Antelope Enterprise Holdings Limited · NASDAQ:AEHL
Antelope Enterprise — China Ceramics — Investor Presentation (March 2011)
29 slides from Antelope Enterprise's investor presentation, Mar 22, 2011
Slide 1: China Ceramics Co., Ltd.
CHINA CERAMICS CO., LTD. kp China Ceramics Co., Ltd. WWW.CCERAMICS.COM
Slide 2: Forward-looking statements
This presentation contains forward-looking statements and management may make additional forward-looking statements in response to your questions. Such written and oral disclosures are made pursuant to the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Although we bel
Slide 3: Robust Growth
Robust Growth » Founded as Jinjiang Hengda Ceramics EDS in 1993 2 USD in MM >» Five different types of ceramics tiles used for exterior siding > Over 2,000 color and size combinations > Current capacity of 42.2 mm sq. meters in Jinjiang Hengda and recently acquired Hengdali facility » Growth in outd
Slide 4: Equity Snapshot
S| Equity Snapshot ki NasdaqGM: CCCL FYE: DEC 31 Price (3/10/11) $6.76 Basic Shares Outstanding* 16.5 MM Market Cap. $111.5 MM Cash (Dec 31) $39.9 MM Debt (Dec 31) $14.7MM Revenue (FY 2010) $159.2 MM Net Income (FY 2010) $33.6 MM Diluted EPS (FY 2010) $2.53 *We have 16.5M shares outstanding and appr
Slide 5: Company history and milestones
Founded in 1993 as a Received the certification Introduced state-of-art manufacturer of of ISO9002, ISO9001 equipment from abroad; outdoor ceramics tiles » and 1SO14001 in 1999; » Expanded capacity to in Jinjiang, Fujian Gradually built up brand 32.2 mm sq. meters Province reputation with 9 producti
Slide 6: Corporate structure
China Ceramics Co. Ltd. (CCCL:NASDAQ) (BVI) Nov 2009 Nov 2009 100% Success Winner Limited (BVI) May 2009 Jun 2009 100% Vv Stand Best Creation Jinjiang Hengda Ceramics Co., Ltd. Sep 1993 Jan 2010 100% v Jiangxi Hengdali Ceramic Materials Co., Ltd. Jun 2008 a Former SPAC: China Holdings Acquisition Co
Slide 7: Prominent manufacturer of exterior ceramic tiles with meaningful market share
2 + Prominent manufacturer of exterior ceramic tiles with meaningful market share Construction materials industry benefits from urbanization trend Favorable government policies to stimulate demand, especially in Tier II & III cities Visible brand known for quality and innovation Location which is op
Slide 8: Outdoor ceramic tile market correlated to urbanization
itdoor ceramic tile market correlated to: » Total urban population reached 622 million in 2009 as compared to 450 million in 2001 > Tier | cities are expected to account for only 10% of China’s commercial real estate activities by 2020, which highlights the significant development opportunities in T
Slide 9: Stimulus and low-income housing
> Stimulus - Benefit from China’s US$585 billion economic stimulus plan to emphasize real estate development >» Low-income housing - ~77% of the new land supply announced in April 2010 by the Ministry of Lands and Resettlement (MLR) was earmarked for low- income housing mainly in Tier II and III cit
Slide 10: Long-term urbanization trend and Tier II and III cities
» Beneficiary of long-term sustainable PRC urbanization trend » Product trend — Such new products as “Green”, lighter, heat insulating and noise- reduction outdoor ceramic tiles will be introduced » Potential of Tier II and III cities + Much of the growth in China’s GDP is being driven by economic a
Slide 11: Highly fragmented outdoor ceramics tile industry
» China’s outdoor ceramics tile industry is highly fragmented with hundreds of manufacturers » More than 200 manufacturers are located in Jinjiang, with a combined annual production volume of 70% of China’s total production volume » Others are mainly located in Foshan, Zibo, Linyi, Dehua and Jiajian
Slide 12: Product Suite
ve Product Suite cam The company has over 2,000 color and size combinations Rustic 7% of Sales Glazed 10% of Sales a Porcelain 74% of Sales TRE & Ultra Thin 4% of Sales Glazed Porcelain 5% of Sales ! Nand ! Wide array of standardized and made-to-order products 12
Slide 13: Patents, awards and R&D
» Own 4 utility model patents and have exclusive right to use 11 design patents » Awarded Asia's 500 Most Influential Brands of 2010 >» Awarded a “High-tech Enterprise Certificate” in 2007 from Fujian Provincial Department of Science and Technology » 85 person R&D team developed over 2,000 types of
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Slide 15: Sales coverage and distribution
Vv Vv Real estate Developers 11% of sales Sell ~89% of products to 40 exclusive distributors domestically and 6 internationally Other 11% sold directly to larger real estate developers through own sales force. Over 10 years’ cooperation with top 10 clients, who represented 43% of salesin Qe 2009 ; &
