Cadiz, Inc. · NASDAQ:CDZI
Cadiz — Investor Presentation (November 2024)
31 slides from Cadiz's investor presentation, Nov 4, 2024
Slide 1: Safe Harbor Agreement - Forward-Looking Statements
Safe Harbor Agreement 2 Forward - Looking Statements Information contained in this presentation that discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, are forward - loo
Slide 2: Experienced Management Team
Experienced Management Team Susan Kennedy Chairman and Chief Executive Officer 3 Stan Speer Chief Financial Officer Cathryn Rivera Chief Operating Officer • CEO since Jan 2024 • Cadiz Board since 2021 • CEO of AMS • Chief of Staff to CA Gov. Schwarzenegger • CA Public Utilities Commission • Cabinet
Slide 3: Cadiz is a California water solutions company
Founded in 1983, Cadiz is a California water solutions company with uniquely valuable assets to provide clean, reliable and affordable water for people. Land Water Storage Treatment Pipelines Supply Land Resources Storage Treatment Conveyance Clean Water Solutions New Water Supply - 50,000 acre - fe
Slide 4: From project developer to fully-integrated solution provider
8 From project developer to fully - integrated solution provider. Today Today Tomorrow Largest groundwater bank in the Southwest, with asset value unlocked via partnership with Native American Tribes & Non - Profit Public Sector Entities Highly differentiated water, pipeline and technology assets wi
Slide 5: About the Mojave Groundwater Bank
About the Mojave Groundwater Bank Note - 1 acre - foot = 326,000 gallons of water • Large aquifer at base of a 2,000 sq. mile watershed system in the eastern Mojave Desert (San Bernardino Co, California) located between major water infrastructure systems serving Southwestern U.S. population centers.
Slide 6: Mojave Groundwater Bank compared to Lake Mead
Mojave Groundwater Bank compared to Lake Mead – America’s Largest Reservoir 250 miles 2 160,000 acres 28 million acre - feet storage capacity Cadiz 2,000 miles 2 1.2 million acres 30 - 50 million acre - feet water in storage Lake Mead 7
Slide 7: A fully operational groundwater bank would facilitate water trading and exchanges
A fully operational groundwater bank at Cadiz would facilitate water trading & exchanges across California and the Southwest - $800M Construction Capital Investment Required. 8 8
Slide 8: Value of Water
Source: Metropolitan Water District - https:// www.mwdh2o.com/budget - finance/ Value of Water New Supply $1,650/ AF (delivered) Cadiz Supply/ MGB $2,200/AF Desalination (Doheny) $1,830/AF (assumes subsidies) Carson Recycling $3,125/AF Charles E. Meyer Desal Plant Storage $1,500/AF reserve capacity
Slide 9: 2024 Highlights
2024 Highlights x Project Construction Financing Plan anchor LOI in October for initial $150M Investment . x Long - term water purchase agreements signed for 85% capaci ty (21,275 AFY) of the Northern Pipeline including disadvantaged communities along the pipeline route. x Rapid growth of the ATEC w
Slide 10: Construction Finance Entity
Construction Finance Entity • 51% of cash flow from water storage sales / banking operations • 100% of Wheeling fees from moving water supply in pipelines • 100% of CapEx reimbursement from water supply contracts. • Return on Capital investment, then agreed upon profit share with Cadiz after certain
Slide 11: Newco LLP/LLC Sources & Uses
Newco LLP/LLC Sources & Uses The following is the estimated sources and uses for the Newco LLP/LLC funding of project construction costs: ($ in 000s) Uses: Sources: Upfront Payment to Cadiz Inc. 51,000 150,000 Investor under non - binding LOI Construction Costs (estimated): 201,000 Tribal Entities N
Slide 12: NewCo Cash Flows Forecast
NewCo Cash Flows Forecast Water Supply Cash Flows Water Storage / Groundwater Banking Cash Flows 13 Contract Price Cap = $1,650 per AFY up to 50,000 AFY Reservation Fees - $1,500 per AF for 1 million AF of storage capacity $350 - $500/AF $150 - $300/AF $850 / AF Capital Costs Estimated O&M/ Wheeling
Slide 13: Illustrative Cash Flow Outlook to Cadiz
Illustrative Cash Flow Outlook to Cadiz Start Date (6) Cumulative Project CF Average Annual CF (1) Net $ per AF 2026/2027 $2.5 B $50 M $ 850.00 Water Supply 2028 $735 M $52.5M (3) $ 735.00 Water Storage (2) Reservation Fees 2028 $750 M $15 M $ 12.25 Management Fees 2027 $20M Newco Ownership Interest
