AML3D Investor Briefing - April 2022
Giles Rafferty, First Advisors: Welcome to this First Advisors investor webinar with me Giles Rafferty. Today's webinar features AML3D, which has the ASX code AL3. AML3D uses its advanced technology solutions to create industrial scale metal components that are stronger and more resistant than the equivalent traditionally manufactured components. AML3D has created a production process that dramatically reduces waste and lead times while also improving ESG outcomes. The combination of AML3D is proprietary ARCEMY wire additive manufacturing units. And WAMsoft software make AML3D
an industry leader in industrial scale 3D metal printing, and a technology disrupter of the metal fabrication industry. Today's webinar is expected to run for about an hour or so and be split into two roughly equal sections. The first section will consist of a presentation by AML3D Managing Director, Andy Sales, that will profile the company, walk investors through AML3D strategy and investment thesis. And this presentation will be followed by a Q&A session when Hamish McEwin AML3D CFO will also be available to answer questions. Should you wish to ask a question you can do so by typing a question in the Q&A box on your screen. We will endeavor to ask as many of your questions as we can during the course of the webinar.
I would now like to introduce you to Andy Sales, Managing Director of AML3D. Andy Sales: Thankyou Giles, Welcome, everyone, to today's webinar. Today's presentation is very much part of AML3D as a company and myself as its Managing Director, making sure that the market is well informed and up to date on the company's value proposition. Currently AML3D has a market capitalization of a little over 12 million and share price of eight and a half cents given we've already bought to the end of FY 22 revenues in hand. And we have a proven technology that is fundamentally disrupting and improving on traditional industrial scale metal component manufacturing. We strongly feel that AML3D is significantly undervalued.
Only last week, RAAS released a research report valuing AML3D's shares at 43 cents which represents around a $65 million market cap to help address this valuation gap the board and management of AML3D are undertaking an active campaign to raise awareness of the company and its investment proposition with new investors, brokers and analysts with a view to attracting new investors into the company. And materially improving its share price over time. My expectation is that once I've had a chance to run through today's presentation with you, you will see the significant progress we're currently making on executing our strategy and also have a good sense of the AML3D broad business investment thesis and opportunities. To the disclaimer slide it's important to include the same slide but I won't dwell on this for now.
Should you wish to read it in detail it is included in the presentation deck which you can download from the AML3D website. The investment thesis I've mentioned AML3D has a proven technology that disrupts traditional industrial, bulk metal component manufacturing. Our proprietary and patented Wire Additive Manufacturing Technology has allowed us to develop 3D printing solutions that create industrial scale, metal components, in less time with less waste. But importantly, matches and often exceeds the strength and resilience of traditionally manufactured components. AML3D's faster, stronger, and greener technology is already being used for prototyping industrial components, in the oil and gas sector, the Marine sector defense and aerospace and the space sector just recently.
We have relatively few direct competitors and by building on the existing contracts and relationships we have with global tier one customers, notably in the oil and gas sector, we have multiple pathways to significantly increase global revenues over the midterm. Critically unlike other players in the sector, our processes are quality certified, which means that our customers can buy our products. Put them directly into industrial use, and for us this means more revenue. And earlier.
As I've mentioned for FY 22 We've already have over 2 million of revenue for contracts, which represents a three and a half multiple compared to this time last year. So far in 22 is part of the Phase One AML3D's multiple phase strategic growth plan that involves continuing to build on our current successes, winning business in the oil and gas sectors. And expanding over mid turn into marine defense, aerospace and the space market. And then leveraging our R&D
works to create new commercial opportunities, enhanced technology enabled solutions and branded products in the longer term across all three phases on our growth strategy. We will be targeting multiple revenue streams including contract manufacturing services, design services for additive manufacturing. Sales of ARCEMY industrial 3D metal printers, sales of wire alloys, and high value wire feedstock maintenance and operational support fees and software licensing fees. This combination of disruptive technology that can access multiple revenue streams across multiple markets within a structured growth strategy is at the heart of AML3D's investment thesis. It is why we're confident that AML3D
We will deliver significant value through time and see significant rewriting of the company's share price. With the agenda, I thought it would be helpful to give you an overview of the areas I'm planning to cover during this presentation. But before we get into that, I thought it would also be useful to give you a sense of the scale of the components and proprietary technology solutions can deliver. And it's worth bearing in mind that AML3D's Technology
has been designed to allow us to meet each customer's specific needs. From a design, prototyping and contract manufacturing at scale. That we're delivering to supporting enterprise level manufacturing contracts that incorporate the entire AML3D technology suite.
