Deterra Royalties Limited — Investor Presentation 2021

Oct 13, 2021

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Australian Securities Exchange Notice

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13 October 2021

ASX: DRR

Corporate Presentation

Deterra Royalties Limited (ASX: DRR) ( Deterra or Company ) is pleased to attach a copy of the presentation provided to be used in meetings between the Managing Director and CEO with shareholders and analysts.

This document was approved and authorised for release by Deterra’s Managing Director.

Ian Gregory Company Secretary

Investor enquiries:

Matthew Schembri Investor Relations Manager Mobile: + 61 (0) 427 821 380 Email: investor.relations@deterraroyalties.com

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Deterra Resources Limited • ACN 641 743 348 • Level 5 216 St Georges Terrace Perth WA 6000 T +61 (0)8 6277 8880 • www.deterraroyalties.com

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The resources investment that pays

Corporate Presentation October 2021

Im ortant notices and disclaimer p

This presentation has been prepared by Deterra Royalties Limited (“Deterra”, “the Company”). By accessing this presentation you acknowledge that you have read and understood the following statement.

The material in this presentation is general background information about Deterra and its activities current as at the date of the presentation on 13 October 2021. The information in this presentation is given in summary form and does not purport to be complete. Information in this presentation is provided to assist sophisticated investors with their own analysis of the Company but should not be relied upon as a predictor of future performance. The current outlook parameters supersede all previous key physical and financial parameters. The information in this presentation is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investors. Investors should consider these factors and consult with their financial, legal or other professional adviser.

This presentation should be read in conjunction with Deterra's other periodic and continuous disclosure announcements which are available at www.asx.com.au.

Reporting Period

Financial Year 2021, FY21 and Period ended 30 June 2021 all refer to the period 15 June 2020 to 30 June 2021.

Reserves, resources and other technical information

Except where otherwise stated, the information in this presentation relating to the mining assets to which Deterra's royalty interests are referrable is based solely on information publicly disclosed by the owners or operators of these mining assets and information and data available in the public domain as at the date of this presentation, and none of this information has been independently verified by Deterra. Accordingly, Deterra does not make any representation or warranty, express or implied, as to the accuracy or completeness of such information. Specifically, Deterra has limited, if any, access to the mining assets in respect of which royalties are derived by the Deterra. Deterra generally relies on publicly available information regarding the mining assets and generally have no ability to independently verify such information.

Forward-looking Statements

This presentation contains certain statements which constitute “forward-looking statements”. Often, but not always, forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “expect”, “plan”, “believes”, “estimate”, “anticipate”, “outlook” and “guidance”, or similar expressions, and may include, without limitation, statements regarding plans; strategies and objectives of management; anticipated performance; estimates of future expenditure; expected costs; estimates of future royalty income, product supply, demand and consumption; statements regarding future product prices; and statements regarding the expectation of future Mineral Resources and Ore Reserves.

Where Deterra expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and on a reasonable basis. No representation or warranty, express or implied, is made by Deterra that the matters stated in this presentation will in fact be achieved or prove to be correct.

Forward-looking statements are only predictions and are subject to known and unknown risks, uncertainties, assumption and other important factors that could cause the actual results, performances or achievements of Deterra or the underlying royalty assets to differ materially from future results, performances or achievements expressed, projected or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. Such risks and factors include, but are not limited to: the risks and uncertainties associated with the ongoing impacts of COVID-19, the Australian and global economic environment and capital market conditions; changes in exchange rate assumptions; changes in product pricing assumptions; major changes in mine plans and/or resources; changes in equipment life or capability; emergence of previously underestimated technical challenges; increased costs and demand for production inputs; and environmental or social factors which may affect a licence to operate, including political risk.

To the extent permitted by law, Deterra, its officers, employees and advisors expressly disclaim any responsibility for the accuracy or completeness of the material contained in this presentation and exclude all liability whatsoever (including in negligence) for any loss or damage which may be suffered by a person as a consequence of any information in this presentation or any error or omission therefrom. Deterra does not undertake to release publicly any revisions to any forward-looking statement to reflect events or circumstances after the date of this presentation, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.

No independent third party has reviewed the reasonableness of the forward-looking statements or any underlying assumptions.

