Altech Batteries Limited · ASX:ATC
Altech Batteries — Altech Chemicals — Internationale Delmetall-Rohstoffmesse (November 2017)
36 slides from Altech Batteries's conference presentation, Nov 6, 2017
Slide 1: Altech Chemicals Limited – Internationale Delmetall-Rohstoffmesse
Altech Chemicals Limited ASX: ATC FSE:A3Y For personal use only Internationale Delmetall-Rohstoffmesse Munich, Germany Iggy Tan Managing Director
Slide 2: World leading producer of high purity alumina (HPA)
For personal use only World leading producer of high purity alumina (HPA) Our Vision 4,500 tonnes pa
Slide 3: Sapphire & Ruby
For personal use only • Sapphire & Ruby • Natural form of high purity alumina (HPA) Al2O3 • Formed by mother nature like diamonds • Colour from impurities Sapphire • Nearly as hard as diamond (Mohs 9) Gemstone
Slide 4: What is HPA?
For personal use only • Purified alumina (Al2O3) • 99.99% (4N) purity or greater • Smelter Grade Alumina (SGA) ~ 99.5% (5,000ppm impurities, mainly sodium) • Bayer Process uses sodium hydroxide What is HPA? (NaOH) • Sodium impurity is problem for electronics industry
Slide 5: Our Target Business
For personal use only Smelter Grade High Purity High Purity High Purity High price Alumina SGA 99.5% Alumina HPA 99.9% (3N) Alumina HPA 99.99% (4N) Alumina HPA 99.999% (5N) for purity US$400 per t US$6,000 per t US$27,000 per t US$50,000 per t Our Target Business
Slide 6: High Purity Alumina
High Purity Alumina For personal use only Synthetic Sapphire Sapphire Furnace (2,000 oC) Sapphire Crystal Boule High Purity Alumina Lithium-Ion Batteries Battery Separators / Cathode / Anode Lithium-Ion Batteries
Slide 7: Lithium-ion Battery Separator
Lithium-ion Battery Separator For personal use only Anode Sheet Separator Cathode Sheet HPA is used in lithium-ion battery separator coatings
Slide 8: Sapphire Applications
Sapphire Applications For personal use only LEDs Sapphire Wafer / Substrate Light Emitting Diodes LED Glass Sapphire Cores Sapphire Glass Smartphone and Lenses
Slide 9: LEDs – lighting of the future
LEDs – lighting of the future For personal use only Conventional LEDs New LED products
Slide 10: Sapphire Glass
Sapphire Glass For personal use only HTC U Ultra (128Gb) o February 2017 o Sapphire crystal display Smartphone sapphire screen iPhone o Sapphire crystal lens o Finger print recognition
Slide 11: Sapphire Glass Scratch Test
Sapphire Glass Scratch Test For personal use only
Slide 12: Global HPA demand 25,315tpa in 2016
For personal use only • Global HPA demand 25,315tpa in 2016 1 • Expected to increase to 86,831tpa by 2024 1 • Growing at a CAGR of 17%1 Demand • Driven by LED growth & lithium-ion batteries for HPA • Entering a fast growing market • Altech production 4,500 tpa 1 Source: Persistence Market Research “
Slide 13: Global High Purity Alumina Forecast 2015-2024
For personal use only Global High Purity Alumina Forecast 2015 -2024 Source: Persistence Market Research 86,831 “High Purity Alumina Market – Global Industry Analysis and Forecast 2016-2024” 75,637 Demand HPA Comsumtion tpa 65,036 55,350 39,786 46,748 for HPA 34,328 29,669 25,315 21,309 2015 2016 20
Slide 14: HPA Battery Separator Forecast
HPA Battery Separator Forecast For personal use only GLOBAL SEPARATOR HIGH PURITY ALUMINA DEMAND 99.99% HPA Used in Lithium Battery Separators 15,102 Source: Altech Chemicals & Deutsche Bank Markets Research Industry Lithium 101 - 9 May 2016 13,848 HPA Comsumtion in Li-Ion Battery Industry, tpa 11,5
Slide 15: 70% of HPA demand Asia Pacific (APEC)
For personal use only • 70% of HPA demand Asia Pacific (APEC) • World’s manufacturing hub • Malaysian HPA plant location well-positioned HPA • Transport, customer service, technical credibility Geographic Americas 14% Demand Europe, Middle East, Africa 16% Asia Pacific 70%
Slide 16: Six largest HPA producers
For personal use only • Six largest HPA producers: China (3), Japan (1), South Africa (1) France (1) Sumitomo Chemicals (Japan) 3,020 Huantou, 800 Others (15), 3,570 Sasol (South Africa) 1,800 Current HPA Dailian Rall, 600 Producers Nippon Light Metal, 1,100 Baikowski (France) Hebei Pengda (China) 1
Slide 17: Altech's Differentiation
Altech’s Differentiation For personal use only Current HPA Producers Alumina Alumina Aluminium Refinery Smelter Dissolution Bauxite Smelter Grade Alumina Aluminium Metal 99.99% (4N) 99.5% HPA ~US$3,000 per tonne ALTECH HPA PLANT One Single Process Step Kaolin 99.99% (4N) (aluminous clay) HPA
Slide 18: Very low iron (Fe) due to weathering
For personal use only • Very low iron (Fe) due to weathering • 12.7Mt JORC Mineral Resources^ (250 yrs) • Measured Resources 1.5Mt @ 30% Al2O3 • Indicated Resources 3.3Mt @ 30% Al2O3 • Inferred Resources 7.9Mt @ 29.1% Al2O3 • Deposit in Western Australia Low-impurity Bauxite Canadian Kaolin Feedstoc
Slide 19: Altech owns 100% of kaolin deposit in WA
For personal use only • Altech owns 100% of kaolin deposit in WA • Low environmental impact • 130kms from Fremantle Port Meckering • Mining lease (M70/1334) granted Kaolin Deposit • Ore Reserve 1.2Mt @ 30% Al2O3 for 30 year (stage 1) mine-life
