EDEN INNOVATIONS LTD - Interim / Quarterly Report 2021

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ASX Quarterly Report

For the Quarter Ended 31 December 2020

SALES DURING THE QUARTER

	Sales	Sales	Sales
	31 Dec 2020	31 Dec 2019	% Change
	A$000’s	A$000’s
EdenCrete®	459	306	50%
OptiBlend®	362	213	70%
Total	821	519	58%

COVID-19

During the quarter, Eden’s workforce remained free of COVID-19 infection. Since then, one employee contracted the virus and has now recovered but no other employees were affected. During the quarter Eden remained focused on preparing for resumption of normal business when disruptions ease, with our production running at full capacity (approximately 14 hours a day with shift work separation to prevent COVID 19 cases internally).

COVID 19 continues to delay sales, trials and projects that were underway or planned in various markets in USA and other countries.

President Biden – US Infrastructure

With President Biden now in office, based upon his pre-election undertakings in relation to increasing US infrastructure spending, Eden is hopeful that a significant increase in Federal funding for US infrastructure projects will deliver more infrastructure projects in which EdenCrete® products are used over the next four years.

Global Market Overview

Notwithstanding the ongoing impact of the COVID-19 pandemic across the world, sales of each of EdenCrete® products and OptiBlend® products continued to grow, with aggregate sales for the quarter being 58% higher than in the corresponding quarter of 2019 (i.e., before the start of the current pandemic). Further, the number of customers and geographic footprint for both product ranges have also continued to grow.

Eden Innovations Ltd | Telephone +61 8 9282 5889 Level 15, 197 St George’s Terrace, Perth, Western Australia 6000, Australia | edeninnovations.com

SUMMARY

EdenCrete®

US EdenCrete® Market Summary

Silent Partner International (SPI)
SPI advised that preliminary steps for the first project in West Virginia completed.
Design work underway and site work scheduled to commence in May 2021.

 Georgia market continuing to expand

GDOT/ FHWA Projects
Currently 7 GDOT highway repair projects underway or are pending (including 2 jointly funded with FHWA).
The largest of these current projects, the third GDOT/FHWA jointly funded project using EdenCrete on Interstate I-75/SR 401, has commenced and should use in excess of US$250,000 of EdenCrete® over next 6 months.
GDOT is planning a number of major highway upgrade projects
GSOT introduces more stringent mainline concrete paving specifications that incorporate performance specifications based around the performance achieved using EdenCrete®

o GPA Repair Projects

Highly successful field trials with GPA in early 2020 led to EdenCrete® been included by GPA in the specifications for two projects and used by a contractor in a third small repair contracts at the Port of Savannah.
Successful development of EdenCrete® enhanced concrete mix designs for use in a range of port, marine and coastal applications.

o Port of Savannah Expansion

EdenCrete® pre-approved by GPA for use in first project currently being tendered under US$2.5 billion doubling of capacity of the Port of Savannah.
If EdenCrete® is used, it would require approx. US$625,000 of EdenCrete®.
Bids close in early February 2021.

 Colorado market continuing to expand

Colorado Department of Transportation (CDOT) shotcrete project I-25 in Colorado Springs.
City of Denver Department of Transportation and Infrastructure completed positive review of long-term trial, resulting in EdenCrete® being included as an additional admixture in the specifications for specific new roadway paving and pavement repairs.
Concrete supplied for projects for both the City of Breckinridge and the City of Silverthorne.
Two new ready-mix customers added.
First volumetric concrete projects successfully completed.
CDOT I-70- Vail Pass EdenCrete® trial contract awarded; preliminary testing starts in Spring.
Kansas – first project in Wichita
EdenCrete® successfully used in Wichita- a large commercial project in a new US state, in a new application, and for a new contractor.
Trials in process with three new ready-mix customers in Wichita market.

Utah – two new shotcrete projects
Two projects completed in Salt Lake City being at a large mixed use commercial/ residential development and at a public All-Abilities Water Park that is also suitable for mentally and physically disabled customers.
Missouri, Arizona, Nevada, Montana
Trials scheduled over next six months in Kansas City, MO, Phoenix, AZ, Las Vegas, NV, and Helena, MO.

International EdenCrete® Market Summary

Australia
First significant Australian sale
After quarter, NICNAS approval received to import EdenCrete® into Australia for sale and use.
Europe
Large European construction company that started trialing EdenCrete® in July 2019 resumes its long term trials after a 10 months’ COVID-19 shutdown.
India
First Indian EdenCrete® sale to significant Indian construction company following highly successful trials in February 2020 and subsequent long COVID-19 shutdown.
After quarter, second large Indian construction company re-commenced EdenCrete® trials following similar successful trials in early 2020 and a long COVID-19 shutdown.
Israel
First significant Israeli sale following highly successful trials
South Korea
Ongoing trials continuing with major company (but significantly impacted by COVID-19 restrictions)

OptiBlend®

During the quarter Eden dramatically increased its OptiBlend® sales to approximately A$362,000, mainly as a result of a huge percentage increase in sales in India.

