Ann: Foundation for 2016, page-2

Perth, WA and Greer, South Carolina: Alexium International Group Limited (Alexium) (ASX:AJX, AX:AJX, OTC
QX:AXXIY) is pleased to share our foundations for 2016. Alexium’s mission is to develop unique IP Protected
Formulations centered on our award winning flame retardant (FR) technologies, together with add on products,
to provide a diverse portfolio of quality, environmentally-friendly chemical solutions to satisfy the needs of our
customers worldwide, whilst being a recognized leader in FR technology and environmental stewardship.
To date, Alexium has been rapidly delivering on its target of establishing a global footprint. Leading into 2016,
we have already secured over 45 customers for an approximate US$18.5M (baseline) of earnings, within a
potential order book of US$44.7M from these customers alone for 2016.
KEY SUCCESSES & HIGHLIGHTS DEFINED BY MARKET SEGMENTS
1. HOME FURNISHINGS
2. DEFENSE SECTOR
3. WORKWEAR
4. TRANSPORTATION
5. OUTDOOR FABRICS
6. COATINGS/POLYMERS
HOME FURNISHINGS
The US FR market size in the home furnishings sector is US$132M with an estimated 2016 total revenue
potential to Alexium of US$14.5M. Alexium has secured 38% of our overall 2016 baseline group revenue
through current home furnishings customers.
Our first commercial success of 2015 came from the Bedding/Mattress market segment in the Home
Furnishings Industry. We partnered with a major bedding supplier to provide FR treatment for fabrics used
for top of the line mattresses. Throughout the development of this treatment with our customer, our
Product Development group worked closely with the fabric source to ensure our chemistry was compatible
with all other components. As a result, this effort expanded the scope of the initial project and increased
purchase orders to accommodate additional customer needs. The collaboration also led to Alexium
developing Alexiflam Crockban and Next-Generation cooling phase change chemistry.
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DECEMBER 16, 2015
Corporate Headquarters, Alexium International Group Limited,
Level 18 Central Park, 152-158 St Georges Tce Perth Western Australia 6000
Our Product Development Group also assisted a major fabric supplier by successfully treating a high content
polypropylene fabric. These fabrics are traditionally difficult to treat and the Alexiflam FR treatment enabled
the CFR 1633 bed burn test to be passed. We expect to see increased Alexiflam FR orders before year end to
support the expansion of our business into this area. In another area of protection for mattresses, we are
expecting to run plant trials on knitted materials to create “FR socks”. These socks, which are the industry
standard method of protecting a foam mattress and currently contain modacrylic and the heavy metal,
antimony, hence leading to scrutiny by regulators. In addition, the memory foam mattress is gaining an
increasing amount of total mattress market share and this is an area that Alexium is intent on offering its FR
solutions.
We also continue to work with a large commission finisher to fine tune formulations using the Alexiflam FR
product for which we expect to see orders and co-branding in January. Another focus and growth area for
our FR products is the drapery market.
DEFENSE SECTOR
The US FR market size in the military sector is US$240M with an estimated 2016 total revenue potential for
Alexium to US$13M. Alexium has secured 23% of our overall 2016 baseline group revenue through current
Defense Sector customers/existing contracts.
This has been a break out year for Alexium in the Defense Sector. Alexium completed and delivered on stage
one- Environmentally-Friendly FR Nylon-Cotton (NyCo) Fabric to Natick (US Army Solider Systems Center) for
down select testing. As a result, Natick selected Alexium to proceed to the second stage of development of
non-inherent FR 50/50 NyCo Uniforms during the month of August. During this time our CEO, Nick Clark met
with Key Officials on Capitol Hill to encourage legislation aimed at the deployment of safer, durable, FR
uniforms for all military personnel, not just in combat situations.
In October, the US Department of Defense (DoD) selected Alexium as Key Partner for the New Fire Retardant
Uniform Fabric. Alexium is now working with a major US defense Sector contractor for large scale field trials
of their NyCo uniforms, treated with Alexiflam.
In addition, we have had four successful burn tests and plant trials with a second primary military supplier for
high performance textile applications for new their NyCo FR uniforms.
Murdock Webbing, a leading DoD contractor for strapping and webbing, provided a large initial Purchase
Order for Alexium FR treated goods. We recently finalized a Royalty Program with Murdock Webbing, set to
commence in January 2016.
Finally, Alexium has been working with a new Defense Sector customer for advanced textiles comprised of
exotic materials for specific Defense Sector applications. Along with this initiative, Alexium received a new
purchase order from a Defense Sector contractor to advance progress on these next generation Defense
materials.
