Fortescue Ltd · ASX:FMG
Fortescue — Shareholder Meeting (November 2022)
37 slides from Fortescue's shareholder meeting presentation, Nov 22, 2022
Slide 1: Presentation – Annual General Meeting 2022
For personal use only 22 November 2022 PRESENTATION – ANNUAL GENERAL MEETING 2022 Fortescue Metals Group Ltd (Fortescue, ASX: FMG) advises that Executive Chairman, Dr Andrew Forrest AO and Fortescue Future Industries Chief Executive Officer, Mark Hutchinson, are addressing shareholders at the Annual
Slide 2: 2022 Annual General Meeting: We are Fortescue
For personal use only 2022 Annual General Meeting We are Fortescue 22 NOVEMBER 2022 © 2022 FORTESCUE FORTESCUE | 1
Slide 3: Important Notice
Forward Looking For personal use only Important Notice Statements The purpose of this presentation is to provide general information about Fortescue Metals Group Ltd (“Fortescue”), including general information in relation to Fortescue’s wholly owned subsidiary Fortescue Future Industries Pty Ltd an
Slide 4: Dr Andrew Forrest AO, Executive Chairman
For personal use only Dr Andrew Forrest AO Executive Chairman FORTESCUE | 3
Slide 5: Stepping beyond fossil fuels
Stepping beyond fossil fuels For personal use only FORTESCUE | 4
Slide 6: FY22 highlights
FY22 highlights For personal use only 189.0mt US$100/dmt US$10.6bn Record annual shipments Average revenue Underlying EBITDA US$15.91/wmt US$6.2bn US$2.01 Industry leading C1 cost Net profit after tax Earnings per share (A$2.77) FORTESCUE | 5
Slide 7: Q1 FY23 highlights
Q1 FY23 highlights For personal use only 47.5mt US$17.69/wmt Record first quarter Industry leading C1 cost shipments US$87/dmt US$2.8bn Average revenue Net debt FORTESCUE | 6
Slide 8: Iron Bridge first ore in processing plant
Iron Bridge first ore in processing plant For personal use only FORTESCUE | 7
Slide 9: Iron Bridge Magnetite Project
Iron Bridge Magnetite Project For personal use only Strategic investment providing an enhanced product range to meet customer demand US$3.6 – US$3.8bn Capital estimate 67% Fe High grade magnetite concentrate 22mtpa First production in March 2023 quarter FORTESCUE | 8
Slide 10: Exploration
Exploration For personal use only Pilbara Extensive iron ore tenement footprint; focus on programs at Nyidinghu and Mindy South Australia Target generation for copper-gold in WA, NSW and SA; drilling underway in NSW and SA International Drilling programs in Argentina and Kazakhstan; exploration in P
Slide 11: Republic of Gabon
Republic of Gabon For personal use only High grade deposit One of the world’s largest undeveloped high grade hematite deposits Attractive jurisdiction Politically and economically stable with regulatory framework for foreign investment Exploration Convention Joint venture between Fortescue (80%) and
Slide 12: Rare Earth Elements
Rare Earth Elements For personal use only Rare earths Critical to FFI’s projects in manufacturing, renewables and hydrogen Support decarbonisation Demand for permanent magnets for wind turbines and electric vehicles Rapidly growing market Set to bring added value for our shareholders FORTESCUE | 11
Slide 13: COP27
COP27 For personal use only British King and Prime Minister at Buckingham Palace FORTESCUE | 12
Slide 14: Executive bonuses directly linked to emission reduction
Executive bonuses directly linked to emission reduction For personal use only FY30 goals Green energy use FY23 LTIP FY24 LTIP FY25 LTIP FY26 LTIP GROSS CARBON EMISSIONS FY27 LTIP 2022 2023 2024 2025 2026 2027 2028 2029 2030 FORTESCUE | 13
Slide 15: Leading global effort to decarbonise heavy industry
Leading global effort to decarbonise heavy industry For personal use only United Nations General Assembly in New York FORTESCUE | 14
Slide 16: Decarbonisation roadmap
Decarbonisation roadmap For personal use only Scope 1 and 2 emissions GREEN POWER GREEN FLEET GROSS CARBON EMISSIONS DEMAND RESPONSE 2022 2025 2026 2027 2029 2030 Pilbara Energy Connect Zero emission Battery/ammonia Upgrade to plant Electric/hydrogen Chichester Solar Gas Hybrid battery/hydrogen trai
Slide 17: Creating value for shareholders
Creating value for shareholders For personal use only De-risking cost profile Eliminating exposure to fossil fuel price volatility, carbon offsets, future carbon tax US$3 billion Cumulative operating cost savings by 2030, payback of capital by 2034 US$818m per annum Net operating cost savings from 2
Slide 18: Green fleet development
Green fleet development For personal use only Williams Advanced Engineering Critical technology and expertise in high performance battery systems and electrification Liebherr partnership First green haul truck operational at site by 2025 Locomotives World’s first zero emission regenerating battery e
