The Aemetis Biorefineries Commercially Operating Second Generation - - PowerPoint PPT Presentation

April 2013

The Aemetis Biorefineries

Commercially Operating Second Generation Advanced Biofuels Company

Certain of the statements contained herein may be statements of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. In addition to statements which are forward-looking by reason of context, the words “may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential, or continue” and similar expressions identify forward-looking statements. Actual results, performance or events may differ materially from those projected in such statements due to, without limitation: (i) general economic conditions, (ii) ethanol and gasoline prices, (iii) commodity prices, (iv) distillery grain soluble markets, (v) persistency levels, (vi) transportation rates for rail/trucks, (vii) interest rate levels, (viii) ethanol imports, (ix) changing levels of competition, (x) changes in laws and regulations, including govt. support/incentives for biofuels, (xi) changes in process technologies, (xii) the impact of acquisitions, including related integration issues, (xiii) reorganization measures and (xiv) general competitive factors on a local, regional, national and/or global basis, (xv) natural gas and steam prices, and (xvi) chemicals and enzyme prices. The matters discussed herein may also involve risks and uncertainties described from time to time in the company’s annual reports and/or auditors’ financial statements. The company assumes no obligation to update any forward-looking information contained herein, and assumes no liability for the accuracy of any of the information presented herein as of a future date.

Disclaimer

Agenda

 Introduction  Board / Management Team  Industry Problem & Solution  Company Background  Current / Future Developments

Our Company

Aemetis is an international renewable fuels and biochemicals company focused on the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products by the conversion of first generation ethanol and biodiesel plants into advanced biorefineries.

G1 G3

PAST PRESENT FUTURE

G2

Traditional Corn-Based Ethanol Grain Sorghum (Milo) Cyanobacteria (Blue Algae)

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Aemetis Value Proposition

 North American renewable fuels company with Emerging Market exposure  Strong management leadership with proven track record  Management team has integrated advanced technologies into existing plants  Flexible, non-food feedstock input which is non-disruptive to food supply  Higher-margin, cost-effective production with significant scalability  Already cost competitive with traditional gasoline without subsidies  Positive cash flow in international operations, with US positive in 2013

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Key Highlights: Aemetis, Inc.

• Acquired Zymetis, Inc., a novel biorefining technology company, for its patent

portfolio and production processes (2011)

• 5 granted patents on enzyme and microbe technology for biofuels production
• Owns/Operates renewable fuels and chemicals facilities in US and India
• Acquired Cilion, Inc. 60 MGY ethanol plant in Keyes, CA (2012) (build cost $132M)
• Built 50 MGY advanced biofuel plant in Kakinada, India (2008) (build cost $22M)
• ~$190 million revenue in 2012
• Positive EBITDA in India; On track to US positive EBITDA in 2Q 2013
• 110+ employees worldwide
• Key Customers:
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Agenda

 Introduction  Board / Management Team  Industry Problem & Solution  Company Background  Current / Future Developments

• Eric McAfee, Chairman and CEO, Founder
• Founder of Pacific Ethanol (Nasdaq: PEIX), Evolution Petroleum (Amex: EPM), Pacific Asia

Petroleum (Amex: CAK)

• GlobalScot appointed by First Minister of Scotland to advise on renewable energy
• Harold Sorgenti, Director
• Principal of Sorgenti Investment Partners (chemical investments)
• Former President/CEO of ARCO Chemical Company (12 years including IPO)
• John Block, Director
• Former Secretary of Agriculture from 1981-86 under President Reagan
• Food industry executive for 18 years
• Fran Barton, Director
• Former CFO of several multi-billion-dollar revenues companies: AMD, Atmel, Amdahl, UTStarcom,

Digital Equipment (PC division)

• Dr. Steven Hutcheson, Director
• Founder of Zymetis, Inc.
• 25 years bacterial molecular biology and molecular genetics at University of Maryland
• PhD University of California Berkeley in cellular biology

Board of Directors

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• Eric McAfee, Chairman and CEO
• Andy Foster, President, AE Advanced Fuels
• Six years in biofuels industry with Aemetis
• Extensive high tech/govt background, including White House and Governor staff
• Sanjeev Gupta, Managing Director, Universal Biofuels (India)
• President of $250 million global specialty chemical company
• Nabisco Brands - India
• Todd Waltz, CFO
• Former Ernst & Young, Litton Industries (5 years) and Apple, Inc. (12 years)
• Jarrett Hollis, Senior Vice President, Operations
• Plant manager of large Midwest and California ethanol plants for 15 years
• Plant manager of 55 mgy Cilion plant startup in 2008 as new facility and restart 2011
• Michael Rosa, Senior Vice President, Engineering
• Land-O-Lakes (33 years); large-scale food-processing facility construction
• Plant engineer for construction and retrofit of $130 million Cilion plant

