Talga Group Ltd. · ASX:TLG
Talga — Investor Presentation (December 2020)
58 slides from Talga's investor presentation, Dec 15, 2020
Slide 1: The Sustainable Graphite Anode Solution for the Fast Growing Electric Vehicle Market
Talga Group (ASX:TLG) The Sustainable Graphite Anode Solution for the Fast Growing Electric Vehicle Market December 2020 © TALGA GROUP LTD, DECEMBER 2020 1
Slide 2: Authorisation and Disclaimer
Authorisation This Presentation has been prepared by Talga Group Ltd and is authorised for release by the Board of Directors of Talga Group Ltd. Disclaimer This Presentation has been prepared by the Company based on information from its own and third party sources and is not a disclosure document. N
Slide 3: Additional Disclaimer
Additional Disclaimer Morgan Stanley Australia Securities Limited (ABN 55 078 652 276) is acting as lead manager and underwriter of the Placement (Lead Manager). The Lead Manager has not authorised, permitted or caused the issue or lodgement, submission, dispatch or provision of this Presentation an
Slide 4: Table of Contents
Table of Contents Section 1 Overview of the Offer 5 Section 2 Talga at a Glance 10 Section 3 Investment Highlights 15 Appendix A Industry Overview 32 Appendix B Supplementary Corporate Overview 36 Appendix C JORC Graphite Reserve & Resources 40 Appendix D Peer Comparison 43 Appendix E Risk Factors 4
Slide 5: Overview of the Offer
Overview of the Offer Section 1
Slide 6: Company Overview and Project Update
Talga Group (ASX:TLG) Company Overview and Project Update • Talga Group (“Talga” or the “Company”) is developing an integrated graphite anode facility in Sweden running on 100% renewable electricity, to produce ultra-low emission coated anode for greener Li-ion batteries Developing a • Full mine-to-
Slide 7: Details of the Offer
Details of the Offer • Fully underwritten institutional placement to professional and sophisticated investors to raise A$25 million (the "Offer") • Proceeds will be used to fund the Electric Vehicle Anode Pilot Plant and for general working capital purposes Placement • The placement of 17,241,380 or
Slide 8: EVA Pilot Plant Fully Funded to De-risk the Project
EVA Pilot Plant Fully Funded to De-risk the Project A$25MM Equity Raise Provides Sufficient Funding for Talga to Commission its EVA Pilot Plant which will Scale-up Commercial Sample Delivery and De-risk the Project whilst it Seeks a Partner to Unlock the Significant Value in a Full-scale Development
Slide 9: Offer Timetable
Offer Timetable Event Date Record date for SPP 5:00pm (Perth time), Monday, 14 December 2020 Trading halt and announcement of Placement and SPP Tuesday, 15 December 2020 Placement bookbuild Tuesday, 15 December 2020 Announcement of outcome of Placement Wednesday, 16 December 2020 Trading halt lifted
Slide 10: Talga at a Glance
Talga at a Glance Section 2
Slide 11: Talga Group
Talga Group Becoming a Significant and Vertically Integrated Producer of CAPITAL STRUCTURE Lithium-ion Battery Anode Products and Technologies ASX Listing Code: TLG • Talga is developing an integrated graphite anode facility in Market Capitalisation: $468.2MM Sweden running on 100% renewable electri
Slide 12: Battery Opportunity
TESLA 18650 BATTERY CELL SHOWING ANODE & CATHODE LAYERS Battery Opportunity Build a New Anode Supply Chain Outside of Asia to Serve the European and North American Markets Production of the most environmentally sustainable and lowest-cost anode for Li-ion batteries using: natural graphite (not synth
Slide 13: Building the Solution
Building the Solution A Clean and Secure Supply of Graphite Anodes to European and North American EV Battery Manufacturers Talga is building a wholly owned, fully integrated anode Talga Integrated Project supply chain in Sweden with development of its anode refinery fed by graphite from the Vittangi
Slide 14: Europe Operations
Europe Operations European-based 100% Controlled Supply Chain • Talga Sweden Integrated graphite mine & anode production in Luleå Graphite Deposits • Talga Germany & Refinery Rudolstadt test process facility • Talga UK Pilot Process Battery anode & graphene technology development & Distribution Prod
Slide 15: Investment Highlights
