Mesaieed Petrochemical Holding Company Q.s.c. · QSE:MPHC
Mesaieed Petrochemical Holding Company Q.s.c — Mesaieed Petrochemical Holding Company — Q1 2022 Earnings Presentation
44 slides from Mesaieed Petrochemical Holding Company Q.s.c's earnings presentation, Mar 31, 2022
Slide 1: Mesaieed Petrochemical Holding Company IR Presentation
CLASSIFICATION: C0 - NON-CONFIDENTIAL Mesaieed Petrochemical Holding Company IR Presentation 31 March 2022 “one of the region’s premier diversified petrochemical conglomerates with interests in the production of olefins, polyolefins, alpha olefins and chlor-alkali products.”
Slide 2: Disclaimer
CLASSIFICATION: C0 - NON-CONFIDENTIAL Disclaimer The companies in which Mesaieed Petrochemical Holding Company Q.P.S.C. directly and indirectly owns investments are separate entities. In this presentation, “MPHC” and “the group” are sometimes used for convenience in reference to Mesaieed Petrochemic
Slide 3: Table of Content
CLASSIFICATION: C0 - NON-CONFIDENTIAL Table of Content 1. About MPHC 2. Competitive strengths 3. Regional peers review 4. Macroeconomic updates 5. MPHC results (For the three-month period ended 31 March 2022) 6. Segment results (For the three-month period ended 31 March 2022) 7. CAPEX (2022F – 2026F
Slide 4: About MPHC
CLASSIFICATION: C0 - NON-CONFIDENTIAL About MPHC 4
Slide 5: MPHC at a glance
CLASSIFICATION: C0 - NON-CONFIDENTIAL MPHC at a glance Overview • Mesaieed Petrochemical Holding Company • QatarEnergy provides most head office Q.P.S.C. (“MPHC” or “the Group”; QE ticker: functions through a comprehensive service- MPHC) was incorporated on May 29, 2013 and level agreement. was list
Slide 6: MPHC business segments at a glance
CLASSIFICATION: C0 - NON-CONFIDENTIAL MPHC business segments at a glance Business segments overview Segments size by Revenue • Through its joint ventures companies, MPHC operates in two distinct business segments: Petrochemical Petrochemical and Chlor-Alkali; 38.7% Chlor-Alkali • Production faciliti
Slide 7: Competitive strengths
CLASSIFICATION: C0 - NON-CONFIDENTIAL Competitive strengths 7
Slide 8: Competitive strengths
CLASSIFICATION: C0 - NON-CONFIDENTIAL Competitive strengths • Assured feedstock supply Low cost • Economies of scale and operationally diversified producer • Synergy benefits Strong • Solid liquidity position financial • Strong cash flow generation with stable EBITDA margins position • Sound dividen
Slide 9: Regional peers review
CLASSIFICATION: C0 - NON-CONFIDENTIAL Regional peers review MPHC ranked #85 among “2021 Forbes List of Top 100 Companies in the Middle East” 9
Slide 10: Competitive positioning versus regional peers
CLASSIFICATION: C0 - NON-CONFIDENTIAL Competitive positioning versus regional peers Market Cap. (USD’ billion) Net profit (USD’ million) Peer 1 104.8 Peer 1 6,150 13% Peer 2 2,222 40% Peer 2 31.6 Net profit margin (%) Peer 3 958 36% Peer 3 10.5 Peer 4 637 19% MPHC 10.0 MPHC ranks #4 MPHC 510 47% MPH
Slide 11: Macroeconomic updates
CLASSIFICATION: C0 - NON-CONFIDENTIAL Macroeconomic updates 11
Slide 12: Macroeconomic updates
CLASSIFICATION: C0 - NON-CONFIDENTIAL Macroeconomic updates Petrochemicals 1350 1250 • Demand for most of the PE products slightly inched 1150 HDPE ($/MT) downward, as buyers remained cautious hoping for lower 1050 prices after reaching its peak in last year. Also, seasonal effects weighed on most o
Slide 13: MPHC results
CLASSIFICATION: C0 - NON-CONFIDENTIAL MPHC results (For the three-month period ended 31 March 2022) 13
Slide 14: 1Q-22 results at a Glance
CLASSIFICATION: C0 - NON-CONFIDENTIAL 1Q-22 results at a Glance Growth vs. 1Q-21 Revenue 9% EBITDA 13% Net profit 17% QR 970 million QR 543 million QR 443 million EBITDA Margin: 55.9% EPS: QR 0.035 RoAE: 12.1% • Year-on-year results reflected constructive product price momentum carried forward from
Slide 15: Operational performance review
CLASSIFICATION: C0 - NON-CONFIDENTIAL Operational performance review Production (MT’ 000) • 1Q-22 vs 1Q-21: production volumes declined on a year-on- year basis, mainly due to a largescale turnaround carried out at Q-Chem facilities during the current period. • 1Q-22 vs 4Q-21: Production volumes rem
Slide 16: Financial performance review
