Announcement PDF Australia’s future in bioenergy and renewables Annual Report 2024 Delorean Corporation Limited ACN 638 111 127 Table Of Contents Company Overview ......................................................................................................................................... 3 Corporate Directory ........................................................................................................................................ 4 Investment Highlights ..................................................................................................................................... 5 Chairman’s Address ......................................................................................................................................... 6 FY2024 at a Glance .......................................................................................................................................... 8 Directors’ Report ............................................................................................................................................ 10 Auditor’s Independence Declaration ..............................................................................................................38 Consolidated Statement of Profit or Loss and Other Comprehensive Income ...............................................39 Consolidated Statement of Financial Position ................................................................................................40 Consolidated Statement of Changes in Equity................................................................................................41 Consolidated Statement of Cash Flows ..........................................................................................................43 Notes to the Consolidated Financial Statements............................................................................................44 Directors’ Declaration .....................................................................................................................................98 Independent Auditor’s Report ........................................................................................................................99 ASX Additional Information ..........................................................................................................................103 DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 2 Company Overview Annual Report Vision This annual report provides a summary of our activities and performance for the financial year ended 30 June 2024. To be recognised as Australia and New Zealand’s leading emerging renewable energy generator Mission Delorean Corporation We are a leading bioenergy company in Australia, committed to sustainability and innovation. Our solutions are paving the way towards a greener future, reducing environmental burdens and powering a cleaner, more sustainable Australia. To build, own and operate the largest portfolio of commercially successful renewable energy infrastructure in Australia and New Zealand, measured by value of developed assets and quantity of renewable electricity, heat and renewable gas produced. renewable energy generator d retailer, led by its fastgrowing bioenergy infrastructure footprint. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 3 Corporate Directory Directors Mr Hamish Jolly Mr Joseph Oliver Mr David McArthur Mr Stephen Gostlow ASX Code Shares: DEL Company Secretary Mr David McArthur Country of Incorporation and Domicile Australia Legal Form of Entity Public Company Contact Details deloreancorporation.com.au info@deloreancorporation.com.au +61 8 6147 7575 Registered and Principal Office Ground Floor 1205 Hay Street WEST PERTH WA 6005 Corporate Governance Statement https://www.deloreancorporation.com.au/ corporate-governance/ Postal Address Ground Floor 1205 Hay Street WEST PERTH WA 6005 Auditors RSM Australia Partners Level 32, Exchange Tower 2 The Esplanade PERTH WA 6000 Bank Commonwealth Bank of Australia Level 14B, 300 Murray Street Perth WA 6000 Share Registry Automic Group Level 2, 267 St Georges Terrace PERTH WA 6000 Telephone: 1300 288 664 DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 4 Investment Highlights Delorean Corporation (Delorean) is Australia’s leading bioenergy infrastructure developer, builder, owner and emerging operator. Delorean is a vertically integrated business operating in two high growth investment sectors – renewable energy and the circular economy. The Company has a strong track record in delivering engineering, procurement, and construction (EPC) contracts for industry and government and is closing in on its goal to roll out a backbone of Delorean-owned bioenergy infrastructure projects across Australia, supported by some of Australia’s most iconic companies. Progressed a $30m Corporate Financing Package $5.0m EBITDA $8.8m Cash at Bank Record NPAT in FY24 Progressed Brickworks