Magontec Limited · ASX:MGL
Magontec — Investor Presentation (November 2016)
21 slides from Magontec's investor presentation, Nov 15, 2016
Slide 1: Magontec Limited 4Q 2016
For personal use only Magontec Bottrop Magontec Romania Magontec Limited Nicholas Andrews (ASX: MGL) Executive Chairman 4Q 2016
Slide 2: Disclaimer
DISCLAIMER This Presentation has been prepared by Magontec Limited (ABN 30 147 131 977) (Magontec or the Company). This Presentation contains summary information about Magontec and its activities current as at the date of this Presentation. The information in this Presentation is of a general backgr
Slide 3: MGL – Overview: Why magnesium?
MGL – Overview Why magnesium? For personal use only Magnesium alloy is a light and strong structural metal Lower density Aluminium 2.70g/cm3 Mg 36% lighter Mg Iron 7.87g/cm3 Mg 78% lighter Magnesium 1.74g/cm3 Fe Al Research focus New magnesium applications Stress resistance Automotive Thermal conduc
Slide 4: MGL – Overview
MGL – Overview Global magnesium alloy manufacturing and recycling company Magnesium anode manufacturing For personal use only EUROPE CHINA New project - QINGHAI Marketing office Marketing agency Market capitalisation: A$45m Shareholder base Qinghai Salt Lake Magnesium Co Ltd (29%) HO & ASX listing (
Slide 5: Magnesium alloy manufacturing
MGL – Overview Magnesium alloy manufacturing For personal use only Raw material Inputs Production of Mg alloy ingots Pure Mg Mg scrap 40 – 70% scrap Die cast manufacturer (customer) Automotive Powertool End user industries Electronics Other
Slide 6: Magnesium anode manufacturing
MGL – Overview Magnesium anode manufacturing For personal use only Raw material Inputs Magontec Mg anode cast / extrusion process Mg alloy / scrap Global water heater industry
Slide 7: Magontec Qinghai
Magontec Qinghai In 2013 Magontec announced a new project in Qinghai For personal use only Agreement between Qinghai & Magontec Qinghai Salt Lake Magnesium Co Ltd Magontec Qinghai Co Ltd 100,000 mtpa electrolytic Mg smelter 60,000 mtpa Mg alloy cast house Proven technology from Norsk Hydro Receives
Slide 8: Magontec Qinghai
Magontec Qinghai Dehydration units 1 & 2 Electrolytic cell house Cast house For personal use only The first new electrolytic magnesium plant constructed in 16 years Hot commissioning under way Production expected 4Q 2016 / 1Q 2017
Slide 9: Magontec Qinghai: World's largest electrolytic Mg alloy supplier
Magontec Qinghai Qinghai will make Magontec the World’s largest supplier For personal use only of electrolytic Mg alloy ~10% Mg alloy market share Target > 20% Mg alloy market 2015 share after Magontec Qinghai RoW 234,500 mt Magontec Magontec 59,000 mt 25,500 mt RoW Low CO2 electrolytic Largely high
Slide 10: Magontec Qinghai: lowest CO2 Mg ever produced
Magontec Qinghai Magontec Qinghai will use the lowest CO2 Mg ever produced* For personal use only 45 Magontec Qinghai 40 35 kg CO2eq / kg Mg 30 incl. use incl. credits for use of SF6 of waste gas w/o credit for 25 CO2 uptake incl.credits for 20 by-products 15 incl.credits for by-products 10 5 0 Golm
Slide 11: Magnesium alloy demand – global automotive volumes
Magnesium Industry Magnesium alloy demand – key drivers For personal use only 1. Global automotive volumes annual production volumes 89m in 2015 and estimated at 90m in 2016 9% 4% 5% Analysts anticipate steady growth over the next two years -10% 22.3 mill 17.4 mill 14.9 mill 4.9 mill China USA W Eur
Slide 12: Magnesium alloy demand – automotive CO2 emissions reduction
Magnesium Industry Magnesium alloy demand – key drivers For personal use only 2. Automotive CO2 emissions reduction 2020 EU target average fleet emission of 95g CO2 per km
Slide 13: Magnesium alloy demand – light weight applications
Magnesium Industry Magnesium alloy demand – key drivers For personal use only Light weight new magnesium applications Magontec proprietary Mg alloy Application Alloy Weight save Porsche Valve cover AE44 45% Audi Transmission housing AE44-2 31% German co Small engine components AE44-2 - Chinese co
Slide 14: Magnesium alloy demand – thermal conductivity
Magnesium Industry Magnesium alloy demand – key drivers 3. Thermal conductivity Magontec ‘AE' family alloys finding new applications use only Magontec magnesium alloys Aluminium benchmark alloy For personal W/(mK) ADC12 AZ91D AM60B AM50A AJ62 AS21 MMA-001 MMA-003 MA-005 MMA-006
Slide 15: New opportunities for heat dissipation applications
Magnesium Industry New opportunities for applications seeking heat dissipation For personal use only Tele-com applications Solar inverters LED lights Electric vehicles Electronic applications
Slide 16: Cathodic Corrosion Protection CCP
Cathodic Corrosion Protection CCP Magnesium and electronic anodes – “cathodic corrosion protection” For personal use only Mg Anode volumes 2,029 mt Worlds largest Mg anode manufacturer 1,800 mt Urbanisation (water heaters) Replacement (5 to 10 years) 1,200 mt 1,000 mt 850 mt Focus 550 mt Production
Slide 17: First Half – June 2016: Cash Flow
First Half – 30 June 2016 Cash Flow For personal use only A$4.8 million cash flow from underlying operations over the last 12 months Funding for future working capital requirements No significant capex requirements going forward $2.40 $2.40 A$m $1.20 $1.20 ($0.60) 1H14 2H14 1H15 2H15 1H16
Slide 18: First Half – June 2016: Gross Profit & Margin
First Half – 30 June 2016 Gross Profit & Gross Profit Margin For personal use only Improvement in Gross Profit across the business 11.2% 9.8% 8.2% 8.7% 6.4% 6.3% 5.1% A$m $5.0 $3.4 $4.3 $4.2 $5.9 $7.0 $7.4 1H13 2H13 1H14 2H14 1H15 2H15 1H16
Slide 19: 1H 2016 - Profit & Loss
First Half – 30 June 2016 1H 2016 - Profit & Loss For personal use only 1H16 1H15 % Change $ Change EBITDA $1,917,174 $1,212,842 58% + $704,332 Depreciation & amortisation ($863,419) ($809,447) 7% ($53,972) EBIT $1,053,755 $403,394 161% + $650,361 Interest expense ($622,224) ($648,066) -4% $25,842 P
Slide 20: Summary
Summary For personal use only Mg alloy production volumes to triple ✔ Margin improvement in all products ✔ “Green” magnesium ✔ Improving financial fundamentals ✔ Profit “inflexion” point ✔
Slide 21: Thank you for your time
Thank you for your time For personal use only MAGONTEC Group MAGONTEC MAGONTEC GmbH MAGONTEC Xian Co., Ltd Head Office, Sydney Industriestraße 61 No. 40, Feng Cheng 3 Road, Suite 1.03 46a Macleay St 46240 Bottrop Xian Economic and Technological Potts Point Sydney NSW 2011 Germany Development Zone AU