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Altius Minerals is a diversified mineral and renewable energy royalty platform focused on long life assets with exposure to global growth trends. The company’s portfolio is tied to the following themes:

Over its near-30-year history, Altius has developed a track record of successful organic royalty creation and a disciplined approach to new investments:

Altius is beginning a multi-year revenue inflection supported by new lithium, renewable energy, and copper royalties as well as expansion projects. We estimate a 31% CAGR in adj. cash flow per share from 2026-2030, which can be redeployed into new royalty investments (a sustainable feedback loop).

Altius Minerals manages a large and diversified royalty portfolio concentrated in minerals (potash, copper, iron, lithium, etc.) and renewable energy (wind, solar, battery storage). More importantly, the company focuses its investments on long-life assets with exposure to global growth trends – including food security (13% of NAV), industrialization (17% of NAV), and electrification (60% of NAV). The platform screens favourably from a jurisdictional perspective as well, with 71% of our NAV tied to North American assets. With a 30+ year history of structuring transactions, management has established a strong track record of capital deployment.

The combination of existing royalty expansion, prior royalty investments nearing commercial production, and the recent acquisitions of Lithium Royalty Corp. and the remaining stake in Altius Renewable Royalties (LRC & ARR, more on these later) should drive a material acceleration in royalty revenue through the coming years. We expect the compounding effect inherent in the business model to be evident through this period – as increased royalty revenue generates more cash for royalty investments (a sustainable feedback loop).

Unlike some other royalty peers, Altius is patient in its approach to capital allocation – waiting for negative sentiment in attractive end markets instead of chasing a hot commodity. Investing in these conditions allows the company to underwrite deals at more attractive terms. Over time, the structural demand drivers underpinning each asset create a more attractive investment environment for the operators – driving organic growth over and above what Altius based its initial investment on. Its investments in potash and the Chapada copper mine are clear examples of this: both were made near the bottom of the cycle and are now benefitting from expansion projects that increase Altius’ royalty base.

Through its Project Generation (PG) business, Altius can also create new royalties organically. It accomplishes this by conducting the initial prospecting work and then vending out the project to a junior mining company to continue exploration activity. In exchange for the project, Altius can negotiate a royalty on the asset and an equity position in the partner – making the PG business a low-cost royalty source while retaining exploration upside. The Kami iron ore project (more on this later) is a perfect example of the upside potential embedded in PG, with a ~$2M investment representing a >70x return based on consensus NAV estimates – which we believe are overly conservative.

Over time, Altius has accumulated a sizeable portfolio of equity stakes in junior miners – which stands at $80M as of Q2. Management can elect to monetize these equity stakes to realize value, with the resulting liquidity events providing cash for the company to redeploy into new royalty investments or M&A. The most recent example of this is Orogen Royalties, who was acquired by Triple Flag in 2025 for its 1% royalty on the Arthur Gold project – netting Altius a gain of $64M while retaining a ~17% stake in the spun off Orogen business.

Separately, Altius owned a 1.5% royalty on the same Arthur Gold project which it originally acquired for US$300K through the PG business. Shortly after the Orogen deal, Altius monetized 1% of its royalty stake (retained 0.5%) – selling it to Franco-Nevada for a total consideration of US$275M. $173M of that capital was subsequently redeployed into the company’s $520M acquisition of Lithium Royalty Corp. (LRC), reducing the funding burden and illustrating the role the PG business can play from a capital recycling perspective. Earlier in July (roughly half a year later), Altius acquired the remaining 43% stake in ARR for US$168M – reinforcing the strategic value of liquidity events the PG business can generate. Following a ~$182M bought deal to help finance that transaction, Altius should have more than $300M of available liquidity to support future investments - with additional capacity coming from an increase to the credit facility.

Managing the PG portfolio isn’t the only way Altius can fund new royalty investments internally. With the company expecting a step change in royalty revenue over the coming years, the cash flow profile of its existing investments should follow suit – providing it with a steadily growing, reliable source of balance sheet capacity (we model a 31% CAGR in adj. cash flow per share through 2030).

For where Altius is today, this is the most important concept to understand in our view. Unlike mine operators or renewable energy developers, the royalty model compounds. Royalty revenues fund new investments, which increase royalty revenues, which fund new investments – the platform feeds on itself. While Altius has been compounding for years, the wave of growth coming over the medium term is more pronounced than in previous periods – unlocking larger investment opportunities for the company.

