SDI LIMITED — AGM Information 2021

Nov 18, 2021

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FY21 AGM NOVEMBER 19, 2021

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CEO’S ADDRESS SAMANTHA CHEETHAM

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FY21 HIGHLIGHTS

RETURNS TO GROWTH AFTER RECORD YEAR

• Total sales of $81.6 million, up 21.2%, driven by strong sales in key product categories, new product releases and the normalising of most dental markets.

• Total operating expenses increased by 1.2%, compared to the previous corresponding period.

• EBITDA up 71.9% to $16.8m (FY20: $9.8m)

• NPAT up 111.2% to $8.9m (FY20: $4.2m)

• Cashflow remains strong, with no net debt for the Group.

• Final fully franked dividend of 1.65cps up 230% on pcp with full year ordinary dividends of 3.15cps equating to a payout ratio of 41.9%.

• The Brazilian operations review was completed in the year, with the restructure expected to be fully implemented by January 2022.

• Study released showing that SDI’s Riva Star product stops decay, reducing the number of children requiring general anaesthetics for tooth extraction*

EBITDA($m)

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16.8
14.2
12.5 12.1 8.3
7.8 9.8
7.6 8.6
2.7
8.5
7.1
6.4
4.9
3.6
FY17 FY18 FY19 FY20 FY21
H1 ($m) H2 ($m)
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SALES ($m)
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81.6
74.1 74.5 79.6
67.4
42.5 44.8
39.7 40.9 27.4
40.0
37.1 36.8
34.4 33.6
FY17 FY18 FY19 FY20 FY21
H1 ($m) H2 ($m)
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*International Dental Journal – May 2021- Dr Rana Yawary

CATEGORY OVERVIEW

DOUBLE DIGIT CAGR IN KEY FOCUS PRODUCTS

Product Mix %

• Whitening showed the strongest increase, up 55.3% in local currency, due to a return of strong demand, the release of a new Pola Light and Pola Rapid products and the rebranding of the range.

• Aesthetics recovered strongly on the previous year, up 27.2% in local currency, assisted by the easing of restrictions on dentists.

• Equipment up 31.1% in local currency, driven primarily by the success of the Radii LED curing lights.

• Amalgam products stabilised, up 3.8% in local currency with the North American market offsetting declines in other regions.

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Aesthetics Whitening Equipment Amalgam
15.3%
26.1% 23.0% 19.6%
29.9%
7.3%
7.6%
7.6%
8.3%
8.6%
26.9% 32.5%
27.0%
26.7%
26.2%
35.2% 38.9% 42.4% 45.9% 44.9%
FY17 FY18 FY19 FY20 FY21
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FULL PRODUCT PIPELINE PROMISING SIGNS FOR AMALGAM REPLACEMENT

• Amalgam replacement release in 2022/23:

• Tooth coloured filling, showing strength stronger than amalgam

• Stronger than any other tooth coloured filling material

• Will be able to withstand high mastication forces

• New composite products upgrading Luna composite line scheduled for early 2022 release.

• Committed to 1-2 products per year.

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OPERATIONAL UPDATE MANUFACTURING SITE TO DOUBLE

• Additional Warehouse and manufacturing space needed, with the improved workflow efficiencies expected to drive higher margins.

• Currently have 8500sqm with plans to double it for future growth expectations.

• Searching for a greenfield site to develop in the South East of Melbourne.

• Have engaged specialised project managers.

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TRADING UPDATE

AUD SALES JULY TO OCTOBER UP 25% ON PCP

• First 4 months of financial year sales up 27% in Local Currencies:

• UK up 135%, redounding strongly with strong pent-up demand

• Australian Export up 59% following the return of many markets

• Europe (ex-UK) up 34%, continuing momentum see in FY21

• North America up 5% following on from a period of strong sales

• Brazil up 36% with further momentum continuing in FY22

• Australian Domestic down 25%, from record comparable period and impacted by recent lockdowns in NSW and VIC

• Most countries have returned to normal trading conditions

• 1[st] 4 Months AUD gross product margin down 11%, with operational expenses well managed.

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OUTLOOK

o Future years expected to show continued growth in Aesthetics and Whitening products, underpinned by improving market conditions and new product development.

• Logistics continue to be a challenge due to sea and air shipment constraints.

• Good start to the financial year and expect this momentum to continue, leading to another year of growth.

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Thank you

Disclaimer

This Presentation contains summary information about SDI Limited (SDI) and its subsidiaries and their activities. The information in this Presentation does not purport to be complete. It should be read in conjunction with SDI’s other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange, which are available at www.asx.com.au.

The information contained in this Presentation is not investment or financial product advice and has been prepared without taking into account the investment objectives, financial situation or particular needs of any particular person. Before making an investment decision, investors should consider the appropriateness of the information having regard to their own investment objectives, financial situation and needs and seek independent professional advice appropriate to their jurisdiction and circumstances.

To the extent permitted by law, no responsibility for any loss arising in any way from anyone acting or refraining from acting as a result of this information is accepted by SDI, any of its related bodies corporate or its Directors, officers, employees, professional advisors and agents (Related Parties). No representation or warranty, express or implied, is made by any person, including SDI and its Related Parties, as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this Presentation.

An investment in SDI securities is subject to investment and other known and unknown risks, some of which are beyond the control of SDI or its Directors. SDI does not guarantee any particular rate of return or the performance of SDI securities. Past performance information given in this Presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance.

This Presentation contains certain forward‐looking statements with respect to the financial condition, results of operations and business of SDI and associated entities of SDI and certain plans and objectives of the management of SDI. Forward‐looking statements can be identified by the use of forward‐looking terminology, including, without limitation, the terms “believes”, “estimates”, “anticipates”, “expects”, “predicts”, “intends”, “plans”, “goals”, “targets”, “aims”, “outlook”, “guidance”, “forecasts”, “may”, “will”, “would”, “could” or “should” or, in each case, their negative or other variations or comparable terminology. These forward‐looking statements include all matters that are not historical facts. Such forward‐looking statements involve known and unknown risks, uncertainties and other factors which because of their nature may cause the actual results or performance of SDI to be materially different from the results or performance expressed or implied by such forward‐looking statements. Such forward‐looking statements are based on numerous assumptions regarding SDI’s present and future business strategies and the political, regulatory and economic environment in which SDI will operate in the future, which may not be reasonable, and are not guarantees or predictions of future performance. No representation or warranty is made that any of these statements or forecasts (express or implied) will come to pass or that any forecast result will be achieved. Forward‐looking statements speak only as at the date of this Presentation and to the full extent permitted by law, SDI and its Related Parties disclaim any obligation or undertaking to release any updates or revisions to information to reflect any change in any of the information contained in this Presentation (including, but not limited to, any assumptions or expectations set out in this Presentation).

Statutory profit is prepared in accordance with the Corporations Act 2001 and the Australian Accounting Standards, which comply with the International Financial Reporting Standards (IFRS). Underlying profit is categorised as non‐IFRS financial information and therefore has been presented in compliance with Australian Securities and Investments Commission Regulatory Guide 230 – Disclosing non‐IFRS information, issued in December 2011.

All figures in this Presentation are A$ unless stated otherwise and all market shares are estimates only. A number of figures, amounts, percentages, estimates, calculations of value and fractions are subject to the effect of rounding. Accordingly, the actual calculations of these figures may differ from figures set out in this Presentation.