I mentioned our technology improves the strength and structural integrity of our industrial components. Wire Additive of manufacturing minimizes and can remove the need for welded and bolted joints. Which means our printed components help minimize the requirement for maintenance or replacement. Limit downtime and breakdowns, creating greater efficiency and adding immense value to our customers processes. The metal end products produced by a proprietary label technology has also been proven to be marginally stronger than cast, billeted and forged metal blocks traditionally used for industrial products and components.
Another way, our technology is disrupting traditional manufacturing is it allows for just in time industrial component manufacturing. And that means that our customers can avoid expensive and time consuming tooling and also avoid lengthy delivery times. Our 3D metal printing solutions significantly reduce these cycle times and deliver better quality components compared to the traditional bulk metal manufacturing.
Our multi-phase growth strategy means we can actively address multiple sophisticated and geographically diverse markets for complex industrial components. IMS proprietary technology solutions are proven currently delivering to customers and certified by industry bodies such as Lloyd's Register, and DNV. We are the market leader in the large scale 3D printing sector, which is a market set to grow in excess of 20% per year for the next three years. We're also positioned within the advanced metal wire additive manufacturing sector which has also forecast to grow at over 20% per year over the next three years and sits within the global additive manufacturing market, which is also expected to grow overall by 30% per year, up to 2028. AML3D will focus on opportunities targeting the oil and gas, marine, defense aerospace and space sectors. In
the US and the Asia Pacific region, including Singapore and Australia, where our technology is shown to provide superior outcomes to existing alternatives. I will go through a few specific near term opportunities later in this presentation. Multiple revenue streams we own and are continuing to develop our market leading technology this creates the opportunity to access multiple revenue streams. For some customers who simply need component manufacturing at scale, we provide contract manufacturing on a fee for service basis. To customers that need an ongoing local manufacturing capability. We can sell and install an ARCEMY printer where it's needed.
Further revenue streams are generated by the annual licensing of our WAMSoft software, including service fees that cover training and software updates. A number of our customers are also looking for us to provide enterprise level solutions where we supply the full support ARCEMY units to global tier one customers, including design services, training, software, and servicing and potentially embedding AML3D personnel within a customer's operations were needed. We're excited to progress a number of these enterprise opportunities in the near term as they will suit our target customers businesses and would provide us with large reoccurring and growing revenue streams. We're also developing additional longer term revenue streams through our R&D work, which is expected to create opportunities for sales of branded wire alloys and high value wire feedstock.
The cycle for securing contracts with Tier One customers can take anywhere between three months to 18 months from initiation to a signed contract, and that can depend on several variables including the level of complexity of the components and the testing standards and the testing regime. That needs to be met for the customer's particular application. However, the five key milestones shown here on this slide are common to all contract negotiations and allow us to track progress and have a degree of visibility on the timing of contracts and the levels of support AML3D need to provide customers and the resourcing we need to put that into place.
We're hopeful of making a number of announcements later this year regarding opportunities that we've been working on through this process. AML3D's multi-phase growth strategy allows us to prioritize immediate revenue opportunities in our primary markets, the energy and oil and gas sector while also exploring opportunities within the marine defense, aerospace and space markets and investing in the R&D programs that will underpin long term revenue growth. AML's sweet spot is using our proven technology to provide flexible, timely and cost effective design and delivery of complex medium to large scale metal components. We are equally at home delivering for original equipment manufacturers or end users looking for replaceable components that exceed the capabilities of traditional manufacturing processes. We believe it's important to develop our existing relationships and understanding of the energy in oil and gas sectors so we can apply what we learn there and leverage off a track record of delivering to a high standard for global customers.
I'm quite proud of AML3D's success in developing our market leading technology, 3D metal printing technology and we'd like to give you an overview of our technology advantage over the next two slides. The technology has many advantages over traditional industrial cast, forged and billet material manufacturing process for medium to large scale industrial components. Our 3D metal printing solutions can be up to 30% Stronger. Cut lead times by up to 75%.
Be up to 70% more efficient and 50% more resistant to metal fatigue over time. But what really sets AML3D apart not only from traditional manufacturing, but also our Additive Manufacturing Technology peer group is that our manufacturing process is certified through Lloyd's Register, comes with ISO 9001 quality management systems. American Welding Society compliance and BizSafe compliance. We're also soon to be accredited to DNV, another prestigious classification society. These industry certifications and accreditations are critical to being able to market and sell to our targeted industrial customers. And many of our technology peers are yet to achieve these milestones.
