Tmc The Metals Company Inc. · NASDAQ:TMC
Tmc The Metals — FY2021 Earnings Presentation
37 slides from Tmc The Metals's earnings presentation, Mar 24, 2022
Slide 1: Q4 and FY 2021 Update: Key Strategic Announcements
Q4 and FY 2021 Update: Key Strategic Announcements Bringing TMC Closer to Unlocking the World’s Largest Estimated Undeveloped Source of Battery Metals. March 24, 2022
Slide 2: Forward looking statements
2 Forward looking statements. Certain statements made in this presentation are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words
Slide 3: Agenda
3 Agenda. TMC value proposition 4 Strategic update 7 Board update 11 Market update 12 Nodule resource overview 16 ESG case for nodules 20 Project development progress 24 Regulatory progress 26 Upcoming milestones for TMC 28 Project economics 29 Financial update 30
Slide 4: Our Value Proposition
4 OUR VALUE PROPOSITION Abundant, secure, low production cost and low ESG Abundant TMC is developing the world’s largest estimated source of battery metals with enough cost potential supply of metals. nickel, copper, manganese and cobalt in situ to potentially electrify 280 million EVs1 Secure Locat
Slide 5: Our Value Proposition: Intersection of Three Megatrends
5 OUR VALUE PROPOSITION TMC is positioned at $5 trillion Total addressable market for EVs the intersection of Electrification: over the next decade1 three megatrends in batteries for EVs the green transition. $2 trillion and renewables Cumulative mining investment required to limit rise in global te
Slide 6: Largest undeveloped nickel project on the planet
6 OUR VALUE PROPOSITION TMC: largest undeveloped nickel project on the planet, and the alternative to Russian- and Chinese-controlled supply. World’s largest undeveloped nickel projects World’s largest nickel operations ranked by resource size Total estimated resources (inferred, indicated & measure
Slide 7: Strategic Update: Major de-risking steps on path to production
7 STRATEGIC UPDATE Major de-risking PROJECT ZERO steps on the path Project Zero costs borne by TMC prior to production reduced from US$193M to ~US$55M1 to potential OFFSHORE ONSHORE Expected start: Q4 2024 Expected start: by Dec 31, 2024 production and Expected production: Expected production: signi
Slide 8: Pilot Collection System being tested this year
8 STRATEGIC UPDATE Pilot Collection System being tested this year before planned upgrade to Project Zero System. PILOT COLLECTOR SYSTEM TEST PROGRAM 2022 January Riser acceptance test February Thruster re-lift, dockside vessel commissioning, review of nodule offloading & handling test program Feb 7
Slide 9: Additional images of Pilot Collection System
9 STRATEGIC UPDATE Additional images of Pilot Collection System taken during testing in North Atlantic.
Slide 10: Epsilon Carbon as onshore partner
10 STRATEGIC UPDATE Epsilon Carbon as onshore partner. - Established in 2010 as world-class supplier of carbon-based products - Long-term exclusive raw materials (steel waste stream) purchase agreement with JSW Steel, India’s largest steel manufacturer - Started Epsilon Advanced Materials to develop
Slide 11: Board of Directors: independent, mission-aligned and diverse
11 BOARD UPDATE Board of Directors: independent, mission- aligned and diverse, with 50/50 gender parity. Gerard Barron Andrew Hall Kathleen McAllister Sheila Khama Chairman & CEO Lead Independent Expected Audit Chair Sustainability Chair Amelia Kinahoi Siamomua Gina Stryker Christian Madsbjerg Andre
Slide 12: Market Update: Critical metal prices have skyrocketed
12 MARKET UPDATE Since the beginning of Q4 2021, prices for critical metals including nickel have skyrocketed. 180% - Nickel price increases are still well below those of lithium carbonate which have 160% increased by ~600% since the beginning of 2021 - Benchmark Mineral Intelligence reported in Feb
Slide 13: Exponentially greater metal demand for clean tech
13 MARKET UPDATE Exponentially greater metal demand for clean tech = widening metal deficits. Power plants – kg of selected minerals* per MW Nickel class 1 supply and demand w/o greenfield, in Mt1 2.6 20000 28 2.4 9x 2.3 16000 2.2 Ni Demand 2.0 Nickel 58.693 ~40% 12000 1.8 expected 1.6 deficit 8000
Slide 14: 30+ million EVs per year could be left unbuilt
14 MARKET UPDATE By 2030, 30+ million EVs per year could be left unbuilt due to material shortages. EV sales forecast Millions of units sold per year Material-constrained sales forecast Unconstrained sales forecast 70 60 50 40 30 20 10 0 2020 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 203
Slide 15: Where will battery metals for US gigafactories come from?