To dig into the drivers behind this inflection in royalty revenue, we break down Altius’ primary end market exposure in the following sections (for an asset-level breakdown, go to their website). Each of the company’s major exposures has similar characteristics – a durable demand driver, forecasted supply deficit, and meaningful leverage to higher prices given Altius has no CapEx burden.

Altius owns six main royalty interests in potash, all of which are linked to producing mines in Saskatchewan. Five of the six assets are owned by Nutrien, with the remaining mine owned by Mosaic (the two companies account for >90% of North American production). Since the investments were made, Altius has benefitted from:

Based on current production plans, Altius expects a step up in revenue in 2026 and 2027 - with steady growth through 2035 based on a “market share hold” assumption.

While this revenue build will fluctuate based on the price environment, the long-term demand outlook for the agricultural commodity is structural – given the positive correlation between food supply and GDP per capita.

Framed differently, agricultural land per capita is declining as a function of population growth. At the same time, food consumption per capita is rising across the globe. These two dynamics underpin the importance of maximizing crop yield, where potash (potassium) is irreplaceable in modern agriculture.

With expectations for population growth to continue for the next 50+ years, the floor is rising on potash demand. Some operators have announced capacity expansions as a result, but with projects taking anywhere from 7-10 years to spin up – committed supply may prove insufficient.

Without additional commitments, forecasts from industry players call for a growing supply deficit through 2040 – which would be supportive for potash prices and in turn, royalty revenue coming from the segment.

Should a supply deficit materialize, higher prices would be needed to incentivize brownfield expansions – with BHP’s expansion project at the Jansen mine implying an incentive price of $500/tonne for a 15% unlevered pre-tax return (greenfield projects would require even higher prices).

Underpinned by long-term demand for steel, Altius gets its iron ore exposure through two main investments:

While the Kami project is early stage, with a definitive feasibility study due by the end of this year and production expected to start in 2032 – its potential is massive. Altius expects the project could become its largest mine royalty by revenue, with a $40M+ run-rate based on current prices (over half of total royalty revenue in 2025).

While steel production ebbs and flows, the steelmaking process is gradually shifting from blast furnace (BF) to electric arc furnace (EAF) – a cleaner production method. That shift is expected to accelerate, with a large portion of the legacy BF fleet approaching the end of their useful lives. Given rebuild costs and the impact of carbon pricing, EAF is expected to become the dominant steel production process over the next decade.

Nippon has committed to this transition, undertaking a US$6B investment program to progressively replace its blast furnace fleet with electric arc furnaces – making its investment in Kami strategic more than financial. That’s because EAF production requires high-purity iron ore (DR-grade, >67% iron content), meaning its growing usage should drive share gains in the DRI production process. That’s positive for Altius, given both of its iron ore investments are in the Labrador Trough – one of the premier regions globally for DR-grade production.

With the vast majority of today’s iron ore production not meeting the purity threshold for EAF steelmaking, Champion Iron expects a meaningful supply gap in DR-grade iron ore by the time Kami is ready for commercial production – supporting a strong price environment as Altius starts receiving royalty revenue.

Altius bulked up its lithium exposure in 2025 through the $520M acquisition of LRC, a company it was a founding investor in alongside Waratah. At the time of that investment, the company believed lithium could emerge as a mainstream industrial metal with electricity-based applications. The eventual takeout reflects the maturation of these end markets as well as management’s disciplined investment strategy, with lithium prices near cyclical lows at the time the deal was announced.

The lithium segment generated more than $5M of revenue in Q1 driven by its four operating royalties located in Mali, Brazil, and Argentina. The production ramp at these mines is ongoing, providing ample runway for top line growth before they reach steady-state production – with additional contribution from royalties coming online through 2030. Given historic volatility, the biggest unknown is pricing – with the gap between analyst estimates and current spot prices representing ~$30M in 2028.

While we model towards the lower end of that range to be conservative, there’s plenty of reason to believe there could be upside in price expectations – with demand for lithium batteries showing no signs of slowing. While electric vehicles were the first and remain the primary driver, battery energy storage systems (BESS) are a second growth vector – scaling from near-zero in 2020 to ~240 GWh deployed in 2025 (15% of total). That growth should continue as an offset to the intermittent nature of renewable power projects and as a stationary power source for data centres.

With industry calling for 4.5Mt of Lithium Carbonate Equivalent (LCE) demand by 2035, committed and probable supply additions would be nowhere near enough to close the gap – forcing prices higher without an adequate response from industry.

