Does SinterCast have any plans to apply its technology to other materials or to broaden its focus to include alternative products or technologies?


Shareholder, name withheld

Within SinterCast, we have frequently considered the opportunities to extend our technology to applications beyond CGI. However, until recently, we have always decided to apply all of our resources to the development of our CGI technology, customer production, and the development of the CGI market. Our objective has been to focus on one goal and to establish ourselves as the clear market leader.

Although there is still a lot of work and potential left in the development of the CGI market, our core CGI technology has been proven and it is highly respected within the foundry and automotive industries. We have succeeded to make the SinterCast name synonymous with CGI. From this foundation, we believe that we can now allocate some of our human resources toward the development of our thermal analysis technology for other materials.

As mentioned in the 2006 Full Year report published on 14 February, we have begun to evaluate the application of our thermal analysis know-how to the process control and quality control of ductile iron. A first patent has been filed and we hope to begin customer field trials during 2007. As ductile iron is the nearest metallurgical neighbour of CGI, and a demanding material that requires accurate foundry control, it is the logical starting point for the extension of our technology. Our initial discussions with the ductile iron foundry community have been well received and we will continue to work directly with the foundries in our attempt to develop a technology that meets their requirements.

SinterCast’s efforts in the CGI arena have earned widespread respect throughout the industry and have established SinterCast as the technology leader for thermal analysis. We will focus our future growth on our core thermal analysis competence and grow from within. If the intention of the question is to ask if we will ‘jump ship’ and begin to develop or acquire alternative products or technologies, the clear answer is ‘no’. Our CGI technology is successful and the high volume years now lie ahead of us, with production commitments representing almost 1 million Engine Equivalents per year already announced, and another 4 million Engine Equivalents per year under development. For SinterCast, this is precisely the wrong time to jump ship.