Senior Management Team

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Agenda

 Introduction  Board / Management Team  Industry Problem & Solution  Company Background  Current / Future Developments

Introduction: Biofuels Industry

• Large Market: $40 billion per year in US for 13 billion gallons blended
• Capacity: 210+ plants cost about $28 billion to construct
• Less Expensive Fuel: Ethanol is less expensive than gasoline by more than $0.50

per gallon

• Lowers cost of gasoline by $1.09 per gallon: Replaces 10% of gasoline in US,

lowering cost of crude oil by replacing demand with renewable fuel

• Provides 115 octane
• More power
• Allows using lower quality, lower cost crude oil to make gasoline
• Contains 30% oxygen
• Cleaner burning gasoline – required by federal air quality laws
• Not subsidized:
• Federal blender tax credit ended Dec 2011
• Biofuels do not receive tax-free Master Limited Partnership (MLP) status
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Problem: Gen 1 Biofuels Challenges

• Gen 1 Corn-Based Ethanol Issues:
• Capital Expenditures: Cost $1 for $1 of equipment – no discounted assets
• High Operating Costs: Corn feedstock competes with food supply
• Subsidy driven marketplace: Ended Dec 2011 (repeal of $0.45 tax credit)
• Capacity to meet EPA mandates for first generation ethanol achieved

Source: USDA. Economic Research Service. The Renewable Identification Number System and U.S. Biofuel Mandates. Mandated 1st Gen. Ethanol Capacity

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• Larger Markets:
• Advanced Biofuels = 21 billion gallon EPA mandate by 2022 = $60 billion market
• Fermentation of Bioplastics = $500 billion market
• Lower Capital Costs:
• Acquire or JV with existing Gen 1 facilities at significant discount
• Leverage Gen 1 permits, operating personnel, low asset values
• Lower Operating Costs:
• Non-food feedstocks do not compete with food supply
• Feedstock geographic diversity
• Solar energy directly used in production of biofuels/chemicals
• Lower land use – 400 acres instead of 120,000 acres to supply feedstock for 60 mgy plant
• Higher Margins:
• Gen 2 Feedstocks - Limited alternative markets
• Gen 2 Biofuels - Higher market value and lower carbon content
• Gen 3 Feedstocks - Produced at plant rather than offsite with transport costs
• Gen 3 Biofuels/Bioplastics - Higher market value and lower carbon content

Solution: Convert Gen 1 Plants to Gen 2-3

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• New Products produced at Gen 1 Plants upgraded to Gen 2 and 3 technology
• Fuels
• Advanced ethanol from grain sorghum
• December 2012 EPA ruling that ethanol made from grain sorghum and

biogas using CHP is Advanced Biofuel

• Biodiesel from waste stearine feedstock (a byproduct of edible oils)
• Advanced ethanol from cyano-bacteria (blue algae)
• 100% Replacement Jet and Diesel fuel from algal oils
• Chemicals/Plastics
• Sustainable plastic from fermentation of natural gas or biogas
• Other biocatalyst, fermentation-based products from sugar
• Isoprene from sugar, starch and cellulose feedstocks

Result: New Products at Higher Margins

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Agenda

 Introduction  Board / Management Team  Industry Problem & Solution  Company Background  Current / Future Developments

Improved Profitability

Aemetis Increases Cash Flow of Biofuels Plants

G2

Advanced Biofuel - Milo Advanced Biofuel - Algae Traditional Ethanol - Corn

$0.05 per Gallon

Trends in 2013 to higher fuel prices and 20% lower corn costs = Cash flow of more than $0.20 per gallon by 2014

$0.18 per Gallon

D5 Advanced Biofuels using biogas and CHP = CF of $0.38 per gallon by 2014

$1.65 per Gallon

$3.90 revenues

• $0.50 feedstock
• $0.48 processing

= $2.92 gross margin

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G1

Improved Technology

Aemetis Reduces Carbon Content of Biofuels

G2

Advanced Biofuel - Milo Advanced Biofuel - Algae Traditional Ethanol - Corn

80 Carbon Units 45 Carbon Units <30 Carbon Units

G1

17% reduction in Carbon Intensity vs. Gasoline Gasoline = 96 Carbon Units 52% reduction in GHG emissions 68% reduction in GHG emissions

