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INVESTOR PRESENTATION – Freehold Royalties Ltd.

Freehold Royalties Ltd. · Apr 2, 2015 · 42 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. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 1
    Investor Presentation April 2015
  2. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 2
    Corporate Profile TSX : FRU focused on oil and gas royalties 2015e production(1) (68% royalty production) boe per day 9,800 2015e Annual dividend (0.09 per month) per share 1.13 Current dividend yield(2) percent 6.2 Market…
  3. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 3
    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 26% ownership 4
  4. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 4
    Investment Performance* TSX : FRU Cumulative dividends declared 29.25 per share 152 (1.3 billion in dividends) 38 32 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. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 5
    2014 Scorecard TSX : FRU Freehold Royalties Twelve Months Ended December 31 2014 2013 % change Daily production (boe/d) 9,180 8,913 3% Average price realization (/boe) 58.91 55.06 7% Operating netback (/boe) 52.30 47.91 9% Funds…
  6. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 6
    2014 Highlights TSX : FRU 2014 marked a strong period of activity for Freehold. Grew funds from operations to 138.5 million (1.95 per share), a 9% increase y/y on a per share measure. Production for 2014 averaged 9,180 boe/d, a 3%…
  7. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 7
    2015 Outlook* TSX : FRU Guidance Updated Annual Average Mar. 5, Jan. 14, Nov. 13, 2015 2015 2014 Daily production boe/d 9,800 9,800 9,700 WTI oil price US/bbl 60.00 60.00 85.00 Western Canada Select Cdn/bbl 56.00 54.00 77.00…
  8. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 8
    Why Own Freehold TSX : FRU Royalty Accretive Acquisitions Focus 9
  9. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 9
    Flexibility through Acquisitions TSX : FRU Freehold completed greater than 250 million in transactions in 2014, showcasing our flexibility. Mineral title transaction Freehold acquired royalty interests in certain producing and…
  10. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 10
    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,…
  11. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 11
    Why Own Freehold TSX : FRU Royalty Consistent focused strategy Focus 12
  12. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 12
    Royalty-Focused Production TSX : FRU boe/d 68% 9,800 10,000 9,180 royalties 8,000 6,000 4,000 2,000 0 Royalty Interest Production Working Interest Production Based on 2015E production. 13
  13. 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. 14
  14. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 14
    Board of Directors TSX : FRU Nolan Blades Harry Campbell Peter Harrison Art Korpach Sue Mackenzie Tom Mullane David Sandmeyer Rodger Tourigny Aidan Walsh 15
  15. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 15
    Why Own Freehold TSX : FRU Royalty large royalty portfolio Focus 16
  16. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 16
    Development Opportunities TSX : FRU 3.2 million gross acres Heavy North Saskatchewan River Cardium Oil Viking Royalty interests 93% Working interests 7% Oil resource plays Bakken, Mississippian 17
  17. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 17
    5 Year Royalty Drilling Trends TSX : FRU Our diversified portfolio enables exposure to a number of development plays within Western Canada 18
  18. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 18
    2014 Royalty Drilling Highlights TSX : FRU Edson JV. Mannville Heavy Oil 13 Gross Wilrich drilling is up 37% over wells . 2013. Lloydminster 152 Gross Wells Alberta West 154 Gross Wells Viking HZ drilling by private…
  19. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 19
    Royalty Drilling Trends* TSX : FRU Freehold Royalty Net Drilling 20 53% Oil 57% Oil 44% Oil 58% Oil 85% Oil 92% Oil 83% Oil 90% Oil 35% Hz 32% Hz 30% Hz 37% Hz 57% Hz 66% Hz 70% Hz 70% Hz 18 16 14 12 Oil Hz Net…
  20. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 20
    Why Own Freehold TSX : FRU Royalty low costs Focus 21
  21. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 21
    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…
  22. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 22
    The Royalty Advantage: Peers TSX : FRU FRUs liquids weighting and low cost model drive top decile economics (Q4-2014). VET TBE WCP PWT PSK NBZ CPG LTS TOG ZAR FRU SGY ZAR BNE BNE PGF NBZ TOG LTS LRE SGY CPG TBE VET TET WCP ARX ERF…
  23. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 23
    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. 24
  24. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 24
    Why Own Freehold TSX : FRU Royalty Attractive payout Focus 25
  25. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 25
    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 1.13 1.00 40 0.78 0.65 0.50 20 0.13…
  26. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 26
    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 2.00 1.50 1.00 0.50 0.00 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005…
  27. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 27
    Strong Financial Position TSX : FRU Debt to Funds from Operations* (multiple) 75 million credit 4.0 capacity (as of year-end) 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 2006 2007…
  28. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 28
    FRU Stock Price Tracks Oil Price TSX : FRU WTI in US 150.00 60% 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…
  29. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 29
    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…
  30. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 30
    Why Own Freehold TSX : FRU Royalty Performance Focus 31
  31. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 31
    Total Return Since December 31, 2010 TSX : FRU 175 150 + 25.4% 125 +22.9% 100 75 -35.0% 50 Dec 2010 Dec 2011 Dec 2012 Dec 2013 Dec 2014 FRU S&P/TSX Composite S&P/TSX Oil & Gas E&P Year to date to March 30, 2015. 32
  32. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 32
    2015 Relative Performance (div. adj.) TSX : FRU Whitecap 25% Enerplus 14% Crescent Point 8% Baytex 3% Pengrowth 2% S&P/TSX Composite 1% Perpetual 0% PrairieSky -2% Peyto -2% Freehold: Freehold -2% -2% Vermilion -7% Twin…
  33. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 33
    3-Year Relative Performance(div adj) TSX : FRU Peyto 128% Whitecap 85% Perpetual 45% Vermilion 30% TSX Composite 20% Freehold: Freehold 16% 16% ARC 10% Crescent Point -17% Enerplus -28% Pengrowth -48% Baytex…
  34. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 34
    5-Year Relative Performance(div adj) TSX : FRU Peyto 206% Vermilion 90% Freehold: 60% Freehold 60% ARC 36% S&P/TSX Composite 24% Crescent Point 4% Trilogy -4% Enerplus -21% Twin Butte -22% Baytex -22% Pengrowth…
  35. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 35
    Supplemental Information
  36. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 36
    Land Holdings* TSX : FRU 3.2 million gross acres Land Profile 22% held in perpetuity (693,000 gross acres of mineral title and royalty assumption lands; 76% leased) 872,000 gross acres undeveloped Undeveloped land…
  37. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 37
    Reserves Profile* TSX : FRU Net Proved Plus Probable Net Reserves Reserves 19.6 MMboe proved 49% oil and NGL 6.6 year RLI 29.7 MMboe P+P 54% oil and NGL 9.0 year RLI 30% increase in year-over- Light and medium crude oil -…
  38. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 38
    Production Profile TSX : FRU 2014 average 2014 Production Profile 9,180 boe/d 74% royalty production 63% oil and NGL 2015 forecast* 9,800 boe/d 68% royalty production 59% oil and NGL Our oil-weighted Light and medium…
  39. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 39
    Freehold Ownership TSX : FRU 74.9 mm shares outstanding (December 31, 2014) Insider holdings CN Pension Trust Funds 19.8 mm (26.5%) Rife: 4.9 mm (6.5%) (included in above number for CNID) Institutional (60%) Canadian (86%)…
  40. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 40
    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…
  41. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 41
    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…
  42. INVESTOR PRESENTATION – Freehold Royalties Ltd. – slide 42
    Investor Relations toll free. 888.257.1873 telephone. 403.221.0833 website. freeholdroyalties.com

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