Lynas Rare Earths Limited · ASX:LYC
Lynas Rare Earths — Investor Presentation (August 2020)
41 slides from Lynas Rare Earths's investor presentation, Aug 17, 2020
Slide 1: Lynas Corporation Equity Raising Presentation
LYNAS CORPORATION EQUITY RAISING PRESENTATION 17 August 2020 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 1
Slide 2: Disclaimer
Disclaimer The following notice and disclaimer applies to this investor presentation (Presentation) and you are therefore Market and industry data advised to read this carefully before reading or making any other use of this Presentation or any information contained in this Presentation. By acceptin
Slide 3: Disclaimer (cont'd)
Disclaimer (cont’d) Not for release or distribution in the United States of America • the proforma historical consolidated statement of financial position as at 30 June 2020 assuming the completion of the Offer (net of transaction costs) (the Pro Forma Historical Financial Information). This Present
Slide 4: Disclaimer (cont'd)
Disclaimer (cont’d) Subsequent events The Financial Information has been prepared based upon conditions existing at 30 June 2020 and Any such statements contained in this Presentation are not indications, guarantees or predictions of future considering those events occurring subsequent to that date,
Slide 5: Disclaimer (cont'd)
Disclaimer (cont’d) Investment Risk and other risks relation to the Offer and you further expressly disclaim that you are in a fiduciary relationship with any of Lynas, the Underwriters or their Limited Parties. You undertake that you will not seek to sue or hold the An investment in New Shares is s
Slide 6: Table of Contents
Table of Contents 1. Equity Raising Summary 2. The Lynas Story 3. Our Growth Strategy 4. Summary Appendix A: JORC Compliance Appendix B: Key Risks Appendix C: International Offer Restrictions 6 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 7: 1. Equity Raising Summary
1. Equity Raising Summary 7 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 8: Funding Lynas 2025 Foundation Projects
Funding Lynas 2025 Foundation Projects • Lynas is raising approximately A$425m through a fully underwritten1 ~A$211.6m institutional placement and a ~A$213.7m Equity Raising pro rata accelerated non-renounceable entitlement offer • Proceeds from the equity raising will fund the Lynas 2025 foundation
Slide 9: Enabling an Exciting Transformation
Enabling an Exciting Transformation ✓ Equity raising will deliver timely ✓ Able to use operating cash ✓ Structure of the offer allows funding for Lynas 2025 flow for other essential capital eligible existing Lynas foundation projects projects including Malaysian shareholders1 to participate in the P
Slide 10: Key Offer Details
Key Offer Details Investors can gain exposure to Rare Earths through an investment in the only significant producer of separated Rare Earths outside of China • Equity raising of approximately A$425m comprising a fully underwritten1 institutional placement of approximately 92 million new fully paid o
Slide 11: Equity Raising Timetable
Equity Raising Timetable Event Date Equity Raising announcement and Placement and Institutional Entitlement Offer open Monday, 17 August 2020 Announce Completion of Placement and Institutional Entitlement Offer Wednesday, 19 August 2020 Trading in Lynas shares resumes on an ex-entitlement basis Wedn
Slide 12: Lynas Pro-forma Capital Structure
Lynas Pro-forma Capital Structure Fit for Purpose pro-forma capital structure Impact of fully Debt Facility 30 June 2020 underwritten1 Pro Forma2 • Equity raising is the next step in prudent capital Equity Raising management JARE Loan Facility ($181m)5 ($181m) • Japan Australia Rare Earths B.V. (JAR
Slide 13: Pro-forma Balance Sheet
Pro-forma Balance Sheet Impact of fully 30 June 20 underwritten equity 30 June 20 raising1 Historical financial Pro forma historical information financial information A$ million A$ million A$ million Cash and cash equivalents 102 415 517 Other current assets and non-current assets 834 834 Total asse
Slide 14: 2. The Lynas Story
2. The Lynas Story 14 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 15: Lynas supplies essential materials to exciting growth industries
Lynas supplies essential materials to exciting growth industries Key Investment Electric Vehicles (EV) – Including Electric drive components, Hybrid motor technology, Electric public transport and Electric aviation Drivers Benefits: Lighter and more efficient high-performance motors Rare Earth produ
Slide 16: Lynas is a Proven Producer of Separated Rare Earths
Lynas is a Proven Producer of Separated Rare Earths 1 Designed to sustainably Inhouse Expertise & Trusted Customer Strong Track Record meet market needs now and Intellectual Property (IP) which Relationships Lynas NdPr Production Cost into the future cannot be easily replicated 250% Index: 100=Avera
Slide 17: Positioning Our Industrial Footprint for a Growing Market
Positioning Our Industrial Footprint for a Growing Market Malaysia 2020: A dynamic operation in Gebeng, Malaysia with Cracking & Leaching, Solvent Extraction, Product Finishing 2025: Opportunities for further downstream processing United States Western Australia July 2020: Contract signed with U.S.
