LYCOPODIUM LIMITED — AGM Information 2020

Nov 18, 2020

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Annual General Meeting Financial Year 2020

19 November 2020

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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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2 Annual General Meeting 2020

Corporate Overview

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Michael (Mick) Caratti
Chairman
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Lawrence (Laurie) Marshall
Non-Executive,
Independent Director
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Share Price (as at 16.11.20) Market $4.10 Capitalisation Shares on Issue ~$162.8m 39.7m Peter De Leo Bruno Ruggiero Managing Director Executive Director Earnings Full Year per Share Dividend 29.7 cents 20 cents

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Justine Campbell
Chief Financial Officer
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Steven Chadwick
Non-Executive,
Independent Director
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Shareholder Breakdown Board and Management 41% Institutions 30% Retail 29%

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3 Annual General Meeting 2020

People First – Managing our work safely and in an environmentally friendly way

	FY2020	Current (rolling 12 months)	Target
Hours	2.5 million	2.7 million
LTIFR	0.0*	0.0*	0.0
TRIFR	1.2	1.4	<3.0
EIFR	0.0	0.0	<2.0

• Against Construction Industry frequency rate of 7.5

(Safe Work Australia, Australian Workers’ Compensation Statistics, 2017-18 )

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Annual General Meeting 2020

4

Core Capabilities

Sectors Resources Infrastructure

• Railways

• Gold and Precious Metals

• Roads

• Base Metals

• Ports

• Battery Metals

• Non-Process Resource Infrastructure

• Specialty Metals

  • Asset Management

• Diamonds and Gemstones

• Bulk Minerals

• ₋ Iron Ore

• ₋ Minerals Sands ₋ Bauxite

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Industrial Processes

• Pharmaceuticals

• Biotechnology

• Chemical and Energy

• Food and Beverage

• Manufacturing

• Research and Development

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Services
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• Feasibility Studies

• Process Development and Optimisation

• Engineering and Design

• Project Management and Delivery

• Project Services

• Construction Management

• Commissioning and Operations Support

• Asset Management

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5 Annual General Meeting 2020

FY2020 Financial Highlights

Profit Revenue EBITDA Before Tax $211.1m $27.1m $18.5m Cash at Operating NPAT Bank Cashflow $11.8m $62.2m $102.9m

Operating within our core sectors of Resources, Infrastructure and Industrial Processes, during FY2020 we serviced a cross-section of clients with broad geographical reach across Australia, Africa, Asia, Europe, the Americas and Canada.

COVID-19 impact – we safely managed and progressed the delivery of existing projects, but the award and commencement of new opportunities was curtailed, with projects delayed or suspended.

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Annual General Meeting 2020

6

FY2020 Revenue by Sector

FY2020

	FY2020	FY2019
Sector	A$’000	A$’000
Resources	189.6	134.4
Infrastructure	16.2	13.8
Industrial Processes	5.4	5.8
	211.1	154.0

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2%
8%
90%
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FY2019

4%

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7 Annual General Meeting 2020

FY2020 Revenue by Geography

FY2020

	FY2020	FY2019
Geography*	A$’000	A$’000
Australia	37.8	30.2
Africa	152.3	106.7
Americas	4.6	8.2
Other	16.4	9.0
	211.1	154.0

* By project location

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2%
8%
18%
72%
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FY2019
5%
6%
20%
69%
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8 Annual General Meeting 2020

FY2020 Balance Sheet

	FY2020	FY2019
	A$’000	A$’000
Current Assets	134.3	102.8
Total Assets	155.7	119.8
Total Liabilities	77.8	40.4
Equity	77.8*	79.4

Strong Cash on hand of Balance Sheet provides capacity $102.9m for investment in the business as at 30 June 2020 Operating Net Tangible Assets per Share Cashflow $1.71 $62.2m

• Decline in equity due to exchange differences arising on translation of foreign controlled entities

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9 Annual General Meeting 2020

FY2020 Operational Highlights

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Resources

• Completion of two significant EPCM projects in Burkina Faso – Sanbrado Gold Mine (West African Resources) and Wahgnion Gold Mine (Teranga Gold Corporation), both delivered safely, ahead of schedule and within budget

