De.mem Ltd. · ASX:DEM
De.mem — Investor Presentation (September 2019)
45 slides from De.mem's investor presentation, Sep 23, 2019
Slide 1: De.mem Limited (ASX:DEM) Investor Presentation
For personal use only De.mem Limited (ASX:DEM) Investor Presentation 23 September 2019
Slide 2: Contents
CONTENTS APPENDICES 3 LARGE ADDRESSABLE MARKET 22 A – ANNOUNCED CUSTOMER CONTRACTS For personal use only 4 BUSINESS OVERVIEW 26 B – SAMPLE PROJECT REFERENCES 32 C – PRODUCT & TECHNOLOGY OVERVIEW 5 KEY INVESTMENT CONSIDERATIONS 40 D – PROCESS AND SYSTEM DESIGN 6 FINANCIAL OVERVIEW 7 COPORATE SNAPSHOT
Slide 3: Large Addressable Market Opportunity: Decentralised Water Treatment
LARGE ADDRESSABLE MARKET OPPORTUNITY: DECENTRALISED WATER TREATMENT 3 For personal use only • The global market for packaged / decentralised water treatment systems was valued at USD 12 billion in 2015 and is projected to reach USD 21.8 billion by 2021 - a compounded growth of 10.4% per annum* • Dec
Slide 4: Business Overview
BUSINESS OVERVIEW 4 KEY INVESTMENT PROPOSITION For personal use only De.mem is on a clear track to become the leading player in de-centralized water treatment in Australia and the Asia-Pacific region, based on a suite of proven, disruptive, easy-to-scale membrane technologies targeting a huge addres
Slide 5: Key Investment Considerations
KEY INVESTMENT CONSIDERATIONS 5 Uniquely positioned to become the leading player in decentralized water treatment across APAC, providing a range of proven, world-class, highly scalable and potentially disruptive technologies to a large addressable market For personal use only Proprietary technology
Slide 6: Financial Overview
FINANCIAL OVERVIEW 6 DEM is growing its recurring revenue base and has a visible path to sustainable operating cash positive For personal use only REVENUE GROWTH A$M (DEC YR END) 2016 2017 2018 • High revenue growth from $0.3m in 2016 to Revenues 0.3 2.9 10.5 $2.9m in 2017 and $10.5m 2018 • 2019 on
Slide 7: Corporate Snapshot
CORPORATE SNAPSHOT 7 ASX code DEM For personal use only NA Singapore Early-Stage Venture Fund 30.1% Ordinary shares 140.0m New Asia Investments Pte Ltd 9.4% MAJOR SHAREHOLDERS Market capitalisation $23.7m Cash on hand (30.06.19) $3.5m Perennial Value Microcap Opportunities Fund 7.7% MARKET DATA List
Slide 8: DEM: Attractive Relative Valuation
DEM: ATTRACTIVE RELATIVE VALUATION 8 DEM trades at an 87% discount to the average Market Capitalisation/Revenue multiple of its listed comparables For personal use only Last Twelve Market Market Company Months Capitalisation Capitalisation / Technology Market Focus Revenue (30 August 2019) Revenue P
Slide 9: Strong Customer Value Proposition
STRONG CUSTOMER VALUE PROPOSITION 9 De.mem as a Total Water Management Solutions Provider: For personal use only A “One-stop-shop” for the customer • Deep technical know-how based on long term experience and strong team • Access to proprietary products/components, deployed as part of the systems to
Slide 10: Revenue Model Focus on Growing Annuity Revenues
REVENUE MODEL FOCUS ON GROWING ANNUITY REVENUES 10 Annuity revenues are approx. 35% of total revenues and growing For personal use only Equipment sales Build-Own-Operate Operations Consumables Sales or Build-Own-Transfer and Maintenance • Sale of water and • De.mem owns the • De.mem operates • Inclu
Slide 11: Growing Recurring Revenues
GROWING RECURRING REVENUES 11 In CY 2018, approx. 40% of group revenues or A$4 million was derived from long-term contracts or For personal use only recurring revenue streams • Intensified promotion of Build-Own-Operate (BOO)/ Build-Own-Transfer (BOT) offer, targeting BOO/BOT, O&M signing of additio
Slide 12: Blue Chip Customer Base
BLUE CHIP CUSTOMER BASE 12 Customers include global mining companies, large EPC contractors, For personal use only municipalities, water utilities and multinational corporations Mining Municipal / Infrastructure Food & Beverage Other Industrial • Potable/sewage treatment • Potable • Key 2019 • Indus
Slide 13: Multiple Growth Drivers
MULTIPLE GROWTH DRIVERS 13 DEM intends to expand into new geographies and new market segments, For personal use only supported by the further expansion of the IP and product portfolio IMMEDIATE GROWTH PLAN (12 MONTHS) MEDIUM TERM GROWTH PLAN (1-3 YEARS) • Expansion into Food & Beverage segment • Exp