Altius’ lithium portfolio is well positioned for this potential supply deficit, with new royalty assets like Neves approaching commercial production rapidly (Q4/27 target, ~1.5 years from FID) and existing assets like Tres Quebradas planning to double production to support demand growth.

Today, Altius generates nearly all its copper royalty revenue from the Chapada mine in Brazil – with a smaller contribution from Voisey’s Bay in Canada (the first royalty interest Altius ever acquired in 2003). While higher copper prices are the primary driver of the 2026 forecast, growth through 2030 should be driven by:

Underpinning these CapEx cycles from mine operators is an unrelenting demand for the red metal – which is critical to grid infrastructure, construction, and technology among other end markets. In the coming decades, electrification is expected to be the primary growth driver – with core economic use cases (i.e. construction), data centres, and defense spend contributing too.

At the same time, average copper grades have been declining – with BHP calling out a ~40% drop since 1991. Combined with expectations for increased all-in sustaining costs (S&P Global estimates a 24% increase in 2030-2035 versus the 2021-2024 average), higher copper prices are likely necessary to incentivize the large-scale capital programs needed to meet demand growth. Anything incremental is upside for Altius, who underwrote its two primary copper investments at sub-$3 per pound.

While the mineral royalty business is well understood by investors, its renewable energy segment is unique – both in its corporate structure and in how investments are underwritten. Altius increased its exposure earlier this month through its US$168M acquisition of the remaining 43% stake in Altius Renewable Royalties (ARR), which owns 50% of Great Bay Royalties (GBR) – the company that makes the investments. GBR was originated in 2018, with the goal of bringing the royalty financing model to electricity generation – given the structural similarities the industry shares with mining:

GBR’s royalty portfolio stands at 3.3 GW of operating assets, 1.6 GW of under construction projects, and 3.8 GW of development assets – creating meaningful runway for revenue growth through 2030 (over 3x 2025). There could be further upside to these numbers – given market sentiment is enabling GBR to invest in later stage projects. Its recent US$73M investment in the 311 MW Coles Wind project is a perfect example, with the deal being GBR’s largest single asset royalty acquisition to date and contribution expected to start in 2027.

Like food consumption (potash), energy consumption per capita is strongly correlated with economic prosperity – underscoring the durability of renewable energy as an end market (electrification metals too).

In the near-term, US power demand has picked back up – with the IEA estimating electricity consumption grew at a 2.1% CAGR from 2020 to 2025 (322 TWh). For the 2025 to 2030 forecast period, power consumption is expected to grow by another 426 TWh – driven by data centers, reshoring, and transportation. To meet that demand, renewable production is taking share – thanks to the speed with which the projects can be built.

Like the other commodities where Altius plays, both spot prices and Power Purchase Agreement (PPA) prices have risen dramatically in recent years – benefitting royalties with merchant power exposure (24% in 2026, 76% in 2040) and incentivizing repowering/recontracting, should it hold over a longer time horizon.

As stated earlier, the way GBR structures its investments is completely unique – with the company negotiating variable rate royalties that lock in their target returns before first power. How this sliding scale works in practice depends on whether GBR is doing an asset-level deal or a developer deal on a portfolio of assets.

More recently, GBR structured a second program to address the growing logjam in US interconnection queues – which have resulted in project delays and an increase in withdrawals in recent years. The queue is particularly costly for developers, who are forced to make a deposit to secure their spot in line – diverting much-needed capital away from activities that advance the portfolio.

Given these interconnection deposits are relatively small ($5-10M), banks aren’t typically interested in lending against them. Seeing the opportunity, GBR has issued letters of credit (we assume over US$200M deployed) to help developers secure their place in the queue without tying up scarce capital – which benefits the company in two ways:

While small relative to expected renewable royalty revenue, the interconnection deposit program should be a consistent contributor and once again showcases management’s structured financing acumen.

As highlighted in the previous sections, we anticipate strong revenue growth in 2026 - with our attributable royalty revenue estimates up ~70% Y/Y. Underpinning that growth forecast is contribution from the lithium segment post-LRC close, a step change in revenue from renewable royalties, and a more favourable price environment in most end markets. In 2027 we expect more of the same (~30% Y/Y growth), with the start of production at Curipamba also contributing to results. Given the capital light nature of the Altius model, we expect much of this revenue growth will flow through – driving EPS and FCF to more than double 2025 levels by the end of 2027.

