Fmc Corporation · NYSE:FMC
Fmc — Citigroup Chemicals Conference 2005
23 slides from Fmc's conference presentation, Dec 8, 2005
Slide 1: FMC Corporation - Citigroup Chemicals Conference
FMC Corporation Citigroup Chemicals Conference New York, NY December 6, 2005 William G. Walter Chairman, President and CEO
Slide 2: Disclaimer
Exhibit 99.1 Disclaimer Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 • These slides and the accompanying presentation contain “forward-looking statements” that represent management’s best judgment as of the date hereof based on information currently available. Act
Slide 3: FMC Corporation
FMC Corporation Diversified chemical company with leading market positions in industrial, consumer and agricultural markets globally ($ millions, LTM ending September 30, 2005) FMC Sales: $2,141.7 EBITDA: $420.5 EBITDA Margin: 19.6% Industrial Specialty Agricultural Chemicals Chemicals Products Sale
Slide 4: Leading Market Positions
Leading Market Positions Product Group Position(1) Industrial Soda Ash #1 in N.A. Chemicals Hydrogen Peroxide #1 in N.A. Agricultural Pyrethroids #2 in N.A. Products Carbofuran #1 Globally Microcrystalline Cellulose #1 Globally Specialty Carrageenan #1 Globally Chemicals Alginates #2 Globally Lithiu
Slide 5: Diversified Customers and End Markets
Diversified Customers and End Markets 2004 Consolidated Sales Bottle Other 12% Glass 3% Cyclical Non-Cyclical Chemicals 6% 19% 81% Food 8% Pulp & Paper 4% Glass/Fiberglass 4% Pharmaceuticals 11% Electronics 2% Other 3% Detergents 9% Chemicals 4% Agricultural 34% Greater than 80% of sales to non-cycl
Slide 6: Diversified and Integrated Cost Structure
Diversified and Integrated Cost Structure Low cost sourcing of raw materials – Backward integration: soda ash, lithium – Global sourcing of renewable resources: wood pulp, seaweed Low reliance on purchased raw materials – Total raw materials represent approximately 25% of cost of sales – No single r
Slide 7: Disciplined Approach to Unlocking Value
Disciplined Approach to Unlocking Value Realizing the inherent operating leverage within FMC - Sustained earnings growth >10% per year(1) - Industrial Chemicals recovery in mid-cycle in 2005 - Continued growth in Specialty Chemicals and Agricultural Products Creating greater financial flexibility -
Slide 8: Industrial Chemicals
Asia 7% Industrial Chemicals Based on 2004 Consolidated Sales of $813.7 million Asia 7% Foret 35% Alkali (Soda ash) Europe/Middle North America 46% East/Africa 50% 35% Peroxygens Latin 19% America 8% #1 North American manufacturer of soda ash and peroxygens Backward integration into natural resource
Slide 9: Industrial Chemicals Financial Performance
Industrial Chemicals Financial Performance Earnings growth of 45% expected in 2005 driven by higher selling prices, partially offset by higher energy, raw material and transportation costs 200 20% 150 $151 15% $133 $130 $124 100 $94 10% 50 5% 0 0% 2001 2002 2003 2004 LTM 9/30/05 EBITDA Capital Spend
Slide 10: Industrial Chemicals' Focus
Industrial Chemicals’ Focus Managing for cash generation Near-term sales growth – Higher selling prices for soda ash – Incremental soda ash capacity addition at Granger – US and European peroxides producers have announced price increases Margin expansion - Working to offset rising energy, raw materi
Slide 11: Growth Franchises in Specialty Chemicals
Growth Franchises in Specialty Chemicals Based on 2004 Consolidated Sales of $538.0 million Asia 15% Lithium 28% North America 41% Europe/Middle BioPolymer East/Africa 72% 36% Latin America 8% BioPolymer: • Adds structure, texture and stability to food • Acts as a binder & disintegrant for dry table
Slide 12: Specialty Chemicals Financial Performance
Specialty Chemicals Financial Performance 2005 earnings growth expected to be approximately 15%, driven by increased selling prices and productivity improvement 160 30% $140 $132 $129 $122 28% $116 120 26% 80 24% 40 22% 0 20% 2001 2002 2003 2004 LTM 9/30/05 EBITDA Capital Spending EBITDA Margin 11
Slide 13: Specialty Chemicals Focus
Specialty Chemicals Focus Growing existing core business – Maintaining key positions with category leading customers – Shifting resources toward faster growing segments – Expanding presence in rapidly growing emerging markets Commercializing new technology platforms Managing maturing segments for im
Slide 14: Agricultural Products
Agricultural Products Based on 2004 Consolidated Sales of $703.5 million Asia 13% Herbicides 25% Europe/ Middle Latin America East/Africa 36% Fungicides 2% 16% Insecticides 73% North America 35% Strong niche positions in the Americas, Europe and Asia Proprietary, branded insecticides and herbicides
Slide 15: Agricultural Products Financial Performance
Agricultural Products Financial Performance Earnings growth of 5% expected in 2005, reflecting higher sales and lower manufacturing costs partially offset by lower bifenthrin pricing and higher raw materials costs. $160 25% $148 150 $111 20% $101 $99 100 15% 10% 50 5% 0 0% 2001 2002 2003 2004 LTM 9/
Slide 16: Agricultural Products' Focus
Agricultural Products’ Focus Creating competitive advantage through innovation – Investing 10% of sales in R&D – In-licensing products & technologies that complement segment strategies Driving near-term sales growth – Label expansions and new formulations in crop and non-crop segments – In-licensed
Slide 17: FMC in Summary
FMC in Summary Great businesses, each with EBITDA of at least $140 million Double digit earnings growth - Earnings leverage in Industrial Chemicals - Continued growth in Specialty Chemicals and Ag Products Strong financial position - Robust and growing EBITDA - Substantial decline in unusual demands
Slide 18: FMC Remains Significantly Undervalued
FMC Remains Significantly Undervalued EV/2006E EBITDA 10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 Source: Thomson First Call; Data as of December 2, 2005 17
Slide 19: FMC Corporation
FNC FMC Corporation
Slide 20: Non-GAAP Financial Terms
Non-GAAP Financial Terms These slides contain certain “non-GAAP financial terms” which are defined below. In addition, we have provided reconciliations of non-GAAP terms to the closest GAAP term in the appendix of this presentation. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortizat
Slide 21: Segment Financial Terms
Segment Financial Terms These slides contain references to segment financial items which are presented in detail in Note 18 of FMC’s 2004 Form 10-K. Some of the segment financial terms are “non-GAAP financial terms” and are defined below. In addition, we have provided reconciliations of non-GAAP ter
Slide 22: EBITDA Reconciliation: LTM 9/30/05
EBITDA Reconciliation: LTM 9/30/05 Reconciliation of LTM 9/301/2005 consolidated income from continuing operations before income taxes (a GAAP measure) to LTM 9/30/2005 EBITDA (a Non-GAAP measure) (Unaudited, in $ millions) LTM 9/30/2005 Income (loss) from continuing operations before income taxes $
Slide 23: Segment EBITDA Reconciliation
Segment EBITDA Reconciliation Reconciliation of LTM 9/30/05 segment operating profit (a GAAP measure) to LTM 9/30/05 EBITDA (a Non-GAAP measure) (Unaudited, in millions) Industrial Specialty Agricultural Segment Chemicals Chemicals Products LTM 9/30/05 segment operating profit (GAAP) $82.6 $106.9 $1