Altech Batteries Limited · ASX:ATC
Altech Batteries — Altech Chemicals — Gold Coast Investment Showcase (June 2015)
40 slides from Altech Batteries's conference presentation, Jun 18, 2015
Slide 1: Company Presentation - Gold Coast Investment Showcase
Altech Chemicals Limited (ASX:ATC) For personal use only Company Presentation Gold Coast Investment Showcase Iggy Tan Managing Director
Slide 2: Our Vision
For personal use only To be a world leading producer of high purity alumina (HPA) Our Vision
Slide 3: Sapphire & Ruby - natural form of HPA
For personal use only • Sapphire & Ruby - natural form of high purity alumina (HPA) • Formed by mother nature like diamonds • Colour from impurities Sapphire • Extremely hard – no. 9 on Mohs scale Gemstone • Third hardest mineral behind diamond • Scratch-resistant artificial sapphire glass made from
Slide 4: What is HPA?
For personal use only • Purified alumina (Al2O3) • Greater than 99.99% (4N) purity • Maximum allowable impurities of 100ppm • Smelter Grade Alumina (SGA) ~ 99.5% (5,000 ppm impurities mainly sodium) What is HPA? • Bayer Process uses sodium hydroxide (NaOH) • Sodium impurity is problem for electronic
Slide 5: Artificial Sapphire Process
For personal use only • HPA is placed in an autoclave • Heated to >2,000oC melting point under intense pressure • Forms single crystal sapphire (boule) Artificial • Allowed to cool slowly – 22 day cycle Sapphire • Diamond cutting equipment to cut sapphire shapes Process • Heat & scratch resistant
Slide 6: For personal use only
For personal use only
Slide 7: Our Target Business
For personal use only Smelter Grade Alumina High Purity Alumina High Purity Alumina High Purity Alumina High Price SGA 99.5% $0.4 per Kg HPA 99.9% (3N) $1 -10 per Kg HPA 99.99% (4N) $10-50 per Kg HPA 99.999% (5N) $50-150 per Kg for Purity Our Target Business
Slide 8: Welcome to the World of HPA
Welcome to the World of HPA For personal use only Sodium Lamps Hybrid Cars Display Screens Abrasives Ceramic Ultrafiltration Electronic Substrates Tools Special Ceramics Semiconductors HP Refractory Polishing Cosmetics Medical Abrasives Separation Headlights Membranes LED Lighting Optical Lenses Ind
Slide 9: Uses of HPA
For personal use only High Purity Alumina Applications Semi Phosphor LEDs Other Based conductors Applications Applications Uses of HPA 99.99% 4N Smartphone Others Phosphor sapphire glass is 7% 16% a new market Semiconductors 22% LED 55% Source: Technavio Research “2014-2018 Global High-purity Alumin
Slide 10: For personal use only
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Slide 11: Demand for HPA
For personal use only Technavio Research • Global HPA demand 19,040tpa in 2014 • Expected to increase to 48,230tpa by 2018 Demand • Growing at a CAGR of 28% for HPA QY Research • Global HPA demand 24,550tpa in 2014 • Expected to grow to 36,000tpa in 2017 • Growing at a CAGR of 16%
Slide 12: HPA Demand & Growth Forecast
For personal use only HPA Demand & Growth Forecast 60.0 50.0 48.2 39.9 40.0 30.0 25.3 32.4 Demand 20.0 14.1 19.0 for HPA 10.0 0.0 2013 2014 2015 2016 2017 2018 Volume ktpa Source: Technavio Research “2014-2018 Global High-purity Alumina Market” Global shipments of LED lamps forecast to increase from
Slide 13: Apple Watch
For personal use only • Apple moving to chic wearable vs geeky tech • Glass is all Sapphire • Wearable tech items 45.7m, up 133% Apple • By 2019, 126m units (ave growth 45%) • Apple Watch will raise the profile of wearables Watch • Profile of sapphire glass will be raised globally • Long term benefi
Slide 14: For personal use only
For personal use only
Slide 15: HPA Demand from Smartphones
For personal use only • Estimate 30g1 of HPA in an iPhone sapphire glass screen • 500 million smartphones sold per year • If sapphire glass technology was implemented HPA o It would require about 15,000tpa of HPA Demand from o That’s four of our proposed 4,000tpa plant Smartphones • There will be a
Slide 16: Smartphones with Sapphire Crystal Screen
For personal use only • High end Vertu TI with sapphire crystal screen • Rest will follow Smartphones Sapphire Crystal Screen
Slide 17: More Sapphire Display Factories
For personal use only More Sapphire Display Factories “company (Apple) continues to cautiously evaluate the adoption of the scratch-resistant screens to ensure that there are sufficient supplies” Focus Taiwan News Channel
Slide 18: HPA Geographic Demand
For personal use only • 70% of HPA demand - Asia Pacific region (APEC) • Region for the world’s manufacturing • Altech’s HPA plant (Malaysia) well-positioned HPA to service APEC region • Transport, customer service, technical Geographic credibility Americas Demand 14% Europe, Middle East, Africa 16%
Slide 19: Current HPA Producers
For personal use only • Six largest HPA producers • 3 Chinese, 1 Japanese, 1 Sth African, 1 French Sumitomo Chemical , 3,020 Huantou, 800 Others (15), 3,570 Sasol, 1,800 Current HPA Dailian Rall, 600 Producers Nippon Light Metal, 1,100 Baikowski, 1,200 Hebei Pengda, 3,000 Xuancheng Jing Rui, Zibo Xi
Slide 20: Altech's Differentiation
Altech’s Differentiation For personal use only Current HPA Producers Alumina Alumina Aluminium Refinery Smelter Dissolution Bauxite Smelter Grade Alumina 99.8% Aluminium Metal 99.99% HPA Or other high purity Al compounds ALTECH HPA PLANT One Single Process Step Aluminous Clay 99.99% HPA
