Announcement PDF Energy Technologies Limited (ASX:EGY) Investor Presentation Important Notice & Disclaimer This presentation has been prepared by Energy Technologies Limited (EGY or the Company). It should not be considered as an offer or invitation to subscribe for, or purchase any shares in EGY, or as an inducement to purchase any shares in EGY. No agreement to subscribe for securities in EGY will be entered into on the basis of this presentation or any information, opinions or conclusions expressed in the course of this presentation. This presentation is not a prospectus, product disclosure document, or other offering document under Australian law or under the law of any other jurisdiction. It has been prepared for information purposes only. This presentation contains general summary information and does not take into account the investment objectives, financial situation and particular needs of an individual investor. It is not a financial product advice and the Company is not licensed to, and does not provide, financial advice. This presentation may contain forward-looking statements which are identified by words such as ‘may’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, or ‘intends’ and other similar words that involve risks and uncertainties. These statements are based on an assessment of past and present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this presentation, are expected to take place. Such forward-looking statements do not guarantee of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors many of which are beyond the control of the Company, its Directors and management. Although the Company believes that the expectations reflected in the forward looking statements included in this presentation are reasonable, none of the Company, its Directors or officers can give, or gives, any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this document will actually occur or that the assumptions on which those statements are based are exhaustive or will prove to be correct beyond the date of its making. Readers are cautioned not to place undue reliance on these forward-looking statements. Except to the extent required by law, the Company has no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this presentation. Readers should make their own independent assessment of the information and take their own independent professional advice in relation to the information and any proposed action to be taken on the basis of the information. To the maximum extent permitted by law, the Company and its professional advisors and their related bodies corporate, affiliates and each of their respective directors, officers, management, employees, advisers and agents and any other person involved in the preparation of this presentation disclaim all liability and responsibility (including without limitation and liability arising from fault or negligence) for any direct or indirect loss or damage which may arise or be suffered through use of or reliance on anything contained in, or omitted from, this presentation. Neither the Company nor its advisors have any responsibility or obligation to update this presentation or inform the reader of any matter arising or coming to their notice after the date of this presentation document which may affect any matter referred to in the presentation. Bambach Wires and Cables • We specialize in providing high-quality electrical cables for a wide range of applications across the Low Voltage (LV), Medium Voltage (MV), and High Voltage (HV) markets. Our comprehensive product offerings cater to diverse industries, with a particular focus on Infrastructure, Renewables, Defence, and Mining sectors. • Founded in 1936, it is the oldest existing Australian cable manufacturer and 100% owned by Energy Technologies since 2012 • Factory in Rosedale, VIC with sales offices in New South Wales, Western Australia and Victoria • Blue Chip customer base across Rail and Road, Mining, Construction, Defence and Power and Energy Established in 1936, Bambach Wires & Cables is an Australian Owned and Operated Low Voltage Cable Manufacturer who have been servicing the Australian market for almost a century We pride ourselves on being Australian owned and operating as well as supporting local businesses as much as possible, therefore resulting in the vast majoring of our cables having over 90% local content. Bambach Wires and Cables EGY Overview: • Bambach has now completed the restructuring of the business. • The business is now well positioned to offer complete ranges of product groups & solutions into multiple key market segments, via the distribution agreements recently announced and strategic supply lines now secured. • Factory will