Investment Highlights Section 3
Slide 16: Investment Highlights
Investment Highlights 1 Highly experienced management team with proven track record of delivering on key project milestones Early mover towards a vertically integrated model for graphite anode supply direct to battery manufacturers for the Track Record of Delivering electric vehicle supply chain
Slide 17: Strong Recent Performance
1 Strong Recent Performance Strong Recent Share Price Performance Driven by Talga Delivering on its Stated Development Plan and Growing Investor Interest Talga Share Price Performance Recent Catalysts LTM, A$/sh Volume (MM) 3.00 15.0 ✓ 25,000t trial mine permit approved 2.50 ✓ 100,000tpa mine permit
Slide 18: EV Sales Set to Grow 700% by 2030
2 EV Sales Set to Grow 700% by 2030 Strong Growth in Electric Vehicles Driving New Demand for Li-ion Batteries EV Sales Set to Grow 700% by 2030 EV Sales by Company (MMpa) 16 12 8 WE ARE AT THE POINT OF INFLECTION 4 0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 VW
Slide 19: The EV Revolution is Here Today
2 The EV Revolution is Here Today European EV Sales are Rapidly Increasing with OEMs Dramatically Expanding their Offerings Major Uplift to Recent EV Sales in Europe… …with Manufacturers Expanding Their Offerings EV Share of Sales (%) Number of EVs Launched by 2025 12% 0 20 40 60 80 Major uplift in
Slide 20: Supported by Government Incentives and Legislation
2 Supported by Government Incentives and Legislation Governments are Incentivising EV Investments and the Development of a Sustainable European Supply Chain to Support Future Bans on Fossil Fuel Powered Vehicles France to help auto sector UK to ban selling new gas European Alliance to Invest Legisla
Slide 21: Growth in Battery Material Demand
2 Growth in Battery Material Demand Graphite is the Single Largest Active Material in Li-ion Battery by Volume Graphite Makes Up 40-50% of the Active Battery Materials as the Anode Metal Intensities for Major LiB Cathode Types Tonnes of Material Required 4,000,000 Battery Capacity: 100% 2,971.9 GWh
Slide 22: With Talga Set to Supply European Battery Makers
2 With Talga Set to Supply European Battery Makers Talga Will Supply the Fastest Growing Market for Electric Vehicle Battery Makers Globally Germany, 2024 Sweden, 2021 16 GWh, later 24 GWh 32 GWh, later 40 GWh Norway, 2024 Norway, 2023 8 GWh, later 32 GWh Ramp up to 32 GWh + 2 GWh Germany, 2022 Slov
Slide 23: Vittangi's Unique Characteristics Enhance Talga's Competitive Position
3 Vittangi’s Unique Characteristics Enhance Talga’s Competitive Position The Unique Properties of the Vittangi Deposit (Grade, Flake Size and Yield) Result in Significantly Higher Graphite Anode Material Per Tonne Mined Than Competitors In Mining “Grade is King”… Yet in Graphite Flake Characteristic
Slide 24: Talga Produces the Lowest Cost and Lowest Emissions Product
3 Talga Produces the Lowest Cost and Lowest Emissions Product Talga Will Deliver a Graphite Anode Solution at the Lowest Cost and with a Fraction of the Emissions Footprint Compared to Current Suppliers Significant Cost Advantage ... …With a Fraction of the Emissions Footprint(4) Competitive Advanta
Slide 25: Attractive Performance Characteristics
3 Attractive Performance Characteristics Talga’s Talnode®-C Graphite Anode has Attractive Performance Characteristics including High Energy Density and Improved Performance in Cold Conditions Performance Measure Why Important? Talga’s Talnode®-C Production Cost • Critical for commercialization of pr
Slide 26: Talga is an Integrated Battery Materials Provider
4 Talga is an Intergrated Battery Materials Provider Integrated Supplier of Anode Products Directly to EV Battery Manufacturers Raw Materials Battery Materials Cell Manufacturer and OEMsOEM Highly Engineered Differentiated Products Graphite Miners / Processors Anode Proprietary Processes and Pro
Slide 27: Talga is Well-Progressed on Integrating into the Supply Chain
4 Talga is Well-Progressed on Integrating into the Supply Chain Full In-house Technological Capability with 100% Controlled Deposit-to-Product Supply Chain Complemented by a Growing Range of Reputable Industry Partnerships Cost and quality advantages with maximum margins as a result of full Deep ind
