Cf Industries Holdings, Inc. · NYSE:CF

Cf Industries — Q2 2023 Earnings Presentation

21 slides from Cf Industries's earnings presentation, Aug 3, 2023

1. Slide 1: 2023 First Half and Second Quarter Financial Results

   2023 First Half and Second Quarter Financial Results August 2, 2023 NYSE: CF

2. Slide 2: Safe harbor statement

   Safe harbor statement All statements in this presentation by CF Industries Holdings, Inc. (together with its subsidiaries, the “Company”), other than those relating to historical facts, are forward-looking statements. Forward-looking statements can generally be identified by their use of terms such

3. Slide 3: Note regarding non-GAAP financial measures

   Note regarding non-GAAP financial measures The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). Management believes that EBITDA, adjusted EBITDA, free cash flow, free cash flow to adjusted EBITDA conversion and free cash flow yield, which

4. Slide 4: Strong first half operational performance, robust demand underpin solid results

   Strong first half operational performance, robust demand underpin solid results  Solid results driven by robust nitrogen Net earnings Net earnings per demand, favorable gas cost and strong diluted share operational performance $1.09 B $2.05 B $5.55 $9.78  Returned ~$1.3 billion to shareholders ove

5. Slide 5: Financial results – second quarter and first half 2023

   Financial results – second quarter and first half 2023 In millions, except percentages, per MMBtu and EPS Q2 2023 Q2 2022 1H 2023 1H 2022 Net sales $ 1,775 $ 3,389 $ 3,787 $ 6,257 Gross margin 804 1,991 1,667 3,689 - As a percentage of net sales 45.3 % 58.7 % 44.0 % 59.0 % Net earnings attributable

6. Slide 6: Nitrogen market enters 2H tighter than expected

   Nitrogen market enters 2H tighter than expected Supply/Demand Dynamics China Urea Exports Million metric tons  Substantial imports needed by Brazil & India; expected to be between 9 to 11M tons 6  Northern Hemisphere needs to restock from low inventory 5 levels 4 ~2-3M  European run-rates below c

7. Slide 7: Forward global energy curves suggest attractive margin opportunities for CF's cost-advantaged network

   Forward global energy curves suggest attractive margin opportunities for CF’s cost-advantaged network Global Energy Price 2023-2024F North American Production Margin Advantage(1) USD per MMBtu USD per Metric Ton (MT) 40 500 Ammonia(2) Urea JKM natural gas 35 TTF natural gas Chinese anthracite coal 4

8. Slide 8: Capital management strategy with a long-term view

   Capital management strategy with a long-term view Focused on increasing free cash flow generation capacity and growing shareholder participation in our free cash flow Blue & green Evaluating DEF & ammonia projects Nitric Acid production expansion Disciplined growth Invest in high return initiatives

9. Slide 9: Significant progress to support our commitment to a clean energy economy

   Significant progress to support our commitment to a clean energy economy 2023 2024 2025 2027 Initiated Purchased 2.2 billion Decarbonization cubic feet of natural gas certified by MiQ Expected Electrolyzer project installation has completion begun Donaldsonville green ammonia Engineering 2025 activi

10. Slide 10: Strong free cash flow metrics show undervalued equity

    Strong free cash flow metrics show undervalued equity Canada/US Free Cash Flow Yield(1) tax matter (3) 19.6%(3) 19.5%(3) 2018-Q2 2023 LTM average yield 16.7% 15.8% 14.7% 9.7% 8.9% 9.0% 2018 2019 2020 2021 2022 Q2 2023 LTM FCF/Adj EBITDA 67% 57% 55% 79% 47% 53% conversion(2) % (3) (3) 56% 65% Attract

11. Slide 11: Appendix

    Appendix

12. Slide 12: Global nitrogen market expected to remain strong for remainder of 2023 and into 2024

    Global nitrogen market expected to remain strong for remainder of 2023 and into 2024 Pricing Supply/Demand Energy Differentials  Global nitrogen prices stabilized  North American farmer profitability  Energy differentials between North during the latter part of the second continues to be strong.