continue to manufacture higher margin product lines. Restructured Business: • Distribution agreements in market segments with strong tailwinds e.g. utility scale solar farms (the recently announced Gantner agreement, allows the business to offer not only cables, but also control & monitoring equipment as well as hardware & software used in all utility scale solar farms), offshore & onshore wind power generation cables & distribution transmission lines, including subsea transmission cables. Purchased sales: • Strategic supply lines have been identified with manufacturers in Turkey, Malaysia & Europe. Factory: • The factory will continue to manufacture with a focus on higher margin cables only, substituting lower margin cables via purchased sales. Bambach Wires and Cables Gantner Distribution Agreement It is expected that utility scale solar farms will increase to $6bn annual spend over the coming 10 years. This is split into 3 stages: • Initial surge & expansion (2024-2026)estimated annual spend 2.5-3.5bn The company expects that during this stage, we introduce the Gantner range of products, alongside cables into new projects as a “complete solution”. This provides EPC firms with a significant advantage in piecing together a total package from one supplier with the technical backing to deliver & support long term. • Accelerated Growth Phase (2027-2029) estimated annual spend 3.5-5bn The company expects that at this stage its products & services will be an embedded part of many operational projects. It is expected that during this stage our previously delivered references will facilitate further growth. • Mature Market Phase (2030-2034) estimated annual spend 4.5-6bn The company expects growth will plateau at this stage. Continual expansion & optimisation of existing projects with Gantner product already online, will provide some growth. Products Offered Weather (Meteo) stations DC Combiner Boxes AC Combiner Boxes Field Point Extensions Control & Data acquisition Communication Modules Data Loggers & PPC’s SCADA Webportal software         Sources: Australian Energy Market Operator (AEMO) Clean Energy Council (CEC) Industry reports and market analysis The Opportunity & Growing Products Offered 2024 – 2026 Initial Surge and Expansion 2027 – 2029 Accelerated Growth Phase 2030 – 2034 Mature Market Phase Estimated Annual Spend 2.5-3.5bn Estimated Annual Spend 3.5-5bn Estimated Annual Spend 4.5-6bn Key Drivers: Key Drivers: o Offering “complete solution” with Gantner and Bambach products o Continued expansion and optimization of existing solar farms o Continuing investments in new solar farm projects o Integration with energy storage and grid infrastructure o Federal and Stage Government incentives o Ongoing regulatory support and climate commitments o Initial phase of large-scale projects under development o Our product and services will be an embedded part of many operational projects https://assets.cleanenergycouncil.org.au/documents/resources/reports/clean-energy-australia/Clean-Energy-Australia-2024.pdf https://aemo.com.au/-/media/files/major-publications/isp/2024/2024-integrated-system-plan-isp.pdf?la=en Key Drivers: o Continued expansion and optimization of existing solar projects with Gantner products already online will provide some growth o Integration with energy storage and grid infrastructure o Ongoing regulatory support and climate commitments Weather (Meteo) stations DC Combiner Boxes AC Combiner Boxes Field Point Extensions Control & Data acquisition Communication Modules Data Loggers & PPC’s SCADA Webportal software         Bambach Wires and Cables Tratos Group Agreement About Tratos • With headquarters in Italy and with more than 50 years of experience in the cable industry, Tratos’ engineering expertise is behind the development of highly specialised products for a variety of sectors. • From cabling for transport networks to fusion for energy projects of world significance, Tratos’ technology is at the forefront of the world’s most significant power, growth and connectivity projects. • • This strategic distribution agreement allows the business to complete its product offering into the renewable energy sector, with the addition of medium & high voltage cables & overhead transmission line. Tratos also produces navel cables, particularly nuclear energy cables. In addition to renewable products, Tratos produce cables suited for the Australian mining sector. The company expects this will provide us an entry point into this established sector through expansion of its currently offered range via the Tratos product. Products Offered Medium Voltage Cables High voltage Cables Transmission & Distribution Cables Off Shore & On Shore Wind Turbine Cables Mining Cables