Orica Limited · ASX:ORI
Orica — Investor Presentation (April 2019)
14 slides from Orica's investor presentation, April 2019
Slide 1: Manufacturing and Supply Chain
APRIL 2019 MANUFACTURING AND SUPPLY CHAIN CARLOS DUARTE, GROUP EXECUTIVE MANUFACTURING & SUPPLY
Slide 2: Carlos Duarte
CARLOS DUARTE Carlos was appointed as Group Executive Manufacturing and Group Executive Supply in October 2017. Manufacturing & Supply Carlos is responsible for Continuous Manufacturing, IS & PE Manufacturing and Global Supply Chain. He recently also took on responsibility of Global SHES. Prior to j
Slide 3: Our strategic priorities
Our strategic priorities Be the market leader in chosen segments; deliver superior returns on investment; and generate strong free cash Disciplined capital allocation across the portfolio Manufacturing and Supply Blasting Field Services Productivity Solutions Cost leader Market leader Value differen
Slide 4: Flexible sourcing capability
Flexible sourcing capability Our global manufacturing network is complemented by third party sourcing Karelia, Russia Gyttorp, Carseland, Sweden Canada Tappen, Canada Sirgala, Estonia Brownsburg, Canada Ust’ Hallowell, Panaguirishte, Kamenogorsk, USA Bulgaria Kazakhstan Minden, Lalahan, USA Turkey W
Slide 5: Context and background
Context and background Manufacturing performance has been below expectations for more than a decade IMMEDIATE CAUSES: KEY FOCUS AREAS: • Low reliability and integrity performance in • SHES performance, reduction in downtime continuous manufacturing plants and unplanned maintenance and increase in •
Slide 6: Key priorities: short to medium term
Key priorities: short to medium term Capturing value across the portfolio 1. CONTINUOUS 2. INITIATING BUSINESS 3. SUPPLY CHAIN PLANTS SYSTEMS PLANTS Reliability and Utilisation and Cost Supply Planning FOCUS Integrity Reduction Process Reduction of Improvement in downtime and Product portfolio forec
Slide 7: 1. Continuous plants
1. Continuous plants Focus areas to improve overall AN manufacturing performance PREVIOUS STATE TODAY AND FUTURE STATE BENEFIT • Pervasive lack of standardisation – • Standardised organisation • Optimised maintenance organisation structure, business design implemented strategy to reduce downtime PEO
Slide 8: 1. Continuous plants
1. Continuous plants Improved AN Manufacturing performance over past 18 months AN PLANT OEE PERFORMANCE VS BENCHMARK Yarwun AN OEE 100% (12 Month Rolling) 90% 100% 80% 80% 70% 60% Improved consistency 60% 40% 50% FY15 FY16 FY17 FY18 FY19 (YTD) 20% Bontang Yarwun Mar Apr May Jun Jul Aug Sep Oct Nov D
Slide 9: 1. Continuous plants
1. Continuous plants Burrup update: short term challenges, fundamentals remain strong Strategic 30+ year asset • Plant located in the Pilbara region of Western Australia; strong 5-year growth in materials moved (i.e. strip ratio) • 50% JV with distinct responsibilities; Yara operates the plant, Oric
Slide 10: 2. Discrete plants
2. Discrete plants Global Initiating Systems network with latent capacity >20 plants globally • Key plants include: – Helidon, Queensland – Brownsburg, Canada – Gyttorp, Sweden • Products include: – Boosters, shock tube, detonators (electric, non-electric and electronic) and packaged explosives Sign
Slide 11: 2. Discrete plants
2. Discrete plants Rationalising and standardising IS manufacturing and supply chain PREVIOUS STATE TODAY AND FUTURE STATE BENEFIT • Manufacturing and Supply Chain • Minimise downtime related to managed as two independent • Regional Presidents own S&OP grade changes, reduce slow workflows process mo
Slide 12: 2. Discrete plants
2. Discrete plants IS product portfolio rationalisation simple example: booster In FY19 Current: 14 SKUs Sales 2018 Stock held catalogue Plan Target: <4 SKUs POSX8L0.5D 30 per case POSX8L0.5DA 0.5kg 35 per case POSX8L0.5D1 40 per case POSX8L500PE POSX8L1000 POSX8L1000PE 1.0kg 20 per case POSX8L1.0D
Slide 13: 2. Discrete plants
2. Discrete plants IS product portfolio rationalisation complex example: non-electric detonator DELAY SHELL TYPE CAP SHOCK TUBE TYPE LENGTHS & LENGTH TYPE & COLOUR Regular (9 SKUs) Orange (9 SKUs) Product Information MS (12 SKUs) 69mm (21 SKUs) XU (3 SKUs) Orange (3 SKUs) Product type Non-electric d
Slide 14: 3. Supply Chain
3. Supply Chain Driving change – an integrated supply chain PREVIOUS STATE TODAY AND FUTURE STATE BENEFIT • Lack of standardisation – organisation structure, business • Reduced management • Harmonise organisation design processes and performance complexity metrics • Supply plan providing full MANAGE