13. Slide 13: Low stocks-to-use ratios drive healthy grain values; strong production required to replenish stocks

    Low stocks-to-use ratios drive healthy grain values; strong production required to replenish stocks Global Coarse Grains Stocks-to-Use Ratio Global Oilseeds Stocks-to-Use Ratio vs vs Corn Futures Prices(1) Soybean Futures Prices Percent USD per Bushel Percent USD per Bushel 16% $7 30% $16 14% $6 $14

14. Slide 14: Outstanding safety performance drives industry leading production capacity utilization

    Outstanding safety performance drives industry leading production capacity utilization Total Recordable Incident Rate North American Ammonia Percent of Capacity Utilization (1) Total injuries per 200,000 work hours 5-Year Rolling Avg. Percent of Capacity 100% CF North 4.5 98% America (2) 97% 96% 96%

15. Slide 15: Capacity growth coupled with share repurchases continue to drive nitrogen participation per share

    Capacity growth coupled with share repurchases continue to drive nitrogen participation per share… CF Industries’ Nitrogen Volumes and Shares Outstanding as of June 30, 2023 2009 – Q2 2023 Nitrogen per share CAGR: 10.7% Annual Nitrogen Equivalent Tons per 1,000 Shares Outstanding Million Shares Outs

16. Slide 16: …resulting in strong free cash flow participation

    …resulting in strong free cash flow participation CF Industries’ Free Cash Flow and Shares Outstanding as of period-end LTM Free Cash Flow (millions) Shares Outstanding (millions)(3) Canada/US tax matter (2) $4,000 350 $3,000 300 250 $2,000 200 $1,000 150 $0 100 -$1,000 50 -$2,000 0 2011 2012 2013 2

17. Slide 17: CF Industries Adjusted EBITDA sensitivity table

    CF Industries Adjusted EBITDA sensitivity table Table illustrates the CF Industries business model across a broad range of industry conditions Adjusted EBITDA Sensitivity to Natural Gas and Urea Prices(1) $ billions CF Realized Natural Gas Cost ($/MMBtu) 2.00 2.50 3.00 3.50 4.00 4.50 5.00 $300 $2.2

18. Slide 18: Non-GAAP: reconciliation of net earnings to EBITDA and adjusted EBITDA

    Non-GAAP: reconciliation of net earnings to EBITDA and adjusted EBITDA In millions Q2 2023 Q2 2022 1H 2023 1H 2022 Net earnings $ 606 $ 1,339 $ 1,256 $ 2,390 Less: Net earnings attributable to noncontrolling interest (79) (174) (169) (342) Net earnings attributable to common stockholders 527 1,165 1

19. Slide 19: Non-GAAP: reconciliation of net earnings to EBITDA and adjusted EBITDA, continued

    Non-GAAP: reconciliation of net earnings to EBITDA and adjusted EBITDA, continued In millions Q2 2023 LTM FY 2022 FY 2021 Net earnings $ 2,803 $ 3,937 $ 1,260 Less: Net earnings attributable to noncontrolling interest (418) (591) (343) Net earnings attributable to common stockholders 2,385 3,346 917

20. Slide 20: Non-GAAP: reconciliation of net earnings to EBITDA and adjusted EBITDA, continued

    Non-GAAP: reconciliation of net earnings to EBITDA and adjusted EBITDA, continued In millions FY 2020 FY 2019 FY 2018 Net earnings $ 432 $ 646 $ 428 Less: Net earnings attributable to noncontrolling interests (115) (153) (138) Net earnings attributable to common stockholders 317 493 290 Interest exp

21. Slide 21: Non-GAAP: reconciliation of cash from operations to free cash flow and free cash flow yield

    Non-GAAP: reconciliation of cash from operations to free cash flow and free cash flow yield In millions, except percentages, share FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 Q2 2023 LTM price, and ratios Cash provided by operating activities(1) $ 1,497 $ 1,505 $ 1,231 $ 2,873 $ 3,855 $ 3,234 Capital ex

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