Slide 1: Investor Presentation
Investor Presentation xx 29 March 2021 1
Slide 2: Disclaimer
Disclaimer This presentation ("Presentation") has been prepared by OCI N.V. (the "Company"). By accessing and reading the Presentation you agree to be bound by the following limitations: This Presentation does not constitute or form a part of, and should not be construed as, an offer for sale or sub
Slide 3: 2021 is the year of deleveraging, positioning us for strong sustainable growth
2021 is the year of deleveraging, positioning us for strong sustainable growth OCI is a diversified global leader in nitrogen and methanol products providing fertilizers, fuels, and feedstocks to agricultural, transportation and industrial customers Following a period of capital-intensive high growt
Slide 4: Agenda
Agenda H2 OCI’s Unique Favorable volume Capitalizing on Focus on Value Appendix Positioning and Pricing Outlook the Hydrogen Creation and Capital Opportunity Discipline 4
Slide 5: Safety first: commitment to zero injuries
Safety first: commitment to zero injuries OCI is committed to providing a safe and healthy workplace for all employees and stakeholders by implementing the highest international safety standards to avoid any potential risks to people, communities, assets or the environment Conversion intoQ4 FCF2019
Slide 6: Established entrepreneurial track record and history of growth
Established entrepreneurial track record and history of growth Strong investment track record in developing, acquiring and divesting businesses Cement Divestment US expansions Divested cement business to Acquired a mothballed OCI Lafarge at an EV of $15bn Beaumont (2011) Construction Demerger Fertig
Slide 7: Diversified global leader in nitrogen and methanol products
Diversified global leader in nitrogen and methanol products Significant Investments in New Capacity Completed Diversified Product Portfolio State of the Art and Young Asset Base OCI’s Capacity Growth 2008 – 2020 (mtpa) 2020 Production Capacity by Product Youngest asset base relative to global 52% 16
Slide 8: Nitrogen production capacity and commercial footprint
Nitrogen production capacity and commercial footprint Nitrogen Footprint Iowa Fertilizer Company (IFCo) - Iowa, US Egyptian Fertilizer Co (EFC) – Egypt ▪ Production and sales ▪ Acquired: 2008 started April 2017 Product ktpa Product1 ktpa Urea 1,648 Ammonia (net) 195 UAN 1,832 Urea 438 DEF 1,019 Egyp
Slide 9: Methanol production capacity and commercial footprint
Methanol production capacity and commercial footprint United States Global OCI Beaumont (Texas, US) OCI Methanol Marketing Product ktpa ✓ Wholly owned subsidiary marketing OCI’s 3.0Mt of methanol Methanol 1,0041 Ammonia 356 portfolio globally ✓ The distribution platform’s global footprint and distri
Slide 10: Ammonia and methanol are versatile and have a diverse set of end applications
Ammonia and methanol are versatile and have a diverse set of end applications Ammonia: End-Use Applications Examples Methanol: End-Use Applications Examples Ammonia is primarily utilized in fertilizers, but also supports a diverse With its diversity of applications – from paints and plastics, furnit
Slide 11: OCI's existing premium priced sustainable products are underpenetrated, fast growing
OCI’s existing premium priced sustainable products are underpenetrated, fast growing and are key to decarbonizing the road transport sector OCI’s bio-methanol will help decarbonize the transport sector and is key to meeting US, UK and EU renewable fuel targets Feedstocks include: Bio-methanol is a
Slide 12: DEF eliminates NOx from diesel exhaust emissions and improves fuel efficiency
DEF eliminates NOx from diesel exhaust emissions and improves fuel efficiency in SCR equipped engines1 DEF demand is expected to grow by more than 15% per DEF is priced at a premium to urea and is one of OCI’s annum over the medium-term fastest-growing products • Diesel Exhaust Fluid (DEF) is a comb
Slide 13: OCI's strategic footprint will capture the hydrogen potential
OCI’s strategic footprint will capture the hydrogen potential We are uniquely positioned to drive the hydrogen economy through our geographic OCI’s unique advantages presence & product mix Optimal solar/wind resources • One of the largest ammonia and Least Most methanol producers in the world OCI pr
Slide 14: OCI's commitment to a sustainable world
OCI’s commitment to a sustainable world OCI’s contribution to the Driving decarbonization with a focus on sustainable value creation and contributing to the UN SDGs Sustainable Development Goals (SDGs) Environmental Driving Committed to 20% GHG intensity reduction by 2030 and carbon 90% 76% sustai
Slide 15: Agenda
Agenda H2 OCI’s Unique Favorable volume Capitalizing on Focus on Value Appendix Positioning and Pricing Outlook the Hydrogen Creation and Capital Opportunity Discipline 15
Slide 16: Volume growth delivered; price recovery accelerating deleveraging
Volume growth delivered; price recovery accelerating deleveraging Delivering New Capacity Ramp-up Benefit from Competitive Cost Positions Well Positioned for Market Upsides Volume growth in 2020 and 2021 Cash conversion metrics Price recovery o Ramp-up of all new capacities complete as of Q3 o Globa