EdenPlast®

During the quarter Eden supplied a Japanese plastics manufacturer a master batch of carbon nanotube (CNT) enriched polymer that Eden had made using plain polymer supplied to it by the Japanese company, and blending 38% by weight of CNT into the polymer. The Japanese company, although impacted by COVID-19 has commenced trialing the EdenPlast® master batch.

Hydrogen

During the quarter Eden received preliminary enquiries from a number of companies related to possible collaboration with Eden in relation to its various hydrogen technologies and capabilities.
Eden is open to such a collaboration provided that it does not impact adversely on Eden’s other products and business activities and will continue to explore any opportunities that may arise.

Details

Silent Partner International Inc.

Silent Partner International (SPI) has advised that:

the general contractor has been engaged for the first data centre in West Virginia;
design work for this project will continue during the first few months of 2021; and
site work is scheduled to commence in May 2021.

As announced in the last quarterly report, Eden entered into a long-term contract to supply a total of up to US$48million worth of EdenCrete® products over an 8-year period, representing a major milestone in global rollout of EdenCrete® products.

Georgia

During the quarter sales of US$130,000 were recorded.

Georgia Department of Transportation (GDOT)/ Federal Highway Administration (FHWA) Projects

Currently 7 GDOT highway repair projects in Georgia are underway or are pending (including 2 jointly funded with FHWA) in which Eden anticipates that EdenCrete will be required. The largest of these current projects, the third GDOT/FHWA jointly funded project using EdenCrete®, involving the replacement of badly worn sections of concrete pavement along Interstate I-75/SR 401, has commenced. This project is projected to require in excess of US$250,000 worth of EdenCrete® over the next 6 months. The first two GDOT/ FHWA repair projects completed in 2019 and 2020 respectively, each ended being approximately 30-40% larger than originally estimated, as additional repair work was added.

Additionally, GDOT is planning a number of major highway upgrade projects in Georgia, including constructing additional lanes for trucks along major highways to relieve congestion. Some of these projects are proposed to be funded using Public Private Partnerships (PPP) between GDOT and commercial partners, where the commercial partner will take on extended maintenance obligations, often for more than 40 years. Eden is hopeful that EdenCrete® will be included in the concrete required for at least some of these major projects.

New GDOT Mainline Paving Specifications

During the quarter, GDOT introduced more stringent mainline concrete paving specifications that will apply to future mainline paving projects, and that incorporate higher performance specifications based upon the performance achieved using EdenCrete® in trials conducted by GDOT. These new specifications are considered likely to increase the number of future mainline concrete paving projects in which EdenCrete® is added.

Georgia Port Authority (GPA) Projects

Over the past several months, and following the highly successful field trials that took place with GPA in early 2020 (see Eden ASX announcement dated 7 February 2020), EdenCrete® has in recent months been included in three GPA small concrete repair projects, including being added by GPA to the specifications for two of these contracts and being included by a contractor in a third, in areas of the port that are exposed to harsh operating conditions and heavy wear.

Eden has also completed the development with a number of companies, of various EdenCrete® enhanced concrete mix designs for use in a range of port, marine and coastal applications.

Port of Savannah Expansion

EdenCrete® has now been expressly pre-approved by GPA for use in first project that is currently being tendered as the first project being undertaken in the 8-year, US$2.5 billion expansion project that will double the capacity of the Port of Savannah. Eden is currently engaging with all regional ready-mix suppliers and contractors to ensure they are aware of the earlier success of EdenCrete®. Based on the dosage rate used in the EdenCrete® trials, if EdenCrete® is used by the successful tenderer, the project would require approximately US$625,000 of EdenCrete®. Bids are scheduled to close in early February 2021. The first project is the re-alignment of Berth 1 to allow docking for more 14,000 TEU vessels on the downriver end of the terminal (see Figure 1.).

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Figure 1. Garden City Terminal

GPA announced in late 2019 a US$2.5 billion plan to double the annual capacity of the Port of Savannah. The volume of container traffic that the port (which is currently the third busiest US container port) can handle, is planned to be increased over the next 8-10 years from approximately 5.5 million TEU (Twenty Foot Equivalent Units) movements per year to 11 million TEU movements. This plan involves:

a major increase in the number of berths, cranes and the required areas of hardstand storage, together with a significant upgrade to the port’s rail and road networks to handle the increased volume of container traffic; and
expansion of the current 1,200-acre footprint at Garden City Terminal and the establishment of a new container port on Hutchinson Island, across the Savannah River channel.

By 2027, the additional cranes, revamped dock space and a new Hutchinson Island terminal are planned to allow the Port of Savannah to significantly increase big ship capacity of the port. In 2020 the terminal was scheduled to receive six additional Ship to Shore (STS) cranes (see Figure 2), and bring its fleet to 36, more than any other terminal in North America.

