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Franco-Nevada Reports Q2 2013 Results



                    Franco-Nevada Reports Q2 2013 Results

PR Newswire

TORONTO, Aug. 7, 2013

TORONTO, Aug.  7, 2013  /PRNewswire/ -  Franco-Nevada Corporation  (TSX:  FNV; 
NYSE: FNV) today reported its financial  results for the second quarter  ended 
June 30, 2013.

Highlights include:

  * Net income of $21.6 million or $0.15 per share;

  * Adjusted EBITDA of $75.2 million or $0.51 per share;

  * Three gold royalty transactions completed for $62.0 million;

  * Working capital at end of quarter of $835.8 million and no debt;

  * Tom Albanese, former CEO of Rio Tinto plc, joins the Board; and

  * Dividend reinvestment plan adopted.

"Franco-Nevada's royalty business model has  proven robust despite lower  gold 
prices. Cash-flow generation remains very  strong and no material  impairments 
have been recognized. Operations  are profitable and  performing in line  with 
our expectations  with  no  changes  to our  previous  guidance,"  said  David 
Harquail, President and CEO.  "For the second half of the year, we are looking
forward to the ramp-up of production at Detour Lake and Peculiar Knob and  the 
start of production at Duketon-Rosemont.  We are also looking forward to First
Quantum's revised  plans for  the Cobre  Panama project  now expected  in  the 
fourth quarter and the possible  permitting of the Augusta-Rosemont  project.  
We continue  to  add  small gold  assets  to  the portfolio  and  expect  more 
investments will be closed this year.  I personally would like to welcome  Tom 
Albanese who  will add  further strength  to an  already strong  Franco-Nevada 
board."

Financial Results

Gold Equivalent Ounces^(1) ("GEOs") earned  by Franco-Nevada from its  royalty 
and stream mineral interests for the three and six months ended June 30,  2013 
were 53,292  and 111,580,  respectively, representing  decreases of  8.7%  and 
2.0%, respectively, over the comparable periods in 2012. In addition, the  oil 
& gas  assets generated  $18.2  million and  $32.1 million,  respectively,  in 
revenues during the same periods compared  to $9.0 million and $19.5  million, 
respectively, in 2012. Revenue was earned  77% from precious metals (67%  gold 
and 10% PGMs) and 81% from North America and Australia (33% Canada, 21%  U.S., 
22% Mexico and 5% Australia).

For the second  quarter, the Company  earned net income  of $21.6 million,  or 
$0.15 per share,  compared to  $36.9 million, or  $0.26 per  share, in  2012.  
Adjusted Net Income^(2)  was $31.9 million,  or $0.22 per  share, compared  to 
$35.1 million, or $0.24 per  share. Net income for  the six months ended  June 
30, 2013 was $57.0 million, or  $0.39 per share, compared with $83.7  million, 
or $0.59 per  share, in 2012.  Adjusted Net Income^(2)  was $72.5 million,  or 
$0.49 per share, compared with $78.7 million, or $0.55 per share, in 2012.

Revenue was $93.3 million (2012 -  $102.7 million) and $202.1 million (2012  - 
$207.7 million)  for  the  three and  six  months  ended June  30,  2013.  The 
decreases were due  to lower  average gold  prices and  lower production  from 
Goldstrike, Palmarejo and Bald Mountain, partially offset by higher production
from Subika,  Gold Quarry  and Peculiar  Knob and  higher oil  & gas  revenue. 
Adjusted EBITDA^(3) was  $75.2 million (2012  - $82.5 million),  or $0.51  per 
share (2012 - $0.57 per share), and $164.3 million (2012 - $167.9 million), or
$1.12 per share (2012 - $1.18 per  share), for the three and six months  ended 
June 30, 2013, respectively.

As at June 30, 2013, Franco-Nevada  had cash, cash equivalents and  short-term 
investments  totaling  $797.0  million  and  working  capital^(4)  of   $835.8 
million.  In addition,  the Company  has available an  undrawn $500.0  million 
unsecured revolving credit  facility bringing available  capital to over  $1.3 
billion.