Slide 28: Talga Anode Technology Roadmap
4 Talga Anode Technology Roadmap Talga’s Battery Anode Range is Designed to Capitalise on Industry Growth Silicon Capacity Talnode®-Si Silicon-graphene anode Current Anode for higher energy density Solid State Talnode®-C Talnode®-E Graphite anode for large volume, low cost high-performance today Gra
Slide 29: Pilot Plant Provides a Path to Market for Talnode-C
5 Pilot Plant Provides a Path to Market for Talnode®-C Fully Funded Electric Vehicle Anode Pilot Plant to Scale Up Commercial EV Anode Sample Production • Staged development critical Battery Materials Product Development for meeting qualification requirements of leading Product Customer Commercial E
Slide 30: Strategic Partnering to Unlock Talga's Potential and De-risk Development
5 Strategic Partnering to Unlock Talga’s Potential and De-risk Development Strategic Partnering Process Expected to Unlock Significant Potential Identified in 2019 Vittangi Anode Project PFS Vittangi Anode Project PFS Key Outcomes (Does not include Niska Scoping Study released 7 December 2020) Partn
Slide 31: Significant Growth Potential
5 Significant Growth Potential Large Resource Base Supports Expansion in the Fast-Growing Graphite Battery Anode Market Niska Expansion(2) Niska Production Talnode®-C 84,700tpa Vittangi Anode Project North Production Talnode®-C 19,000tpa Production Talphene® 8,470tpa Planned Start Year 2023 LOM 14 y
Slide 32: Industry Overview
Industry Overview Appendix A
Slide 33: Graphite
Graphite 101 Natural Graphite with Potential for Significant Benefits Over Synthetic Product Why Natural Graphite? Wide Range of Graphite Uses, with Fastest Growing from the Battery Sector Synthetic Graphite Natural Graphite 5% 30% Electrodes 36% 22% Produced from needle coke via graphitization Extr
Slide 34: Talga is an Integrated Producer of Graphite Anode
Talga is an Integrated Producer of Graphite Anode Talga Will Deliver Fully Coated Active Anode Powder Ready for Battery Manufacturer Use Talga Integrated Project 1 2 3 4 Graphite Supply Anode Refinery Battery Manufacturing EV Production Simplified supply chain above – normally a wider range of entit
Slide 35: Electrification is a Global Megatrend
Electrification is a Global Megatrend Talga is Well Positioned to Capitalise on the Electrification Global Megatrend Passenger EV Sales Metal Intensities for Major LiB Cathode Types Annual (MM) The market for electric vehicles is exploding Graphite is a key contributor across battery characteristics
Slide 36: Supplementary Corporate Overview
Supplementary Corporate Overview Appendix B
Slide 37: Board of Directors
Board of Directors Substantial Commercialisation Experience Across Resource, Innovation and Development Projects Terry Stinson Mark Thompson Grant Mooney Steve Lowe Ola Rinnan Non-Executive Managing Director Non-Executive Non-Executive Non-Executive Chairman & Founder Director Director Director Over
Slide 38: Key Management Personnel
Key Management Personnel Leading In-house Expertise Across Mine and Battery Product Development Martin Phillips Dean Scarparolo Dr. Claudio Capiglia Dr. Anna Motta Peter French Chief Operating Financial Contoller Director - Battery Head of Technologies Environment & Officer & European Technologies &
Slide 39: Our Journey So Far
Our Journey So Far 2010 Talga founded by Mark Thompson and listed on ASX (code TLG) 2011 Acquires first graphite permits in Sweden 2012 Acquires Teck subsidiary to gain control of Vittangi graphite project. Drills out world’s highest grade JORC graphite resource 2014 Develops breakthrough graphene e
Slide 40: JORC Graphite Reserve & Resources
JORC Graphite Reserve & Resources Appendix C
Slide 41: JORC Graphite Reserve & Resources
JORC Graphite Reserve & Resources Ore Reserve 3, 6 Tonnes Graphite (% Cg) Nunasvaara (JORC 2012) 1,935,000 23.5 Proven 0 0 Probable 1,935,000 23.5 Mineral Resources 1, 2, 4, 5, 7, 8, 9 Tonnes Graphite (% Cg) Vittangi Nunasvaara (JORC 2012) 14,900,000 23.4 Indicated 10,400,000 25.6 Inferred 4,500,000
Slide 42: Competent Person Statements