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50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 4/05/12 4/25/12 5/14/12 6/01/12 6/20/12 7/10/12 7/27/12 8/15/12 9/04/12 9/21/12 10/10/12 10/31/12 11/19/12 12/07/12 12/27/12 1/16/13 2/05/13 2/25/13 3/14/13 4/03/13

Financial Highlights

P&L Capital Structure Share Price Performance

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Issuer Name: Aemetis, Inc. Ticker: AMTX Exchange: OTCQB Share Price (4/5/13): $0.50 Market Cap (4/5/13): $92.2 Million ADV (3 month): 45,954

in $ millions 2009 2010 2011 2012 Total Revenue 9.18 $ 8.13 $ 141.86 $ 189.05 $ Gross Profit 0.13 $ (0.12) $ 4.51 $ (8.93) $ EBITDA (7.29) $ (2.43) $ 0.93 $ 31.95 $ Net income / (loss) (11.34) $ (8.56) $ (18.30) $ (4.30) $

December 31, 2012 September 30, 2012 Current Assets Cash and cash equivalents 290,603 77,667 Accounts receivable 1,360,606 1,887,359 Inventories 4,555,780 4,006,467 Prepaid expenses 264,243 316,789 Other current assets 374,217 738,246 Total current assets 6,845,449 $ 7,026,528 $ Property, plant and equipment, net 83,893,472 $ 85,610,621 $ Goodwill and intangible assets 2,767,994 $ 2,767,994 $ Other assets 3,365,244 $ 3,442,591 $ Total Assets 96,872,159 $ 98,847,734 $ Total Debt 70,045,595 $ 66,032,463 $ Shareholders' Equity Series B convertible preferred stock 3,098 3,097 Common stock 180,281 170,548 Additional paid-in capital 75,457,760 76,309,836 Accumulated (deficit) (69,808,294) (62,970,367) Accumulated other comprehensive income (2,317,893) (2,134,054) Total shareholders' equity 3,514,952 $ 11,379,060 $ Balance Sheet

as of March 28, 2013

Common stock: Institutional/Corporate Holders: Sprott Group 9.5% Telecom Investments 4.0% Third Eye Capital 3.9% Zinfadel (Cilion Acq) 3.1% Yucaipa (Cilion Acq) 2.1% Khosla (Cilion Acq) 2.0% The Industrial Company 1.1% Ethanol Business Group 1.0% Dalrymple Global Resources Master Fund 0.4% Total Institutional Ownership 27.1% Acquisitions / Preferred Stock Conversions 14.6% Financings and Warrant Conversions 6.2% Founders/Management/Board/Advisors Eric McAfee 17.4% Laird Cagan 12.3% Other Board/Management/Advisors 14.5% Total Founders/Mgmt/Board/Advisors 44.2% Series B Preferred Stock (1:1 Conversion) 1.5% Warrants: 1.3% Options: 5.1% Total Fully Diluted 100.0%

Shareholders

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Agenda

 Introduction  Board / Management Team  Industry Problem & Solution  Company Background  Current / Future Developments

• Original Build Cost $132 million in 2008
• Investors: Khosla; Branson; CalPERS; Skoll
• Aemetis acquired 100% in July 2012
• $15 million cash + 11% of Aemetis
• 2012 revenues: $180 million
• Original Build Cost $22 million in 2008
• Built by Aemetis
• Non-food feedstock
• Byproduct of edible palm oil
• Refined glycerin for pharma and industrial

customers

Facility Overview

60 mgy Ethanol Plant - Modesto, CA 50 mgy Biodiesel Plant - Kakinada, India

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• Aemetis repurposes lower-value Gen 1 corn ethanol plants with advanced

technology, feedstocks and new processes to produce Gen 2 and 3 products

• Demonstrate upgrades at Aemetis plants, then partner with existing biofuels facilities to

deploy technology

• Already executed construction and operation of Gen 2 biodiesel plant in India
• Non-food feedstock – Waste stearine from edible palm oil production
• Geographic and feedstock diversity
• Global customer base

Plant Upgrade Strategy

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• Dec 17, 2012: EPA approved conversion of corn ethanol plants to Advanced

