Wa Kaolin Limited · ASX:WAK
Wa Kaolin — Investor Presentation (May 2024)
27 slides from Wa Kaolin's investor presentation, May 1, 2024
Slide 1: Equity Raising Presentation
Equity Raising Presentation • World-class Resource • Multi-generational Life of Mine • Engineering solutions being implemented to improve output and yield for fine particle size April 2024
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer This presentation has been prepared by WA Kaolin Ltd (WAK). This document contains background otherwise and do not make any representation or warranty, express or implied, as to the currency, accuracy, information about WAK current at the date of this presentation. Th
Slide 3: Table of Contents
Table of Contents Slide 4 Overview The Status, The Problem, The Engineering Solution, The Capital Required, The Placement, The Path to Positive Operating Cash Flow Slide 5 Corporate Snapshot Slide 6 Current Operational Status Slide 7 Operational Challenge Slide 8 The Engineering Solution Slide 9 Cus
Slide 4: Overview
Overview • Status • Plant operating reliably at nameplate for coarse grades of kaolin. Sales growing steadily • The Problem • Finer products than originally specified required for fibreglass • Plant is unable to reach nameplate capacity for finer products without high wastage • The Engineering Solut
Slide 5: Corporate Snapshot
Corporate Snapshot Corporate Structure at 31 March 2024 Board & Management John White Non-Executive Chairman SHARES ON ISSUE 423,784,121 Alf Baker Managing Director MARKET CAPITALISATION Ken Hall Non-Executive Director $17.8m @ 4.2c PER SHARE Sean Hu1 Non-Executive Director UNLISTED OPTIONS1 36,250,
Slide 6: Current Operational Status
Current Operational Status • Plant was commissioned October 2022 and all operating licenses granted • Plant is running continuously now for 4-5 days per week. Following annual shutdown maintenance in Dec 2023/Jan 2024, the plant reliability has improved to circa 90% • Production rate is 25tph namepl
Slide 7: Operational Challenge
Operational Challenge • The commercial plant at Wickepin was designed and constructed based on the pilot facility in Kwinana with two stage classification – Stage 1 to remove coarse sand and stage 2 to remove the finer sand • After construction of the commercial plant, a key market sector tightened
Slide 8: The Engineering Solution
The Engineering Solution • Research resulted in several classifier equipment suppliers being identified in Europe, Asia and USA and several tonnes were sent for trials at pilot facilities. WAK technical management, Alf Baker and Nathan Allbut, attended the trials and were very satisfied with equipme
Slide 9: Customer Relationships and Kaolin Pricing
Customer Relationships and Kaolin Pricing Offtake Partners • Stanco International Corp In August 2023 WAK signed an expanded offtake agreement with Stanco. The original 2020 agreement had supply totalling 338,000 tonnes over 6 years, however the new agreement aims to bolster that by targeting additi
Slide 10: The Path to Positive Operating Cash Flow
The Path to Positive Operating Cash Flow 1. The Engineering Solution The first key is the installation and commissioning of the new US-sourced classifiers, overseen by experienced independent engineering advisors. This will allow the plant to reach nameplate capacity of the finer grades at 25ktpa 2.
