Rino International Corp. · OTC:RINO
Rino International — Investor Presentation (November 2008)
33 slides from Rino International's investor presentation, Nov 20, 2008
Slide 1: RINO International Corp - Investor Presentation 2008
Sa Ky RINO International Corp RIND OTC BB : RINO / A PROMISE OF GREEN Investor Presentation 2008, ~~
Slide 2: Safe Harbor for Forward Looking Statement
Safe Harbor for Forward Looking Statement _ This presentation may contain forward-looking information about RINO International Corp., its direct and indirect subsidiaries, including Innomind Group Limited and Dalian Innomind Environment Engineering Co., Ltd. (‘Innomind”), its contractually-controlle
Slide 3: Ticker RINO key statistics
Ticker RINO Exchange OTCBB Share Price (11/07/2008) $2.50 FD Shares Outstanding 25.4 MM Market Cap $63.5MM Management Ownership 71% Last Raise (10-12-07) $24.4MM Gross Shares Issued 5.58MM Revenue (15t 9 Months) $98.5MM Net Income (15* 9Months) $31.9MM* Diluted Non GAAP Earnings Per Share $1.27 1st
Slide 4: Revenue & Net Income Growth
Revenue & Net Income Growth (S in millions)... $100.0 $30.0 $63.6 $60.0 $31.9 Soe: $28.0 s20.0 $17.7 a $8.6 $3.6 593 $3.2 $0.0 z= FY 2005 FY 2006 FY2007* — 1st 9M 2008** 2008 NI Target*** @ Revenue Net Income “Non-GAAP — excluding $7.5 million non-cash, equity compensation expenses related to the re
Slide 5: Company overview and addressable market
“+ Dalian Rino was Founded in 2003 and based in Dalian, China. “+ Leading provider of pollution control and clean technology solutions for Chinese steel manufacturers. Environmental services industry is one of the fastest growing industries in China. % Profitable since inception and sales growth has
Slide 6: RINO manufactures wastewater, desulphurization and anti-oxidation equipment
RINO manufactures wastewater treatment, sinter flue gas desulphurization and anti-oxidation equipment for lron & Steel customers in the PRC. RINO addresses one of the largest and fastest growing markets for these products worldwide. % Specializes in providing customized turn-key solutions, including
Slide 7: Market leader, R&D focus, cost advantage
Market Leader and Brand Recognition in the Industry: RINO’s brand recognition and reputation in the Iron & Steel industry has enabled it to gain market share while cross selling its products to a large installed customer base. Strong R & D Focus: RINO is focused on developing proprietary and patente
Slide 8: Pollution problems in China
% Pollution problems in China are estimated to cost the country more than $200B annually. *% Pollution is widely considered the #1 challenge and the single biggest threat to sustained economic growth. % Environmental protection is a top priority at the central government level and regulations are be
Slide 9: Environmental industry investment by Five-Year Plan
10th Five-Year 11th Five-Year Plan Plan CAGR (in billion US$) 2001-2005 2006-2010 Waste Water Treatment 39.71 94.12 18.80% Air Pollution Treatment 41.18 88.24 16.50% Solid Waste Treatment 13.24 30.88 18.50% Others 8.82 9.56 1.62% Total Investment in Environmental Industry 102.94 225.00 16.90% % of G
Slide 10: Products and revenue breakdown first nine months 2008
“* Wastewater Treatment Equipment + Sinter Flue Gas Desulphurization Equipment > Add On: Sinter Flue Gas Dust Abatement Equipment + High Temperature Anti-Oxidation Equipment & Coatings “ Heavy Machining Services Revenue Breakdown For First Nine Months 2008 Wastewater Treatment Equipment 1 Fue Gas De
Slide 11: Wastewater treatment challenges and opportunities
Challenges * Steel production utilizes significant water resources. * Currently, there are 730 blast furnaces over 300m? in size and 670 steel- making converters with capacity over 75 tons operating in China which are equipped with wastewater treatment. Opportunities “ The majority of this legacy eq
Slide 12: The RINO Solution: Lamella Inclined Tube Settler
The RINO Solution... Lamella Inclined Tube Settler Comprehensive Water Sedimentation System “* Uses proprietary and patented technology which removes up to 98% of particulates, producing 100-150 m3 of effluent water per hour with an average of 50mg/L of particulates. “ RINO’s system is a market lead
Slide 13: China SO2 Emissions
China SO2 Emissions Mens a of . =I 2001 2002 2003 2004 2005 2008 “+ North American emissions of SO, have been falling while emissions in Asia have risen. + Chinese official statistics record 25.9 million tons of SO, emissions in 2006, well above targets. The increase in steel production has been a p
Slide 14: Desulphurization Market in China
esulphurization Market in China al Challenges “Primary cause of airborne pollution in China is sulphur dioxide (SO,) emissions from coal. In 20085, the iron & steel industry discharged 1.24M metric tons of SO, emissions from the sintering process. Opportunities + The 11th Five Year plan calls for al
Slide 15: Circulating Fluidized Bed Flue Gas Desulphurization Cleaning System
ae | Circulating Fluidized Bed Flue Gas Desulphurization Cleaning System “+ Proprietary and patented technology developed by the China Academy of Sciences - RINO has exclusive commercialization rights with 21 installations. * Achieves 90 - 99% removal of SO, by using patented technology which keeps
Slide 16: Handan Steel desulphurization contract
Based in Hebei Province, Handan Steel is a state-owned-enterprise (or “SOE") which produces steel billets, steel products, sintering products and coke, among others. The company is publicly traded on Shanghai Stock Exchange and generated approximately $3.8 B in revenue in 2007, August, 2007 — Initia
Slide 17: Sinter Flue Gas Dust Abatement Equipment
Sinter Flue Gas Dust Abatement Equipment Completes the cleaning of sinter flue gases by reducing the dust load and is incorporated into the desulphurization unit. Cost Effective ~ $2 million per unit. “Combines electrical precipitators with cloth dust bags to achieve exhaust dust volumes within regu
Slide 18: Anti-Oxidation Market
nti-Oxidation Marke Challenge “ China produced approximately 460 million Hot Rolled Steel Output tons of crude steel in 2007, a 10% increase ™"""™" from 2006, according to the China State so Development and Reform Commission. owe * Historically, hot rolled steel accounts for a more than 90% of Chine
Slide 19: The RINO Solution: High Temperature Anti-oxidation System
The RINO Solution... High Temperature Anti-oxidation System for Hot Rolled Steel Developed by China Academy of Sciences -RINO 1 has exclusive rights. Reduces oxidation loss by over 60%, from current levels to approximately 1.2%. Each unit services one steel line and costs approximately $1.4 million
Slide 20: Machining services
% In addition to producing our products, we offer machining services to shipbuilders and other customers in the Dalian area thus optimizing our capacity utilization “+ We execute 700 — 900 engagements per year, ranging from projects smaller than fire plugs to large turbines the size of 18-wheelers.