CLASSIFICATION: C0 - NON-CONFIDENTIAL Financial performance review Revenue (QR’ million) • 1Q-22 vs 1Q-21: revenue improved by 9% mainly due to higher selling prices, partially offset by lowered sales volumes. • 1Q-22 vs 4Q-21: revenue slightly increased 3% on a quarter-on-quarter basis, with flatti
Slide 17: Net Profit Variance Analysis
CLASSIFICATION: C0 - NON-CONFIDENTIAL Net Profit Variance Analysis QR ‘millions Net profits increased by QR 64 million due to: Favorable variance • Higher selling prices 26%; • Favorable inventory differential due to lesser drawdowns; Unfavorable variance • Lesser sales volumes 14%; • Slightly highe
Slide 18: MPHC operating rates
CLASSIFICATION: C0 - NON-CONFIDENTIAL MPHC operating rates Operating rates of MPHC segments remained stable 120% 116% 115% 112% 111% 111% 110% 109% 109% 105% 104% 104% 102% 102% 102% 97% 96% 93% 91% 90% 90% 87% 85% 85% 84% 84% 81% 80% 78% 75% 75% 70% 64% 63% 57% 41% 2Q-19 3Q-19 4Q-19 1Q-20 2Q-20 3Q-
Slide 19: Geographic analysis – MPHC Group revenue
CLASSIFICATION: C0 - NON-CONFIDENTIAL Geographic analysis – MPHC Group revenue Asia including ISC remained MPHC’s largest market, while its presence in Europe continued to be substantial Europe 25% Qatar Middle East 3% Asia, ex. ISC 4% 22% Africa Indian sub-continent 4% 42% 19 Mesaieed Petrochemical
Slide 20: Robust EBITDA margins
CLASSIFICATION: C0 - NON-CONFIDENTIAL Robust EBITDA margins Despite the volatile trends in commodity prices, MPHC’s EBITDA margins continue to remain robust 150 61% 65% 58% 60% 130 56% 56% Oil price (USD/bbl), brent 54% MPHC EBITDA Margins (%) 55% 110 50% 47% 50% 90 45% 70 38% 40% 35% 50 29% 30% 30
Slide 21: Segmental results
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental results (For the three-month period ended 31 March 2022) 21
Slide 22: Segmental Details: Petrochemicals
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental Details: Petrochemicals ▪ Q-Chem and Q-Chem II are both owned 49% by MPHC, 49% by Chevron Phillips Chemical International Qatar Holdings L.L.C., and 2% by QatarEnergy; ▪ Q-Chem II also has an effective ownership of 53.85% in Ras Laffan Olefins Company
Slide 23: Segmental Details: Petrochemicals
CLASSIFICATION: C0 - NON-CONFIDENTIAL Analysis of production & Segmental Details: Petrochemicals selling prices ▪ Production: Production down by 24% compared to 1Q-21, as the segment had planned periodic turnaround at Q-Chem facilities during 1Q-22, which affected the overall operating rates for 1Q-
Slide 24: Segmental Details: Petrochemicals
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental Details: Petrochemicals Analysis of segment revenue & net profit ▪ Revenue: QR 594 million, down by 4% as compared to 1Q-21 due to lower sales volumes (-21%), mostly offset by higher selling prices (+23%); ▪ 1Q-22 revenue significantly down by 23% comp
Slide 25: Segmental Details: Petrochemicals
CLASSIFICATION: C0 - NON-CONFIDENTIAL Geographical analysis of Segmental Details: Petrochemicals segment revenue ▪ Asia remains a main market for Petrochemical segment ▪ Europe and Indian sub-continent remain other key markets 1Q-22 Segment Revenue (%) 1Q-21 Segment Revenue (%) 3% 3% 4% 4% 2% 9% 39%
Slide 26: Segmental Details: Petrochemical key segment products analysis
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental Details: Petrochemical Key segment products analysis HDPE (contributed ~59% of the segment revenue in 1Q-22) 1,301 1,164 1,178 1,070 1,134 773 832 906 718 88 97 109 133 110 109 119 119 79 1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 3Q-21 4Q-21 1Q-22 NAO (contr
Slide 27: Segmental Details: Chlor-Alkali
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental Details: Chlor-Alkali ▪ Qatar Vinyl Company Limited Q.S.C. (“QVC”) is owned 55.2% by MPHC, 31.9% by Qapco and 12.9% by QatarEnergy; ▪ QVC’s operations have been integrated with Qapco, bringing additional synergies to the group. ▪ The segment is engaged
Slide 28: Segmental Details: Chlor-Alkali
CLASSIFICATION: C0 - NON-CONFIDENTIAL Analysis of production & Segmental Details: Chlor-Alkali selling prices ▪ Production: Production increased by 5% as compared to 1Q-21, as 1Q-22 had higher number of operating days versus 1Q-21; ▪ Production increased during 1Q-22 by 88% compared to 4Q-21, due to
Slide 29: Segmental Details: Chlor-Alkali