Our technology is also differentiated by the level to which it can support our customers to meet their internal ESG targets. In addition to traditional financial metrics ESG consideration is increasingly influencing the purchasing decisions of our global tier one customers compared to traditional metal manufacturing process AML3D's technology can offer significantly improved environmental and sustainability outcomes. Our largest ARCEMY unit occupies around 90% less space than Australia's largest traditional metal casting forging operations. Our successful prototyping of Panama Chock for Keppel Industries recently in Singapore created more than 80% less waste. Additive Manufacturing within the aerospace industry was found to result upto 87% reduction in emissions also. I've made frequent references to our multi-phase growth strategy. So I
would like to talk through how that works over the next couple of slides. In essence, we're targeting shareholder value creation across a number of horizons. Our immediate drivers of revenue growth are using our established relationships and proven technology to support contract manufacturing negotiations with global tier one customers in the oil and gas sector.
We have a number of these well progressed opportunities, which we are hopeful of announcing in the near term. Over the medium term, we are looking for revenue growth through securing global tier one customers in our secondary markets of marine defense, aerospace and space sectors. And we're delighted with the quality of active engagement we're having with current global leading aerospace companies right now. Also, within our medium term growth plan is developing enterprise level solutions with Tier One customers across all six with an enterprise level solution would involve supplying a customer with a full AML3D suite of technology including the supply, support and servicing of 3D metal printing, alongside full service training, design services, software licensing, and potentially embedding our people within our customers operations.
For longer term opportunities, we continue to enhance our software and technology through in house development and partnerships with leading research institutions such as Deakin University, RMIT, Adelaide and Flinders Universities. We are developing advanced new materials and are looking to monetize the IP that we've created through the creation and sale of branded wire feedstock and high value wire feedstocks. Alongside provision of advanced materials for 3D printing, industrial components. I've also mentioned we have over $2 million of FY 22 revenues from contracts currently in hand. This slide shows the range of customers that were supplying today and who form our immediate value drivers.
You can see the mix of revenues from contract manufacturing, to prototyping to ARCEMY unit sales, and also that we mean what we mean by global tier one customers such as Schlumberger. It's important to note here the sales we are currently generating from contract manufacturing include multiple prototype items, which are the precursor for larger contracts for parts manufacture on an ongoing basis. And medium term value drives include ongoing work from our immediate value driver customers such as ThyssenKrupp alongside specialists one off projects, trials and prototype projects across our additional priority markets of defense, aerospace, space and marine. Our R&D work both in house and with our partners underpins the longer term value drivers of the business. They include ongoing work with BAE Systems and Flinders University to develop the next generation of WAM technology and R&D with Deakin University and the IFM to include new wire feedstock opportunities, with a potential to create new AML3D products and processes.
We're also breaking new ground with our work to integrate boron nitride nanotubes, BNNT. One of the world's strongest materials into aluminium with the potential to create new lightweight, high strength alloy with new applications, particularly in the space and aerospace exploration. We're continuing to work to develop our next generation hybrid 3D metal printing unit with also the potential to increase output by up to five times and delivering the way in process that includes final machining to deliver higher quality one stop shop components. We're also supporting third party R&D initiatives at the RMIT and Queensland Universities for the sale of ARCEMY units and associated ongoing support designed and training services. I have one final slide I'd like to talk to, which is the summary. AML3D is focused on delivering shareholder value. We
have created a faster, stronger and greener technology enabled production process for medium to large industrial metal components that disrupts traditional manufacturing. We've developed multi-phase growth plan that we believe will deliver increasing value over the immediate, medium and longer term horizons. Our technology is world leading, in demand and we have relatively few direct competitors. Importantly,
technology is industry certified and accredited. Something many of our additive manufacturing peers are yet to achieve. And we have a clear pathway to increase revenues and profitability. As I've mentioned, we already have $2 million worth of contracts in hand for FY 22 which is close to a three and a half fold increase on FY 21. And we believe in the
momentum in the businesses is building. I hope this presentation has given you a good understanding of the AML3D Investment Case and business model and I thank you for giving me your time today. We're confident our technology and growth strategy will deliver significant value through time. And we're committed to making sure we keep
our investors updated on the progress we're making. There are two additional slides in the appendix that reveal the strength and experience of our board and senior leaders and also gives you a sense of how AML3D's culter is align to giving sustainable returns. I think at this stage, it's a good time for me to open up the webinar for your questions. Giles Rafferty: Thank you for taking us through the presentation, Andy. As you
