LYCOPODIUM LIMITED — AGM Information 2019

Nov 20, 2019

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Meeting 2019

Delivering engineering excellence, value and innovation Annual General Meeting 2019

About Lycopodium

Lycopodium is an innovative and value driven process, engineering and project delivery group.

The Company is headquartered in Perth, Western Australia and is listed on the Australian Stock Exchange ( ASX: LYL ).

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Annual General Meeting 2019

Corporate Overview

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Share Price
(as at 15.11.19)
$5.30 CapitalisationMarket
~$217.7m
Shares on Issue
Michael (Mick) Caratti 39.7m Peter De Leo Bruno Ruggiero Peter Dawson
Chairman Managing Director Executive Director Executive Director
Cash at Bank
(as at 30.6.19)
$60.5m
Justine Campbell Lawrence (Laurie) Marshall Robert (Bob) Osmetti Steven Chadwick Rodney (Rod) Leonard
Chief Financial Officer Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director
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People First

HSE year-to-date as at end of October 2019:

• 2.4 million manhours controlled

• Zero LTI, MTI or debilitating injury of any kind

• LTIFR – 0

• TRIFR – 1.81[1]

• 1 Against Construction Industry frequency rate of 8.1 (Safe Work Australia, Australian Workers’ Compensation Statistics, 2016-17)

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Core Capabilities

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Resources
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• Gold and Precious Metals

• Base Metals

• Battery Metals

• Specialty Metals

• Diamonds and Gemstones

• Bulk Minerals

• Iron Ore

• Minerals Sands

• Sectors Services

• Infrastructure Industrial Processes

• • Railways • Pharmaceuticals • Feasibility Studies

• Process Development and Optimisation

• Roads

• Biotechnology

• Chemical and Energy

• Ports

• Engineering and Design

• Non-process Resource Infrastructure

• Food and Beverage

• Project Management and Delivery

• Manufacturing

• Project Services

• Asset Management

• Construction Management

• Research and Development

• Commissioning and Operations Support

• Asset Management

• Bauxite

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Locations

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Toronto
CA
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During FY2019:

• Established additional offices in South Africa to support African operations.

• Relocation of Manila office within the Bonfacio Global City (BGC).

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Manila
PH
Johannesburg
Brisbane
SA
AUS
Cape Town
SA
Perth
AUS
Newcastle
AUS
Melbourne
AUS
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Annual General Meeting 2019

FY2019 Group Highlights

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Revenue NPAT Fully Franked Dividend $154.0m $16.4m 30 cents

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Operational

• Continued to expand geographical reach within Resources sector.

• Delivered projects via a range of contracting models and further developed capability to deliver EPC projects.

• Established Orway IQ joint venture.

• Improved organisational connectedness to support greater collaboration.

Net Tangible EPS EBITDA Assets per Share 41.5 cents $25.1m 182.9 cents

• Delivered on succession planning strategy, with successful transition of new management into critical roles – thank you to retiring founding directors, Rod Leonard and Bob Osmetti, who have been instrumental in establishing our culture and realising success.

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FY2019 Revenue by Sector

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FYE Jun-19
Sector A$’000
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Resources 136.8
Infrastructure 11.6
Industrial Processes 5.7
154.1
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4%
7%
89%
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FY2019 Revenue by Geography

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FYE Jun-19
Sector A$’000
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Australia 29.6
Africa 100.8
Americas 9.7
Other 14.0
154.1
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9%
19%
6%
66%
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FY2019 Balance Sheet

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June 19 June 18
A$m A$m
Current Assets 102.8 118.5
Total Assets 119.8 114.4
Total Liabilities 40.4 62.0
Equity 79.4 79.3
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Strong Balance $60.5m Sheet as at 30 June 2019 Minimal Net Tangible Assets per Share 182.9 cents Debt

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Reward and Retention Policy

• The Remuneration Committee has developed an Executive and Key Staff Reward and Retention Policy.

• These key personnel are critical to the current and future success of the Company and the scheme is designed to reward aboveaverage performance for both existing and future senior managers, enabling future managers to build a shareholding in the Company.

