De.mem Ltd. · ASX:DEM
De.mem — Investor Presentation (May 2020)
19 slides from De.mem's investor presentation, May 12, 2020
Slide 1: De.mem Investor Presentation
ASX RELEASE | De.mem Limited (ASX:DEM) De.mem Investor Presentation 12 May 2020: Australian-Singaporean water and waste water treatment company De.mem (ASX:DEM) (“De.mem” or “the Company”) encloses hereto an Investor Presentation for release to the market. This announcement has been authorised by th
Slide 2: De.mem Limited (ASX:DEM) Investor Presentation
De.mem Limited (ASX:DEM) Investor Presentation March Quarter 2020 12 May 2020
Slide 3: Contents
CONTENTS 3 BUSINESS OVERVIEW 4 CORPORATE SNAPSHOT 5 MILESTONE PROJECTS 6 UNIQUE TECHNOLOGY PORTFOLIO 7 BLUE CHIP CUSTOMER BASE 8 STRONG CUSTOMER VALUE PROPOSITION 10 FINANCIAL SUMMARY 11 GROWING RECURRING REVENUES 12 CY19-20 KEY MILESTONES 13 FY20 OUTLOOK 15 RELATIVE VALUATION DISCOUNT 16 KEY INVEST
Slide 4: Business Overview
BUSINESS OVERVIEW 3 De.mem provides decentralized industrial water treatment solutions including a world-leading water membrane technology, to clients ranging from mining, infrastructure and food & beverage segments Products include water treatment equipment and consumables sales (pumps, filters, me
Slide 5: Corporate Snapshot
CORPORATE SNAPSHOT 4 Since July 2019. DEM has consistently outperformed the ASX Small Industrials index ASX code DEM NA Singapore Early-Stage Venture Fund 24.0% Ordinary shares 177.8m MAJOR SHAREHOLDERS Market capitalisation $32m Perennial Value Microcap Opportunities Fund 14.2% Cash on hand (31.12.
Slide 6: FY19 Milestone Projects
FY19 MILESTONE PROJECTS 5 Breakthrough Project Awards in FY19 – providing a strong foundation for follow-on work • Client is Mulpha, an international infrastructure investor with a number of assets in Australia • Total value of project is approx. A$3m • Desalination plant based on a Sea Water Revers
Slide 7: Unique Technology Portfolio
UNIQUE TECHNOLOGY PORTFOLIO 6 De.mem proprietary product portfolio includes breakthrough membrane innovations COMPLETED (2018 and 2019) PLANNED (2020 FF) • Nanofiltration membrane • Membrane Bioreactor (MBR) – Superior filtration performance due to minimum – Treatment of high organic load waste wate
Slide 8: Blue Chip Customer Base
BLUE CHIP CUSTOMER BASE 7 DEM has large, blue-chip clients that often provide repeat orders across their global operations Customers include global mining companies, large EPC contractors, municipalities, water utilities and multinational corporations Mining Municipal / Infrastructure Food & Beverag
Slide 9: Strong Customer Value Proposition – One Stop Shop
STRONG CUSTOMER VALUE PROPOSITION – “ONE STOP SHOP” 8 “One-stop-shop” industrial water treatment solutions provider • Diversified product range - supplies all major types of water and waste-water treatment equipment • Patented and proprietary technology - Partnership in R&D with Nanyang Technologica
Slide 10: Strong Customer Value Proposition – One Stop Shop
STRONG CUSTOMER VALUE PROPOSITION – “ONE STOP SHOP” 9 Recurring revenues include BOO, O&M and Consumables Sales In March Quarter 2020, recurring revenues comprised ~66% total revenues Equipment Build-Own-Operate Operations Consumables Sales or Build-Own-Transfer and Maintenance Sales •Sale of water
Slide 11: FY19 Financial Summary
FY19 FINANCIAL SUMMARY 10 DEM increased cash receipts by 15% to $11.7m in FY19 DEM is growing its recurring revenue base and has a visible path to sustainable operating cash positive STRONG CASHFLOWS A$M (Dec yr end) 2016 2017 2018 2019 • Strong cashflow momentum, with record H2 CY 2019 cash inflows
Slide 12: Growing Recurring Revenues
GROWING RECURRING REVENUES 11 Recurring revenues are expected to continue growing through FY20 Recurring revenues increased from 38% in FY18 to 66% in March Quarter 2020. FY20F total cash receipts guidance of $14-18m is supported by strong recurring revenues • Recurring revenue increased from 38% of
Slide 13: CY19-20 Key Milestones
CY19-20 KEY MILESTONES 12 Positive structural changes include the shift to recurring revenues and “one stop shop” business model Other milestones include acquisition integration value-add, marquee clients and balance sheet recapitalisation Developed strong recurring revenue base for FY20 – Approx. ~
Slide 14: FY20 Outlook - Growing Recurring Revenues
FY20 OUTLOOK - GROWING RECURRING REVENUES 13 FY20 is on track for best annual revenues on record FY20F has a minimum visible revenue base of $10.4m, with equipment sales to further add to FY20F total revenue. + Add equipment sales (amount to be determined) $1.4m contracted revenues carried over from
Slide 15: FY20 Outlook
FY20 OUTLOOK 14 Ongoing top line growth • On track for record revenues in CY20 • FY20F cash receipts/revenue guidance of $14-18m, driven by ~$9m of recurring revenues and $1.4m FY19 contract rollover, with $3.3m cash receipts in March Qtr 2020 (seasonally weakest quarter) • Visible path to sustainab
Slide 16: Relative Valuation Discount
RELATIVE VALUATION DISCOUNT 15 DEM’s valuation discount to its peers is reducing DEM currently trades at 2.7x Market Capitalisation/Revenue (x), which is ~72% discount to its ASX-listed peer average. The relative value discount has reduced from ~87% on 30 August 2019 Company Last 12 Months Market Ma
Slide 17: Key Investment Considerations
KEY INVESTMENT CONSIDERATIONS 16 Uniquely positioned to become the leading player in decentralized water treatment across APAC, providing a “one stop shop” of industrial water treatment products and services. The recent structural shift to recurring revenues underpins a strong revenue outlook, as ev
Slide 18: Legal Disclaimer
LEGAL DISCLAIMER 17 This presentation has been prepared by De.mem Limited and its related entities (the “Company”). It does not purport to contain all the information that a prospective investor may require in connection with any potential investment in the Company. You should not treat the contents
Slide 19: De.mem Limited (ASX:DEM)
DE.MEM LIMITED (ASX:DEM) Andreas Kroell Chief Executive Officer De.mem Limited investor@demem.com.sg INVESTOR ENQUIRIES George Gabriel, CFA Managing Director BLETCHLEY Park Capital investors@bletchleyparkcapital.com.au (03) 8686 9144