2012-03-16 - novadx presentation (new)
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C O R P O R A T E P R E S E N T A T I O NMarch 2012
V E N T U R E S CO R P.
TSX.V: NDX
US SYMBOL: NDXFF
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V E N T U R E S CO R P.
TS X - V : N D XFORWARD LOOKING STATEMENTS
This presentations contains "forward-looking information" that includes information relating to future events and future financial and operating performance,
including management's assessment of Novadxs and MCoals future outlook, potential financings, potential acquisitions and production. Specifically, this release
contains forward-looking information related MCoal's operations, permits, properties and future development of assets, reserves or production. Statements
included in this announcement, including statements concerning our plans, intentions and expectations, which are not historical in nature are intended to be, and
are hereby identified as, "forward-looking statements" for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as
amended by the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including "anticipates", "believes",
"intends", "estimates", "expects" and similar expressions. Forward-looking information should not be read as a guarantee of future performance or results and will
not necessarily be accurate indications of the times at, or by which, that performance or those results will be achieved. Forward-looking information is based on
information available at the time it is made and/or management's good faith belief as of that time with respect to future events, and such information is subject to
risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking
information. Important factors that could cause these differences include but are not limited to: pricing and assumptions and projections concerning reserves and/or resources in our mining operations; changes in contracted sales, changes in production or operations the business of the Company may suffer as a result of
uncertainty surrounding the coal market; the Company may be adversely affected by other economic, business, and/or competitive factors; the worldwide
demand for coal; the price of coal; the price of alternative fuel sources; the supply of coal and other competitive factors; the costs to mine and transport coal; the
ability to obtain new mining permits; the costs of reclamation of previously mined properties; the risks of expanding coal production; the ability to bring new mines
on line on schedule; industry competition; the Company's ability to continue to execute its growth strategies; the Company's ability to secure additional financing;
the Company's ability to complete planned acquisitions; and general economic conditions. You should not put undue reliance on any forward-looking information.
We assume no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward
looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking information, no inference should be
drawn that we will make additional updates with respect to those or other forward-looking information.
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The Company cautions readers that forward-looking statements, including without limitation those relating to the
Company's future operations and business prospects, are subject to certain risks and uncertainties that could cause
actual results to differ materially from those indicated in the forward-looking statements.
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V E N T U R E S CO R P.
TS X - V : N D XOVERVIEW
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High quality, high margin metallurgical coal producer in the US.
Rosa Mine (AL)Producing ~10,000 tons per month fully contracted at $170-180 per ton (50% margin).
Rex Mine (TN)Initial 20,000 tons per month slated ~4 months from receiving wash plant permits.
Projected combined production of 400k tons in 2013 from the existing 2 mines. (~$20M EBITDA). Financed by 25% coal stream sold to Sandstorm Metals & Energy (TSXV: SND) for a US $30 million
upfront production payment.
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V E N T U R E S CO R P.
TS X - V : N D XMANAGEMENT
Neil MacDonald (BASc.)CEO & Director
18 years of experience in investment banking and involvement
in numerous financings. Prior to forming Novadx he held senior
positions with Raymond James Canada and Blackmont Capital
Corp and has served on several public company boards and is
a member of the TSX Venture Exchange local advisory
committee.
Robert Payne (BSc.)Chief Operating Officer
Senior coal mining professional with over 25 years of coal
mining, management and engineering experience in both
underground and surface coal mine development, operations,
production, safety and compliance.
Valerie Helsing (CPA, CMA, BA)
Chief Financial Officer
20 years of public practice experience and broad experience in
both Canadian and US accounting, audit, finance and regulatory
matters. She has served in senior financial positions with
several public companies in the mining and mineral exploration
industries.
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Gregory Saragas
Vice President, Finance
Previously held senior management positions with companies such as
Massey Energy, Debra Lynn Coals, and Nystar. While at Debra Lynn
Coals, Mr. Saragas managed day to day operations as Production
Manager, later advancing to CFO, where he was instrumental in
improving productivity and profitability. After leaving Debra Lynn Coals,
Mr. Saragas accepted a position of Regional CFO with Massey Energy.
