Nickel Asia Corp. · PSE:NIKL
Nickel Asia — Investor Presentation (September 2024)
31 slides from Nickel Asia's investor presentation, September 2024
Slide 1: Investor Presentation
NICKEL ASIA CORP. INVESTOR PRESENTATION
Slide 2: NIKL at a Glance
NIKL AT A GLANCE Largest nickel producer in the Philippines and one of the largest in the world A forerunner in the renewable energy space with 172 MW operating capacity Part of the PSE index Net Zero Target by 2050
Slide 3: Nickel Class Divide
NICKEL CLASS DIVIDE CLASS 2 surplus persists Transition to EVs CLASS 1 MARKET is growing, but there are supply chain risks Nickel deficit is inevitable, which implies Ni price upside Transition to clean energy in the Philippines
Slide 4: Nickel Deficit Is Inevitable Beyond 2027
NICKEL DEFICIT IS INEVITABLE BEYOND 2027 Our view: Upside to nickel prices given the inevitable scarcity of the commodity to fill the demand from stainless steel and NEV sectors. 1. Mass adoption of NEVs and increase in nickel demand will continue into the next decade 2. Nickel supply visibility bey
Slide 5: Philippine Supply Chain
PHILIPPINE SUPPLY CHAIN Ore Type Content Country Technology Product Used in Ni Ave: 1.40% NPI Fe: <25% (8% Ni) Saprolite China/Japan Electric 300 Series Furnace Stainless Steel Ni Ave: 0.9% NPI Fe: >40% (Below 2% Ni) China Blast Furnace 200 Series Limonite Stainless Steel Ni-Co Sulfide Ni Ave: 1.10%
Slide 6: Indonesian Supply Chain
INDONESIAN SUPPLY CHAIN Ore Type Content Country Technology Product Used in Ni Ave: 1.70% NPI Fe: <20% (12% Ni) 300 Series Saprolite Indonesia Electric Stainless Steel Furnace Ni Ave: 1.20% MHP Fe: >40% (~40% Ni) Limonite for Indonesia HPAL Battery HPAL Materials
Slide 7: Leading and Stable Mining Business
LEADING AND STABLE MINING BUSINESS One of the largest suppliers of lateritic nickel ore globally Stable long-term nickel ore output due to long remaining and the largest nickel ore producer in the Philippines life of mine Dinapigue, Bulanjao, and Manicani to ramp up in the coming years SOURCE: CRU,
Slide 8: Reserves and Mine Life
RESERVES AND MINE LIFE Nickel Asia has the largest nickel reserves and its mines have the longest mine life
Slide 9: The New Mines
THE NEW MINES DINAPIGUE BULANJAO MANICANI Total Resources as of 129 M WMT @ 1.12% Ni 56 M WMT @1.38% Ni 43 M WMT @1.59% Ni 12/31/2022 Saprolite resources 41 M WMT @ 1.35% Ni 20 WMT @ 1.54% Ni 25 M WMT @ 1.77% Ni Limonite Resources 88 WMT @ 1.02% Ni 36 WMT @ 1.30% Ni 18 M WMT @ 1.35% Ni Target Annual
Slide 10: Regulatory Updates
REGULATORY UPDATES Margin-based royalty rate not exceeding 5% of taxable income The Department of Finance (before corporate tax) for operations outside of mineral reservations 1 (DOF) proposes to simplify mining tax last March 7, 2024 NAC’s two mine sites, RTN and DMC will face additional royalty ta
Slide 11: Energy
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Slide 12: Philippine Shift to Renewable Energy
PHILIPPINE SHIFT TO KEY DRIVERS RENEWABLE ENERGY OF ELECTRICAL CONSUMPTION Macroeconomic recovery post-pandemic and strong population growth Government goal and supporting programs to accelerate and achieve 100% electrification by 2028, and energy sufficiency by 2030 At least 50% of electricity dema
Slide 13: Milestone Partnership with Shell
MILESTONE PARTNERSHIP WITH SHELL 86.29 NAC-Owned 40% On July 1, 2022, EPI and Shell signed a joint 60% Greenlight Renewables venture to jointly develop, own, operate, Holdings, Inc. Operating Entities: and maintain onshore renewables 1. 172-MW Jobi SQM projects in the Philippines 2. 145-MW Subic-Caw
Slide 14: Emerging Power, Inc. Solar Project Status
EMERGING POWER, INC. SOLAR PROJECT STATUS JSI Subic Cawag Leyte Project Botolan, Zambales Status Operating Construction in 4Q’24 Construction started in 2023 Construction in November 24 Completed in January Ongoing, Target completion: Pre-development Completed in June 2023 Completed in June 2023 202
Slide 15: Sustainability
