Energy Resources Of Australia Ltd. Class A · ASX:ERA
Energy Resources Of Australia Ltd. Class A — Investor Presentation (August 2024)
42 slides from Energy Resources Of Australia Ltd. Class A's investor presentation, Aug 29, 2024
Slide 1: Capital Raising Presentation (for Entitlement Offer)
Capital Raising Presentation (for Entitlement Offer) 29 August 2024 1
Slide 2: Important notices
Important notices This presentation has been prepared by Energy Resources of Australia Ltd ABN 71 008 550 865 (ERA or the The Entitlement Offer is being extended to New Zealand shareholders in reliance on the Financial Markets Conduct Company) in connection with a non-underwritten pro rata renouncea
Slide 3: Important notices
Important notices Forward-looking statements: This presentation contains certain forward-looking statements , which includes statements of current intention, statements of opinion and predictions as to possible future events. Forward- looking statements can generally be identified by the use of forw
Slide 4: Acknowledgement of Traditional Owners
Acknowledgement of Traditional Owners The operations of Energy Resources of Australia Ltd (ERA) are located on Aboriginal land and are surrounded by, but separate from, Kakadu National Park. ERA respectfully acknowledges the Mirarr people who are the Traditional Owners of the land on which Ranger mi
Slide 5: Executive summary
Executive summary 5
Slide 6: Executive summary | Market Soundings
1 Executive summary | Market Soundings • As announced on 26 August 2024, ERA launched an investor sounding process to determine interest in an equity raise to fund rehabilitation activities (Market Soundings) • The Independent Board Committee of ERA (IBC) has considered all reasonably available opti
Slide 7: Executive summary | Equity Raise
2 Executive summary | Equity Raise • The IBC has sized and priced the equity raise based on ERA’s funding requirements and feedback received during the Market Soundings, and binding pre-commitments received • ERA today launches a pro rata renounceable entitlement offer of new fully paid ordinary sha
Slide 8: Executive summary | Shareholder participation and intentions
3 Executive summary | Shareholder participation and intentions • The Pre-Committed Shareholder has committed to subscribe for $760m in total • Rio Tinto’s voting power could increase to up to 99.2% in ERA following completion of the Entitlement Offer taking into account the binding pre-commitments a
Slide 9: Executive summary | Timing and alternative funding options considered by IBC
Executive summary | Timing and alternative funding options 4 considered by IBC Timing • Careful consideration was given by the IBC to the overall timing of the Entitlement Offer, particularly given the ongoing Court proceedings regarding Jabiluka and the uncertainty that this has created for shareho
Slide 10: Executive summary | Timing and alternative funding options considered by IBC cont'd
Executive summary | Timing and alternative funding options 4 considered by IBC cont’d • The alternatives included: – Commencing in April 2024, the IBC tested the interest of both potential underwriters and potential strategic investors to determine interest in underwriting a potential capital raise
Slide 11: Business update
Business update 11
Slide 12: Rehabilitation commitment
Rehabilitation commitment • ERA’s strategic priority continues to be the comprehensive rehabilitation of the Ranger Project Area in accordance with its obligations so that it can be incorporated into the surrounding Kakadu National Park if the Mirarr Traditional Owners wish • On conclusion of the En
Slide 13: ERA's liquidity position
ERA's liquidity position • ERA’s liquidity position as at 30 June 2024 is as follows: – Approximately $128m of available cash – Zero debt – $126m of bank guarantees – $125m in bank guarantees are held by the Commonwealth as additional security for ERA's Ranger rehabilitation obligations – $1m in ban
Slide 14: Jabiluka update
Jabiluka update • As announced on 26 July 2024, the Northern Territory Minister for Mining and Minister for Agribusiness and Fisheries (NT Minister) advised ERA that MLN1 will not be renewed based on advice from the Commonwealth Minister for Resources and Minister for Northern Australia (Commonwealt
Slide 15: Details of the Entitlement Offer
Details of the Entitlement Offer 15
Slide 16: Overview of the Entitlement Offer
Overview of the Entitlement Offer • The IBC determined that the most equitable form for this equity raise is a traditional, pro-rata, renounceable entitlement offer, with a rights trading period and shortfall bookbuild • 19.87 for 1 pro rata renounceable entitlement offer to raise up to approximatel
Slide 17: Overview of the Entitlement Offer cont'd
Overview of the Entitlement Offer cont'd • Eligible Shareholders (as described in Slide 2), other than Rio Tinto, who take up their entitlement in full may also apply for additional New Shares (Additional New Shares) at the Offer Price in excess of their entitlement under the shortfall facility (Sho
Slide 18: Overview of the Entitlement Offer cont'd
Overview of the Entitlement Offer cont'd • In accordance with ASX Listing Rule 10.11, Rio Tinto will not be able to apply for Additional New Shares under the Rio Tinto will not Shortfall Facility to bid to acquire entitlements pursuant to or the Shortfall Bookbuild without the approval of ERA be iss
Slide 19: Rio Tinto Voting Power
Rio Tinto Voting Power • Rio Tinto’s voting power could increase to up to 99.2% in ERA following completion of the Entitlement Offer taking into account the binding pre-commitments and assuming no other shareholders (other than those who have pre-committed) participate and Shortfall Entitlements and
Slide 20: Rio Tinto Intention Statement
Rio Tinto Intention Statement • If Rio Tinto acquires Shares under the Offer which, when aggregated with its existing holdings, result in Rio Tinto holding 90% or more of the shares in ERA, then Rio Tinto intends to proceed with compulsory acquisition of all remaining ERA shares under Part 6A.2 of t
Slide 21: Sources and uses of funds from 1 July 2024 up until approximately Q3 2027
Sources and uses of funds from 1 July 2024 up until approximately Q3 2027 Sources Amount Uses Amount Committed net proceeds of the Entitlement Offer Expected rehabilitation expenditure 1/7/24 to approximately (Includes pre-commitments from the Pre-committed Shareholders, and $753m $846m Q3 2027 on t
