VYSARN LIMITED — AGM Information 2021

Nov 24, 2021

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AGM PRESENTATION AGM Presentation NOVEMBER 2020 November 2021

Disclaimer

This presentation has been prepared by Vysarn Limited ("Vysarn" or the "Company") ("Presentation") and contains general and background information about Vysarn activities current as at the date of the Presentation. The Presentation should not be considered to be comprehensive or to comprise all the information that an investor should consider when making an investment decision. The information in the Presentation should be read in conjunction with Vysarn's other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange, available at www.asx.com.au.

The Presentation contains statements, opinions, projections, forecasts and other material ("forward-looking statements") with respect to the financial condition, business operations and competitive landscape of the Company and certain plans for its future management. The words anticipate, believe, expect, project, forecast, estimate, likely, should, could, may, target, plan and other similar expressions are intended to identify forward-looking statements. Such forwardlooking statements are not guarantees of future performance and include known and unknown risks, uncertainties, assumptions and other important factors which are beyond the Company's control and may cause actual results to differ from those expressed or implied in such statements. There can be no assurance that actual outcomes will not differ materially from these statements. Any forwardlooking statements contained in this document are qualified by this cautionary statement. The past performance of the Company is not a guarantee of future performance. None of the Company, or its officers, employees, agents or any other person named in the Presentation makes any representation, assurance or guarantee as to the accuracy or likelihood of fulfilment of any forward-looking statements or any of the outcomes upon which they are based.

The Presentation is not financial product, investment advice or a recommendation to acquire Vysarn securities and has been prepared without taking into account the objectives, financial situation or needs of individuals. Each

recipient of the Presentation should make their own enquiries and investigations regarding all information in the Presentation including, but not limited to, the assumption, uncertainty and contingencies which may affect future operations of Vysarn and the impact that different future outcomes may have on Vysarn. Before making an investment decision prospective investors should consider the appropriateness of the information having regard to their own objectives, financial situation and needs, and seek legal, taxation and financial advice appropriate to their jurisdiction and circumstances. Vysarn is not licensed to provide financial product advice in respect of its securities or any other financial products. Cooling off rights do not apply to the acquisition of Vysarn securities. Each investor must make its own independent assessment of Vysarn before acquiring any securities in Vysarn.

Vysarn Limited results are reported under International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. The Company discloses certain non IFRS measures that are not prepared in accordance with IFRS and therefore are considered non-IFRS financial measures. The non-IFRS measures should only be considered in addition to and not as a substitute for, other measures of financial performance prepared in accordance with IFRS.

To the maximum extent permitted by law, the Company and its directors and advisers give no warranty, representation or guarantee as to the accuracy, completeness or reliability of the information contained in the Presentation. Further, none of the Company, or its officers, employees or agents accepts, to the extent permitted by law, any liability for any loss, claim, damages, costs or expenses arising from the use of the Presentation or its contents or otherwise arising out of, or in connection with it. Any recipient of the Presentation should independently satisfy themselves as to the accuracy of all information contained herein.

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VYSARN LIMITED ASX:VYS

Cor orate Sna shot p p

About Vysarn Limited (ASX:VYS)

Vysarn Limited (‘Vysarn’ or ‘the Company’) via its two wholly owned subsidiaries, Pentium Hydro Pty Ltd (‘Pentium’) and Australian Groundwater Solutions Pty Ltd (‘Yield’) is a leading provider of production critical, hydrogeological drilling, dewatering and test pumping services.

The Company has experienced significant growth since inception (September 2019), primarily driven by Tier-1 iron ore mining companies that are facing mounting dewatering issues as a growing proportion of their resources lie below the water table.

Vysarn is building upon its robust foundation via the execution of a vertical integration growth strategy to transform the Company into a specialised ‘end-toend’ water service provider.

Corporate Snapshot*

Share Price	$0.083
Shares on Issue	~391.9m
Market Capitalisation	~$32.5m
Net Debt	~$6.5m
Enterprise Value	~$39.0m
Top 20	52.7%
Board and Management	20.2%

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Share Price Performance
7 $0.14
6 $0.12
5 $0.10
4 $0.08
3 $0.06
2 $0.04
1 $0.02
0 $0.00
Volume Share Price
Volume (M) Share Price
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*Share price, market capitalisation, share holdings as at 23 November 2021. Net debt as in Appendix 4E and Financial Report released 27 August 2021

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VYSARN LIMITED ASX:VYS

Investment Hi hli hts g g

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Production Critical Services

Tier-1 mining clients rely on Pentium and Yield’s services to maintain production. A focus on production critical services rather than mineral exploration and resource definition mitigates resource sector cyclical risk.