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental Details: Chlor-Alkali Analysis of segment revenue & net profit ▪ Revenue: QR 376 million, up by 36% as compared to 1Q-21 due to higher product prices (+40%), slightly offset by lower sales volumes (-3%); ▪ Revenue for 1Q-22 up by 114% compared to 4Q-21
Slide 30: Segmental Details: Chlor-Alkali
CLASSIFICATION: C0 - NON-CONFIDENTIAL Geographical analysis of Segmental Details: Chlor-Alkali segment revenue ▪ Indian sub-continent and Asia remain a main market for Chlor-Alkali segment 1Q-22 Segment Revenue (%) 1Q-21 Segment Revenue (%) 2% 1% 5% 7% 1% 6% 3% 2% 5% 1% 81% 86% Asia, excl. ISC Afric
Slide 31: Segmental Details: Chlor-Alkali key segment products analysis
CLASSIFICATION: C0 - NON-CONFIDENTIAL Segmental Details: Chlor-Alkali Key segment products analysis Vinyl Chloride Monomer (VCM) (contributed ~52% of the segment revenue in 1Q-22) 1,108 1,122 1,132 1,207 1,224 891 715 601 448 39 30 47 56 53 46 58 18 45 1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 3Q-21 4Q-21
Slide 32: CAPEX (2022F – 2026F)
CLASSIFICATION: C0 - NON-CONFIDENTIAL CAPEX (2022F – 2026F) 32
Slide 33: CAPEX (2022F – 2026F) – MPHC share
CLASSIFICATION: C0 - NON-CONFIDENTIAL CAPEX (2022F – 2026F) – MPHC share o Cumulative CAPEX spend of QR 1.5 billion across CAPITAL EXPENDITURE (Amounts in QAR' millions) all segments during 2022-2026; Project Name Category 2022 2023 2024 2025 2026 Turnaround related Turnaround 141.6 1.8 12.5 44.6 14
Slide 34: Dividends & Market Capitalization
CLASSIFICATION: C0 - NON-CONFIDENTIAL Dividends & Market Capitalization 34
Slide 35: Dividends & Market Statistics
CLASSIFICATION: C0 - NON-CONFIDENTIAL Dividends & Market Statistics Payout Ratio (%) Dividend per share 0.12 77% 94% 74% 100% 81% 76% 81% 72% 74% 0.1 72% 80% 0.08 60% 0.06 0.11 0.11 40% 0.04 0.07 0.07 0.07 0.06 0.08 20% 0.02 0.04 0.04 0 0% 2013 2014 2015 2016 2017 2018 2019 2020 2021 QR 36.6 billion
Slide 36: Historical performance (2016 – 2021)
CLASSIFICATION: C0 - NON-CONFIDENTIAL Historical performance (2016 – 2021) 36
Slide 37: Historical performance (2016 – 2021)
CLASSIFICATION: C0 - NON-CONFIDENTIAL Historical performance (2016 – 2021) Production (MT’000) Utilization (%) Production and sales volumes remained relatively stable ▪ Utilization moved in line with the production levels ▪ Selling prices reflected cyclical movements inline with the global commodity
Slide 38: Historical performance (2016 – 2021)
CLASSIFICATION: C0 - NON-CONFIDENTIAL Historical performance (2016 – 2021) Revenue (Million QR) Net Profit (Million QR) Both revenue and net profit witnessed movements, in line with product prices ▪ Total assets grew marginally, while the cash and cash equivalents remained robust Total Assets (Milli
Slide 39: Governance Structure
CLASSIFICATION: C0 - NON-CONFIDENTIAL Governance Structure 39
Slide 40: Governance
CLASSIFICATION: C0 - NON-CONFIDENTIAL Governance Board Structure Board Committees ▪ MPHC Board of Directors consists of seven (7) ▪ The Board of Directors established Board Committees Directors, all of whom were appointed by the Special and Special Committees to carry out specific tasks. The Shareho
Slide 41: Governance
CLASSIFICATION: C0 - NON-CONFIDENTIAL Governance Remuneration • Board of Directors Shareholders rights ▪ The Company has developed a periodically ▪ The Company’s Articles of Associations provide for the rights revisited remuneration policy for Board of shareholders, particularly the rights to receiv
Slide 42: Sales and Marketing
CLASSIFICATION: C0 - NON-CONFIDENTIAL Sales and Marketing 42 INDUSTRIES QATAR | Quarterly Financial Update (2014 Q4) | Page 42
Slide 43: Sales and Marketing
CLASSIFICATION: C0 - NON-CONFIDENTIAL Sales and Marketing • Qatar Chemical and Petrochemical Marketing and Distribution Company (“Muntajat”), a wholly-owned company of the government of the State of Qatar, has the exclusive rights to purchase, market, sell and distribute the State’s production of pe
Slide 44: For further information, Mesaieed Petrochemical Holding Company can be contacted
CLASSIFICATION: C0 - NON-CONFIDENTIAL For further information, Mesaieed Petrochemical Holding Company can be contacted as follows: Telephone: (+974) 4013 2080 Fax: (+974) 4013 9750 Email: mphc.investorrelations@qatarenergy.qa or mphc@qatarenergy.qa Address: PO Box 3212, Doha, State of Qatar Please r
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