Syrah Resources Limited · ASX:SYR
Syrah Resources — Q1 2024 Earnings Presentation
31 slides from Syrah Resources's earnings presentation, Apr 30, 2024
Slide 1: Q1 2024 Quarterly Activities Report
Q1 2024 Quarterly Activities Report 30 April 2024 syrahresources.com.au Q1 2024 Quarterly Activities Report Syrah Resources | ASX: SYR1 30 April 2024
Slide 2: Important notice and disclaimer
Important notice and disclaimer This presentation is for information purposes only. Neither this presentation nor the information contained in it constitutes an offer, Investor Relations invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. Thi
Slide 3: Our Position
Our Position Syrah is a major ex-China natural graphite and active anode material (AAM) supplier for global customers, with upstream and downstream expansion potential underpinned by its world-class Balama resource Natural graphite and Syrah is the only Balama is an up to Ramping up AAM demand opera
Slide 4: Our ESG Profile
Our ESG Profile Leading ESG standards Best practice sustainability Low carbon footprint Auditable back to source frameworks ✓ ISO:45001 and ISO:14001 ✓ Sustainability frameworks guided ✓ Independent life cycle assessment ✓ Fully integrated by Syrah from certification at Balama by: (“LCA”) completed
Slide 5: Q1 2024 Key Milestones and Actions
Q1 2024 Key Milestones and Actions ✓ Commencement of Vidalia operations – first ex-China integrated natural graphite AAM facility at commercial scale ✓ Dispatched initial commercial-scale production samples to Tesla and other customers after quarter end ✓ POSCO Future M six-year offtake agreement fo
Slide 6: Q1 2024 Highlights
Q1 2024 Highlights Balama & Vidalia Market & Corporate Health & Safety – Balama recovery of 78% during operating – Global EV sales in Q1 2024 up 21% compared to Q1 2023 11 kt Balama production periods – ~US$4m per month Balama C1 fixed costs in to ~3.1 million units7 and volatile China anode product
Slide 7: Balama Production, Operations and Sales
Balama Production, Operations and Sales Plant operations and production in campaigns since Q2 2023 Natural Graphite Production (kt) Product Mix (% Fines) 41 91% 91% 88% 87% 86% 15 18 20 11 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 2023 2023 2023 2023 2024 2023 2023 2023 2023 2024 Plant Recovery C1 Costs (US$/t1
Slide 8: Market and Supply Chain Update
Market and Supply Chain Update ▪ Continued disruption and uncertainty in global natural graphite and anode material markets with the Chinese Government export licence controls implemented from 1 December 2023 for designated graphite and anode products ▪ China exports of impacted graphite products we
Slide 9: Volatile China anode production in Q1 2024
Volatile China anode production in Q1 2024 Global Monthly EV Sales (‘000 Units)1 China Monthly Anode Production (kt)2 1,800 Q1 2024 EV Sales 200 Q1 2024 Chinese Anode Production 1,600 +21% on Q1 2023 180 160 +17% on Q1 2023 1,400 +22% 140 1,200 120 1,000 +50% 100 -2% 800 80 600 60 400 40 200 20 0 0
Slide 10: Short-term conditions remain challenging
Short-term conditions remain challenging China Anode Production vs. Anode Capacity Utilisation1 China Natural Graphite Production vs. China Anode Production1 200 110% 200 100% 160 160 90% 120 80% 120 80 70% 80 60% 40 50% 40 0 40% Jul-21 Jul-22 Jul-23 Jan-22 Nov-23 Jan-21 Nov-21 Nov-22 Jan-23 Jan-24
Slide 11: China graphite controls immediately impacted ex-China market
China graphite controls immediately impacted ex-China market Export volumes for purified spherical graphite and finished AAM returned to normalised monthly levels in March 2024 China natural graphite exports (kt) China spherical graphite exports (kt) China natural graphite AAM exports (kt) 140 70 Ja
Slide 12: Syrah Market Position
Syrah Market Position Q1 2024 Quarterly Activities Report 12
Slide 13: Syrah can capitalise on a graphite market in structural flux
Syrah can capitalise on a graphite market in structural flux Geopolitical and commercial developments in graphite and AAM drive increased opportunities for Syrah margin and volume Market developments Syrah advantages Attractive graphite market outlook relative to other battery Long-term, large scale
Slide 14: Syrah leads ex-China industry in development and operations
Syrah leads ex-China industry in development and operations >8 years advanced on ex-China peers, with >US$700m of investment to date in development, operations, product qualification and commercial sales; deep operating experience Balama Bankable feasibility study Construction and +2 years commissio
Slide 15: Ex-China market size and growth opportunity for Syrah is clear
Ex-China market size and growth opportunity for Syrah is clear Syrah’s existing and planned production capacities represent only a fraction of the opportunity in the ex-China addressable market – lead time advantage creates further opportunity Ex-China natural graphite Natural graphite AAM for ex-Ch
Slide 16: Syrah is a global vertically integrated graphite supplier
Syrah is a global vertically integrated graphite supplier Additional AAM capacity development strategy Balama Natural Graphite Offtake and Marketing Strategy Syrah aims to become a leading supplier Vidalia AAM Facility Geographic diversification in Balama natural graphite sales to AAM and battery ma
