Clearsign Technologies Corporation · NASDAQ:CLIR
Clearsign Technologies — ClearSign Combustion — Investor Presentation (August 2018)
28 slides from Clearsign Technologies's investor presentation, Aug 29, 2018
Slide 1: The Future of Combustion: Clean Air, Low Cost, Rapid Payback
The Future of Combustion: Clean Air, Low Cost, Rapid Payback NASDAQ: CLIR
Slide 2: Cautionary Note on Forward-Looking Statements
Cautionary Note on Forward - Looking Statements This presentation contains forward - looking statements. These statements include statements about our plans, strategies, financia l performance, prospects or future events and involve known and unknown risks that are difficult to predict. As a result,
Slide 3: Urgent, Global Problem
Urgent, Global Problem 3 From Los Angeles… … to Beijing
Slide 4: Patented, Disruptive Solution
Patented, Disruptive Solution 4 >30%+ FGR (OEM) Low BTU Co - fired Prototype 4
Slide 5: Increasing Opportunity Backlog
Increasing Opportunity Backlog 5 0 10 20 30 40 50 60 70 80 Jul-17 Dec-17 Jun-18 Active Engagements (ex-Asia)
Slide 6: Investment Highlights
Investment Highlights 6 • Large, growing global addressable market ($3.6B+) [Frost & Sullivan] • Patented and proven technology provides transformational improvement in emissions and overall operating costs – 200 patents filed (73 issued, 117 pending) – Demonstrated to reduce NOx emissions below tou
Slide 7: Combustion Market Opportunity
Combustion Market Opportunity 7 x Fundamental: The lighting of a flame and the resulting heat (i.e. – combustion) is a fundamental energy conversion process x Ubiquitous: 2/3 of energy used in U.S. manufacturing converted via combustion in CLIR’s core market of boilers, furnaces and process heaters¹
Slide 8: ClearSign: U.S. Targeted Markets
ClearSign: U.S. Targeted Markets 8 Refinery Segment • up to $826M ¹ Enhanced Oil Recovery (EOR) Segment • up to $100M ² Large Industrial Segment • up to $802M ¹ Institutional Commercial and Industrial (ICI) Boiler Segment • up to $1,723M ¹ Flare Segment • up to $201M ¹ Targeted 10 - Year Addressable
Slide 9: China Market Opportunity
China Market Opportunity 9 Mandatory • Govt. mandates drive investment and local participation • $300 billion spent to reduce air pollution (2013 - 2017) • Multi - billion dollar market with motivated local operating partners Multiple Duplex Markets • District Heating • Refinery • Steel • Pulp & Pap
Slide 10: China: Targeted Entry Strategy
China: Targeted Entry Strategy 10 District Heating Area in China District Heating Area Non District Heating Area
Slide 11: China: Targeted Entry Strategy
China: Targeted Entry Strategy 11 • District heating represents critical market segment • Government mandates forcing rapid conversion to gas fired boilers (CLIR’s target market) • China’s ICI boiler market roughly double size of U.S. and growing Gas Fired Oil Fired Coal Fired Other 9,635 (82%) 655
Slide 12: Duplex: Transformational Technology
Duplex™: Transformational Technology 12 Key Benefits: x Reduced NOx emissions : ~90 - 95% reduction, below toughest regulatory requirements (5 ppm); Recognition from multiple regulators for potential “BACT” designation x Increased operational efficiency: More effective radiant heat transfer; no need
Slide 13: Duplex Installation Varieties
Duplex ™ Installation Varieties 13 FLARES PACKAGE BOILERS
Slide 14: Duplex Plug & Play: Productized Solution
Duplex Plug & Play™: Productized Solution Simple, pre - engineered, direct burner replacement from standardized components: x “Off - the - shelf” Quick and Easy Installation x Eliminates Flame Impingement x Eliminates Burner - to - Burner Interference x Ideal for Up - fired Heater Applications x "On
Slide 15: Duplex: Commercial Projects
