Advanced Engineered Materials (AEM) Investor presentation summary

Market opportunity and industry trends

• High purity alumina (HPA) demand is growing rapidly, driven by advanced ceramics, semiconductors, batteries, and synthetic sapphire markets, with a forecast CAGR of ~10% from 2025 to 2034.

• Global supply is dominated by China, but ex-China supply is limited and closely matches actual capacity, creating a supply deficit from 2029.

• HPA pricing is expected to rise due to tight market conditions and undersupply, with long-term prices forecast to reach $30–46/kg for 4N/4N+ products.

• Customers are increasingly sensitive to quality and supply security, leading to lengthy qualification processes and sticky supplier relationships.

Operations and expansion strategy

• The Cap-Chat plant in Quebec currently operates at 2,000 tpa HPA capacity, with expansion to 3,000 tpa by mid-2026 and plans for 6,000 tpa by 2029.

• The plant benefits from low-cost renewable hydroelectricity (<US5c/kWh), a stable political environment, and proximity to feedstock suppliers.

• Stage 2 expansion, adjacent to the current plant, is expected to double capacity with robust economics: capex of $215m and steady-state EBITDA of $47–85m at margins of 74–84%.

• Government support includes project finance, capex rebates, and R&D tax credits.

Technology and competitive positioning

• Innovative, patented production processes enable both high and ultra-high purity HPA, with industry-leading low carbon emissions (77% lower than incumbents).

• The Montreal Technology Development Centre drives process innovation, margin expansion, and customer collaboration.

• AEM is forecast to be in the bottom half of the global HPA cost curve, delivering ROW quality at costs competitive with China.