Fibre Optical Cables Marine Cables Novel Cables (Nuclear Power) Subsea Transmission Cables          Bambach Wires and Cables Manufacturing and Sales Manufactured & Purchased Sales: • Traditionally the company would manufacture all cables, often resulting in poor sales margins & ultimately a strain on cashflow due to low margin work through the pandemic and resulting in inefficient utilisation rates at the factory. • The company will now purchase product for sales in instances where sales margin is below 23%. This will ensure sales margins from the factory are locked & cash management is protected. • The company has a number of strategic alliances with numerous manufacturers throughout Turkey, Malaysia & Europe to name a few. These suppliers have all been rigorously vetted & quality tested • All products with a margin greater than 23% will continue to be produced through the factory. Financials – FY25 o Cost savings: $1.1m o Manufactured Sales: >$14.5m (Margin >23%) o Current Order Book: $2.3m FY25: Forecast: $26.2m o Purchased Sales: $6.7m Projected Revenue Mix • Distribution Agreements (Gantner) – Typically project driven. Size of projects range from $1.7m to $3.85m. Current tenders – 1 • Distribution Agreements (Tratos) – Typically purchase orders. Size of orders range from $150k to $750k • Manufacturing and Purchased Sales – Day to day purchase orders ranging up to $150k. Order Book $2.85m with order book margin >30% Project Driven. Size of projects range from $1m to $3.85. Current tenders – 2 o Distribution Agreement Sales: $5m o Focus on debt management Bambach Wire and Cables Manufactured Sales Purchased Sales Wholesale Distribution • Project sales focused on Rail, Road and Infrastructure will be a mix of manufactured high gross margin product (>35%) and low margin Purchased Sales to create and showcase both a competitive tender and evidence of speciality • Broad target market with emphasis in Construction and Mining • Distribution agreements identified and sought for well established brands in Australia • Contract sales focused on Rail, Road, Infrastructure and Energy (Renewables) will be short run specialised product with short delivery times (>30%) • Proprietary specialised product sold through the sales channels (>23%) • FY25 expectations - $14.5m • Value add processes at the factory level to manage end margins • Commoditised product margin expected to be 16% • Value add product margin expected to be >23% • FY25 expectations - $6.7m • Used to fast track Purchased sales division growth • Margin expected to be ~16% depending on the size, working cap agreements and brand name • Opportunity to provide central and branch warehousing of product at Rosedale and branches adding extra revenue opportunity • FY25 expectations - $5.7m Equity Raising – Overview Offer Structure and Size EGY is seeking to raise A$12.7 million via the issuance of up to approximately 422.1 million fully paid ordinary shares (New Shares) through a 1 for 1 non-renounceable pro rata entitlement offer Offer Price The offer will be conducted at A$0.03 per New Share representing a: • 14.3% discount to the last traded price of A$0.035 as at 11 September 2024 • 14.3% discount to the 10-day VWAP of A$0.035 as at and including 11 September 2024 • 7.7% discount to TERP of A$0.033 Retail Entitlement Offer The Retail Entitlement Offer will open on Friday, 20 September 2024, and close at 5:00pm on Wednesday, 2 October 2024. Eligible existing retail shareholders in Australia and New Zealand can apply for additional New Shares (Additional New Shares) under a top-up facility (Top-Up Facility) (subject to scale back at the Company's discretion). There can be no guarantee that there will be any allocation of Additional New Shares under the Top-Up Facility. Ranking Entitlement Offer Shares will rank equally with existing fully paid ordinary shares on issue Lead Manager Shaw and Partners Limited Equity Raising – Sources and Uses Sources A$m Entitlement offer 12.7 Total Sources 12.7 Uses A$m Reduce debt 6.6 Expand EGY's sales division 0.5 General working capital 4.9 Costs of the offer1 0.7 Total Sources 12.7 Notes: (1) Assuming A$12.7m offer size Equity Raising – Timetable Event Announcement of Offer Record Date for Offer Date Thursday, 12 September 2024 7.00pm on Tuesday, 17 September 2024 Offer Booklet sent to Eligible Shareholders Friday, 20 September 2024 Offer opens (Opening Date) Friday, 20 September 2024 Offer closes (Closing Date) 5.00pm on Wednesday, 2 October 2024 Announcement of results of Offer Before 12.00pm on Wednesday, 9 October 2024 Allotment of Shares issued under the Offer Wednesday, 9 October 2024 Trading of New Shares (on a normal settlement basis) starts Thursday, 10 October 2024