for personal use only - asx2012/11/05 · not constitute an offer, invitation, solicitation or...

Silex Systems

Investor Presentation

November 2012

Dr Michael Goldsworthy – CEO

© Silex Systems Limited 2012

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Forward Looking Statements


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Silex is a research and development Company whose assets include its proprietary rights in technologies, including but not limited to,

the SILEX technology, Solar Systems technology, Translucent technology and ChronoLogic technology. Several of the Company’s

technologies are in the development stage and have not been commercially deployed, and are therefore high-risk. Accordingly, the

statements in this presentation regarding the future of the Company’s technologies and commercial prospects are forward looking

and actual results could be materially different from those expressed or implied by such forward looking statements as a result of

various risk factors.

Some risk factors that could affect future results and commercial prospects include, but are not limited to, results from the uranium

enrichment development program, the demand for enriched uranium, the business risks associated with photovoltaic technology

development, manufacturing and marketing activities conducted by Solar Systems, the outcomes of the Company’s interests in the

development of various semiconductor, photonics and alternative energy technologies, the time taken to develop various

technologies, the development of competitive technologies, the potential for third party claims against the Company’s ownership of

Intellectual Property associated with its numerous technologies, the potential impact of government regulations or policies, and the

outcomes of various commercialisation strategies undertaken by the Company. Accordingly, the inclusion of forward looking

information in this presentation should not be regarded as a representation or warranty with respect to its accuracy or the accuracy of

the underlying estimates or assumptions or that Silex will achieve or is likely to achieve any particular results.

The forward looking statements included in this presentation involve subjective judgment and analysis and are subject to significant

business, economic and competitive uncertainties, risks and contingencies, many of which are outside the control of, and are

unknown to Silex. Given these uncertainties, you are cautioned to not place undue reliance on such forward looking statements.

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Disclaimer


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Silex Systems Ltd (Silex) has prepared this presentation based on information available to it. The information in this presentation

does not purport to be a complete description of Silex and/or its various business activities. Except as required by law, no

representation or warranty, express or implied, is made by Silex as to the fairness, accuracy, completeness or correctness of the

information, opinions and conclusions contained in this document and discussed in the presentation, or as to the reasonableness of

any assumption contained in this presentation. By receiving or viewing this presentation and to the extent permitted by law, you

release Silex and its directors, officers, employees, agents and affiliates from any liability (including, without limitation, in respect of

direct, indirect or consequential loss or damage or loss or damage, arising by negligence) arising as a result of the reliance by you

any other person on anything contained in or omitted from this presentation.

This presentation should be read in conjunction with other disclosures that have been lodged by the company with the Australian

Stock Exchange.

No responsibility is accepted by Silex or any of its directors, officers, employees, agents or affiliates, nor any other person, for any of

the information contained in this document and discussed in the presentation or for any action taken by you on the basis of the

information or opinions expressed in the course of this presentation. This presentation does not constitute investment, legal, taxation

or other advice and the presentation does not take into account your investment objectives, financial situation nor particular needs.

You are responsible for forming your own opinions and conclusions on such matters and should make your own independent

assessment of the information contained in this document and discussed in the presentation and seek independent professional

advice in relation to such information and any action taken on the basis of the information.

This document is not a product disclosure statement or prospectus for the purposes of the Australian Corporations Act 2001 and does

not constitute an offer, invitation, solicitation or recommendation in relation to the subscription, purchase or sale of shares or other

securities in any jurisdiction, including in the United States or to any U.S. person, and neither this document nor anything in it shall

form the basis of any contract or commitment. Securities may not be offered or sold in the United States, or to or for the account of

any U.S. person, unless the securities have been registered under the U.S. Securities Act of 1933 or an exemption from registration is

available.

