Slide 1: Improving your health and the planet's health
Improving your health and the planet’s health April 2020 TSX: NPK OTCQB: AMHPF
Slide 2: Disclaimer
Disclaimer If you are risk averse don’t buy our stock. Don’t rely on anything on this presentation. This presentation contains certain forward-looking information, which includes but is not limited to, statements with respect to Verde Agritech Plc’s (the Company’s) strategy, the commercial productio
Slide 3: Agenda
Agenda • 2019 Highlights • Financial Results for Fourth Quarter ("Q4") and Full Year End 2019 ("FY") * • Outlook for 2020 • Corporate Presentation How the COVID-19 crisis is impacting Verde Brazil is feeding the world in a sustainable manner Brazil’s dependency on imported potash Verde’s solution •
Slide 4: Cerrado Verde Project: Summary
Cerrado Verde Project: Summary • Mining, Production and Sale of a Potassium Silicate Mineral • K Forte® and Super Greensand® used as fertilizer • Brazilian farming accounts for 10% of global agricultural production • Clear advantages for Brazilian farmers to use Verde’s products • Commercial product
Slide 5: 2019 Achievements
2019 Achievements • Environmental License Issued for 249,800 tonnes per year ("tpy") • Mining Permits issued for 432,800 tpy • Strengthening the team, 3 senior executives and 10 new employees • Plant 1: expansion completed, 500,000 tpy production capacity • New Mine Pit start up • 400+ customers and
Slide 6: 2019 Q4 and FY Consolidated Results
2019 Q4 and FY Consolidated Results
Slide 7: Verde Agritech PLC Q4 Results
Verde Agritech PLC Q4 Results All amounts in CAD $’000 Q4 2019 Q4 2018 • Revenue increased 115% YoY Tonnes sold ‘000 32 20 • Gross profit was $531,000 and the Revenue per tonne sold $ 47 33 Production cost per tonne sold $ (30) (32) gross margin was 36%, compared to Gross Profit per tonne sold $ 17
Slide 8: Verde Agritech PLC Full Year Results
Verde Agritech PLC Full Year Results All amounts in CAD $’000 FY 2019 FY 2018 • Revenue increased 344% YoY Tonnes sold ‘000 120 29 • Gross profit was $2,864,000 and the Revenue per tonne sold $ 50 45 Production cost per tonne sold $ (26) (36) gross margin was 48%, compared to Gross Profit per tonne
Slide 9: 2020 Outlook Until Mid 2021
2020 Outlook Until Mid 2021 A. Assuming no permitted production increases • Current Production Capacity: 500,000 tpy • Current Permitted Production: 198,800 tpy • All-in Group breakeven point: 140,000 tpy • Sales Target for 2020 of $10.6M: increase of 76%year-on-year-on track to achieve this • Proje
Slide 10: 2020 Outlook
2020 Outlook B. Assuming permitted production increases and additional sales growth • 2019 revenue per tonne: $50 • 2019 production costs per tonne: $26 • Note impact of 2020 FX Movements and oil prices to date on Income Statement and Balance Sheet 10
Slide 11: How the COVID-19 crisis is impacting Verde
How the COVID-19 crisis is impacting Verde
Slide 12: How the COVID-19 crisis is impacting Verde
How the COVID-19 crisis is impacting Verde The Brazilian Ministry of Agriculture, Livestock and Supply declared that Fertilizer Production is an essential activity in the food and beverage production chain, essential to guarantee supply and food security of the Brazilian population. Ordinance No. 11