Slide 11: Equity Raise Details
Equity Raise Details • WA Kaolin is seeking to raise A$6.5 million via a non-underwritten two-tranche share placement to issue 108.3 million new fully paid ordinary shares (“New Shares”) in the Company, at an offer price of A$0.06 per New Share (“Offer Price”) (“Placement”). • Tranche One of the Pla
Slide 12: Indicative Timetable & Pro-Forma Capital Structure
Indicative Timetable & Pro-Forma Capital Structure Indicative Timetable Date Pre-Market, Monday, 29 April Trading halt 2024 Pro-Forma Capital Structure Shares Options Funds Raised Trading halt lifted – trading resumed on Wednesday, 1 May 2024 Securities currently on issue1 423,784,121 35,500,000 the
Slide 13: Sources and Uses of Funds
Sources and Uses of Funds Engineering solution ($3.0m) • Purchase of classifiers from the USA • Ancillary equipment, engineering, structural, electrical and commissioning costs Working Capital and Existing Cash ($5.4m) • Pending the installation and commissioning of the new equipment, it is not poss
Slide 14: Pro-Forma Balance Sheet
Pro-Forma Balance Sheet Borrowings – • The majority of Company debt is unsecured and with its Founders and related parties: Proforma $6.5m Balance Sheet (A$m)* At 31 March 2024 Raise • Wamco Industries Pty Ltd and SMA Management Associates Pty Ltd approx. $22m – approximately 60% of loans are intere
Slide 15: Conclusion
Conclusion • World class kaolin reserve/resources and established operating infrastructure, positioning to be the leading kaolin supplier into Asia • Plant not designed for new finer kaolin particle size specification for fiberglass, resulting in limited production and excessive wastage • Engineerin
Slide 16: Appendices
Appendices 16 Investor Presentation | April 2024
Slide 17: Market Overview and Customers
Market Overview and Customers Market Overview • The global Kaolin market is expected to grow from US$3.98 billion in 2024 to US$5.22 billion in 20301. Asia Pacific accounted for the largest revenue share of more than 47.0% in 20231. Economic development and rapid industrialization have stimulated gr
Slide 18: Market Opportunities
Market Opportunities Asian Kaolin market outlook • Asian Kaolin consumption is expected to rise significantly over the next decade, mainly driven by increased demand from the fibreglass, ceramics and paper sectors • Kaolin demand has historically been correlated with GDP growth, and as Asian GDP ris
Slide 19: Definitive Feasibility Study recap
Definitive Feasibility Study recap • A Definite Feasibility Study (DFS) was developed by BDB Process Pty Ltd in September 2020 and released to the market when the Company listed in November 2020 1 • The Board considers the material assumptions underpinning the DFS have not materially changed other t
Slide 20: Wickepin Kaolin Resources
Wickepin Kaolin Resources World Class Deposit • Discovered by Rio Tinto in 1980’s (acquired by WA Kaolin in 1999) • Ore Reserve: 64.9mt1 of ultra bright, high purity kaolinised granite • Mineral Resource: 643.0mt2 of ultra bright, high purity kaolinised granite (includes ore reserve) • The mineralis
Slide 21: Updated ORE and MRE
Updated ORE and MRE Table 1. Ore Reserves by JORC Classification • Wickepin Project Ore Reserve Estimate and Mineral JORC Classification TONNES ISO BRIGHTNESS YIELD (%) IN SITU KAOLIN Resource Estimate updated by CSA Global (Mt) (%) (<45 µM IN SIZE) (MT) • Ore Reserve Estimate updated from 30.5Mt to
Slide 22: Tenement Map
Tenement Map 22 Investor Presentation | April 2024
Slide 23: Risks
Risks A key factor for WAK is the price of kaolin. Kaolin prices fluctuate due to a variety of factors including supply and demand fundamentals, international economic and political trends, expectations of inflation, currency exchange rate fluctuations, interest rates, global or regional consumption
Slide 24: Risks
Risks WAK is currently negotiating offtake agreements for its intended expanded production. WAK has customers in place for current production and LOI’s for a certain quantity of the intended expanded production. However, there is a risk that WAK may not secure offtake agreements in respect of any, o
Slide 25: Risks
Risks The agreements entered into by WAK with its current customers / distributors outside Australia are in USD. Demand and supply of capital and currencies, forward USD : AUD Exchange Rate trading activities, relative interest rates and exchange rates and relative economic conditions can impact for
Slide 26: International Offer Restrictions
International Offer Restrictions This document does not constitute an offer of new ordinary shares (“New Shares”) or free-attaching options (“New Options”) of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and such se
Slide 27: Contact Us
Contact Us www.wakaolin.com.au Alf Baker| Managing Director +61 419 314 283 abaker@wakaolin.com.au Andrew Sorensen | Director Sales & Marketing +61 418 338 488 asorensen@wakaolin.com.au