said, it's probably time to get into the Q&A. Hamish is with us Hamish McEwin is AML3D's CFO, also available to answer your questions. Should you have any? If you do, we do have several questions already submitted. If you wish to ask a question,
please just type it into the Q&A box. But if I may, I'll work through as many as we can in the time that we have the first question I have here is from an attendee called John R our that's John letter R. So that really details I have for him. And it was on one of your slides that we didn't particularly speak to it and it was what is the status of the patent applications in the EU and the USA? Andy Sales: Thank you, John. Good question. Actually I'm quite excited
at the moment because we have a status of these patents that we have received our first challenges earlier in the year. It was January, in both the EU and the USA. What that represents is the final stage of the patent being granted in the US and the EU. Obviously there's a mountain of
applications for all sorts of patents. So we are in the last stages. And we have been told by our patent attorney that we should expect granting of those patents in those regions by the end of the year. And we haven't received any correspondence in the last of couple of months. So it's all good news at the moment. We've responded to the challenges posed and we're quite confident and obviously the patent has already been granted in other areas such as Australia, New Zealand, Singapore and South Korea at the moment with a couple of other areas around the globe to come through as well and we expect those to be by the end of year also.
So by end of year, we should expect a global patent. Quite excited by that prospect at the moment. Giles Rafferty: Another question that we have here, Andy comes from an anonymous attendee. So we don't have the name of the particular investor but then they say there's a clear and it is clear from the deck that the presentation just given that AML3D Technology is addressing industrial applications is it's of industrial scale. The question
is can you ever see a domestic version of your technology? Andy Sales: Well, I guess we have domestic opportunity. So even local here in Adelaide, but generally what we're seeing is a global uptake. There is quite a national interest with the technology. Of course, Australia being you know, traditionally a manufacturing country.
There's plenty of opportunity out there and it's mainly part of our strategy over the over the coming months at least to ramp up that opportunity to offer to new customers on a wider, on a broader scale, what that process can offer. Of course, we are also seeing global supply chains strained at the moment we have actually started receiving quite a number of opportunities from customers that normally traditionally order bulk material parts from China, Asia, Eastern Europe, where those supply chains now quite strained to the point of timeframes of more than 12 months for some of these parts. So we're starting to see growth and inquiry of alternative processes, which is good news for us. Giles Rafferty: Another question I have here, again from an anonymous attendee is quite specifically saying is there any geometry that AML3D cannot make? Andy Sales: Interesting question.
Probably a hard one to answer I guess the way I would probably answer that. Is that we're large scale 3D printing. We have a large scale capability in our process. So we can well we can, on a medium to large scale, come up with geometries that are complex. It's complex on a large scale. What we don't do is the small scale components. So there's
not many geometry geometrical configurations on a large scale that we can't do, because our system actually has an eight axis capability, which means that we can rotate parts on a rotator, we've got a six axis robot which can also angle the delivery head to whatever angle you need. So we have got quite a lot of flexibility on geometrical shapes and features. Giles Rafferty: Another question live today for another anonymous attendee? This one's quite again, someone specific. They're asking, Why is AML3D's technology different from powder based additive manufacturing, and they're specifically looking at companies such as SpaceX because you've got ambitions in that sector and those guys at SpaceX from the power base side of the industry so what doesn't believe in 3D That might mean someone like SpaceX say you're the technology we should be looking at? Andy Sales: An interesting question, and I'm glad somebody's posed that because there is quite a significant difference between the various feedstocks so you know, you genuinely have powder and you have wire. We use wire it's a well established supply chain. It's been around for 100 years. So it's well established, well understood and well standardized and certified. It's
based on welding wire, which has plenty of there is plenty of opportunities, plenty of material grades, and material types are all metal metal types. With powder. Powder, is an interesting feedstock because it's very, it's very restrictive in the sense that there's not the level of material grades out there for end users choice. So there might I think the last count was there was only 12 to 14 metal types available in the wire space, which we deal with. There's this multitude there's 100 Plus wire grades available, which gives us quite a lot of flexibility.
The powder process is also generally governed by the sphere size of the powder as to what their layering heights may be. So therefore, their build process or their build rate is a lot slower. So if you can imagine a sphere, the size of 20 micron let's say, to build 20 to 40 microns, so to build a one millimeter layer takes anywhere between 30 to 50 layer deposits, so it's very slow.
