2021 Q3 Report

2021

Third Quarter Report

For the three and nine months ended September 30, 2021

Investment that WORKS

Press Release

NEWS RELEASE

Toronto, November 3, 2021

(in U.S. dollars unless otherwise noted)

Franco-Nevada Reports Strong Q3 Results

2021 Energy Guidance Increased

"Franco-Nevada delivered a strong third quarter, setting the stage for a record year in 2021. Our diversified portfolio continues to serve us well with strong contributions during the quarter from precious metals, energy and iron ore," stated Paul Brink, President

• CEO. "Higher energy prices have led us to increase our 2021 Energy guidance for the second time this year. Margins have moved higher this year due to the inflation-protected nature of our business model. Franco-Nevada is debt-free and is growing its cash balances."

	Record YTD results	YTD/2021	Strong Q3 results	Q3/2021
	vs	vs
		YTD/2020		Q3/2020
GEOs(1) sold	462,926	+24%	146,495	+9%
Revenue	$972.3 million	+36%	$316.3 million	+13%
Net income	$512.8 million ($2.68/share)	+243%	$166 million ($0.87/share)	+8%
Adjusted Net Income(2)	$509.1 million ($2.67/share)	+44%	$165.6 million ($0.87/share)	+9%
Adjusted EBITDA(3)	$822.5 million	+40%	$269.8 million	+15%
Margin(4)	84.6%	+3%	85.3%	+2%

Strong Financial Position

• No debt and $1.6 billion in available capital as at September 30,
  2021
• Generated $206.9 million in operating cash flow for the quarter
• Quarterly dividend of $0.30/share

Sector-Leading ESG

• Ranked #1 gold company by Sustainalytics, AA by MSCI and
  Prime by ISS ESG
• Committed to the World Gold Council's "Responsible Gold Mining
  Principles"
• Partnering with our operators on community and ESG initiatives
• Goal of 40% diverse representation at the Board and top leadership levels

Diverse, Long-Life Portfolio

• Most diverse royalty and streaming portfolio by asset, operator and country
• Core assets outperforming since time of acquisition
• Growth in long-life reserves

Growth and Optionality

• Acquisitions, mine expansions and new mines driving growth
• 10.1 million ounce increase in Measured and Indicated
  Resources at Detour Lake
• Long-termoptions in gold, copper and nickel
• Noront consolidation likely to accelerate development of
  Ring of Fire properties

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Quarterly revenue and GEOs sold by commodity

		Q3/2021			Q3/2020
	GEOs Sold		Revenue	GEOs Sold		Revenue
	#	(in millions)	#	(in millions)
Gold	94,829	$	169.2	108,709	$	206.1
Silver	23,405		41.4	13,691		26.1
PGMs	9,458		16.9	10,630		21.3
Other Mining Assets	18,803		33.7	1,787		3.5
Mining	146,495	$	261.2	134,817	$	257.0
Oil	-		27.9	-		16.1
Gas	-		21.3	-		3.9
NGL	-		5.9	-		2.8
	146,495	$	316.3	134,817	$	279.8

Year-to-date revenue and GEOs sold by commodity

		YTD/2021			YTD/2020
	GEOs Sold		Revenue	GEOs Sold		Revenue
	#	(in millions)	#	(in millions)
Gold	310,898	$	554.1	294,218	$	509.7
Silver	75,755		134.1	39,203		68.4
PGMs	32,945		58.4	35,876		65.3
Other Mining Assets	43,328		78.2	4,791		8.4
Mining	462,926	$	824.8	374,088	$	651.8
Oil	-		78.9	-		40.0
Gas	-		53.8	-		15.1
NGL	-		14.8	-		8.8
	462,926	$	972.3	374,088	$	715.7

For Q3/2021, revenue was sourced 82.6% from Mining assets (53.5% gold, 13.1% silver, 5.3% PGM and 10.7% other Mining assets). Energy assets contributed 17.4% (8.8% oil, 6.7% gas and 1.9% NGL). Our current acquisition focus is to grow the precious metal side of our business, but we will also add opportunistically in other mining commodities if good assets are available. A strength of our diversified portfolio is that we benefit from the relative outperformance of different commodities over time. Geographically, revenue was sourced 91.2% from the Americas (33.1% South America, 23.6% Central America & Mexico, 19.8% U.S. and 14.7% Canada).

Increased 2021 Energy Guidance

Based on the increase in oil and gas prices and the performance of its Energy portfolio, Franco-Nevada is pleased to raise its Energy revenue guidance. Energy revenue is now expected to range from $195 to $205 million, an increase from the prior range of $155 to $170 million. Franco-Nevada is on track to meet the previously announced GEO guidance of 590,000 to 615,000 GEOs for 2021. Commodity prices used for the remainder of 2021 in our revised guidance are the following: $1,750/oz Au, $22.00/oz Ag, $950/oz Pt, $2,000/oz Pd, $110/t Fe 65% CFR China, $70/bbl WTI and $4.00/mcf Henry Hub.

Please see our annual MD&A and Q3/2021 MD&A for more details on our guidance and see "Forward-Looking Statements" below.

Environmental, Social and Governance (ESG) Updates

Franco-Nevada continues to receive top rankings from ESG agencies and during the quarter had its Prime rating reaffirmed by ISS ESG.

