Corporate Profile Focused on oil and gas royalties 2019E royalty production 10,000-10,500 boe/d Annual dividend (2) (0.0525 per month) 0.63/share 2019E revenue from oil & NGL 89% Current dividend yield (3) 7% Market…
Freehold Royalties Focus Areas B.C. Alberta Saskatchewan Manitoba +/- 700 Gross wells per year drilled on Freehold acreage in Canada Slave Point Montney Gas Clearwater Activity focused on lighter oil plays in eastern Alberta and…
North Dakota Mineral Title Acquisition Freehold announced its first U.S. royalty transaction subsequent to Q2-2019, acquiring 5,800 gross (450 net) mineral title acres along the border of McKenzie and Mountrail counties in North…
Investment Thesis Opportunistic acquiror Financial strength, low risk Completed 300 million in royalty 35/boe operating netback (1) transactions over the past three years 5.25/boe cash costs (2) (3) 30 million in deals YTD, funded via…
Near-Term Outlook Created 102 new leases on our royalty lands in 2018 50% increase in gross spending on our lands in 2018 over Increasing Activity on our 2017 Royalty Lands Remain flexible with royalty rates on our lands Most of the…
2018 Industry Drilling vs. Freehold Activity 719 (21.3 net) wells drilled on Freeholds lands in 2018 WELLS 2018 FRU Royalty Drilling Approximately 10% of all activity in 2018 Industry Drilling western Canada was drilled on…
Near-Term Free Cash Flow Allocation With an improving commodity price environment, Freehold has begun to generate free cash flow over and above our dividend. Our near-term focus is on allocating returns to our shareholders via: Dividend…
Oil Price Leverage 1.60 2019E Annual free cash flow per share 1.40 At current commodity price 1.20 levels, Freehold generates 1.00 significant funds from 0.80 operations 0.60 0.40 0.20 0.00 40/bbl 50/bbl 60/bbl…
Sustainable Dividend 120% 100% 80% Freehold continues to target Payout (%) a payout ratio of 60% 60% 80% 40% 20% 0% Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 2019E…
Strong Balance Sheet (at December 31, 2019) 5.0 (multiple) 4.5 Freehold maintains financial 4.0 flexibility with 2019E net 3.5 debt/funds from operations 3.0 of 0.8x 2.5 2.0 1.5 1.0 0.5 0.0 1998 1999 2000…
Low Risk Profile E&P Torque to Higher Oil Prices Benefit of: The royalty model provides Dividend Yield a number of advantages over typical E&P operators Capital Costs Abandonment No exposure to: Liabilities Operating &…
Strong Operating Margins 40 35 30 25 98% Operating per boe 20 15 Margin in Q2- 2019 (1) 10 5 0 Op costs (/boe) Operating Margin (/boe) 1. See Non-GAAP Financial Measures reflects period end June 30th,…
Increasing Royalty Focus 12,000 10,000 Production (boe/d) 8,000 Freehold has grown royalty production while reducing our 6,000 working interest volumes 4,000 2,000 0 Q2-2016 Q3-2016 Q4-2016 Q1-2017…
Industry Drilling vs. Freehold Despite a slowdown in 18000 25 activity in western 16000 Canada, Freehold has Gross wells western Canada 20 14000 achieved growth in net Freehold net wells 12000 drilling on its royalty…
Viking Oil-Strong Cash Flow Generator Acquired acreage as part of a 2015 royalty acquisition Change in operator has resulted in a ramp-up in activity. Drilling represented 60% of activity in H1-2019 Expect activity levels to…
Clearwater Oil-Near-term Growth Upside In Q3-2018 Freehold acquired an interest across 170 sections in the emerging Clearwater oil play Proceeds funded an initial drilling program Drilling results have met initial type curve…
New Lease Counts 2014- YTD 2019 120 of Leases Issued 100 100 102 80 60 40 42 30 20 20 0 2015 2016 2017 2018 YTD 2019 Lease Period YTD as of June 30, 2019 TSX : FRU Summer 2019 21
2019 Guidance 2019 Annual Average August 1, 2019 May 7, 2019 Royalty production boe/d 10,000-10,500 9,900-10,300 West Texas Intermediate (WTI) US/bbl 57.50 62.50 crude oil Edmonton Light Sweet crude oil Cdn/bbl 66.00 71.00…
Why Own Freehold Oil price leverage Change in WTI from 50 to 60/bbl increases our free cash flow (1) 25% Payout (1) target 60%-80% Top tier cash netbacks 35/boe in Q2-2019 Sustainable Cash costs 5.25/boe 7% dividend yield (2)…
Supplemental Information Quality Assets Sustainable Dividends freeholdroyalties.com
Corporate Sensitivities Estimated change in funds Variable Change (+/-) from operations (/share) West Texas Intermediate (WTI) US1.00/bbl 0.02 Canadian/U.S. dollar exchange rate US0.01 0.02 Canadian oil price differential to WTI…
Royalty Production History 12,000 Royalty Production (boe/d) 11,270 11,197 11,052 10,919 10,960 11,000 10,701 10,169 10,351 10,322 10,312 10,311 10,139 10,250 10,000 9,725 9,495 9,249 9,000 8,761 Freehold has increased 8,039…
Disciplined Acquirer Cost Initial Production Year Area ( millions) Acquired (boe/d) 2010 AB, SK and BC 38 400 2011 NW AB 7 100 2012 AB, SK and BC 60 600 2013 Numerous small acquisitions 10 30 2014 SK/MB/AB 248 1,500 2015 SK/AB/BC…
FRU Stock Price Tracks Oil Price 30.00 WTI in US FRU in C 55% 100.00 25.00 2019E royalty oil and 20.00 75.00 NGL production 15.00 50.00 100% 10.00 25.00 unhedged 5.00 0.00 - WTI Oil Price (US) FRU Share Price…
Owner of Legacy Lands Mineral titles held in perpetuity 8s and 26s Historic land grant to predecessor of Hudsons Bay Company in 1670 by the King of England HBC surrendered land to Canada in 1870 for cash and 1/20th of lands (Section…
Advisories Forward-Looking Information This presentation offers our assessment of Freeholds future plans and operations as at August 1, 2019 and contains forward-looking information including, 2019 expected average daily royalty and total…
Advisories cont. Non-GAAP Financial Measures Within this presentation, references are made to terms commonly used as key performance indicators in the oil and natural gas industry. We believe that operating income, operating margin, free…
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