With wire we use 1.2 millimeter wire diameter and 1.6 millimeter wire diameter so our bead size deposited in comparison to powder are order of magnitude more. We could posit a bead size height of about two and a half to three millimeters. So 50 layers for us, we're already at half a metre high, and our deposition rates anywhere from five to ten kilograms per hour, as opposed to powder processes which are significantly less than about 15th less. So 15 times less. So you normally talking
around half a kilogram and you're talking in grams an hour. And so what both feedstocks offer are completely different markets, a powder process would be looking at smaller and refined, specialized one off type components. Whereas we're focused with wire on the medium to large scale which powder would never be able to do on a larger scale. Hopefully that answers that question. Giles Rafferty: There's a lot of questions coming through. So in this
instance, I'm going to bundle two together which seemed very similar and the way they were submitted one was submitted from Steven Rogers and the other from Haskell RU. You both of them suggesting that maybe Steven, yes has been great progress. But maybe the market hasn't been as adequately informed as it could have been over the past 12 months, Haskell reflects the same thought. And they're both saying is there an intention to improve communication with investors, which you know, may well support a better valuation for the company. And what's the plans around that? Look, it's a really good question that we are aware that we do get questioned on communication now and again, but I guess first of all, and maybe Hamish can add to this after but first of all, what we're really focused on is what, what in terms of disclosing information via the ASX portal we're really focused on really tangible opportunities we're not interested in signing an MOU or a letter of intent and exciting investors or potential investors through that. So we are very
focused on revenue generating style contracts and disclosures to market. In saying that we do have quite an active LinkedIn and Facebook profile, probably more LinkedIn. So we are updating weekly some of our activities whether it be in the workshop or whether we're visiting customers or having visitors to the to the facility. Also trade shows as well. We've actually got one coming up in May up in Sydney. So we will endeavor to improve their communication but going back to market disclosures were fully focused on just tangible growth, opportunity style, announcements and revenue generating announcements. Hamish McEwin: I'd like to add, Andy but I think you're pretty much covered it.
Giles Rafferty: Well, then the next question that's come through is another anonymous question. And it may you may well get a response from from both of you if as if that's appropriate. But the question comes down to why you think the enterprise value or the value attributed to the company is low and what might be underpinning that? That's a tricky question I'm sure to answer but do you have a sense of why that is? Andy Sales: I guess, a lot of customers we talk to don't just want a printed components. A lot of them actually want a complete solution. So we've come up with the enterprise, the enterprise
solution that offers a suite of of services from us and that predominantly includes which might be different from what we've done. The past includes design for additive manufacturing, it's helping the customer realize where the opportunities are not in not only one component that may be in it in their suite of components that they normally ordered. Traditionally so Hamish, something to add there as well.
Hamish McEwin: In reference to the market and and where I suppose where that question was going, which was where our share price is at. Currently, the market for additive manufacturing stocks is is not attractive. And we've unfortunately been bogged down with it. I think we've got a really solid, dare I say it, better platform, which is far more mature to grow a business off. As I said, with, with the rest of the market, am stocks. We've
unfortunately been targeted with it. Giles Rafferty: I'm thinking maybe with some of the financial metrics that were in the presentation, you mentioned that you've 2 million of revenue from contracts in hand for financial year 2022. An anonymous attendee is just trying to get a sense or a flavor of what what what makes up that 2 million I mean, clearly commercial confidence. You can't necessarily name names, but can you give any sense of what is behind that 2 million figure? Hamish McEwin: So that 75% of it is is from our ARCEMY sales. The
remainder is print jobs. And as we're seeing now with the units we've already got out in the marketplace, the service fees coming through for supporting customers such as Rowland's being the first adopter here in Australia of the unit. Giles Rafferty: Again, I think we're in a groove here with some of the questions are around contracts, revenues, etc. Another anonymous question that has landed is Can you give any sort of forward looking sense of contract announcements or further revenue during FY 2022? I think it's another anonymous attendee. And I think that the favor of this question is the thing they're looking for positive news, I suppose. But then the question really boils
down to is any sort of timeline for contract announcements going forward? Andy Sales: Oh look, I think I covered that in the presentation, there is some near term things happening. And, you know, we're fully aware of the recent few months, but I guess as I've described in one of the slides about customer conversion, there's been a lot of discussions, a lot of planning a lot of engineering going on with certain customers, in particular, some tier ones. So I guess as I've said that there is some there is quite a bit happening and there is some disclosures coming.So, I guess we want to make sure that you know the investors feel that yes, we are busy here.
