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Amg Critical Materials — AMG Advanced Metallurgical Group — Debt Investor Presentation (2019)
18 slides from Amg Critical Materials's debt investor presentation, 2019
Slide 1: Ohio Air Quality Development Authority Exempt Facilities Revenue Bonds (AMG Vanadium Project)
$307,200,000 OHIO AIR QUALITY DEVELOPMENT AUTHORITY STATE OF OHIO EXEMPT FACILITIES REVENUE BONDS (AMG VANADIUM PROJECT) SERIES 2019 AMG ADVANCED METALLURGICAL GROUP N.V.
Slide 2: Company Disclaimer
COMPANY DISCLAIMER THIS DOCUMENT CONTAINS PROPRIETARY INFORMATION AND IS BEING PROVIDED SOLELY FOR INFORMATION PURPOSES BY AMG ADVANCED METALLURGICAL GROUP N.V. (THE “COMPANY”) AND MAY NOT BE REPRODUCED IN ANY FORM OR FURTHER DISTRIBUTED TO ANY OTHER PERSON OR PUBLISHED, IN WHOLE OR IN PART, FOR ANY
Slide 3: AMG Overview
AMG OVERVIEW
Slide 4: AMG at a Glance
AMG AT A GLANCE WHAT AMG DOES AMG CORE PRINCIPLES • Expert global value chain manager in sourcing critical • Leading producer in all our markets materials from complex locations, providing value-add • Low-cost producer in all our markets processing, and serving Fortune 100 customers • Innovation dri
Slide 5: AMG Business Segments
AMG BUSINESS SEGMENTS AMG AMG CRITICAL MATERIALS TECHNOLOGIES AMG’s conversion, mining, AMG’s titanium alloys, vacuum and recycling businesses systems and services business • Spent Catalyst Recycling (Vanadium) • Titanium Alloys & Coatings • Superalloys (Chrome) • Furnaces • Aluminum (Master Alloys)
Slide 6: AMG Is a Leader in CO2 Reduction
AMG IS A LEADER IN CO2 REDUCTION AMG: ENABLING TECHNOLOGIES AMG: MITIGATING TECHNOLOGIES Products and processes saving CO2 Products and processes saving raw emissions during use: materials, energy and CO2 emissions during • Aerospace Engine Fuel Efficiency manufacturing: • Ferrovanadium Recycling •
Slide 7: AMG Strategic Development Timeline
AMG STRATEGIC DEVELOPMENT TIMELINE PORTFOLIO CREATION PRODUCT MIX FOCUSED ON & INTEGRATION OPTIMIZATION ORGANIC GROWTH Acquisition of family-run Streamlined operations Properly positioned, financially and businesses benefiting and improved operating performance operationally, to pursue growth target
Slide 8: Cambridge II Project
CAMBRIDGE I ) PROJEGT .
Slide 9: Cambridge II Project Rendering
CAMBRIDGE II PROJECT RENDERING 9
Slide 10: Low Risk Cambridge II Project Increases Scope and Scale
LOW RISK CAMBRIDGE II PROJECT INCREASES SCOPE AND SCALE THE • Double AMG’s spent catalyst recycling capacity in order to take advantage of OPPORTUNITY the closure of a competitor and service the North American refining industry SUPPLIER • Refineries are better off recycling their resid catalysts wit
Slide 11: Existing Cambridge, Ohio Recycling Facility: Operational Since 1952
EXISTING CAMBRIDGE, OHIO RECYCLING FACILITY: OPERATIONAL SINCE 1952 11
Slide 12: What Is Vanadium?
WHAT IS VANADIUM? Vanadium Production Vanadium Consumption HOW IS VANADIUM PRODUCED? Total 2018 Production = ~89k MT Total 2018 Consumption = ~97k MT Chemicals • Vanadium is present in the Earth’s Energy Storage Recycling crust and is produced either from 17% Aerospace 4% 3% processing iron ore or c
Slide 13: AMG Vanadium Products
AMG VANADIUM PRODUCTS • The majority of profitability is associated with Ferrovanadium and Ferronickel-molybdenum • The sale of Revan™ and LimeAdd™ allow AMG Vanadium to avoid landfilling costs PRODUCTS VALUE PROPOSITION APPLICATIONS • High strength low alloy (HSLA) steel used for construction, ship
Slide 14: AMG Spent Catalyst Value Chain – A Cradle-to-Grave Solution
AMG SPENT CATALYST VALUE CHAIN – A “CRADLE-TO-GRAVE” SOLUTION • AMG Vanadium processes spent catalyst in a roasting facility in order to remove the sulfur • The roasted catalyst is then melted in an electric arc furnace (EAF) where the Ferronickel-molybdenum is extracted • The molten material is pas
Slide 15: Spent Catalyst Contract Structure
SPENT CATALYST CONTRACT STRUCTURE Spent Catalyst Ferrovanadium Refinery Tipping Fee FeNiMoly % of sales price • Because of the income the refineries receive from the sale of finished products, utilizing AMG is the cheapest and most environmentally-sound way to dispose of their hazardous spent cataly
Slide 16: Vanadium Market Dynamics – Supply and Demand Drivers
VANADIUM MARKET DYNAMICS – SUPPLY AND DEMAND DRIVERS Demand Supply CHINESE REBAR FACILITY STEEL CHINA BARRIERS TO ENTRY STANDARD CLOSURES • Steel production • The Grade 3 • Beginning in 2017, China • During 2015/16, South • There are no new accounted for 88% rebar standard in banned imports of Afric
Slide 17: Vanadium: Inventory vs. FeV Price
VANADIUM: INVENTORY VS. FEV PRICE Sep 2008: Lack of 2004: Introduction of Nov 2018: Revised electrical power in South Grade 3 rebar standard in standards for Chinese Africa negatively impacts China vanadium production Vanadium rebar enacted 9 Inventory $70 8 2015: Chinese rebar $60 7 producers switc
Slide 18: Projected Vanadium Supply Deficit
PROJECTED VANADIUM SUPPLY DEFICIT 120,000 111,533 109,790 Uncertain MT Vanadium High Cost 103,987 Production 105,000 99,054 96,870 104,790 Supply Demand 89,355 90,000 75,000 2018 2019E 2020E 7,500 MT 5,000 MT 1,700 MT deficit deficit deficit Ongoing market deficit expected for the next several years
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