Duplex™: Commercial Projects Multiple Blue - Chip, Early Adopters in Key Verticals 1. Refinery : 3 completed installations, 2 in process 2. Enhanced Oil Recovery : 3 completed 3. Enclosed Flares : 6 completed 4. Packaged Boilers : 3 in process 5. Large Industrial : in development 15
Slide 16: Duplex Performance vs OEMs
Duplex Performance vs OEMs 16 >30%+ FGR (OEM) Low BTU Co - fired Prototype 4
Slide 17: Duplex vs SCR
Duplex vs SCR 17 Source: Norton Engineering – Duplex Technology Evaluation and Cost Comparison to SCR, January 2017 Three Sample Case Cost Comparisons 10 - Year Lifetime Periodic Costs
Slide 18: Competitive Position
Competitive Position 18 Duplex Low NOx Burner SCR Systems NOx Performance < 5 ppm < 15 ppm < 5 ppm CAPEX Low Low Very High OPEX Very Low Very Low Very High Installation Time Very Low Very Low Very High
Slide 19: Duplex: An Asset-Lite Business Model
Duplex™: An “Asset - Lite” Business Model • Unique value proposition provides strong potential margins (> 50%) • Minimum working capital and CapEx requirements • Simple, cost - effective designs • Designs allow subcontracting or licensing through existing regional partners trusted by customers • Pat
Slide 20: Key Market Drivers
Key Market Drivers • Mandatory Regulatory Compliance : Increasing regulation of NOx and other pollutants across the U.S.(Clean Air Act and Rule 4311), Canada, Europe and China – Operators in our target markets are under pressure to meet current and proposed federal, state, and local pollution emissi
Slide 21: Market Drivers: Ozone Nonattainment Areas
Market Drivers 21 Projected 8 - Hour Ozone Nonattainment Areas Source: URS, August 2015 Monitored CBSAs and rural counties that would be violating a 70 ppb standard Unmonitored areas that are anticipated to violate a 70 ppb standard based on spatial interpolation
Slide 22: Strong Intellectual Property
Strong Intellectual Property Rapidly expanding patent portfolio & complete freedom to practice 22 117 Patents Pending 73 Patents Granted
Slide 23: Patent Score Card
Patent Score Card • Patent Totals (as of Q2 2018): – 200 total Patents filed – 73 Patents Issued (5 ECC+PFH, 15 PFH, 53 ECC) – 10 Allowed (2 ECC+PFH, 5 PFH, 3 ECC) – 117 Pending (7 ECC+PFH, 37 ECC, 72 PFH, 1 other) • 98.2% Issuance Rate 23 134 US 4 CA 36 CN 2 AU 11 EP 1 DE 11 WIPO Worldwide Distribu
Slide 24: Experienced Leadership
Experienced Leadership Steve Pirnat Chief Executive Officer • CEO, John Zink, div. Koch Ind. • Managing Dir. EMEA, Quest Integrity Group Steve Sock SVP Business Development • Business Development Manager, Burrow Global • VP Commercial, Amec Foster Wheeler Brian Fike Chief Financial Officer • Regiona
Slide 25: Increasing Opportunity Backlog
Increasing Opportunity Backlog 25 Active engagements are for specific client requests where a need has been identified and Duplex is being considered as the solution 0 10 20 30 40 50 60 70 80 Jul-17 Dec-17 Jun-18 Active Engagements (ex-Asia)
Slide 26: Balance Sheet & Cap Table
Balance Sheet & Cap Table 26 Capitalization Table as of June 30, 2018 Common Shares Outstanding 21,417,909 Options Outstanding 1,005,835 Warrants Outstanding 2,495,784 Total Fully Diluted Shares Outstanding 24,919,528 Balance Sheet at a Glance Cash & Cash equivalents (June 30, 2018) $8,359,000 Priva
Slide 27: Investment Highlights
Investment Highlights 27 • Large, growing global addressable market ($3.6B+) [Frost & Sullivan] • Patented and proven technology provides transformational improvement in emissions and overall operating costs – 200 patents filed (73 issued, 117 pending) – Demonstrated to reduce NOx emissions below to
Slide 28: Questions?
Questions?
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