Cadence Minerals Plc · LSE:KDNC
Cadence Minerals — Investor Presentation (April 2018)
28 slides from Cadence Minerals's investor presentation, April 2018
Slide 1: Investing and Developing Minerals that Power Tomorrow's Needs
Investing and Developing Minerals that Power Tomorrow’s Needs April 2018
Slide 2: Disclaimer
DISCLAIMER This presentation and any additional documents handed out at any meeting (together the “Presentation Materials”) have not been approved by (i) the London Stock Exchange plc or by any authority which could be a competent authority for the purposes of the Prospectus Directive (Directive 200
Slide 3: Strategy: Invest & Develop World Class Assets in Battery Minerals
STRATEGY Invest & Develop - World Class Assets In Battery Minerals Sector (Lithium, Rare Earths & Cobalt) • Unique early investment strategy & development firm within the battery mineral resource sector • Identify undervalued assets with irreplaceable strategic advantages • We invest in them and hel
Slide 4: Strategy & Key Investments
STRATEGY & KEY INVESTMENTS EUROPEAN METALS HOLDINGS – 20% KEY • Definitive Feasibility Study 2018 PUBLIC LISTED INVESTMENTS – XX % • Planned Production of 20,800 tpa Lithium DIRECT PROJECT INVESTMENTS – XX % Carbonate Production • US$ 540 M NPV 2 3 AUROCH MINERALS – 7% • Arden Project – Cobalt Yangi
Slide 5: Value Proposition
VALUE PROPOSITION Investment Value Return Potential Growth £ 15 million £ 33 million 121% Feasibility study on Bacanora Minerals yielded a US$1.25 Direct billion discount cash flows (NPV8). Project £ 4 million £ 8* million 125% Cadence Joint Venture (Mexalit) share of (NPV8) US$90 Investments millio
Slide 6: Why Lithium?
Why Lithium?
Slide 7: The horse is here to stay but the automobile is only a novelty
“The horse is here to stay but the automobile is only a novelty — a fad.” President of the Michigan Savings Bank advising Henry Ford’s lawyer, Horace Rackham, not to invest in the Ford Motor Company. 5th AVE NYC - 1900 5th AVE NYC - 1913 7 CORPORATE PRESENTATION APRIL 2018
Slide 8: "Expert" Disruption Forecasts
“Expert” Disruption Forecasts AT&T hired Mckinsey & Co to forecast cell phone adoption by the year 2000 Their (15-Year) prediction 900,000 subscribers They were off 120x by a factor of The actual number for 2000 was 109,000,000 subscribers 8 CORPORATE PRESENTATION APRIL 2018
Slide 9: Electric Vehicles Are a Disruptive Technology
ELECTRIC VEHICLES (EV’s) ARE A DISRUPTIVE TECHNOLOGY • EV’s are 5x – more efficient (95%) – ICE 20% When you see a 10x economic improvement, • EV’s are 5x to 10x – cheaper to fuel / charge disruption on incumbent technology / business EV’s are 10x – cheaper to maintain (10X less moving parts) models
Slide 10: Electric Vehicle Forecasts
ELECTRIC VEHICLE FORECASTS 30 Citi Liberium 23% Penetration on new car sales Morning Star UBS (Upside) 25 million new electric vehicles per year 25 EV SALES PER YEAR 20 MILLIONS 15 10 5 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 CORPORATE PRESENTATION APRIL 2018
Slide 11: Why Lithium, Rare Earths & Cobalt
WHY LITHIUM, RARE EARTHS &COBALT • Scarce – Although ample mineral resources they have not been developed to meet the forecast demand • No Replacements – Lithium, Rare Earth and to a lesser extend cobalt have no complete replacements • Disruptive Technology - will drive demand not a “cycle”, created
Slide 12: Capital Is Flowing to the Lithium Ion Battery Sector
CAPITAL IS FLOWING TO THE LITHIUM ION BATTERY SECTOR • 9 x Increase in planned 400 +121 GWh Gigawatt hour capacity in 20178 (GWh) 350 • 340 GWh = US$ 34 billion 300 in capital investments 121 • Forecasts would suggest in +149 GWh excess of 709 GWh required 250 in 20168 by 2025. GWH 200 150 149 149 +
Slide 13: Lithium - Supply to Remain Constrained
LITHIUM - SUPPLY TO REMAIN CONSTRAINED 1,200,000 Pre-Feasibility Projects Feasibility Projects Under Construction Current Production Demand 1,000,000 DEMAND Tonne of Lithium Carbonate Equivalent 800,000 600,000 400,000 SUPPLY 200,000 - 2018 2019 2020 2021 2022 2023 2024 2025 13 CORPORATE PRESENTATIO
Slide 14: Lithium Pricing Remains Strong
LITHIUM PRICING REMAINS STRONG Our investments use US$10,000 to US$11,000 per tonne of lithium carbonate for revenue calculations substantially below current prices 14 CORPORATE PRESENTATION APRIL 2018
Slide 15: Public Listed Investments
Public Listed Investments Investment Value Return Potential Growth Pre feasibility study –EMH (NPV8) US$540 million Public Listed Feasibility study – BCN –(NPV8) US$1.25 billion £11 million £ 25 million 119% Investments Based on a diluted equity position Cadence equity value in these two assets pote
