Hydrix Ltd Investor Update April 2019 Development and - - PowerPoint PPT Presentation

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Hydrix Ltd Investor Update April 2019 Development and - - PowerPoint PPT Presentation

Hydrix Ltd Investor Update April 2019 Development and commercialisation of technologies that enhance peoples health, safety and well -being Slide 1 Hydrix | Investor Update | 1 April 2019 Disclaimer This presentation has been prepared by


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Slide 1 Hydrix | Investor Update | 1 April 2019

Hydrix Ltd

Investor Update April 2019 Development and commercialisation of technologies that enhance people’s health, safety and well-being

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Slide 2 Hydrix | Investor Update | 1 April 2019

Disclaimer

This presentation has been prepared by Hydrix Limited (the “Company” or “Hydrix”). This presentation is being provided to investors for the sole purpose of providing preliminary background financial and other information to enable recipients to review the business activities of the Company. The document is not intended to constitute an invitation or an inducement to engage in any investment activity. The presentation is not intended to constitute investment advice and should not be relied upon as such. This document is not intended as an offer or recommendation with respect to the purchase or sale of any securities in the Company. The content and graphical illustrations contained in the presentation are provided for information purposes and should not be relied upon to form any investment decisions or to predict future performance. The Company is wholly reliant upon third parties for the accuracy and completeness of the information in the presentation and has no duty of care owed to you in relation to such information. Although the information expressed is provided in good faith and the Company believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from those included in the forward-looking statements include amongst others, unforeseen delays in product development, the timing and extent of any changes in the associated technology and the ability of the Company to meet its stated business goals. Prospective investors should make their own independent evaluation of an investment in the Company or seek advice from their financial adviser, accountant, lawyer, stockbroker or other professional adviser before making any investment decision. Nothing in this presentation should be construed as financial product advice, whether personal or general, for the purposes of Section 766B of the Corporations Act, or otherwise. This presentation does not amount to, involve or imply a recommendation or a statement of opinion in respect of whether to buy, sell or hold a financial product. Neither Hydrix nor any of its or their associates or any of the Company’s directors’ (Hydrix Group) shall have any liability whatsoever for: (a) investment advice; (b) a recommendation to enter into any transaction or strategy; (c) advice that a transaction or strategy is suitable or appropriate; (d) the primary basis for any investment decision; (e) a representation, warranty, guarantee with respect to the legal, accounting, tax or other implications of any transaction or strategy; or (f) to cause the Hydrix Group to be an advisor or fiduciary of any recipient of this report or other third party. None of Hydrix shall be responsible for or have any liability to you for losses or damages (whether consequential, incidental or otherwise) arising in any way for errors or

  • missions in, or the use of or reliance upon the information contained in this document. To the greatest extent permitted by law, we exclude all conditions

and warranties that might otherwise be implied by law with respect to the document, whether by operation of law, statute or otherwise, including as to their accuracy, completeness or fitness for purpose. Unauthorised copying of this document is prohibited.

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Slide 3 Hydrix | Investor Update | 1 April 2019

Hydrix today

Hydrix brings together a unique set of skills to solve complex problems and develop pioneering technology in large, fast growing, global target markets

Consumer er & Indu dustr tria ial

  • Utilities
  • Agricultural Tech
  • Internet of Things
  • Mining (USD$16Bn annual

market by 2025)

Critica ical systems ems

  • Rail (AUD$100bn over next

decade)

  • Security
  • Defence (Australian Defence

budget AUD$250B over next decade)

Medi dical al Tech

  • Cardiac
  • Neurostimulation
  • IVF
  • Robotics

Healthcare is a US$7.8T annual market

Hydrix’s capabilities include:

  • Software
  • Electronics
  • Mechanical Design
  • Industrial Design
  • Regulatory Consulting
  • CAD
  • Physics
  • Thermal Analysis
  • Robotics
  • Rapid prototyping & 3D Printing
  • Transfer to Manufacture
  • Manufacturer Selection &

Management

  • Supply Chain Audit
  • Product Supply
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Slide 4 Hydrix | Investor Update | 1 April 2019

