Icl Group Ltd. · TASE:ICL
Icl — Q3 2018 Earnings Presentation
26 slides from Icl's earnings presentation, Nov 1, 2018
Slide 1: Q3 2018 Results
Q3 2018 Results Raviv Zoller, President & CEO November 1, 2018
Slide 2: Important Legal Notes
Important Legal Notes Disclaimer and Safe Harbor for Forward-Looking Statements The information contained herein in this presentation or delivered or to be delivered to you during our presentation does not constitute an offer, expressed or implied, or a recommendation to do any transaction in Israel
Slide 3: Q3 2018 Highlights
Q3 2018 Highlights Sequential sales were flat as a result of lower potash sales volumes due to the late signing of supply contracts with customers in India and China Operating income up by 9%. Net income up by 54% Operating income excluding divested businesses(1) increased by 43% driven by continuou
Slide 4: Continued Strong Performance
Continued Strong Performance $ millions Q2 18 Q3 18 Q3 17 % change Sales 1,371 1,371 1,440 (5)% Sales pro-forma(2) 1,362 1,371 1,280 7% Operating income reported 172 196 180 9% Operating income adjusted(1) 188 200 215 (7)% Operating income Adj. (1) Pro-forma(2) 190 200 140 43% Net income reported 10
Slide 5: Industrial Products Business Performance
Industrial Products Business Performance SALES(1) SEGMENT PROFIT(2) $ millions +13% Another strong quarter driven by higher prices and sales volumes 328 +23% Strong sales of clear brine fluids 289 carried forward into Q3 driven by 95 demand from the oil and gas industry 77 Bromine and phosphorus
Slide 6: Potash Business Performance
Potash Business Performance SALES(1) SEGMENT PROFIT(2) $ millions +10% Tight market conditions reflected in higher than expected increase in +49% 409 contract prices and a continuous 372 97 upward trend in spot prices Lower sales volumes due to the delay in signing of supply contracts with 65 Chin
Slide 7: Phosphate Solutions Business Performance
Phosphate Solutions Business Performance SALES(1) SEGMENT PROFIT(2) $ millions +4% Consolidation of commodity and specialty business on track. Focus on +19% value chain optimization and strategy 530 execution continues 511* 63 53* Performance improved significantly with an 11% sequential growth in
Slide 8: IAS Business Performance
IAS Business Performance SALES(1) SEGMENT PROFIT(2) $ millions +5% Realigning the business for future growth including sales, marketing, logistics and digital infrastructure, and 161 154 customer base optimization A clear and defined seasonality impacts results, with the second half of the year -2
Slide 9: Favorable Market Pricing Trends
Favorable Market Pricing Trends 290 ICL’S AVG. FOB POTASH PRICE DEVELOPMENT 850 PHOSPHORIC ACID CFR INDIA (3) PRICE DEVELOPMENT 800 270 750 250 US$/TONNE US$/TONNE 700 230 650 210 600 190 550 500 170 105 5100 CHINA BROMINE(1) PRICE DEVELOPMENT % WHITE PHOSPHORIC ACID PRICE INDEX(2) US$/TONNE 100 460
Slide 10: Kobi Altman, CFO
Kobi Altman, CFO
Slide 11: Sequential Performance Improvement
Sequential Performance Improvement ADJUSTED EPS OPERATING CASH FLOW QUARTERLY DIVIDEND PAYOUT CENTS/SHARE US$ MILLION US$ MILLION 10 196 66 9 164 8 56 52 36 Q1 2018 Q2 2018 Q3 2018 Q1 2018 Q2 2018 Q3 2018 Q1 2018 Q2 2018 Q3 2018 11
Slide 12: Another Quarter of Positive Contribution to Sales from All Segments
Another Quarter of Positive Contribution to Sales from All Segments $ millions 7 11 160 19 37 39 1,440 1,371 1,280 Numbers may not add due to rounding and set offs. 12
Slide 13: Solid Operating Income Performance Despite Divestments