And I guess that comes back to communication. So yes, here and now we are very busy. There will be things coming up which we'll announce but they'll be good and tangible disclosures as well. So it should keep everyone happy. I'm certainly happy at the moment. Hamish McEwin: And as you already spoke to Andy, you know, the revenue growth this year versus last, and the year before that, where we are a start up and we are finally getting traction. And we
would like to think that we're going to sustain that current level of growth if not exceed it over the next few years. But as you indicated, we're not keen to put pie in the sky estimates out there at this stage. Giles Rafferty: It's always a tricky one, because you know, until things are disclosed or not disclosed, but that is it. There's a bunch of questions here, or relating to the ARCEMY unit, so I thought I might bundle them in some respects and maybe I'll follow on to sort of address the month from First I've got is from an unknown, again, an anonymous attendee. And it
speaks to the idea there was a sale to an ADL fabricator announced last year, and they're trying to understand what are they using that unit to produce? And what sort of products have they been using it to create I don't know if you can speak to that. Clearly. If you sold it to a third party, you may not have direct visibility on what they're using it for. But any sense of what's happening with that would be would be helpful.
Andy Sales: I guess we probably can't disclose another companies, contracts but or what we can say is that that unit, and I think it may be referring to Rowlands, the Rowlands group. They're involved in defense. They're also involved in local agricultural and local general engineering service and supply. A great company in South Australia here with a quite a wide, wide range of offerings, but they've recently obviously taken on one of our units have been actively promoting 3D printing. What I can say is that they are using it across quite a wide, flexible range. So they are
actually testing that unit to the limit. So there's a lot more coming for them, but obviously we can't say what contracts there are. Hamish McEwin: we have engaged with them recently to enhance the capabilities of their unit. So we're working with them over the next six months to work to increase the capability of it to produce more. Giles Rafferty: Another ARCEMY messaging concern attendee who's under the initials TK, and they're talking, they say you mentioned the near future our ARCEMY unit sales from May through June. And the different understand where they're being sold into is it into the Australian market international market is more than one customer is single customer.
Just getting a flavor of what you're looking for in ARCEMY sales. Andy Sales: More than one customer and it's within Australia and globally. So there's a mixture of both, local and overseas countries at the moment. Giles Rafferty: And also looking at ARCEMY, its Stuart Spouse, has asked the question, what are your expectations for the ARCEMY units that have been provided to the universities so far, and you spoke in that presentation about RMIT, University of Queensland but what are the expectations you have for what will come from those machines? Andy Sales: Well, I guess from from experience over the years, what you do normally see in general is that once universities are taking up a certain technology, not only for just simply say, literature and research work, they also most universities also partner with with industry.
So the exciting thing about that is that these learning organizations and research organizations, such as say CSIRO, ANSTO and and the universities. Once there is an uptake it means that there's a growing level of interest in industry, and we're certainly seeing that. So we're quite happy that you know, we've got quite a number of quite a quite a few relationships with a number of universities. I know we've, we've mentioned four there, but there are actually there are actually two or three others as well. In terms of interest in research and in this area for industrial use. They have industrial partners so we are seeing we'll only see growth for the for the process itself the ARCEMY process itself or the WAM process itself through those relationships and through those sales into universities and the like.
Giles Rafferty: Rounding out the ARCEMY suite of questions I suppose that have been submitted. This one's anonymous, but the question is, what kind of feedback are you getting from those people who have bought ARCEMY units are using ARCEMY units? And what are they saying to you about technology? Andy Sales: I guess they're quite happy. One of the reasons that most get involved with the process is that they can see the value, the value that that it offers. And currently at the moment, as I mentioned, there's quite a supply strain globally at the moment and we're actually seeing quite a number of inquiries starting to come in about the process now.