Slide 16: Sales process
Discuss design and Sign Meet/Introduction to customers After-sales Delivery ie product contracts specifications » Our sales people correspond with 40 exclusive distributors in different regions and do the direct sales Good communication between our sales force and distributors to avoid sales overlap
Slide 17: Selected Hengda Projects
Selected Hengda Projects = a The 11th National Games Village China Resources Land Limited Lanxi Town Chengdu Kanjun Garden Xiamen Blue Gulf Peninsula Hangzhou Redbud Garden Shenyang Institute of Aeronautical Engineering ? a 53,000 sq. meters 97,000 sq. meters 7 133,000 sq. meters
Slide 18: Raw materials
> > e Clay and coal are 2 major raw materials, accounting for 47% of COGS Over 10 years’ cooperation with key suppliers to ensure on-time supply and stable price All raw material inspected on delivery for quality control Raw Material % of COGS # of Suppliers Clay 27 9 Coal 20 6 Coloring 16 8 Glazing
Slide 19: Competitive strengths
» Customized product - Nearly all production is built to order for specific projects. Continuously focused on R&D to meet customers’ demands » High quality product - ISO certified and use international manufacturing equipment. Sell to customers who demand high quality (including a large Japanese con
Slide 20: Capacity expansion
Hengda facility Update 4 production lines by 2010 and the other 5 by 2011 > Increase total capacity by 15% and 14% yoy to 32.2M and 36.8M sq. meters by 2011 and 2012 respectively Hengdali facility Complete 2"¢ Phase by April 2011 » Add-in additional 14M sq. meters annual capacity Complete 3 Phase by
Slide 21: Growth strategy
, > Expand capacity at Hengda and Hengdali facility (reduce reliance on OEM contracts) > Continue to broaden product suite through innovative R&D > Broaden distribution network (domestic and international) > Evaluate selective (horizontal) M&A opportunities We will be well positioned to take advanta
Slide 22: Revenue growth
_—,' Year CAGR: 25.2% 160 FYE: Dec 31 30.3% $159.2 (USD In millions) 140 ral $1222 120 $105.9 100 $81.1 80 60 40 20 0 T : T 1 2007 2008 2009 2010 For statements of financial position data, translation of RMB into U.S. dollars has been made using historic spot exchange rates published by wi federalre
Slide 23: Strong Financial Margins
Strong inancial Margins FYE: Dec 31 60 30% 2BIGD In 28% 29% 31% 24% 22% 50 40 30 20 10 FyY2007 FY2008 FY2009 FY2010 @ Gross Profit @ Net Profit Planned reduction in OEM outsourcing and increased capacity should improve margi For statements of financial position data, translation of RMB into U.S. dol
Slide 24: Balance sheet summary
As of Dec 31 (USD In millions) 2008 2009 2010 Cash 7.6 22.0 39.9 Debt 1.8 3.9 14.7 Total Working Capital 26.6 64.5 62.7 Shareholder’s Equity 37.2 73.9 133.7 Days Sales Outstanding 93 102 95 Inventory Turnover 98 77 73 24
Slide 25: Earn-out share release terms
>» The maximum shares will be released if we achieve the net income target > If the stock price reaches $20 for 20 trading days within a 30 day period prior to April 30, 2012, 2 million shares will be issued; if the stock price trades at or above $25, an additional 1 million shares will be issued >»
Slide 26: Management team
Jiadong » Founder of Jinjiang Hengda Ceramics Co., Ltd. Huang » 20 years of experience in the China Ceramic Tile Industry CEO > Vice chairman of Fujian Province Ceramic Industry Association >» Former CFO of a Sichuan switchgear manufacturer >» Accountant of Dickson Concepts Ltd. from 2002 to 2005 »
Slide 27: Board of directors
Founder, President and CEO of Knox & Co. and Peers & Co., both international Paul K. Kelly financial advisory firms focused on Asia Non-Executive > Chairman and CEO of the Westgate Group, Inc., a strategic advisory firm Chairman focusing upon cross-border business opportunities for clients, with an
Slide 28: Prominent manufacturer of exterior ceramic tiles with meaningful market share
Prominent manufacturer of exterior ceramic tiles with meaningful market share Construction materials industry benefits from urbanization trend Favorable government policies to stimulate demand, especially in Tier II & III cities Visible brand known for quality and innovation Location which is optima
Slide 29: Contact and investor relations
7 We China Ceramics Co. Ltd. CCG Investor Relations Edmund Hen, CFO Mr. Ed Job, CFA Email: info@cceramics.com Phone: (86) 21 3133 5075 Email: ed.job@ccgir.com BE SAuDIIOY. ee Loeb & Loeb Grant Thornton PRC Mitchell Nussbaum, Partner Tel: (86) 21 2322 0200 Tel: (1) 212 407 4159 Email: mnussbaum@loeb.