Fusion Fuel Green Plc · NASDAQ:HTOO
Fusion Fuel Green — SPAC Merger (August 2020)
48 slides from Fusion Fuel Green's SPAC merger presentation, Aug 6, 2020
Slide 1: Fusion Fuel Business Combination Overview
Fusion Fuel Business Combination Overview Investor Presentation August 2020
Slide 2: Disclosure
Fusion Fuel & HL Acquisitions: Business Combination Overview Disclosure 2 THIS PRESENTATION HAS BEEN PREPARED FOR USE BY HL ACQUISITIONS CORP. (“HL”) AND FUSION WELCOME – FUEL, S.A. (“FUSION FUEL”) IN C ONNECTION WITH THEIR PROPOSED BUSINESS COMBINATION. SUCH PRESENTATION MAY BE PRESENTED TO CERTAIN
Slide 3: Executive Summary & Deal Overview
Executive Summary & Deal Overview
Slide 4: Business Combination: HL Acquisitions & Fusion Fuel
Fusion Fuel & HL Acquisitions: Business Combination Overview Business Combination: HL Acquisitions & Fusion Fuel 4 HL Acquisitions Corp (HCCH) • Nasdaq - listed SPAC raised $55mm in June 2018 • $54mm currently held in trust as of June 2, 2020 • Experienced Board & Management team o Four decades of e
Slide 5: HL Acquisitions & Fusion Fuel: Transaction Overview
Fusion Fuel & HL Acquisitions: Business Combination Overview 5 HL Acquisitions & Fusion Fuel: Transaction Overview (in millions) 1 Illustrative Pro - Forma Ownership² Pro - Forma Valuation² 1. Assuming no shareholders exercise redemption rights 2. Based on primary shares outstanding; excludes 9,875,
Slide 6: Recent Highlights
Fusion Fuel & HL Acquisitions: Business Combination Overview 6 Recent Highlights Recent Developments: Global Hydrogen Recent Developments: Fusion Fuel • Designation From Portugal’s National Innovation Agency o The Portuguese National Innovation Agency recognized Fusion Fuel as a Company of Competenc
Slide 7: Executive Summary: HL Acquisitions & Fusion Fuel
Fusion Fuel & HL Acquisitions: Business Combination Overview Executive Summary: HL Acquisitions & Fusion Fuel 7 The merger’s earnout incentive reinforces alignment and helps manage risk by tethering commercial progress to deal economics, while also supporting long - term growth. Fusion Fuel’s propri
Slide 8: Market Overview
Market Overview
Slide 9: A Massive Addressable Market
Fusion Fuel & HL Acquisitions: Business Combination Overview A Massive Addressable Market 9 1. The Future of Hydrogen, IEA, June 2019 – 70mt per annum. 2. Hydrogen Roadmap Europe: A Sustainable Pathway for the European Energy Transition; FCH JU, 2019 EU Hydrogen Consumption Expected To Grow by 2 - 7
Slide 10: Why Green Hydrogen?
