BMO Global Metals and Mining Conference. February 27, 2018

Transcription

1 BMO Global Metals and Mining Conference February 27, 2018

2 Safe Harbor Statement Safe Harbor Statement under the Private Securities Act of 1995: Statements in this news release that are forward-looking statements are subject to various risks and uncertainties concerning specific factors described in FMC Corporation's 2016 Form 10-K and other SEC filings. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. FMC Corporation does not intend to update this information and disclaims any legal obligation to the contrary. Historical information is not necessarily indicative of future performance. Non-GAAP Financial Terms These slides contain certain non-gaap financial terms which are defined on our website In addition, we have also provided on our website at reconciliations of non-gaap terms to the most directly comparable GAAP term. Amounts in this presentation focus on Adjusted Earnings for all EBIT, EBITDA and EPS references. Although we provide forecasts for adjusted EPS and adjusted cash from operations (both of which are non-gaap financial measures), we are not able to forecast the most directly comparable measures calculated and presented in accordance with GAAP. Certain elements of the composition of the GAAP amounts are not predictable, making it impractical for us to forecast. Such elements include, but are not limited to restructuring, acquisition charges, and discontinued operations and related cash activity. As a result, no GAAP outlook is provided. 2

3 Lithium A Few Basic Tenets 1. The form of lithium matters 2. It s all about the demand 3. Future supply curves are messy 3

4 EV Battery Technology Roadmap Beyond 2020 OEM 1 OEM 2 OEM 3 OEM 4 OEM 5 OEM 6 OEM 7 OEM 8 OEM 9 OEM 10 Technology NMC 532 NMC 622 (carbonate) NMC 622 (hydroxide) NMC 811, NCA (hydroxide) Increasingly Nickel Rich Cathodes *Source: FMC estimates 4

5 Millions of Pure EVs Lithium Demand Outlook Pure EV s by OEM OEM Region OEM Region OEM Region Source: FMC estimates 5

6 Millions of Pure EVs Lithium Demand Outlook Pure EV s by Region 14 12% Market Penetration China % Market Penetration China ROW 2.5% Market Penetration China ROW ROW OEM Region OEM Region OEM Region Source: FMC estimates 6

7 Lithium Demand (kmts of LCEs) Lithium Demand Outlook by Application 1,200 Pure EVs Other Energy Storage Other Applications 1, Source: FMC estimates 7

8 Lithium Demand (kmts of LCEs) Lithium Demand Outlook by Product 1,200 Pure EVs Other Energy Storage Other Applications 1, Other Other LiOH Other LiOH LiOH Source: FMC estimates 8

9 Lithium Demand Outlook vs. Supply 1,200 Pure EVs Other Energy Storage Other Applications 1,000 Lithium Demand (kmts of LCEs) Other Other LiOH Other LiOH LiOH FMC Estimate of Effective Capacity Source: FMC estimates 9

10 200 kmt Estimated Cash Cost Estimated Total 2017 Demand Lithium Supply Outlook 2017 Cost Curve Current Carbonate Market Price Range ($11-14/kg) Brine - Argentina Brine - Chile Brine China / ROW Spodumene Sources 10 Sources: Cost curve FMC estimates; Carbonate price range Benchmark Minerals, SQM, Orocobre

11 335 kmt Estimated Cash Cost Estimated Total 2020 Demand Lithium Supply Outlook 2020 Cost Curve Current Carbonate Market Price Range ($11-14/kg) Brine - Argentina Brine - Chile Brine China / ROW Spodumene Sources Sources: Cost curve FMC estimates; Carbonate price range Benchmark Minerals, SQM, Orocobre 11

12 1,000 kmt Estimated Cash Cost Estimated Total 2025 Demand Lithium Supply Outlook 2025 Cost Curve Current Carbonate Market Price Range ($11-14/kg) Brine - Argentina Brine - Chile Brine China / ROW Spodumene Sources Sources: Cost curve FMC estimates; Carbonate price range Benchmark Minerals, SQM, Orocobre 12

13 FMC Lithium Shift in Product Focus F* $257 million Revenue ~$440 million* $40 million EBITDA ~$190 million* < 17,000 Total LCEs Produced (MT) ~21,000 27% 19% Product Mix 5% Hydroxide Buli & Other Spec Carb. & Chloride 35% 60% 54% *Source: Per guidance, as stated in FMC s February 12, 2018 Outlook Statement. 13

14 FMC Capacity Expansion Timeline CARBONATE CapEx $250 - $300 million $275 - $300 million Capacity (1) (kmt) Capacity (1) (kmt) CapEx $30-$50 million $30-$70 million $10-$40 million HYDROXIDE (1) At year end 14

15 FMC DRIVERS MARKET Lithium Key Drivers for 2018 & Beyond Market Supply / Demand Remains a Positive Demand continues to accelerate; 1 million MT/yr will be required by 2025 (on an LCE basis) Additional investment will be required in both brine and hard rock resources to meet demand Market reliance on high-cost production creates price floor that will persist for several years Higher 2018 Prices / Multi-Year Contracts Majority of 2018 revenue is under multi-year contracts with defined price range for the out-years All product categories realizing higher prices versus 2017 Higher LCE & Hydroxide Production Successful debottlenecking projects increase FMC production to ~ 21,000 MT LCE in 2018 Full year of production at new (sold out) lithium hydroxide plant in China Capital investment to progress lithium hydroxide and lithium carbonate expansions per announced plans 15