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Highlights

  • Franco-Nevada has a diverse streaming and royalty portfolio by operator, country, and asset
  • The debt-free company closed FY23 with USD 2.4 billion in available capital
  • BlackRock Advisors, LLC holds the maximum stake in the firm with a shareholding of approximately 7.12%

Franco-Nevada Corporation (TSX: FNV) is a gold-focused royalty and streaming company, boasting the most extensive and diversified array of cash-generating assets. With a debt-free status, the company utilises its cash flow to broaden its portfolio and distribute dividends. Its shares trade under the symbol FNV on both the Toronto and New York stock exchanges.

The pipeline of precious metal and diversified opportunities, along with long-life reserves and resources, offers long-term growth to the company.

The company posted a 7.3% YoY decline in revenue to USD 1,219 million in the financial year 2023 (FY23) ended 31 December 2023, mainly because of lower volume and lower average realized gold prices.

In the reported period, gross profit declined by 10.1% YoY to USD 766.6 million, partially offset by higher cost of goods sold. The period saw a net loss of USD 466.4 million, compared to USD 700.6 million in net income in FY22. The company incurred losses primarily due to impairment losses and lower gross profit.

During FY23, the company reported approximately USD 1 billion in operating cash flow. Moreover, the quarterly dividend was increased by 5.88% to USD 0.365/ share, effective 1Q2024.

As of 31 December 2023, the company had USD 2.4 billion in capital and was virtually debt free.

Top 10 shareholders of FNV

The top 10 shareholders of FNV have around 37.67% shareholding in the company, while the top four have nearly 22.78% shareholding in the company.

BlackRock Advisors, LLC holds the highest stake in the company with a shareholding of approximately 7.12%, and the second highest stake is held by Fidelity Management & Research Company LLC with a shareholding of 5.96%. 

Outlook

In 2024, total GEO sales are expected at 480,000 – 540,000. The performance is likely to be driven by contributions from new mines including Salares Norte, Greenstone and Tocantinzinho.

The company anticipates registering sales of 540,000 – 600,000 GEOs in 2028 of which 385,000 – 425,000 GEOs are expected from precious metal assets.

Share performance of FNV

FNV shares closed 1% down at CAD 162.65 apiece on 3 April 2024. In the last 12 months, FNV’s share price has decreased by 19.50%, while in the past three months, it has surged by 9.49%.

The 52-week high of FNV is CAD 217.70, recorded on 4 May 2023, while the 52-week low is CAD 139.18, recorded on 12 December 2023.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is April 03, 2024. The reference data in this report has been partly sourced from EODHD/Others.