Icl Group Ltd. · TASE:ICL
Icl — Israel Chemicals — Q4 2014 Earnings Presentation
29 slides from Icl's earnings presentation, Feb 11, 2015
Slide 1: Q4 2014 Results
Q4 2014 Results Mr. Stefan Borgas | President & CEO February 11, 2015
Slide 2: Important Legal Notes
Important Legal Notes The information delivered or to be delivered to you does not constitute an offer or a recommendation to do any transaction in Israel Chemicals Ltd. (ICL) securities. Certain statements in this presentation and other oral and written statements made by ICL from time to time, are
Slide 3: Highlights & Financial Results
Highlights & Financial Results * Financial results y/y impacted by potash price decline and accumulating one-time effects Strategic milestones achieved: * Delivered efficiency improvement $100M in 2014, partially offsetting the impact of the labor interruption in Israel * Divestitures on track to ac
Slide 4: Business Environment & Major Developments
Business Environment & Major Developments * Strong potash volume year negatively impacted by labor actions in Israel in Q4 * Very satisfying phosphate performance supported by volumes, price increases and strong operating step-up * In Specialty Fertilizers, weak environment in Eastern Europe was str
Slide 5: ICL's Efficiency and Excellence Initiatives Contribution - 2014
ICL's Efficiency and Excellence Initiatives Contribution -- 2014 Efficiency initiatives contribution to operating income Contribution by project Contribution by segment [] Total efficiency and excellence initiatives contribution in 2014 - $100M [] Total annual contribution by 2016 Year End - $350M
Slide 6: Macro-Economic Developments Affecting ICL
Macro-Economic Developments Affecting ICL [] Excess costs in shekel - $1B in USD terms [] ILS/$ exchange rate today 10% lower than 2014 average [] Negative ILS/$ exchange rate impact on net income in 2014 will turn positive in 2015 [] Excess revenues in Euro -- $150M in USD terms [] []/$ exchange ra
Slide 7: 2014 - A Strong Fertilizer Year
2014 -- A Strong Fertilizer Year 2014 Imports to key markets - thousand tonnes 1 Full year phosphate fertilizers in P205 terms 2 Full year DAP imports Sources: China Fertilizer Weekly Market Report, Sindicaro Da Industria DE Adubose Corretivos Agricolas No Estado De Sao Paulo, GTIS, Fertilizer Week
Slide 8: Strategic Alliance with Yunnan Yuntianhua
Strategic Alliance with Yunnan Yuntianhua -- Supporting ICL's Fertilizers, Specialty Fertilizers, Food Specialties & Advanced Additives 1 50% in a fully vertically integrated phosphate business including a world scale phosphate rock mine and downstream operations -- with effective control 2 A 15% st
Slide 9: Strategic Alliance with Yunnan Yuntianhua: Financial Highlights
Strategic Alliance with Yunnan Yuntianhua Secure cost competitive resources for Asian markets Financial Highlights [] Revenues: JV sales to increase from ~$550M to ~$700M [] Commodity / Specialty sales volumes ratio to improve from 90%/10% to 50%/50% [] Margin expansion: expand EBITDA margins from l
Slide 10: Key Milestone in ICL's Food Strategy: Acquisition of Prolactal
Key Milestone in ICL's Food Strategy: Acquisition of Prolactal -- A leading European Producer of Dairy Proteins Transforming ICL Food Specialties into a global formulator of texture and stability solutions Deal highlights []2014 annual revenues of approx. []100 million, 200 employees []Market growth
Slide 11: Expand Footprint in Brazil: Acquisition of Fosbrasil
Expand Footprint in Brazil: Completion of 100% Acquisition Of Fosbrasil for ~$65M [] Latin America's main producer of purified phosphoric acid [] More than $100M in sales, 90 employees [] Benefits: [] Almost 50% increase of ICL's purified phosphoric acid volumes [] ICL to become South America's mark
Slide 12: Divestitures on Track to Achieve Net Proceeds $300-500M
Divestitures on Track to Achieve Net Proceeds $300-500M 2014 divestitures to generate more than $300M in net proceeds*: [] Total revenues of divested businesses in 2014 - about $350M with high single digit operating margin, lower than ICL's average [] Additional divestiture opportunities : [] Procee
