Lycopodium : AGM Presentation 2019

Annual General

Meeting 2019

Delivering engineering excellence, value and innovation	21 November 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).

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Corporate Overview

Michael (Mick) Caratti

Chairman

Justine Campbell

Chief Financial Officer

Share Price

(as at 15.11.19)

$5.30

Shares on Issue

39.7m

Lawrence (Laurie) Marshall

Non-Executive Director

Market

Capitalisation

~$217.7m

Peter De Leo	Bruno Ruggiero	Peter Dawson
Managing Director	Executive Director	Executive Director

Cash at Bank

(as at 30.6.19)

$60.5m

Robert (Bob) Osmetti	Steven Chadwick	Rodney (Rod) Leonard
Non-Executive Director	Non-Executive Director	Non-Executive Director

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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 - 1.811

1 Against Construction Industry frequency rate of 8.1

(Safe Work Australia, Australian Workers' Compensation Statistics, 2016-17)

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Core Capabilities

Sectors		Services

	Resources		Infrastructure		Industrial Processes
•	Gold and Precious Metals	•	Railways	•	Pharmaceuticals	•	Feasibility Studies
•	Base Metals	•	Roads	•	Biotechnology	•	Process Development and Optimisation
•	Battery Metals	•	Ports	•	Chemical and Energy	•	Engineering and Design
•	Specialty Metals	•	Non-process Resource	•	Food and Beverage	• Project Management and Delivery
•	Diamonds and Gemstones		Infrastructure	•	Manufacturing	•	Project Services
•	Bulk Minerals	•	Asset Management	•	Research and Development	•	Construction Management

•	Iron Ore			• Commissioning and Operations Support
•	Minerals Sands			• Asset Management
•	Bauxite
Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Locations

Toronto

CA

Manila

PH

During FY2019:

Johannesburg

SABrisbane

• Established additional offices

in South Africa to support

Cape Town

SA

AUS

African operations.

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

Delivering engineering excellence, value and innovation

Perth

AUS

Newcastle

AUS

Melbourne

AUS

Annual General Meeting 2019

FY2019 Group Highlights

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

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

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.
• 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.

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

FY2019 Revenue by Sector

	FYE Jun-19	4%
Sector	A$'000	7%
Resources	136.8
Infrastructure	11.6
Industrial Processes	5.7

89%

154.1

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

FY2019 Revenue by Geography

	FYE Jun-19	9%
						19%
						6%
	Sector		A$'000
	Australia	29.6
	Africa	100.8
	Americas	9.7
	Other	14.0
		154.1		66%
Delivering engineering excellence, value and innovation			Annual General Meeting 2019

FY2019 Balance Sheet

	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

Strong	Cash on hand of
$60.5m
Balance

Sheet	as at 30 June 2019

Net Tangible Assets per Share	Minimal
182.9 cents	Debt

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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 above- average 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.

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Major Projects

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Cobré Panama

SECTOR	Resources
CLIENT	First Quantum Minerals
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

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

"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.

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Ity

SECTOR	Resources
CLIENT	Endeavour Mining Corporation
LOCATION	Côte d'Ivoire
COMMODITY	Gold
	• EPCM services for the gold
SCOPE	CIL plant
• EPCM services to increase
	capacity to 5 Mtpa
PROCESSING	5 Mtpa
CAPACITY

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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."

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Toka Tindung

SECTOR	Resources
CLIENT	PT Archi Indonesia
LOCATION	Indonesia
COMMODITY	Gold
	• EPCM services for throughput
	upgrade of the process plant
SCOPE	facilities
	• Capacity increase from 2.4
	Mtpa to 3 Mtpa
PROCESSING	3 Mtpa
CAPACITY

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Wahgnion

				SECTOR	Resources
				CLIENT	Teranga Gold Corporation
				LOCATION	Burkina Faso
				COMMODITY	Gold
					• Full EPCM services for the
					design and construction of the
				SCOPE	process plant
				• Engineering design for support
					infrastructure, including
					accommodation village
				PROCESSING	2.7 Mtpa
				CAPACITY
Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Bonasika

SECTOR	Resources
CLIENT	Guyana Industrial Minerals
LOCATION	Guyana
COMMODITY	Bauxite
SCOPE	•	Detailed engineering
•	Technical procurement support
PROCESSING	•	350 Ktpa
CAPACITY

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Montepuez Ruby Mines

SECTOR Resources

CLIENT Gemfields

LOCATION Mozambique

COMMODITY Gemstones

SCOPE

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

• Installation and commissioning of the Recovery Plant

• Designed to incorporate UV- sorting technology

Sanbrado

SECTOR	Resources
CLIENT	West African Resources
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

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Mt Cattlin

SECTOR	Resources
CLIENT	Galaxy Lithium Australia
LOCATION	Ravensthorpe, WA
COMMODITY	Lithium
	• Design and construction of four
	new process modules to
	increase yield optimisation of
SCOPE	the existing lithium processing
	facility
	• Awarded and delivered via
	Mondium

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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
Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Infrastructure Projects

SECTOR	Infrastructure
PROJECT	CLIENT	LOCATION	SCOPE
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

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Process Optimisation: Orway IQ

• 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.

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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.

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Strategy and Outlook: Sectors

Resources

• 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.

Infrastructure

• Market rationalisation to fit with core services we provide.
• Focus on rail infrastructure management, non-process infrastructure and infrastructure related asset management.

Industrial Processes

• 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.

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

Thank You

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

Delivering engineering excellence, value and innovation			Annual General Meeting 2019

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

Delivering engineering excellence, value and innovation			Annual General Meeting 2019