FY 2015 RESULTS PRESENTATION. March 11th 2016

Transcription

1 FY 215 RESULTS PRESENTATION March 11th 216

2 MANAGEMENT BOARD OF GRUPA AZOTY S.A. Mariusz Bober, President of the Management Board Management, Strategy owner's supervision Audit, risk, HR Agro Business Centre Communication and CSR Witold Szczypiński, Vice-President of the Management Board, Director General Plastics Business Centre Strategic feedstock procurement Production integration Strategy and development Andrzej Skolmowski Vice-President of the Management Board Finance, planning and controlling IT Feedstock supply integration and logistics Investor relations Artur Kopeć, Member of the Management Board Investments Social dialogue Technical safety Environmental protection 2

3 Agenda Page Overview of Grupa Azoty 4 Market overview 11 Grupa Azoty Group 18 Grupa Azoty PUŁAWY Group 27 Grupa Azoty POLICE Group 35 Grupa Azoty KĘDZIERZYN Group 46 Appendix 1 Parent 52 3

4 OVERVIEW OF GRUPA AZOTY

5 FINANCIAL HIGHLIGHTS REVENUE 1,24 EBITDA 1,315 NET PROFIT 692 EPS PERFORMANCE DRIVERS Higher production and sales of nitrogen and NPK fertilizers Favourable trends in compound fertilizer prices Diversified procurement Falling prices of energy (gas, coal) Higher benzene polyamide spread Stronger USD/PLN exchange rate AZOTY PRO Operational Excellence Programme 6.14 (PLN) 215 CONSOLIDATED REVENUE STRUCTURE 1,359 1,747 2,545 3, % 1% Grupa Azoty S.A. Grupa Azoty ZAK Group Grupa Azoty POLICE Group Grupa Azoty PUŁAWY Group Other OVERVIEW OF GRUPA AZOTY 5

6 KEY DEVELOPMENTS LOCAL LEADER WITH GLOBAL PRESENCE IMPLEMENTATION OF STRATEGIC INVESTMENT PROJECTS GROUP VALUE GROWTH DELIVERY OF THE AZOTY PRO PROGRAMME AGREEMENTS WITH A BANK CONSORTIUM FOR THE FINANCING OF CORPORATE NEEDS DIAMONDS OF THE POLISH CHEMICAL INDUSTRY AWARD IN 'WE CHANGE POLISH INDUSTRY UNPRECEDENTED INVESTMENT PROJECTS' 32ND RANK AMONG ICIS TOP4 POWER PLAYERS VALUE CREATION IN CHEMICALS 215-5TH RANK GRUPA AZOTY ON BOARDS OF IFA AND FE GRUPA AZOTY IN FTSE EMERGING MARKETS OVERVIEW OF GRUPA AZOTY 6

7 PIPELINE OF STRATEGIC INVESTMENT PROJECTS PLN 7bn 68 investment projects GRUPA AZOTY POLICE Propylene production plant ü PLN 1.7bn (219) Upgrade of the ammonia unit ü PLN 156m (by 216) Flue gas purification unit and upgrade of the EC II CHP plant ü PLN 164m (by 216) GRUPA AZOTY PUŁAWY Puławy Power Plant ü PLN 1,125m (219) Extension and upgrade of the nitric acid unit ü PLN 695m (221) Nitrate mechanical granulation plant ü two lines PLN 385m (line 1 by 218, line 2 by 22) GRUPA AZOTY KĘDZIERZYN CHP Plant ü PLN 6m (219) UAN production unit ü PLN 29.5m (215) GRUPA AZOTY S.A. Polyamide plant ü PLN 32m (216) Mineral fertilizer granulation plant ü PLN 14m (216) OVERVIEW OF GRUPA AZOTY 7

