ACCELERATING THE ENERGY TRANSITION

Financial & Operational

Highlights

1,204.7

Revenue $m

208.2

Gross Profit $m

136.7

EBITDA $M

90.8

CASH FROM OPERATING ACTIVITIES $M

(3)

WORKING CAPITAL DAYS

284.5

NET DEBT $M

0.39

LOST TIME INCIDENT RATE

1.08

TOTAL INCIDENT RATE

0.44

DILUTED EARNINGS PER SHARE $

AMG GROUP

1,204.7

REVENUE $M

136.7

EBITDA $M

AMG CLEAN ENERGY MATERIALS

381.5

REVENUE $M

66.6

EBITDA $M

AMG CRITICAL MINERALS

308.5

REVENUE $M

31.2

EBITDA $M

AMG CRITICAL MATERIALS TECHNOLOGIES

514.7

REVENUE $M

38.9

EBITDA $M
Revenue By End Market
34%

Transportation

25%

Specialty Metals
& Chemicals

23%

Infrastructure

18%

Energy

Circle illustration showing percentages of revenue by end market.
From the CEO

Letter to
Shareholders

The EBITDA in 2021 of $137 million exceeded our guidance of $120 million published on May 5, 2021 and we see it as a bridge to the EBITDA target for 2022, currently guided to be $225 million or more.

AMG LOST TIME INCIDENT RATE
A bar graph showing the lost time incident rate. Year 2021 is 0.39.

AMG
Clean
Energy
Materials

AMG Clean Energy Materials spans the vanadium, lithium, and tantalum value chains, combining our recycling and mining operations producing materials for infrastructure and energy storage solutions while reducing the CO2 footprint of both suppliers and customers.

AMG Clean Energy Materials’ gross profit before non-recurring items in 2021 increased by $59.0 million, from $21.3 million to $80.3 million, driven largely by the improved price environment compared to 2020. EBITDA grew $56.0 million over 2020, from $10.6 million to $66.6 million in 2021. 

The segment advanced several key strategic programs in 2021. The construction of AMG Vanadium’s second spent catalyst recycling facility in Zanesville, Ohio, a $325 million investment and AMG’s largest capital project to date, is proceeding as planned. Commissioning has begun and the plant is forecast to achieve full run rate capacity in the fourth quarter of 2022.

Shell & AMG Recycling B.V. (SARBV) continues to pursue circular refinery residue opportunities globally; this project advances the goals of a circular economy. To close the loop between “fresh” and “spent” catalysts is another building block for achieving the societal benefits of reducing global CO2 emissions compared to the mining of vanadium.

AMG Brazil will increase its spodumene production by 40,000 tons, from 90,000 tons per year to 130,000 tons. It is currently in detailed engineering, with construction planned to commence at the beginning of the second half of 2022, and mechanical completion at the end of the first quarter of 2023.

In January 2021, AMG Brazil entered into an Exclusive Cooperation Agreement (“ECA”) with one of its major customers for lithium concentrates. The ECA provides for AMG Brazil to supply 200,000 tons over a 5-year supply term, which will be obtained from the expansion (targeting 40,000 tons per annum) of AMG Brazil’s existing lithium concentrate plant. The ECA includes an advanced payment for lithium concentrate which will fund AMG Brazil’s investment in the expansion.

In October 2021, AMG’s Supervisory Board approved the construction of the first module of a battery-grade lithium hydroxide upgrader in Bitterfeld, Germany. Site preparation and building site facilities have started in Bitterfeld, Germany and commissioning for the first module of the battery-grade lithium hydroxide upgrader will commence in the third quarter of 2023.

AMG is building its first LIVA (lithium vanadium) battery for industrial power management applications. To manage its entrance into this market, AMG acquired Phyr7 GmbH, Heidelberg, a specialist for artificial intelligence-based power management solutions. The first AMG industrial battery has a power of 0.6 Megawatts and will flatten the electricity demand curve of our graphite processing operations. A second LIVA battery is planned for Ohio with four times the power. These innovative LIVA batteries will be turned into a product line to compete with diesel engine power units for industrial applications.

In December 2021, AMG Brazil’s mine site reached over 1,000 days without a Lost Time Incident. This momentous milestone was only possible because of AMG Brazil’s certified HSE management system rigorously identifying and mitigating risks and hazards, as well as each employee’s disciplined attitude and proactive responsibility for creating a safe working environment.

AMG
CRITICAL
MINERALS

AMG Critical Minerals was formed at the beginning of 2021 by combining AMG’s mineral processing operations, AMG Antimony, AMG Graphite and AMG Silicon into one division.

AMG Critical Minerals’ revenue during 2021 was 45% higher than 2020 due to improving metal prices as well as increased volumes, thereby propelling gross profit before non-recurring items for the year from $36.8 million to $48.7 million.

EBITDA in 2021 increased 21%, from $25.9 million in 2020 to $31.2 million, due to higher profitability mainly caused by rising metal prices.

AMG Critical Minerals benefited from increasing metal prices compared to the prior year. This was partially offset, however, due to higher energy and shipping costs in the second half of 2021, which were only partially passed on to customers. However, AMG’s hedging programs, contract terms, and end market price increases are, to a very large extent, covering these additional costs.

AMG
Critical
Materials
TECHNOLOGIES

AMG Critical Materials Technologies combines our leading vacuum furnace technology line with high-purity materials serving global leaders in the aerospace sector.

AMG Critical Materials Technologies’ revenue during 2021 increased by 8% due to higher profitability related to sales price increases for the titanium alloys and chrome businesses compared to 2020. Consequently, gross profit before non-recurring items for the year increased by $13.9 million to $84.3 million.

EBITDA in 2021 increased 28%, from $30.3 million in 2020 to $38.9 million, largely as a result of the improved metal prices as well as higher sales volumes of chrome metal.

Order intake in the Engineering business unit in 2021 remained strong at $227.5 million, representing a balanced 1.00x book to bill ratio. Order backlog was $188.2 million at the end of 2021, compared to $198.1 million at the end of 2020. The Company is experiencing higher volumes of smaller orders due to diversifying outside of the aerospace market, which reduces the period ending order backlog but does not indicate lower profitability levels.

The impact of the coronavirus is most significantly felt in AMG within the Critical Materials Technologies segment. However, the aerospace market continues to show signs of improvement, and our customers are forecasting increases in requirements by mid 2022.

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