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Figure 2. Some of the ship-to-shore cranes operating at Port of Savannah

Colorado

Colorado Department of Transportation (CDOT) shotcrete project on I-25

This new project is being undertaken for CDOT on Interstate Highway I-25 near Colorado Springs, involves the use of 1000 cubic yards (760 cubic metres) of shotcrete to build a long retaining wall as well being used in the expansion of two bridges including their wing walls, and will require approximately 330 gallons of EdenCrete®.

Importantly, the contractor on this project, Utah based Summit GeoStructures that also operates in Colorado and regularly uses EdenCrete® products, obtained approval from CDOT to use their EdenCrete® enhanced shotcrete.

This approval by CDOT followed successful laboratory trials of the proposed shotcrete mix, supplied by a ready-mix operator with which Eden has not previously worked, but which is a subsidiary of a large global cement and concrete company.

Denver Department of Transportation and Infrastructure (DOTI) Adds EdenCrete® to Concrete Specifications for Some New Roadways and Repairs

Following a detailed, positive review in November 2020 by senior engineers from DDOTI of the performance of two long term trials of EdenCrete® concrete, EdenCrete® has been being included as an additional admixture in the specifications for specific new roadway paving and pavement repairs.

DOTI delivered a very positive evaluation of 3-year long trial of EdenCrete® in concrete road when exposed to heavy vehicle traffic and heavy and often repeated dosages of de-icing salts.

The evaluation was reported to Eden in a letter dated 24 November 2020 from DDOTI that included the following:

“The purpose of this letter is to provide a summary of our experience with EdenCrete. In 2017 several panels of Speer Boulevard were replaced with concrete that had two different doses of EdenCrete. Control panels were also placed on Speer Boulevard. The test section was on the southbound outside lane, south of 6th Avenue. Representatives from EdenCrete were onsite during construction to assist the contractor which ensured a successful project. I would like to thank EdenCrete for the support and help with this project.
During the inspection, I noted that the EdenCrete concrete had performed exceptionally well over the last three years. This was particularly remarkable given the very high volume of vehicle use and associated surface abrasion coupled with the heavy and often repeated magnesium chloride applications. The test sections looked great. I observed no scaling or cracking in the EdenCrete sections, while the reference sections, with no EdenCrete, were exhibiting load and plastic shrinkage cracking and scaling.

OAM1 has included EdenCrete through statement in the specifications that admixtures not listed may be used with approval of the product manager. We will continue to use the product in areas where a high level of reliability is required. We are extremely pleased with the EdenCrete product and look forward to continuing our evaluation of the product.”

1 - Office of Asset Management

This long-term assessment by a government department after a 3-year field trial, conducted under very tough conditions, is of major importance to the future marketing of EdenCrete® across all parts of the US, as well as in any other countries, that are subject to snow and freezing winter conditions and where deicing salts and road chemicals are commonly used.

Projects in the City of Breckinridge and the City of Silverthorne.

During the quarter, EdenCrete® was included in projects in both Breckinridge and Silverthorne, both of which cities are located in the Rocky Mountains.

New Ready-Mix Customers

Two new ready-mix customers added in Colorado during the quarter.

First Volumetric Truck Batching

EdenCrete[®] was used for the first time in a volumetric truck batching and pumping project that commenced in November 2020 with On Demand Concrete, at Loveland, in Colorado (see Figure 3).

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Figure 3. Volumetric truck mixing at the Loveland project site

This first EdenCrete[®] volumetric mixing project involved a two phase, large private residential floor with radiant coil heat tubes and went very well. The total slab thickness is 6” (150mm) however only 2” (50mm) of concrete covered the coils.

Whilst not a large project, it was important because volumetric truck batching has a growing market share in the residential, and small order markets and, importantly for DOT projects across the US.

These projects requiring volumetric truck batching services are often in rural or more remote locations that may not be easily supplied by ready-mix trucks supplied from plant batched concrete production. Truck based, volumetric concrete batching is a growing market sector and its importance is reflected by number of ready-mix suppliers that are also suppliers of volumetric mixed concrete, and it is considered to be a likely growth market for EdenCrete® in many parts of the US.

CDOT - trial of EdenCrete® on I-70 Interstate Highway at Vail Pass

During the quarter, the contract for this trial project (See Eden ASX announcement 15 August 2019) at Vail in the Rocky Mountains that had been scheduled for the third quarter of 2020 was awarded and preliminary testing has commenced.

Kansas

First project - in Wichita

A new and significant construction project that includes EdenCrete® enhanced concrete in a $51 million expansion project that includes a new 505-bay carpark and 10-story tower which changes the skyline of Wichita, Kansas is underway. The two-phase project, RISE: A Beacon of Progress, began with the construction of the new five-story private carpark building (that is now complete), including 17,000 square feet of street-level retail space (see Figure 4-6).

Phase two will be the construction of The Tower, a 10-story building with 135,000 square feet (12,542 square metres) of floor space, including a large rooftop green space featuring grass and trees, on the site of the original parking deck. Upon completion the new carpark will be connected to The Tower by a twostory walkway.