8 ORGANIC 215 CAPEX GROWTH AND 216 BUDGET CAPEX BUDGET PLN 7bn 68 CAPEX PROJECTS CORPORATE PROJECTS FERTILIZERS ENERGY PLASTICS OXOPLASTS MELAMINE PIGMENTS 32 % 3 % 19 % 11 % 4 % 2 % 2 % 215 CAPEX (PLN ') BUSINESS DEVELOPMENT INVESTMENTS 487,228 BUSINESS MAINTENANCE INVESTMENTS MANDATORY INVESTMENTS 271,289 88,165 TOTAL* PLN 96,79, 216 CAPEX PLN 2bn PURCHASE OF FINISHED GOODS 6,18 * excl. components and upgrades OVERVIEW OF GRUPA AZOTY 8

9 EFFECTS OF AZOTY PRO IN 215 ü 4 employees involved in Azoty PRO ü 139 separate Azoty PRO projects ü PLN 368m in EBITDA savings driven by Azoty PRO in 215 ü 5% improvement in 215 performance vs plan OVERVIEW OF GRUPA AZOTY 9

10 KEY COMPANY DEVELOPMENTS IN 215 GRUPA AZOTY S.A. GRUPA AZOTY PUŁAWY ü Execution of agreements with a bank consortium, EBRD and EIB for the financing of corporate needs ü Launch of construction of the new Mechanical Fertilizer Granulation Plant ü Setting the groundbreaking plaque for the New Polyamide 6 Production Plant ü Grupa Azoty chosen the Best Investor of 215 at the Tarnów Investment Forum ü Golden Website Award in the 8th edition of the programme ü ü ü ü ü Execution of long-term contracts for sale of melamine and urea Implementation of the capex plan (New Fertilizer Complex, nitric acid unit, ammonium nitrate granulation plant, Puławy Power Plant) Disposal of non-core subsidiaries Launch of production of horticultural and gardening fertilizers (under the WOW name) by Agrochem Sp z o.o. Publication of a report entitled Poland as an Attractive Food Producer and Food Supplier GRUPA AZOTY POLICE ü More than twofold increase in EBIT and net profit ü More than 4% increase in capital expenditure ü ROCE at 14% (in Grupa Azoty strategy, target ROCE of 14% by 22) ü Launch of the PDH propylene production unit with infrastructure project: Establishment of PDH Polska S.A. Completion of stage 1 (Basic Engineering) Securing initial financing commitments Launch of tender procedure for Front-End Engineering Design GRUPA AZOTY KĘDZIERZYN ü Launch of new plasticizer production unit based on proprietary technology ü Completion of successive milestones of the New CHP Plant project ü Upgrade and capacity increase of ammonia production ü Launch of RSM liquid fertilizer production unit with logistics base ü Diamond of the Polish Chemical Industry in the Innovation Leader of the Year category ü Adoption of the Growth Strategy of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. for and until 225 OVERVIEW OF GRUPA AZOTY 1

11 MARKET OVERVIEW

12 STRONG POSITION IN TARGET MARKETS 9% of revenue derived from sales to EU markets North America.2% +.1% European Union 1 33% -1% Other Europe 1% -1% Asia 5% -.1% Poland 56% +3% South America 3% +.1% Jan Dec 214 Africa 2% +.4% Jan Dec Excluding Poland GRUPA AZOTY MARKET OVERVIEW 12 12

13 GEOGRAPHICAL STRUCTURE OF SEGMENTS Grupa Azoty's products are sold and used worldwide European Union 1 Other Europe Asia Poland North America 19% 1% 7% 33% 45% 26% 51% 21% 22% 11% 87% 4% 3% 2% 16% Africa 2% 75% South America 4% 84% 96% Agro Fertilizers Plastics Chemicals Energy Other Activities 1 Excluding Poland GRUPA AZOTY MARKET OVERVIEW 13 13

14 MARKET OVERVIEW FERTILIZERS PLASTICS CHEMICALS PROSPECTS Low prices of agricultural produce are eroding farmers' incomes, although direct payments are mitigating this effect. However, situation on the agricultural market may affect sales of agricultural production inputs. Fertilizer consumption in Poland is expected to stay flat. Prices will be affected by prices of energy and grains, and spending will be mostly on nitrogen fertilizers. Due to oversupply, urea prices may hover around the annual average of USD per tonne. Market prices of compound fertilizers (NPK, DAP) will be driven by expected weak demand from India, USA and Brazil. Expected significant decline in prices of raw materials used in fertilizer production (ammonia, sulfur). 215 PRICE TRENDS 1.% -.6% -21.8% -14.3% -5.6% -3.9% RAW MATERIALS 2.5% AN EUR/t CAN Ammonia Urea DAP NPK AS USD/t GRUPA AZOTY MARKET OVERVIEW 14