Biofuels

• Corn  Milo (grain sorghum)
• Keyes plant advantage: Located 40 miles from deep water Pacific port in Stockton = import less

expensive milo from Argentina, rather than use higher priced Midwest milo

• Natural Gas  Biogas (from landfills)
• Keyes plant advantage: Can acquire biogas supply now due to steam turbine in place
• Grid Electricity  Combined Heat and Power
• Keyes plant advantage: Expensive steam turbine already installed and operating due to the high

cost of California power, unlike other plants in CA and Midwest

• Jan 2013: India government increased diesel price 25% to equal world price for

commercial/govt customers

• Operating margins for sales to India customers = 30% (including refined glycerin byproduct)
• Provides cash flow for plant upgrades to next generation technologies
• Technology for renewable jet fuel and diesel that 100% replaces existing fuel

Recent Favorable Policies

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• Algae Reactor Technology
• Use existing distillation system at Keyes plant ($50 million system cost already invested)
• Ethanol yield 150,000 gallons per acre from the Aemetis SAT Algae Reactor
• Commercial size reactors operating Solar-Fiberoptic-CO2 Reactor technology
• 400 acres of reactor systems expected to produce 60 million gallons of ethanol per year
• Ambient temperature and ambient pressure system = low energy use
• Feedstock: CO2 from advanced biofuels plant; low cost minerals; water; sunlight
• Ethanol Revenues = about $4.00 per gallon (with $1 per gallon cellulosic tax credit)
• Ethanol cost = target $0.98 per gallon opex; $8.00 per gallon capex at scale
• Bioplastic Technology
• Addressable Market = 50 billion pounds of the 520 billion pound plastic market
• Use existing fermentation system at Keyes plant ($70 million system cost already invested)
• Natural gas (or biogas) as feedstock to produce sustainable plastic using biocatalyst
• Ambient temperature and low pressure system
• Initial 2 million pound production unit by installation of new system components
• Expanded 20 million pound production unit by conversion of existing 80,000 gallon ferm tank
• Commercial 200 million pound production unit by conversion of 1 million gallon ferm tank
• Revenues = $1.10 per pound; Cost = $0.60 per pound; Gross Margin 40%+

Technology Deployment Upside

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Appendix A

Peer Group Statistical Comparison

(as of April 5, 2013)

$USD in Millions, except per share data

Company Name Ticker Share Price Market Value (MV) Enterprise Value (EV) Sales EBITDA MV to Sales EV to Sales Solazyme Inc. SZYM $7.34 $453.3 $319.3 $44.1 ($81.6) 10.3x 7.2x KiOR Inc. KIOR $4.02 $425.3 $510.4

• ($92.1)
• Amyris Inc.

AMRS $2.85 $210.6 $287.2 $73.7 ($141.0) 2.9x 3.9x Aemetis, Inc. AMTX $0.50 $92.2 $164.3 $189.00 $32.6 0.5x 0.9x $295.4 $372.3 $58.9 ($104.9) 6.6x 5.6x $425.3 $319.3 $58.9 ($92.1) 6.6x 5.6x Source: FactSet, Capital IQ Peer Mean Peer Median

Appendix B

G1/G2/G3 Product Margin Comparison

(figures projected 2013) Corn Sorghum Algae Unit Economics (per gallon) G1 G2 G3 Ethanol Sales Price $2.85 $2.90 $3.90 Co-Product Sales Price (DDGS or WDG) $0.75 $0.75 $0.00 Other Revenues $0.09 $0.09 $0.00 Total Revenue $3.69 $3.74 $3.90 Cost of Input $3.16 $3.09 $0.50 Cost of Transformation $0.48 $0.48 $1.75 Gross Profit $0.04 $0.17 $1.65 % 1.2% 4.4% 42.3%

Appendix C

Aemetis Facility Acquisition Overview

(as of April 5, 2013) $USD in Millions Facility Asset Overview (International) Keyes Plant (Nameplate Capacity 60 mgy) Keyes Facility Build Cost (2008) $132.0 Aemetis Acquisition Cost (2012) $15.0 (+11% Aemetis Stock) Kakinada Plant (Nameplate Capacity 50 mgy) Kakinada Facility Build Cost (2008) $22.0 Total Original Build Cost $154.0 Total Aemetis Cash Outlay $37.0 Inferred Net Benefit $117.0

Commercially Operating Second Generation Advanced Biofuels Company www.aemetis.com