Past performance

Investors should note that past performance metrics and figures in this presentation are given for illustrative purposes only and cannot be relied upon as an indicator of (and provide no guidance as to) future Deterra performance, including future share price performance. Any such historical information is not represented as being, and is not, indicative of Deterra's views on its future financial condition and/or performance.

Non-IFRS Financial Information

This document may contain non-IFRS financial measures including EBITDA, Underlying EBITDA, EBIT, free cash flow, and net debt amongst others. Deterra management considers these to be key financial performance indicators of the business and they are defined in the FY21 Annual Report (18 August 2021). Non-IFRS measures have not been subject to audit or review.

All figures are expressed in Australian dollars unless stated otherwise.

In accordance with ASX Listing Rule 15.5, Deterra confirms that this presentation has been authorised for release to ASX by Deterra's Managing Director.

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Cor orate overview p

Capital Structure[1]

Capital Structure1
Share price	$3.77
Shares on issue	528.5m
Market capitalisation	$2.0bn
Cash (30 June 2021)	$24.2m
FY21 Dividend3	17.83¢
Royalty agreements	6

Share price performance[1]

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Volume (M) Close (A$/sh)
6.0 15.0
5.0
4.0 10.0
3.0
2.0 5.0
1.0
0.0 0.0
Volume (M)
Share Price (A$/sh)
Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 Oct-21
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Board and Management Team

	Managing Director, CEO	Julian Andrews
	Independent Chair	Jenny Seabrook
	Non-Executive Director	Graeme Devlin
	Non-Executive Director	Joanne Warner
	Non-Executive Director2	Adele Stratton
	Chief Financial Officer	Brendan Ryan

Register composition

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Iluka
Institutional
Retail
Other
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• (1) As of 13 Oct 2021

• (2) Iluka Resources nominee

• 3 (3) 17.83¢/sh dividend from 15 Jun 20 to 30 Jun 21, see slide 6 for details

What we offer investors

Quality

MAC royalty covers a world class iron ore hub, operated by BHP the world’s largest mining company[1]

Margins

96% EBITDA Margin[2]

Dividends

100% of NPAT, Fully Franked[3]

Growth

South Flank expected to grow MAC volumes by 2.4x[4] Patient and disciplined approach to value accretive M&A

ESG

Targeting net zero operational GHG footprint in FY22 ESG integral to our investment process

• (1) BHP is the world’s largest listed mining company by market capitalization as of 8 Oct 2021

• (2) FY21 EBITDA margin calculated for Post-demerger period

• (3) Deterra’s approach to dividends and dividend policy will be determined by the Deterra Board at its discretion and may change over time

• (4) BHP media article – 20 May 2021

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A better wa to invest in resources y

Reduce operational exposure, capture upside.

“Top Line” Commodity Price Cashflows Leverage

Royalty revenue derived from asset’s top line revenue.

Direct exposure to underlying commodity price.

Project Optionality

Asset expansions and extensions drive value of royalty investments.

The nature of our business model means our investors are exposed to lower capital and operating risk than typical mining investments but retain exposure to the upside through expansions and extensions at no cost.

No Capital Cost Limited Operating Cost Inflation Obligations Cost Exposure Resistance Royalty owner is free carried No direct exposure to project High margins, and protection through future project capital operating costs. against cost inflation. requirements.

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Deliverin stron financial outcomes g g

Statutory accounts[1] Attributable to[2] :

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Total Revenue Revenue Revenue
$145.2M $29.3M $115.9M
Underlying EBITDA [3] Underlying EBITDA Underlying EBITDA
$135.5M $24.4M $111.1M
NPAT NPAT NPAT
$94.3M $20.4M $73.9M
Dividends per share [4]
DPS [4] DPS
17.83¢
3.86¢ 13.97¢
(100% of NPAT)
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• (1) Refers to results for period 15 June 2020 to 30 June 2021.

• (2) See notes on slide 7.

• (3) See notes on slide 2 – Non-IFRS Measures.

• (4) Pre-demerger dividends per share shown based on the share count for the period immediately following demerger and is included in total dividends on this same basis.

