Lynas Rare Earths Limited · ASX:LYC
Lynas Rare Earths — Lynas — Shareholder Meeting (November 2015)
23 slides from Lynas Rare Earths's shareholder meeting presentation, Nov 23, 2015
Slide 1: Annual General Meeting 23 November 2015
For personal use only Lynas Corporation Ltd Annual General Meeting 23 November 2015 1
Slide 2: Disclaimer
Disclaimer For personal use only This Presentation has been prepared by Lynas Corporation Limited (ABN 27 009 066 648) (Lynas or the Company) This Presentation contains summary information about Lynas and its subsidiaries (Lynas Group) and their activities current as at the date of this Presentation
Slide 3: Today
Today For personal use only • Performance in FY15 • Focus on Mt Weld • Market developments • FY16 Priorities 3
Slide 4: Production Growing and on Target
Production Growing and on Target For personal use only 10,000 9,000 8,799 Rare Earth Oxide (Tonnes) 8,000 7,000 6,000 5,000 3,965 4,000 3,171 3,000 2,606 2,177 2,258 2,043 1,973 2,000 946 839 968 1,000 542 445 432 0 FY14 Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15 YTD FY15 Q1 FY16 Production volume total Produc
Slide 5: Sales Growing by Volume and by Value
Sales Growing by Volume and by Value For personal use only 10,000 7,883 t 3,008 t 2,691 t 2,353 t 2,014 t 1,970 t 1,546 t 1,000 $155.3m 100 $58.4m $52.7m $55.9m $44.2m $32.4m $25.9m 10 1 FY14 Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15 YTD FY15 Q1 FY16 Sales volume (REO t) Sales Collection (AU$ million) 5
Slide 6: 25% Reduction in Unit Operating Cost
25% REDUCTION IN UNIT OPERATING COST For personal use only Operating Cost / Kg AU $ (excl. depreciation) 25.0 20.0 15.0 10.0 5.0 0.0 Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15 Q1 FY16 6
Slide 7: 40% reduction in Overheads
40% reduction in Overheads For personal use only Overheads vs LAMP Production (excl. restructuring costs & employee share based payment) 3,500 10.0 8.8 8.8 9.0 Production Volume (REO t) 8.4 3,000 8.0 2,500 7.0 6.3 5.6 6.0 2,000 5.3 A$'mil 5.0 1,500 4.0 1,000 3.0 2.0 500 1.0 0 - Q4 FY14 Q1 FY15 Q2 FY
Slide 8: Right sized workforce delivering improved efficiency
Right sized workforce delivering improved efficiency For personal use only Headcount vs Production 1,200 900 800 1,000 Production Volume (REO t) Production Headcount 700 800 600 600 500 400 400 200 300 0 200 Production Volume REOt Total Production Headcount 8
Slide 9: Production planned to optimise equipment and energy use
Production planned to optimise equipment and energy use For personal use only Electricity vs Production (Index) 180% • 55% growth in production 160% 155% • 16% growth in electricity 140% consumption 128% 120% 107% 100% 97% 116% 100% 112% 100% 97% 98% 80% 60% 40% 20% 0% Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY1
Slide 10: Production planned to optimise equipment and energy use
Production planned to optimise equipment and energy use For personal use only Gas vs Oxides Production (Index) 250% 215% • 115% growth in Oxide production 200% • 16% growth in gas consumption 161% 150% 132% 113% 100% 118% 100% 112% 116% 100% 99% 50% 0% Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15 Q1 FY16 Product
Slide 11: Reduced Logistics costs
Reduced Logistics costs WA Landside transport For personal use only 6,000 500 450 5,500 400 5,000 350 4,500 300 Costs per No of 4,000 250 Container containers 200 3,500 150 3,000 100 2,500 50 2,000 0 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Total Containers shipped Average costs p
Slide 12: Reduced logistics costs: Sea Freight
Reduced logistics costs Sea Freight U$ / containeruse only 1300 1200 Savings ranging 1100 from 49% - 52% 1000 For personal 900 800 700 600 500 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Company 1 Company 2 Company 3 12
Slide 13: Improved cash flow
Improved cash flow For personal use only Cash Flow 20 0 AU $ million -20 -40 -60 -80 -100 -120 FY14 Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15 YTD FY15 Q1 FY16 Net operating cash flow -103.2 -10.8 -5.1 -24.0 7.9 -31.9 4.5 Net investing cash flow -8.6 -0.8 -3.0 -4.4 -1.5 -9.6 -3.2 Total operating and investing
Slide 14: Mining and 1st Stage processing at Mt Weld, WA
Mining and 1st Stage processing at Mt Weld, WA For personal use only Tony Malloch GM Mt Weld
Slide 15: Our Challenges: Our Resource, Water, Distance
Our Challenges: Our Resource, Water, Distance For personal use only
Slide 16: Committed to Safety & Environmental protections
Committed to Safety & Environmental protections For personal use only Ducks on the tailings dam at Mt Weld Local Wildlife
Slide 17: Radiation Safety Monitoring Program
Radiation Safety Monitoring Program For personal use only 3 programs carried out by an AELB accredited consultant • Occupational Exposure Monitoring Program (OEMP) • Environmental Radiation Monitoring Program (ERMP) • Aerosol Monitoring System (AMS) Results • ERMP off-site showed radiation levels th
Slide 18: Kuantan, Malaysia
For personal use only Kuantan, Malaysia
Slide 19: Rare Earths Market Estimates
Rare Earths Market Estimates Increasing growth rates especially in magnets For personal use only Estimated REO demand in magnet industry 50 45 40 2010-2020 CAGR: 9% 35 Other • Approx. 1/3 Processed in CHINA 30 Automation & Drives kt REO 25 Electronics and consumed CHINA HEV/EV • Approx. 1/3 Processe
Slide 20: Rare Earths Magnets are the best choice for small/medium motors
Rare Earths Magnets are the best choice for small/medium motors For personal use only Smaller size/weight Asynchronous Wired ABS pump Ferrite NdFeB 1400gr 700gr Electrical Power efficiency • NdFeB benefits fully leveraged with e-cars • Weight reduction = Reduced consumption • Better efficiency = Sma
Slide 21: Lynas can differentiate as a supplier
Lynas can differentiate as a supplier For personal use only • Quality and environmental assurance from mine to customer is important in key growth segments (Automotive, Wind turbines) – Lynas offers assurance and traceability of all product • Rare Earths products can be differentiated based on quali
Slide 22: Our Team
For personal use only Our Team
Slide 23: Rare Earths Market Data: Disclaimer
Rare Earths Market Data: Disclaimer For personal use only The slides in this presentation containing Rare Earths market data have been sourced from independent analysis of end application demand, along with Lynas estimates of quantities of Rare Earths end use in various key applications. Althoug