• The scheme adopts a combination of a short-term incentive (STI) to reward the select individuals for their annual performance, and a long-term incentive (LTI), which serves to reward and retain participants for achieving agreed KPIs on the basis of the Company achieving a minimum level of profitability.

• The STI award will be at the discretion of the Board and subject to achieving a minimum hurdle audited NPBT (as measured against group revenue).

• The LTI award will be subject to achieving the minimum NPAT, in addition to a set of individual personal objectives (PO) and Company objectives (CO).

• The total LTI dollar amount will be set and converted to equivalent performance rights at the prevailing Company share price as per the detailed rules of the scheme and there will be a three-year vesting period.

• The total pool available for the reward and retention initiative described under this policy is limited to 10% of annual audited NPAT and all entitlements will be scaled back accordingly due to the effect of the cap on the bonus pool.

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Major Projects
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Cobré Panama

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SECTOR Resources
CLIENT First Quantum Minerals
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LOCATION Panama COMMODITY Copper, gold, molybdenum • Process plant design

• Services to non-process

• SCOPE infrastructure buildings • Field engineering

• Plant commissioning support

PROCESSING 85 Mtpa CAPACITY

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“Cobre Panama goes commercial – one of the smoothest ramp-ups we have seen.”

Summary: FM declared commercial production at Cobre Panama as at September 1, a month ahead of guidance and two weeks ahead of our expectation. Total copper production through the end of September is 87kt, in line with our forecast of 88kt. Full year production guidance of 140-175kt is unchanged, as is the timing on the ramp-up to 100mtpa.

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Ity

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SECTOR Resources
CLIENT Endeavour Mining Corporation
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LOCATION COMMODITY Gold

Côte d’Ivoire

• EPCM services for the gold CIL plant

SCOPE • EPCM services to increase capacity to 5 Mtpa PROCESSING 5 Mtpa CAPACITY

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Endeavour Declares Commercial Production of Its Ity CIL Project at Full Nameplate Capacity

April 8, 2019 – Endeavour Mining Corporation is pleased to announce commercial production of its Ity CIL project, in Côte d'Ivoire, at its full nameplate capacity following a quick ramp up phase.

Sébastien de Montessus, President & CEO, stated: "I would like to congratulate the entire team for their hard work in helping us achieve this major accomplishment for Endeavour.

Achieving commercial production at the Ity CIL project marks a transformational moment in our history and an inflection point as we significantly increase our free cash flow capabilities."

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Toka Tindung

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SECTOR Resources
CLIENT PT Archi Indonesia
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LOCATION Indonesia

COMMODITY Gold

• EPCM services for throughput upgrade of the process plant facilities

SCOPE

• Capacity increase from 2.4 Mtpa to 3 Mtpa

PROCESSING CAPACITY

3 Mtpa

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Wahgnion

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SECTOR Resources
CLIENT Teranga Gold Corporation
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LOCATION Burkina Faso

COMMODITY

Gold

• Full EPCM services for the design and construction of the process plant

• SCOPE • Engineering design for support infrastructure, including accommodation village

• PROCESSING 2.7 Mtpa

• CAPACITY

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Bonasika

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SECTOR Resources
CLIENT Guyana Industrial Minerals
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LOCATION Guyana

COMMODITY Bauxite

• Detailed engineering

• • Technical procurement support

SCOPE

PROCESSING CAPACITY

• 350 Ktpa

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Montepuez Ruby Mines

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SECTOR Resources
CLIENT Gemfields
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LOCATION Mozambique

COMMODITY Gemstones

• Installation and commissioning of the Recovery Plant

SCOPE

• Designed to incorporate UVsorting technology

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Sanbrado

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SECTOR Resources
CLIENT West African Resources
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LOCATION Burkina Faso COMMODITY Gold • Full Engineering, Procurement SCOPE and Construction Management (EPCM) services PROCESSING 2 to 2.7 Mtpa CAPACITY

Works currently on schedule and budget

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Mt Cattlin

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SECTOR Resources
CLIENT Galaxy Lithium Australia
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LOCATION

Ravensthorpe, WA

COMMODITY

Lithium

• Design and construction of four new process modules to increase yield optimisation of the existing lithium processing facility