Slide 20: Lower quartile costs
For personal use only • Lower quartile costs • Kaolin feedstock shipped from WA • Chemical-zoned industrial park (Tanjung Langsat) HPA Site • Sea container ports Location • Plant site secured Johor • Malaysian government incentives
Slide 21: Established HCl leach process
For personal use only • Established HCl leach process • Developed in 1980’s by alumina industry • Couldn’t compete with Bayer SGA costs • But great at producing HPA (no sodium-ions) • However little demand for HPA in 1980s Altech HPA • Demand for HPA is here today Process
Slide 22: New HPA Demand + Established Process + Unique Deposit
For personal use only New HPA Demand + Established Process + Unique Deposit + Experienced People Shareholder Value Experienced People High Purity Business New Demand Deposit Strategy (Electronics) Established HPA HCl Process “the last piece of the puzzle is in place”
Slide 23: Altech HPA Process
Altech HPA Process For personal use only ROM Campaign Mining Sea Container To Fremantle MECKERING Shipping Sea Container Meta Kaolin Flash JOHOR Dryer Hydrochloric Acid Filter Cooler Screening Calciner Milling HCl Gas Polishing Screening Filter Filter 700 C Drum Scrubber > 0.3mm Quartz Oversize Acid
Slide 24: Going Commercial
For personal use only • Work started early 2011 • Extensive lab and pilot plant test work • Successfully produced 4N 99.99% HPA • Off-the-shelf plant and equipment Going • Completed successful BFS Commercial • Final Investment Decision approved
Slide 25: Altech's HPA Plant – Malaysia
Altech’s HPA Plant – Malaysia For personal use only Crystallisation Plant Residue Plant Acid Leach Calcination Final Product Kaolin Calcination Kaolin Plant Sea container unloading Security
Slide 26: Final Investment Decision Study
For personal use only • Pre-tax NPV7.5 US$ 505 million • Internal Rate of Return (IRR) 22% • Payback (full rate) 3.9 years Final • EBITDA US$ 76 million p.a. Investment • Capital cost US$ 298 million Decision Study • Total target debt of US$ 185 million FIDS • Production Costs - US$ 9.90/kg • LT Sal
Slide 27: High Case Economics
For personal use only • Current price in Japan - US$ 40.0/kg • Pre-tax NPV7.5 US$ 1.1 billion • Internal Rate of Return (IRR) 33% High Case • Payback (full rate) 2.2 years • EBITDA US$ 133 million p.a. Economics • Production Costs - US$ 10.50/kg • Sale Price - Gross Margin – 74% 27
Slide 28: Bottom quartile for operating costs
For personal use only • Competitors US$14 - 17,000/t (Breakaway Research) 1. We own our feedstock 2. Main reactant HCl re-used 3. Plant in low cost country (Malaysia) Bottom Quartile Altech for Op Costs Source: Persistence Market Research “High Purity Alumina Market – Global Industry Analysis and Fo
Slide 29: Off-take sales agreement with Mitsubishi
For personal use only • Off-take sales agreement with Mitsubishi • First 10 years of HPA operations • Secures sales for 100% of 4,000tpa HPA plant production Mitsubishi • Exclusive global distributor signs • Experienced with HPA off-take • Strategic priority: lithium-ion batteries
Slide 30: Final Stage of Debt Funding Approval
For personal use only • Target total debt of US$ 185 million • US$ 165 million export credit finance • Debt funding with KfW IPEX-Bank Final Stage of • 50% of plant – German suppliers Debt Funding • Low interest, long tenure Approval • ECA approval date 14 Dec 2017
Slide 31: SMS group German EPC contractor
For personal use only • SMS group German EPC contractor • Lump sum turn key contract • Completion and cost risk • Process & throughput guarantee Lump Sum • Equity investment contribution Turn Key • Detailed design at advanced stage Contract • Completing EPC cost estimate 31
Slide 32: Target Final ECA Approval
For personal use only • All consultants report completed • Expert opinion report 9 Nov 2017 Target • IMA ECA approval meeting 14 Dec 2017 Final ECA Approval 32
Slide 33: Market Capitalisation - end of month
For personal use only Altech Chemicals Limited Market Capitalisation - end of month ($m) $50.0 48 45 $45.0 40 39 $40.0 36 36 35 36 35 35 33 32 Altech $35.0 31 31 31 32 31 $30.0 $25.0 $20.0 $15.0 12 16 15 14 16 15 17 14 15 17 growth performance 8 8 8 7 7 $10.0 7 7 $5.0 $- Aug-15 Nov-15 Aug-16 Nov-16
Slide 34: Altech Year Share Price Trend
For personal use only Altech 3 Year Share Price Trend • 300% growth in share price in 3 years • Still early in valuation stage
Slide 35: Thank you
For personal use only Right Place Right Time Right Feedstock Right Technology Thank you
Slide 36: Forward-looking Statements
For personal use only Forward-looking Statements The Company reports that the ECA application process is set for end 2017 and there is no certainty that the export credit and debt finance will be approved. The Company makes no representation or warranties whatsoever as to the outcome of the ECA appr
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