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Corporate Overview


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• Silex Systems Limited is an ASX-listed company focussed on development and commercialisation of technologies across three platforms:

• Nuclear Energy

• Solar Energy

• Advanced Materials & Instrumentation

Company Description

ASX Ticker: SLX

Market Capitalisation: ~$600 million (November 2012)

Shares on Issue: 170.2 million (November 2012)

• XAO – All Ords

• XSO – S&P / ASX Small Ords

• XKO – S&P / ASX 300

Index Inclusion

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Businesses


Silex Systems

Third generation laser

uranium enrichment for nuclear power

Solar Systems

Utility Scale Concentrating PV power generation

Translucent

Game changing semiconductor and LED

substrate materials

Chronologic

Precision instrumentation via distributed ‘USB-in

SyncTM‘ platform

Technology Commercialisation

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Section 2

SILEX Uranium Enrichment Technology


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Uranium Enrichment


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Mine uranium

Convert to UF6

Enrich uranium

Fabricate fuel

Use in reactor

Produce electricity

Uranium Enrichment

• Uranium must be enriched to work as fuel in a nuclear reactor

• Process to enrich U235 isotope from 0.7% to ~5%

Uranium Enrichment Processes

• Gas Diffusion – first generation, obsolescent

• Centrifuge – second generation, primary competition

• Lasers – third generation, SILEX unchallenged

Advantages of Laser Enrichment

• Significantly more efficient - uses less energy

• Smaller footprint than centrifuge and diffusion

• Lowest capital costs of all enrichment technologies

SILEX Technology

• The only third generation laser based technology being

commercialised in the world.

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Commercialisation and License Agreement

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Global Laser

Enrichment (GLE)

51% 25% 24%

Exclusive Worldwide

Commercialisation and

License Agreement

Exclusive Agreement

• Exclusive worldwide commercialisation and license

agreement for SILEX Uranium Enrichment Technology

• Agreement originally with GE signed in 2006

Next Milestone Payments

• USD 15 million due upon successful completion of Test

Loop program & NRC licensing of initial commercial plant

• USD 20 million due upon licensing / completion of the Lead

Cascade (initial commercial module)

Perpetual Royalty

• Perpetual royalty based on GLE revenues

• Royalty range of 7% to 12%

• Royalty range dependent on defined calculation for capital

costs per unit of enrichment capacity deployed

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Approach to Commercialisation

GLE’s phased approach to commercialisation

• Completion of the Test Loop Program

• Construction of an initial commercial production module

• Construction of a full-scale commercial production facility

GLE’s commercial focus

• GLE targeting a production capacity of up to 6 million SWU

(enrichment production units) for initial commercial facility

• Preliminary Marketing of Laser Enrichment Services underway

• Letters of Intent signed with US nuclear power utilities Exelon,

Entergy and TVA

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GLE Commercial Facility - NRC Licence

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Commercial Facility Licence

•US Nuclear Regulatory Commission (NRC) responsible for

evaluating combined construction and operating license

•Construction and operating license application submitted to NRC in

July 2009 for the first proposed plant in Wilmington, North Carolina.

NRC Issued the Commercial Plant Licence on 25th September 2012

•First ever license for a laser enrichment plant in the world!

•GLE can proceed to construct the first planned commercial plant - a

decision on these plans is likely in 2013.

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Nuclear Energy in the United States

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Source: Nuclear Energy Institute

104 nuclear reactors in 31 states

Nuclear 19%

Electricity generation by fuel type

Coal Gas Nuclear Hydro Renewables Oil

Source: Global Energy Decisions / Energy Information Administration

Current Reactors

• 104 nuclear reactors operating in 31 states

• ~27% of global nuclear energy capacity is in the US

• ~20% of electricity in the US is generated from nuclear energy

• Nuclear energy is the lowest cost producer of base load electricity Future Developments

• NRC recently approved the construction and operating licenses

for 2 new nuclear power plants in Georgia and 2 new units in

South Carolina.

• ~30 new plants under consideration or planning

• Electricity demand will increase 25% by 2030

• Up to 300 new power plants could be required by 2030

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Nuclear Energy Worldwide

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Proposed nuclear reactors

Source: World Nuclear Association and Shaw

Global Issues

• Energy security and Climate Change are key concerns

of Governments and Utilities around the world

• Nuclear ‘renaissance’ to continue despite short-term

impact of the Fukushima event

Global Nuclear Capacity to Increase

• Potential increase in nuclear capacity from 434 plants

today to ~1000 plants over next 2 decades:

• 2012: 373 GWe

• 2030: 1,000 GWe (WNA estimate)

Uranium Enrichment Market

• 2012: ~$7 billion per annum

• 2030: ~$20 billion per annum (estimate)

15 percent of global electricity

434 operating reactors

64 new plants under construction

160 plants planned

323 plants proposed

Key Statistics

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Section 3

Solar Systems CPV Dish Technology and Utility Scale Projects

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Cutting-Edge Solar Technology – developed in Victoria, Australia

• Silex Systems invested in March 2010.