15 MARKET OVERVIEW FERTILIZERS PLASTICS PROSPECTS Prices of plastics will follow prices of crude oil (through benzene and phenol). " GDP growth expected in the EU and market climate in the automotive industry may moderately boost plastic consumption figures. Currently, the segment is expected to grow by 1%-2% y/y, especially in H Long-term market outlook for PA6 producers is good, given the considerable growth potential driven by product chain extension 215 PRICE TRENDS CHEMICALS -15.1% -17.4% -23.1% -36.2% RAW MATERIALS EUR/t CPL PA6 Benzene Phenol GRUPA AZOTY MARKET OVERVIEW 15

16 MARKET OVERVIEW FERTILIZERS PROSPECTS Prices of alcohols and plasticizers may decline in keeping with the falling prices of propylene, which may result in cautious procurement policy by customers for OXO alcohols (optimisation of stock levels). In the long term, annual growth in demand for 2-EH in Europe is expected to reach 2.9%, while demand for DOTP will grow by 6.2%. PLASTICS Average melamine prices are expected to stay flat on 215. Demand for technical grade urea is expected to remain stable, with the price correlated with urea prices. CHEMICALS 215 PRICE TRENDS -2.5% -8.9% -24.5% 1.4% RAW MATERIALS 2-EH DOTP Propylene Melamine EUR/t GRUPA AZOTY MARKET OVERVIEW 16

17 MARKET OVERVIEW FERTILIZERS PLASTICS PROSPECTS Gas prices are estimated at EUR 12.3/MWh in summer months of 216, EUR 15.3/ MWh at the end of 216/beginning of 217, and EUR 14.5/MWh in 217. According to forecasts by IHS Energy, Brent crude price will hover around USD 39/bbl in 216. Expected growth trend for approx. USD 6/bbl. Sulfur prices are expected to decline by USD 1-25/t, below the 215 average. Oversupply on the global coal market is expected to persist into 218 or longer. ARA CIF average prices are forecast to reach USD 52 per tonne of coal in 216 and USD 54 per tonne in 217. CHEMICALS GAS PRICES (EUR/MWh) 3 25 RAW MATERIALS 2 15 Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 EUR/MWh PGNiG tariff TTF DA net of transmission costs GRUPA AZOTY MARKET OVERVIEW 17

18 GRUPA AZOTY GROUP

19 GRUPA AZOTY GROUP: KEY FINANCIALS REVENUE 2,556 2,839 2,281 2,41 2,53 9,898 1,24 Q4 214 Q1 215 Q2 215 Q3 215 Q % EBITDA EBITDA (adjusted)* 5.% EBITDA MARGIN % % % ,315 1,359 Q4 214 Q1 215 Q2 215 Q3 215 Q NET PROFIT NET PROFIT(adjusted)* % 6.7% 3.4% 6.1% NET MARGIN.6% Q4 214 Q1 215 Q2 215 Q3 215 Q *Adjusted for impairment loss on the phthalic anhydride unit recognised in 214 and for impairment loss on the benzene derived c-non production unit, fat processing plant, and carbon disulfide plant in 215. GRUPA AZOTY GROUP 19

20 GRUPA AZOTY GROUP: EBITDA KEY DRIVERS positive effect on EBITDA negative effect on EBITDA ,315 1, lower selling prices of key products higher sales volume fall in prices of petroleum products and energy carriers GRUPA AZOTY GROUP 2

21 GRUPA AZOTY GROUP: PERFORMANCE BY SEGMENT SEGMENT REVENUE EBITDA REVENUE EBITDA Q4 214 Q4 215 Q4 214 Q Agro Fertilizers 1,514 1, ,58 6, Plastics ,46 1, Chemicals ,56 2, Energy Other Activities CHANGE IN EBITDA Q4 214 VS Q % REVENUE Q4 215 Plastics 11% 7 2-6% -17% 136% -67% Chemicals 22% -3 Agro Fertilizers 61% -8 Agro Fertilizers Plastics Chemicals Energy Other Activities Other Activities 3% Energy 2% GRUPA AZOTY GROUP 21