Slide 17: Following record 2020, healthy step-up in sales volumes expected in 2021
Following record 2020, healthy step-up in sales volumes expected in 2021 Own Produced Volume Sold, Mt Methanol expected to drive volume growth in 2021 Methanol Nitrogen 12.2 Q4 2020: 9.9 ▪ Total own-produced nitrogen product volumes increased 10% YoY, driven by strong growth in all regions ▪ Total o
Slide 18: Favourable outlook for nitrogen fertilizers
Favourable outlook for nitrogen fertilizers Attractive supply-demand fundamentals and Nitrogen prices recover to mid-cycle levels steepening cost curve Urea, CAN and UAN Pricing ($/t) Bull Market Drivers Expected to Support Higher Nitrogen Prices 600 550 CROP PRICES Rising crop prices and corn >$5/b
Slide 19: Global agricultural fundamentals set to remain positive
Global agricultural fundamentals set to remain positive Global crop prices rally setting the tone for a bullish 2021 China doubles corn imports with large purchases from the US 160 Corn Soy Wheat Ukraine USA Laos Myanmar Other +95% 140 Corn + 27% since Jan at $5.53 Soy +17% since Jan at $14.15 24 Ch
Slide 20: Methanol and ammonia prices have rebounded
Methanol and ammonia prices have rebounded Industrial nitrogen markets structurally tighten Methanol prices benefit from demand recovering Global Feedstock Prices 2016-2021F Ammonia prices have room to rise further 700 Spot prices +150% since 800 as high cost producers shutdown with no trough in Jun
Slide 21: Limited new supply additions to support improving prices
Limited new supply additions to support improving prices Urea capacity additions slow relative to 2015-19 Merchant ammonia market expected to significantly tighten Global ammonia capacity additions ex-China ex-urea, Mt Global urea capacity additions ex-China, Mt 4 Capacity additions 24 Capacity addi
Slide 22: Higher costs for marginal producers supportive of prices
Higher costs for marginal producers supportive of prices Global Feedstock Prices 2016-2021F, $/MMBtu Cash Costs per ton of Ammonia 2016-2021F, $/t 600 14 Marginal costs have escalated 500 on high end of cost curve 12 10 400 8 300 6 200 4 2 100 0 0 Mar-21 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan
Slide 23: Agenda
Agenda H2 OCI’s Unique Favorable volume Capitalizing on Focus on Value Appendix Positioning and Pricing Outlook the Hydrogen Creation and Capital Opportunity Discipline 23
Slide 24: Capitalizing on the Hydrogen Opportunity
Capitalizing on the Hydrogen Opportunity OCI’s unique strategic geographic and product footprint will drive the hydrogen transformation through value enhancing opportunities to decarbonize food, fuel, and feedstock Focus on value creation and maintaining strong capital discipline when pursuing decar
Slide 25: Our approach to climate change
Our approach to climate change To limit global warming, the world needs to rapidly OCI’s focus markets need to contribute to these reduce annual emissions emission reductions We are committed to being an environmental steward and have aligned our strategy We aim to achieve our targets through a comp
Slide 26: Hydrogen Economy is the largest value accretive opportunity for OCI
Hydrogen Economy is the largest value accretive opportunity for OCI OCI opportunities: ammonia and methanol are the only hydrogen carriers capable of decarbonizing our key sectors Growth in hydrogen demand driven key OCI sectors1 Ammonia and methanol form ~50% of grey hydrogen use and are key produc
Slide 27: Transition to hydrogen economy is key to global decarbonization
Transition to hydrogen economy is key to global decarbonization Ammonia and Methanol have a pivotal role in the Global Road-to-Zero Challenge As hydrogen carriers Multiple Blue/green decarbonized end Hydrogen as feedstock as green fuel and as production markets battery to store H2 Fuel cell vehicle
Slide 28: OCI's MENA assets ideally positioned to capitalize on abundant renewable energy
OCI’s MENA assets ideally positioned to capitalize on abundant renewable energy and supply Europe’s hydrogen shortfall Capitalizing on execution track record with strong public and private partnerships in place OCI’s MENA assets • Existing ammonia facilities and infrastructure represent ideal platfo
Slide 29: OCI will capture the transition potential with numerous key initiatives underway
OCI will capture the transition potential with numerous key initiatives underway Strategic partnerships with industry leaders on announced projects in Europe, and lower carbon projects being developed across our global asset base FUREC Renewable methanol from Carbon Capture and Storage Bio-fuels and
Slide 30: OCI's products are key to decarbonizing the maritime sector
OCI’s products are key to decarbonizing the maritime sector Emissions, CO2 / MJ (indicative) More practical/available Less practical/available Shipping makes up 3% of global Grey/ brown Blue Green GHG emissions and is one of the hardest sectors to decarbonize Fuel oil Ammonia and methanol will likel
Slide 31: OCI's products are key to decarbonizing the maritime sector