Slide 17: Syrah fundamentally changing Balama sales composition
Syrah fundamentally changing Balama sales composition Driving toward higher and more stable utilisation of Balama’s production capacity Balama natural graphite Balama natural graphite Target Balama natural graphite sales composition (2022) sales composition (2023) sales composition (2026) 1 Ex-China
Slide 18: Balama is the premier graphite resource and operation
Balama is the premier graphite resource and operation Ex-China natural graphite reserves and reserve grade1 Balama operating costs (US$/t FOB) at different production rates BALAMA 25 CUT-OFF 10kt 15kt 20kt 25kt ~30kt GRADE2 Africa per month per month per month per month per month 800 North America 2
Slide 19: Balama's infrastructure in place and optimised over six years
Balama’s infrastructure in place and optimised over six years Process plant, product Ativa pit warehouse and ROM stockpiles Tailings 11.25 MWp storage solar facility photovoltaic (cells array 1 & 2) Q1 2024 Quarterly Activities Report 19
Slide 20: Vidalia is the cornerstone of Syrah's downstream business
Vidalia is the cornerstone of Syrah’s downstream business Downstream expansion is underpinned by Balama’s world-class resource Vidalia, USA Asia (ex-China) Joint Venture / Tolling (>20ktpa) Technology Support to 3rd Party (ex-China) Partners (>50ktpa) Europe Joint Ventures (>20ktpa) Production Base
Slide 21: 11.25ktpa AAM Vidalia facility commenced production in February 2024
11.25ktpa AAM Vidalia facility commenced production in February 2024 Milling Purification area area Land for Vidalia Further Expansion to 45ktpa AAM 11.25ktpa AAM facility 11.25ktpa (milling area) AAM facility (furnace area) Furnace Aerial area view 11.25ktpa AAM facility (purification area) Q1 2024
Slide 22: Vidalia economics attractive – built on cost and price experience
Vidalia economics attractive – built on cost and price experience Potential for significant margin upside as new project inducement drives marginal pricing Economics of Vidalia facility (45ktpa AAM capacity)1 Long-term natural graphite AAM price assumption (US$/kg)3 $11.88 2023 high AAM price US$5.0
Slide 23: Syrah's ESG position provides lower emissions & traceability
Syrah’s ESG position provides lower emissions & traceability Global Warming Potential of graphite products (kg CO2 eqv./kg product)1 Syrah Major Chinese ESG element (as proxy for ex-China suppliers) suppliers Vidalia AAM 7.3 >3x ~2x IRMA5 independent Chinese natural graphite AAM 14.2 Responsible Min
Slide 24: Syrah's incumbent position can embed key advantages
Syrah’s incumbent position can embed key advantages New ex-China demand, low alternative supply; upstream natural graphite and downstream AAM operations Syrah’s opportunity Stakeholders and customers Customer driven product Transition to higher margin motivated to underpin further iteration and gove
Slide 25: Syrah's 2024 targets embedding unique advantages
Syrah’s 2024 targets embedding unique advantages Recent milestones 2024 targets Capital Structure Dec-21 – Binding offtake agreement with Tesla for the supply of natural graphite AAM from Vidalia Jul-22 – Received a US$102m binding loan from US DOE for the initial expansion of Vidalia Commercial a
Slide 26: Our Valuation Proposition
Our Valuation Proposition Syrah is leading ex-China natural graphite and anode material production capacity and sales growth Vertical Operating and Cost Position ESG Position Expansion Integration Development Potential ▪ Natural graphite ▪ Largest integrated ▪ Cost competitive ▪ Leading ESG ▪ Signif
Slide 27: Appendix
Appendix Q1 2024 Quarterly Activities Report 27
Slide 28: Battery and natural graphite fines demand in early stages of growth
Battery and natural graphite fines (-100mesh) demand is in the early stages of growth – driven by EV adoption Global EV Sales (Millions) Lithium-ion Battery Capacity (GWh) Natural Graphite Demand (kt) 120 90% 9,000 9,000 80% 8,000 8,000 100 70% 7,000 7,000 80 60% 6,000 6,000 50% 5,000 5,000 60 40% 4
Slide 29: Graphite is a high intensity material in EV batteries
Graphite is a high intensity material in EV batteries, with costs / emissions expected to drive shift towards natural graphite Battery Mineral Composition of Batteries1 Natural Graphite Demand for Batteries2 100% 2023 Other Silicon 0% 5% Natural 26% Metal Composition % Mass Synthetic 68% 2040 LTO Ot
Slide 30: US Inflation Reduction Act Section 30D credits
US Inflation Reduction Act Section 30D credits FEOC in the critical minerals supply chain? AAM supply Ore extraction and Spherical graphite and routes concentration purification processing Finished AAM Section 30D EV tax credit Extraction or processing facilities located or companies in a FEOC cover
Slide 31: Syrah's global business to supply growing battery anode demand
Syrah’s global business to supply growing battery anode demand Vidalia, Louisiana, USA Balama, Cabo Delgado Province, Mozambique Sales and Marketing Hub, Dubai, UAE Contract Sales Liaison, Shanghai, China Corporate Office, Melbourne, Australia Q1 2024 Quarterly Activities Report 31