Presentation of Results Grupa Azoty st March 2013

Transcription

1 Presentation of Results Grupa Azoty st March 213

2 Grupa Azoty 212 vs 211 in Numbers Revenue Net profit Equity 5.3 billion PLN 7.1 billion PLN.5 billion PLN.3 billion PLN 3.2 billion PLN 3.5 billion PLN Average employment * Grupa Azoty Dominant company compared to 211 * as at 31 December 212 2

3 Consequent Implementation of Grupa Azoty Strategy for the Years Grupa Azoty consistently implements the Strategy and the directions of development presented there, inter alia: Growth of value for shareholders (growth of the share quotation by 45% from the publication of the Strategy 1 ) Considerable growth of the scale of operations, especially in the production of fertilizers and caprolactam Expanding the fertilizer products portfolio by liquid and specialty fertilizers To make the maxium use of the considerable operations scale in the Group the consolidation process with ZA Puławy is being carried out The Strategy implementation enriched by the opportunities resulting from the consolidation The Group also continues the activities aimed at the improvement of the competitive position and the compensation of the lack of resources advantage Reduction of the production costs through the modernization of the main production chains (e.g. reduction of energy consumption) Production chains lengthening (specialty fertilizers, compounds) Capital ties and long-term contracts with the suppliers of selected raw materials (e.g. sulphur) Growth of the effectiveness in terms of technological solutions due to technology transfer in the Group (inter alia: transfer of phenol technologies as well as urea and ammonia technology) 1. Growth of closing quotations of shares in Azoty Tarnów between 13th June 212 and 18th March 213 3

4 Consolidation Process with Zakłady Azotowe Puławy Has Started the Synergies Quantification as well as the Work on the Management Model of the Group are in Progress The consolidation project inauguration on 21st February in Tarnów Appointed the Consolidation Committee and 14 working teams 14 managers and specialists involved in the work The consolidation project is supported by The Boston Consulting Group Advanced works on the target management model of Grupa Azoty Joint management of the areas with the highest influence on the financial result as well as the biggest synergy potential, including: Commercial activity in the fertilizers unit Purchases of gas and strategic raw materials Logistics and intermediate products flow Furthermore, the implementation of the unified practices and standards and the exchange of know-how Gradual implementation since Q

5 Overview of Key Events in 212 Publication of the Strategy for years 212 to 22 Shareholding structure Other shareholders 28,78% Acquisition of shares in ZA Puławy S.A. State Treasury 45,13% Public Tender Offer of Norica Holding S.à.r.l Grupa Azoty new brand Aviva OFE Aviva BZ WBK 6,45% Norica Holding S.à.r.l. including Cliffstone Holdings Limited 9,68% ING OFE 9,96% 5

6 From the Raw Material to the Product - Grupa Azoty Ilmenite Titanium white Titanium slag Oxygen Natural Gas Nitrogen Ortoxylene Propylene Methanol Benzene Sulphur Sulphuric Acid Production of Synthesis Gas Urea Napthalene Aldehydes Formalin Maleic Anhydride Phenol Oleum Ammonia UAN Phosphorites Phtalic Anhydride OXO Alcohols Trioxane C-none Mixed Acid Nitric Acid Phosphoric Acid Plasticizers POM Caprolactam Dolomite Stone AS NP Fertilizers NPK / PK Fertilizers PA 6 Ammonium Sulphate CAN Potassium Salt Melamine Compounded Polymers ASN 6

7 Consolidation with ZA Puławy in a Nutshell Schedule Effect Stage 1 13th July 212 Public Tender Offer for 32% shares in ZA Puławy 14th November 212 Agreement on Consolidation with ZA Puławy Stage 2 16th January 213 Issue of D Series Shares in Azoty Tarnów 18th January 213 The European Commission s approval of the concentration Stage 3 19th Februry 213 Follow-up Public Tender Offer for shares in ZA Puławy Acquisition of shares in ZA Puławy, representing 1.3% of the Company s share capital Defining principles of cooperation within the consolidation process of the Capital Group Acquisition of shares in ZA Puławy, representing 73.4% of the Company s share capital, as a result of shares swap In total: 83.7% in ZAP share capital Condition necessary to continue the consolidation process Public Tender Offer for shares in ZA Puławy, representing 16.3% of the Company s share capital Plan: 1% in ZAP share capital 7

8 Other Important Events Placing a binding offer for purchasing 85% shares in Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A. (sulphur mine) in Grzybów, Poland. Quitting the privatisation process of Bałtycka Baza Masowa in Gdynia, Poland. Starting up a new Hydrogen Generation Plant. Increasing the consumption of natural gas from local sources. Organisational changes at Azoty Tarnów adapting the Company to the requirements of modern managing a large capital group. Continuing the consolidation of Grupa Azoty PKCh Sp. z o.o. Continuing the process of selling subsidiaries belonging to Grupa Azoty ZAK S.A. 8