New Royalty Acquisitions

  * Sissingue - Rest of World: On May 29, 2013, Franco-Nevada, through a
    wholly-owned subsidiary, acquired a 0.5% net smelter return ("NSR")
    royalty on certain tenements that comprise the Sissingue gold project
    located in Cote d'Ivoire and operated by Perseus Mining Limited. The
    purchase price was Australian $2.0 million in cash.

  * Brucejack - Canada: On May 13, 2013, the Company closed the previously
    announced acquisition of a 1.2% NSR covering Pretium Resources Inc.'s
    Brucejack gold project located in northwestern British Columbia for $45.0
    million in cash.

  * Golden Meadows - U.S.: On May 9, 2013, the Company closed the previously
    announced Golden Meadows transaction whereby a wholly-owned subsidiary of
    Franco-Nevada acquired a new 1.7% NSR on the Golden Meadows project from
    Midas Gold Corp. The total consideration was $15.0 million.

Quarterly Portfolio Highlights

  * Gold - U.S.:  Gold revenue was $13.9 million, or 9,946 GEOs, during the
    quarter, a decrease of $12.9 million, over Q2 2012 revenue of $26.8
    million, or 16,600 GEOs, which was attributable to an overall lower
    average gold price and lower production levels at Goldstrike and Bald
    Mountain partially offset by higher revenue at Gold Quarry due to an
    increase in the minimum royalty provision.  Barrick Gold reported lower
    production at Goldstrike in the quarter due to the processing of lower
    grade ore at the autoclave facility partially offset by increased process
    throughput. Barrick expects higher production at Goldstrike in the second
    half of 2013.

    Augusta Resource Corporation continues to advance permitting of its
    Rosemont Copper project and has submitted its Environmental Impact
    Statement to cooperating agencies for final comments.  The Hollister mine
    was acquired by Waterton Global Mining Company LLC through a receivership
    process. The mine remained in operation through receivership and continues
    to be subject to Franco-Nevada's royalty.

  * Gold - Canada: Canadian gold assets generated  $7.9 million in revenue and
    5,503 GEOs with the largest contributor being the Golden Highway assets
    with $2.9 million in revenue and 2,087 GEOs. Revenue from the Company's
    Detour NSR totaled $1.2 million, or 872 GEOs, as ramp-up activities
    continue with commercial production expected to be achieved in the third
    quarter of 2013.

    Rubicon Minerals Corporation announced positive results from its
    preliminary economic assessment and an increase to its indicated mineral
    resources for part of its Phoenix Gold Project. Franco-Nevada holds a 2%
    NSR on the water claims of the Phoenix gold project. Pretium Resources
    Inc. released a positive feasibility study on the Brucejack project. A
    bulk sample for the Brucejack project is expected in the third quarter. 
    New Prosperity, on which Franco-Nevada has a stream agreement option, has
    entered the final stages of public review and final decision regarding
    permitting is anticipated midway through Q1/2014.

  * Gold - Australia: Gold revenue from Australian assets was $2.4 million in
    the quarter, or 1,711 GEOs, with the Duketon NSR contributing $2.0 million
    and 1,461 GEOs. The Duketon project includes the Moolart Well & Garden
    Well gold mines and the Rosemont Gold Project, operated by Regis Resources
    Ltd. ("Regis"). Regis announced an increase to the resources at Garden
    Well and plans for a plant expansion at Rosemont which is expected to
    commence commissioning in late September 2013. Regis expects the plant
    expansion to increase long-term gold production from both Garden Well and
    Rosemont. Franco-Nevada holds a 2% NSR on Duketon.

    Two of Franco-Nevada's smaller Australian assets, Bronzewing and Wiluna,
    have been negatively impacted by the lower gold price environment with the
    respective operators entering creditor protection.

  * Gold - Rest of World: Gold assets in the rest of the world generated $38.5
    million and 27,388 GEOs during the quarter compared with $42.7 million and
    26,466 GEOs in 2012. Growth was achieved from Subika, a royalty that
    surpassed a production threshold in mid-2012, and Mine Waste Solutions and
    Tasiast, both due to higher production volumes. Revenue and GEOs were
    lower from Palmarejo due to lower production and average gold prices.