Slide 14: Summary
Summary * Solution part of New Cadiz Water Supply Water Storage Water Transport + + + Water Treatment • 45,000 acres of land with water rights in the Mojave Desert. • 2,000 square mile watershed with approx. 30 - 50 million AF of water in storage - 2X Lake Mead • ROW to build new pipeline to CO Rive
Slide 15: Capitalization Table
Capitalization Table 16 ($ in millions) Pro Forma 6/30/24 Transaction Adjustments As of 6/30/24 $29.1 $18.5 (6) $10.6 Cash and Cash Equivalents $21.2 $21.2 Senior secured (non - convertible) term loan (1) $20.5 $20.5 Senior secured (convertible) term loan (2) $16.6 $16.6 Senior unsecured convertible
Slide 16: Contacts
www.cadizinc.com NASDAQ: CDZI Contacts: Stan Speer, CFO sspeer@cadizinc.com Courtney Degener, VP - IR cdegener@cadizinc.com
Slide 17: Appendix – Management & Board
Appendix – Management & Board
Slide 18: About Chairman & CEO Susan Kennedy
Investor Presentation | 2024 About Chairman & CEO Susan Kennedy • Joined Board in February 2021, elected Chairman in February 2022, & appointed CEO in January 2024 • Led a distinguished career as a policymaker and entrepreneur • Built a formidable reputation through two decades at the highest levels
Slide 19: Kennedy's Leadership Backed by New Board of Directors
Kennedy’s Leadership Backed by New Board of Directors Stephen E. Courter Independent Director • Over 30 years of experience in management positions in the technology/telecommunications industry • Faculty of the McCombs School of Business, University of Texas at Austin teaching MBA courses in strateg
Slide 20: Appendix - Climate Change impacts on Water in the West
Appendix - Climate Change impacts on Water in the West 21
Slide 21: The hydrological cycle is spinning out of balance
“The hydrological cycle is spinning out of balance…” WMO State of Global Water Resources Report 2022 Droughts, extreme rainfall events, melting snow and ice… threaten long - term water security for billions of people. 22
Slide 22: The Water Planet
The Water Planet 23 The problem is not water scarcity
Slide 23: The End of Snow Threatens to Upend Million American Lives
The End of Snow Threatens to Upend 76 Million American Lives 24 The problem is snow
Slide 24: Snowpacks in the west are steadily declining
Snowpacks in the west are steadily declining May 2024 Source: California Dept of Water Resources 25
Slide 25: Where do we store freshwater?
30% Snowpack 60% Reservoirs 40% Groundwater Where do we store freshwater? Snow and snowmelt make up more than half our water supply 26
Slide 26: Extreme is the new normal
Extreme is the new normal Western megadrought is worst in 1,200 years, intensified by climate change. California has so much snow that flood danger will last through the year. 2022 2023 27
Slide 27: Climate whiplash pattern began with the 1976 drought
Climate “whiplash” pattern began with the 1976 - 77 drought May 2024 Source: WRCC, 2022 https://oehha.ca.gov/media/02precip.pdf Statewide annual precipitation (1895 – 2021) 28
Slide 28: Climate whiplash pattern began with the 1976-77 drought
Climate “whiplash” pattern began with the 1976-77 drought Precipitation (inches) Statewide annual precipitation (1895-2021) Ha = 1920 i ment Precipitation a 1945 1970 Water Year Average he = 1995: el 2020 Auiqeuen uoneydicesd 30-year moving variance 4 Cadiz Source: WRCC, 2022 https://oehha.ca.gov/me
Slide 29: Snowmelt and precipitation are moving South
Snowmelt and precipitation are moving South Source: California Dept of Water Resources Source: Data from USGS CA Dept Water Resources 30
Slide 30: Most of our water storage systems are in the North
Most of our water storage systems are in the North Source: California Dept of Water Resources Source: Data from USGS CA Dept Water Resources Our water storage and conveyance system was designed to capture predictable Sierra snowmelt, not flash floods and atmospheric rivers 31
Slide 31: Most of our water storage systems are in the North
SS Most of our water storage systems are in the North I California Water Supply and Storage weer || Reservoir Capacity ‘Bere Feet) Precipitation Percentage of Average As of September 30, 2023 20% 40 60 80 100 120 140 160 180 +200 Source: California Dept of Water Resources Our water storage and “@. »