Slide 13: Soy beans
104 102 100 98 Soy beans 96 94 Crop prices (R$) 92 90 88 86 84 30-Jan 9-Feb 19-Feb 29-Feb 10-Mar 20-Mar 30-Mar 9-Apr 13 Source: https://www.cepea.esalq.usp.br/br/indicador/soja.aspx
Slide 14: Corn
61 60 59 58 57 Corn 56 55 Crop prices (R$) 54 53 52 51 50 30-Jan 9-Feb 19-Feb 29-Feb 10-Mar 20-Mar 30-Mar 9-Apr 14 Source: https://www.cepea.esalq.usp.br/br/indicador/soja.aspx
Slide 15: Coffee
590 570 550 Coffee 530 Crop prices (R$) 510 490 470 450 30-Jan 9-Feb 19-Feb 29-Feb 10-Mar 20-Mar 30-Mar 9-Apr 15 Source: https://www.cepea.esalq.usp.br/br/indicador/soja.aspx
Slide 16: Dollar/Real FX suffered an increase of 16% in March and 30% in 2020
Dollar/Real FX suffered an increase of 16% in March and 30% in 2020 5.50 5.30 5.10 4.90 USD/BRL Graph 4.70 1 USD = 5.2287 BRL (April 01, 2020) 4.50 4.30 4.10 3.90 3.70 3.50 12-Oct 1-Dec 20-Jan 10-Mar 29-Apr 16 Source: https://br.tradingview.com/symbols/USDBRL
Slide 17: SELIC Rate
SELIC Rate Brazil’s Federal interest Rate 7.0% 6.5% 6.0% 5.5% 5.0% 4.5% 4.0% 3.5% 3.0% Feb-19 Mar-19 May-19 Jul-19 Aug-19 Oct-19 Dec-19 Jan-20 Mar-20 Apr-20 17 Source: https://www.bcb.gov.br/controleinflacao/historicotaxasjuros
Slide 18: Soybean x Potash
Soybean x Potash the best exchange ratio in 5 years The rise in the dollar impacted fertiliser prices in the Brazilian market. A survey carried out by the consultancy INTL FCStone, indicated an increase of 12.7% in the tonne of potassium in March. Despite the recent increase in soybean prices, which
Slide 19: Brazil is feeding the world in a sustainable manner
Brazil is feeding the world in a sustainable manner
Slide 20: Source: government and market data
Source: https://www.gov.br/agricultura/pt-br/assuntos/noticias/dados-da-nasa-demonstram-que-apenas-7-6-da-area-do-brasil-e-ocupada-por-lavouras / 20 https://www.infoteca.cnptia.embrapa.br/bitstream/doc/986147/1/DOC402.pdf / https://tradingeconomics.com/brazil/agricultural-land-percent-of-land-area-w
Slide 21: Brazilian farmers are the world's biggest forest protectors
Brazilian farmers are the world’s biggest forest protectors 21 21
Slide 22: Every day you probably eat or drink something grown in Brazil
Every day you probably eat or drink something grown or cultivated in Brazil Major exporters of Major exporters of Major exporters of Soybeans 1 Coffee 2 Beef 3 1. Brazil 1. Brazil 1. Brazil 2. United States 2. Vietnam 2. India 3. Argentina 3. Colombia 3. Australia Major exporters of Major exporters
Slide 23: Brazil's dependency on imported potash
Brazil’s dependency on imported potash
Slide 24: Our mine is located in Brazil
OUR MINE IS LOCATED IN BRAZIL, THE WORLD`S BIGGEST IMPORTER AND 2nd LARGEST CONSUMER OF POTASH 24 *Source: https://www.brasilagro.com.br/conteudo/importacao-de-fertilizantes-pelo-brasil-e- 24 recorde-em-2019.html
Slide 25: This also adds chloride to soils and food chain
THIS ALSO ADDS ~5 MILLION TONNES OF CHLORIDE TO SOILS AND FOOD CHAIN EVERY YEAR 25 25
Slide 26: Agritech trace elements
*Source: https://verde.ag/blog/solo/microrganismos-do-solo-podem-ser-a-solucao-no- 26 26 combate-ao-aquecimento-global
Slide 27: Source: dioxins and trace chemistry references
