Altech Batteries Ltd Stock Market Press Releases and Company Profile
Half Year Accounts
Half Year Accounts

Perth, Mar 13, 2020 AEST (ABN Newswire) - During the half-year ended 31 December 2019, Altech Chemicals Ltd (googlechartASX:ATC) (googlechartA3Y:FRA) continued with stage-1 and stage-2 construction activities at the site of its proposed high purity alumina (HPA) plant in Tanjung Langsat, Johor, Malaysia.

In October 2019, the EPC contractor consortium (German engineering firm SMS group and its Malaysian subsidiary Metix) formally handed-over to Altech the completed stage-1 facilities. The facilities consisted of the maintenance workshop building; all site retaining walls; and the on-site stormwater detention tanks. At the time of facilities hand-over the contractor consortium had completed approximately 100,000 lost time injury free working hours with zero first aid or medical treatment incidents and zero lost time injuries - a testament to the professionalism of the consortium and the various sub-contractors working on the site. During the latter part of the period covered by this report, construction activities moved to the electrical sub-station, whilst stage-2 engineering works and the ordering of 3rd party engineering packages was on-going.

Funding for the stage-1 and stage-2 construction and for corporate and other head-office costs during the half-year was provided from the issue of additional equity (shares) by the Company. During the period Altech raised $3.7 million (net of costs) via share placements to existing shareholders MAA Group Berhad (Melewar group) ($2.0 million), Deutsche Balaton / Delfi ($600,000) and to a range of professional and sophisticated investors, many of whom are long-term shareholders. In December 2019, the Company also initiated a share purchase plan (SPP) whereby all existing shareholders could apply for up to $30,000 of new Altech shares at a price of $0.0975 each, free of any brokerage or other transaction costs. The SPP closed in January 2020 and was well supported with a total of $2.8 million raised.

The Company continued with its efforts to finalise overall project financing for its HPA project during the half-year. On 18 July 2019, the Company announced that it had launched a German project equity strategy whereby Altech would acquire a 29% shareholding in a Frankfurt Stock Exchange listed company Youbisheng Green Paper AG (since renamed to Altech Advanced Materials AG)(AAM) and Altech would sell an option to AAM for EUR500,000, providing the opportunity for AAM to acquire a shareholding of up to a 49% direct interest in the Company's HPA project for US$100 million (via subscribing to shares of Altech Chemicals Australia Pty Ltd, the wholly owned subsidiary of Altech which currently holds 100% of the Company's HPA project).

Completion of Altech's acquisition of 29% of AAM was announced on 16 August 2019, and the Company issued 19,513,204 fully paid ordinary shares and made a cash payment of EUR500,000 as part consideration, a balance of EUR1,229,000 (the deferred consideration) was due on 1 March 2020, but has been now deferred to 1 September 2020 by agreement with the vendor, Deutsch Balaton AG. Following completion of the acquisition, Altech's managing director Iggy Tan and alternate director Uwe Ahrens were appointed to AAM's 3-person supervisory board, and the Company also finalised the sale of the option to AAM with the EUR500,000 of sale funds received. The option is exercisable by AAM in whole (a 49% project interest) or in part (a minimum 20% interest) up until 1 January 2021. During the half-year AAM advised Altech that it had commenced the process of raising funds to position it to exercise its option. AAM is aiming to initially raise up to EUR 69.4 million (~A$113.7m) of new equity via a 40:1 rights offer to existing shareholers followed by a placement of shares to external investors.

Senior project debt provider, German government owned KfW IPEX-Bank remains committed to the provision of a US$190 million loan facility for the Company's HPA project and the Company continued to work with preferred mezzanine lender Macquarie Bank during the half-year to secure a US$90 million mezzanine loan. In addition to these two facilities the HPA project requires approximately US$100m of further funding to position it for financial close, as in addition to the total project capital cost estimate of US$298m published in the project Financial Investment Decision Study (ASX announcement 23-Oct-2017), the senior lender requires pre-funding of a contingency reserve account of US$28 million, a debt service reserve account of a similar amount, pre-funded working capital of US$21m and various bank fees and lending charges need to be funded. The Company anticipates that the exercise by AAM of its US$100m option to acquire a 49% project interest would be a catalyst for project financial close. The Company is supporting AAM with its capital raising efforts via joint presentations to potential investors, providing data-room access and various due diligence reports, and arranging for the placement of alternate director Uwe Ahrens (a German national) in Germany from January 2020 to assist in raising project awareness and promoting connections with potential European end users of HPA.

The outlook for HPA demand and pricing continues to be positive and in July 2019 the Company announced the results from an updated base-case HPA demand forecast published by London based CRU Consulting. In its report CRU has forecast both mid-term (2020-23) and long-term (2026-28) supply gaps for HPA, driven by forecast increased demand for high quality 4N+ HPA from the lithium-ion battery industry (ceramic coated battery separators) and also synthetic sapphire producers (light emitting diodes).

In December 2019, Altech was pleased to announce that the Ministry of Finance, Malaysia had approved the application by the Company's wholly owned subsidiary Altech Chemicals Sdn Bhd, for an Investment Tax Allowance (ITA) under the high technology category for the Company's HPA project. The ITA is awarded for a period of 10 years following commencement of operations and modelling by Altech shows that application of the allowance is likely to result in no profits tax on Malaysian statutory business income until after year 10 of operations, which is important as it will make all earning available to service debt or provide for dividends.

To view the report, please visit:
https://abnnewswire.net/lnk/9VY14C1W


About Altech Batteries Ltd

Altech Chemical Ltd ASX:ATCAltech Batteries Limited (ASX:ATC) (FRA:A3Y) is a specialty battery technology company that has a joint venture agreement with world leading German battery institute Fraunhofer IKTS ("Fraunhofer") to commercialise the revolutionary CERENERGY(R) Sodium Alumina Solid State (SAS) Battery. CERENERGY(R) batteries are the game-changing alternative to lithium-ion batteries. CERENERGY(R) batteries are fire and explosion-proof; have a life span of more than 15 years and operate in extreme cold and desert climates. The battery technology uses table salt and is lithium-free; cobalt-free; graphite-free; and copper-free, eliminating exposure to critical metal price rises and supply chain concerns. 

The joint venture is commercialising its CERENERGY(R) battery, with plans to construct a 100MWh production facility on Altech's land in Saxony, Germany. The facility intends to produce CERENERGY(R) battery modules to provide grid storage solutions to the market.

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Contact

Corporate
Iggy Tan
Managing Director
Altech Batteries Limited
Tel: +61-8-6168-1555
Email: info@altechgroup.com

Martin Stein
Chief Financial Officer
Altech Batteries Limited
Tel: +61-8-6168-1555
Email: info@altechgroup.com



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