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JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd.

Freehold Royalties Ltd. · Jul 27, 2015 · 25 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 1
    Investor Presentation July 2015
  2. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 2
    Corporate Profile TSX : FRU focused on oil and gas royalties 2015e production (73% royalty production) boe per day 10,800 2015e Annual dividend (0.09 per month) per share 1.08 Current dividend yield(1) percent 6.7 Market…
  3. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 3
    Corporate Overview TSX : FRU Long history of generating attractive returns Annual average return of 17% Delivered greater than 29/share in dividends from an IPO of 10/share in 1996 Executed a consistent low risk strategy over our…
  4. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 4
    Investment Performance* TSX : FRU Cumulative dividends declared 29.47 per share (1.4 billion in dividends) 137 37 30 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 Freehold Royalties Ltd. S&P/TSX Oil and Gas…
  5. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 5
    Whats New TSX : FRU Freehold entered into definitive agreements to acquire two royalty packages totaling 318 million from Penn West Dodsland-Viking GORR: 8.5% GORR on Penn Wests core Viking property Existing royalties and mineral…
  6. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 6
    Acquisition Highlights TSX : FRU Accretive acquisition with attractive acquisition multiples in current price environment Expected cash flow accretion of 6% annualized in 2015 and expected to strengthen in future years (before…
  7. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 7
    Acquired Assets TSX : FRU Viking 3.5 million gross acres Heavy Oil 90% royalty Cardium Bakken, Mississippian 9
  8. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 8
    2015 Q1 Royalty Drilling Activity TSX : FRU Q1 2015 Royalty Well Count Total Gross wells = 28 Total Net wells = 1.4 Peyto Wilrich Hz IP30 3.2 MMcf/d Perpetual Wilrich Edson JV 4 Hzs Cardium Hzs CNRL Mannville Heavy Oil Vt…
  9. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 9
    Annual Royalty Drilling Trends* TSX : FRU * Equivalent net wells drilled on Freeholds royalty land. 11
  10. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 10
    Flexibility through Acquisitions TSX : FRU Freehold announced 400 million in transactions YTD 2015. Anderson corporate acquisition Freehold acquired Anderson Energy for 35 million. Transaction adds approximately 350 boe/d of low…
  11. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 11
    Accretive Acquisitions/Joint Ventures TSX : FRU Initial Production Cost Acquired Year Area ( millions) (boe/d) 2001 Southeast Saskatchewan 25 800 2005 Petrovera (CNRL) 352 3,800 2007 Alberta/Saskatchewan 90 700 2010 Alberta,…
  12. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 12
    Royalty-Focused Production TSX : FRU boe/d 73% 10,800 9,180 10,000 royalties 8,000 6,000 4,000 2,000 0 Royalty Interest Production Working Interest Production Based on 2015E production. 16
  13. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 13
    Top Royalty Payors/Operators* TSX : FRU * Top 30 payors account for over 80% of royalty revenue on a trailing 12 month basis. 17
  14. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 14
    The Royalty Advantage: Netbacks TSX : FRU A Working Interest Barrel A Royalty Interest Barrel Operating netback* Operating netback* 60% of gross revenue 100%** of gross revenue Royalties Paid Operating (15%) Netback…
  15. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 15
    The Royalty Advantage: Peers TSX : FRU FRUs liquids weighting and low cost model drive top decile economics (Q1-2015). CPG ZAR TBE PWT WCP TBE NBZ NBZ PSK SGY VET PGF ZAR LRE PGF BNE FRU CPG BNE WCP PEY VET PWT ERF ARX TET ERF ARX…
  16. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 16
    2015 Small Capital Program* TSX : FRU Capital Allocation 25 million Southeast Sask. Light Oil 65% Cardium Light Oil 29% Heavy Oil 6% * Per guidance dated March 5, 2015. 21
  17. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 17
    Dividend History TSX : FRU Dividend Selling Price (/share) (/boe) 3.00 2.91 120 2.50 100 2.10 2.00 1.92 1.92 80 1.70 1.73 1.68 1.681.68 1.68 1.68 1.56 1.50 1.40 60 1.32 1.31 1.10 1.08 1.00 40 0.78 0.65 0.50 20 0.13…
  18. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 18
    CFPS vs. Dividend TSX : FRU Dividend (/share) 3.50 We remain focused on preserving the long-term sustainability of our 3.00 Dividend 2.50 1.95 2.00 1.68 1.50 1.00 0.50 0.00 1996 1997 1998 1999 2000 2001 2002 2003…
  19. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 19
    Strong Financial Position TSX : FRU Debt to Funds from Operations* (multiple) 120 million credit capacity 4.5 currently available 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 1997 1998 1999 2000 2001 2002 2003 2004 2005…
  20. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 20
    2015 Sensitivities TSX : FRU Estimated Change in Funds From Change Operations Variable (+/-) ( per share) WTI oil price US1.00/bbl 0.04 Canadian/U.S. dollar exchange rate US0.01 0.02 Edmonton Par/WCS differential Cdn1.00/bbl…
  21. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 21
    The Manager TSX : FRU CN P ENSION T RUST F UNDS Pension fund for employees of Canadian National Railway 100% ownership 100% ownership Manager of the assets 22%* ownership (1) Based on 98 million shares outstanding…
  22. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 22
    2015 Outlook* TSX : FRU Guidance Updated Annual Average May. 14, Apr. 14, Mar. 5, 2015 2015 2015 Daily production boe/d 10,800 10,800 9,800 WTI oil price US/bbl 60.00 60.00 60.00 Western Canada Select Cdn/bbl 56.00 56.00 56.00…
  23. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 23
    FRU Stock Price Tracks Oil Price TSX : FRU WTI in US 150.00 63% FRU in C 30.00 oil and NGL 125.00 production 25.00 100.00 20.00 75.00 15.00 50.00 100% 10.00 25.00 unhedged 5.00 - - WTI Oil Price (US) FRU…
  24. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 24
    What is a Royalty TSX : FRU A payment based on a percentage of gross production Crown Royalty Mineral rights owned by the government (Crown) Leases auctioned at Crown land sales Royalty rates set by the Crown Held by the Crown in…
  25. JULY 2015 INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 25
    Proud Owner of Legacy Lands TSX : FRU Mineral titles are held in The 8s and 26s perpetuity Historic land grant to the Hudsons Bay Company (HBC) in 1670 by the King of England HBC surrendered land to Canada in 1870 in exchange…

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