Slide 22: Entitlement Offer timetable
Entitlement Offer timetable 22
Slide 23: Entitlement Offer timetable
Entitlement Offer timetable Event Date Announcement of Entitlement Offer (including Investor Presentation) Thursday, 29 August 2024 ASX release of Offer Information Booklet, Cleansing Statement and Appendix 3B Thursday, 29 August 2024 Ex-date Monday, 2 September 2024 Entitlement trading on ASX begin
Slide 24: Key risks
Key risks 24
Slide 25: Key risks
Key risks Introduction and its financial position and performance. A number of risks and uncertainties, which are both specific to ERA and of a more general nature, At 30 June 2024, the ERA rehabilitation provision is $2,402 million(1), a decrease of $18 million from may affect the future operating
Slide 26: Key risks
Key risks It is anticipated that under the current and any revised Mine Closure Plans there may be schedule September 2023 quarter. The Office of the Supervising Scientist have completed their assessment overruns (caused by a number of factors including complexities in technical risk management, and
Slide 27: Key risks
Key risks ERA has agreed amendments to the Ranger Uranium Project Government Agreement with the mining to tourism. If future licence extensions are not granted, ERA would not be able to effectively Commonwealth to introduce a clearer framework for managing the amount of security held by the undertak
Slide 28: Key risks
Key risks • the release, spillage and impact on the surrounding environment of hazardous materials such provider which may result in uncertainty as to the cost of and timeline for the project and in anticipated cost savings not being realised which may have impact on ERA's financial position and as
Slide 29: Key risks
Key risks Provided that ERA has complied with all of its obligations under the Jabiluka Mineral Lease and the 2.3 Valuation of Jabiluka Mining Act 1980 (NT) which has now been repealed and replaced with the Mineral Titles Act 2010 (NT) (together, the Mining Act), the Jabiluka Mineral Lease provides
Slide 30: Key risks
Key risks Nor is there any guarantee that ERA will be able to secure or maintain title to ERA’s exploration price movements with certainty. and mining tenements. In particular, ERA’s right to operate at the Ranger Project Area expired in January 2021 and it is not permitted to renew this right for a
Slide 31: Key risks
Key risks Activities post-2027 and estimates of their costs remain highly uncertain. These activities remain There can be no guarantee that the price at which Rio Tinto would acquire the remaining ERA subject to a number of studies and are also potentially sensitive to external events. As such, shar
Slide 32: Key risks
Key risks The tax consequences of selling or transferring entitlements or of doing nothing may be different. outlined in this presentation in a timely and cost effective manner, as well as adversely impact Before selling or transferring entitlements, Eligible Shareholders should seek independent tax
Slide 33: Key risks
Key risks Furthermore, resource estimates are likely to change over time as new information becomes • Other Issues (including format and structure) available or as regulatory requirements change. Should ERA encounter mineralisation or geological formations different from those predicted by past dril
Slide 34: Key risks
Key risks 3.13 Regulators and stakeholders In relation to Ranger 3 Deeps, ERA has ceased to be authorised to conduct mining and processing activities in the Ranger Project Area. Accordingly, development of Ranger 3 Deeps is not an Uranium mining in the Northern Territory is regulated through a suite
Slide 35: Key risks
Key risks 3.16 Occupational health & safety royalty policies, or in the interpretation or application of such policies. ERA's mining rehabilitation activities may expose its staff and contractors to potentially dangerous ERA had approximately $343 million in tax losses (at 30% per cent) as at 30 Jun
Slide 36: Key risks
Key risks 3.21 Risks relating to equity investments and markets Investors should be aware that there are risks associated with any investment in a company listed on ASX. The value of ERA shares may rise above or fall below the Offer Price, depending on the business, financial position and performanc
Slide 37: Selling restrictions / jurisdictions
Selling restrictions / jurisdictions International Offer Restrictions This document does not constitute an offer of new ordinary shares (New Shares) of the Company in any jurisdiction in which it would be unlawful. New Shares may not be offered or sold in any country outside Australia except to the
Slide 38: Selling restrictions / jurisdictions cont'd
Selling restrictions / jurisdictions cont’d Singapore This presentation has not been registered as a prospectus with the Monetary Authority of Singapore and the New Shares will be offered pursuant to one or more exemptions under the Securities and Futures Act 2001 of Singapore (the SFA). Accordingly
Slide 39: Selling restrictions / jurisdictions cont'd
Selling restrictions / jurisdictions cont’d Hong Kong WARNING: This document has not been, and will not be, registered as a prospectus under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong, nor has it been authorised by the Securities and Futures Commission i
Slide 40: Rio Tinto Intention Statement
Rio Tinto Intention Statement Background Given Rio Tinto's current shareholding in ERA and the potential for its relevant interest to increase from 86.3% to up to approximately 99.2% as a result of Rio Tinto's participation in the proposed Entitlement Offer (depending on the extent of participation
Slide 41: Rio Tinto Intention Statement cont'd
Rio Tinto Intention Statement cont’d On 24 November 2022, Parliament passed amendments to the Atomic Energy Act 1953 (Cth) allowing additional time for ERA to complete the rehabilitation of the Ranger Project Area, including long term monitoring and maintenance. ERA is continuing to work to progress
Slide 42: Rio Tinto Intention Statement cont'd
Rio Tinto Intention Statement cont’d Rio Tinto notes that the ERA IBC is deciding on the most appropriate course of action for ERA in response to the Jabiluka lease renewal decision and has lodged an application for judicial review of the decision. The ERA IBC’s independent role in determining this
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