15 MARKET UPDATE Where will battery metals for US gigafactories come from? Pebble, Alaska Would have been one of the world’s largest gold and copper mines. Metal requirements, reserves and production Denied permit in Nov 2020 after a decade of Metal Requirements to US US TMC NORI & negotiations. ful
Slide 16: TMC technical resource statements on NORI + TOML
16 NODULE RESOURCE OVERVIEW TMC: technical resource statements issued on NORI + TOML, with an in situ estimated resource of Ni, Cu, Co and Mn sufficient to electrify the entire US passenger car fleet1. TMC exploration contract area NORI2 TOML3 Marawa Sponsoring Republic of Kingdom of Republic of Sta
Slide 17: NORI-D project: expected production volumes
17 NODULE RESOURCE OVERVIEW NORI-D project: expected production Nickel, kt Copper, kt volumes. 150 120 130 100 110 80 100% 90 1,622Mt (wet) 60 70 50 ~125 ktpa ~93 ktpa 40 30 20 10 TOML + 0 Rest of -10 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043
Slide 18: Nodules increasingly recognized as a game-changer
18 NODULE RESOURCE OVERVIEW International Renewable US Geological Survey, Mar 2020: NOAA report to US Nodules: increasingly “Deep-ocean mining can not only Congress, Dec 1995: Energy Agency, Mar 2022: deliver the metals necessary for this “NOAA’s 1975-1980 Deep “Subsea manganese recognized as a game
Slide 19: Letters in support of seafloor nodules
19 NODULE RESOURCE OVERVIEW Letters in support of seafloor nodules recently sent by US political and military leaders to the Biden administration. Letter from Senator Lisa Murkowski (R-Alaska) Letter from 17 retired generals, admirals and to US Secretary of Energy, February 2022: officers to US Secr
Slide 20: Growing recognition of the nodule solution
20 ESG CASE FOR NODULES Growing recognition of …and growing recognition of the nodule solution… the rainforest nickel problem. Jim Conca on seafloor nodules, February 2022: Febriana Firdaus and Tom Levitt on nickel mining in Indonesia, “This is not to say the operation will be perfect, but it will b
Slide 21: Nodules expected to offer a much lower impact source for nickel
21 ESG CASE FOR NODULES Nodules expected GHG emissions Carbon sinks at risk kgCO2-eq per kg of nickel, lifecycle impacts kgCO2-eq per kg of nickel, lifecycle impacts to offer a much Laterites lower impact Matte via NPI Laterites source for nickel. Laterites HPAL Sulfides Sulfides Nodules Nodules 0 1
Slide 22: GSR pilot collector test
22 GSR pilot collector test. Video available at: https://vimeo.com/653068330/7f4d928878 Source: First test of a manganese nodule collector in around four kilometers of water: research consortium successfully completes monitoring of environmental impacts in the Pacific, BGR press release, May 12, 202
Slide 23: Seafloor after a pilot collector test
23 And here is what the seafloor looks like after a pilot collector test. Source: First test of a manganese nodule collector in around four kilometers of water: research consortium successfully completes monitoring of environmental impacts in the Pacific, BGR press release, May 12, 2021
Slide 24: Record-setting five offshore environmental campaigns
24 PROJECT DEVELOPMENT PROGRESS Record-setting five offshore environmental campaigns in ten months Image 4E Image 5B totaling 170 days at sea. Campaign 4E (17 days at sea) Campaign 5B (42 days at sea) Serviced the oceanographic moorings deployed at Pelagic biology studies of NORI-D supported by ROV,
Slide 25: Onshore, nodules turned into manganese silicate and NiCuCo matte
25 PROJECT DEVELOPMENT PROGRESS 2 Better 2 2 BetterBetter Metals Metals for for for EVs Metals EVsEVs Onshore, we have demonstrated we can turn nodules intonshorenshore nshore develop develop develop ent entent manganese silicate and NiCuCo ilot ilotilotlant lant lant rogress rogress rogress alloy &