A diversified fee-for-service product design & commercialisation business

  • 1. Innovate
  • 2. Design
  • 3. Engineer
  • 4. Prototype
  • 5. Manufacture

✓ Develop pioneering technology to deliver successful product innovation for our clients ✓ Breadth of capability from idea generation to commercialisation ✓ Delivered 200+ products over the last 15 years ✓ Strong track record of success locally and internationally

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Slide 5 Hydrix | Investor Update | 1 April 2019

A proven portfolio of projects, clients and industries

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Slide 6 Hydrix | Investor Update | 1 April 2019

A diverse array of sophisticated design projects

Selection of Current Projects: Cardiac Assist Devices for Heart Failure Patients

  • Currently operating three simultaneous projects: UK, France & USA (Inc.

total artificial heart)

Powered robotic exoskeleton for stroke victims Next generation site protection Treatment for Alzheimer’s disease IVF assistance device Smart Meter Technology Smart Mining Innovation

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Slide 7 Hydrix | Investor Update | 1 April 2019

Delivering strong revenue growth

$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18

Audited Quarterly Revenue ($'000)

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Slide 8 Hydrix | Investor Update | 1 April 2019

Met or exceeded all 1H FY19 milestones

Milestones 1H FY19 Updates Minimum 15% revenue growth compared to 2H18 Exceeded → 1H19 revenue of $5.7m represents 43% growth on 2H18 revenues of $4.0m 15% increase in engineering services capacity Exceeded → 25% headcount increase in engineers and designers to current 60 personnel Secure three new significant and high-dollar value projects Achieved → Rex Bionics, Gyder Surgical and large Utility (commercial-in-confidence) 20% reduction in cash used in

  • perating activities in the

December quarter against September quarter Exceeded → 27% reduction in cash used from $1.8m in 1Q19 to $1.3m in 2Q19 Implement Buy, Build, Invest strategy Buy → Continue efforts to identify strategic acquisitions Build → Implemented internal product identification opportunity program. Invest → Established strategic equity partnership in Gyder Surgical P/L, Memphasys (ASX:MEM)

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Slide 9 Hydrix | Investor Update | 1 April 2019

On track to meet or exceed 2H FY19 milestones

Milestone Aspirations 2H FY19 Status Minimum 15% revenue growth in H2 compared to H1 On Track Solidify global leadership position engineering cardiac assistance control devices On Track Secure three significant and high-dollar value projects On Track Targeting break-even in 4Q FY19 On Track Identify our next acquisition or equity investment opportunity On Track

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Slide 10 Hydrix | Investor Update | 1 April 2019

A vision and clear strategy that drives growth

Development and commercialisation of technologies that will enhance people’s health, safety and well-being

To be a sought-after world class developer and provider of pioneering technology products & services Best practice in project

  • perations

delivery, and client satisfaction Attract and retain the best design and engineering minds and problem solvers Grow services revenues and profitability Build a robust and world-class, fee-for- service design and engineering business Leverage design & engineering capability to build a portfolio of product and IP-based business Grow recurring product and IP based revenues

Vision Mission Strategy Targets Increased business and shareholder value

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Slide 11 Hydrix | Investor Update | 1 April 2019

Growth from fee-for-design services, buying & building pioneering products and making strategic investments in customers

Develop Products Invest Take equity Acquire Monetise

Leverage core engineering and design capability to develop our own products & IP

Diversified product & IP portfolio Strategic growth activity Current world-class engineering services Value creation

Medical Technology Consumer & Industrial Critical Systems & Defence Hydrix provides a unique opportunity to gain access to a diversified technology development and products company at the start of its growth trajectory

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Slide 12 Hydrix | Investor Update | 1 April 2019

Well placed for future growth

In summary, we have:

  • Clear vision and strategy for growth in providing services and

developing our own products for fast-growing target markets

  • Increasing global demand for our advanced engineering and

design services developed over 15+ years

  • Scale to take on big global projects with over 50 world class,

professional designers and engineers

  • Trusted relationships with major global companies including GE,

Cochlear, Philips, Siemens and others

  • Global clients and investment opportunities attracted to Australian

R&D tax incentives, cost effective exchange rates and (in MedTech) strong clinical trials reputation