Slide 19: Liebherr partnership
Liebherr partnership For personal use only Liebherr partnership event in Colmar, France FORTESCUE | 18
Slide 20: Safety and unique culture
For personal use only Safety and unique culture Total Recordable Injury Frequency Rate 7.6 1.7 TRIFR 15% 6.0 5.1 4.3 3.7 Total Recordable Injury Improvement compared to 2.9 2.8 2.4 2.0 Frequency Rate at 30 30 September 2021 1.8 September 2022 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FORTESC
Slide 21: Our People
Our People For personal use only Championing diversity and building a workplace that is inclusive of all people >60% 23% 60% Female representation Female employment Increase in number of female on Board of Directors team members since 2020 FORTESCUE | 20
Slide 22: Creating opportunities
Creating opportunities For personal use only Empowering Aboriginal people through training, employment and business development opportunities 15% Aboriginal >A$4 billion 1,100 Employment rate across Pilbara Contracts awarded to Aboriginal Aboriginal people employed operations businesses and joint ve
Slide 23: Challenging the impossible
For personal use only Challenging the President of Ukraine and Fortescue’s Executive Chairman impossible FORTESCUE | 22
Slide 24: Delivering returns to our shareholders
Delivering returns to our For personal use only shareholders FY22 fully franked dividend of A$2.07 per share, representing a 75% payout of NPAT Dividends (A$/share) and payout ratio (%) 4.50 78% 80% 85% 77% 75% 4.00 3.58 75% 3.50 62% 65% 52% 3.00 55% 2.50 38% 45% 36% 2.07 2.00 1.76 35% 1.50 21% 21%
Slide 25: Mr Mark Hutchinson, FFI Chief Executive Officer
For personal use only Mr Mark Hutchinson FFI Chief Executive Officer FORTESCUE | 24
Slide 26: The New York Times wrap
For personal use only Hydrogen produced using 100% renewable energy sources is called green hydrogen. The New York Times wrap FORTESCUE | 25
Slide 27: Delivering energy security
Delivering energy security For personal use only Supplying green energy globally by 2030 FORTESCUE | 26
Slide 28: Kenya Binding Framework Agreement
Kenya Binding Framework Agreement For personal use only Affordable green fertiliser Replace imported polluting fertiliser with affordable green fertiliser supply chain Skilled job creation Strong local industry and skilled job creation Aiming for >1 million tonnes Green hydrogen per year for export
Slide 29: Gibson Island
Gibson Island For personal use only Green conversion Partnering with Incitec Pivot to convert existing production facility to produce green ammonia GH2 production Construction of new ~500MW hydrogen electrolysis facility to produce green hydrogen Final assessment stage Finalising Front End Engineeri
Slide 30: Green Energy Manufacturing Centre
Green Energy Manufacturing Centre For personal use only Gladstone, Queensland Construction of GEM FORTESCUE | 29
Slide 31: A technology company
A technology company For personal use only Technology is the key to scaling up the green hydrogen economy US Technology Hub Potential 10 year partnership with the US Department of Energy (NREL) Gladstone Australia’s first multi-gigawatt-scale electrolyser manufacturing facility FORTESCUE | 30
Slide 32: US Technology Hub
US Technology Hub For personal use only FFI Technology Hub in Colorado, USA FORTESCUE | 31
Slide 33: Green market development
Green market development For personal use only Offtake agreements Progressing across Europe, Asia and North America Partnership with E.ON Aiming to deliver up to 5mtpa of green hydrogen to Europe by 2030 Tree Energy Solutions Development of green hydrogen import facility in Germany Patrick Lammers,
Slide 34: Supporting Fortescue's transition
Supporting Fortescue’s transition For personal use only Green capital Growing international capital to fund green energy projects FFI project finance Separately secured through substantial market demand for green investments FFI capital allocation 10% of NPAT, FY23 anticipated expenditure of US$730
Slide 35: FY23 guidance
FY23 guidance For personal use only 187 – 192mt Iron ore shipments US$18.00 – US$18.75/wmt C1 cost for hematite US$2.7 – US$3.1bn Capital expenditure, excluding FFI Guidance is based on an assumed FY23 average exchange rate of AUD:USD 0.70 FORTESCUE | 34
Slide 36: We are Fortescue
For personal use only We are Safety Integrity Fortescue Family Enthusiasm Empowerment Courage and determination Frugality Generating ideas Stretch targets Humility FORTESCUE | 35
Slide 37: We are Fortescue
For personal use only We are Fortescue fortescue.com FORTESCUE | 36