Slide 1: Full Year Results Announcement
Full Year Results. _ Announcement 3) November 2004
Slide 2: Presentation - Outline
Presentation - Outline Results forthe year Co _ ended 30 Sept 2004 _ Malcolm Broomhead _ . . Strategy | — —rrt—“O—O—O——C—C* | c. Business Performance - . - ‘Financial Position _
Slide 3: Financial Summary
Year Ended 30 September FINANCIAL SUMMARY 2004 2003 % Change Underlying Results: NPAT (excluding significant items) Asm =. 326 270 20% EBIT (excluding significant items) Asm 553 442 25% Results including significant items: Significant items after tax ASM 2 (169) >100% NPAT including significant item
Slide 4: Significant Items
Year Ended 30 September Significant Items (A$M) 2004_ 2003 Qenos Botany Losses - ( 16) Write-off - (123) - 39) Legacy Issues Botany groundwater provision ( 46) ( 28) Surplus property sales 39 32 (7) 4 Restructuring and Rationalisation Restructuring costs ( 16) (34) Asset impairment (12) - ( 28) ( 34
Slide 5: Financial Summary - Returns to Shareholders
Year Ended 30 September FINANCIAL SUMMARY 2004 2003 %change Results (before significant items) Earnings per share cents 119.0 97.2 22% Return on shareholders’ funds % 23.1 19.6 18% Results (after significant items) Earnings per share cents 119.8 36.2 231% Return on shareholders’ funds % 23.3 7.3 219
Slide 6: ORICA - How We Approach Things
ORICA - How We Approach Things ¢ Efficiency ¢ Culture _ PERFORMANCE DRIVERS ©
Slide 7: Orica — simple strategy, superior results
Orica — simple strategy, superior results Bolt on acquisitions and ET oo raphic expansion Plant expansions that ME Meet IRR 15% & 18% RONA minimum __ | Growth in ™ | earnings Organic growth and productivity gains will generate significant free cash uymoib punj 0} palidde uses aai4 _ oe ABOVE AVERAGE
Slide 8: Orica - Where do growth opportunities lie?
Orica - Where do growth opportunities lie? Mining Services Chemicals « New geographies + Leverage off existing acquisitions * Plant expansions * Organic and acquisitive growth * Commercialisation of new * Organic growth , technologies Consumer Products Fertilisers « Further category expansion + Capt
Slide 9: Orica - recent growth scorecard
Orica - recent growth scorecard A$M 2003 2004 = Total Geographic expansion 23 23 Plant expansion 57 124 181 Category expansion 45 45 Mergers and acquisitions 446 158 604 Ms S =* 548 305 G53; ss ii $800M+ funds committed to growth in past two years
Slide 10: Orica - our vision
Orica - our vision Orica turns science into solutions for our customers and our vision is to be the best performing science- based solutions company in the world. Our vision will be achieved by: — securing market leadership positions in niche markets which build on our strengths and create economic
Slide 11: ORICA - Our Approach
ORICA - Our Approach ¢ Strategy _ PERFORMANCE DRIVERS © 11
Slide 12: Cost Efficiency
Year Ended 30 September COST EFFICIENCY 2004 $M Sales revenue 4,611 Variable costs 2,717 Cash fixed costs 1,230 Depn & amort 171 Whole of cost bar 4,118 (WOCB) WOCB/sales 89.3% 2003 $M 3,959 2,297 1,073 176 3,546 89.6% Increase $M % 653 16.5% 420 157 (5) 572 16.1% YEAR ON YEAR IMPROVEMENT IN COST AS
Slide 13: Capital Efficiency
Year Ended 30 September CAPITAL EFFICIENCY Disciplined capital management: ¥ working capital Productivity: v Yarwun ¥ Kooragang Island ¥ ChlorAlkali plants Share Buyback: v 5% on market buyback completed v¥ New on market buyback announced - up to $250M 13
Slide 14: Sustenance Capital
Year Ended 30 September SUSTENANCE CAPITAL Sustenance spend A$M 160 120% “ + 100% 120 + 80% 100 80 60% ° + 40% 40 + 20% 20 0 0% FY01 FY02 FY03 FY04 Sust as % of depn RE-INVESTING IN EXISTING ASSETS 14
Slide 15: ORICA - Our Approach
ORICA - Our Approach Strategy Efficiency PERFORMANCE DRIVERS tw 15
Slide 16: ORICA - Our Culture
ORICA - Our Culture © SH&E - Commercial Ownership - Creative Customer Solutions - Working Together ___DELIVERTHEPROMISE 16
Slide 17: Business Performance | Cash Flow | Financial Position
Business Performance | Cash Flow : _ a _ - Financial Position 17
Slide 18: Financial Results - NPAT
Year Ended 30 September FINANCIAL RESULTS - NPAT 2004: Sales $4.6B, NPAT* $326M 350 25% 300 + 20% 250 200 P 15% NPAT (A$M) + 10% + 5% 0% 01 02 03 04 ROSHF ANOTHER RECORD RESULT * pre significant items/abnormals
Slide 19: NPAT Analysis
LAK KK Year Ended 30 September NPAT ANALYSIS 370 7 13 — >» i | | 350 7 7 330 | 23 | Oo _ = © 8 * 310 + 34 326 290 + 270 + 250 270 5 9 = a = a 9 eg ® a8 3 3 6 © gS e 23 a ao 2 Oo o £ ® g 2 Sa & S P g 2 = 2 2° 3 gee 0 = #0 35 §& S o & 4 ge S t a = Underlying business improvement x — Increased expendit