Slide 16: Performance of Cadence Public Listed Investments
PERFORMANCE OF CADENCE PUBLIC LISTED INVESTMENTS Absolute 2016 2017 Cumulative Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Returns 17.9% 97.4% 65.9% 36.5% 130.1% 72.2% 110.1% 119.2% 600.00 500.00 400.00 Rebased lithium 300.00 Index and P&L of Cadence to 100 200.00 100.00 - 04-Aug-16 04-Aug-17 04-Jun-16 04-Jun-17 04-Feb
Slide 17: Public Listed Investments
PUBLIC LISTED INVESTMENTS EUROPEAN METALS HOLDINGS – 20% • Definitive Feasibility Study 2018 • Planned Production of 20,800 tpa Lithium Carbonate Production • US$ 540 M NPV 2 3 AUROCH MINERALS – 8% • Arden Project – Cobalt 6 MACARTHUR MINERALS – 15% • Various projects in Australia BACANORA MINERALS
Slide 18: Key Investments
KEY INVESTMENTS Globally significant lithium projects Size: both of this investments represent two of the four largest non brine deposits in the world. Low Cost: these assets have operational costs that are in the lower half of the cost curve Location: assets are strategically located to serve the m
Slide 19: Low Cost - Peer Comparisons
LOW COST– PEER COMPARISONS $7,000 Chinese Brines Australian Minerals $6,000 Orocobre $5,000 FMC Lithium Cost per tonne of LCE mined European Metals Holdings Bacanora Minerals $4,000 Albermarle SQM $3,000 Cadence Investments $2,000 $1,000 $- 0 50,000 100,000 150,000 200,000 Cumulative Annual Producti
Slide 20: Location - European Metals Holdings (20%)
LOCATION - EUROPEAN METALS HOLDINGS (20%) At the Heart of New European Demand Plans to build 2-3 million EVs per year & release 30 new models by 2025. Reports of EUR 10bn battery factory in Leipzig - 150kms from Cinovec EUR 1bn EV program, headquarters in Stuttgart & factory in Leipzig. Confirmed to
Slide 21: Direct Project Investments
Direct Project Investments Investment Value Return Potential Growth Direct Feasibility study on Bacanora Minerals yielded a US$1.25 billion discount cash flows (NPV8). Project £ 4 million £ 8* million 125% Cadence Joint Venture (Mexalit) share of (NPV8) US$90 Investments million (Cadence share 30% -
Slide 22: Strategy & Key Investments
STRATEGY & KEY INVESTMENTS Mexalit JV – 30% • Construction 2018 • Building to a 35,000 tpa Lithium Carbonate Production • US$ 1.25 B NPV 3 Yangibana Rare Earth Deposit – 30% San Luis Lithium Project – Earn In Upto 100% 4 • 55,793 Hectares Exploration Applications • Prime exploration area for lithium
Slide 23: San Luis Lithium Prospects
SAN LUIS LITHIUM PROSPECTS President Mauricio Marci has HSBC estimates Argentina will removed the 5% tax on lithium contribute 17% of 2016 global exports and is improving the supply that should increase to regulatory structure of the 23% by 2025 lithium industry Six prime assets in San Luis Province
Slide 24: San Luis Lithium Prospects: Plan for 2018
SAN LUIS LITHIUM PROSPECTS Plan for 2018 Q1 - 2018 Remote Q2 – 2018 Spodumene H2 – 2018 Drilling prospecting programme to sampling programme over programme target define identify spodumene pegmatite fields* mineral resource* bearing pegmatites* * Subject to grant of required licenses & permits - Q1
Slide 25: San Luis Lithium Prospects: Potential Upside
SAN LUIS LITHIUM PROSPECTS Potential Upside Hard Rock – EV / Resource Valuation (US$/t LCE) Finding the right asset has the $1,200 $1,094 potential to add substantial value. $1,000 For example – 25 million tonnes @ EV / Resource (US$ / t LCE ) $800 1.20% Li2O =750Kt LCE $584 $582 $600 $556 $471 or c
Slide 26: Summary: Company Poised for Upside
SUMMARY COMPANY POISED FOR UPSIDE Investment Value Return Potential Growth £ 15 million £ 33 million 121% Feasibility study on Bacanora Minerals yielded a US$1.25 Direct Project billion discount cash flows (NPV8). £ 4 million £ 8* million 125% Cadence Joint Venture (Mexalit) share of (NPV8) US$90 In
Slide 27: The Team
THE TEAM Team with key engineering, technical, corporate and financial experience and skills. Donald Kiran Andrew Strang Morzaria Suckling FINANCE DIRECTOR CHIEF EXECUTIVE OFFICER EXECUTIVE CHAIRMAN In excess of 20 years finance experience. For the last decade Over 20 years in the Over 20 years in t
Slide 28: Contact / Disclaimer
CONTACT DISCLAIMER The investment mentioned in this document may not be suitable for all recipients or be appropriate for their personal circumstances. The information in this document is believed to be correct but cannot be guaranteed. Opinions constitute our judgment as of www.voxmarkets.co.uk/com
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