Slide 13: Ethiopia - Potash for Growth
Ethiopia -- Potash for Growth Following positive results in India, ICL expands farmers' global education programs, launching "Potash for Growth" in Ethiopia to promote balanced fertilization to maximize agriculture productivity and to improve economic benefit. Outreach to farmers: 600 demonstration
Slide 14: Inauguration of ICL's European Headquarters in Amsterdam
Inauguration of ICL's European Headquarters in Amsterdam Benefits: [] $10-20M efficiency contribution annually [] Strengthening our business activities as well as our long-standing relationships with our European customers, suppliers and other stakeholders [] Excellent business and regulatory enviro
Slide 15: ICL Branding Website
ICL Branding Website Launched globally on Jan 27 Available in 7 languages! Demonstrates our vision and strategy The website offers: ICL "Minute to 8" video clips The thinking behind the brand story Branding examples & ICL brand book The brand's graphic and textual language ICL new site names search
Slide 16: Financial Results
Financial Results (Mr. Avi Doitchman)Executive VP, CFO & Strategy
Slide 17: Q4 2014 Results
Q4 2014 Results $ millions Q4 14 Q4 13 % change FY2014 FY2013 % change Revenues 1,403 1,416 (0.9)% 6,111 6,272 (2.6)% Operating Income 174 123 41.5% 758 1,101 (31.2)% Adjusted Operating Income 200 218 (8.3)% 960 1,196 (19.7)% Adjusted Operating margin 14.3% 15.4% 15.7% 19.1% Financial Expenses, net
Slide 18: Potash Bridge Analysis
Potash Bridge Analysis Sales ($M) Operating Profit ($M) Numbers may not add due to rounding
Slide 19: Phosphates and Fertilizers
Phosphates and Fertilizers Sales ($M) Operating Profit ($M)* Numbers may not add due to rounding * Q4 2013 operating income was impacted by a provision for early retirement in Rotem, in the amount of about $60M, while Q4 2014 operating income is excluding a one-time reimbursement of $8M from an insu
Slide 20: Industrial Products
Industrial Products Sales ($M) Operating Profit ($M) Numbers may not add due to rounding
Slide 21: Performance Products
Performance Products Sales ($M) Operating Profit ($M) Numbers may not add due to rounding
Slide 22: Thank You
Thank You
Slide 23: Appendices Financial Overview
Appendices Financial Overview
Slide 24: Lower, Yet Strong Returns
Lower, Yet Strong Returns 2000-2006 figures are based on Israeli GAAP, 2007-2014 are based on IFRS Data for 2012-2013 reflect the application of 2 new IFRS accounting standards Data is based on adjusted operating and net income ROE (Return on equity) = net income / shareholders' equity, average ROIC
Slide 25: Sequential Improvement in Cash Flow Delivery
Sequential Improvement in Cash Flow Delivery [] Net debt to EBITDA (as of end-2014): 1.98X * 2006 figures are based on Israeli GAAP, 2007-2014 are based on IFRS
Slide 26: More than a Decade of High Dividend Yields
More than a Decade of High Dividend Yields Year Dividend Yield* ---- --------------- 2001 4.0% ---- --------------- 2002 4.8% ---- --------------- 2003 4.5% ---- --------------- 2004 4.5% ---- --------------- 2005 3.6% ---- --------------- 2006 6.4% ---- --------------- 2007 3.5% ---- --------------
Slide 27: Macroeconomic and Industry Parameters Which Affected Q4 2014 Results
Macroeconomic and Industry Parameters Which Affected Q4 2014 Results (average Q4 2014 compared to average Q4 2013) Change ------------------------------------------- ----------------------------------- Depreciation of the NIS against the Dollar 8.7% ------------------------------------------- ------
Slide 28: Macroeconomic and Industry Parameters Which Affected 2014 Results
Macroeconomic and Industry Parameters Which Affected 2014 Results (average 2014 compared to average 2013) Change ------------------------------------------ ------------------------------------ Appreciation of the NIS against the Dollar -0.9% ------------------------------------------ ---------------
Slide 29: Thank You
Thank You SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Israel Chemicals Ltd. By: /s/ Avi Doitchman Name: Avi Doitchman Title: Executive Vice Presiden