Slide 20: Mining Services
Mining Services Sales $1,734M; EBIT $270M; Net assets $1,086M; RONA 25% 300 18 400 4 16 47 (81) 250 48 360 | ™ = 200 2% 320 70 3 to & = ra 180 8 = 280 ms = 100 6 E (1) © a9 4 i 240 + 247 °° | 2 200 = > FSF eT ° - t 2001 2002 2003 2004 b 23 23 $ <8 23 ce ce) i a@ &8& FS &@ S$° 6" 2B g & . 5 Ww a o 4
Slide 21: Fertilisers
Fertilisers Sales $1,136M; EBIT $104M; Net assets $674M; RONA 15% 120 0 4 Q 400 8 80 7 60 8 5 40 4 ° |e 2 a , ; 2001 2002 2003 2004 -20 0 Miafirst half ebit second half ebit — EBIT MARGIN EBIT MARGIN % 00 aa = (12) @) 404 EBIT FYG3 Efficiencies Pivot Price Volume Parafield gardens EBIT FY04 v¥ Merge
Slide 22: Consumer Products
Consumer Products Sales $772M; EBIT $100M; Net assets $217M; RONA 50% 120 100 80 60 EBIT $M 40 oH 0 T T T 2001 2002 2003 2004 maafirst half ebit second halfebit —- EBIT MARGIN EBIT MARGIN % 105 3 (3) 100 7 i mE & os 1 | 100 90 (7) 85 89 80 8 o o 2 % s 3 5 i € 8 x 5 Ss FE @ gE g a 6 6 ed — a 5 3 > =|
Slide 23: Chemicals
Chemicals Sales $1,063M; EBIT $114M; Net assets $760M; RONA 18% EBIT MARGIN % 420 44 100 42 80 > a, 40 FA 8 5 60 i 6 40 4 0 r r is) 2001 2002 2003 2004 Mma first half ebit second halfebit —- EBIT MARGIN 120 poe. We _ i = 100 $M 3 | 114 90 EBIT FY03 Price Volume Pop'n Miex Growth fund Other EBIT Fyo4
Slide 24: Other Operations, Corporate Centre and other
Other Operations, Corporate Centre and other Support Services (Asm) 2004 2003 $ Change ¥ Ceased equity accounting Qenos in March 2003 ¥ Sold Crop Care Other Operations Qenos - (11.2) 11.2 Crop Care - (2.3) 2.3 - (13.5) 13.5 Corporate Centre (26.8) (23.2) (3.6) Other Support Costs (7.3) (6.9) (0.4) (
Slide 25: Cashflow
Year Ended 30 September CASHFLOW 2004 2003 Change EBITDA 724 =618 106 Net operating cash flows 588 500 88 Net investing cash flows (381) (385) 4 Net financing cash flows (144) (166) 22 63. (51) «+114
Slide 26: Balance Sheet
Year Ended 30 September BALANCE SHEET Sept March Sept 2004 2004 2003 Trade working capital 767 751 671 Net property, plant & equipment 1,518 1,450 1,437 Net other assets 330 363 350 Net debt (977) (1,029) (877) Net Assets 1,638 1,535 1,581 Orica shareholders’ equity 1,429 1,338 1,385 Outside equity
Slide 27: Net Debt, Gearing and Interest Cover
° ° Net Debt, Gearing and Interest Cover 1200 - 1100 - 1000 - 900 - Net debt (ASM) 800 | 700 5 New Target Range 45% - 40% ; 35% - 30% + 25% - 20% - 15% + 10% + 5% 0% 600 HY01 FY01 HY02 FY02 HY03 FY03 HY04 FY04 Gearing Gearing 37.4%, Interest cover 7 new target gearing range of 35 - 45% .7 times. Tar
Slide 28: Conclusion
CONCLUSION Continued underlying profit improvement ¢ Healthy “balance sheet” plus strong coverage ratios __ STRICT FINANCIAL DISCIPLINE _ 28
Slide 29: Full Year Summary - Comments on 2005
/ FULLYEAR SUMMARY COMMENTS ON 2005
Slide 30: Summary
SUMMARY Net profit after tax (up 20%) — Grown revenue — Reduced cost as % of sales * Results demonstrates strength of Orica businesses * Further growth of our existing businesses * Improved returns for shareholders — record dividend — on-market buy-back (5% completed and further $250M announced) _ D
Slide 31: Outlook - 2005
OUTLOOK - 2005 * Continued strong earnings momentum (subject to normal caveats around the timing and extent of rainfall and general economic conditions) driven by: — ongoing improvements in our businesses — full year earnings from acquired businesses — recent ammonium nitrate plant expansions offset
Slide 32: Questions and Answers
Slide 33: Full Year Results Announcement
Full Year Results. _ Announcement 3) November 2004
Slide 34: Supplementary Information
"Supplementary Information
Slide 35: Foreign Currency - Risk Management
FOREIGN CURRENCY- Risk Management Derivative Typical use Instrument A§ call options Exposures greater than 12 months Foreign exchange Exposures less than contracts 12 months INSURANCE APPROACH _~
Slide 36: Foreign Currency - Snapshot
FOREIGN CURRENCY- Snapshot A$ Call Options: Hedging of USD Exposure (as at 30 September 2004) Offshore Business Manufactured Hedge Sales Nitrogen Product | | Premium Year Cover Strike Cover Strike expense ASM Rate A$M Rate A$M 2005 96 62 cents 73 68 cents 6 2006 54 67 cents 44 68 cents 5 2007 35 68
Slide 37: Foreign Currency - Sensitivity
FOREIGN CURRENCY- Sensitivity Assuming a AUD/USD exchange rate of 72 cents every one cent movement in the exchange rate will impact EBIT: 2005 +/- $1M 2006 +/- $1M to $2M 2007 +/- $2M to $3M ACTIVE RISK MANAGEMENT 37