The Company recently added to its community programs, committing to fund water supply infrastructure to communities around Antapaccay. The Company is also partnering with Continental Resources to fund a pilot project for solar-powered water recycling. An added diversity initiative was the award of the first Franco-Nevada diversity scholarship to a student entering mining engineering at the University of Toronto.

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F N V T S X N Y S E

F r a n c o - N e v a d a C o r p o r a t i o n

Q3/2021 Portfolio Updates

Gold Equivalent Ounces Sold: GEOs sold for the quarter were 146,495, an increase of 8.7% from the 134,817 sold in Q3/2020. Higher contributions from Cobre Panama and Antamina, as well as the additions of the Vale Royalty Debentures and Condestable stream, were partly offset by lower deliveries from Hemlo. There was limited impact from COVID-19 on our assets this quarter, in comparison to Q3/2020, where a number of our assets were impacted by suspensions of production.

South America:

• Antamina (22.5% silver stream) - GEOs delivered and sold were significantly higher in Q3/2021 than in Q3/2020, which was impacted by a temporary suspension of production. In addition, changes in gold and silver prices in the current period have resulted in a more favourable GEO conversion ratio than in the prior period.
• Antapaccay (gold and silver stream) - GEOs delivered and sold were lower in Q3/2021 than in Q3/2020 due to lower grades as anticipated in the life of mine plan.
• Candelaria (gold and silver stream) - GEOs delivered and sold decreased in Q3/2021 relative to Q3/2020. Production at Candeleria was lower this quarter than in the prior year quarter due to changes in mine sequencing which have reduced 2021 copper and gold production guidance and are also expected to impact the operation's life of mine plan. Lundin is also aiming to improve mill throughput and address grade reconciliation.
• Condestable (gold and silver stream) - Franco-Nevada received its second quarter of deliveries from the recently acquired stream, with the asset contributing 3,127 GEOs in Q3/2021. Deliveries from Condestable are a fixed amount of ounces through the end of 2025.
• Vale Royalty Debentures (iron ore royalty) - Franco-Nevada accrued an estimated $21.7 million, or 12,101 GEOs, in Q3/2021, of which $5.6 million, or 3,109, GEOs, relates to H1/2021. The royalty payment received for H1/2021 exceeded our accrual due to higher average realized iron ore prices. In Q3/2021, iron ore prices decreased after achieving record highs in mid-2021 while deductible transportation costs increased. Year-to-date, we have recorded 27,594 GEOs.

Central America & Mexico:

• Cobre Panama (gold and silver stream) - GEOs increased in Q3/2021 relative to one year earlier, which was impacted by a suspension of operations due to COVID-19. Cobre Panama's production in Q3/2021 was a record of 87.2 kt of copper, and achieved further quarterly milestones, including records in tonnes milled. Along with its Q3/2021 results, First Quantum provided additional details on its construction and commissioning plans to expand Cobre Panama to achieve a throughput rate of 100 million tonnes per annum by the end of 2023. First Quantum reported that Law 9 discussions with the Government of Panama continue to be transparent and constructive towards a mutually beneficial agreement and that the environmental and labour aspects of the discussions have been concluded.
• Guadalupe-Palmarejo (50% gold stream) - GEOs sold from Guadalupe-Palmarejo were higher than in the same quarter in 2020 due to higher mill throughput and recoveries, reflecting ongoing blending optimization and business improvement initiatives. In September
  2021, Coeur reported positive results from its infill and expansion drilling campaign at the Independencia and Guadalupe deposits that demonstrated near-mine growth potential.
• Cascabel (1% royalty) - SolGold announced a maiden mineral resource at its Tandayama-America deposit, part of the Cascabel project, approximately 3 km north of the Alpala deposit, and covered by the Franco-Nevada royalty. The maiden resource comprises 233.0 million tonnes at 0.33% copper equivalent containing 0.53 million tonnes of copper and 1.20 million ounces of gold in the Indicated category, plus 197.0 million tonnes at 0.39% copper equivalent containing 0.52 million tonnes of copper and 1.24 million ounces of gold in the Inferred category.

U.S.:

• Stillwater (5% royalty) - GEOs from Stillwater increased from prior year, reflecting higher platinum and palladium prices.
• Goldstrike (2-6%royalties) - Production was impacted by planned maintenance shutdowns as well as a mechanical failure at the Goldstrike roaster. Repairs have been completed in Q3/2021 and production is anticipated to normalize in Q4/2021.
• South Arturo (4-9%royalty) - In October 2021, Nevada Gold Mines acquired from i-80 Gold the 40% interest in the South Arturo JV that it did not already own. The transaction provides Nevada Gold Mines 100% of the longer term upside at the South Arturo pit and the
  El Nino underground, as well as flexibility to pursue other potential operational synergies at Goldstrike.
• Mesquite (0.5-2%royalty) - In September 2021, Equinox Gold announced an updated mineral reserve and resource estimate for Mesquite. Measured and Indicated Mineral Resources, exclusive of Mineral Reserves, increased by 65% to 1,384,000 ounces of contained gold.
• Rosemont (1.5% royalty) - Hudbay Minerals has had continued success at its Copper World Project, expects an initial resource estimate before the end of the year, and is planning a preliminary economic assessment in the first half of 2022.

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