Slide 18: Unlocking the Potential of our Premier Deposit at Mt Weld
Unlocking the Potential of our Premier Deposit at Mt Weld Significant, High-Grade Resources • Tier 1 deposit with 25+ year life at Lynas NEXT rates1 • Mining and Processing higher grade CZ and LI ore since start up • Processing of Duncan ore (higher HRE incl Dy, Tb) since Q1 FY20 • 2019 Mineral Reso
Slide 19: Rare Earth materials used in industries where sustainability matters
Lynas Rare Earth materials are used in industries where sustainability & environmental provenance matters We care for our people: We care for the environment: • The health & safety of our • Environmentally-responsible people, our communities and Rare Earths producer by the environment is always our
Slide 20: Trend of financial results
Trend of financial results Production Volume (REOt1) COVID-19 25,000 COVID-19 420 Sales Revenue (A$'m) production halt production halt 370 20,000 320 15,000 270 220 10,000 170 5,000 120 5,223 5,444 5,898 4,656 70 2,257 3,896 0 20 FY15 FY16 FY17 FY18 FY19 FY20 FY15 FY16 FY17 FY18 FY19 FY20 NdPr (RTS)
Slide 21: Board & Management Team Supporting the Lynas 2025 Vision
Board & Management Team Supporting the Lynas 2025 Vision Kathleen Conlon Mike Harding Amanda Lacaze Grant Murdoch Phillippe Etienne Professor John Humphrey Chair-elect Chair Managing Director Non-Executive Non-Executive (retiring 30th September 2020) Director Director Non-Executive Director Gaudenz
Slide 22: 3. Our Growth Strategy
Appendices 3. Our Growth Strategy 22 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 23: Transforming for the Future
Transforming for the Future Lynas Today Lynas in 2023 Our Vision for 2025 Capital Projects Plan • Tier 1 Rare Earths deposit at Mt • Upgrades at Mt Weld to improve • A larger business to meet • Kalgoorlie Rare Earths Weld operational delivery forecast demand growth Processing Facility plus associate
Slide 24: Developing Value-Added Rare Earth Processing in Western Australia
Developing Value-Added Rare Earth Processing in Western Australia Creating a Rare Earths processing Delivering on government policy for Engaging with the Kalgoorlie Contributing to the Kalgoorlie hub in the Goldfields region, WA critical minerals processing community & regulators economy • Kalgoorli
Slide 25: Making progress on our planned Kalgoorlie Rare Earths Processing Facility
Making progress on our planned Kalgoorlie Rare Earths Processing Facility A foundation project for the Lynas 2025 growth plan • Construction expected to commence in mid 2021 , subject to approvals • Facility will process Rare Earth concentrate from Mt Weld to produce mixed Rare Earth carbonate that
Slide 26: Building the foundations for our future growth
Building the foundations for our future growth 2019 2020 2021 2022 2023 Commence Duncan ore processing Mt Weld Upgrades Malaysian PDF project Kalgoorlie Rare Earths Processing Facility project Lynas Malaysia Plant Upgrades Dates illustrated are indicative and may be affected by a variety of factors
Slide 27: 4. Summary
4. Summary 27 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 28: Lynas is transforming for the future
Lynas is transforming for the future • Lynas is raising approximately $425m through a fully underwritten1 ~A$211.6m institutional placement and a ~A$213.7m pro rata accelerated non-renounceable entitlement offer, to fund – Planned Kalgoorlie Rare Earths Processing Facility to produce mixed Rare Eart
Slide 29: The Rare Earths Company of Choice
The Rare Earths Company of Choice Market Opportunities Unique Market Established Operations Growth & Expansion Proven Team Position with Significant IP Opportunities • Long term demand • World’s second largest • Proven and profitable • Mt Weld – Tier 1 Deposit • Corporate culture outlook for key Rar
Slide 30: Visit our Investor Centre
Visit our Investor Centre at: www.lynascorp.com 30 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 31: Appendix A: JORC Compliance
Appendix A: JORC Compliance 31 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 32: JORC Compliance
JORC Compliance The information in this presentation is extracted from the report entitled Lynas Corporation 2019 Annual Report created on (October 2 2019) and is available to view on (https://www.lynascorp.com/wp-content/uploads/2019/10/191002-Annual-Report- Appendix-4G-and-Corporate-Governance-Sta
Slide 33: Appendix B: Key Risks
Appendix B: Key Risks 33 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 34: Key Risks
Key Risks This section discusses some of the key risks associated with an investment in Lynas, which may affect Lynas’ business, its operating and Operational risks financial performance, and the value of Lynas shares (including New Shares issued in connection with the Placement or Entitlement Offer
Slide 35: Key Risks (cont'd)
Key Risks (cont’d) Nature of mining Availability of key inputs, including Water Mineral mining involves risks, which even with a combination of experience, knowledge and careful evaluation may not be able to be fully The Mt Weld Mine and Concentration Plant and the Lynas Malaysia Plant rely on the r
Slide 36: Key Risks (cont'd)
Key Risks (cont’d) Data and cyber security risks also may not be able to ensure the security of its assets located outside Australia, and is subject to risks of, among other things, loss of Lynas may be subject to network and systems interference from a number of sources, such as cyber-attacks, secu
Slide 37: Key Risks (cont'd)
Key Risks (cont’d) Disposal of Residues Lynas to seek amendments, waivers of covenant compliance or alternative borrowing arrangements. There is no assurance that its lenders At the Mt Weld Mine and Concentration Plant, the Lynas Malaysia Plant, and the new proposed Lynas Kalgoorlie Rare Earths Proc
Slide 38: Key Risks (cont'd)
Key Risks (cont’d) Volatility and liquidity risk • In respect of any one or more of Australia, New Zealand, Malaysia, Japan, Hong Kong, the USA or the UK: While Lynas shares are currently listed on ASX, there is no guarantee that there will at all times be sufficient buyers of shares to enable • the
Slide 39: Appendix C: International Offer Restrictions
Appendix C: International Offer Restrictions 39 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 40: International Offer Restrictions
International Offer Restrictions This document does not constitute an offer of new ordinary shares (New Shares) of Lynas Corporation Limited (Company) in any jurisdiction in any action, other than an action for rescission, the earlier of (i) 180 days after the purchaser first had knowledge of the fa
Slide 41: International Offer Restrictions (cont'd)
International Offer Restrictions (cont’d) Malaysia authorised review body. In particular, this document will not be filed with, and the offer of New Shares will not be supervised by, the Swiss No approval from, or recognition by, the Securities Commission of Malaysia has been or will be obtained in
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