OCI’s products are key to decarbonizing the maritime sector ▪ Ammonia and methanol are the only practical alternatives for long-distance shipping. Cost of container ship and bunkering location in the Middle East Both fuels, even without the implementation of decarbonization technologies, already fro
Slide 32: Strong demand pull and willingness to pay from end customers
Strong demand pull and willingness to pay from end customers offsets small increase in end-product price Added cost to Relative price Vessel type Transported end product1 increase of end Typical shipping and owner good Typical route End-product USD product1 end client Container 1 pair of jeans Jeans
Slide 33: OCI's global distribution network is strategically located at key bunkering hubs
OCI’s global distribution network is strategically located at key bunkering hubs on major shipping lanes OCIN/OTE Terminal Rotterdam is next to the busiest bunker hub in the world OCI has production plants located along the busiest trading routes in the world OCI Beaumont Houston OCI is located at o
Slide 34: Low carbon attractiveness of green ammonia and methanol
Low carbon attractiveness of green ammonia and methanol by 2050 will drive adoption of grey and blue demand in the 2020s OCI has signed MOUs to create a marine value chain and start the commercialization of ammonia and methanol as shipping fuels by 2023/24 1. OCI, MAN Energy Solutions (MAN) and Ha
Slide 35: OCI will drive decarbonization through a 20% emission reduction target
OCI will drive decarbonization through a 20% emission reduction target1, achieved with value enhancing operational and environmental initiatives Transition pathway ~5-7.5% emission reduction through ~12.5-15% emission reduction through new Green Other solutions Blue operational excellence strategic,
Slide 36: Operational excellence drives quick wins in the short-term
Operational excellence drives quick wins in the short-term, coupled with value-enhancing initiatives in the long-term As part of our hydrogen strategy, OCI is developing numerous projects at various stages of maturity, with final we have developed a strong investment decision dependent on regulati
Slide 37: Agenda
Agenda H2 OCI’s Unique Favorable volume Capitalizing on Focus on Value Appendix Positioning and Pricing Outlook the Hydrogen Creation and Capital Opportunity Discipline 37
Slide 38: Capital Allocation Targets
We can achieve a large proportion of our ESG targets and generate positive returns with Capital Allocation Targets limited incremental capital spend : Maintaining strong capital discipline o 45% of our GHG reduction commitment is zero to low capital expenditure, including Total Capex Spend (US $m)
Slide 39: Deleveraging towards investment grade profile
Deleveraging towards investment grade profile Step-up in volumes Focus on deleveraging towards 2x net leverage through the cycle o Platform fully up and running with continued improved reliability Net Debt1 (US$ m) o Continued volume growth in Q4 2020 (15% YoY) and 23% in 2020 Deleveraging despite t
Slide 40: Appendix: About OCI
OcI Appendix About OCI 40
Slide 41: Flexible production capabilities to maximize returns
Flexible production capabilities to maximize returns Max. Proven Capacities¹ ('000 metric tons) Total Total Total2 Ammonia Ammonia Plant Country Urea UAN CAN Fertilizer Melamine4 DEF Nitrogen Methanol OCI NV (Gross) (Net)3 Iowa Fertilizer Company5 USA 926 195 438 1,832 - 2,465 - 1,019 3,484 - 3,484
Slide 42: Appendix: FY 2020 and Q4 2020 Results
Appendix FY 2020 and Q4 2020 Results 42
Slide 43: Overview Q4 2020 results: resilient earnings and volume growth
Overview Q4 2020 results: resilient earnings and volume growth Highlights Summary Key Financials1) and KPIs Own-produced volumes sold +15% in Q4 2020 vs. Q4 2019 Q4 ‘20 Q4 ‘19 %Δ FY20 FY19 %Δ Revenue 1,035.7 847.8 22% 3,474.1 3,031.7 15% • Nitrogen volumes +10% driven by strong growth in all Gross P
Slide 44: Segment information
Segment information Segment overview Q4 2020 Nitrogen Total Total $ million Europe Fertiglobe* Elim. Methanol US Europe Elim.** Other Elim. Total US Nitrogen Methanol Total revenues 149.4 190.5 498.4 (30.1) 808.2 137.8 127.0 (19.3) 245.5 0.3 (18.3) 1,035.7 Gross profit 10.7 4.5 101.5 (1.5) 115.2 (15
Slide 45: Segment information
Segment information Segment overview 2020 Nitrogen $ million Europe Fertiglobe* Elim. Total Nitrogen Methanol US Europe Elim.** Total Methanol Other Elim. Total US Total revenues 547.9 752.9 1,550.8 (72.1) 2,779.5 465.7 339.1 (62.9) 741.9 1.3 (48.6) 3,474.1 Gross profit 54.1 75.7 271.6 (0.6) 400.8 (
Slide 46: Financial highlights – reconciliation of adjusted EBITDA and adjusted net income
Financial highlights – reconciliation of adjusted EBITDA and adjusted net income Reconciliation of reported operating income to adjusted EBITDA $ million Q4 ‘20 Q4 ‘19 2020 2019 Adjustment in P&L Operating profit as reported 56.4 13.1 187.0 105.0 Depreciation and amortization 153.5 187.0 592.1 544.7
Slide 47: For OCI N.V. investor relations enquiries contact
For OCI N.V. investor relations enquiries contact: Hans Zayed hans.zayed@oci.nl T +31 (0) 6 18 25 13 67 OCI N.V. corporate website: www.oci.nl