A USTAI NABILITY WE KEL RS A COREE
Slide 16: NAC as a Leader of Responsible Mining in the Philippines
NAC AS A LEADER OF RESPONSIBLE MINING IN THE PHILIPPINES ASEAN MINERAL AWARDS Rio Tuba Best Practice - Mineral Mining Category Hinatuan 2nd Place - Best Practices in Distribution
Slide 17: ESG Score Improved to 34.8 from 43.7
ESG SCORE IMPROVED TO 34.8 FROM 43.7 NAC RATING REPORT The company is at high risk of experiencing ESG Risk ESG Risk ESG Risk Rating Contribution to Issue Name Exposure Score Management Score material financial impacts from ESG factors, due to 34.8 ESG Risk Rating Category Score Category Category it
Slide 18: Our Sustainability Performance
OUR SUSTAINABILITY Digital ESG Reporting and Automated Data Workflows NAC is transitioning to digital tools to optimize data collection, PERFORMANCE verification, and analysis. The digitalization and reporting efforts within the NAC Group will streamline operations, harness ESG is at the forefront o
Slide 19: NAC
NAC NICKEL ASIA CORP
Slide 20: Nickel Mining
NICKEL Revenues from ore sales declined by 16 MINING percent to P 7.79 billion from P 9.29 billion last year, due to lower ore prices 1 The group’s consolidated Earnings before interest, taxes, depreciation, and The company’s operating mines sold amortization (EBITDA) totaled P 2.96 billion against
Slide 21: Renewable Energy (EPI)
RENEWABLE EPI’s operating asset Jobin-SQM Inc. (JSI) is presently operating a total capacity of 172-MW with the new ENERGY (EPI) additional capacity achieved last February 28, 2024, from 100 MW YoY (began in July 2022); generation for 1 1H-24 is up to 54.4 YoY to 117,935-megawatt hours. Leyte Phase
Slide 22: Financial Highlights 1H-24 vs 1H-23
FINANCIAL HIGHLIGHTS 1H-24 VS 1H-23 2019 2020 2021 2022 2023 1H2024 1H2023 EBITDA Margin (1) 36% 43% 53% 51% 46% 32% 44% Net Income Margin 21% 26% 39% 38% 24% 19% 26% Ave. Ni LME price per pound (US$) 6.32 6.25 8.39 11.21 9.49 8.14 10.70 Ore Exports 23.52 33.99 40.40 39.39 30.59 21.95 28.81 Average
Slide 23: Shipment & Revenues by Ore Type
SHIPMENT & REVENUES BY ORE TYPE +4.9% YoY ore exports -24% YoY ore exports -16% YoY change in Total +1.8% YoY limo HPAL -37% YoY limo HPAL revenue -33% YoY change in limo HPAL revenues -7% YoY change in ore export revenues
Slide 24: Revenue Variance Analysis
REVENUE-VARIANCE ANALYSIS Sales Volume (in millions WMT) 1H2¢ Persea 16 14-23 7.51 Sales Price (in USD$ per WMT) FX Rate (PHP/USD) 14,000 M 12,000 M 10,000 M 8,000M 6,000 M 4,000 M 2,000 M OM Revenues 6M-2024 v 6M-2023 (in Php Millions) 1,780 M 10,922 M || 251M 300 M 29M Zo — — a (3,577 M) (414M) 6.
Slide 25: Cost & Expenses Variance Analysis
COST & EXPENSES VARIANCE ANALYSIS
Slide 26: Investment in Equity Earnings
INVESTMENT IN EQUITY EARNINGS The weaker YoY Nickel and Cobalt prices had further negatively impacted Equity losses from investments in the HPAL operations.
Slide 27: JSI Financial Highlights 1H-23 to 1H-24
JSI FINANCIAL HIGHLIGHTS 1H-23 TO 1H-24 1H-23 1H-24 YoY% change Generation (in MWh) 76,375 117,935 54.4% Due to energization of Phase 4A EBITDA (Php in Millions) 330.8 524.3 58.4% At par with revenue growth EBITDA Margin 84.69% 85.08% 39bps Within the 80-85% target range Weighted Realized Tariff (in
Slide 28: Annex
INNINT
Slide 29: Annex 1: Margin-Based Royalty Rate
ANNEX 1 MARGIN-BASED ROYALTY RATE Margin Rate 1% up to 10% 1.00% Current margin-based royalty rate Above 10% up to 20 % 1.50% not exceeding 5% of taxable Above 30% up to 40% 2.00% income (before corporate tax) for operations outside of mineral Above 40% up to 50% 2.50% reservations (Based on House B
Slide 30: Annex 2: Margin-Based Windfall Profits Tax
ANNEX 2 MARGIN-BASED WINDFALL PROFITS TAX Margin Rate More than 35% up to 40% 1.00% More than 40% up to 45% 2.00% More than 45% up to 50% 3.00% Current margin-based windfall More than 50 up to 55% 4.00% profits tax on mining operations More than 55% to 60% 5.00% assuming taxable income margin More t
Slide 31: Thank You