22 GRUPA AZOTY GROUP: AGRO FERTILIZERS Q4 214 Q CHANGE VOLUMES Segment revenue, including: 1,514 1,536 5,58 6,58 9% Nitrogen fertilizers and ammonia Compound fertilizers 983 1,12 3,699 3,84 3% ,477 1,925 3% EBITDA % EBITDA margin 9% 18% 11% 16% Compound fertilizers Nitrogen fertilizers and ammonia ' tonnes GRAIN PRICES NITROGEN PRODUCT PRICES PLN/t sty.13 mar.13 maj.13 lip.13 wrz.13 lis.13 sty.14 mar.14 maj.14 lip.14 milling wheat / 1kg N in ammonium nitrate at GA PUŁAWY milling wheat (PLN/t) fodder corn (PLN/t) rapeseed (PLN/t) wrz.14 lis.14 sty.15 mar.15 maj.15 lip.15 wrz.15 lis.15 1 USD/t Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Ammonia USD/t Urea USD/t Ammonium sulfate AS USD/t Calcium ammonium nitrate CAN EUR/t 2 EUR/t Source: Ministry of Agriculture and Rural Development. Source: ICIS, Argus FMB, Profercy. GRUPA AZOTY GROUP 22

23 GRUPA AZOTY GROUP: PLASTICS Segment revenue, including: Q4 214 Q CHANGE ,46 1,248-15% Polyamide % VOLUMES Caprolactam % 6 EBITDA % EBITDA margin -5% -6% -2% -1% 4 2 ' tonnes Polyamide Caprolactam PRICES OF BENZENE, PHENOL, CPL, PA EUR/t Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Benzene Liquid caprolactam PA6 Phenol Source: ICIS, TECNON GRUPA AZOTY GROUP 23

24 GRUPA AZOTY GROUP: CHEMICALS Q4 214 Q CHANGE VOLUMES Segment revenue including: ,56 2,32-8% OXO products % Urea (technical grade) % Melamine % Titanium white % EBITDA % EBITDA margin -11% 4% 2% 6% PRICES OF DOTP, 2-EH AND PROPYLENE ' tonnes 4 EUR/t Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Propylene DOTP 2-EH Source: ICIS. GRUPA AZOTY GROUP 24

25 GRUPA AZOTY GROUP: STATEMENT OF FINANCIAL POSITION RATIOS Dec Dec CHANGE Profitability ratios EBIT margin (%) EBITDA margin (%) ROCE (%) ROE (%) Non-current assets Current assets 6,719 7,225 8% 3,229 3,552 1% incl. cash and cash equivalents % TOTAL ASSETS 9,948 1,777 8% Liquidity ratios Current ratio Dec Dec CHANGE Debt ratios Total debt ratio (%) Equity 6,488 7,136 1% Liabilities 3,46 3,641 5% incl. borrowings 986 1,166 18% Net debt Equity-to-debt ratio (%) other financial liabilities TOTAL EQUITY AND LIABILITIES % 9,948 1,777 8% GRUPA AZOTY GROUP 25

26 GRUPA AZOTY GROUP: COST STRUCTURE % DRIVERS Lower cost of raw materials and consumables, attributable to lower prices of energy (gas and coal) and petroleum products (benzene and phenol), accompanied by increased production volumes. Lower depreciation/amortisation, with one contributing factor being an impairment loss recognised on the phthalic anhydride unit in 214. Higher cost of services related to higher sales (transport costs) Higher cost of labour resulting from the Group's financial performance 4 3 6% 4% 4% 5% 5% 4% 2 7% 1 7% 22% PLNm Other Depreciation and amortisation Labour costs Services Raw materials and consumables used Natural gas Potassium chloride Coal Phosphate rock Benzene Other Activities Electricity Propylene Phenol GRUPA AZOTY GROUP 26