Strong Growth Thematic

Water is one of the biggest impediments to ongoing production in the Pilbara. Production related water issues are going to be exacerbated as production increases from below the water table.

Vysarn Limited Vysarn Limited A robust, production focused, end-to-end water A robust, production service provider capable of focus d, end-to-end water service provider apable of withstanding economic withstanding economic cycles cycles

Strong Growth Profile

Vysarn is delivering strong year-on-year growth, with EBITDA anticipated to grow from $5.0m (FY21) to $10 - $11m (FY22)*.

Servicing Tier-1 Clients

Pentium and Yield have executed multi-year Master Service Agreements with major clients, Fortescue Metals Group and Roy Hill Iron Ore. Management anticipates entering into a scope of work contract with a new Tier-1 iron ore producer in 2H22.

Executing Vertical Integration Strategy

Vysarn has initiated its vertical integration strategy to transform the Company into an end-to-end water service provider.

Highly Experienced Board & Management

Experienced Board with a history of delivering significant shareholder returns and have a material investment in the company.

• ASX announcement Vysarn Financial Results for FY2021 (27 August 2021) Based on full rig utilisation with no significant rig downtime events such as prolonged wet weather, major mechanical breakdowns and COVID lockdowns

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VYSARN LIMITED ASX:VYS

FY21 O erational Overview p

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FY21 was a pivotal year, whereby Vysarn successfully positioned the Company to achieve full asset utilisation and steady state earnings as it entered FY22. Management remained focused on continuing to optimise operations while actively looking to execute on the Company’s vertical integration growth strategy.

• Master Service Agreements (MSAs) extensions signed with Fortescue Metals Group (3 years + 2) & Roy Hill Iron Ore (3.5 years + 1). Contracts underpin 75% utilisation going forward.

• ▪ Scope of work contracts executed with Australian Potash Ltd and Iluka Resources

Significant contracts executed

• Dry hire agreement extension with Easternwell Minerals.

• Current contracts and tender pipeline positioned to exceed 100% rig utilisation (12 company owned rigs) moving into FY22.

• Pentium put in place access to dry-hire arrangements for 2 additional conventional rigs to satisfy additional demand up to 14 rigs.

Contracts exceed Pentium fleet capacity

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• Successfully navigated a challenging labour market, growing employee headcount from 55 to 100+.

• The Company vision, culture and standard of equipment has helped facilitate this growth.

Doubled headcount

• Completed the rebuild of two Foremost Dual Rotary (DR) rigs and upgraded a Schramm T130XD from a conventional drill rig to Dual Tube Flooded Reverse (DTFR) capability.

• ▪ Scope for additional T130XD rigs to be upgraded to DTFR to capture wider market.

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Rig rebuilds & upgrades complete

• Pentium is now one of the largest pure hydrogeological drilling companies in Australia and the only company to provide three rig types (DR, DTFR and Conventional drilling).

• OH&S Management systems (ISO 45001:2018), quality management systems (ISO 9001:2015) and environmental management systems (ISO 14001:2015)

• Accreditation is essential to attain preferred contractor status with Tier-1 clients

ISO accreditations

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VYSARN LIMITED ASX:VYS

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Stron Financial Performance g

FY22 – Outlook

Pentium Hydro Rig Deployment

• Pentium Hydro averaged 7 rigs deployed (of 12 total) throughout FY21 o Rig deployment peaked at 10 rigs in Q4FY2021

• Pentium Hydro contracts provide visibility to maintain full utilisation of the Company’s owned rig fleet throughout the remainder FY2022.

• Strong top-line revenue anticipated – Targeting ~$50m revenue from operations in FY22

• Contracts were executed in Q4FY21 to deliver 100% rig deployment (12 rigs) o Third party critical services and supply chain constraints resulted in rig readiness and mobilisation delays in FY21

• Material EBITDA growth – The Company is budgeting FY22 EBITDA to be $10.0m – $11.0m*.

• Budgeting ~$10.0m EBITDA from the full utilisation of 12 rigs (Pentium).

FY21 – Profit & Loss

• Additional contributions from dry-hired hydro rigs and the acquisition of Yield Test Pumping is anticipated to underpin budgeted EBITDA in FY22.

• Significant Revenue growth - FY21 revenue from operations of $25.8m (up 117% from $11.91m in FY20).

• Strong EBITDA performance - Delivered FY21 EBITDA of $5.0m (up $6.2m from -$1.2m in FY20).

• Rig readiness delays and additional labour costs associated to rigs negatively impacted EBITDA by ~$1.0m.

• Maintained lean corporate overheads – Monthly corporate overheads averaged $0.37m over FY21 (will expand in FY22 to support and execute growth initiatives).