Fusion Fuel & HL Acquisitions: Business Combination Overview 10 Why Green Hydrogen? Hydrogen Supply Blue vs. Green Decarbonization Holy Grail Emerging Policy Focus • Recent innovations allow for hydrogen to be produced as Blue or Green Hydrogen • Blue Hydrogen is obtained through carbon capture & st
Slide 11: Government Support For Green Hydrogen
Fusion Fuel & HL Acquisitions: Business Combination Overview Government Support For Green Hydrogen 11 Adding A 10% Green Hydrogen Mix To Europe’s Imported Natural Gas Represents An €11B/year opportunity 7 Natural Gas – Imports Overview ( bcm )¹ 1. 2018 Natural Gas Imports bcm , 2018; McKinsey & Comp
Slide 12: Immediate Opportunities & Long-Term Growth
Fusion Fuel & HL Acquisitions: Business Combination Overview Immediate Opportunities & Long - Term Growth 12 € 18bn Secondary Addressable Market € 250bn Global Addressable Market Fusion Fuel’s Local Market Should Drive Substantial Growth, With Scalable Opportunities Across Southern Europe & MENA € 9
Slide 13: Significant Local Content Advantages
Fusion Fuel & HL Acquisitions: Business Combination Overview Significant Local Content Advantages 13 Fusion Fuel Has Already Been Named In Portugal’s National Hydrogen Strategy As A Strategic Technology Provider Portugal’s Hydrogen Strategy Green hydrogen is a key pillar of Portugal’s decarbonizatio
Slide 14: Fusion Fuel: Company Details
Fusions Fuel: Company Details
Slide 15: Fusion Fuel's Business & Strategy
Fusion Fuel & HL Acquisitions: Business Combination Overview Fusion Fuel’s Business & Strategy Fusion Fuel Has Redesigned The Initial Stages Of The Hydrogen Value Chain To Efficiently Utilize CPV Waste Heat… Source: Fusion Fuel Management estimates 15 CPV Solar Tracker MagP Product (exclusive to Fus
Slide 16: Fusion Fuel Strategy & Business Lines
Fusion Fuel & HL Acquisitions: Business Combination Overview 16 Fusion Fuel Strategy & Business Lines Technology Provider of Green Hydrogen Technology • Sell and Install Fusion Fuel hydrogen generators to customers seeking to operate and own Green Hydrogen facilities • Develop and sell Green Hydroge
Slide 17: Fusion Group History
Fusion Fuel & HL Acquisitions: Business Combination Overview 17 Fusion Group History Concentrated Photovoltaic Fusion Group, and its predecessor companies specialized in the creation of CPV solar solutions • Over 20 solar CPV plants installed throughout Europe and MENA . • Over time became the leadi
Slide 18: Executives & Directors
Fusion Fuel & HL Acquisitions: Business Combination Overview Fusion Fuel Executives & Directors 18 Joao Teixeira Wahnon – Head of Business Development at Fusion Fuel 16 years experience in renewable energy project development, has overseen negotiations of more than € 500 m in renewable projects ; ba
Slide 19: Head Start: Exclusive Production Capacity Agreement
Fusion Fuel & HL Acquisitions: Business Combination Overview Head Start: Exclusive Production Capacity Agreement 19 Fusion Fuel’s Electrolyzer Attaches To CPV Modules Already Produced By MagP , Limiting Early - Stage Production Risks MagP Inovação Installations, Portugal Immediate Access to Producti
Slide 20: Business Model
Business Model
Slide 21: Hydrogen Production Costs
Fusion Fuel & HL Acquisitions: Business Combination Overview 0 2 4 6 8 0 2 4 6 8 Natural Gas Coal Natural Gas W/ CCUS Renewables $/kg $/kg Target Production Cost¹ (Brown Hydrogen) (Blue Hydrogen) (Green Hydrogen) (Green Hydrogen) (Brown Hydrogen) Hydrogen Production Costs Fusion Fuel Enables Ultra -
Slide 22: Technology and Project Development