• Core technology underwent major redesign – completed September 2012.

• Manufacturing facility modified and commissioned – now in production. For

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Technology Background

Installation Location Capacity Dishes

Bridgewater Vic, Australia 600kW 16

Hermannsburg NT, Australia 190 kW 8

Yuendumu NT, Australia 240 kW 10

Lajamanu NT, Australia 290 kW 12

Windorah Qld, Australia 175 kW 5

Total 1,495 kW 51

Yeundumu Solar Facility

Hermannsburg Solar Facility


Key Highlights

• Multi-junction cells introduced 2005 – from space/satellite industry.

• Current efficiency >40% (~ 2x efficiency of silicon cells, ~ 4x

efficiency of thin film cells) with roadmap to >50% efficiency

• Solar Systems unique dense array format with active cooling –

maximum power output and potentially longer lifetime

• Reliable, integrated, manageable power stations

• 5 power plants installed in three states

• Over 100 dish years of experience accumulated

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Product Commercialisation Plan – 2010 to 2015

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Phases & Funding Contributions

•Phase 1 – Product Commercialisation Program: completed September 2012.

o Product Release Milestone: completed June 2012. Involved completion

of the Dense Array Dish Test System – 16 units installed at Bridgewater.

o Funding Contribution: Victorian Government $5 million.

•Phase 2 – Pilot Demonstration Facilities: work ongoing

o Mildura Stage 1: 1.5MW facility (40 Dish units) under construction.

Completion expected mid 2012.

o Funding Contribution: Victorian Government $10 million

o Nofa, Saudi Arabia (under construction) and Beaumont, USA (2013)

• Phase 3 – Commercial Projects: Global deployment of utility scale projects

o Mildura Stage 2: 100MW power station – construction planned 2014-15

o Funding Contributions: Federal Government $75 million and Victorian

Government $35 million.

o Ongoing deployment of global CPV project opportunities.

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Economic Validation – LCOE

• Economics driven by efficiencies and

volume production

• Key cost metric: LCOE Capex +

Energy Yield + O&M + Finance

Current Development Pipeline

Project Location Capacity Dishes Planning Construction

Commencement

Expected

Completion

Mildura (Stage 1) Victoria, Australia 1.5 MW 40 Completed Q2 FY 2012 Q4 FY 2013

Mildura (Stage 2) Victoria, Australia 100 MW ~ 3,000 Underway FY 2014 (est.) TBA

Nofa Tibrak, Saudi Arabia 1 MW 28 Completed Q1 FY 2013 Q3 FY 2013

Beaumont California, USA Up to 1 MW 28 Underway Q1 FY 2014 (est.) Q2 FY 2014

Total Up to 104 MW ~ 3,096


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Direct Normal Irradiance

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Bridgewater Test & Demonstration Facility

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Bridgewater Test and Demonstration Facility

Commissioned in June 2012

• Largest concentrating photovoltaic power station in Australia

• 16 unit - 600 kW testing and demonstration facility

• Real time data logging, reliability and performance testing

• Will enable quick implementation of further technology

improvements to reduce electricity costs (LCOE)

• Grid connected, with first commercial power purchase

agreement (PPA) signed with Diamond Energy

• Officially opened 28 June 2012

Additional Testing at Bridgewater

• 12 Mini-Dishes installed (concentration up to 1,000 suns)

• Heliostat Power Tower (2nd generation technology) under development

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Mildura Stage 1

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Mildura (Stage 1): Plans

Mildura (Stage 1): Construction Works

2011 – 2013: Construction Phase

• 1.5MWDC CPV grid connected power plant (40 dish units)

• Permits and approvals completed

• Transmission Connection Agreement signed with Powercor

• Site works commenced in Q4 2011

• Expected completion in first half of 2013

• Funding contribution of $10 million from Victorian Government

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Mildura Stage 2 – 100MW Solar Power Station

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Artist impression: Mildura (Stage 2)

