Altius

Our Business

Corporate Information

Altius directly and indirectly holds diversified royalties and streams that generate revenue from 15 operating mines. These are located in Canada and Brazil and produce copper, zinc, nickel, cobalt, iron ore, potash and thermal (electrical) and metallurgical coal. The portfolio also includes numerous pre‐development stage royalties covering a wide spectrum of mineral commodities and jurisdictions. In addition, Altius holds a large portfolio of exploration stage projects which it has generated for deal making with industry partners that results in newly created royalties and equity and minority interests.

Altius has 43,002,726 shares issued and outstanding that are listed on Canada’s Toronto Stock Exchange. It is a member of both the S&P/TSX Small Cap and S&P/TSX Global Mining Indices.

Altius is focused on growing its royalty business through prospect generation and the creation and acquisition of royalties.

OUR ASSETS

Altius holds royalty interests in 15 producing assets in Canada that include a 4% NSR royalty on Hudbay's 777 copper-zinc mine in Manitoba, 6 potash mines and 5 coal mines located in western Canada,and a royalty on the Voisey’s Bay nickel-copper-cobalt mine in Labrador as well as a 3.7% "stream" interest in Yamana's Chapada Mine in Brazil. The Company also receives regular dividend income from is equity ownership in Labrador Iron Ore Royalty Company, which is treated as iron ore royalty revenue, being a pass-through vehicle. Collectively these royalties are anticipated to generate approximately $64 - 69 million in royalty revenue in 2018 as per the updated and increased guidance announced in March 2018 after the acquisition from Liberty increasing our potash royalties.

For additional information regarding each of the royalties please see the Royalties section of this website.

PROJECT OPERATOR *Last 12 Months ($ millions) COMMODITY MINE LIFE
ROYALTIES
Voisey's Bay VALE nil Ni-Cu-Co 20
777 Hudbay 13.2 Cu-Zn-Au/Ag 3
Genesee Westmoreland/Capital Power 6.8 Coal/Electricity 12
Paintearth Westmoreland/ATCO 0.5 Coal/Electricity 2
Sheerness Westmoreland/ATCO 6.0 Coal/Electricity 4-7
Highvale Westmoreland/TransAlta 1.3 Coal/Electricity 3
Cheviot Teck 2.7 Steelmaking Coal 9
Rocanville Potash Corp 4.5 Potash 69
Cory Potash corp 0.4 Potash 55
Allan Potash Corp 0.3 Potash 41
Patience Lake Potash Corp 0.1 Potash 49
Esterhazy Mosaic 1.4 Potash 136
Vanscoy Agrium 0.1 Potash 83
CDP various 1.2 Potash/coal bed methane 50+
IOC (LIF:TSX) Iron Ore Company (IOC) 7.1 Iron Ore 26
STREAM
Chapada Yamana Gold $16.1 Copper (Cu) 28
TOTAL as of Dec 31, 2017 $61.7

The Company also holds several other royalties on projects ranging from "shovel ready" development stage to exploration stage which it has primarily created as part of its original, and core project generation exploration business. The project generation pipeline contains a diversified portfolio of exploration stage projects and royalties, many of which are currently being advanced through various partner-funding arrangements.

JUNIOR EQUITIES PORTFOLIO

Altius has also built a portfolio of directly and indirectly held junior resource investments that have been generated from founding and earn in option related payments through its joint venture strategy to advance projects as well as selective investing in other top quality juniors employing a project generation and joint venture business model. As of September 30, 2018, the net market value of Altius’s portfolio of public junior company equities was approximately $68 million from a starting base of approximately $33.4 million on May 1, 2017. This net increase in portfolio value is mainly mark-to-market appreciation, with the addition of approximately $5 million to increase the ownership of Alderon Iron by ~15% as announced in March 2018.

Business Strategy

After 20 years, Altius has successfully evolved into a diversified mining royalty company generating >$60 million per year in royalty revenue across its portfolio of 15 producing royalties. Even with this added financial capability, the Company remains committed to managing risk and exercising financial discipline. While Altius continues to seek out royalty acquisition and/or royalty financing opportunities to augment its current portfolio, the current early stage bull market in base metals has created opportunities to generate significant shareholder value in the Company's exploration and project generation business, which is where Altius began. Altius generated nearly 2 million hectares of prospective lands in several Tier 1 jurisdictions covering the commodities spectrum during the bear market of 2012-2016 that has since resulted in vend out of 57 properties in 16 new deals. The quality and quantity of Altius' exploration portfolio is the best it has been in its 20 years of business.

Altius' business model is simple and has been implemented as an effective means of managing risk. It involves a small team of people that conceptualize and innovate mineral resource related opportunities, invest in their initiation and development and, when successful, form businesses or partnerships around these opportunities and create royalties. The model has worked well by allowing exposure to multiple opportunities while minimizing negative impacts to the capital structure of the company all the while creating royalties at a zero to often negative cost for future benefit to all shareholders. Earnings generated from the prospect generation business are either re-circulated into the exploration business or used to acquire third party royalties to augment the internally generated royalties held by the business.