Slide 26: Regulatory Progress: ISA exploitation regime
26 REGULATORY PROGRESS The ISA is working to finalize the exploitation regime, which “ ust e adopted 9 Jul 2023” following 2-year notice given by the Republic of Nauru on 9 July 2021.* *Article 15 of the 1994 Implementation Agreement empowers a Member State whose national contractor is 2 years away
Slide 27: Key ISA milestones and estimated timeline
27 REGULATORY PROGRESS Key ISA milestones and estimated timeline. Timeline July 2020 ISA stated goal for adoption was delayed due to COVID 9 July 2021 Government of Nauru (Sponsor of NORI) submitted a 2-year notice Dec 2021 In-person ISA meetings resume in Jamaica, after a nearly 2 year hiatus March
Slide 28: Upcoming milestones for TMC
28 UPCOMING MILESTONES FOR TMC Major milestones ahead in 2022 to keep TMC on track for estimated first production by end of 2024. Project Zero offtakes & strategic partnerships - Finalize agreement with Epsilon Carbon - Finalize agreement with Allseas - Secure offtake for NiCuCo matte and Mn silicat
Slide 29: Project Economics
29 PROJECT ECONOMICS Based on SEC-compliant NORI-D Financial Model 3 $ billions unless otherwise noted Initial Assessment, NORI-D project estimated at $6.8 Prices CRU forecast Current price Increase billion NPV (est. $22.0 billion Nickel $16,106/t $30,000/t 1 86% using current metal prices).1 Copper
Slide 30: Major project development milestones achieved in 2021
30 FINANCIAL UPDATE Major project development milestones achieved in 2021, both offshore and 2021 SUMMARY: onshore. Business Combination with SOAC Completed transaction in September, raising gross proceeds of $137.6 million in Q4 results: cash prior to transaction fees - Net loss of $19.8 million an
Slide 31: Income statement highlights: three months ended Dec 31, 2021
31 FINANCIAL UPDATE Income statement highlights: three months ended Dec 31, 2021. ($mm) Q4 2020 Q4 2021 Change Exploration expenses 13.1 12.8 (0.3) Offshore technology development 10.0 10.3 0.3 Offshore environmental program 1.1 3.8 2.7 Onshore flowsheet development 0.6 (0.2) (0.8) Project developme
Slide 32: Cash flow highlights: three months ended Dec 31, 2021
32 FINANCIAL UPDATE Cash flow highlights: three months ended Dec 31, 2021. ($mm) Q4 2020 Q4 2021 Change Cash used in operating activities 5.2 27.8 22.6 Capital expenditures - - - Settlement of deferred acquisition costs - - - Acquisition of equipment - - - Less: non-recurring items - - - Acquisition
Slide 33: Income statement highlights: year ended Dec 31, 2021
33 FINANCIAL UPDATE Income statement highlights: year ended Dec 31, 2021. ($mm) 2020 2021 Change Exploration expenses 48.9 93.0 44.1 Offshore technology development 39.6 52.0 12.4 Offshore environmental program 3.2 6.7 3.5 Onshore flowsheet development 1.1 1.8 0.7 Project development staff salaries
Slide 34: Cash flow highlights: year ended Dec 31, 2021
34 FINANCIAL UPDATE Cash flow highlights: year ended Dec 31, 2021. ($mm) 2020 2021 Change Cash used in operating activities 26.5 56.1 29.6 Capital expenditures 0.6 3.8 3.2 Settlement of deferred acquisition costs - 3.4 3.4 Acquisition of equipment - 0.4 0.4 Acquisition of exploration contract 0.6 -
Slide 35: Thank you
Investor Contact investors@metals.co Thank you. Media Contact media@metals.co Follow us
Slide 36: Appendix
Appendix
Slide 37: Appendix: non-GAAP reconciliation
37 Appendix: non-GAAP reconciliation. Non-GAAP Financial Measures – Free Cash Outflow Excluding Non-Recurring Items Free cash outflow excluding non-recurring items is a non-GAAP financial measure. Free cash outflow excluding non-recurring items is used in addition to and in conjunction with results
TMC the metals company — FY2021 Earnings Presentation on 6ix