• Ongoing delivery of Yaouré Gold Mine (Perseus Mining) in Côte d’Ivoire – full-scale construction commenced in September quarter 2019, with COVID-19 manifesting globally only a few months later; construction has remained on time and on budget and the project is on track for ‘stretch target’ of first gold in December 2020 (contracted date January 2021)

• Completion of engineering and procurement services for the expansion of the Mine Services Area for the Fekola Gold Mine (B2Gold) in Mali

• Commencement of Mondium’s EPC delivery of the Western Turner Syncline Phase 2 iron ore project in the Pilbara for Rio Tinto – practical completion of the engineering services achieved within schedule and budget, with delivery ongoing into FY2021

• Delivery of the engineering services scope of Mondium’s EPC contract for Talison Lithium’s Tailings Retreatment Project at Greenbushes, WA

• Completion of numerous studies across a spectrum of commodities, including gold, copper, lead, zinc, silver, lithium, graphite, mineral sands and sulphate of potash

• Successful completion of past studies has led to the award of further scope on a number of projects, supporting the project pipeline moving into FY2021

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10 Annual General Meeting 2020

FY2020 Operational Highlights

Continued to focus on maximising opportunities across core services – rail infrastructure management, non-process infrastructure and infrastructure related asset management:

• Rail infrastructure management – services provided during the year included condition surveys and design services for the Australian Rail Track Corporation (ARTC) and the Country Regional Network (CRN), and rail inspection services for various clients including Pacific National, BHP and Southern Ports Authority

• Non-process infrastructure – providing resources to support delivery of the Armadale Road to North Lake Road Bridge Project in Western Australia

• Infrastructure related asset management – optimisation of maintenance for a number of critical assets for the Cape Preston Port Company’s Pilbara port facilities, which services CITIC Pacific Mining’s magnetite mining operation, the largest magnetite operation in Australia

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Infrastructure

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11 Annual General Meeting 2020

FY2020 Operational Highlights

Continued to leverage our expertise in the provision of projects and engineering services in the areas of specialty chemicals, pharmaceutical and heat/mass transfer:

• Completed scope on the Geo40 Silica Extraction Plant in New Zealand, for the design and commissioning of a new facility for the extraction of silica from geothermal fluids

• Provided services on the Kawasaki Heavy Industries’ Hydrogen Energy Supply Chain (HESC) project, a world-first pilot project to safely and efficiently convert locally-produced, clean hydrogen for international transport

• Ongoing focus on emerging opportunities in renewable energy and sustainability related projects

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Industrial Processes

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12 Annual General Meeting 2020

Business Improvement

Focus during FY2020 was on developing and implementing initiatives to support improved organisational connectedness, to facilitate greater collaboration across the company, globally:

• Development of a Corporate Shared Services model to standardise processes and operating platforms across the business for key functions, including Finance, HR, Travel, IT, Legal, Marketing & Communications, and Corporate Development

• Development and implementation of a People Strategy and People Plan, providing a strategic framework for attracting and retaining talent – focus on leadership and succession planning, upskilling, global mobility and talent management.

• Achieved consistency and alignment in the systems, processes and procedures used across the business to increase efficiency and facilitate work and knowledge sharing between offices across the globe

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13 Annual General Meeting 2020

Innovation

Digital Twin

• Significant initiative being undertaken by ADP Marine & Modular (ADP), our specialist subsidiary in Cape Town

• Applying advanced digital technology and engineering for process simulation and control to support brownfield optimisation work and greenfield plant design

• Complementing the traditional engineering of the plant as a static digital twin (a digital replica of the asset) through progression towards a connected digital twin to facilitate efficient remote operation of the plant.

• This software technology, combined with the specialist inhouse skills developed in its use, will facilitate more extensive and cost-effective options analysis and scenario planning during project study phases

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Orway IQ (OIQ)

• OIQ is a collaboration between Process IQ and Orway Mineral Consultants (a wholly-owned subsidiary of Lycopodium)

• Company formed to provide remote optimisation consulting services to the minerals processing industry

• MillROC (Mill Remote Optimisation and Consulting), developed by OIQ, is an online platform providing customised dashboards, specialist metallurgical consulting and advanced process control consulting, delivered in real-time

• OIQ has been providing services on three foundation projects implementing MillROC, with these initial projects meeting all technical goals

• Perseus’ Yaouré mine nearing completion in Côte d'Ivoire is the first project to be built ‘MillROC ready’

