Rivco Australia Limited · ASX:RIV
Rivco Australia — Investor Presentation (July 2023)
31 slides from Rivco Australia's investor presentation, Jul 3, 2023
Slide 1: Duxton Water Limited Acquisition & Capital Raise Presentation
DUXTON WATER LIMITED ACQUISITION & CAPITAL RAISE PRESENTATION PROUDLY SUPPORTING AUSTRALIAN IRRIGATORS AND FARMERS Duxton Water Limited | Acquisition & Capital Raise
Slide 2: Disclaimer
Disclaimer This presentation is prepared by Duxton Capital (Australia) Pty Ltd [ACN: 164 225 647; AFSL no. 450218] (“DC Australia”) as Investment Manager To the maximum extent permitted by law, MST and its respective affiliates or related bodies corporate, and each of their respective advisers, on b
Slide 3: Contents
Contents Highlights Market update Water entitlement acquisition Capital raising Proforma financials Summary Key contacts Appendices
Slide 4: Highlights
Highlights 1. Duxton Water (“D2O” or “the Company”) has agreed to acquire Australian water entitlements from Treasury Wine Estates (“TWE”). 2. Total acquisition size of $39.1 million. 3. A partially underwritten 1:4 Non-Renounceable Entitlement Offer (of up to $44.2 million) to existing eligible sha
Slide 5: Water Market Update: Weather
WATER MARKET UPDATE Water Market Update: Weather Bureau of Meteorology – chance of exceeding median forecast maps – issued 29 June 2023. Forecast warmer and drier conditions for the Southern Murray Darling Basin • The Bureau of Meteorology (“BOM”) is forecasting drier and warmer than average conditi
Slide 6: Water Market Update: Buybacks
WATER MARKET UPDATE (CONT.) Water Market Update: Buybacks The Australian Government remains committed to delivering the Murray Darling Basin Plan in full. What are Government water buybacks? • Government buybacks are a mechanism through which the Government purchases water licences from the market a
Slide 7: Summary: Acquisition & Capital Raise
Summary Acquisition & Capital Raise This transaction represents a significant growth opportunity for D2O, as it looks to scale its portfolio to support the needs of the Australian farming community. The acquisition of these water assets (4.8 gigalitres) will increase the Company's exposure to two pr
Slide 8: Water Entitlement Acquisition from Treasury Wine Estates
WATER ENTITLEMENT ACQUISITION Water Entitlement Acquisition from Treasury Wine Estates This type of transaction enables Australian farming businesses to release capital from their balance sheets, providing flexibility to invest in land and production assets, while maintaining access to water securit
Slide 9: Leaseback & Call Option of High Security Water Entitlements
WATER ENTITLEMENT LEASEBACK & CALL OPTION Leaseback & Call Option of High Security Water Entitlements This long-term water lease will increase the Company’s annualised leasing revenue stream by $1.4 million from 1 July 2023 (once settled). Water Entitlement Lease & Call Option Leaseback of 3,815 meg
Slide 10: Non-Renounceable Entitlement Offer (Partially Underwritten)
NON-RENOUNCEABLE ENTITLEMENT OFFER Non-Renounceable Entitlement Offer (Partially Underwritten) The Company is pleased to invite existing Eligible Shareholders to participate in a 1:4 Non-Renounceable Entitlement Offer. Funds raised from the Entitlement Offer will be used to finance (partially or in
Slide 11: D2O Successfully Completes a $7.25 Million Underwritten Institutional Placement
INSTITUTIONAL PLACEMENT D2O Successfully Completes a $7.25 Million Underwritten Institutional Placement The Company is pleased to have received firm commitments from a range of institutional and sophisticated investors seeking to gain investment exposure to a defensive and alternative asset class. I
Slide 12: Bonus Option Issue to all Eligible Shareholders
BONUS OPTION ISSUE Bonus Option Issue to all Eligible Shareholders All Eligible Shareholders to receive a free Bonus Option (1:4), expiry of 10 May 2025, strike price of $1.92. Bonus Option holders will have an ability to purchase additional shares in the Company at $1.92 per share, until the Bonus
Slide 13: Proforma Balance Sheet
PROFORMA BALANCE SHEET Proforma Balance Sheet Pre-Transaction Acquisition, Post-Transaction Pre-Transaction Acquisition, Post-Transaction 31 May 2023 Entitlement Offer, 31 May 2023 31 May 2023 Entitlement Offer, 31 May 2023 Period1 Period1 (unaudited) & Placement2 (unaudited) (unaudited) & Placement
Slide 14: Proforma Water Portfolio Changes
PROFORMA WATER PORTFOLIO CHANGES Proforma Water Portfolio Changes The addition of these assets will add value and complement D2O’s existing water entitlement portfolio. • Increase water entitlement portfolio size by $41 million (11% increase by value) through this transaction. Increase leasing reven
Slide 15: Proforma Water Portfolio Changes
PROFORMA WATER PORTFOLIO CHANGES Proforma Water Portfolio Changes WATER PORTFOLIO WATER SECURITY ENTITLEMENT VALUE DIVERSIFICATION BREAKDOWN BY REGION Portfolio Statistics Pre-Transaction 31 May 2023 Portfolio Statistics Post-Transaction 1 31 May 2023 15 Duxton Water Limited | Acquisition & Capital
Slide 16: Summary