9 The Activities Appreciated by the Market Selected Awards and Ratings Azoty Tarnów 1th position in the rating of Puls Biznesu daily The WSE Company of the Year 212 Jerzy Marciniak awarded with the title of the Chairman of the Year 212 by Parkiet the WSE daily source: Puls Biznesu The title of The One Who Changes Polish Industry Shares in Azoty Tarnów in the MSCI Indexes Constant presence in the Respect Index Website of Azoty Tarnów in the second stage of The Issuer s Golden Website contest 9

10 Grupa Azoty Capital Group Core business Azoty Tarnów Plastics: PA6, POM; Nitrogen Fertilizers: CAN, ASN, AS GK Puławy Compound Fertilizers:NPK, NP, K; Nitrogen Fertilizers: AN, UAN, AS, Urea; Melamine, Caprolactam ZCh Police S.A. Grupa Azoty ZAK S.A. ATT Polymers GmbH Compound Fertilizers: NPK, NP; Nitrogen Fertilizers: NS, Urea; Pigments: Titanium White Nitrogen Fertilizers: AN, CAN, Urea; OXO Alcohols; Plasticizers Engineering Plastics: PA6 Maintenance Logistics Grupa Azoty PKCH Sp. z o.o. Grupa Azoty Koltar Sp. z o.o. Services relating to industrial processes and projects Railway transportation

11 Core Business ZCH Police Urea NPK, NP, NS TiO 2 ATT Polymers PA 6 BBM Terminal Fosfory NPK, P Navitrans logistics ZA Puławy AN, RSM Urea Melamine CPL Logistics Production ZAK AN, CAN Urea OXO Alcohols Plasticizers Adipol NPK, N, P, K Azoty Tarnów AN,CAN ASN, UAN CPL,PA 6, POM Compounding 11

12 Grupa Azoty is an Important Producer in the Region Fertilizers Plastics, OXO, Pigments, No. 1 in compound Melamine fertilizers¹ No. 1 in Polyamide No. 1 in mineral fertilizers² No. 1 in OXO Alcohols No. 1 in fertilizers containing and Plasticizers sulphur No. 1 in Titanium White No. 1 in nitrogen fertilizers No. 1 in Melamine Fertilizers No. 3 in compound fertilizers No. 2 in mineral fertilizers Plastics, OXO, Melamine No. 4 in Plasticizers No. 7 in OXO Alcohols No. 5 in Polyamide 6³ No. 2 in Melamine 213 Notes: ¹ Compound fertilizers in total (AP, NPK, PK); ² Compound fertilizers + nitrogen fertilizers; ³ Among integrated producers; 12

13 Strong Position in the Target Markets Almost 9% of the revenue is generated by sales to EU countries North America.4% -.1% European Union * 38% Non-EU countries 3% -3.3% Asia 3% -1.8% -1.6% Poland 51% South America 4% +2% Africa 2% -1% +3% * Without Poland 13

14 Azoty Tarnów on the WSE Historical maximum of the quotation: PLN February213 14

15 Summary of the Year 212 Market and business factors and their influence on the 212 results Decline in sales and prices, mainly in the segments of plastics, oxo and compound fertilizers economic slowdown Increase of prices of strategic raw materials and profitability decline, mainly in the segments of plastics, OXO and pigments Weakening of the EUR/PLN exchange rate in the 2nd half of the year unfavourable parameter in measuring and achieving positive foreign exchange exposure (EUR) in the Group Continuing the activities aiming at building a strong fertilizer and chemical Group Revenue: 7 99 bn PLN, +33 % in relation to 211 (by virtue of full covering results of ZCh Police in 212) EBITDA: 611 m PLN, -21%; Net result: 315 m PLN, -37% Cash: 243 m PLN, -1%, including cash from operating activities: 544 m PLN, +2% Increase of capitalization of Azoty Tarnów by over 7% from the date of public tender offer for shares in Azoty Tarnów announced by Acron 15

16 Macroeconomic Environment of 212 Financial parameters strengthening EUR against PLN in the comparable period of time by 1.6% strengthening USD against PLN in the comparable period of time by 9.9% WIBOR 1M interest rate average annual growth by.48 percentage point GDP growth by 2% against 4.3% in 211 average annual CPI amounted to 3.7% against 4.3% in 211 average annual PPI amounted to 3.3% against 7.6% in 211 5, 4,5 4, 3,5 3, 2,5 Daily quotations, monthly interest rates PLN/USD PLN/EUR Interest rates 6,% 5,5% 5,% 4,5% 4,% 2, Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 3,5% 16 16