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14 Annual General Meeting 2020

Response to COVID-19

• Despite the growing impact of COVID-19 as events unfolded during the first half of 2020, the progress of our projects in delivery was generally unaffected, as we adjusted our approach to manage the potential implications of the pandemic on our operations

• Supporting and effectively communicating with our geographically dispersed workforce has been critical

• Our response to the crisis has been managed by a dedicated internal taskforce, with actions aligned with the advice provided by the various governments and authorities within the locations in which we operate globally

• Throughout this extremely dynamic period, the health and wellbeing of our people, clients and partners, and the broader communities in which we operate, has remained our priority as we have worked together to maintain business continuity and a pipeline of future work

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15 Annual General Meeting 2020

Our Community

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Joining the Fight Against COVID-19

• We have designed an electrically operated ventilator, known as LycoVent, for use as an emergency backup

• The portable unit, which is independent of piped oxygen supply, was developed locally in Perth

• We are in the process of applying to the Therapeutic Goods Administration (TGA) under the COVID-19 Emergency Exemption for possible use in Australia and also intend to seek the appropriate listing to allow it to be used to support the communities where Lycopodium operates in Africa

• Recognising the impact of the pandemic on the lives of everyday Australians, we also provided financial contributions to the Salvation Army and St Vincent de Paul Society, to support people in need during these difficult times

Providing Grass-Roots Support

• Long-term partnership ongoing with the Clontarf Foundation

• Support provided to the Murlpirrmarra Connection, a not-forprofit organisation that delivers programs for Aboriginal youth in the remote communities of Wiluna and Leonora

• In Africa, continue to support BASICS International, an NGO based in Ghana, which is committed to protecting the basic human rights of children to education, shelter, food and safety

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16 Annual General Meeting 2020

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FY2020 Major Projects
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Wahgnion Gold Project

Sector	Resources
Client	Teranga Gold Corporation
Location	Burkina Faso
Commodity	Gold
Scope	Engineering, Procurement and
	Construction Management (EPCM)
	services
Processing Capacity	2.0 to 2.7 Mtpa

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18 Annual General Meeting 2020

Sanbrado Gold Project

Sector	Resources
Client	West African Resources
Location	Burkina Faso
Commodity	Gold
Scope	Engineering, Procurement and
	Construction Management (EPCM)
	services
Processing Capacity	2.0 to 2.7 Mtpa

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19 Annual General Meeting 2020

Yaouré Gold Project

Sector	Resources
Client	Perseus Mining Limited
Location	Côte d'Ivoire
Commodity	Gold
Scope	Engineering, procurement and
	construction EP(C) services
Processing Capacity	3.0 Mtpa

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20 Annual General Meeting 2020

Western Turner Syncline Phase 2

Sector	Resources
Client	Rio Tinto
Location	Pilbara, Western Australia
Commodity	Iron Ore
Scope	Engineering, design, procurement and
	construction of the mineral processing
	facilities and associated non-process
	infrastructure
	Awarded and delivered via Mondium
Processing Capacity	36 Mtpa

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21 Annual General Meeting 2020

Tailings Retreatment Project

Sector	Resources
Client	Talison Lithium
Location	Greenbushes, Western Australia
Commodity	Lithium
Scope	Engineering, procurement and
	construction (EPC) services
	Awarded and delivered via Mondium
Processing Capacity	2 Mtpa

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22 Annual General Meeting 2020

Boto Gold Project

Sector	Resources
Client	IAMGOLD Corporation
Location	Senegal
Commodity	Gold
Scope	Engineering and Procurement (EP)
	services
Processing Capacity	2.7 Mtpa

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23 Annual General Meeting 2020

Fekola Mine Expansion

Sector	Resources
Client	Fekola SA (B2Gold)
Location	Mali
Commodity	Gold
Scope	Engineering and Procurement (EP)
	services for expansion of the Mine
	Services Area
Processing Capacity	7.5 Mtpa

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24 Annual General Meeting 2020

Ahafo North Stage 3 Study

Sector	Resources
Client	Newmont Ghana Gold Limited
Location	Ghana
Commodity	Gold
Scope	Advancement of engineering design to
	prepare for the procurement of long lead
	items and to enable the award of early
	contracts to support Stage 4 (execution)
Processing Capacity	3.4 to 3.7 Mtpa