A Virtuous Cycle of Royalty Growth and Creation

A Virtuous Cycle of Royalty Growth and Creation

A Growing Project Generation Business

The Benefits of Project Generation:

  • A portfolio of 26 public junior company equities that have resulted primarily from the vend-out of a large bank of global exploration lands that was aggressively built during mining sector down-turn - http://altiusminerals.com/projects/junior-equities
  • As of the end of the October 2018 in excess of 23 km of exploration drilling has been carried out by junior exploration companies (where we have a royalty and/or >10% interest) in the Altius portfolio during the year while we anticipate at least another 51 km of drilling via ongoing or announced programs.
  • The portfolio not only exposes shareholders to the wealth creation generated by discovery but also organically creates royalties generally at a free to negative cost to the Company.
Altius Global Exploration Land Bank Altius Exploration Project Areas

Capital Structure

Financial discipline and protection of capital structure are enduring hallmarks of Altius business plan and serves as the platform for its continued growth. Altius balances its capital allocation between debt repayment, shareholder capital returns (via dividends or share buybacks), direct royalty acquisition opportunities and low cost exploration initiatives. In April 2015 the Company initiated a dividend of $0.08 / share per year which it later increased to $0.12 / share and most recently (see announcement December 12, 2017) to $0.16/share.

Officers and directors of the company hold approximately 5% of the issued shares, providing powerful incentive to those at the helm to continue to enhance the shareholder value of the business. The Company also has a continual Normal Course Issuer Bid ("NCIB"). The reason for the bid is that when the market price of Altius shares is trading below the fundamental value of Altius, based on anticipated cash flows and underlying asset values, the acquisition of common shares under the bid represents an appropriate use of funds.

Market Facts As of March 28, 2018
Common Shares Issued 43,215,026
Fairfax Preferred Shares 10,000,000
Options 465,323
Warrants (@$14) 400,000
Fairfax warrants (@$15) 6,670,000
Fully Diluted 50,750,349
Annual Royalty Revenue ~$64-69 million
Annual Dividend $0.16 per share
Total Debt $128 million
Cusip # 020936

Committed to ethical business conduct

Altius and its subsidiaries and affiliates are committed to conducting business with people in the same respectful manner and applying the same ethical principles and standards that we would expect and seek from others. The employees, officers and consultants of Altius Minerals Corporation represent Altius and are expected to always act in a manner that enhances the reputation of the company for honesty, fairness, competency and professionalism. The integrity of Altius relies upon the uncompromising personal integrity of each employee. This Code of Conduct applies to employees, officers and consultants of Altius, and to anyone retained by Altius in a similar capacity. It is the responsibility of each employee to use common sense and apply high personal ethical standards in cases where there is no corresponding guideline in this Code of Conduct. While Altius expects the best from each employee, senior personnel are expected to lead by example.

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Corporate Disclosure

This policy establishes procedures which are designed: (i) to permit the disclosure of information about Altius Minerals Corporation (Altius) to the public in an informative, timely and broadly disseminated manner in accordance with all applicable legal and regulatory requirements, (ii) to ensure that non-publicly disclosed information remains confidential, and (iii) to ensure that trading of the Company's securities by directors, officers and employees of Altius, its affiliates and subsidiaries remains in compliance with applicable securities laws and restrict trading by persons who have Material Information about Altius which is not publicly disclosed. The implementation of these policies and procedures is important to develop sound disclosure practices and maintain investor confidence, as well as complying with securities laws and stock exchange rules on disclosure and trading.

This policy has been approved by the directors of Altius.

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Commitment to Safety

Altius' Board, Officers, Managers and Employees are committed to health, safety and mitigation of the environmental footprint resulting from our varied mineral exploration activities.

Altius' employees are required to adhere to all aspects of the Company's Health and Safety program to ensure that not only they, but their coworkers as well as contractors, consultants, observers and visitors remain healthy and safe at all times. Safety policies, procedures and regulations have been established for all individuals and/or companies involved in our activities. However, should an affiliate have policies superior to those of Altius, the higher standard will be followed and vice versa.

Since inception of the Altius health and safety program in 2005, Altius has remained compliant with the Occupational Health & Safety Legislation and strives to exceed minimum requirements. Altius considers its health and safety program to be a "living document" that will change, update and adopt to meet with our own ever increasing health and safety standards as well as the evolving culture of safety in our industry and workplace.

To summarize, Altius:

  • has successfully maintained PRIME status since 2005.
  • has successfully completed a Newfoundland and Labrador Workplace Health and Safety Compensation Commission Occupational Health and Safety audit in 2011
  • has never had any lost days from work due to injury days since inception in 1997.
  • has received national safety awards for 2008 and 2009 from The Association for Mineral Exploration British Columbia (AMEBC) / Prospectors & Developers Association of Canada (PDAC).
  • staff is properly trained with respect to Occupational Health & Safety (OH&S) Legislation, Regulations and safe work practices.
  • not only follows provincial guidelines, but adheres to national mineral exploration best practices with respect to health, safety and the environment.
  • is a recognized leader in the field of environmental mitigation and mineral exploration best practices.
  • wants to ensure to that all employees, contractors, consultants, observers, visitors, etc., remain healthy and safe regardless of the activity

Confirmed this 12th day of May 2015 by

Brian F. Dalton, Altius President and CEO
Rod Churchill, Employer Co-Chair; Altius Occupational Health and Safety Committee
Jeff Morgan, Employee Co-Chair; Altius Occupational Health and Safety Committee
Carol Seymour, Secretary; Altius Occupational Health and Safety Committee

© Copyright 2018 Altius Minerals Corporation