27 GRUPA AZOTY PUŁAWY GROUP

28 GRUPA AZOTY PUŁAWY GROUP: KEY FINANCIALS REVENUE 955 1, ,664 3,814 5 Q4 214 Q1 215 Q2 215 Q3 215 Q EBITDA EBITDA (adjusted)* EBITDA MARGIN 9.1% % % 12.6% % Q4 214 Q1215 Q2 215 Q3 215 Q NET PROFIT 16.3% NET PROFIT* (adjusted) NET MARGIN 5.3% % % % Q4 214 Q1215 Q2 215 Q3 215 Q * Adjusted for impairment loss on the fat processing unit (CHORZÓW) and reversal of impairment loss on the Agro segment (PUŁAWY) in 215 Grupa Azoty PUŁAWY 28

29 GRUPA AZOTY PUŁAWY GROUP: PERFORMANCE KEY DRIVERS positive effect on EBITDA negative effect on EBITDA PLNm lower prices of strategic raw materials increased sales volume higher other costs of sales related to higher sales volume lower selling prices *Only the Parent. Grupa Azoty PUŁAWY 29

30 GRUPA AZOTY PUŁAWY GROUP: PERFORMANCE BY SEGMENT SEGMENT REVENUE EBITDA REVENUE EBITDA Q4 214 Q4 215 Q4 214 Q Agro ,33 2, Chemicals ,219 1, Energy Other Activities CHANGE IN EBITDA Q4 214 VS Q % % 2 +56% +8% Agro Chemicals Energy Other Activities Agro 65% REVENUE Q4 215 Other Energy 2% Activities 3% Chemicals 3% Grupa Azoty PUŁAWY 3

31 GRUPA AZOTY PUŁAWY GROUP: AGRO Q4 214 Q change (y/ y) VOLUMES Revenue ,33 2, % & Nitrogen fertilizers ,95 1, % & 2 Phosphate and compound fertilizers Other goods and services Merchandise and materials % & % ( % & EBITDA % & EBITDA margin 16.1% % 25.2% 6.2 pp & ' tonnes Nitrogen fertilizers Phosphate and compound fertilizers Other PRICES OF AN, UAN AND UREA EUR/t Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Ammonium nitrate AN EUR/t UAN EUR/t Urea USD/t USD/t 2 Source: Argus FMB, Profercy Grupa Azoty PUŁAWY 31

32 GRUPA AZOTY PUŁAWY GROUP: CHEMICALS Q4 214 Q CHANGE Revenue ,219 1,158-5.% ( Melamine % & Caprolactam % ( Urea % & Other goods and services % & VOLUMES Merchandise and materials % & 5 EBITDA % & EBITDA margin 5.5% 1.5% 4.7% 1.5% 5.8 pp & ' tonnes Melamine Caprolactam Urea (PULREA, PULNOX for 1% solution equivalent) Other PRICES OF MELAMINE AND CAPROLACTAM EUR/t Source: ICIS. Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Melamine EUR/t Crystalline caprolactam USD/t 1 USD/t GRUPA AZOTY PUŁAWY 32

33 GRUPA AZOTY PUŁAWY GROUP: STATEMENT OF FINANCIAL POSITION RATIOS Dec Dec CHANGE Profitability ratios EBIT margin (%) EBITDA margin (%) ROCE (%) ROE (%) Non-current assets Current assets 2,145 2, % & 1,398 1, % & incl. cash and cash equivalents % & TOTAL ASSETS 3,543 3, % & Liquidity ratios Current ratio Dec Dec CHANGE Debt ratios Total debt ratio (%) Net debt Debt to equity ratio (%) Equity 2,729 3,4 11.4% & Liabilities % & incl. borrowings % & other financial liabilities TOTAL EQUITY AND LIABILITIES - 3,543 3, % & GRUPA AZOTY PUŁAWY 33

34 GRUPA AZOTY PUŁAWY GROUP: COST STRUCTURE % DRIVERS Lower cost of raw materials used: gas, benzene, coal, mainly due to lower prices % Natural gas 1 9% 9% 58% Electricity Benzene 5 9% Coal PLNm *Only the Parent Other Depreciation and amortisation Employee benefits expense Services Raw materials and consumables used Other Activities GRUPA AZOTY PUŁAWY 34