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Royalty and streaming company landscape

Deterra holds a leading position in the non-gold royalty streaming sub-sector

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Listed Royalty Universe [1] Existing Royalties [2] Non-Gold Listed Royalty Universe [1]
Total US$65bn market cap 30% of Existing Royalties Deterra has a dominant position in
with only 8% Non-Gold are Non-Gold the non-gold royalty universe
8% Non-Gold
11% Other Gold 29% Non-Gold Deterra Royalties Altius Minerals
11% Royal Gold Anglo Pacific
29% Wheaton 30% Mesabi Trust
Precious Metals
Other Non
71% Gold
Gold
41% Franco-Nevada
Labrador Iron Ore Royalty Corp
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(1) S&P Capital IQ. Average market capitalisation for the peer group during September 2021. Includes; TSX:FNV, NYSE:WPM, NasdaqGS:RGLD, TSX:OR, TSX:TFPM, TSX:SSL, TSX:MMX, TSX:NSR, TSXV:MTA, TSXV:EMX, TSXV:RZZ, TSXV:VOX, TSXV:ELE, AIM:ALS, TSXV:FISH, TSXV:OGN, TSX:LIF, ASX:DRR, TSX:ALS, LSE:APF, NYSE:MSB, TSXV:URC, AIM:TRR

(2) Number of royalties from Deterra analysis of S&P Capital IQ.

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Our core asset – the Minin Area C Ro alt … g y y

Low-risk exposure to a large, low-cost iron ore mining complex that is set to grow its volumes by approximately 2.4 times

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Low-cost operations with long life Significant near-term growth Resource upside in a low-risk
through South Flank expansion jurisdiction
Iron ore total cash cost curve
(2025F) [1]
Mining Area C production Mining Area C
Mining
(Financial years, Mwmt) [2] (MAC) royalty area [3] Area C
1st 2nd 3rd 4th
quartile quartile quartile quartile
2.4x
145.0
55.1 57.3 60.6 55.8 60.6 61.6
Other MAC South Flank
2016 2017 2018 2019 2020 2021
Future
Capacity
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• (1) Source: Wood Mackenzie. Total cash costs are defined as direct cash cost associated with mining, processing and transport of marketable products, including G&A costs directly related to mine production, royalties, levies and other indirect taxes.

• (2) BHP reported MAC production volumes on a wet basis. Source: BHP Operational Review for the year ended 30 June 2021 (20 July 2021) and similar prior Operational Reviews, available at www.asx.com.au; BHP delivers first production from South Flank (20 May 2021), available at www.BHP.com.

• (3) Source: BHP, overlay of illustrative MAC royalty area. Location and mineralisation outline are for illustrative purposes only.

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… is levera ed to South Flank rowth g g

Deterra’sMAC Royalty revenue is determined by BHP’s realised iron ore prices, sales volumes and foreign exchange rates

Revenue royalty payment of 1.232% of realised AUD FOB revenue from sale of MAC product:

• 2021 average realised pricing: A$200/dmt

• June 2021 Qtr pricing: A$254/dmt

• 2021 MAC sales: 55.9 million dry metric tonnes

• Forecast capacity on completion of South Flank expansion: 145 million wet metric tonnes[2]

• The sensitivity table adjacent illustrates a range of potential MAC royalty receipts under various iron ore and production assumptions.

• assumes constant AUD:USD exchange rate of 0.75

Capacity payment of A$1 million per 1 million dry metric tonne (dmt) increase in annual production at MAC[3]

MAC Royalty annual receipts – Illustrative production and price sensitivity[1] (AUD million)

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Realised Iron Ore Price:
A$/dmt (FOB)
( US$/dmt (FOB) )
80 107 133 160 187 213 240 267
(60) (80) (100) (120) (140) (160) (180) (200)
60 59 79 99 118 138 158 177 197
80 79 105 131 158 184 210 237 263
100 99 131 164 197 230 263 296 329
120 118 158 197 237 276 315 355 394
140 138 184 230 276 322 368 414 460
(Mdmt)
MAC Sales
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• (1) Excludes one-off capacity payments.

• (2) MAC sales volumes are reported on a dry basis and will vary from BHP reported production due to product moisture factors and the timing of sales and inventory movements in any reporting period. Source BHP delivers first production from South Flank (20 May 2021), available at www.BHP.com.