    Eldorado Gold Corp. announced that it will delay production start of its
    Perama Hill project by one year to 2016 due to the lower gold price
    environment.

    First Quantum Minerals Ltd. announced that its detailed review of its
    Cobre Panama project continued during Q2 2013 and it expects a revised
    capital cost estimate and project timetable in Q4 2013.

  * PGM Assets: PGM assets earned $9.6 million in revenue, or 6,752 GEOs for
    the three months with higher production from Stillwater partially offset
    by lower production from the Sudbury assets.

  * Oil & Gas and Other Assets: Oil & gas assets generated $18.2 million in
    revenue, an increase of 102.2%, due to the 2012 acquisitions of an
    additional working interest and net royalty interest in the Weyburn Unit
    and higher average commodity prices. In addition, Peculiar Knob, an
    iron-ore royalty in Australia, contributed $1.9 million to revenue in the
    quarter.

2013 Guidance

For the three  and six months  ended June 30,  2013, attributable royalty  and 
stream production was  in-line with the  Company's expectations.  The  Company 
expects to receive a total of 215,000 to 235,000 GEOs from its mineral  assets 
and $55.0 to $65.0 million in revenue from its oil & gas assets in 2013.  Gold 
equivalent royalty and stream  ounces are estimated for  gross ounces, and  in 
the case of stream ounces, before  the payment of approximately $400 per  gold 
equivalent ounce paid by the Company. Platinum and palladium metals have  been 
converted to GEOs  using commodity prices  of $1,300/oz Au,  $1,425/oz Pt  and 
$750/oz Pd.  The WTI  oil price  is assumed  to average  $93 per  barrel  with 
similar price discounts for Canadian oil  as experienced in the first half  of 
2013.

Board Addition

The Board of Directors of Franco-Nevada  today welcomed Tom Albanese as a  new 
member of the Board.   Tom was previously the  Chief Executive Officer of  Rio 
Tinto plc from 2007 to January 2013  and brings a wealth of experience in  the 
mining sector to Franco-Nevada.  Tom currently serves as a member of the Board
of Visitors, Fuqua School of  Business, Duke University, North Carolina.   Tom 
has a Bachelor of Science degree in Mineral Economics and a Master of  Science 
degree in Mining Engineering.

Dividend Declaration and Adoption of Dividend Reinvestment Plan

The Board of Directors of Franco-Nevada declared the monthly dividend of $0.06
per share  for each  of  October, November  and  December 2013.   The  October 
dividend will be paid on October 31, 2013 to shareholders of record on October
17, 2013,  the  November  dividend  will  be paid  on  November  28,  2013  to 
shareholders of record on November 14, 2013 and the December dividend will  be 
paid on December 19, 2013 to shareholders  of record on December 5, 2013.  The 
Canadian dollar equivalent is determined based on the noon rate posted by  the 
Bank of Canada on  August 6, 2013.  Under  Canadian tax legislation,  Canadian 
resident individuals  who  receive "eligible  dividends"  are entitled  to  an 
enhanced gross-up and dividend tax credit on such dividends.

The Board  of Directors  is also  pleased to  announce the  introduction of  a 
dividend reinvestment  plan  ("DRIP").  Eligible  shareholders  may  elect  to 
participate  in  the   DRIP  commencing  with   the  October  2013   dividend. 
Participation in  the  DRIP is  optional.  Commencing with  the  October  2013 
dividend and  continuing  until  amended  by the  Board  of  Directors,  funds 
reinvested under the Plan will be by way of Treasury Acquisitions, as  defined 
in the DRIP,  and will  be issued  with a 3%  discount to  the Average  Market 
Price, as defined in the DRIP.  Enrollment forms will be mailed to  registered 
shareholders in September 2013. Enrollment  forms will also be made  available 
on the Company's website at www.franco-nevada.com. Registered shareholders may
also enroll in the dividend reinvestment plan online through the plan  agent's 
self-service web portal  at www.investorcentre.com/franco-nevada.   Beneficial 
shareholders  should   contact  their   financial  intermediary   to   arrange 
enrollment.