17 Grupa Azoty Financial Data m PLN Change y/y 4Q 211 1Q 212 2Q 212 3Q 212 4Q 212 Total sales revenue EBIT EBITDA Net profit Structure of the consolidated revenue of the Group for Jan to Dec 212 Azoty Tarnów; GK ZAK; 2 19 GK Police; Others 493 % 1% 2% 3% 4% 5% 6% 7% 8% 9% 1% 17

18 Azoty Tarnów - Financial Data m PLN Change y/y 4Q 1Q 2Q 3Q 4Q Total sales revenue EBIT EBITDA Net profit EBITDA from 211 to increase decrease 2 1 m PLN sales volume other costs other sales price other revenues volume of price of used operating activity used raw materials raw materials

19 Diversified Business Profile Fertilizers Plastics Phosphatic 24% Nitrate 16% Urea 9% Ammonium sulphate 3% Others 6% 59% 7 99 m PLN 16% Polyamide 12% Polytrioxane 1% Caprolactam 2% Others 1% Pigments 6% 4% 15% OXO Titanium white 6% Others.1% Revenue 212 OXO Alcohols 11% Plasticizers 4% Others 1% 19

20 Cash Flow in the Capital Group Cash flow (m PLN) Cash flow from operating activities Cash flow from investment activities Cash flow from financial activities Cash at the end of period increase decrease 2 m PLN Cash at the beginning of period Profit after tax Depreciation Balance of loans with service costs Changes in working capital Other item Expanditures on Cash at the end real investments of period 2

21 Finance of Grupa Azoty Assets year to year in million PLN Current assets 68% Stock 14% Other tangible assets 5% Receivables 13% Change Current assets % Tangible assets % Inclusive of cash and cash equivalents % Total assets % Liabilities year to year in million PLN Net debt 329 Equity 65% Loans and borrowings 9% Other liabilities 26% Change Equity % Liabillities % Inclusive of loans and borrowings % Others % Total liabilities % 21

22 Ratio Analysis * Ratio Profitability ratios EBIT (%) EBITDA (%) ROCE ROE Liquidity ratio Liquidity ratio I Debt ratios Debt ratio(%) Net debt (million PLN) Net debt/ EBITDA (%) * Capital Group 22 22

23 Main Ratios since IPO in 28 Annually * Revenue Net profit million PLN EBITDA Net debt EBITDA * For the Capital Group 23

24 Main Ratios since IPO in 28 - Quarterly * Revenue Net profit Mln PLN EBITDA Net debt EBITDA * Capital Group 24

25 million PLN millions PLN Segments - Revenue 212 Q % Others % Others Pigments 1 5 Pigments 4 OXO OXO Plastics 5 Plastics 1 Fertilizers Fertilizers Q 211 4Q

26 Results by Segments 212 million PLN Net profit from sales Profit from sales EBIT EBITDA Fertilizers Plastics OXO Alcohols Pigments Others EBITDA Fertilizers Plastics OXO Pigments Others

27 Results by Segments 4Q 212 million PLN Net profit from sales Profit from sales EBIT EBITDA Fertilizers Plastics OXO Alcohols Pigments Others * EBITDA Q 211 4Q Fertilizers Plastics OXO Pigments Others * Changes in cost attribution at Police (methodology unification in the Group) 27

28 PLN/t EUR/t Market Environment - Fertilizers and Raw Materials * Increase in grain prices by 8.4% (on average) Decline in nitrogen fertilizers by 1.5% (on average) Quotations of AN, AS, CAN, rape and wheat Rape PLN/t Ammonium Nitrate AN EUR/t Calcium Ammonium Nitrate CAN EUR/t * 212 compared to Wheat PLN/t Ammonium Sulphate AS EUR/t 28

29 Market Environment - Phosphatic Fertilizers and Raw Materials * Increase in ammonia prices by 5.6% (on average) Increase in phosphorite prices by 2% (on average) Decline in phosphatic fertilizers prices by 7.5% (on average) 7 Quotations of NPK, DAP, phosphorite and ammonia NPK USD/t DAP USD/t Ammonia USD/t Phosphorite USD/t *212 compared to

30 Fertilizers Segment million PLN Change y/y Total sales revenue EBIT EBITDA Segment revenue 212 Others Ammonia Urea % participation in sales % participation in EBITDA NS Nitrate 1 NP 59% 5 NPK 69% million PLN 3

31 Fertilizers Segment million PLN 4Q 211 4Q 212 Change y/y Total sales revenue EBIT EBITDA Segment revenue 4Q 212 Others Ammonia Urea % participation in sales % participation in EBITDA 5 4 NS Nitrate 3 32% 2 NP 59% 1 NPK million PLN