• (3) The threshold production for future capacity payments is now 59 Mdmt.

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Targeted growth strategy focused on value-accretive investment

Deterra’s screening process and investment criteria prioritise opportunities where it has a competitive advantage

Primary royalties

• Creating new royalties for: • Project capital

• Balance sheet repair

• • M&A finance support

Secondary royalties

Acquire existing royalties to:

• Improve liquidity

• Daylight value

• Diversify risk

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How we prioritise opportunities
Investment criteria
Size Commodity Geography Stage
ESG Value
Broad mandate Developed mining
driven by ability to (“Sweet spot” of add value ••• BulksBase metalsBattery metals jurisdictions, incl: ••• AustraliaN. AmericaS. America •• ProductionNear production ESG risk and opportunity return in excess of Ability to generate asset-specific
A$100 – A$300M) • Europe cost of capital
Other opportunities considered on merit on a case by case basis
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Growth strategy focused on increasing earnings and diversification through value-accretive investments over time.

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Benefits of ro alt financin to a minin artner y y g g p

Royalty financing brings many advantages versus traditional forms of financing

Longer terms and no fixed payments Not dilutive to existing shareholders Simpler to execute No brokerage fees Vs Vs Limited covenant package No market discount Debt Equity Values underlying project, not current Shared production and operational risks share price Better positioned to value expansions Project specific, corporate unencumbered and extensions

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Ca ital structure and fundin for rowth p g g

The high-quality MAC cash flows and conservative capital management provides Deterra with strong capacity to fund growth

Net cash position at 30 June 2021 Working capital facility of $40M

Retain strong balance sheet

Maintain conservative balance Substantial sheet in line with royalty peers funding Funding decisions will depend on capacity the specifics of each investment

Focus on 100% NPAT dividend payout ratio shareholder Funding model may evolve to returns match nature of investment

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New
Other New
Cornerstone MAC Royalty Royalties Royalty Investments
Revenue
5 x small Potential
Royalty revenue = 1.232% of A$
royalty new
revenue from MAC Royalty Area [1] assets asset
Deterra Royalties
Access to
Capital
Scalable Structure: Low overheads and debt
Shareholder Returns
Shareholder distribution target 100% NPAT
payout ratio, franked to the maximum extent
possible
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(1) Deterra Royalties also received capacity payments under the MAC Royalty Agreement.

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Committed to sustainable shareholder returns

Our sustainability roadmap outlines our commitment to transparent reporting of our ESG performance and objectives

Current Next Steps

• Applied to become signatory to the UN Global Compact

• • Established a Human Rights Policy • Published our first Corporate Governance Statement • Completed a voluntary Tax Transparency Disclosure • Developed ESG due diligence assessment criteria

• Targeting net-zero operational GHG footprint in FY22

• Develop an annual Modern Slavery Statement

• Assess materiality and enhance our performance disclosures

• Establish community engagement initiatives

• • Enhance the robustness of our ESG due diligence process

Future State

Guided by global frameworks to;

• Enhance our disclosures

• Inform our investment decisions

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A better wa to invest in the resources industr y y

Summary

Our Business Model

1 MAC royalty is one of the world’s best royalty assets.

2 Superior EBITDA margin of 96% in FY21[1] .

3

100% NPAT dividend payout ratio, fully franked[2] .

South Flank to grow MAC volumes by 2.4x[3] and a 4 growth mandate to provide patient and disciplined value accretive M&A.

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• (1) FY21 EBITDA margin calculated for Post-demerger period

• (2) Deterra’s approach to dividends and dividend policy will be determined by the Deterra Board at its discretion and may change over time

• (3) BHP media article – 20 May 2021

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For more information:

Investor and Media enquiries

Matthew Schembri Investor Relations Manager Mobile: + 61 (0) 427 821 380 Email: matt.schembri@deterraroyalties.com

Brendan Ryan Chief Financial Officer

Email: investor.relations@deterraroyalties.com

Deterra Royalties Limited ACN 641 743 348

Level 5, 216 St Georges Terrace Perth WA 6000 Telephone: +61 (0)8 6277 8880

www.deterraroyalties.com

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