2012 – 2013: Planning & Preparation Activities

• Final design for Stage 2 modular CPV power arrays

• Evaluation of connection point to nearby grid line

• Preliminary partner discussions (financing, construction,

connection & transmission)

• Power purchase agreement negotiations

• EPC tender process

• Commencement of construction expected in 2014

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Bridgewater

CPV Facility

Hervey Bay

Hospital PV System

Peak Power (@ module) ~ 600kWDC ~ 270kWDC

Total Area (system) 2,000m2 1,670m2

Total Module Area 4m2 1,670m2

Concentration 500 x (future 1000 x) 1 x

Power Density (@ module) ~ 150,000 W/m2 ~ 160 W/m2

Cell Type III-V Multi-Junction Mono-Silicon

Cell Efficiency ~ 40% ( 50+% future) ~ 18% ( 20+% future)

Energy Yield (Location dependent)

1.5 ~ 1.8

(dual axis tracking)

1.0

(fixed mount)

LCOE (Current range) 15 ~ 20c / kWhr 20 ~ 25c / kWhr

LCOE (Future potential) < 10c / kWhr ~15c / kWhr

CPV vs PV – Basic Comparison

(All figures are estimates for discussion purposes only, sourced from various industry references and

internal information. Note – this table does not include all data relevant to the comparison as presented.)

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Section 4

Translucent

Advanced Materials Technology


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Rare Earth Oxide (REO) – Platform Technology

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Key Benefits

• Several industries forced to use high-cost non-silicon substrates (eg

Germanium, Sapphire and Silicon Carbide) for high-end applications

• Translucent’s innovative REO platform could enable use of large low-

cost silicon wafers

• Overcomes traditional barriers (wafer bowing and cracking) in the

transition to silicon wafers

Applications

• LED Lighting substrates

• Power Electronics devices

• CPV Solar cell substrates

Basic REO substrate structure

$300m

$500m

$500m

LED Lighting substrates

Power Electronics devices

Solar CPV substrates

Total Accessible Market $1.3 billion

* Estimates based on industry information (CPV Consortium,

Yole, OIDA Research, Electronicast, LEDSTAR) and internal

information.

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Technology Applications

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LED Lighting

• Lowers cost compared to sapphire wafers

• Improves performance

• Rare earth oxide enables engineered low-bow wafers and excellent LED mirror layers

Power Electronics

• Lowers cost compared to sapphire wafers


• Rare earth oxide enables engineered low-bow wafers

Solar CPV • Lowers cost compared to

germanium wafers


• Novel MJ (multi-junction) layers 50% + efficiency target

Lowers cost, improves performance

Silicon

cREOTM

MJ Layers

Silicon

cREOTM

GaN

Silicon

cREOTM

GaN

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LED Lighting

•Engaged with customers in USA and Asia

•Strong demand to test Mirrored-Si™ wafers for LED fabrication

•Initial commercial orders for sample evaluations (up to 150mm wafers)

•Work continues for the development of 200mm wafers

Power Electronics

•Engaged with customers in USA, Europe and Asia

•Strong interest for 100mm and 150mm vGaN™ wafers for FET device fabrication

•Repeat commercial orders for sample evaluations of vGaN™ wafers

•Higher margin vFET™ wafers being prepared for evaluation

•Work continues for the development of 150mm vGaN™ and vFET™ wafers

CPV Solar Cells

•Initial engagement with customers in USA, Europe and Asia

•Project has received $2m grant funding from Australian Solar Institute (ASI)

•Second Milestone – CVD production reactor – almost completed

•Project partner Solar Systems will benefit directly from this key project.

Translucent REO wafers

Commercial Progress

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Section 5

ChronoLogic

Instrumentation Technology


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Business Development Opportunities

• Chronologic has embarked on an exhaustive process to

secure appropriate strategic partners

• Strong interest from potential global commercial partners

• Discussions with commercial companies regarding potential

divestment strategy ongoing

Core IP

• Core USB-inSync™ IP has spawned 17 patent families –

expected to generate over 40 individual patents

• 10 key patents so far granted in the USA, Europe, Australia,

India and Canada

• Additional multi-patent applications filed and pending

Product Markets

• Data Acquisition

• Test & Measurement

• Precision Timing Market

Chronologic

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for personal use only - asx2012/11/05 · not constitute an offer, invitation, solicitation or...

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