Competent Person Statements The Niska Mineral Resource estimate was first reported in the Company’s announcement dated 15 October 2019 titled ‘Talga boosts Swedish graphite project with maiden Niska resource’. The Company confirms that it is not aware of any new information or data that materially a
Slide 43: Peer Comparison
Peer Comparison Appendix D
Slide 44: Peer Comparison Information
Peer Comparison Information Company Project MRE Grade Cut-off Grade Information Source ASX Announcement, 17 September 2020 Talga Vittangi Project 24.0% 10.0% https://www.talgagroup.com/irm/PDF/d9fea321-6ec8-4cce-a6a2- 423ed526e3c3/TalgaBoostsGraphiteResources Corporate Presentation, 16 October 2020
Slide 45: Peer Comparison Information
Peer Comparison Information Company Project MRE Grade Cut-off Grade Information Source Market Announcement, Molo NI 43-101, 31 May 2019 Next Source Molo 6.1% 2.0 - 4.0% http://www.nextsourcematerials.com/static/media/uploads/2019_molo_feasi bility_study_report_final.pdf Company Website 7 December 20
Slide 46: Risk Factors
Risk Factors Appendix E
Slide 47: Key Risks (1 / 6)
Key Risks (1 / 6) This section identifies the areas that the directors regard as the major risks associated with an investment in the Company. Investors should be aware that an investment in the Company involves many risks, which may be different to the risks associated with an investment in other c
Slide 48: Key Risks (2 / 6)
Key Risks (2 / 6) Licences, Permits, Processing and Approvals Risks The Company's current and future operations are subject to receiving and maintaining licences, permits and approvals from appropriate governmental authorities. In particular, the Company will require processing, exploitation and env
Slide 49: Key Risks (3 / 6)
Key Risks (3 / 6) Reliance on Key Management The responsibility of overseeing the day-to-day operations and the strategic management of the Company depends substantially on its senior management and its key personnel. Whilst the key management team has been well established with on-going stability,
Slide 50: Key Risks (4 / 6)
Key Risks (4 / 6) Pandemic Risk Supply chain disruptions resulting from the transmission of pandemics such as COVID-19 in the community and measures implemented by governments around the world to limit the transmission of the virus may adversely impact the Company’s operations, financial position, p
Slide 51: Key Risks (5 / 6)
Key Risks (5 / 6) Third Party Risk The Company will rely significantly on strategic relationships with other entities and also on a good relationship with regulatory and government departments and other interest holders. This may include entering into joint venture arrangements for the development o
Slide 52: Key Risks (6 / 6)
Key Risks (6 / 6) Government and Legal Risk Changes in government, monetary policies, taxation and other laws can have a significant impact on the Company's assets, operations and ultimately the financial performance of the Company and its Securities. Such changes are likely to be beyond the control
Slide 53: Foreign Selling Restrictions
Foreign Selling Restrictions Appendix F
Slide 54: International Offer Restrictions (1/2)
International Offer Restrictions (1/2) This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may not be offered or sold,
Slide 55: International Offer Restrictions (2/2)
International Offer Restrictions (2/2) Singapore This document and any other materials relating to the New Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this document and any other document or materials
Slide 56: Key Terms of the Underwriting Agreement
Key Terms of the Underwriting Agreement Appendix G
Slide 57: Key Terms of the Underwriting Agreement (1/2)
Key Terms of the Underwriting Agreement (1/2) 1.1 Conditions Morgan Stanley Australia Securities Limited (ABN 55 078 652 276) (Lead Manager) is acting as lead manager, bookrunner and underwriter of the Placement. Talga has entered into an underwriting agreement with the Lead Manager in respect of th
Slide 58: Key Terms of the Underwriting Agreement (2/2)
Key Terms of the Underwriting Agreement (2/2) 1.3 Termination events qualified by materiality The Lead Manager may terminate its obligations under the Underwriting Agreement if any of the following events occur, subject to the Lead Manager reasonably believing that the event (a) will, or is likely t