Antelope Enterprise Holdings Limited · NASDAQ:AEHL
Antelope Enterprise — China Ceramics — Investor Presentation (May 2011)
29 slides from Antelope Enterprise's investor presentation, May 13, 2011
Slide 1: Investor Presentation May 2011
Investor Presentation May 2011
Slide 2: Forward-looking statements
This presentation contains forward-looking statements and management may make additional forward-looking statements in response to your questions. Such written and oral disclosures are made pursuant to the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Although we bel
Slide 3: Founded as Jinjiang Hengda Ceramics in 1993
> > Vv Founded as Jinjiang Hengda Ceramics Robust Growth in 1993 FYE Dec 31 a USD in MM Manufactures six different types of ceramics tiles used for exterior siding Ceramic tile market growth correlates with the strong construction and urbanization trends in China Plant capacity to increase by 90% to
Slide 4: NasdaqGM: CCC capitalization snapshot
NasdaqGM: CCC FYE: Dec Price (5/9/11) Primary Shares Outst Market Capitalization $93.1 MM Cash (Mar 31) $13.0 MM Debt (Mar 31) $14.8 MM Revenue (TTM Mar 31 ) $172.5 MM Net Income (TTM Mar 31) $ 35.2 MM Fully Diluted EPS ( TTM Mar 31) $2.33 P/E Ratio 2.19 x * We have 18.25M shares outstanding giving
Slide 5: Company history and milestones
Founded in 1993 as a manufacturer of outdoor ceramics tiles in Acquired Hengdali facility in Jan.’10; Tot. manufacturing capacity of both Hengda & Hengdali expected to reach 72 million sq. meters by 2012 Received the certification of IS09002, ISO9001 and 1$014001 in 1999; Gradually built up brand re
Slide 6: Prominent manufacturer of exterior ceramic tiles
* Prominent manufacturer of exterior ceramic tiles «Intent upon capitalizing upon China’s construction and urbanization trend « Plant capacity expansion enables capture of market share « Motivated distributors and direct sales drive revenue * Product customization enables premium pricing and sustain
Slide 7: China's urbanization trend
» China’s total urban population reached 666 million in 2010 vs. 450 million in 2001 » The scale and pace of China’s urbanization trend is unprecedented: 219 cities of more than 1 million and an aggregate urban population nearing 1 billion are projected by 2025 > Tier | cities are expected to accoun
Slide 8: Tier II and III city construction demand
>» There are fewer restrictions by municipal governments in Tier II and Tier Ill cities >» The 2010 influx of land supply recorded in Tier II and Tier Ill cities will be transferred to the construction pipeline, creating huge demand for materials including ceramics > Central government initiatives s
Slide 9: Beneficiary of long-term urbanization trend
> Beneficiary of China’s long-term urbanization trend > Product trend — New outdoor ceramic tiles products are “Green”, lighter, heat insulating and noise-reducing Vv Potential of Tier Il and III Cities + Much of the growth in China’s GDP is being driven by economic activity in Tier Il and Tier Ill
Slide 10: Highly fragmented industry with hundreds of manufacturers
> China’s outdoor ceramics tile industry is highly fragmented with hundreds of manufacturers >» More than 200 manufacturers are located in Jinjiang, with a combined annual production volume of 70% of China’s total production volume > Others are mainly located in Foshan, Zibo, Linyi, and Dehua, speci
Slide 11: Product range and sales mix
ae Porcelain Rustic 74% of Sales 7% of Sales v, | Ultra Thin 4% of Sales Di ec! men r 1 Polished Glaze New product launched in Q2 2011 Glazed Porcelain 5% of Sale: Wide array of standardized and made-to-order products FY
Slide 12: R&D as key to competitive advantage
» R&D is an integral component of the Company’s culture and a key to its competitive advantage >» The 85 person team has developed over 2,000 types of different product combinations » Awarded Asia's 500 Most Influential Brands of 2010 >» Devised an energy recycling system that reuses excess heat and
Slide 13: Modern production lines
Modern Production Lines Ensure Raw Material Inspecting Plant’s ISO 9001:2000 accreditation signifies high quality control processes 13
Slide 14: Distributor and direct sales channels
Real estate developers 11% of sales International distributors 7% of sales » 89% of products sold to 40 exclusive domestic distributors and 6 international distributors > 11% of products sold directly to larger real estate developers via own sales (orca >» The top ten customers have purchasing from
Slide 15: Sales process