This press release is not an offer or a solicitation of an offer of shares  in 
the  United  States.  A  registration  statement  relating  to  the   dividend 
reinvestment plan  has  been  filed  with the  U.S.  Securities  and  Exchange 
Commission. A copy of  the prospectus included  in the registration  statement 
may be  obtained  under the  Company's  profile  on the  U.S.  Securities  and 
Exchange Commission website at http://www.sec.gov.

Shareholder Information

The  complete  Consolidated   Condensed  Interim   Financial  Statements   and 
Management's Discussion and  Analysis can  be found  today on  Franco-Nevada's 
website at www.franco-nevada.com, on  SEDAR at www.sedar.com  and on EDGAR  at 
www.sec.gov.

Management will host a conference call  tomorrow, Thursday, August 8, 2013  at 
10:00 a.m.  Eastern  Time to  review  the results.  Interested  investors  are 
invited to participate as follows:

  * Q2 Conference Call - 10:00 am ET: Local: 647-427-7450; Toll-Free:
    1-888-231-8191

  * Webcast: A live audio webcast will be accessible at www.franco-nevada.com.

A conference call replay will be available until August 15, 2013 at the
following numbers: Local: 416-849-0833; Toll-Free: 1-855-859-2056; Pass code:
14812376

Corporate Summary

Franco-Nevada is a gold-focused royalty and stream company.  The Company has a
diversified portfolio of cash-flow producing  assets and interests in some  of 
the largest development projects  in the world.   Its business model  provides 
investors with exploration  optionality while limiting  exposure to  operating 
and capital cost risks.  Franco-Nevada has  substantial cash with no debt  and 
is generating cash flow from  its portfolio that is  being used to expand  its 
portfolio and  pay monthly  dividends.   Franco-Nevada's common  shares  trade 
under the symbol FNV on both the Toronto and New York stock exchanges.

Prepared in  accordance  with  IFRS  and presented  in  U.S.  dollars  (unless 
otherwise noted).

                          FORWARD LOOKING STATEMENTS

This press release contains "forward looking information" and "forward looking
statements" within the meaning of applicable Canadian securities laws and  the 
United States  Private Securities  Litigation Reform  Act 1995,  respectively, 
which may include, but are not  limited to, statements with respect to  future 
events   or   future   performance,   management's   expectations    regarding 
Franco-Nevada's growth,  results  of operations,  estimated  future  revenues, 
requirements for  additional capital,  mineral  reserve and  mineral  resource 
estimates, production estimates, production  costs and revenue, future  demand 
for and prices of commodities,  expected mining sequences, business  prospects 
and opportunities. In addition, statements (including data in tables) relating
to GEOs are  forward looking  statements as they  involve implied  assessment, 
based on certain estimates and assumptions, and no assurance can be given that
the estimates  will  be  realized. Such  forward  looking  statements  reflect 
management's current beliefs and are based on information currently  available 
to management.  Often,  but not  always,  forward looking  statements  can  be 
identified by the  use of  words such  as "plans",  "expects", "is  expected", 
"budget",  "scheduled",  "estimates",  "forecasts",  "predicts",   "projects", 
"intends",  "targets",  "aims",  "anticipates"  or  "believes"  or  variations 
(including negative variations) of such words and phrases or may be identified
by statements to  the effect  that certain actions  "may", "could",  "should", 
"would", "might" or  "will" be taken,  occur or be  achieved. Forward  looking 
statements involve known and unknown  risks, uncertainties and other  factors, 
which  may  cause   the  actual  results,   performance  or  achievements   of 
Franco-Nevada to be materially different from any future results,  performance 
or achievements expressed  or implied  by the forward  looking statements.   A 
number of factors could  cause actual events or  results to differ  materially 
from  any   forward   looking  statement,   including,   without   limitation, 
fluctuations in the prices of the  primary commodities that drive royalty  and 
stream revenue (gold, platinum group metals, copper, nickel, uranium,  silver, 
iron-ore and  oil  & gas),  fluctuations  in the  value  of the  Canadian  and 
Australian dollar, Mexican peso,  and any other currency  in which revenue  is 
generated, relative to the US dollar, changes in national and local government
legislation, including permitting and licensing regimes and taxation policies,
regulations and political  or economic  developments in any  of the  countries 
where properties  in which  Franco-Nevada  holds a  royalty, stream  or  other 
interest are located  or through  which they are  held, risks  related to  the 
operators of the properties in which Franco-Nevada holds a royalty, stream  or 
other interest,  including  changes  in  the ownership  and  control  of  such 
operators, influence  of  macroeconomic developments,  business  opportunities 
that become available to, or are  pursued by Franco-Nevada, reduced access  to 
debt and equity capital, litigation, title, permit or license disputes related
to interests on any of the properties in which Franco-Nevada holds a  royalty, 
stream or other  interest, whether or  not the Company  is determined to  have 
PFIC status, excessive  cost escalation  as well  as development,  permitting, 
infrastructure, operating or technical difficulties  on any of the  properties 
in which Franco-Nevada  holds a royalty,  stream or other  interest, rate  and 
timing of production  differences from resource  estimates, risks and  hazards 
associated with  the  business  of  development  and  mining  on  any  of  the 
properties in which Franco-Nevada holds  a royalty, stream or other  interest, 
including,  but  not   limited  to  unusual   or  unexpected  geological   and 
metallurgical conditions,  slope  failures  or cave-ins,  flooding  and  other 
natural disasters or civil  unrest, and the  integration of acquired  assets.  
The forward looking statements contained in this press release are based  upon 
assumptions  management  believes   to  be   reasonable,  including,   without 
limitation, the ongoing  operation of  the properties  in which  Franco-Nevada 
holds a royalty, stream or other interest  by the owners or operators of  such 
properties in a manner consistent with  past practice, the accuracy of  public 
statements and  disclosures made  by  the owners  or operators  of  underlying 
properties, no material adverse change in the market price of the  commodities 
that underlie the  asset portfolio,  the Company's ongoing  income and  assets 
relating to  determination  of its  PFIC  status, no  adverse  development  in 
respect of any significant  property in which  Franco-Nevada holds a  royalty, 
stream or other interest,  integration of acquired assets  and the absence  of 
any other factors that could cause  actions, events or results to differ  from 
those anticipated, estimated or intended.  However, there can be no  assurance 
that forward looking statements will prove  to be accurate, as actual  results 
and future  events could  differ  materially from  those anticipated  in  such 
statements and readers are cautioned  that forward looking statements are  not 
guarantees of future performance.  Franco-Nevada cannot assure investors  that 
actual results  will  be consistent  with  these forward  looking  statements. 
Accordingly, readers  should  not  place undue  reliance  on  forward  looking 
statements due to the inherent uncertainty therein. For additional information
with respect  to risks,  uncertainties and  assumptions, please  refer to  the 
"Risk Factors" section of Franco-Nevada's Annual Information Form, as well  as 
Franco-Nevada's most recent  Management's Discussion and  Analysis filed  with 
the Canadian securities regulatory authorities  on SEDAR at www.sedar.com  and 
Franco-Nevada's most  recent Form  40-F  filed with  the U.S.  Securities  and 
Exchange Commission on EDGAR at  www.sec.gov.  The forward looking  statements 
herein are made as of  the date of this  press release only and  Franco-Nevada 
does not  assume  any obligation  to  update or  revise  them to  reflect  new 
information, estimates or  opinions, future  events or  results or  otherwise, 
except as required by applicable law.

FRANCO-NEVADA CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(unaudited, in millions of U.S. dollars)        
                                                                              
                                                                              
                                             June 30, 2013   December 31, 2012
                                                                              
ASSETS                                                                        
Cash and cash equivalents (Note 4)                 $ 758.2             $ 631.7
Short-term investments (Note 5)                       38.8               148.2
Receivables (Note 6)                                  63.9                83.4
Prepaid expenses and other                            18.5                15.9
     Current assets                                  879.4               879.2
                                                                              
Royalty, stream and working interests, net         2,168.7             2,223.6
Investments (Note 5)                                  68.4               108.4
Deferred income tax assets                             9.4                 8.7
Other                                                 26.7                24.0
                                                                              