Mark MillsMine Manager, Rex No. 1 Mine
30 years of mining experience in the central Appalachian coal fields.
With a background in underground, highwall and surface mining his
responsibilities have evolved from surveying, permitting, planning, mine
management, general manager, to senior management giving him a
wide range of experience in mine production, safety and compliance.
Randy YoungbloodMine Manager, Rosa Mine
35 years of experience in coal mining in Alabama. Randy has held
mine supervisory, coal sales and transportation management positions
with several coal companies including King Coal, Cullman Coal and
Reid Mining.
100+ Years Experience in Coal Operations
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V E N T U R E S CO R P.
TS X - V : N D XCORPORATE OVERVIEW
SHARE STRUCTURE
As at December 31, 2011
Issued & Outstanding 79,124,913
Warrants (average $0.24) 4,344,710
Options (average $0.34) 5,166,250
Convertible Debenture1 8,900,000
Fully Diluted 97,535,873
Management Ownership !13%
TSX-V Listing NDX
Market Cap. (March 16, 2012) $17M
1 Convertible at $0.30. 10% per annum. Expires 2014
1 YEAR CHART
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V E N T U R E S CO R P.
TS X - V : N D XOUR LOCATIONS
The Appalachian Basin is one of Americas leading Metallurgical Coal Regions
Source: US Geological Survey
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Rex Mine
Rosa Mine
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V E N T U R E S CO R P.
TS X - V : N D XROSA MINE:ALABAMA
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Currently producing and selling ~120,000 tons per year
Total resources support an estimated 10 year mine life
Coal in demand by coking coal & activated carbon markets
Rosa receives premium pricing at ~$175 per ton (50% margin)
Coal is auger mined and processed by wash plant located at mine.
Proven and probable 652,000 ton NI 43-101 compliant reserve being mined in Phase 1 of mineplan.1
Mine plan developed to increase production to 300,000 tons per year
1 Source: Sections 3.7 and 3.9 of the Technical Report on Phase 1 of Rosa Mine Coal Property byMcGehee Engineering Corporation, March 18, 2010
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V E N T U R E S CO R P.
TS X - V : N D XREX MINE: TENNESSEE
Fully permitted metallurgical coal mine stockpiling and selling raw coal Ramping to ~20,000 tons/month within 4 months of pending wash plant permits Total resources support an estimated 20+ year mine life Pending wash plant permits in final stages with the government Coal quality in demand by silicon metal markets and commands up to $190/ton NI43-101 proven and probable recoverable coal reserves of 11.3 million tons2 with an in-situ
measured and indicated coal resource of 38.1 million tons.
Ability to increase production to 720,000 tons per year
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2 Source: Independent data verification and evaluation of Rex Coal seam at Rex Mine No. 1conducted under the supervision of Mr. John Feddock, P.E. , Senior Vice President of Marshal
Miller & Associates Inc. January 31, 2012
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V E N T U R E S CO R P.
TS X - V : N D XCOAL MARKET
Novadx focuses its operations on high-grade hard coking coal forthe metallurgical and specialty markets.
Strong domestic growth forecasted in activated carbon andsilicon metals market through 2020.
Market includes silicon metal, aluminum, solar energy, special steelsand semi-conductors.
Metallurgical and specialty markets command much higherprices and produce better margins than thermal coal.
70% of all global steel production is reliant on metallurgical coalas a key component of the manufacturing process.
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V E N T U R E S CO R P.
TS X - V : N D XPRODUCTION & EBITDA PROFILE
Production(Thousand Tons) EBITDA
*
(Millions $)
* Net of Sandstorm Payments
10
0
200
400
600
800
1000
1200
2012 2013 2014 2015 2016
Rosa Mine Rex Upside Case
$0
$10
$20
$30
$40
$50
$60
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V E N T U R E S CO R P.