FY21 – Balance Sheet

• Net Tangible Assets of $24.8m (up 1.8% from $24.4m at June 30 FY20).

• Plant & Equipment of $29.6m (up 19.6% from $24.7m at June 30 FY20).

Normalised EBITDA

Operational Revenue

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60 12
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FY20 (A) FY21 (A) FY22 (F) FY20 (A) FY21 (A) FY22 (F)
Revenue ($M) EBITDA ($M)
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• ASX announcement Vysarn Financial Results for FY2021 (27 August 2021) Based on full rig utilisation with no significant rig downtime events such as prolonged wet weather, major mechanical breakdowns and COVID lockdowns

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VYSARN LIMITED ASX:VYS

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GROWTH STRATEGY

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The Path to Vertical Inte ration g

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Established Operations FY2020

Expanded Operations FY2021

• Vysarn acquired hydrogeological drilling assets from Ausdrill Limited (now Perenti Ltd) via its wholly owned subsidiary Pentium Hydro. Asset acquisition only (no contracts or personnel).

• Enhanced and expanded operations, delivering sustainable profitability.

• Attracted additional highly experienced management and operational personnel.

• Increased rig fleet to 12.

• Executed multi-year Master Service Agreements (MSA) with Fortescue Metals Group Limited and Roy Hill Iron Ore.

• Relisted on ASX September 2019.

• Established experienced executive and operational team.

• Defined a clear growth strategy and positioned the Company to become a vertically integrated water service provider.

• Initiated operations and executed contracts servicing Tier-1 miners.

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Enhanced & Vertically Integrated FY2022

• Delivering operational excellence.

• Realised opportunities to achieve full utilisation of rig fleet.

• Achieved EBITDA of $3.5m for the months of July to October in FY22 (unaudited management accounts).

Transitioning to a vertically integrated water service provider

• Acquisition of Yield.

• Active assessment of additional acquisition opportunities ongoing.

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VYSARN LIMITED ASX:VYS

Ac uisition of Yield Test Pum in q p g

About Yield Test Pumping

Acquisition Summary

Yield is a leading provider of tailor-made testpumping solutions to Tier-1 clients.

Deal Value Cash VYS Shares $2.875m $2.50m 5.0m

Yield’s technology delivers market leading performance and safety:

Vysarn has acquired 100% of the issued shares in Yield via a Share Sale Agreement

• Fully automated purpose-built, all terrain truck mounted, reel test pumping unit

• Includes the business operations, contracts, assets, IP, employees, goodwill and inventory

• Remote access technologies allow clients to view and adjust test pumping parameters in real-time

Effective transaction date of 30 September 2021

– Importance of test pumping Yield undertakes five critical tests to determine:

• Revenue recognition from 1 October

• Subsequent pleasing performance

• Well, bore-field and aquifer performance

Managing Director and majority shareholder of Yield, Mr Dwayne Moppett, agreed to:

• Capital infrastructure requirements

• 3 year contract to lead and grow the business

MSA with Fortescue Metals Key Client (2+1 years) Previous Clients

• 12 month voluntarily escrow

Targeted Annualised Transaction EBITDA EV/EBITDA $700K – $800K* ~4X

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Acquisition Rationale

The next service in the vertical

• Test pumping occurs immediately after Pentium drills and cases a well

Requested by clients

• Integration of these services has been requested by Vysarn’s major clients

Shared key client

• Both companies have MSAs with FMG

Strong track-record

• Yield is a certified contractor to Tier-1 clients

Strong foundation to execute clear growth strategy

• Access to capital will facilitate a staged expansion of Yield to meet increasing demand

Optimal scale for entry

• Acquisition provides a fast, low risk and cost effective entry into the sector

• Highly experienced with an aligned vision & culture ▪ Yield management are excited to leverage their significant experience to help transform Vysarn

*Annualised budgeted EBITDA for Yield (for the first 12 months of operations) under Vysarn ownership pre performance incentives for Yield management.

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VYSARN LIMITED ASX:VYS

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Pentium & Yield Growth Strate gy

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Client Pentium Hydro Yield
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Aggressive business development

• Focus on executing/expanding contracts with Focus on cross selling to Pentium clients: new and existing Tier-1 clients: ▪ inbound interest from

• Strong inbound interest from existing and

• ▪ Anticipate scope of work contract with new prospective clients for integrated services. Tier-1 iron ore producer. ▪ test of

• Satisfying test pumping requirements of

• ▪ Yield’s relationship with other iron ore Pentium contracts to deliver significant miners enhances prospects of further work. growth.

