Australian Strategic Materials Ltd · ASX:ASM
Australian Strategic Materials — Investor Presentation (April 2024)
41 slides from Australian Strategic Materials's investor presentation, Apr 17, 2024
Slide 1: Offer Presentation
Rare Earths. Critical Minerals. Offer Presentation High-tech Metals. Australian Strategic Materials Limited ACN 168 368 401 17 April 2024 Not for release to US wire services or distribution in the United States
Slide 2: Disclaimer
Disclaimer Investor Presentation This investor presentation (Presentation) is dated 17 April 2024 and has been prepared by Australian Strategic Materials Limited ABN 90 168 368 401 (ASM or the Company) in connection with ASM’s proposed placement of new fully paid ordinary shares in the Company (New
Slide 3: Disclaimer
Disclaimer Effect of rounding A number of figures, amounts, percentages, estimates, calculations of value and fractions in this Presentation are subject to the effect of rounding. The actual calculation of these figures may differ from the figures set out in this Presentation. Forward Looking Statem
Slide 4: Disclaimer
Disclaimer Previously reported information Information prepared and disclosed under the JORC Code has not materially changed since last reported in Company’s ASX announcements available to view on the Company’s website. The Company is not aware of any new information or data that materially affects
Slide 5: Offer summary
Offer summary • Placement to raise A$15m through the issue of ~12.9m New Shares and free Attaching Options1 • Entitlement Offer2 to eligible shareholders, under which eligible shareholders will be able to apply for New Shares and Attaching Options at the same price as the Placement to raise up to ap
Slide 6: Building a global rare earths and critical minerals business
Building a global rare earths and critical minerals business to provide the high-tech metals needed to solve the challenges of today and the future. Confidential | © ASM 2024 | 6
Slide 7: From mine to metals
From mine to metals Confidential | © ASM 2024 | 7
Slide 8: Corporate profile
Corporate profile Board of Directors Ordinary Shares 166.8M Share Price A$1.440 Market Capitalisation A$240.2M 52 week low/high A$0.93 - 2.25 Ian Gandel Rowena Smith Gavin Smith Nic Earner Kerry Gleeson Non-Executive Chair Managing Director Non-Executive Director Non-Executive Director Non-Executive
Slide 9: Latest news
Latest news US$600M (A$923M1) Letter of Interest received from US EXIM for Dubbo Project execution & construction phase2 Contract awarded to US-owned Bechtel for Front-End Engineering Design (FEED) services3 Application to cover >80% of FEED contract submitted to US EXIM’s Engineering Multiplier Pro
Slide 10: Dubbo Project
Dubbo Project A unique ore body with the potential to meet global demand. Nd Pr Tb Dy Zr Hf Nb Neodymium Praseodymium Terbium Dysprosium Zirconium Hafnium Niobium Confidential | © ASM 2024 | 10
Slide 11: A secure, sustainable source
A secure, sustainable source • 20-year life of mine based on reserves1 Long life of mine • Further 50 years of resource1 • Low strip ratio (<1x) • 25kms from Dubbo, NSW – close to established infrastructure Tier 1 jurisdiction • Strong government support – A$17M in grants received recently • Within
Slide 12: Delivery of strong financials
Delivery of strong financials Revenue1 AUD 23.5% 840m Pre-tax IRR > 60% margin2 AUD 2,361 million 44% Forecast pre-tax NPV Rare Earths Zirconium Hafnium Opex AUD 425 million Niobium AUD 287m Annual free cash flow3 33% 4% AUD 1,678 million 34% 19% Capital cost estimate including contingency 1 Refer:
Slide 13: US partnership enabling a pathway to funding
US partnership enabling a pathway to funding Bechtel contract to support ASM with engineering at the Dubbo Project1 • US-based Bechtel – existing deep experience of the Dubbo Project • Opportunity to fund >80% of Bechtel contract through Engineering Multiplier Program (EMP) • US EXIM Letter of Inter
Slide 14: Strong US government support
Strong US government support Letter of Interest (LOI) from US EXIM bank for up to US$600M (A$923M1)2 Current conditional debt funding support for • US$600M US EXIM LOI for Dubbo Project construction of the Dubbo Project3 execution phase Export Credit Agency Amount • US government support a catalyst
Slide 15: Global support for an alternative supply chain
Global support for an alternative supply chain Australia • Critical Minerals Facility • National Reconstruction Fund • International Partnerships in Critical Minerals Program1 Export Credit Agencies • Australia, US, Korea, Canada, EU2 United States • Inflation Reduction Act • Defense Production Act
Slide 16: Pathway forward for the Dubbo Project
Pathway forward for the Dubbo Project Focus for 2024 Targeted project timeline • Progress non-process infrastructure (NPI) study work • Finalise US EXIM EMP funding and H2 2024 H1 2026 2028 commence Bechtel FEED contract Finalise EMP Complete FEED Complete • Secure further funding via: funding and c
Slide 17: Korean Metals Plant
Korean Metals Plant Providing an alternative integrated supply chain for high-tech metals. Confidential | © ASM 2024 | 17
Slide 18: In production & ramping up
In production & ramping up Growing customer base NdPr metal sales to Korea NdFeB alloy sales to USA Securing raw materials Production capacity Advanced discussions with potential Currently 600tpa installed suppliers in the EU and US Phase 2 expansion up to 3,600tpa1 ISO 45001, 9001 & 14001 Metallisa
Slide 19: Progressing new customer opportunities
Progressing new customer opportunities • NdFeB strip alloy technical validation advancing, serving Korean, EU, and US markets • 465kg commercial sample for April 2024 delivery to EU customer, aiding final technical validation • Additional commercial sample sales to Korean and EU customers expected i
Slide 20: Business Development Update
Business Development Update Confidential | © ASM 2024 | 20
Slide 21: Strategic partnerships for sustainable growth