TS X - V : N D XMARKET COMPARABLES
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0
0.5
1
1.5
2
2.5
Cline Mining
Corp.
Xinergy Ltd. Corsa Coal
Corp.
Novadx
Ventures Inc.
EV/2013e EBITDA
2.0x
1.6x
1.9x
1.0x
$0.96
$0.84
$0.99
$0.34
$-
$0.20
$0.40
$0.60
$0.80
$1.00
$1.20
Cline Mining
Corp.
Xinergy Ltd. Corsa Coal Ltd. Novadx
Ventures Inc.
MC/Total Resources ($/ton)
Source: Jennings Coal Notes, March 5, 2012 Source: Jennings Coal Notes, March 5, 2012
Industry Average
1.8xIndustry Average
$0.93
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V E N T U R E S CO R P.
TS X - V : N D XSUMMARY
High quality, high margin domestic metallurgical coal producer
Management team with 100+ years of coal operational experience
Trading at 1.0x EV/2013e EBITDA, half of industry average
Potential to increase production to 1Mtpa from both assets
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V E N T U R E S CO R P.
TS X - V : N D X
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HEAD OFFICE
450 650 W. Georgia Street
PO Box 11599
Vancouver, BC V6B 4N8
Tel: 604.633.2776
Fax: 604.683.6564
www.novadx.com
INVESTOR RELATIONS
Kin Communications inc.
210 736 Granville Street
Vancouver, BC V6Z 1G3
Tel: 604.684.6730
Fax: 1.866.684.6730
www. kincommunications.com
V E N T U R E S CO R P.
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V E N T U R E S CO R P.
TS X - V : N D X
APPENDIX
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V E N T U R E S CO R P.
TS X - V : N D XOUR PRODUCT
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Novadx focuses its operations on on high-grade hard coal for the metallurgical andspecialty markets
Low Rank Coals
47%
Lignite
17%
Sub-Bituminous
47%
Hard Coal
53%
Bituminous
52%
Thermal Steam Coal
Anthracite
!1%
Moisture Content of Coal
Carbon Energy Content of Coal
Source: World Coal Institute
%ofWorldReserves
Largely powergeneration
Power generation, cement manufacture,& industrial uses
Manufacture ofiron & steel
Silicon MetalActivated
Carbon
Domestic / industrialincluding smokeless fuels
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V E N T U R E S CO R P.
TS X - V : N D XOUR MARKETS:METALLURGICAL COAL & STEEL
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Metallurgical Coal is vital for steel manufacturing
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70% of all global steel production is reliant on metallurgical coal as a key
component of the manufacturing process.
World crude steel production was 1.4 billion tonnes in 2010, which required
721 million tonnes of coking coal.
Coal demand is expected to increase through 2020.
Source: World Coal Institute
Did You Know?
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V E N T U R E S CO R P.
TS X - V : N D XOUR MARKETS: METALLURGICAL COAL & STEEL
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Global Production Of Steel And Coking Coal
Metallurgical coal vital for
steel manufacturing
2010 saw global production records forsteel and demand for coking coal
Largest coal users are China and Japan
Australia and USA are the largest cokingcoal exporting nations followed by Canada
0
200
400
600
800
10001200
1400
1600
1995 1997 1999 2001 2003 2005 2007 2009
Steel Coal
Source: World Coal Institute, Aperam
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V E N T U R E S CO R P.
TS X - V : N D XOUR MARKETS:ACTIVATED CARBON/COAL MARKET
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USES ACTIVATED CARBON MARKET
US is largest consumer of activatedcarbon products.
Market growth lead by USforecasted 13% per annum due to
more restrictive environmental
legislations.
Activated carbon (activated charcoal) has the strongest physical adsorptionforces or the highest volume of adsorbing porosity of any material known tomankind.
Water Treatment
Medical &
Pharmaceuticals
Food & Beverages
Air Purification