What Franco-Nevada (FNV) Said on Its Q3 Earnings Call

Key Points

• Q3 results improved despite lower sales volumes: Revenue rose 13% year over year to $549.3 million and adjusted net income increased 33% to $364.5 million, while gold equivalent ounces sold fell to 130,435.
• Franco-Nevada narrowed its 2026 GEO guidance to 525,000–555,000 and expects diversified revenue of $300 million–$330 million. The higher diversified revenue outlook reflects energy strength, driven mostly by prices, and guidance includes about 10,000 GEOs from Cobre Panamá stockpiles.
• The company reported $4.8 billion in available capital and no debt, and expects about $525 million from IAMGOLD’s buyback of half its Côté royalty. Management also expects to increase the dividend for a 20th consecutive year and sees an active deal pipeline.

Franco-Nevada NYSE: FNV reported higher third-quarter revenue and earnings as stronger gold and oil prices offset a decline in gold equivalent ounces sold. The company narrowed its full-year sales guidance and raised its outlook for diversified revenue, citing strength in energy.

Revenue rose 13% from a year earlier to $549.3 million, while adjusted EBITDA increased 15% to $493.9 million. Adjusted net income climbed 33% to $364.5 million, or $1.89 per share, Chief Financial Officer Sandip Rana said on the company’s Nov. 12 earnings call.

Total gold equivalent ounces, or GEOs, sold fell to 130,435 from 138,772 a year earlier. Precious metals GEOs were down 7%, at just over 110,000.

Rana said the company reversed $32.8 million of previously recorded tax expense after determining that a Barbados minimum top-up tax did not apply to it for 2024.

Energy Strength and Updated Guidance

Franco-Nevada narrowed its 2026 guidance for total GEOs sold to 525,000 to 555,000 and expects diversified revenue of $300 million to $330 million. President and CEO Paul Brink said the company was tracking toward the middle of its annual guidance range.

Rana said the increase in the diversified revenue outlook was entirely attributable to energy. While production has increased on some of the company’s lands, he said the majority of the revenue increase was driven by prices.

Diversified revenue rose 29% year over year to $86.8 million in the quarter, even as diversified GEOs slipped to 19,531 from 19,663. Rana attributed the small decline in GEOs to the conversion of revenue at a higher gold price. The company is now using a fixed gold price of $4,500 per ounce for that conversion.

Average gold prices were 24% higher than a year earlier, while silver prices rose 59%, Rana said. He added that West Texas Intermediate oil remained above $85 a barrel despite volatility.

Cobre Panamá Deliveries and Portfolio Performance

The updated guidance includes approximately 10,000 GEOs expected in 2026 from the processing of stockpiled ore at Cobre Panamá, which had not been included in the company’s original guidance. Franco-Nevada received and sold 3,716 GEOs from that processing in the third quarter.

Rana estimated that the company would receive approximately 27,000 to 28,000 GEOs in total from the stockpile, with the balance after 2026 likely arriving in the first two quarters of 2027.

Brink said a Panamanian ministerial commission recommended during the quarter that the government begin formal negotiations with First Quantum regarding Cobre. He said the response to an earthquake had since taken priority and expressed hope that the process would resume once that was addressed.

Rana said the company recorded a $10.6 million impairment reversal for the full amount of stockpile-processing GEOs it expects to receive. A further reversal would depend on the mine restarting, he said; if it reopened, a full reversal of the outstanding balance would be likely.

Elsewhere in the portfolio, South Arturo, Valentine and the new Casa Berardi stream provided strong contributions. Deliveries were lower at Guadalupe, Antapaccay and Cobre Panamá than a year earlier. Rana said heavy rainfall caused supply-chain issues at Guadalupe, preventing mining in higher-grade areas, while lower Antapaccay deliveries reflected timing.

Capital, Dividends and Deal Pipeline

Franco-Nevada had $4.8 billion in available capital and no debt as of Sept. 30, including $1.2 billion in cash, $2.25 billion under its credit facility including accordion provisions, and $1.3 billion in liquid marketable securities, Rana said.

After quarter-end, IAMGOLD gave notice that it would exercise its right to buy back 50% of the Côté gross margin royalty. Franco-Nevada expects to receive approximately $525 million in early December. Brink said the final amount could be slightly higher depending on interim payments, but not materially so.

The company paid $84.1 million in dividends during the quarter. Rana said management expects to raise the dividend for a 20th consecutive year, with the size of the increase to be decided with the board in January. The current dividend is $1.76 per share on an annualized basis.

Chief Investment Officer Eaun Gray described the deal pipeline as “exceptionally vibrant” and said he expects the company to be active over the next 12 months. He said opportunities span multiple regions and are increasingly skewed toward larger transactions.

Exploration and 2027 Outlook

Brink highlighted exploration at several properties, including the Porcupine complex, Stibnite, Gurupi and Musselwhite. At Porcupine, he said updated resources for Pamour and Dome are expected in early 2027. He also cited a Musselwhite drill intersection of 22.9 meters grading 10 grams per ton.

For 2027, Rana pointed to Eskay Creek, the continuing ramp-up at Valentine and a full year of Casa Berardi contributions as potential factors in GEO performance. He also noted a step-down at Candelaria and the reduction in Franco-Nevada’s Côté royalty interest following the buyback.

Franco-Nevada expects to release its year-end 2026 results after the market closes on March 9, 2027, with a conference call the following morning.

About Franco-Nevada (NYSE:FNV)

Franco-Nevada is a Toronto-based company that provides financing to mining and energy businesses in exchange for royalties, streams and other interests in production. Rather than operating mines itself, it gives partners capital and receives a share of revenue or future output from their projects. The company's portfolio is focused on gold and other precious metals, and also includes interests in other minerals and energy assets, including oil and gas. Its projects and counterparties span multiple regions, including North and South America, Africa, Australia and Europe.

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