  • Ability to work in high-end Class III medical and safety critical

domains representing skills that are in demand globally

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Appendix 1

Corporate and Board overview

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Slide 14 Hydrix | Investor Update | 1 April 2019

A long term, supportive shareholder base

30-32 Compark Circuit, Mulgrave, VIC 3170 Australia

Capital Structure (as of 28 Mar. 2019) Ticker HYD Share Price $0.02 Shares on Issue (m) 669.1 Options and Performance Rights (m) 41.7 Fully Diluted Shares 710.8 12-month Range $0.019 - $0.096 Market Capitalisation ($m)1 $12.7m Enterprise Value $16.7m Major Shareholders Shares (m) % John W King Nominees 144 22% Lion Tail Trading Pty Ltd* 43 7% Kurrawonga Pty Ltd 19 3% Flet Superannuation Pty Ltd 15 2% Goetzke Super Company 14.5 2% Top 10 283m 42% Top 20 346m 52%

* 25m in escrow until Nov. 19

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Slide 15 Hydrix | Investor Update | 1 April 2019

A highly experienced board & executive leadership team

Gavin Coote GAICD

Non-Executive Chairman 9.7m shares

Julie King GAICD

Non-Executive Director 114.2m shares 25+ years’ financial leadership building business in the US and Australia across technology healthcare and industrial sectors 35+ years experience in corporate communications, people and change management

Joanne Bryant

Non-Executive Director 11.4m shares 35+ years experience in workplace performance and organisational culture

Paul Wright FAICD

Non-Executive Director

  • Peter Lewis AM

Chief Executive Officer 2m shares 30+ years’ experience in leading and growing large- scale, multinational engineering product design & manufacturing companies 30+ years’ experience in leading technology-based

  • rganisations in product

commercialisation, business development, international sales & marketing, and M&A

The Hydrix Board and Executive Team possess wide ranging experience and proven skills across: Finance, Strategy, Governance, Capital Markets, Technology, IP and our target industry sectors of MedTech, Industrial, Consumer and Defence

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Appendix 2

Selected fee-for-service project case studies

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Slide 17 Hydrix | Investor Update | 1 April 2019

Proven Track Record – Design & Manufacture of Advanced Rail Communications System

Radio Interface Unit for Victorian Digital Train Radio System

  • Provides Global Navigation Satellite System (GNSS),

telemetry, data & communications

  • Interface to digital radios, analogue radios & PA
  • Feeds wirelessly to control room over propriety network
  • Fully bespoke power supply design to rail stringent

requirements

  • High performance Linux based system
  • Design to vibration, shock, EMI, EMC & IP requirements
  • Full product verification
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Slide 18 Hydrix | Investor Update | 1 April 2019

Proven Track Record – End to End Design & Development of Unique X-Ray System

Portable radiography using nanotechnology (from concept to FDA certification in 18 months)

  • Software development (power management & x-ray fire

control)

  • Software HMI Design and Development
  • Human Factors and Industrial Design
  • Full System and Software Integration
  • Formal Verification and Validation and FDA certification

Management (IEC 62304, Class 2 Medical Device, Safety Related)

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Slide 19 Hydrix | Investor Update | 1 April 2019

Proven Track Record – Design of Controller for a Total Artificial Heart

Development of control systems for Ventricular Assist Devices (LVADs) and Total Artificial Hearts (TAHs)

  • Hydrix is a world leader in developing this technology
  • Hydrix has completed two successful clinical trial

controllers and is currently developing 4 more controllers for LVADs and TAHs. Hydrix manages the end to end development of the controllers

  • Program management and systems integration
  • Usability analysis and design
  • Mechanical design & analysis
  • Safety critical embedded software and electronics

design

  • Prototype build and test
  • Transfer to manufacture
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Slide 20 Hydrix | Investor Update | 1 April 2019

hydrix.com

30-32 Compark Circuit Mulgrave VIC 3170 Australia ASX:HYD