panama, contributing to the strong performance [11] Market Data and Key Metrics Changes - 85% of revenue in Q3 2025 was derived from precious metals, with 88% of revenue sourced from the Americas [14][16] - The company experienced a significant increase in natural gas prices year-over-year, while iron ore prices remained flat [9][10] Company Strategy and Development Direction - The company aims for approximately 50% growth in GEOs over five years compared to last year, supported by recent acquisitions and the potential restart of Cobre Panama [5][6] - Franco-Nevada is focused on maintaining a disciplined approach to acquisitions, emphasizing organic growth alongside new deals [21][27] - The company is exploring opportunities in Australia and remains open to diversifying into other commodities like natural gas and lithium if good value is found [22][24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the resolution of the Cobre Panama mine closure and the potential for a positive shift in public sentiment towards mining in Panama [5][81] - The company is encouraged by the recent performance of its key assets and the overall strong cash flow generation [4][9] - Management highlighted the importance of critical minerals and the positive developments in permitting processes for various projects [7][8] Other Important Information - The company reached a settlement with the Canada Revenue Agency regarding tax disputes for its Mexican and Barbadian subsidiaries, resulting in no tax payment required for foreign earnings during the specified period [16][17] - Franco-Nevada remains debt-free, with total available capital exceeding $1.8 billion as of September 30, 2025 [16] Q&A Session Summary Question: Can you talk about the commodity focus in the deal pipeline? - Management indicated that the primary focus remains on precious metals, with good prospects for adding more gold deals, while also being open to diversified opportunities if they present good value [21][24] Question: Will the focus shift more towards organic growth rather than new deals? - Management clarified that while there is strong organic growth potential, the focus will still be on acquiring new deals, maintaining discipline in the current market environment [27] Question: How does the recent gold price environment affect shareholder returns? - Management stated that the priority remains on adding quality assets, with plans to increase dividends sustainably, but share buybacks are not currently being considered [35][36] Question: What is the visibility on mining from different areas into Q4? - Management acknowledged limited visibility but expressed optimism about the performance of Musselwhite and Hemlo under new ownership [40][44] Question: What are the expectations for the restart of Cobre Panama? - Management is optimistic about the timeline for the restart, citing positive government comments and ongoing preparations [80][81] Question: How does the company view Argentina as a mining jurisdiction? - Management expressed a positive outlook on Argentina, highlighting recent regulatory changes that could attract investment [92][93]