*Source: Ronald, A. Dioxins: An Overview and History. Environmental Science & Technology, 2011 45 (1), 16-12. Available at: https://pubs.acs.org/doi/full/10.1021/es1013664 27 Bumb, R.R.: Crummett, W.B.; Cutle, S.S.; Gledhill, J.R.; Hummel, R.H.; Kagel, R.O.; Lamparski, 27 L.L.; Luoma, E.V.; Miller,
Slide 28: Agritech trace elements
AGRITECH 60 trace elements, it
Slide 29: Verde's solution
\' VERDE AGRITECH Verde’s solution
Slide 30: Mine Agritech process
MINE AGRITECH PROCESS IN m~¢ SELL THEPRODUCT [ ISCALLED: rote err IS SOLD AS:
Slide 31: Premium priced potassium fertilizer
MORE RECENTLY, GIVEN ITS RESTRICTED SUPPLY, IT WAS SOLD IN THE US AS A PREMIUM PRICED POTASSIUM FERTILIZER UNTIL THE LAST MINE WAS FORCED TO SHUT DOWN IN 2017. 31 *Source: 31 Greensand and Greensand Soils of New Jersey: A review, J. C. F. Tedrow, 2002. State University of New Jersey. Bulletin, page
Slide 32: Source: NI 43-101 Pre-Feasibility Technical Report
32 *Source: 32 pages 127 and 138 from NI 43-101 Pre-Feasibility Technical Report Cerrado Verde Project, Minas Gerais, Brazil
Slide 33: Source: NI 43-101 Pre-Feasibility Technical Report
33 * Source: pages 207 from NI 43-101 Pre-Feasibility Technical Report Cerrado Verde Project, Minas Gerais, Brazil. 33
Slide 34: Outstanding project economics
Outstanding project economics because our delivered cost is the lowest among all producers* US$/MT *Source: page 28 from Scotiabanks - Materials: Global Fertlizers Spring 2017 and page 198 from N1 43-101 Pre-Feasibility Technical Report Cerrado Verde Project, 34 Minas Gerais, Brazil Our cost per ton
Slide 35: Capital Expenditure is also the lowest
Capital Expenditure is also the lowest C$ M per ton of K2O production capacity K+S $3.000,0 0 $3.000,0 0 LEGACY Plant 1 is already built and in $2.500,00 $2.500,00 operation. CAPEX per ton of K20 production capacity was $44, lower $2.000,00 $2.000,00 than the $153 projected on PFS*. $1.500,0 0 $1.50
Slide 36: Permits
Permits In total, the Group is currently fully permitted to produce 199,800 tpy and has applications pending for an additional 283,000 tpy* Mining Permits (tpy) Environmental Licenses (tpy) Fully Mine Permitted to Produce (tpy) Pending Pending Granted Granted Applications Applications 1 0 233,000 0
Slide 37: Phase Target
Phase 3 Target:* R$2,000,000,000 Phase 2 Target:* We began production in 2017 R$576,000,000 renting a small plant. In 2018, we Target: built our first plant and the R$32,000,000 product sold out. In 2019, we expanded plant production capacity to 500 tpy 2017 2018 2019 2020 2017 Revenue: 2018 2019 20
Slide 38: Sales Structure
Sales Structure Sales and Marketing Team Independent Sales Agents 2019: 11 people 2019: 41 sales agents 2020: 27 people 2020: 85 sales agents Distributors Distributors’ Sales Team 2019: 13 distributors with 28 stores 2019: 89 people 2020: 22 distributors with 39 stores 2020: 161 people 38 38
Slide 39: Source: Management's Discussion and Analysis
39 *Source: 39 Management’s Discussion and Analysis for the period ended September 30, 2019
Slide 40: Customers are willing to pay premium prices
\' VERDE BUT THE PRODUCT IS SO GOOD, CUSTOMERS ARE WILLING TO PAY UP TO $3000 PER TON WHERE IT IS SCARCE. > ~~ READ ONLINE OTHER REVIEWS FROM OUR US CUSTOMERS.