That's only reinforced by current customers and users that that's the reason why they're interested in the process itself. And the what the ARCEMY can can deliver. And given that it's quite a flexible unit. You know, from medium to large scale, it's across all metal types. Some of those customers are still asking questions, can we do this or can we do that? The answer predominantly is yes to most of their inquiries. So
Giles Rafferty: a lot of these questions have been forward looking another one from the Stuart Spouse who posed the question earlier, is actually looking back a little bit. It's asking about the status of the mandrill component that was submitted to Boeing some time ago. Andy Sales; Oh, yes. Okay. Yeah. Okay. Yeah, good question. We have recently been visited by Boeing actually, their global additive manufacturing director. So there's a relationship there with with that component that we delivered late last year, Boeing being a very large company, I can say, does take time to go through the process. So in terms of, you know, their internal testing their internal use of that mandrill, so we have been getting updates, albeit very few. It's about one a month that, yes, things are in
progress, but they've got a workload themselves. So once we get some good, tangible feedback on that we will actually update investors probably through our quarterly reporting and you know, if it's, if it's something tangible on its own, then we'll we'll disclose that on its own potentially, but we will update when we get when Boeing is done with what they're planning for that actual component. Giles Rafferty: I have a couple of questions that come from attendee John R, initial ours and John R and they're both about I guess the application of the technology was them. The competitors in this space, do competitors use welding wire and what is the closest competing technology? I guess he was getting to his how unique is AML3D By comparison, I guess to traditional welding. Andy Sales: I guess it's it is a welding process. And what I can also say is that all 3D printing processes, whether it be powder or using wire, are in its own form a welding process, because they all use a heat source to melt feedstock, whether it be wire or powder. So those various processes are
electric arc, which is what we use, yes, it is a welding process. Or it's a welding based process. There's electron beam and there's laser beams. So one of the reasons we use electric arc processing is that the hardware is a lot less complex than using electron beam and a laser beam to as a heat source to melt your feedstock. And in our view, you get a lot broader range of material use through the the arc welding electric arc welding technique that we use.
Broadly answer the question but yes, it is. It is a welding technology and I guess you know, something that I do always say as well as that welding technology, which ever heat source you're using is quite a well understood science, especially in the wire space. Powder space is still emerging, but it's well understood in the in the wire feedstock space. Hamish McEwin: When it comes
to the competitors Andy when we're talking about those few over a couple overseas that can produce on a scale like we can. We've got the advantage of you could effectively pick up a unit and stick it in anyway you can stick it in the corner of a factory you don't actually need a specific environment, which means the application is far more can be applied anywhere as opposed to competitors which are limited in where they can put them. Giles Rafferty: there are other questions along the same thing. John, John letter R initial has another question, again about how you apply the technology. This one is around.
It's quite it's quite specific Small Modular nuclear reactors and things like big pressure cooker type structures, and is this somewhere that the technology that AML3D has could be applied to a space like that? Is there an opportunity? Andy Sales: Yeah, I guess, the the it's an interesting space because typically, nuclear reactors use very high, high value very expensive materials, refractory materials such as titanium, tantalum, and that sort of thing. There is a lot of research still going on with some of the universities overseas in actually within the WAM in space actually within very similar processes overseas. I guess in terms of commercial use. It comes down to the opportunity. There's not much work in this region of the globe for us. Is it something that we would start looking at. Yes, potentially. If we saw the
opportunity, and the opportunity came to us, I guess, to answer the question, is it possible to apply our process to those materials. Well, as long as it's you know, bulk material, cost forged or normally billeted machined material that's machine down then. Yes, we could look at that. We probably haven't explored that space too much. But I'll
take note of that and actually, look at that now. Giles Rafferty: And rounding out the questions are an application of the technology Paul Nichols, as asked, Can you speak more about nanotechnology and where that fits in the mix? Andy Sales: Nanotechnology. I guess that's it's something that we are doing with with Flinders University and with the boron nano, the BNNT, high strength and a bit of opportunity with Deakin and IFM. So we're on boron nitride nanotubes are a lot like a nanoscale type fiber or metallic fiber that's used to strengthen aluminium matrixes. So we are looking at that side of things. Because if you look
at the the other side of nanotechnology, it does explore you know, down to the molecular and an atom level. We probably wouldn't do that with with our with our current capabilities, but we are involved in it with the BNNT. opportunity that we've got.
Giles Rafferty: I think this next question is probably gonna be one for both of you at some level, and it's the bundling together a few questions and some questions actually, that were submitted during the registration process. And what it boils down to is the funding and capital requirements of the business. Richard Liew has submitted a question live and as I say, there were some pre registration as well around this and the question boils down to what's your view of the funding and capital requirements for the business? Hamish McEwin: The Board is always assessing what our capital requirements are to not only sustain the existing business but for R&D and for expansion opportunities such as US/Europe. At this stage, we haven't actually yet as a board they have not come to a conclusion as to whether we need to do a raise down the track or or whether we can be self sustaining as we are. Andy Sales: I guess the drive for us is to become self sustaining. So that doesn't rule out any capital raisings in the future but we would typically look at the main reason for that will be growth, growth globally.