Given the attractiveness of each end market Altius plays in, management’s track record of value-creating transactions, the near-term inflection in royalty revenue, and several exciting development/expansion projects – Altius trades at 1.2x our NAV estimate versus a peer group average of 1.0x (range of 0.7x-1.4x). In our view, this premium is justified on management’s track record alone – and it provides the company with additional financial capacity should it want to pursue another LRC-sized transaction in the future.

Assuming the valuation premium holds, Altius has multiple fundamental drivers of NAV that represent upside potential from here – both gradual (cash per share growth), event-driven (PG monetization, Kami DFS, development projects, M&A), and market-dependent (higher price assumptions). On cash, we’d expect any PG monetization and subsequent redeployment into a royalty acquisition to be treated favourably by investors (riskier junior equity to defined cash flow stream). Even without PG, the FCF profile of the existing royalty base should drive meaningful growth in cash per share through our forecast period – with our 2030 estimate of nearly $8 per share representing ~$9 of NAVPS (nearly 20%) using the current 1.2x multiple. Assigning a market multiple to the cash balance is appropriate in our view, given it represents management’s ability to deploy that cash effectively in the future – which we can’t forecast directly.

From an event-driven perspective, any new capital deployment initiatives (asset-level royalties, platform acquisitions, etc.) would likely drive consensus NAV estimates higher. Progress on key development projects would also move the needle, as much of the company’s production starts post-2030 are left out of NAV estimates (or have a higher discount rate applied to them).

The Kami project has the nearest catalyst, with a definitive feasibility study coming later this year that could result in an improved reserve estimate. More importantly, the DFS represents a de-risking event – unlocking the rest of Sojitz and Nippon’s committed capital and advancing Kami towards FID. As progress is made, we expect the asset’s true value will be reflected in street estimates – driven mainly by a reduction in discount rate from 8% to the typical 5%. That reduction alone would increase our total ALS NAV by ~6%, which likely understates the impact on consensus – given our NAV estimate for Kami is above street estimates.

Outside of the fundamental drivers of forward returns, management is committed to returning capital to shareholders through an opportunistic approach to buybacks and an above average dividend yield. Having grown its quarterly distribution for nearly ten years straight, shareholders can likely bank on annual distribution hikes barring any adverse developments within the portfolio.

Established in 1997, Altius remains a founder-led company – with co-founders John Baker and Brian Dalton serving as President and CEO today, respectively. According to Bain, founder-led companies outperformed the S&P 500 by ~2x from 2015-2025 and ~3x from 1990-2014. The leadership team is tenured, with incentive compensation tied to per share metrics, operational milestones, and share performance among other things.

The company’s register tells a similar story, with insiders owning over 4% of shares outstanding – and several notable investors with large positions. In order of position size Fairfax (11%), Waratah (6%), and Fidelity (5%) are all holders, with Fairfax taking exposure to Altius first in 2017.

In addition to general risks associated with investing, we highlight the following company-specific risks:

Commodity risk: Altius’ royalty stream is derived as a percentage of top line revenue, which itself is a function of commodity prices and demand. Lower commodity prices and/or slowing demand may negatively impact the assets which underpin the royalty portfolio.

Asset depletion risk: Mines are naturally depleting assets and the royalties on which they are based will cease once the mine is exhausted or otherwise closed. Altius will need to make ongoing investments to replenish its royalty portfolio. There is no guarantee that Altius will be able to do so on terms acceptable to the company.

Operator risk: Altius is neither the mine/project owner nor operator of the properties underlying its royalty portfolio and has no input on how the operations are conducted. The data accessible by the company is varying, which could impact Altius’s ability to monitor a given royalty interest and assess its value.

Competitive risk: Altius operates in a competitive industry with peers that are larger and/or have better access to capital. While the company focuses on less competitive markets (i.e. non-precious metals), peers may be willing to offer financing terms that are unattractive for Altius, limiting its pool of investment opportunities.

Development risk: While Altius is not the operator of the mine/project, delays or cancellations in the permitting, development, and/or construction process of the asset may adversely impact future royalty revenue and lead to lower than anticipated returns.

Partnership risk: Altius has limited personnel and its Project Generation business is dependent on the ability to attract exploration partners to develop prospected land into commercially viable projects. An inability to attract partners could hinder business development and adversely impact future royalty origination.

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