Slide 41: Agritech
AGRITECH COSTS THE SAME OFFERS FREE BENEFITS CONVENIENCE
Slide 42: Verde's Self-Financing Business Model
Verde’s Self-Financing Business Model • Total Capex for 500,000 tpy plant was $2,3M • Running at 100% capacity the plant generates free cash flow of $14.1M per annum • Running at 75% capacity the plant generates free cash flow of $10,6M per annum • Running at 50% capacity the plant generates free ca
Slide 43: Brazil's Crop Planting
Brazil’s Crop Planting Harvest Calendar Crop Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec K Forte® Application Soybeans Harvest Planting K Forte® Application Corn Harvest Harvest (Safrinha - Second Crop) Planting (Safrinha - Second Crop) Planting K Forte® Application Cotton Harvest Planting K For
Slide 44: Cristiano Veloso, founder and CEO
Cristiano Veloso, founder and CEO, owns ~7.3M shares. Since found the Company in 2005 he has never sold a single share, only purchased more shares, and is paid in shares, not cash.* 44 44 44
Slide 45: Why Verde
WHY " " Y=. VERDE, | 9 OC W H Y N 0 W CROP NUTRITION CROP PROTECTION ORGANIC AGRICULTURE |. IN PRODUCTION 2. HUGE MINERAL RESOURCE 3. SCALABLE PROJECT 4. PRODUCT IS DISRUPTIVE 5, FEW SHARES OUTSTANDING 3. DR ALYSSON PAOLINELLI IS A DIRECTOR 7. SIGNIFICANT DEVELOPMENTS FOR THE COMING MONTHS
Slide 46: Appendix
\' VERDE AGRITECH APPENDIX
Slide 47: Dr. Alysson Paolinelli
47 DR. ALYSSON PAOLINELLI Dr. Paolinelli holds a degree in Agronomy from the Federal University of Lavras (UFLA). He has held positions such as the Brazilian Minister of Agriculture, the President of the National Confederation of Agriculture, and the Secretary of Agriculture for Minas Gerais State.
Slide 48: Getulio Lamartine
48 GETULIO LAMARTINE Gettilio Lamartine holds a degree in Economics from the Federal University of Minas Gerais (UFMG). He is a senior economist with over 40 years of government and consulting experience in the Brazilian resource, electrical and power generation sectors, having served as Deputy Mini
Slide 49: Super Greensand versus conventional potash
\' VERDE AGRITECH SUPERGREENSAND® VS. CONVENTIONAL POTASH Super Greensand® Conventional (KCI) Year of Launch: 2017 1861 K, Mg, Mn, Fe, Si, Co and traces of 60 other Nutrients: minerals including all plant essential macro and micronutrients Plant Nutrients Concentration 77% 60% sly ware i Product's l
Slide 50: Economic-financial analysis of the Project
\' VERDE AGRITECH BNA Consultoria e Sistemas NI 43-101 Technical Report — Cerrado Verde Project Page 201 50 Table 22.2-1 Economic-financial analysis of the Project
Slide 51: Cash Flow Profile
\' VERDE AGRITECH BNA Consultoria e Sistemas NI 43-101 Technical Report — Cerrado Verde Project Page 203 Cash Flow Profile (USS Millions) 500 9.000 400 300 6.000 = 3,000 100 0 0 -100 200 -3.000 “ee ~6.000 ~400 -500 -9.000 -1 1 2 3 4 5 6 7 8 9 12 19 26 29 32 36 Year mms Capex mmm Free Cash Flow me Op
Slide 52: One Company, Investment Themes Exposure
\' VERDE AGRITECH ONE COMPANY, 4 INVESTMENT THEMES EXPOSURE CROP PROTECTION VERDE’S PRODUCTS MAKES CROPS MORE RESISTANT AGAINST PESTS AND DISEASES WATER VERDE’S PRODUCTS IMPROVE SOIL'S WATER HOLDING CAPACITY, ENHANCES CROP WATER USAGE EFFICIENCY AND MAKES CROPS MORE RESISTANT AGAINST DROUGHT CROP NU