32 Market Environment Organic Products and Plastics* Increase in benzene and phenol prices by 14% (on average) Decline in caprolactam prices by 8% (on average) Decline in polyamide prices by 7% (on average) Quotations of benzene, CPL and PA Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Benzene EUR/t Caprolactam EUR/t PA6 EUR/t * 212 compared to

33 Plastics Segment million PLN Change y/y Total sales revenue EBIT EBITDA Segment revenue 212 Others Cyclohexanone % participation in sales % participation in EBITDA 6 4 POM Caprolactam 16% 13% 2 Polyamide 7% mln PLN 33

34 Plastics Segment million PLN 4Q 211 4Q 212 Change y/y Total sales revenue EBIT EBITDA 7-6 % participation in sales 15% Segment revenue 4Q 212 Others Cyclohexanone POM Caprolactam Polyamide million PLN 34

35 Market Environment - OXO* Decline in propylene prices by.7% (on average) Decline in OXO alcohols prices by.5% (on average) Decline in plasticizers prices by.5% (on average) Quotations of DEHP, 2-EH, propylene Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 * 212 compared to 211 DEHP EUR/t 2-EH EUR/t Propylene EUR/t 35 35

36 OXO Segment million PLN Change y/y Total sales revenue EBIT EBITDA Segment revenue 212 Others Plasticizers 6 % participation in sales % participation in EBITDA 4 OXO Alcohols 15% 11% 2 million PLN

37 OXO Segment million PLN 4Q 211 4Q 212 Change y/y Total sales revenue EBIT EBITDA Segment revenue 4Q 212 Others Plasticizers % participation in sales % participation in EBITDA 1 OXO Alcohols 18% 21% 5 % million PLN

38 Market Environment Titanium White and Ilmenite* Increase in titanium white prices by 12% (on average) Increase in ilmenite prices by 77% (on average) Quotations of titanium white and ilmenite Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec * 212 compared to 211 Titanium white Ilmenite 38 38

39 Pigments Segment million PLN Change y/y Total sales revenue EBIT EBITDA Segment revenue 212 Others % participation in sales % participation in EBITDA 2 15 Titanium white 6% % 7% 1 5 million PLN 39

40 Pigments Segment million PLN 4Q 211 4Q 212 Change y/y Total sales revenue EBIT 9-23 EBITDA Segment revenue 4Q 212 Others % participation in sales 4% Titanium white 1 million PLN 4

41 Business pro forma Purchase of Main Raw Materials * Grupa Azoty Capital Group Natural gas constitutes 31% of raw material purchases Petroleum products constitute 26% of raw material purchases Propylene 14% 211 ** Natural gas 27% Phosphorites 12% Others 14% Potassium salt 11% Phenol 8% Coal 6% Electricity 8% * 1% purchase of main raw materials ** Grupa Azoty Capital Group as at 31st December 212 Propylene 14% Natural gas 31% 212 Others 13% Phosphorites 11% Potassium salt 1% Phenol 8% Coal 6% Electricity 7% 41 wersja robocza

42 Investments 213 * Fertilizers Segment Others Plastics Segment m PLN Pigments Segment OXO Segment * Without ZA Puławy 42

43 Disclaimer The information contained herein has been prepared by Zakłady Azotowe w Tarnowie-Mościcach S.A. ( the Company ) solely for the use at an investor presentation on 21st March 213 ( the Presentation ). By attending the meeting where this Presentation is made or by reading the Presentation slides, you agree to be bound by the following limitations and stipulations. This Presentation does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire any securities of the Company or any member of its group ( the Group ) or Zakłady Azotowe Puławy S.A. ( ZAP ). Nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities of the Company or any member of its Group or ZAP, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment or investment decision referring to securities of the Company, any member of its Group or ZAP. This Presentation does not constitute a recommendation regarding any securities of the Company, any members of its Group or ZAP. The only legally binding document on the Tender Offer to subscribe for the sale of shares in ZAP, authorising to exercise 16.3% votes at the General Meeting of ZAP ( the Tender Offer ) is the content of the Tender Offer, announced on 19th February 213 by the Management Board (as amended) through UniCredit CAIB Poland S.A. with a registered office in Warsaw, Poland as well as Powszechna Kasa Oszczędności Bank Polski Spółka Akcyjna Oddział - Dom Maklerski (Brokerage House) PKO Banku Polskiego w Warszawie, pursuant to the requirements of the Act of 29th July 25 on Public Offering and the Terms and Conditions of Admitting Financial Instruments to an Organised Trading System and on Public Companies (consolidated text: Polish Journal of Laws of 29 no. 185, item 1439) and the Ordinance of the Minister of Finance of 19th October 25 on Specimen Tender Offers for the Sale or Exchange of Shares of a Public Company, Detailed Means of their Announcement and the Terms and Conditions of Purchasing Shares under such Tender Offers (Polish Journal of Laws of 25, no. 27, item 1729 as amended). 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