Summary 1. This acquisition represents a significant growth opportunity for Duxton Water Limited as it looks to scale its portfolio to support the needs of the Australian farming community. 2. This type of transaction enables Australian farming businesses to release capital from their balance sheets
Slide 17: Key Contacts
ACQUISITION, LEASEBACK, & CAPITAL RAISE Key Contacts The drierThe driersuggest outlook outlook by suggest rain and temperature rain and temperature by the the ENSO, forecasts. is ENSO, forecasts. is also supported also supported by sthe by the BOM’ BOM’s expected expected long-term long-term Sam Ven
Slide 18: duxtonwater.com.au
Duxton Water Limited 7 Pomona Road, Stirling SA 5152 +61 8 8130 9500 enquiries@duxtonwater.com.au duxtonwater.com.au
Slide 19: Key Terms of the Acquisition, Leaseback & Call Option with TWE
APPENDIX: KEY TERMS Key Terms of the Acquisition, Leaseback & Call Option with TWE Acquisition of 4,770 megalitres of high-security water entitlements for total consideration of $39.1 million: • NSW Zone 11 High Security – 2,799 megalitres (below choke Murray) • VIC Zone 7 High Reliability – 1,971 m
Slide 20: Key Risks
APPENDIX: KEY RISKS Key Risks Company Specific Risks In addition to potential control impacts set out in Section 3.9, Shareholders should note that if they do not participate in the Offer, their holdings are likely to be diluted by Potential for dilution approximately 20% (as compared to their holdi
Slide 21: Key Risks
APPENDIX: KEY RISKS Key Risks Company Specific Risks (cont.) The Company’s financial performance is subject to counterparties continuing to fulfil their obligations under various contracts. The Company anticipates many of its Water Key lessee risks and other Entitlements will be subject to long-term
Slide 22: Key Risks
APPENDIX: KEY RISKS Key Risks Industry Specific Risks Government buy-back The Australian Government’s Murray-Darling Basin (MDB) Plan (MDB Plan) involves a water buy-back program in order to address the environmental sustainability of the MDB. This buy-back program involves the Australian Government
Slide 23: Key Risks
APPENDIX: KEY RISKS Key Risks Industry Specific Risks (cont.) The demand for water is significantly dependent on the water use of the Australian agricultural industry. The Company’s performance is exposed to a number of underlying Australian agriculture and agricultural commodity prices. Any adverse
Slide 24: Key Risks
APPENDIX: KEY RISKS Key Risks Industry Specific Risks (cont.) The Investment Manager may elect that Water Allocations, which have not been leased, be carried over from one year to the next where permissible based on the jurisdiction Loss of carryover and Water Entitlement class. This strategy may be
Slide 25: Key Risks
APPENDIX: KEY RISKS Key Risks General Risks Additional requirements for The Company’s capital requirements depend on numerous factors. The Company may require further financing in addition to the amounts raised under the Offer. Any capital additional equity financing will dilute shareholdings, and d
Slide 26: Key Risks
APPENDIX: KEY RISKS Key Risks General Risks (cont.) The acquisition and disposal of Shares will have tax consequences, which will differ depending on the individual financial affairs of each investor. All potential investors in the Taxation Company are urged to obtain independent financial advice ab
Slide 27: About Duxton Water (ASX:D2O)
APPENDIX:ABOUT DUXTON WATER (ASX:D2O) About Duxton Water (ASX:D2O) Australia’s only ASX listed pure water investment opportunity. Key Metrics 31 May 2023 Share Price $1.67 Market Capitalisation $197 million Duxton Water Limited provides investors with a Shares on Issue 117,948,814 direct and pure ex
Slide 28: D2O Performance Since Inception
APPENDIX:D2O PERFORMANCE SINCE INCEPTION D2O Performance Since Inception Water is a defensive asset class with a proven track record of strong performance, even in tough economic conditions. NAV VS SHARE PRICE (TO 31 MAY 2023) $2.10 1. Water is a unique asset class that exhibits low to negative corr
Slide 29: Macro Driver 1: Increasing Demand for Water
APPENDIX:MACRO DRIVERS Macro Driver 1: Increasing Demand for Water Permanent crops continue to be planted in the Murray Darling Basin, adding to the long-term demand for Australian water assets. Australian Almond Industry Growth Permanent Crops 65,000 900,000 • Any crop that is harvested from a plan
Slide 30: Macro Driver 2: Decreasing Supply of Water
APPENDIX:MACRO DRIVERS Macro Driver 2: Decreasing Supply of Water The Australian Government is committed to delivering the Basin Plan in full. Government Buybacks Water Requirements of Permanent Horticulture in the Lower Murray Region 2 • Water licences on issue are capped. • Water licences on issue
Slide 31: Low Correlation to Traditional Asset Classes
APPENDIX: LOW CORRELATION Low Correlation to Traditional Asset Classes Long-term correlation matrix (10+ years)1 Water Index D2O Market Indices Correlation (AEI) Shares ASX 200 -0.13 0.11 Aus Equities All Ords -0.13 0.12 Water returns, measured by the Aither Entitlement Index has S&P 500 -0.09 -0.09