     Total assets                                $ 3,152.6           $ 3,243.9
                                                                              
                                                                              
                                                                              
LIABILITIES                                                                   
Accounts payable and accrued liabilities                    
(Note 10(b))                                        $ 40.6              $ 44.0
Current income tax liabilities                         3.0                12.8
     Current liabilities                              43.6                56.8
                                                                              
Deferred income tax liabilities                       38.8                38.0
     Total liabilities                                82.4                94.8
                                                                              
SHAREHOLDERS' EQUITY (Note 10)                                                
Common shares                                      3,122.2             3,116.7
Contributed surplus                                   47.9                47.2
Deficit                                            (115.0)             (120.6)
Accumulated other comprehensive income                15.1               105.8
     Total shareholders' equity                    3,070.2             3,149.1
                                                                              
     Total liabilities and shareholders'                    
     equity                                      $ 3,152.6           $ 3,243.9

    The condensed notes are an integral part of these interim consolidated
 financial statements and can be found in our 2013 Q2 Report available on our
                                   website.

FRANCO-NEVADA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) 
(unaudited, in millions of U.S. dollars, except per share amounts) 
                                                                              
                                                                              
                                   For the three months    For the six months
                                      ended June 30,         ended June 30,
                                       2013         2012       2013       2012
                                                                              
                                                                             $
Revenue (Note 6)                     $ 93.3      $ 102.7    $ 202.1      207.7
                                                                              
Costs and expenses                                                            
  Cost of sales (Note 7)               13.9         15.6       29.0       31.2
  Depletion and depreciation           28.2         31.0       62.6       62.7
  Corporate administration                                            
  (Note 8 & 10(c))                      3.6          3.8        7.3        7.4
  Business development                  0.6          0.8        1.5        1.2
  Impairment of investments                                           
  (Note 5)                              4.5            -        5.9          -
                                       50.8         51.2      106.3      102.5
                                                                              
  Operating income                     42.5         51.5       95.8      105.2
                                                                              
  Foreign exchange
  gains/(losses) and other                                            
  income/(expenses)                   (9.3)        (2.6)     (14.0)        1.3
Income before finance items and                                       
income taxes                           33.2         48.9       81.8      106.5
                                                                              
Finance items                                                                 
  Finance income                        0.8          2.5        1.7        4.7
  Finance expenses                    (0.4)        (0.2)      (1.1)      (0.6)
                                                                             $
Net income before income taxes       $ 33.6       $ 51.2     $ 82.4      110.6
                                                                              
Income tax expense (Note 9)            12.0         14.3       25.4       26.9
                                                                              
Net income                           $ 21.6       $ 36.9     $ 57.0     $ 83.7
                                                                              
Other comprehensive loss:                                                     
Items that may be reclassified
subsequently to profit and                                            
loss:                                                                         
  Unrealized gain (loss) in
  market value of
  available-for-sale                                                  
  investments, net of income
  tax of $1.9 and $2.7 (Note 5)      (11.8)        (4.8)     (17.3)        1.2
  Currency translation                                                
  adjustment                         (49.2)       (25.2)     (73.4)      (7.2)
  Other comprehensive loss           (61.0)       (30.0)     (90.7)      (6.0)
                                                                              
Total comprehensive income                                        $   
(loss)                             $ (39.4)        $ 6.9     (33.7)     $ 77.7
                                                                              
Basic earnings per share (Note                                        
11)                                  $ 0.15       $ 0.26     $ 0.39     $ 0.59
Diluted earnings per share                                            
(Note 11)                            $ 0.15       $ 0.25     $ 0.39     $ 0.58

    The condensed notes are an integral part of these interim consolidated
 financial statements and can be found in our 2013 Q2 Report available on our
                                  website. 

