Welcome to Our Presentation - Market Eye · Welcome to Our Presentation Author: Valued Acer...
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Investor PresentationApril 2018
INTRODUCTION TO
CLOSE THE LOOP
Close the Loop - who we are
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• Australian-owned company aiming to be the global leader in sustainability solutions in
complex waste streams and data management
• Industry pioneer and market leader across Australia (HQ), USA and Europe
• Vital partner to 15 of the world’s largest printer and print consumable OEMs
• Increasingly focusing on value-added services and expanding into new vertical markets,
such as food & beverage and banking
• Vast sector experience and IP developed over 10+ years
• Listing on ASX in 2018
Close the Loop - what we are dedicated to
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“Making the Circular Economy a reality by providing
best-in-class sustainability solutions to companies that
want to enhance their Corporate Social Responsibility
through effective and efficient recovery and re-use of
valuable resources from their products. “
Close the Loop - what we do
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With commitment to ‘Zero Waste to Landfill’, we do three things to help companies manage
complex waste streams:
1. Return end-of-life products to original manufacturers (OEMs) for re-use where possible.
2. Provide data analytics and other value-add services that allow OEMs to optimise their sales
chain as well as consumable and waste stream operations.
3. Use a range of patented processes to recover all materials from those products which are
reused in the re-manufacture of those products, or turned into new innovative products.
Why do OEMs need us?
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Our services enable OEMs to:
• Maintain and develop their market share;
• Utilise key operational information that can increase their revenue and reduce costs;
• Remain regulatory compliant, where relevant.
Market levers
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• Non-genuine cartridges
• Growing recognition of Circular Economy
• Legislation in various markets
• Greater understanding of the value-add provided by Close the Loop
• Changes in the downstream plastics market (China)
Demand for CtL’s services is expected to increase in the future.
Close the Loop - how we make money
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• Annuity-style revenue model
• Multiple income streams from collection, processing and refurbishment of consumables,
and creation and sale of innovative new recycled products.
• Set fee per cartridge or kilo
• Under OEM contracts
• Collection and sorting of cartridges,
reporting on volumes collected,
recycled, refurbished or
redistributed
• Repurposed toner waste bottles
• Business intelligence services
• Recycled products such as TonerPaveTM
and TonerSealTM used in production and
repair of high quality asphalt roads
• Strong margins with further potential
from providing value-added services
• Base materials (granulated plastic and
metals including ferrous and aluminium)
automatically sorted and sold at
prevailing market rates
Well positioned to expand in existing & new markets
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Australia (established 2001)
• Headquarters in Somerton, Victoria
• Revenue $9.088m;
• Profit before tax $345k
• Over 4 million cartridges p.a.
• 50 employees
• Multi-vendor program with Planet Ark;
over 35,000 collection sites nationally
Europe (acquired October 2016)
• Malle, Belgium
• 30km from Antwerp
• Pro forma revenue A$3.290m;
• Loss before tax A$871k
• Over 3 million cartridges p.a.
• 30 employees
USA (established 2007)
• Hebron, Kentucky,
• Close to mid-west US logistics hub
• Revenue A$21m;
Profit before tax A$3.006m
• Over 40 million cartridges p.a.
• 115 employees
• Collection sites operated by OEMs
Experienced & recognised management team
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• The management team and Board have a proven track record in leading successful
businesses, and are making the Company a global ‘premier sustainability solutions
provider’.
Craig Devlin – Chairman
• Appointed to Board in 2001;
Chairman since 2009.
• 43 years’ experience as a
practicing accountant and
management consultant.
• Founder of Devlin & Co,
Accountants, and principal of
Devlin Business Development
Group Pty Ltd.
• On several Boards as either
director or Chairman.
Robert Parry-Jones – CEO
• Joined Company in 2013.
• Extensive experience across
Europe, the Middle East, Africa,
the US, and Australia, ranging
from start-up to > $1bn in
turnover.
• Strong track record of building
efficient and successful companies
with background in Biotechnology,
Medical Devices, Automotive and
Hi-Tech Electronics.
Marc Lichtenstein – CFO and
Company Secretary• Joined Company in 2017.
• CFO experience across listed and
large private companies.
• Extensive experience in leading
businesses through significant
periods of change, including
business transformation and
performance improvement
including IPOs, significant capital
raises, exponential periods of
growth and major acquisitions.
Growing market, supported by strong fundamentals
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• Close the Loop’s largest competitor is landfill.
– 75% of global imaging consumables currently end up in landfill
• Print toner market increasingly driven by robust growth in packaging
(driven by online sales).
– Counteracting the impact of the ‘paperless office’.
• Increasing rate of cartridges being recycled or remanufactured.
• Increasing social awareness, and corporate social responsibility and ESG
reporting.
Growing market, supported by strong fundamentals
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• Increased regulatory initiatives designed to protect the environment and
increase company management across the whole product lifecycle.
– EU WEEE Directive in full effect by 2019, will legislate recycling targets on IT &
telecommunications equipment
• Close the Loop is the only specialist toner cartridge recycler of any scale so
has forged strong relationships with OEMs.
• OEMs motivation to recycle as a means to reduce the potential
number of remanufactured or counterfeit products is increasing.
Expanding to other complex waste streams
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GROWTH
STRATEGY
Growth strategy
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• Five key areas for continued growth and maintaining leadership position.
Grow existing print
business by increasing
revenue per customer
and proportion of
value added services to
OEMs
Sell existing services
to new clients
Develop and sell new
internal services;
drive horizontal
growth
Geographic expansion
leveraging newly
acquired operations
and strong OEM
relationships
Acquisitive expansion
into emerging
verticals
Shifting focus to value-added services
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• New value-added services allows deeper customer penetration and expands target market
• Value-added services which are typically too costly or inefficient to implement by OEMs,
create opportunities for CtL
Refurbishment
Valet Services
Data Reports
Supply Chain
Services
Customer Audits &
IT Support
Targeting $100m in revenue by the end of 2020
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The recent acquisition
of CloZDloop in
Belgium provides a
strong platform for
expansion into Europe,
a highly
environmentally
conscious jurisdiction.
Trusted relationships
with OEMs have led to
new value add
opportunities, in
particular the cleaning
of waste toner bottles
at high margins
Currently, circa 5% of
print cartridges are
recycled in the US,
compared to 20% in
Australia, Whilst CtL is
the market leader, a
large unaddressed
market exists.
Through refined
collection programs
and legislative
recycling targets for
electronic components
being introduced in
Europe in 2018, CtL
expects to increase the
proportion of global
cartridges recycled.
CtL has identified and
commenced organic &
inorganic expansion
into new vertical
markets.
CtL will leverage its
existing infrastructure
and IP to provide
resource recovery
services to other
growth markets such
as Soft Plastics,
Separation and
Compounding.
Thank You