Fusion Fuel & HL Acquisitions: Business Combination Overview 22 Technology Selling Green Hydrogen Generators Will sell hydrogen generators to Refineries, Ammonia Producers and Natural Gas Distributors, and others Fusion Fuel’s Technology business also intends to supply its product development – usin
Slide 23: Initial Project Overviews
Fusion Fuel & HL Acquisitions: Business Combination Overview Initial Project Overviews Evora Project A Green Hydrogen Utility Scale Demonstrator , using Fusion Fuel’s technology to produce Green Hydrogen . It has two phases and a total of 55 Hydrogen Generators : 1. 40 Hydrogen Generators to produce
Slide 24: Project Timelines
Fusion Fuel & HL Acquisitions: Business Combination Overview Fusion Fuel Project Timelines 1. Sines timeline is illustrative. Firm schedules are pending continued development w/ potential stakeholders. Completion and cl osi ng of both projects is still pending Source: Fusion Fuel Management estimate
Slide 25: Growth Driver in Portugal: The Sines Project
Fusion Fuel & HL Acquisitions: Business Combination Overview Growth Driver in Portugal: The Sines Project 25 2021 2022 2023 2024 2025 Cumulative Project Name Sines 1 Sines 2 Sines 3 Sines 4 Sines 5 Sines 1 - 5 Concession Period 25 years 25 years 25 years 25 years 25 years 25 years Project Capacity 1
Slide 26: Geographic Concentration & Strategy
Fusion Fuel & HL Acquisitions: Business Combination Overview 26 Geographic Concentration & Strategy Fusion Fuel’s technology works at its optimal level in regions with high solar irradiation Over time, Fusion Fuel’s intention is to build out local business development platforms in regions that enabl
Slide 27: Financial Overview
Financial Overview
Slide 28: Fusion Fuel: Baseline Model Projections
Fusion Fuel & HL Acquisitions: Business Combination Overview 28 Fusion Fuel: Baseline Model Projections 1 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 0 50 100 150 200 250 300 2020E 2021E 2022E 2023E 2024E Margin % MM € Sales EBITDA Net Income Gross Margin EBITDA Margin As Fusion Fuel Ramps Production, It
Slide 29: Business Plan
Fusion Fuel & HL Acquisitions: Business Combination Overview 29 Business Plan¹ • Technology revenue stemming from related projects could start as soon as 2020 , with the potential commencement of the Evora project. • Project Development revenue is projected begin in 2021, with related revenue stream
Slide 30: Valuation & Comps
Valuation & Comps
Slide 31: Public Valuation Comps
Fusion Fuel & HL Acquisitions: Business Combination Overview 3.1x 0.3x 5.8x 7.0x 2.3x 7.7x 3.4x 21.7x 25.0x 45.1x 0x 5x 10x 0x 5x 10x EV/Sales EV/Sales 31 Public Valuation Comps 1. Assuming ~$97MM EV and net sales of ~$30MM in 2021 and ~$300MM in 2024 Source: FactSet, Fusion Fuel Management estimate
Slide 32: Fusion Fuel: Pro Forma Deal-Based Valuation Comps
Fusion Fuel & HL Acquisitions: Business Combination Overview 3.1x 1.0x 0.5x 0.3x 0x 2x 4x 6x 8x 10x 12x 2021 2022 2023 2024 EV/Sales Fusion Fuel 11.1x 2.4x 1.0x 2021 2022 2023 2024 Nikola & VectoIQ 4.1x 1.6x 8.6x 2.6x ITM & Linde² NEL Hydrogen & Diagenic ASA³ CMI & Hydrogenics⁴ NEL & Proton OnSite⁵
Slide 33: Valuation Sensitivity Analysis
Fusion Fuel & HL Acquisitions: Business Combination Overview 33 Valuation Sensitivity Analysis 1,2 Implied Equity Value Per Share ($) Multiple 7.0x 8.0x 9.0x 10.0x 11.0x 12% $40 $46 $52 $58 $64 11% $42 $48 $54 $60 $66 10% $43 $50 $56 $62 $68 9% $45 $52 $58 $64 $71 8% $47 $53 $60 $67 $74 Discount Rat
Slide 34: Transaction Details
Transaction Details
Slide 35: Sources & Uses Overview
Fusion Fuel & HL Acquisitions: Business Combination Overview 35 Sources & Uses Overview (in millions) 1 Specific Capital Uses 1. Assuming no shareholders exercise redemption rights 2. Assuming the combined value of one Class B ordinary share and one warrant to purchase Class A ordinary shares to be
