Altech Batteries Limited · ASX:ATC
Altech Batteries — Altech Chemicals — ASX Spotlight Series Asia 2016
28 slides from Altech Batteries's conference presentation, Oct 25, 2016
Slide 1: Meeting a Sapphire Future
Altech Chemicals Limited (ASX:ATC) For personal use only ASX Spotlight Series Hong Kong 25 Oct 16 Singapore 27 Oct 16 “Meeting a Sapphire Future” Iggy Tan Managing Director
Slide 2: For personal use only
For personal use only
Slide 3: Sapphire & Ruby
For personal use only • Sapphire & Ruby • Natural form of high purity alumina (HPA) Sapphire • Formed by mother nature like diamonds • Colour from impurities Gemstone • Nearly as hard as diamond (Moh 9)
Slide 4: What is HPA?
For personal use only • Purified alumina (Al2O3) • Greater than 99.99% (4N) purity • Smelter Grade Alumina (SGA) ~ 99.5% (5,000 ppm impurities mainly sodium) • Bayer Process uses sodium hydroxide What is HPA? (NaOH) • Sodium impurity is problem for electronics industry
Slide 5: High Price for Purity
For personal use only Smelter Grade Alumina High Purity Alumina High Purity Alumina High Purity Alumina High Price SGA 99.5% $400 per t HPA 99.9% (3N) $6,000 per t HPA 99.99% (4N) $23,000 per t HPA 99.999% (5N) $50,000 per t for Purity Our Target Business
Slide 6: Sapphire Production
Sapphire Production For personal use only HPA Furnance Sapphire crystal boule
Slide 7: Sapphire Wafer Production
Sapphire Wafer Production For personal use only Sapphire wafer Sapphire glass screen
Slide 8: LEDs lights of the future
LEDs lights of the future For personal use only Conventional LEDs New LED products
Slide 9: Uses of HPA
For personal use only High Purity Alumina Applications Semi Phosphor LEDs Other Based conductors Applications Applications Uses of HPA Phosphor 99.99% 4N Smartphone and Others 10% 12% Lithium batteries are new markets Semiconductors 21% LED 57% Source: Persistence Research “High Purity Alumina Marke
Slide 10: Demand for HPA
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% Demand • Driven by LED growth & Lithium batteries for HPA • Entering a fast growing market Source: Persistence Research “High Purity Alumina Market – Global Industry
Slide 11: Global High Purity Alumina Forecast
For personal use only Global High Purity Alumina Forecast 2015 -2014 Source: Persistence Research “High Purity Alumina Market – Global 86,831 Industry Analysis and Forecast 2016-2014 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 2017 2018
Slide 12: Lithium Battery Separator
Lithium Battery Separator For personal use only Anode Sheet Separator Cathode Sheet
Slide 13: Sapphire Glass Scratch Test
Sapphire Glass Scratch Test For personal use only
Slide 14: Geographic Demand for HPA
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 15: 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 16: 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 US$3,000 per tonne ALTECH HPA PLANT One Single Process Step Aluminous Clay 99.99% HPA
Slide 17: Processed by mother nature
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 18: Altech owns 100% of deposit in W Aust
For personal use only • Altech owns 100% of deposit in W Aust • Low environmental impact • 12 Mt JORC Resource Meckering • > 250 year mine life Kaolin Deposit • 130kms from Fremantle Port • Mining lease granted
Slide 19: Altech's HPA Process
For personal use only • Use a standard HCl leach process • Developed in 1980’s by alumina industry • Couldn’t compete with Bayer SGA costs • But great at producing HPA (no sodium Altech’s ions) HPA • However little demand of HPA in 1980s Process • Demand of HPA is here today
Slide 20: 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 21: Highly Attractive BFS
For personal use only • Capital cost estimate US$78.7m • Payback period 3.7 years • Pre-tax NPV9 of US$357.5m • Highly attractive IRR of 33.3% Highly • Operating cost of US$9,070/t Attractive • Sale price of US$23,000/t BFS • Margin of US$13,930/t • EBITDA US$55.7m pa Last updated March 2016 21
Slide 22: Bottom Quartile for Op Costs
For personal use only • Breakaway - competitors US$14-17,000 /t 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 Research “High Purity Alumina Market – Global Industry Analysis and Forecast 2016-2024
Slide 23: Off take sales with Mitsubishi
For personal use only • Off take sales with Mitsubishi • First ten years of HPA operations • Secures sales for 100% of 4,000tpa HPA Mitsubishi production • Exclusive global distributor with well established signs full global customer base off take Contract Forecast Contracted Contract Forecast Contr
Slide 24: Debt funding with KfW IPEX Bank
For personal use only • Debt funding with KfW IPEX Bank • 60% of plant – German suppliers • Target of US$70m We are at the • Export Credit cover of $60m • Target sole lender – KFW IPEX Bank funding • M+W Group as general contractor stage
Slide 25: HPA bank due diligence nearing completion
For personal use only • HPA bank due diligence nearing completion • No fatal flaws identified • Positive pre-assessment German inter- ministerial committee Project • Detailed design progressing as planned Update • Permitting for Malaysian HPA plant commenced • Mining proposal at Meckering
Slide 26: Raise $10m in oversubscribed placement
For personal use only • Raise $10m in oversubscribed placement • Market cap ▲470% in last 12 months • Shareholders ▲600 1,500 Altech • Liquidity daily trade ▲$3k $200k /day Chemicals
Slide 27: Timeframe to market
For personal use only • Debt funding term sheet agreed Q1 2017 • Capital cost estimate avail half way through detailed design phase • Project equity Q2 2017 Timeframe to • Site works commencing Q2 2017 market • 18 months construction • First product due early 2019
Slide 28: 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