35 GRUPA AZOTY POLICE GROUP

36 7,% 6,% 5,% 4,% 3,% 2,% 1,%,% 12,% 1,% 8,% 6,% 4,% 2,%,% GRUPA AZOTY POLICE GROUP'S CONSOLIDATED RESULTS 2,742 REVENUE ,412 Q4 214 Q1 215 Q2 215 Q3 215 Q EBITDA EBITDA MARGIN % % % % % % % 293 Q4 214 Q1 215 Q2 215 Q3 215 Q NET PROFIT NET MARGIN 6.8% 8.% 6.1% % % 7 15 Q4 214 Q1 215 Q2 215 Q3 215 Q % % GRUPA AZOTY POLICE GROUP 36

37 GRUPA AZOTY POLICE GROUP: EBITDA KEY DRIVERS positive effect on EBITDA negative effect on EBITDA EBITDA 214 Sales volume Product prices Prices of basic raw materials Selling and distribution expenses, fixed costs Raw material volumes other EBITDA 215 ü ü Consolidation of AFRIG's position in Senegal - higher supply of phosphate rock from own deposits Lower consumption of feedstocks, incl. gas, and failure rates: - consistent pursuit of maintenance and capex projects - change in maintenance work philosophy from reactive to preventive maintenance ü ü ü ü Delivery of Azoty Pro programme Reduced number of fertilizer products stabilisation of production through reduced downtime and longer production cycles Fertilizers Unit driver and crucial component of Grupa Azoty Police's business for the second consecutive year Successfully delivered marketing programme GRUPA AZOTY POLICE GROUP 37

38 GRUPA AZOTY POLICE: PERFORMANCE BY SEGMENT SEGMENT REVENUE EBITDA REVENUE EBITDA Q4 214 Q4 215 Q4 214 Q Fertilizers ,67 2, Pigments Other Activities , CHANGE IN EBITDA Q4 214 VS Q4 215 REVENUE Q EBITDA Fertilizers Pigments Other Activities Fertilizers 9% Pigments 8% Other 2% GRUPA AZOTY POLICE GROUP 38

39 GRUPA AZOTY POLICE: FERTILIZERS Q4 214 Q CHANGE VOLUMES Revenue ,67 2,42 17% & Compound fertilizers ,35 1,679 29% & Urea % ( Ammonia % & Other Activities % ( EBITDA % & EBITDA margin 6% 12% 6% 12% 6% & ' tonnes PRICES OF NPK, DAP, PHOSPHATES, POTASSIUM CHLORIDE Compound fertilizers Urea Ammonia Other Activities NPK DAP Phosphate rock Potassium chloride GRUPA AZOTY POLICE GROUP 39

40 GRUPA AZOTY POLICE: PIGMENTS Q4 214 Q CHANGE Revenue % ( Titanium white % ( 4 3 Volumes Other % EBITDA % ( 2 1 EBITDA margin 4% -5% 1% 1% -9% ( ' tonnes Titanium white Other Activities PRICES OF TITANIUM WHITE, ILMENITE AND TITANIUM SLAG EUR/t USD/t Titanium white Ilmenite Titanium slag GRUPA AZOTY POLICE GROUP 4

41 GRUPA AZOTY POLICE: STATEMENT OF FINANCIAL POSITION RATIOS Dec Dec CHANGE Profitability ratios Non-current assets 1,369 1,525 11% EBIT margin 3% 8% EBITDA margin 7% 11% ROCE 6% 13% ROE 6% 13% Current assets % incl. cash and cash equivalents % TOTAL ASSETS 2,79 2,184 5% Liquidity ratios Current ratio Dec Dec CHANGE Debt ratios Total debt ratio 47% 44% Net debt Equity 1,17 1,228 11% Liabilities % incl. borrowings % Equity-to-debt ratio 114% 128% other financial liabilities TOTAL EQUITY AND LIABILITIES % 2,79 2,184 5% GRUPA AZOTY POLICE GROUP 41