Slide 21: Competitive advantages by product
Wastewater Treatment Compared with commonly-used inclined plate settling pools, RINO has clear advantages: > Lower installation, usage, and maintenance costs, smaller footprint and land utilization > Higher throughput plus energy savings — recycles water in closed loop system Desulphurization RINO h
Slide 22: Labor cost comparison with international suppliers
International RINO Suppliers Unit Not Applicable (NA) $40 hour (fully burdened) NA" 40 hours/week NA 433 weeks/month $410" $6,928 monthly compensation * Many of the workers live on site and this amount does not include housing costs - typical work day is 8-10 hours depending upon role “+ RINO has si
Slide 23: Significant Cross-Selling Opportunities Exist
Significant Cross-Selling Opportunities Exist stomer Base Users Equipment installed Jinan Iron & Steel Group Co., Ltd. Benxi Iron & Steel (Group) Co., Ltd. Wastewater Treatment System Desuiphurization System Anti-oxidation System Wastewater Treatment System Anti-oxidation System Handan Iron & Steel
Slide 24: Compelling Growth Strategies
pelling Growth Strategies al Increase backlog and continue executing by expanding internal production capacity and leveraging virtual production at customers’ facilities. Continue to maintain strict cost control measures to optimize profitability and improve return on assets. Target Gross Margins of
Slide 25: Chinese Academy of Sciences
CHINESE ACADEMY OF SCIENCES Key partnership with the China Academy of Sciences (CAS) which is focused on scientific and technological research and development to be utilized for the country’s high-tech industrialization endeavor. RINO develops the technology in cooperation with CAS and licenses the
Slide 26: Management Team
canal Management Team —_— Management has extensive experience in the environmental protection industry and is committed to reaching its business objective — to be the #1 environmental protection equipment company for the industries that RINO serves. Zou Dejun —is the Chief Executive Officer and a di
Slide 27: Financial Review FY2007
and accredited investors through issuing 5.6 million shares @ $4.48/share. inanclal Review ss Completed reverse merger in October 2007 and $24.4 million private placement (gross proceeds) with institutional ‘As a component of the private placement management placed 1.7 million shares of common stock
Slide 28: Third Quarter 2008 Selected Financials
in genes of 2008 Selected Fi i Third Quarter 2008 Q3 2008 Q3 2007 Net Sales $44.9 million 1155% $17.6 million Gross Profit $20.6 million 1182% $7.3 million Net Income* $157 million t265% $4.3 million GAAP Net Income $9.9 million $4.3 million EPS (Diluted)* $0.62 158% $0.24 GAAP EPS (Diluted) $0.39 $
Slide 29: Income Statement
Income Statement ($ in thousands) Q3 2008 Q3 2007 FY2007 FY2006 FY2005 Contracts 43,575 14,789 53,935 8,635, 3,585, Services 1,305 2,849 9,452 1,672 - Net Sales 44,881 17,638 63,387 10,307 3,585 Cost of sales 24.313 10,308 32,920 5,344 2,773 Gross profit 20,567 7,330 30,466 4,962 811 SG&A, and R&D e
Slide 30: Balance Sheet
Assets Cash and cash equivalents Accounts receivable Inventory ‘Advances for inventory purchase Other current assets and prepaid expenses Total current assets Property and equipment, net Accounts receivable (non-current) Intangibles, net Total other assets Total assets Liabilities & Shareholders’ Eq
Slide 31: Peer comparison
Stock Symbol Company Name Market Cap 08 NI Growth 000826.SZ Hejia Resrouces $239MM = $1.01 11.6X 57% 600475.SH Huaguang Holdings s187MM = $0.68 98x -29% 600388.SH Longjing Environment S241MM $1.46 14.3X 7% 600323.SH Nanhai Development S250MM $1.05 16.6X 25% 600649.SH Chentou Holdings $2298 $0.95 11.
Slide 32: Investment Highlights Summary
tment Highlights Summary Fast growing environmental industry with regulatory drivers (SEPA) Government incentives and tax credits significantly lower customer acquisition costs Strong financial results and metrics with visibility High barriers to entry with patented and proprietary technology Market
Slide 33: RINO - Thank You
RINO "i RINO is a Market Leader in the Environmental Protection industry in China. This is an opportunity to participate in a company that services one of the fastest growihg ind markets in China and the fastest growing economy world. RINO is striving to increase their market sh name and dominance m
RINO International — Investor Presentation (November 2008) on 6ix