Slide 14: Regional and International Expansion
REGIONAL AND INTERNATIONAL EXPANSION 14 Currently, ~90% revenues are from Australia with further opportunity to grow Australian revenues and For personal use only offshore at the same time Australia & Pacific Singapore / SE Asia • Australia as a strong home market • Huge need for decentralised water
Slide 15: Strategic Value-Adding Acquisitions
STRATEGIC VALUE-ADDING ACQUISITIONS 15 Strategic bolt-on acquisitions can expand customer base, customer geographies and product range; For personal use only expand DEM into new customer industries and provide cross-sell synergies The most recent strategic acquisition is Pumptech, in July 2019 CONSI
Slide 16: Strong Intellectual Property Portfolio
STRONG INTELLECTUAL PROPERTY PORTFOLIO 16 De.mem proprietary product portfolio includes breakthrough membrane innovations For personal use only COMPLETED (2018 and 2019) PLANNED (2019 FF) • Nanofiltration membrane • Membrane Bioreactor (MBR) – Superior filtration performance due to minimum – Treatme
Slide 17: Partnering with Leading Player in Water Treatment Research
PARTNERING WITH LEADING PLAYER IN WATER TREATMENT RESEARCH 17 Competitive advantage of collaboration with Nanyang Technological University (NTU), Singapore – For personal use only one of the world’s leading institutions for water technology research & development • NTU ranked no. 2 in membrane resea
Slide 18: New Product Launch: Domestic Point of Use Water Filter System
NEW PRODUCT LAUNCH: DOMESTIC “POINT OF USE” WATER FILTER SYSTEM 18 For personal use only Recently entered domestic water solutions market through low-cost distribution partnership model • De.mem launched a new product line targeting domestic “point of use” water filtration, as announced on 18 July 2
Slide 19: Board of Directors
BOARD OF DIRECTORS 19 For personal use only Board has a strong industrial background Cosimo Trimigliozzi Bernd Dautel Stuart Carmichael Michael Edwards Chairman Non-Executive Director Non-Executive Director Non-Executive Director • COO of Wild Flavors • Director New Asia • Partner & Director • Non-E
Slide 20: Senior Management
SENIOR MANAGEMENT 20 For personal use only Highly experienced and committed management team Andreas Kroell Matt Howland David Chua Allan Afonso CEO and Director Group Sales Manager Director, Membrane Senior Operations Manufacturing Manager • Director New Asia • 20 years water • 10+ years experience
Slide 21: Outlook
OUTLOOK 21 Ongoing revenue growth For personal use only • On track to exceed 2018 revenues, with year-to-date revenues in CY 2019 in line with FY2018 • Clear strategy and focus on growing recurring revenues - driven by BOO, O&M, increased consumables and products sales • Visible path to sustainable
Slide 22: Appendix A: Announced Customer Contracts
For personal use only 22 APPENDIX A ANNOUNCED CUSTOMER CONTRACTS
Slide 23: DEM: Contract Wins - 2019
DEM: CONTRACT WINS - 2019 23 For personal use only 2019 total initial value of new contract wins = >A$4.37m Company Date Description Initial Value Announced (A$m) Acciona 10-Sep-19 Delivery of a containerized, membrane-based water NA treatment plant. 1. Western Australian Government 28-Aug-19 1. Wat
Slide 24: DEM: Contract Wins - 2018
DEM: CONTRACT WINS - 2018 24 2018 total initial value of new contract wins = A$2.96m For personal use only Company Date Announced Description Initial Value Municipal and Resource 10-Dec-18 Delivery of a chlorination system and sale of $0.35 Sector in Queensland membrane based water system JRK Group
Slide 25: DEM: Contract Wins - 2017
DEM: CONTRACT WINS - 2017 25 2017 total initial value of new contract wins = A$2.6m For personal use only Initial Date Company Announced Description Value (A$M) - Delivery of an integrated portable water treatment system to JRK Group - JRK Group 22-Dec-17 - Delivery of equipment, particularly storag
Slide 26: Appendix B: Sample Project References
For personal use only 26 APPENDIX B SAMPLE PROJECT REFERENCES
Slide 27: Selected Project References
SELECTED PROJECT REFERENCES 27 For personal use only Industrial Waste Water Municipal / Potable Water Mining / Potable Water Mining / Potable Water & Sewage Food Industry Waste Nghe An Water Coppabella Water Sewage and Water Water Treatment Plant Treatment Plant Treatment Plants • Location: Singapor
Slide 28: Selected Project References (Cont.)