42 GRUPA AZOTY POLICE: COST STRUCTURE % DRIVERS ü Increased production of compound fertilizers ü Lower gas consumption cost following price reduction 1 5 Natural gas 1 23% 32% Phosphate rock 5 5% 2% 2% Potassium chloride Fine coal PLNm Other Depreciation and amortisation Labour costs Services Raw materials and consumables used Other Activities GRUPA AZOTY POLICE GROUP 42

43 PERFORMANCE ON THE STOCK MARKET % % DIVIDENDS PAID PLN/share for 25 (PLN 25.5m) for 212 (PLN 5.3m) for 213 (PLN 23.3m) for 214 (PLN 42m) for 215* (PLN 67.5m) *Management Board's recommendation GRUPA AZOTY POLICE GROUP 43

44 GRUPA AZOTY POLICE'S RESULTS EBITDA EBITDA MARGIN % 1, % 5.% 7.2% 5.5% 7.7% % NET PROFIT NET MARGIN % 1.7% % 1.7% 3.5% 6.2% % EBIT ROCE % % 4.6% 11.2% 4.8% 8.2% 14.3% * Grupa Azoty Zakłady Chemiczne Police S.A. GRUPA AZOTY POLICE GROUP 44

45 CAPITAL EXPENDITURE Capital expenditure Business development Expenditure on property, plant and equipment GRUPA AZOTY POLICE GROUP 45

46 GRUPA AZOTY ZAKŁADY AZOTOWE KĘDZIERZYN S.A.

47 2,% 18,% 16,% 14,% 12,% 1,% 8,% 6,% 4,% 2,%,% GRUPA AZOTY KĘDZIERZYN: KEY FINANCIALS REVENUE ,56 1,816 Q4 214 Q1 215 Q2 215 Q3 215 Q EBITDA 1 Adjusted EBITDA* EBITDA MARGIN % % % 8.1% 15.3% Q4 214 Q1 215 Q2 215 Q3 215 Q NET PROFIT 11.1% 8.6% Adjusted NET PROFIT* NET MARGIN 6.3% % 3.2% * One-off item: impairment loss on phthalic anhydride unit of PLN 4m GRUPA AZOTY KĘDZIERZYN Q4 214 Q1 215 Q2 215 Q3 215 Q

48 GRUPA AZOTY KĘDZIERZYN: PERFORMANCE BY SEGMENT SEGMENT REVENUE EBITDA REVENUE EBITDA Q4 214 Q4 215 Q4 214 Q Fertilizers ,6 1, OXO alcohols Other Activities CHANGE IN EBITDA Q4 214 VS Q4 215 REVENUE Q OXO alcohols 34% Fertilizers 6% -4 Fertilizers OXO alcohols Other Activities Other 6% GRUPA AZOTY KĘDZIERZYN 48

49 GRUPA AZOTY KĘDZIERZYN: STATEMENT OF FINANCIAL POSITION RATIOS Profitability ratios EBIT margin (%) EBITDA margin (%) ROCE (%) ROE (%) Non-current assets Current assets Dec Dec CHANGE 1,36 1,244 2% % incl. cash and cash equivalents % TOTAL ASSETS 1,54 1,728 12% Liquidity ratios Current ratio Debt ratios Total debt ratio (%) Net debt Debt to equity ratio (%) Dec Dec CHANGE Equity 1,59 1,124 6% Liabilities % incl. borrowings % other financial liabilities TOTAL EQUITY AND LIABILITIES 4 4 % 1,54 1,728 12% GRUPA AZOTY KĘDZIERZYN 49

50 DISCLAIMER The information presented below has been prepared by the Grupa Azoty Group (the Group ) solely for the purpose of presentation to investors and market analysts on March 11th 216 (the Presentation ). By participating in the meeting at which the Presentation is presented or by referring to the following Presentation, you agree to the following specific restrictions and disclaimers. This presentation does not constitute or form any part of, and should not be considered as, an offer to sell or as an offer to subscribe for, or as a guarantee to purchase or acquire in other way, any securities of any company of the Group. Neither this Presentation nor any part hereof may form the basis of, or be relied upon in connection with, any subscription for any securities of the Group, or their acquisition. 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52 APPENDIX 1 PARENT