Corporate Headquarters, Alexium International Group Limited,
Level 18 Central Park, 152-158 St Georges Tce Perth Western Australia 6000
WORKWEAR
Recent developments in the Defense Sector have shown that our NyCo fabrics pass the NFP 2112 body burn
required for many workwear applications. Our partners, iTextiles, have scheduled overseas trials both in Poly
Cotton and NYCO overseas where we see the biggest immediate opportunities.
TRANSPORTATION
The US FR market size in the transportation sector is US$52.8M with an estimated 2016 total revenue
potential to Alexium of US$9M. Alexium has secured 22% of our overall 2016 baseline group revenue
through current transportation market customers.
We have run successful plant trials in Europe through our partner iTextiles. Test results have just been
received showing our FR treatment far surpasses all requirements on their main line of fabrics. Additional
orders for chemistry are expected soon as they scale up for full production. We are progressing our search
for overseas production capability to support the Eurasia market area.
Domestically, we have run several plant trials at 2 key domestic automotive suppliers. In addition, we are
working with a supplier of aircraft carpeting on treating their products.
OUTDOOR
The US FR market size in the outdoor sector is US$52.8M with an estimated 2016 total revenue potential for
Alexium to US$4.2M. Alexium has secured 8% of our overall 2016 baseline group revenue through current
outdoor market customers.
We are working with a major US domestic Camping & Outdoor company on finalizing contracts with an Asian
based finisher. All tests and laboratory work are complete, ready to ship chemistry. Further, we are working
with one of the largest US outdoor retailers for an FR treatment of their tent fabrics.
Product development has continued to develop a soak durable FR treatment for cotton tenting. We have
fabric on order to run plant trials when the formulation is complete. There are at least 3 potential customers
waiting for this product so they can service the substantial United Nations (UN) Refugee Tent market.
NEW PLATFORM FOR 2016
COATINGS/POLYMERS
The US FR market size in the coatings/polymers sector is US$270M with an estimated 2016 total revenue
potential to Alexium of US$4M. Having only entered this market in the last quarter, Alexium has gained new
customers and has already secured 9% of our 2016 baseline group revenue.
By using our expertise in coating chemistries, we successfully expanded into the coatings/polymers markets
in 4Q 2015 ahead of schedule, with the launch of Alexiflam SYN-FILL.
Alexiflam SYN-FILL was developed for applications in the composites, adhesives, laminations, resins, films,
coatings and masterbatch processes. Potential end uses cover a wide range from engineered molded plastics
to building construction to industrial fibers. This initial effort outside of the textiles arena will be a bright star
in our future. We have successfully completed plant trials for PET treated film in 4Q 2015 for application in
Corporate Headquarters, Alexium International Group Limited,
Level 18 Central Park, 152-158 St Georges Tce Perth Western Australia 6000
the consumer electronics market. Our product has the ability to be scalable which also differentiates us in
the market.
We recently began working with a resin provider to the electronics industry and laboratory scale trials show
excellent results and we have received an initial purchase order for plant trials. Another customer has shown
interest in our Alexiflam SYN-FILL chemistry to be applied in their resin products that are aimed at the
construction industry.
The large FR coatings and polymers market is the most exciting market to emerge in 2015 for Alexium, even
considering our break out year in the Defense Sector. Expanding the Alexium FR product line into the large
non-textile markets, where brominated and halogenated FR products have been the mainstay over many
years, has been a key part of our strategic development. Our ability to provide an environmentally friendly,
cost effective and performance enhancing FR solution as a safe and effective FR replacement technology in
these large and valuable markets is a further demonstration of the depth of our capabilities in the FR area.
BEYOND 2016
2015 was a very successful year as Alexium made a dedicated approach in the commercial textiles sector while
continuing its focus on the Defense Sector. Through development of these two sectors with our core
technologies, Alexium expanded research and development to specialty surface technologies in the
coatings/polymers markets. In addition, Alexium began expanding on its core FR technologies to provide
additional solutions to further meet our customers’ needs.
Through these developments, Alexium is positioning to be a major global player in the Flame Retardant
Chemistry market whilst providing our customers with a complete multi-platform, environmentally friendly,
chemical solution package. We intend to be a major force in every market sector we serve and have established
the foundation and mechanism to drive us to that end.
U.S Contacts:
Nick Clark
Chief Executive Officer
[email protected]
Bradi Dobson
Marketing Specialist
[email protected]
U.S. R&D Center:
8 Distribution Court
Greer, SC 29650
T: +1 864.416.1060
F: +1 864.752.6465
U