NSW1 Joint Development Advanced SA1 / VIC1 Strategic Partnerships Unique high yielding investment opportunity in the bioenergy sector ✓ Delorean is the only Build-Own-Operate (BOO) Bioenergy developer in Australia with a strong track record of delivering successful projects in ANZ ✓ Delorean is uniquely positioned to develop its strategic portfolio of BOO projects with significant industry partners Long-term value upside ✓ High margin business with contracted revenue flows – predictable and stable income once assets are operational, underpinned by long-term contracts and attractive project economics ✓ Unique proposition on the ASX providing equity exposure to shovel ready projects that demonstrate significant project-level IRRs Attractive industry dynamics with strong growth potential ✓ Bioenergy industry has significant ‘green’ tailwinds driven by demand for renewable energy production and waste diversion ✓ Use of organic waste to create gas enables sale of gas at a ‘green’ premium and at a time of significant undersupply DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 5 Chairman’s Address A Transformational Year – Kickstarting DEL’s Own Infrastructure Financial Year 2024 was a transformational year for Delorean Corporation with the Company posting a record profit as a result of ongoing success in our base EPC business, securing iconic strategic partnerships and refocusing Delorean’s pathway for rollout of our BuildOwn-Operate bioenergy projects. The Company continues to be buoyed by significant tailwinds in the bioenergy industry with demand for domestic green gas far outpacing supply and waste diversion initiatives being a key plank in commercial and government sector forward planning. The Company’s focus on developing its BOO portfolio in FY24 has culminated in the subsequent securing of a partnership with Tanarra Group to finance the construction of the SA1 project, the first in the Company’s BOO portfolio. These Delorean-owned development projects have demonstrated high project-level IRRs and are key to unlocking the Company’s strategic objective of securing annuity based and high-margin revenue streams. The Tanarra facilities enable the provision of a 3-year term corporate finance facility package of up to $30m with the funds to be deployed to fund construction of the SA1 Project in Edinburgh Parks near Adelaide in South Australia. The facility is flexible and will enable Delorean to progress the construction of its second shovel ready project VIC1 (90% Delorean-owned) in Stanhope, Victoria in parallel to SA1. The Company hopes to refinance the Tanarra construction facility in full at the 3-year maturity, with terms in line with typical longer-term project financing solutions. SA1 construction is expected to commence in Q2 FY25 with first gas expected in Q3 FY26, subject to Delorean’s Final Investment Decision (FID). During the year, Delorean’s base EPC business continued to perform strongly with the successful completion of the Ecogas bioenergy facility in New Zealand for project developer, Pioneer. We are pleased to report that the Company is also engaged to provide an initial 2-year post-commissioning Operate and Maintain (O&M) contract. In January 2024 the Company also made a start on the $54m construction of Yarra Valley Water’s second bioenergy facility in Lilydale, Victoria, with completion of construction scheduled for April 2025 delivering ongoing revenues into FY25 and follow-on O&M revenues post-commissioning. In FY24, Delorean successfully secured $1.3m of earnings in execution of its trading strategy on Large Scale Generation Certificates relating to the Company’s energy retail division, with that strategy set to continue into FY25. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 6 Outlook for The Year Ahead Looking forward the Company expects sustainable earnings into FY25 with contracted EPC and O&M revenues on its third-party Ecogas and Yarra Valley Water construction projects. These cash flows will continue to support Delorean’s move into build of its SA1 and VIC1 BOO projects enabling overhead recovery against these high-IRR projects. As these facilities become operational (expected from Q3 FY26 onwards), they will generate revenues from fees for acceptance of organic waste streams and from sale of renewable gas, green electricity and environmental credits. Delorean is continuing to explore additional revenue streams, including the sale of natural byproducts such as biofertiliser and commercial-scale carbon dioxide products. In FY24, Delorean continued the collaborative development of the NSW1 BOO bioenergy project under agreements with Brickworks, with this project reaching the next stage of development. The project is expected to progress to Financial Investment Decision (subject to normal investment and funding parameters) with Delorean commencing construction inside FY25. Delorean was also active in the development of its QLD1 BOO project, for which it