Slide 21: Low-impurity Aluminous Clay Feedstock
For personal use only • Processed by mother nature • Very low Iron (Fe) due to weathering • Silica is non reactive – easily removed Bauxite Canadian Altech Low-impurity Darling HPA HPA Range * Project Project Aluminous Clay Al2O3 (%) 34.5 22.77 30.5 Feedstock SiO2 (%) 21.5 53.29 56.3 Fe2O3 (%) 21.2
Slide 22: Meckering Aluminous Clay Deposit
For personal use only • Altech owns 100% of deposit in W Aust • Landowner agreement in place • No native title • Low environmental impact Meckering • Previously mined for kaolin – trial pit Aluminous Clay • Low stripping ratio Deposit • 65Mt JORC Resource • 130kms from Fremantle Port
Slide 23: Current HPA Feedstock Costs
For personal use only • Majors like Sumitomo, Sasol: o Aluminum alkoxide from Al metal • Chinese producers: o Choline – Dissolving Al foil in choline Current HPA • All use relatively expensive feedstock Feedstock • Altech aluminous clay 5 times cheaper than Al metal feedstock Costs Feedstock USD per
Slide 24: Altech's HPA Process
For personal use only • Use a standard HCl leach process • Standard metal extraction • Developed in 1980’s by alumina industry • Couldn’t compete with Bayer SGA costs Altech’s • But great at producing HPA (no sodium ions) HPA • However little demand of HPA in 1980s Process • Demand of HPA is here to
Slide 25: High Purity Altech Business Strategy
For personal use only New HPA Demand + Established Process + Great Deposit + Experienced People Shareholder Value Experienced People High Purity Altech New Demand Deposit Business (Electronics) Strategy Established HPA HCl Process “the last piece of the puzzle is in place”
Slide 26: Development Program To Date
For personal use only • Started development work in early 2011 • Many studies and testwork programs • No issues about producing 99.99% HPA • Supporting lab pilot plant test work Development • Hydromet process not complex Program • Conventional proven plant and equipment • Integrated Plant Study (IPS
Slide 27: Altech HPA Process
Altech HPA Process WESTERN AUSTRALIA For personal use only Campaign Mining ROM Screening Filter Press Beneficiated Kaolin To Fremantle Drum Scrubber > 0.5mm Dryer Shipping Calcined Clay Feed Storage Hydrochloric Acid Cooler Calciner HCl Gas Milling Polishing Filter Filter 600 C MALAYSIA Screening St
Slide 28: Bankable Feasibility Study (BFS)
For personal use only • To be a top HPA producer in the world • Launched BFS for 4,000tpa HPA • BFS completion: end Q3 2015 • In parallel, progress permitting, approvals, Bankable funding, off- take agreements etc. Feasibility • Subject to funding: Study (BFS) • In position to order long lead capita
Slide 29: Meckering Operation
Meckering Operation For personal use only Hopper Feed Feed Conveyor ROM Stockpile Product Storage Workshop Dryer Filters Screening Oversize Load Out Water Raw Offices Generator
Slide 30: Meckering Plant
Meckering Plant For personal use only Filtration Oversize Disposal Drum Scrubber Screening Dryer Filtration ROM Feed Dryer Baghouse
Slide 31: Meckering Plant
For personal use only Meckering Plant
Slide 32: Beneficiated Kaolin Shipping
Beneficiated Kaolin Shipping For personal use only
Slide 33: Preferred HPA Location: Tanjung Langsat, Johor Bahru
For personal use only • Tanjung Langsat Industrial Park, Johor Bahru (Malaysia) • Al clay feedstock shipped from WA • Operating costs ~40% lower than Australia HPA Preferred • Capital costs expected to be 50-60% lower Location • Anticipates opex in the bottom quartile of global HPA producers • Lette
Slide 34: Malaysian HPA Operation
Malaysian HPA Operation For personal use only HPA LOCATION • Hydrochloric acid, sulphuric acid, power & natural gas • Cement plants to purchase silica residue • International container sea-port & Singapore • Investment incentives
Slide 35: Malaysian HPA Operation
Malaysian HPA Operation For personal use only Acid Leach Cooler Silica Neutralisation Feed Calciner Beneficiated Kaolin Warehouse Silica Removal Purification Jet Milling & Bagging Roaster Product Calciner Final Product Product Cooler
Slide 36: Malaysia HPA Plant
For personal use only Malaysia HPA Plant
Slide 37: Bottom Quartile Operating Costs
For personal use only • IPS pilot plant opex around A$8.6 /kg • Breakaway estimates competitors $14-$17 /kg • HPA sells for around A$23 /kg • Bottom quartile for operating costs – Why? Bottom 1. We own our feedstock Quartile 2. Large scale economy 4,000 tpa – one train for Op Costs 3. Main reactant
Slide 38: Valuation
For personal use only EV/EBITDA Multiple Valuation • 7.5 x EV / EBITDA multiple, Price $20/kg, Opex $8/kg = $360m evaluation Breakaway DCF Valuation • Disc @10%, Price $20kg, Opex $8/kg Research = $260m Evaluation Evaluation
Slide 39: Thank you
For personal use only Right Place Right Time Right Feedstock Right Technology Thank you
Slide 40: Forward-looking Statements
For personal use only Forward-looking Statements This announcement contains forward-looking statements which are identified by words such as ‘anticipates’, ‘forecasts’, ‘may’, ‘will’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, ‘plan’ or ‘intends’ and other similar words that involve ris
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