Solid Operating Income Performance Despite Divestments $ millions 11 2 1 75 32 18 215 200 140 See Q3 2018 6-K for a reconciliation of adjusted operating income to operating income. Numbers may not add due to rounding and set offs. * Pro-forma excluding contribution of $75 million of divested busines
Slide 14: Cash flow Development
Cash flow Development $ millions Q3 18 Q2 18 Q3 17 Net income 134 113 115 Depreciation, amortization 94 105 97 Other adjustments to net income 75 9 (18) Change in Working capital (107) (63) (18) Net cash provided by operating activities 196 164 176 Capex (145) (121) (98) Free cash Flow 51 43 78 See
Slide 15: Q3 2018 Key Takeaways
Q3 2018 Key Takeaways CONTINUOUS IMPROVING BUSINESS EXECUTION OF OUR STRONG PERFORMANCE ENVIRONMENT VALUE-FOCUSED STRATEGY 15
Slide 16: On the Verge of a Tipping Point
On the Verge of a Tipping Point… POSITIVE BUSINESS IMPROVING MARKET SHARE OVERHANG MOMENTUM CONDITIONS REMOVED Q2 2018 continued strong performance, Higher commodity prices, Nutrien successfully sold its ~14% margin expansion and successful value- demand growth and tight supply stake to a group of I
Slide 17: Appendix
ANICL APPENDIX
Slide 18: Sales and Operating Income Analysis
Sales and Operating Income Analysis Q3 2018 SALES Q3 2018 ADJUSTED OPERATING INCOME $ millions $ millions 33 6 160 130 3 8 16 18 130 31 1,440 1,371 75 1,280 215 200 140 See Q3 2018 6-k for a reconciliation of adjusted operating income to operating income. Numbers may not add due to rounding and set
Slide 19: Industrial Products Sales and Segment Profit Analysis
Industrial Products Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT $ millions $ millions 19 20 6 2 5 19 328 289 95 77 Excluding G&A and unallocated expenses Numbers may not add due to rounding and set offs 19
Slide 20: Potash Sales and Segment Profit Analysis
Potash Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT $ millions $ millions 15 2 54 1 9 14 54 409 372 97 65 Excluding G&A and unallocated expenses Numbers may not add due to rounding and set offs 20
Slide 21: Phosphate Solutions Sales and Segment Profit Analysis
Phosphate Solutions Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT $ millions $ millions 6 52 27 9 2 3 9 11 52 21 520 530 511 1 63 52 53 Excluding G&A and unallocated expenses Numbers may not add due to rounding and set offs 21
Slide 22: Innovative Ag Solutions Sales and Segment Profit Analysis
Innovative Ag Solutions Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT $ millions $ millions 4 3 1 3 3 154 161 3 9 7 Excluding G&A and unallocated expenses Numbers may not add due to rounding and set offs 22
Slide 23: Effective Tax Rate
Effective Tax Rate $ millions Q3 18 FY2017 Adjusted income before tax(1) 179 528 Normalized tax rate (including resource tax) 23% 25% Normalized tax expenses 42 136 Carryforward losses not recorded for tax purposes 4 19 Sub-Total 46 155 Sub-Total - % 26% 29% Other items (mainly exchange rate impact)
Slide 24: Reconciliation Tables
Reconciliation Tables Calculation of Adjusted income before tax ($ millions) Q3 18 FY2017 Adjusted operating income 200 652 Finance expenses (23) (124) Share in earnings (losses) of equity-accounted investees and adjustments to financial expenses 2 - Adjusted income before tax 179 528 Calculation of
Slide 25: Non-GAAP Financial Measures
Non-GAAP Financial Measures We disclose in this Quarterly Report non-IFRS financial measures titled adjusted operating income, adjusted net income attributable to the Company’s shareholders, adjusted EBITDA and free cash flow. Our management uses adjusted operating income, adjusted net income attrib
Slide 26: Thank You
THANK YOU visit us at www.icl-group.com