Fleet expansion

• Recently expanded fleet (2 rigs) via capital ▪ Potential to commission the build of light, dry-hire agreement. multiple purpose-built test pumping units

• ▪ May upgrade 2 more conventional rig(s) to over the next 12-24 months (subject to demand).

• May upgrade 2 more conventional rig(s) to DTFR if requested by clients.

• Searching for quality second hand rig(s) to fulfil excess demand.

Operational excellence to deliver optimised returns

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Previous
Clients
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Apply a top-down management approach to deliver operational excellence and optimised returns across all business divisions:

• Standardised and predictable structured contracts to achieve earnings from all operations.

• Maintain full asset utilisation and implement double-shifting where available.

• Maximise return on net operating assets.

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VYSARN LIMITED ASX:VYS

Growth via Vertical Inte ration g

Vysarn is focused on continuing to build value, scale and diversity through organic Vysarn is focused on continuing to build value, scale and diversity through organic growth and strategic acquisitions growth and strategic acquisitions

With the acquisition of Yield Test Pumping, Vysarn has created a unique and integrated service offering in Stage 2 of the water vertical. The acquisition of Yield and its aggressive growth strategy is to be funded from Vysarn’s balance sheet, providing shareholders enhanced upside potential.

What’s next?

Vysarn is actively assessingTweak to remove IPadditional upstream and downstream opportunities within the ‘four stages’ of water management. These opportunities range from organic developments, modest acquisitions to company transformational acquisitions. Any undertaking must satisfy management’s primary focus of delivering shareholder returns.

Benefits of Vertical Integration

Acquisition Criteria

• Asking price is realistic relative to earnings.

• Reduced economic & concentration risk.

• Diversified revenue streams with a balanced mix of capital light and capital-intensive businesses.

• Have clear group strategic rationale.

• Acquisition comes with quality management and industry expertise.

• Scale and sustainable shareholder returns.

• Earnings are first and foremost sustainable, with realistic growth prospects.

• Provide market leading service to customer.

• Market positioning as a leader and ‘go-to’ provider of end-to-end water services.

• Targets have the potential to be immediately earnings accretive.

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• Design

• Stage ▪▪ Hydrogeological ConsultingBorefield Design 1 ▪ Infrastructure Design

• Engineering

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• Extract

• Stage ✓ Drilling ▪ Borefield Construction

• 2 ✓ Test Pumping ▪ Headworks

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Transfer

• Stage ▪▪ Pump InstallationBore Pump Stations 3 ▪ Pipeline Construction

• Transfer Pump Stations

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Store

• Stage ▪▪ Aquifer RechargeMine use ▪ Water Treatment

• 4 ▪ Water Control

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VYSARN LIMITED ASX:VYS

V sarn’s Tan ible Milestones y g

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To date we have met tangible milestones to transform Vysarn into a pre-eminent whole of life, end-to-end water service provider

FY2022

Vertically Integrated Water Services Provider

FY2023+

Large Diversified Water Services Provider

• ❑ Deliver budgeted EBITDA of $10m+*.

• ❑✓ Execute/expand MSAs with Tier-1 client(s).

• ❑✓ Position the Company to achieve full asset utilisation and steady state earnings of $1m EBITDA per month

• ❑ Operational excellence - Maintain full asset utilisation across Pentium and Yield.

• ❑✓ Complete acquisition of Yield and integrate operations.

• ❑ Expand Yield fleet of market leading test pumping units to meet client demand.

• ❑ Execute additional organic entry or acquisition/s.

• ❑ Target company transformational acquisition in water services across Australia.

• ❑ EBITDA – Targeting sustained YoY growth.

• ❑ Continue staged expansion of test pumping offering (and other entries into the vertical).

• ❑ Automation of current drill rig fleet.

• ❑ Drill rig fleet expansion if underpinned by long term contract.

• ❑ Aspirational large scale horizontal or vertical acquisition.

• ❑ Position as preeminent player in hydrogeological drilling space.

• ❑ Establish position as a major contractor in the whole of life end to end water service vertical.

• ASX announcement Vysarn Financial Results for FY2021 (27 August 2021) Based on full rig utilisation with no significant rig downtime events such as prolonged wet weather, major mechanical breakdowns and COVID lockdowns

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VYSARN LIMITED ASX:VYS

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Key Contacts

Vysarn Limited

Registered Office

Investor Relations

James Clement

Managing Director

108 Outram Street, West Perth WA 6005 Telephone: +61 8 6144 9777 ASX Code: VYS Website: www.vysarn.com.au

Alastair Murray

Candour Advisory M: +614 15 629 977 E: alastair@candouradvisory.com.au

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VYSARN LIMITED ASX:VYS