SCOPE

• Awarded and delivered via Mondium

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Feasibility Studies

	SECTOR	Resources
	PROJECT	CLIENT	LOCATION	COMMODITY	COMMENTS
	Boto	IAMGOLD	Senegal	Gold	Preferred EPCM
		Corporation			partner
	Toliara	Base Resources	Madagascar	Mineral sands	In conjunction
					with Mineral
					Technologies
	Yanqul	Mazoon Mining	Oman	Copper, gold
		Company
	Bomboré	Orezone Gold	Burkina Faso	Gold	Commenced
		Corporation			FEED for oxide
					phase

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Infrastructure Projects

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SECTOR Infrastructure
PROJECT CLIENT LOCATION SCOPE
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Newcastle	Downer EDI	New South	Engaged to support the
Light Rail	Limited	Wales	development of the
			operating and maintenance
			manuals of the project’s
			infrastructure
Pacific	Pacific	Across	Provision of Rail
National	National	Australia	Infrastructure Management
RIM Services			(RIM) services (3 plus 1
			year agreement) to inspect,
			certify and manage defects
			at 62 sites across Australia

Annual General Meeting 2019

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Industrial Processes Projects

	SECTOR	Industrial	Processes
	PROJECT	CLIENT	LOCATION	SCOPE
	Geo40	Geo40	New	Design and commissioning of a
	Silica		Zealand	new facility for the extraction of
	Extraction			silica from geothermal fluids
	Plant
	Karratha	EcoMag	Western	Further develop the overall plant
	Magnesium		Australia	design process through a
	Recovery			Feasibility Study Report
	Plant
	CSL	CSL	Victoria	Detailed design of centrifuge
	Centrifuge	Behring		cooling skids as part of a new
	Cooling			CSL facility to process human
	Skids			plasma into protein-based
				therapies

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Process Optimisation: Orway IQ

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• Orway IQ is a joint venture between Lycopodium subsidiary company Orway Mineral Consultants (OMC) and Process IQ Pty Ltd.

• Orway IQ was formed to deliver a remote optimisation consulting service – MillROC (Milling Remote Optimisation Consulting) – to the minerals processing industry.

• The JV draws on OMC’s expertise in comminution design, modelling and optimisation and Process IQ’s expertise in the IIoT (Industrial Internet of Things) cloud-based computing, process control, automation and instrumentation.

• Orway IQ is at the forefront of minerals process optimisation globally, with experts providing remote optimisation consulting services on live data to support mines to increase throughput, recovery, power efficiency and reduced liner wear.

• MillROC applies process models and analysis to real-time plant data which enables expert consultants to provide frequent and high-level advice, including guidance on operating approaches and setpoints.

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Strategy and Outlook: Overarching

• Strong pipeline of projects and key identified prospects.

• Continue to secure EPC projects and further establish Mondium as a leading EPC contractor.

• Further geographical expansion – pursue opportunities in large markets where we are under-represented.

• Pursue annuity type revenue to reduce earnings volatility.

• Leverage expertise and experience for greater return – reward for the risk we manage.

• Create an exciting people experience to attract, engage, inspire and retain a high performing, global, professional workforce.

• Capture, retain and transfer knowledge and drive innovation – strategically leverage knowledge base for the development of our people and to drive continuous improvement.

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Strategy and Outlook: Sectors

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Resources
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• Diversified offering – broad range of commodities and geographies.

• Gold price remains strong.

• Establishment of Orway IQ, providing remote optimisation consulting service to the minerals processing industry.

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Infrastructure
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• Market rationalisation to fit with core services we provide.

• Focus on rail infrastructure management, non-process infrastructure and infrastructure related asset management.

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Industrial Processes
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• Continue to leverage expertise – complex chemistry, heat and mass transfer and solid/liquid separation.

• Emerging opportunities – renewable energy, sustainability related projects, cannabinoids, light metals and water purification.

• Market is broad and remains very competitive.

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Thank You

The commitment and talent of our people is fundamental to achieving our success

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Annual General Meeting 2019

Thank you for your attendance today, we are happy to answer your questions

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