SELECTED PROJECT REFERENCES (CONT.) 28 For personal use only Municipal / Sewage Treatment Municipal / Potable Water Industrial Waste Water Infrastructure / Waste Water Municipal Sewage Reservoir Oil & Gas Industry Vehicle Wash Bay Treatment Plant Re-Chlorination Waste Water Waste Water • Location: Q
Slide 29: Project Examples – Potable Water Treatment
PROJECT EXAMPLES – POTABLE WATER TREATMENT 29 For personal use only Hidden Valley Mine Calliope Village Coominya Municipality Supply of 350 m3 per day potable Supply of 250 m3 per day Supply of 500 m3 per day water to 1,400 person mining potable water to 1,100 person potable water to the 1,500
Slide 30: Project Examples – Sewage Treatment
PROJECT EXAMPLES – SEWAGE TREATMENT 30 For personal use only Wafi Mine Construction Camp BP Bulwer Island - Australia Wafi Golpu Mine JV Sewage Treatment Plant for the Wafi Sewage Treatment Plant for the Jet Sewage Treatment Plant for the Mine accommodation village with 250 Terminal project admin
Slide 31: Project Examples – Industrial
PROJECT EXAMPLES – INDUSTRIAL 31 For personal use only F&B Industry Waste Water Vehicle Wash Bay Waste Water Oil & Gas Industry Waste Water • Waste water treatment plant for • Vehicle washing bay waste water • Waste water treatment for Oil & F&B industry factory in Singapore treatment plant for mili
Slide 32: Appendix C: Product and Technology Overview
For personal use only 32 APPENDIX C PRODUCT AND TECHNOLOGY OVERVIEW
Slide 33: Hollow Fibre Membranes: Working Principle
HOLLOW FIBRE MEMBRANES: WORKING PRINCIPLE 33 HF Membrane Bundles Membrane Modules For personal use only De.mem offers a range of proprietary hollow fibre (HF) membrane technologies • The membranes/membrane modules serve as the key component (the actual filter) in De.mem’s water treatment systems • M
Slide 34: Filtration Spectrum
FILTRATION SPECTRUM 34 For personal use only
Slide 35: Membrane Manufacturing in Singapore
MEMBRANE MANUFACTURING IN SINGAPORE 35 De.mem is fully capable of producing a range of hollow fibre membrane technologies at its For personal use only manufacturing facility in Singapore • With the proceeds from the IPO in April 2017, De.mem started its own membrane manufacturing facility in Singapo
Slide 36: De.mem's Microfiltration Product (New Launch)
DE.MEM’s MICROFILTRATION PRODUCT (NEW LAUNCH) 36 For personal use only NEW Feed PRODUCT Hollow fibres • De.mem offers a newly developed hollow fibre Microfiltration membrane for cross-flow filtration • The membrane comes with a pore size of approx. 500k • De.mem can potentially vary membrane pore si
Slide 37: De.mem's Ultrafiltration and Nanofiltration Membranes
DE.MEM’s ULTRAFILTRATION AND NANOFILTRATION MEMBRANES 37 • De.mem’s Ultrafiltration membrane technology is For personal use only an established separation process using a pore size around 100 nm (approx. 100k Da MWCO) • The membrane can be deployed in a wide range of applications – from waste water
Slide 38: De.mem's Forward Osmosis-Dewatering Membrane
DE.MEM’s FORWARD OSMOSIS-DEWATERING MEMBRANE 38 • Forward Osmosis (FO) is a membrane Working Principle of Forward Osmosis Membrane For personal use only separation technology based on osmotic pressure differences; without any external mechanical Membrane Membrane pressure being applied • Salt concen
Slide 39: Food & Beverage Market Opportunity
FOOD & BEVERAGE MARKET OPPORTUNITY 39 Promoting FO membrane into lucrative food & beverage segment through Aromatec For personal use only • As announced on 8 May 2018, De.mem took strategic stake (32%) in Aromatec Pte Ltd, a Singaporean company targeting the food & beverage industry as a joint ventu
Slide 40: Appendix D: Process & System Design
For personal use only 40 APPENDIX D PROCESS & SYSTEM DESIGN
Slide 41: Process and System Design – Potable Water
PROCESS AND SYSTEM DESIGN – POTABLE WATER 41 For personal use only
Slide 42: Process and System Design – Sewerage Treatment
PROCESS AND SYSTEM DESIGN – SEWERAGE TREATMENT 42 For personal use only
Slide 43: Process and System Design – Food and Beverage
PROCESS AND SYSTEM DESIGN – FOOD AND BEVERAGE 43 For personal use only
Slide 44: Legal Disclaimer
LEGAL DISCLAIMER 44 This presentation has been prepared by De.mem Limited and its related entities (the “Company”). It does not purport to contain all the information that a prospective investor may require in connection with any potential investment in the Company. You should not treat the contents
Slide 45: De.mem Limited Investor Enquiries
For personal use only DE.MEM LIMITED (ASX:DEM) Andreas Kroell Chief Executive Officer De.mem Limited investor@demem.com.sg INVESTOR ENQUIRIES George Gabriel, CFA Managing Director BLETCHLEY Park Capital investors@bletchleyparkcapital.com.au (03) 8686 9144