Discuss Meet / Introduction design and Sign to customers product contracts specifications After-sales Delivery conven > Exeellent communication between our sales force and distributors avoids overlapping of sales > Distributors required to make monthly reports on customer requirements » Provide inst
Slide 16: Selected Hengda Projects
¥ Selected Hengda Projects Chengdu Kanjun 7 Z 4y ‘ 53,000 sq. meters China Resources Land Limited Lanxi Town Xiamen Blue Gulf Peninsula 133,000 sq. meters The 11th National Games Village Shenyang Institute of Aeronautical Engineering 97,000 sq. meters 16
Slide 17: Raw materials and suppliers
> Clay and coal are the two major raw materials for tile production, accounting for 47% of COGS » Over 10 years’ cooperation with key suppliers ensures on-time supply and reasonably stable pricing > All raw materials are inspected on delivery for quality control Raw Material % of COGS # of Suppliers
Slide 18: Continued steady demand and competitive strengths
Vv Vv "a Continued steady demand — backlog and channel checks indicate a steady pace of new construction projects. Customized product — nearly all production is built to order for specific projects. High quality manufacturing — ISO certified; international manufacturing equipment. > Quality, well-kn
Slide 19: Capacity expansion plan
|All Capacity fiqures in Square Meters) \Capacity as of Dec 2010 \Current Capacity (2011 Expansion (in aggregate) [Anticipated Completion Date [Targeted Utilization Timeline 1Q1 2011 Expenditures [Remaining Expected Capital Expenditures Total Estimated Capital Expenditures IHengda IHengdali (Total 2
Slide 20: Growth strategy
> Utilize the near doubling of production capacity >» Reach new markets — new Gaoan facility extends reach while reducing costs » Continue to broaden product suite — through innovative R&D > Penetrate new markets — via a broadened distribution network > Evaluate selective M&A opportunities >» Contin
Slide 21: Revenue growth
Wim 4-Year CAGR: 25.2% | Yo owth: 39.7% 50 780) 39.7% 4s 160 ~ 40 140 35 120 - ] 30 100 25 80 » 60 15 > a 81.1 10 20 - 5 0 i — al 2007 2008 2009 2010 Q1 2010 Q1 2011 . om pot exchange rates puilished by www federalreserve gov. For ‘Slatements of comprehensive income data, translation of FMB into U.S
Slide 22: Margin trends
40% 35% 30% 25% 20% 15% 10% 5% 0% + Qi 2010 Q4 2010 Qi 2011 @ Net Profit Profit Before Tax i Gross Margin Planned reduction in OEM outsourcing and increased capacity should continue to improve mar 22
Slide 23: Strong Balance Sheet
Strong Balance Sheet —_— As of Mar 31 As of Dec 31 (USD In millions) 2011 2010 2010 Cash 19.3 39.9 Debt 14.8 13.1 14.7 Total Working Capital 50.5 41.8 62.7 Shareholders’ Equity 144.1 80.5 133.7 Days Sales Outstanding 91 109 95 Inventory Turnover 83 73 73 ROE (TTM) 24% 30% 25% 23
Slide 24: Earn-out escrow shares
siete oe plied Growth Shares Released to Seller 2009 22.3 1,214,127 on 5/26/10 2010 31.4 ~ 40% 1,794,800 on 4/7/11 2011 43.5 ~40% (1) (1) 2,176,836 shares are being held in escrow and remain to be released based on earnings targets; 3,008,927 shares have been released from escrow to date. > Stock Pr
Slide 25: Management team
: Founder of Jinjiang Hengda Ceramics Co., Ltd. In 1993 Jiadong Huang . , . . ca a CEO. Vice Chairman of Fujian Province Ceramic Industry Association and Executive Director of Jinjiang City Chamber of Import and Export Trade 20 years of experience in the China ceramic tile industry Former CFO of a S
Slide 26: Board of directors
Paul K. Kelly Non-Executive Chairman Cheng Yan Davis Ding Wei Dong Bill Stulginsky Audit Committee Chairman Founder and CEO of both Knox & Co., an investment bank, and The Westgate Group, an advisory firm which emphasizes business opportunities in China and Asia Served in senior management positions
Slide 27: Summary: key competitor in a fragmented space
China Ceramics is a key competitor in a highly fragmented space Plant expansion and doubled capacity production will enable more dominant market positioning Sustainable competitive advantage due to capacity expansion, R&D, exclusive distributor relationships and world-class brands Construction mater
Slide 28: Corporate structure
China Ceramics Co. Ltd. (CCCL:NASDAQ) (BVI) Nov 2009 Nov 2009 100% Success Winner Limited (BVI) May 2009 Jun 2009 100% v Stand Best Creation Apr 2008 Jinjiang Hengda Ceramics Co., Ltd. Sep 1993 Jan 2010 100% v Jiangxi Hengdali Ceramic Materials Co., Ltd. Jun 2008 Former SPAC: China Holdings Acquisit
Slide 29: Contact Information
Contact Information China Ceramics Co. Ltd. CCG Investor Relations Edmund Hen, CFO Mr. David Rudnick Email: info@cceramics.com Phone: 646-626-4172 Email: david.rudnick@ccgir.com SEC Attorney Loeb & Loeb Grant Thornton PRC Mitchell Nussbaum, Partner Tel: (86) 21 2322 0200 Tel: (1) 212 407 4159 Email: