Calix Ltd

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From the Prospectus

Calix has developed a patent-protected, platform technology that produces new materials and processes, targeted at solving some significant global challenges. The core technology platform is a reinvention of the kiln process, which can produce high purity, high surface area products that have high levels of reactivity.

Chairman’s Letter

On behalf of the Directors, I am pleased to offer you the opportunity to become a shareholder in Calix Limited.

Calix has developed, and is commercialising, a technology platform that produces valuable new materials and processes that are targeted at solving some significant global challenges.

At the core of Calix’s business is a world-first, patented, Australian technology that has reinvented the kiln process and is called the Calix Flash Calciner (CFC). The materials produced in the CFC have unique properties, similar to those of nanoparticles, being highly reactive, but without the cost and handling challenges associated with nano-particles. The CFC process also allows for the direct separation of CO2, allowing it to be used for CO2 reduction in traditionally CO2 intensive industries, such as lime and cement production.

Calix has made significant commercial progress since bringing its first products to market in 2013. Calix’s product development pipeline can be categorised as follows:

  • Commercialised products – targeting wastewater treatment, and sewer infrastructure protection;
  • Pre-Commercial products – targeting water conditioning in aquaculture and crop protection in agriculture; and
  • Advanced research and development (R&D) projects – targeting CO2 separation in lime and cement manufacture, and advanced materials for batteries and energy storage.

In an external market report produced for Calix, Frost & Sullivan estimates that the addressable global market opportunity is approximately A$62 billion for Calix’s commercialised product portfolio, approximately A$11 billion for the pre-commercial products, and in excess of A$20 billion for its advanced R&D projects.

While early in its commercialisation strategy, Calix has achieved a compound annual revenue growth for its core products of 41.8% between 2015 and 2017, with revenue growth of 34.2% achieved in the first half of this financial year (as compared to the first half of the 2017 financial year).

Calix is led by an experienced board and management team, who together with staff, will own approximately 19.7% of Calix’s issued capital following listing on the ASX. This personal ownership and commitment is part of our culture.

Calix’s strategy is to continue the commercialisation of its wastewater treatment and sewer infrastructure protection products both in Australia and New Zealand, while also expanding its market entry in the US. Calix will also continue commercialising its aquaculture and agriculture products, together with progressing the development of its R&D pipeline with a view to staying ahead of technology advancements. We have a clear view of our priorities.

The purpose of the Offer is to provide funding for Calix’s growth strategy including:

  • enhancing the efficiency of its existing production facilities to drive margin expansion;
  • expanding its sales and marketing capabilities to increase revenues and enter new markets;
  • to continue specific R&D projects;
  • to provide working capital;
  • to provide liquidity for its shares; and
  • to provide Calix with the benefits of an increased profile as a listed entity.

This Prospectus contains detailed information about the Offer, the historical financial results of Calix and the material risks associated with an investment in Calix.

Before applying for Shares, any prospective investor should be satisfied that they have a sufficient understanding of the risks involved in making an investment in Calix. These include risks associated with the competitive environment for commercialising new products, the ability to attract and retain customers, R&D risk, regulatory changes, protection of intellectual property and reliance on key personnel. Please refer to Section 4 for further details.

I encourage you to read this document carefully and in its entirety before making an investment decision.

On behalf of my fellow Directors, I look forward to welcoming you as a shareholder of Calix.

Peter Turnbull

Chair