FRANCO-NEVADA CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                 For the six months ended June
(unaudited, in millions of U.S. dollars)                     30, 
                                                           2013           2012
Cash flows from operating activities                                          
Net income                                               $ 57.0         $ 83.7
Adjustments to reconcile net income to net      
cash provided                                                                 
   by operating activities:                                                   
   Depletion and depreciation                              62.6           62.7
   Impairment of investments (Note 5)                       5.9              -
   Other non-cash items                                     0.5            0.1
   Deferred income tax expense (Note 9)                     3.2            5.7
   Share-based payments (Note 10(c))                        2.3            1.7
   Unrealized foreign exchange loss                         2.9            0.5
   Mark-to-market on warrants                               9.1          (2.6)
   Changes in non-cash assets and liabilities:                                
      Decrease in receivables                              19.5            6.3
      Increase in prepaid expenses and other              (5.2)         (12.5)
      Increase/(decrease) in accounts payable   
      and accrued liabilities                            (12.8)            4.5
Net cash provided by operating activities                 145.0          150.1
                                                                              
Cash flows from investing activities                                          
   Proceeds on sale of short-term investments             163.1          156.0
   Purchase of short-term investments                    (56.4)        (167.1)
   Acquisition of interest in oil & gas         
   properties                                                 -          (2.0)
   Acquisition of working interest in oil &     
   gas properties                                         (0.8)         (43.9)
   Acquisition of interests in mineral          
   properties                                            (61.8)         (40.0)
   Purchase of investments                                (0.3)         (18.6)
   Return of capital on investments                         1.8              -
   Purchase of property and equipment                     (0.9)              -
   Purchase of oil & gas well equipment                   (3.8)         (13.0)
Net cash provided by (used in) investing        
activities                                                 40.9        (128.6)
                                                                              
Cash flows from financing activities                                          
   Payment of dividends                                  (52.3)         (34.1)
   Credit facility amendment costs                        (1.5)               
   Proceeds from exercise of warrants                         -          179.3
   Proceeds from exercise of stock options                  4.0            1.2
Net cash provided by (used in) financing        
activities                                               (49.8)          146.4
Effect of exchange rate changes on cash and     
cash equivalents                                          (9.6)          (1.0)
Net increase in cash and cash equivalents                 126.5          166.9
Cash and cash equivalents at beginning of       
period                                                    631.7          794.1
Cash and cash equivalents at end of period              $ 758.2        $ 961.0
                                                                              
                                                                              
Supplemental cash flow information:                                           
Cash paid for interest expense and loan         
standby fees during the period                            $ 0.6          $ 0.5
Income taxes paid during the period                      $ 35.5         $ 22.8

    The condensed notes are an integral part of these interim consolidated
 financial statements and can be found in our 2013 Q2 Report available on our
                                   website.

FRANCO-NEVADA CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited, in millions of U.S. dollars)
                                                                              
                                                                              
                                                 Accumulated
                                                    other
                           Share    Contributed comprehensive          Total
                          capital     Surplus      income     Deficit  Equity
                         (Note 10)                                            
Balance at January 1,       3,116.7
2013                                       47.2         105.8 (120.6)  3,149.1
  Net income                      -           -             -    57.0     57.0
  Other comprehensive   
  loss                            -           -        (90.7)       -   (90.7)
  Total comprehensive   
  loss                            -           -             -       -   (33.7)
  Exercise of stock     
  options                       5.2       (1.2)             -       -      4.0
  Share-based payments            -         2.3             -       -      2.3
  Vesting of
  restricted share      
  units                         0.3       (0.3)             -       -        -
  Adjustment to         
  finance costs                   -       (0.1)             -       -    (0.1)
  Dividends declared              -           -             -  (51.4)   (51.4)
Balance at June 30,         3,122.2
2013                                       47.9          15.1 (115.0)  3,070.2
                                                                              
Balance at January 1,       2,803.6
2012                                       99.5          66.6 (135.5)  2,834.2
  Net income                      -           -             -    83.7     83.7
  Other comprehensive   
  loss                            -           -         (6.0)       -    (6.0)
  Total comprehensive   
  income                          -           -             -       -     77.7
  Exercise of stock     
  options                       1.7       (0.5)             -       -      1.2
  Share-based payments            -         1.7             -       -      1.7
  Exercise of warrants        201.5      (22.2)             -       -    179.3
  Vesting of
  restricted share      
  units                         0.3       (0.3)             -       -        -
  Adjustment to         
  finance costs                 0.1           -             -       -      0.1
  Dividends declared              -           -             -  (38.5)   (38.5)
Balance at June 30,         3,007.2
2012                                       78.2          60.6  (90.3)  3,055.7

    The condensed notes are an integral part of these interim consolidated
 financial statements and can be found in our 2013 Q2 Report available on our
                                   website.