Strategic partnerships for sustainable growth • Identifying global REE opportunities for upstream supply chain diversity and strength, in support of mine to metals strategy • Discussions in Vietnam (government and private level) to explore REE mining, refining and supply opportunities • Exclusive op
Slide 22: Offer Overview
Offer Overview Confidential | © ASM 2024 | 22
Slide 23: Offer Overview
Offer Overview Placement to raise A$15m and Entitlement Offer to raise up to approximately A$5.2m • Placement to raise A$15m through the issue of ~12.9m New Shares Offer structure • Entitlement Offer to eligible shareholders, under which eligible shareholders will be able to apply for New Shares and
Slide 24: Sources and Uses of Funds
Sources and Uses of Funds Following the Offer, ASM expects to be capitalised to support government funding and near-term strategic opportunities Funding rationale Sources of funds1 • Government funding sought from Australian grants and US Placement A$15M EXIM backed EMP loan to fund pre-execution ac
Slide 25: Indicative Timetable
Indicative Timetable Placement Event Date Placement bookbuild Monday, 15 April 2024 Announcement of completion and outcome of Placement and trading halt lifted Wednesday, 17 April 2024 Settlement of New Shares issued under the Placement via DVP Tuesday, 23 April 2024 Allotment and trading of New Sha
Slide 26: Proforma liquidity position post Placement
Proforma liquidity position post Placement 1 The Placement will strengthen ASM’s balance sheet, providing increased financial flexibility and working capital Item Units Amount The Placement is expected to provide support to access government funding and near- Cash (at 31 March 2024)2 A$M $38.5 term
Slide 27: Summary
Summary Confidential | © ASM 2024 | 27
Slide 28: ASM – mine to metals
ASM – mine to metals Building an alternative global supply chain Producing high-tech metals & alloys Strong government strategic support Dubbo Project construction ready1 A$1.12 billion conditional debt funding2 1 Subject to obtaining required funding. There is no certainty that funding will be rece
Slide 29: Annexures and Appendices
Annexures and Appendices Confidential | © ASM 2024 | 29
Slide 30: Appendix A: Option Terms
Appendix A: Option Terms The following terms apply to the Placement Attaching Options and the Entitlement Offer Attaching Options TERM SUMMARY Entitlement Each Option entitles the holder to subscribe for one New Share on exercise of the Option. Exercise Price $1.74 per Option. Expiry Date 5.00 pm (S
Slide 31: Appendix B: Key Risks - Overview
Appendix B: Key Risks - Overview Overview This section provides an overview of some of the risks relating to participation in the Offer and key risks associated with any investment in ASM which may affect the future operating and financial performance of ASM and the value of ASM Shares. The risks se
Slide 32: Appendix B: Key Risks - Overview
Appendix B: Key Risks - Overview Attaching Options • The market price of the Company’s ordinary shares is subject to varied and unpredictable influences on the market for equities in general. Market conditions (see the risk titled “Market conditions”) and lack of liquidity (see the risk titled “Liqu
Slide 33: Appendix C: Key Risks - Company Specific Risks
Appendix C: Key Risks – Company Specific Risks Supply Chain Risk ASM’s ability to successfully develop and commercialise the Dubbo Project, and commercialise the KMP, is subject to supply chain risk. Dubbo Project ASM will depend on suppliers of materials, services, equipment and infrastructure to d
Slide 34: Appendix C: Key Risks - Company Specific Risks
Appendix C: Key Risks – Company Specific Risks Metallurgical process risk Rare earth and critical mineral recoveries are dependent on the metallurgical process that is required to liberate economic minerals and produce a saleable product and by nature contain elements of significant risk such as: •
Slide 35: ASM's funding matrix
Appendix C: Key Risks – Company Specific Risks ASM’s funding matrix The purpose of the Offer is, in part, the provision of engineering services, and other contractual obligations under a FEED services contract between Bechtel and ASM to provide services to support the development of a bankable feasi
Slide 36: Appendix C: Key Risks - Company Specific Risks
Appendix C: Key Risks – Company Specific Risks Regulatory approvals ASM requires government regulatory approvals for its operations. As at the date of this Presentation, ASM has received all major state and federal approvals and licences required for execution of the Dubbo Project. However, the impa
Slide 37: Appendix C: Key Risks - Company Specific Risks
Appendix C: Key Risks – Company Specific Risks Native Title, Aboriginal Heritage and Land Claims Risks It is possible that, in relation to tenements in which ASM has an interest or may acquire such an interest, there may be areas over which legitimate native title rights exist or which are subject t
Slide 38: Appendix D: Key Risks - General Risks
Appendix D: Key Risks – General Risks Occupational health and safety Force majeure Exploration, construction and production activities may expose ASM’s staff and contractors to potentially dangerous working ASM's current and future projects, financial performance and licence to operate may be advers
Slide 39: Appendix E: International Offer Restrictions
Appendix E: International Offer Restrictions This document does not constitute an offer of New Shares and Attaching Options 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 and Attaching Options ma
Slide 40: Appendix E: International Offer Restrictions
Appendix E: International Offer Restrictions New Zealand Placement This document has not been registered, filed with or approved by any New Zealand regulatory authority under the Financial Markets Conduct Act 2013 (the “FMC Act”). The New Shares and Attaching Options are not being offered or sold in
Slide 41: Thank you
Rare Earths. Critical Minerals. Thank you High-tech Metals. asm-au.com.au Confidential | © ASM 2024 | 41
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