successfully secured $5m in funding from the Queensland Government towards project construction. This funding, announced on 28 February 2024, is subject to planning approvals and FID expected in FY25. With a record year of profit under our belt, a solid revenue outlook for FY25 and now funded to kick off construction of our high-yielding BOO project rollout, the prospects for Delorean have never been better. A big vote of thanks to our dynamic team at Delorean and members of our Board, and to our shareholders for their ongoing support for our company vision, which we believe will be well rewarded in shareholder value as we continue to develop and bring onstream our own infrastructure in this high-growth sector. Yours sincerely, Hamish Jolly Executive Chair DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 7 FY2024 at a Glance In FY2024, Delorean Corporation achieved significant advancements across multiple projects, further strengthening its position as a frontrunner in the Australian bioenergy industry. Financial GROUP REVENUE GROUP ASSETS UNDER MANAGEMENT $ 27.9m $ 28.1m FY24 NET PROFIT AFTER TAX FY23 $ 4.8m FY22 OUTLOOK FOR THE FY2025 DEL BOARD ASPIRATIONAL STRATEGIC OBJECTIVE $ 54m $ 300m Contracted Works FY25 and beyond enterprise value by FY2028 DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 $17.9m $24.1m 8 Strategic strengthening its position as a frontrunner in the Engineering Delorean is regarded as a leading contractor in the bioenergy industry. 3 award-winning bioenergy infrastructure projects completed $54m Yarra Valley Water bioenergy project in build Zero lost time incident rate (LTIR) – a perfect safety record Infrastructure Delorean is the only Build-Own-Operate bioenergy developer in Australia, actively expanding its strategic portfolio of BOO projects in collaboration with key industry partners. $30m financing package with Tanarra Group (completed Sept 2024) Delorean QLD1 Project awarded $5m grant Collaboration agreement with ATCO Gas Advanced DEL BOO portfolio Brickworks NSW1 Joint Development project reached significant milestones Focused on securing project finance for its $500m bioenergy portfolio Corporate Delorean has solidified its market position as the leader in the rapidly growing bioenergy sector, enhancing both its operational efficiency and strategic capabilities to drive continued growth and innovation. Developed design and process Intellectual Property (IP) Completed ISO certification audit to ensure continued compliance DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 New Chief Operating Officer appointed; strategic hires in Engineering and Infrastructure teams 9 Directors’ Report The Directors’ present their report together with the financial statements of Delorean Corporation Limited (“Delorean” or “the Company” or “DEL”) and its subsidiaries (“the Consolidated Entity”) for the financial year ended 30 June 2024 and the auditor’s report thereon. Our Board Delorean’s Board comprises a balance of strong and committed executive leadership through its co-founders, Executive Chair Hamish Jolly and Managing Director Joe Oliver, paired with Steve Gostlow’s deep knowledge and track record in the Australian waste sector with Tox Free Solutions Ltd, and David McArthur’s decades of experience in the complexities of ASX-listed businesses. The Board functions well with the Non-Executive Directors providing guidance on finance, performance management and M&A strategy. Together, the Directors hold 42.19% of DEL’s issued capital and are motivated to guide the Company to meet its growth and profitability targets and realise the Company’s vision. Strong Leadership Hamish Jolly Executive Chair & Co-Founder Hamish is a seasoned executive and holds a Bachelor of Business (Business Law and Accounting) and is a Member of the Institute of Chartered Accountants in Australia and New Zealand. He is a former Director of Strategy and Ventures at Bankwest, and former CEO of Greening Australia, one of Australia’s largest environmental NGO’s. Joe Oliver Managing Director & Co-Founder Joe has over 15 years’ experience in engineering, power generation and renewable energy across both Australasia and Europe. Prior to Delorean, Joe worked for Edina Ltd, specialising in power generation. Joe has been involved in developing the UK Anaerobic Digestion sector delivering over 10 facilities nationwide through both Farmgen Ltd and Monsal Ltd. Steve Gostlow Non-Executive Director Steve has over 20 years’ experience in the waste management industry. He was Managing Director of Tox Free Solutions Ltd (Toxfree) for 16 years where he developed Toxfree into one of Australia’s largest waste management companies. Steve has formal governance qualifications as a Graduate of the Australian Institute of Company Directors. David McArthur Non-Executive Director & Company Secretary David is a Chartered Accountant, with over 30 years’ experience. David has sat on the board and been company secretary for a number of listed companies including Lodestar Minerals Ltd (ASX: LSR), Xstate Resources Ltd (ASX:XST), Australian Oil Company Ltd (ASX: AOK), as well as Harvest Technology Ltd (ASX:HTC). Additionally, he was also chair of Audit and Risk Management Committee for all four. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 10 Directors’ Report (continued) Operating and Financial Review Principal Activities Delorean is a leading builder, energy retailer and developer of bioenergy infrastructure throughout Australia. The principal activities of the Consolidated Entity during the financial year were: • • • • Renewable energy asset investment Development Construction Tank and infrastructure fabrication Overview Delorean Corporation was established in 2013 as a pioneering bioenergy EPC provider in Australia and New Zealand. Delorean has successfully delivered 3 award-winning bioenergy projects (Jandakot WA, Blue Lake Milling SA, Ecogas NZ). Currently, we are constructing our fourth and biggest project to date, valued at approximately $54m, for Yarra Valley Water. The advancement of Delorean’s infrastructure development pipeline has enabled Delorean to transition into a ‘build, own and operate’ business model. Delorean is driving revenue growth through three business segments: • Infrastructure (core): The rollout of Delorean owned bioenergy projects through partnerships • Engineering: Supporting the EPC and O&M of Delorean’s own projects, while selectively taking on thirdparty work • Energy Retail: Retailing energy (electricity and gas) generated solely from Delorean projects Company Highlights ✓ Delorean is a profitable business with a strong revenue growth profile – a business that has demonstrated its ability to deliver award winning projects nationally and overseas. ✓ Delorean has the right team to execute – the management team brings over 50 years of combined experience in the bioenergy industry. With strong industry connections and credibility, the team is wellpositioned to drive successful project execution. ✓ Delorean’s position in the market is unique – the Company has a mixture of EPC and O&M revenue streams, combined with build- own-operate projects that are ready for construction, with a large portfolio of development projects in strategic locations. With a firm foothold in the renewable energy landscape and a strong commitment to driving positive change, Delorean Corporation is incredibly well placed to capitalise on the major and long-term structural shift in gas demand. Our steadfast commitment to advancing sustainable solutions and expanding our portfolio exemplifies our purpose of shaping a cleaner future for Australia and New Zealand. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 11 Directors’ Report (continued) Operating and Financial Review (continued) Bioenergy Plant Revenue Model Bioenergy plants benefit from multiple revenue streams, deriving income from various sources such as waste acceptance and processing, as well as sale of renewable electricity, heat and gas. Furthermore, there are prospects for additional revenue streams in the future, including the sale of biofertiliser, CO2, hydrogen and environmental credits. These opportunities contribute to the overall financial viability and sustainability of bioenergy operations. Attractive Industry Dynamics with Strong Growth Potential Delorean is ideally positioned at the intersection of two high growth industries – waste management and renewable energy. Renewable Energy The shift towards renewables is supported by active federal and state government action, with recent policies focusing on meeting emissions, affordability, reliability and sustainability targets. Bioenergy is expected to benefit from this trend, as it offers consistent baseload power that wind and solar power lack. Waste Management Governments across Australia are implementing policies to reduce landfill waste and transition to a circular economy, including setting targets for landfill diversion and increasing waste levies. These trends are expected to drive the urgency to divert organics from landfills and incentivize feedstock suppliers to find alternative disposal options, further enhancing Delorean’s revenue from gate fees. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 12 Directors’ Report (continued) Operating and Financial Review (continued) Vertically Integrated Renewable Energy Business Delorean is a vertically integrated business operating in the organic waste management sector and the renewable energy sector (particularly renewable gas). Both sectors have strong macro drivers for growth and are rapidly developing. Within this structure, Delorean has the inhouse capability to deliver bioenergy projects across the full lifecycle, from project conception to commissioning and operation; processing organic waste and generating and monetising renewable electricity, heat and gas. EPC Projects progressing with DEL-owned Project Development and Build Pipeline DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 13 Directors’ Report (continued) Operating and Financial Review (continued) Delorean Engineering Division Revenue EBITDA FY24 $ FY23 $ 26,557,063 5,907,124 3,138,787 (4,827,819) FY2024 EBITDA shows the impact of advancing engineering projects across each phase of the project life cycle, with the results of the Engineering Division returning to profit. The engineering division has been focused on the project delivery of Yarra Valley Water’s bioenergy project and progressing design works across the project portfolio, including supporting the infrastructure division with engineering detail for development approvals and early-stage Front End Engineering Design and Operation and Maintenance support of our completed projects. Yarra Valley Water, VIC Bioenergy Plant Project Background Location: Lilydale, Victoria - $54M + $6.5M contract value Delorean Corporation’s Engineering Division was awarded the contract for the design, construction, operation, and maintenance of Yarra Valley Water’s second food waste to energy plant at Lilydale, Victoria. This new facility will be one of the largest food waste to energy facilities of its kind in Victoria. The total design and construction contract sum is $54M. Additionally, the contract includes a two-year agreement for operations and maintenance (and an option for digestate management) by Delorean with a value of $6.5M. Project Update Following the receipt of final regulatory and development approvals, completion of bulk earthworks and concrete works, the project has entered the full construction phase. Anaerobic Digestion inlet and outlet tanks are being constructed and shed and equipment installation is due to commence early October 2024. Image 1 & 2: Yarra Valley Water Construction Works DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 14 Directors’ Report (continued) Operating and Financial Review (continued) Delorean Engineering Division (continued) Ecogas, NZ Bioenergy Plant Project Background Location: Reparoa, New Zealand Delorean Corporation’s Engineering Division was contracted for the design, turnkey build and commissioning of this bioenergy project in Reparoa, New Zealand. The completed project is taking food organics from Auckland City Council collections, with the energy produced supplying a major greenhouse operation. This bioenergy facility is New Zealand’s first commercial scale anaerobic digestion plant. Project Update In FY24, Delorean was actively involved in the technical support of the operation and maintenance for the Ecogas bioenergy facility. The plant, which reached Practical Completion in Q4 FY2023, has been successfully producing green electricity and biofertilizer. Image 2: Ecogas bioenergy facility Image 3 & 4: Ecogas Bioenergy Facility DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 15 Directors’ Report (continued) Operating and Financial Review (continued) Delorean Infrastructure Division Revenue EBITDA FY24 FY23 $ $ 1,244,605 164,566 385,588 (24,949) Revenue for the Infrastructure Division relates to the Brickworks development contract in both financial years. The growth in revenue and EBITDA for FY24 reflects the increased level of activity on the project as development work accelerates through the planning approval process. Outside of Brickworks, the majority of the Division’s expenditure is capitalised to the bioenergy portfolio of owned assets in the infrastructure pipeline (i.e. SA1, VIC1), supporting the transition to Build Own Operate model. Project Finance Subsequent to financial year end (September 2024), the Group executed contracts with Tanarra Group for a $30m corporate debt facility, with $25m from that facility allocated to development of DEL’s first build, own, operate project: SA1. This result followed from a detailed review process of potential investment partners undertaken throughout FY2024. The facility will unlock the Group’s build, own, operate strategy, initiating our first project build and providing a platform for further developments. The facility can be paired with non-recourse debt in the project SPVs, to enable DEL to move additional projects into build. These activities will underpin the Company’s future growth trajectory, ensuring sustained momentum and value creation. SA1 Bioenergy Plant Project Background Location: Salisbury, South Australia In Stage 1 it will process 70,000TPA of organic waste, generating 200 TJs of biomethane per annum. This will contribute to 92,200 tonnes/annum emissions reduction, the equivalent of powering 5,120 homes with green energy per year. Project Update Tanarra funding (as above) contains $25m for project build costs, which will be used to finance the construction of the 100% Delorean-owned SA1 Project in Edinburgh Parks, near Adelaide, South Australia. The project is currently shovel ready and construction is expected to commence in Q2 FY25. Under Delorean’s build, own, operate strategy, the Company expects to see substantial value unlocked, particularly upon completion of SA1 construction through to operation at full capacity, expected in Q3 FY26. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 16 Directors’ Report (continued) Operating and Financial Review (continued) Delorean Infrastructure Division (continued) Image 5 & 6: SA1 Salisbury Bioenergy Plant Render VIC1 Stanhope Bioenergy Plant Project Background Location: Stanhope, Victoria In Stage 1, this facility will process 54,000TPA of organic waste. It will generate 120 TJs of biomethane per annum and contribute to emissions reduction of 69,400tCO2e/annum. This is equivalent to powering 3,850 homes with green energy every year. Project Update Tanarra facility is flexible to enable Delorean to progress the construction of its second shovel ready project VIC1 (90% Delorean-owned) in Stanhope, Victoria in parallel to SA1. The project is currently shovel ready for full construction pending project finance. Image 7 & 8: VIC1 bioenergy plant render DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 17 Directors’ Report (continued) Operating and Financial Review (continued) Delorean Infrastructure Division (continued) Brickworks / NSW1 Bioenergy Plant Project Background Brickworks Building Products (ASX: BKW) and Delorean have signed a landmark collaboration agreement to build and operate bioenergy facilities that will be co-located at Brickworks’ brick manufacturing sites. The completed facilities will convert organic waste to green gas and electricity for use in Brickworks’ operations. The collaboration has commenced with Brickworks’ Horsley Park brick manufacturing site in NSW, and if successful, there is the potential for the model to be rolled out on a national basis. Project Update In FY24, Delorean continued the collaborative development of the NSW1 BOO bioenergy project under its agreements with Brickworks, with this project reaching the next stage of development. The project is expected to progress to Financial Investment Decision, subject to normal investment and funding parameters, with construction expected to commence in FY25. Image 9 &10: NSW1 Brickworks Bioenergy Plant Render QLD1 Bioenergy Plant Project Background At full capacity, this site will process approximately 130,000TPA of organic waste with the primary energy output being either biomethane or green electricity. The facility is likely to be developed with a staged approach, with Stage 1 seeing 70,000 tonnes per annum of waste accepted. This is equivalent to powering 9,000 homes with green energy every year (based on full capacity). DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 18 Directors’ Report (continued) Operating and Financial Review (continued) Delorean Infrastructure Division (continued) Project Update Delorean was active in the development of its QLD1 project and successfully secured $5m in funding from the Queensland Government towards its construction. This funding, announced on 28 February 2024, is subject to planning approvals and FID expected in FY25. Image 11 & 12: QLD1 Bioenergy Plant Render Delorean Energy Retail Division FY24 FY23 $ Revenue EBITDA 80,489 1,227,528 $ 15,730,421 (526,662) Energy Retail discontinued substantially all its operation in December 2022 but retained all of its existing energy retail licenses in WA and the Eastern States to underpin its bioenergy infrastructure asset pipeline. Overview In FY24, Delorean successfully secured $1.3m of earnings in execution of its trading strategy on Large Scale Generation Certificates relating to the Company’s energy retail division. This strategy is set to continue into FY25. Delorean’s Energy Retail Division is preparing for a strategic scale up of its retail operations as Delorean’s Infrastructure assets come onstream. Delorean intends to retain its WA and National retail electricity and Victorian Gas licenses on an ongoing basis in support of the Company’s rollout of bioenergy infrastructure across Australia. DELOREAN CORPORATION LIMITED | ANNUAL REPORT 2024 19 Directors’ Report (continued) Operating and Financial Review (continued) ESG Strategy Delorean remains proud to be advancing its commitment to sustainability. In Q2 FY24, Delorean published its second annual ESG Report and is actively preparing for the release of its third report in Q2 FY25. Delorean’s ESG report provides stakeholders with a comprehensive analysis of the Group’s Environmental, Social and Governance (ESG) performance, highlighting key sustainability milestones achieved during the Financial Year. Additionally, it offers an update on the Company’s continued progress towards future sustainability goals. Guided by our purpose of “Shaping a cleaner future”, our impact framework is centered on our contribution to the United Nations Sustainable Development Goals. Delorean focuses its efforts on six key pillars that are relevant to our business and stakeholders, where we believe we can have th