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25 Annual General Meeting 2020

Motheo Copper Project Processing Plant

Sector	Resources
Client	Sandfire Resources Ltd
Location	Botswana
Commodity	Copper
Scope	Optimised Feasibility Study (OFS) and
	Front End Engineering and Design (FEED)
	to support long lead procurement and
	early works site packages
Processing Capacity	3.2 Mtpa

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26 Annual General Meeting 2020

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Recently Awarded New Work
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Recent Awards

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Resources

Project	Client	Location	Commodity	Scope
Winu	Rio Tinto (via Mondium JV)	Western Australia	Copper	Front End Engineering Design (FEED)
Ahafo South Mine Water	Newmont Ghana Gold	Ghana	Gold	Engineering, Design and Procurement
Treatment Plant Expansion				Services
Motheo	Sandfire Resources	Botswana	Copper	Engineering, Design and Procurement
				Services
Gruyere Pebble Circuit	Gruyere Management Pty Ltd	Western Australia	Gold	Engineering and Procurement Services
Upgrade Project
Gramalote	B2Gold	Colombia	Gold	Feasibility Study
Venetia Greasebelt	De Beers	South Africa	Diamond	EPC delivery of project scope
Chitotolo Flowsort	Sociedade Mineira Do Chitotolo	Angola	Diamond	Design and supply of a new flowsort
Séguéla	Roxgold	Côte d’Ivoire	Gold	Front End Engineering Design (FEED)
				and Feasibility Study Optimisation

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28 Annual General Meeting 2020

Recent Awards

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Infrastructure

Project	Client	Location	Scope
Inland Rail T2A	ARTC	Victoria/New South Wales	Detailed design of track slews at various locations
North Dynon	Qube	Victoria	Detailed design of terminal reconfiguration
Inland Rail PPP, Operations	Acciona / Cintra	Queensland	Technical advisor for the Inland Rail PPP, providing
and Maintenance Technical			operations and maintenance support – scope includes
Advisor			the development of a costed maintenance plan and
			maintenance implementation plan for the 25 year
			operational phase
Riverina Intermodal Freight	Huon Contractors	New South Wales	Track and civil detailed design of the rail terminal
and Logistics Hub

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29 Annual General Meeting 2020

Recent Awards

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Industrial Processes

Project	Client	Location	Scope
LNG for Diesel	Mitsui E&P Australia	WA mining sector	Options Study to replace diesel with LNG in the Western
			Australian mining sector
Chlor Alkali FEED	Coogee Chemicals	Western Australia	FEED study for new Chlor Alkali Facility
Synchrotron Bright Beamline	Innospec GmbH	Victoria	Supply and install hutches for Bright Beamline
Aqueous Ammonia	Energy Australia	New South Wales	Replace Gas Ammonia system with Aqueous Ammonia
			Plant – Design and Construct
Silt Separator	Lamb Weston	Victoria	Design and Construct Silt Separator

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30 Annual General Meeting 2020

Outlook and Strategy

The measures implemented to contain the coronavirus pandemic are likely to continue to constrain global economic activity for an extended period – with this uncertainty, our forward strategy is to stay focused on our established relationships to secure ongoing works with key clients

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Infrastructure

Industrial Processes

Resources

OUTLOOK

OUTLOOK

OUTLOOK

• Pipeline of identified opportunities across core service offering of rail infrastructure management, nonprocess infrastructure and infrastructure related asset management

• Current global economic outlook is driving up the price of gold – works to our experience and strengths

• Emerging markets, such as cannabinoids, light metals and water purification

• Focus on energy efficiency and clean energy generation

• Opportunity for sustaining capital works projects in domestic Australian market, due to new developments potentially being delayed

STRATEGY

STRATEGY

• Continue to leverage established long-term partnerships with core client base to secure new opportunities

• Leverage specialist expertise to support emerging markets

STRATEGY

• Experience and multidisciplinary capability across a range of commodities and geographies is advantageous – capitalise on opportunities across a broad cross-section of the market

• Opportunity to support renewable energy and sustainability related projects as businesses seek to operate smarter and leaner in response to current economic pressures

• As clients focus on streamlining their operations to curtail costs, leverage asset management capability to establish recurring revenue streams

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Annual General Meeting 2020

31

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Thank You
32 Annual General Meeting 2020
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