Slide 36: Transaction Terms
Fusion Fuel & HL Acquisitions: Business Combination Overview 36 • Implied Equity Value of $ 96 . 7 million¹ • HL shareholders will retain 77 % of the outstanding shares of the successor company after closing the transaction² • Current Fusion Fuel shareholders will roll 100 % of their holdings • Fusi
Slide 37: The Deal's Earnout Incentive Ensures Alignment
Fusion Fuel & HL Acquisitions: Business Combination Overview 37 • A significant component of Fusion Fuel’s consideration is a contingent payment that incentivizes management to deliver on robust business development targets and ensures alignment between HL shareholders and the owners of Fusion Fuel
Slide 38: Takeaways
Takeaways
Slide 39: Executive Summary & Financial Projections
Fusion Fuel & HL Acquisitions: Business Combination Overview Executive Summary & Financial Projections (MM €)¹ Vision Unique IP & Cost Advantage Diverse Revenue Model Extensive Managerial Expertise Fusion Fuel’s electrolyzer produces Green Hydrogen significantly cheaper than the 3 . 5 – 7 . 5 €/kg f
Slide 40: Investment Highlights
Fusion Fuel & HL Acquisitions: Business Combination Overview Investment Highlights 40 The Deal’s Earnout Incentive Ensures Alignment Solid Management Track Record , With Existing Expertise & Production Footprint A Growth Driver In Their Own Backyard: The Sines Project Proprietary Technology Enabling
Slide 41: HL Acquisitions Overview
HL Acquisitions Overview
Slide 42: HL Acquisitions Key Leadership Team
Fusion Fuel & HL Acquisitions: Business Combination Overview HL Acquisitions Key Leadership Team 42 Rune Magnus Lundetrae – Independent Director Mr . Lundetrae served as Deputy Chief Executive Officer and Chief Financial Officer of Borr Drilling Ltd . from its inception in December 2016 through Dece
Slide 43: HL Acquisitions Leadership & Stakeholders
Fusion Fuel & HL Acquisitions: Business Combination Overview HL Acquisitions Leadership & Stakeholders 43 Jon Guss – Independent Director Mr . Guss joined Bogen Communications International in November 1997 as Chief Executive Officer . From 1994 to 2005 , he served on the Board of Directors of Allia
Slide 44: Appendix
Appendix
Slide 45: Fusion Fuel IP
Fusion Fuel & HL Acquisitions: Business Combination Overview Patent 1 – Already filled • Overall concept and approach to hydrogen production through CPV Patent 2, 3 & 4 – In preparation • These patents all relate to the proprietary developed electrolyzer which converts water (H 2 O) into H 2 and O 2
Slide 46: Efficiency Comparison: DC-PEHG vs. Centralized Electrolyzer
Fusion Fuel & HL Acquisitions: Business Combination Overview 46 Efficiency Comparison: DC - PEHG vs. Centralized Electrolyzer Cell voltage volts/cell 1.65 1.75 Voltage Efficiency % LHV 74.5% 70.3% Dryer Loss % of gross H 2 3% 3% Total Stack Energy Usage per mass H 2NET kWh elec /kg Net H2 46.42 49.2
Slide 47: Capex / kW Comparison: DC-PEHG vs. Centralized Electrolyzer
Fusion Fuel & HL Acquisitions: Business Combination Overview 47 Capex / kW Comparison: DC - PEHG vs. Centralized Electrolyzer 116 € 385 € 41% NA 94 € 10% NA 47 € 5% 56 € 56 € 6% NA 47 € 5% NA 188 € 20% NA 28 € 3% NA 47 € 5% NA 9 € 1% NA 38 € 4% 56 € 555 € 59% Uninstalled cost on centralized electrol
Slide 48: Cost Comparison: Fusion Fuel vs. Comparable PV-based Hydrogen Production
Fusion Fuel & HL Acquisitions: Business Combination Overview 48 Cost Comparison: Fusion Fuel vs. Comparable PV - based Hydrogen Production • The production of 500 tons of green hydrogen per annum with the traditional solar PV + centralized electrolyzer model would require a capex investment of €24.7