Giles Rafferty: always a tricky one. I've got another interesting question that we haven't really touched on and again, it's one of those where it can be hard to sort of foreshadow these things with a question from an anonymous attendee, and they're wondering would you consider acquisitions or joint ventures with other 3D printing companies? Does that fit into your thinking about how AML3D evolve? Andy Sales: I guess part of our strategy has always been to grow the company. We have a fantastic opportunity and I've always believed we've had a fantastic opportunity to grow globally. Since opening up, you know, five to six years ago with ago with our AC grant, our federal AC grant.
You know, some of our first inquiries were global. To answer the question directly, the answer is yes. And we have been fully aware of opportunities over the last sort of two to three years and this sort of fits into our overall strategy for growing the company. So I can't say that we're active right now. But we are definitely we've definitely planning for growth in all areas in all, you know, whether it be acquisitions, whether it be growth into establishing facilities in other regions.
We've analyzed it all and we are, we will be very active over the next two to three to four years. Hamish McEwin: Because our processes is medium to large scale. So it's not applicable across all areas, bolting on other additive manufacturing processes to expand our offering, yes, it's an obvious. Giles Rafferty: there's only so much you can say and I appreciate that because, you know, again, commercially sensitive, it's not until it's as good as it's not disclosed. Another question from an
anonymous attendee it's much more basic, but it's quite a stark question. It goes, Do you see AML3D as a software company, or manufacturing company? I imagined answer is somewhere in the middle, but I'll leave it up to you. Andy Sales: Both. We are predominantly software actually. We spend a lot of time
and we still do spend a lot of time in enhancing our software, which basically drives the hardware. So the printing aspect of it is just the final outcome. But I can safely say here, I guess that the predominant amount of time over the last few years has been developing the software capability. To go and print apart not to put it simply to go and printer parties. Just the final part of it. It's a significant amount of time that we've spent developing the software that we've gotten at the moment. Giles Rafferty: And we're very close to full time. And there's, as I said, it
was questions in advance and they actually still live questions coming through and whatnot. I know we got in the pre registration phase was speaking to sort of some of these larger macro themes and contemporaneous COVID has had an impact, the war in Russia is having an impact supply chains are on the rise. There's a lot of although starting to have an impact on AML3D, are you seeing consequences? How's that affecting your business? Andy Sales: Look, okay, so any cost increases when we pass on obviously, because that's just what everybody does. I guess it's very unfortunate to go from COVID over the last couple of years. So, you know, now we're seeing some effects of
this unfortunate war in the Ukraine. But very interestingly, we've had opportunity come to us because you know, whether it be COVID And the unfortunate circumstances of the war, there have been significant supply chain disruption. And end users, customers are looking for alternatives. We actually had an opportunity, our first opportunity going back 18 months ago, or 20 months ago now soon after COVID occurred where you know, supply chains were strained then and we were getting opportunities then. One thing I can say is that, you know, Russia and that area of the globe is a big supplier of aluminium and we've had no shortage of alternative inquiries about producing large, large structures in aluminium which is you know, aluminium.
High strength aluminium is one of our sweet spots, and it has been for a while. So. So yeah, very interesting times, and obviously, if anybody's thinking well, you know, okay, do we have constraints on why feedstock supply? Well, no. We don't because why feedstock is produced you know, fairly close. We've got good relationships with that supply chain and we have you know, we keep plenty of stock and and the availability of that compared to medium to large bulk metal items is significantly different. It's much much easier to get wire
feedstock thank bulk aluminium material at the moment, so we're seeing a positive outcome, while positive opportunities. Hamish McEwin: from a cost perspective, though, when when in product uses up to 70% Less than a traditional method. If you have rising commodity prices, it certainly benefits our business because we're not losing 70% of the cost of the commodity through Giles Rafferty: there are actually additional questions, but I think we've pretty much used it for full time. So we've overrun
a little bit on the time we allocated for the webinar. So thank you for your your time and patience, and for taking so many questions. I certainly will pass it any questions that weren't asked through to us you can have a look at those.
But given that we are over time, we must draw close to the webinar there. All it really remains for me to do is thank you Andy. Thank you Hamish for any running through the presentation and to both of you for taking the time to participate in such a comprehensive Q&A. Thank you very much and all the best thanks very much.