NON-IFRS MEASURES:  Adjusted Net Income,  Adjusted EBITDA and Working  Capital 
are intended  to provide  additional  information only  and  do not  have  any 
standardized meaning prescribed  under IFRS  and should not  be considered  in 
isolation  or  as  a  substitute  for  measures  of  performance  prepared  in 
accordance with  IFRS.   These  measures are  not  necessarily  indicative  of 
operating profit or cash flow from operations as determined under IFRS.  Other
companies may calculate  these measures differently.  For a reconciliation  of 
these measures to  various IFRS measures,  please see below  or the  Company's 
current MD&A disclosure  found on the  Company's website and  on SEDAR and  on 
EDGAR.

(1)      For Q2 2013, GEOs for royalties are calculated using commodity prices
         of $1,414/oz Au (2012 - $1,611/oz Au), $1,465/oz Pt (2012 - $1,500/oz
         Pt) and $713/oz Pd (2012 - $628/oz Pd).
(2)      Adjusted Net Income is defined by the Company as net income (loss)
         excluding foreign exchange gains/losses, gains/losses on the sale of
         investments, impairment charges related to royalties, streams,
         working interests and investments, unusual non-recurring items, and
         the impact of taxes on all these items.
(3)      Adjusted EBITDA is defined by the Company as net income (loss)
         excluding income tax expense, finance income and costs, foreign
         exchange gains/losses, gains/losses on the sale of investments,
         income/losses from equity investments, depletion and depreciation and
         impairment charges related to royalties, streams, working interests
         and investments.
(4)      Working capital is defined by the Company as current assets less
         current liabilities.

Reconciliation to IFRS measures

                                Three months ended June  Six months ended June
                                                    30,                    30,
(Expressed in millions except
per share amounts)                     2013        2012       2013        2012
                                                                              
Net Income                        $    21.6   $    36.9 $     57.0 $      83.7
  Income tax expense                   12.0        14.3       25.4        26.9
  Finance costs                         0.4         0.2        1.1         0.6
  Finance income                      (0.8)       (2.5)      (1.7)       (4.7)
  Depletion and depreciation           28.2        31.0       62.6        62.7
  Foreign exchange
  (gains)/losses and other
  expenses                              9.3         2.6       14.0       (1.3)
  Impairment of investments             4.5           -        5.9           -
Adjusted EBITDA                   $    75.2   $    82.5 $    164.3 $     167.9
Weighted average shares
outstanding                           146.8       144.0      146.8       141.9
Adjusted EBITDA per share         $    0.51   $    0.57 $     1.12 $      1.18
                                                                              
Net Income                        $    21.6   $    36.9 $     57.0 $      83.7
  Foreign exchange (gain)/loss
  and other (income)/expenses,
  net of income tax                     1.9         0.4        2.1         0.8
  Mark-to-market changes on
  derivative                            4.4         1.3        7.9       (2.3)
  Impairment of investments,
  net of income tax                     4.0           -        5.2           -
  Credit facility costs written
  off, net of income tax                  -           -        0.3           -
  Withholding taxes reversal              -       (3.5)          -       (3.5)
Adjusted Net Income               $    31.9   $    35.1 $     72.5 $      78.7
Adjusted Net Income per share     $    0.22        0.24 $     0.49 $      0.55
                                                                              
                                                                 As at
                                                          June 30,    December
                                                              2013    31, 2012
  Current assets                                             879.4       879.2
  Current liabilities                                       (43.6)      (56.8)
Working capital                                              835.8       822.4

 

 

SOURCE Franco-Nevada Corporation

Contact:

For more information, please go to our website at www.franco-nevada.com or
contact: 

Stefan Axell
Manager, Investor Relations
416-306-6328
info@franco-nevada.com

Sandip Rana
Chief Financial Officer
416-306-6303
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