53 KEY RATIOS SINCE IPO 28, QUARTERLY * REVENUE AND NET PROFIT Q1 28 Q2 28 Q3 28 Q4 28 Q1 29 Q2 29 Q3 29 Q4 29 Q1 21 Q2 21 Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 Q4 211 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Q2 213 Q3 213 Q4 213 Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q Revenue Net profit (right axis) EBITDA AND NET DEBT *Grupa Azoty Group Net debt GRUPA AZOTY S.A. 53 EBITDA

54 GRUPA AZOTY S.A.: KEY FINANCIALS REVENUE 1, ,777 Q4 214 Q1 215 Q2 215 Q3 215 Q EBITDA EBITDA (adjusted)* EBITDA MARGIN 1.6% % 4.5%.9% 5 1.1% Q4 214 Q1 215 Q2 215 Q3 215 Q NET PROFIT NET PROFIT** (adjusted) NET MARGIN Q4 214 Q1 215 Q2 215 Q3 215 Q *EBITDA was adjusted for impairment loss on the benzene derived cyclohexanone plant (PLN 11.9m) recognised in Q4 215 **NET PROFIT was adjusted for dividends received (in all reporting periods) and impairment loss on the benzene derived cyclohexanone plant (PLN 9.7m) GRUPA AZOTY S.A. 54

55 GRUPA AZOTY S.A.: RESULTS BY SEGMENT SEGMENT REVENUE EBITDA REVENUE EBITDA Q4 214 Q4 215 Q4 214 Q Fertilizers Plastics Energy Other Activities CHANGE IN EBITDA Q4 214 VS Q4 215 REVENUE Q Plastics 44% Fertilizers Plastics Energy Other Activities Fertilizers 52% Other Activities 2% Energy 2% GRUPA AZOTY S.A. 55

56 GRUPA AZOTY S.A.: FERTILIZERS Q4 214 Q CHANGE VOLUMES Segment revenue including % Nitrogen fertilizers % EBITDA % EBITDA margin 2% 9% 2% 8% ' tonnes Nitrogen fertilizers PRICES OF AMMONIA, AMMONIUM SULFATE AND CALCIUM AMMONIUM NITRATE USD/t Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Ammonia USD/t Ammonium sulfate AS USD/t Calcium ammonium nitrate CAN EUR/t 2 EUR/t Source: Argus FMB, ICIS GRUPA AZOTY S.A. 56

57 GRUPA AZOTY S.A.: PLASTICS Q4 214 Q CHANGE VOLUMES Segment revenue including % Polyamide % Caprolactam % 6 EBITDA % EBITDA margin -2% -9% 2% 2% 4 2 Polyamide Caprolactam PRICES OF BENZENE, PHENOL, CPL, PA EUR/t Q1 214 Q2 214 Q3 214 Q4 214 Q1 215 Q2 215 Q3 215 Q4 215 Benzene Liquid caprolactam PA6 Phenol Source: ICIS, TECNON GRUPA AZOTY S.A. 57

58 GRUPA AZOTY S.A.: COST STRUCTURE % DRIVERS Decline in cost of raw materials and consumables attributable to lower prices of petroleum products (benzene down 38% and phenol down 3%) and energy (natural gas down 1% and coal down 11%) 1 2 Higher cost of services driven by a change in terms of sale (transport costs) PLNm Other Depreciation and amortisation Labour costs Services Raw materials and consumables used 7% 18% 7% 7% 18% 23% 2% Phenol Natural gas Other Activities Ammonia Coal Benzene Caprolactam GRUPA AZOTY S.A. 58

59 STOCK PRICE NEW HIGH 3 12 Growth from Jun 3 28: Growth from Jan 1 215: 522 % 57% 2 5 High (Dec 8 215) Low (Feb 3 29) PLN 113. PLN Jun-8 Dec-8 Jun-9 Dec-9 Jun-1 Dec-1 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Trading volume Price GRUPA AZOTY S.A. 59

60 Contact: Investor Relations Team 6