Slide 1: Results Presentation for the Year Ended 31 December 2022
RESULTS PRESENTATION FOR THE YEAR ENDED 31 DECEMBER 2022 1 MARCH 2023
Slide 2: Cautionary statement
Cautionary statement This document has been prepared and issued by and is the sole responsibility of the management of AECI Ltd (the Company) and its subsidiaries (the Group). This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer
Slide 3: Agenda
AGENDA Business results Financial performance Segment review Outlook and strategic priorities Questions and answers
Slide 4: Business results
OA=CI BUSINESS RESULTS
Slide 5: Our Operating context
Business results Financial performance Segment review Outlook and strategic priorities Q&A Our Operating context Unrelenting global and local Geopolitical tensions continue supply-chain challenges Pressure to reinvent Continued strong global businesses for the future commodity prices Water, energy a
Slide 6: 2022: A strong performance in general
Business results Financial performance Segment review Outlook and strategic priorities Q&A 2022: A strong performance in general Continued strong improvement in Health and Safety YOY substantial improvement in revenue, EBITDA and HEPS Strong foothold improvements in various new jurisdictions
Slide 7: Commitment to Zero Harm beyond compliance – record low TRIR of 0,15
Business results Financial performance Segment review Outlook and strategic priorities Q&A Commitment to Zero Harm beyond compliance – record low TRIR of 0,15 Best-ever safety performance Zero milestones OUR JOURNEY TO ZERO HARM Milestones 2022 2021 0.58 Fatalities 0 0 Life-altering injuries 0 0 0.4
Slide 8: On track against our 2025 sustainability targets
Business results Financial performance Segment review Outlook and strategic priorities Q&A On track against our 2025 sustainability targets ENVIRONMENTAL SOCIAL GOVERNANCE Key Achievements: Key Achievements: Key Achievements: Water consumption target Best ever safety performance Best practice
Slide 9: Strong growth, offset by operating environment volatility
Business results Financial performance Segment review Outlook and strategic priorities Q&A Strong growth, offset by operating environment volatility AECI Mining’s performance boosted by strong market share gains and export growth in mining chemicals AECI Agri Health benefited from continued stro
Slide 10: Financial performance
FINANCE FINANCIAL PERFORMANCE
Slide 11: Solid performance from core businesses despite Schirm Germany write off
Business results Financial performance Segment review Outlook and strategic priorities Q&A Solid performance from core businesses despite Schirm Germany write off Financial highlights PROFITABILITY Revenue EBITDA EBIT** EPS HEPS 37% 16% 0% 22% 15% 2022: R35 583m 2022: R3 570m 2022: R2 047m
Slide 12: AECI Schirm results
Business results Financial performance Segment review Outlook and strategic priorities Q&A AECI Schirm results Rm PPA AECI USA Germany and other Schirm AECI Schirm USA delivered to expectations EBIT excluding impairments of PPE 101 (228) (32) (159) Capacity expansion investment of R 504m (USD 31
Slide 13: AECI Schirm Germany turnaround
Business results Financial performance Segment review Outlook and strategic priorities Q&A AECI Schirm Germany turnaround THE FIVE TURNAROUND LEVERS ARE A Chief Transformation Officer hired – with 27 years restructuring experience in the region 1 Operations improvements A comprehensive turnaroun
Slide 14: AECI Much Asphalt update
Business results Financial performance Segment review Outlook and strategic priorities Q&A AECI Much Asphalt update Results impacted by reduced demand due to: delays in road infrastructure spending supply chain challenges and electricity shortages extreme weather conditions continued to impa
Slide 15: Once-off costs and increased finance costs impact earnings
Business results Financial performance Segment review Outlook and strategic priorities Q&A Once-off costs and increased finance costs impact earnings Summarised income statement Rm 2022 2021 % Revenue 35 583 26 053 37 Increased sales and global Operating expenses (33 536) (24 001) 40 commodity pr
Slide 16: Once-off costs impact earnings
Business results Financial performance Segment review Outlook and strategic priorities Q&A Once-off costs impact earnings Summarised income statement REVENUE (R m) EBITDA (R m) EBIT (R m) 18 096 8 529 7 067 2 342 2 018 1 743 358 765 257 212 (297) 562 Mining Water Agri Chemicals Mining Water Agri Che
Slide 17: Increase in inventory matched by higher short-term debt
Business results Financial performance Segment review Outlook and strategic priorities Q&A Increase in inventory matched by higher short-term debt Summarised statement of financial position Rm 2022 2021 % Increase in trade and other Assets receivables, primarily driven by Tangible assets 6 854 6
Slide 18: Continued elevated inventory levels driven by high commodity prices
Business results Financial performance Segment review Outlook and strategic priorities Q&A Continued elevated inventory levels driven by high commodity prices Working capital analysis R m and days 83 84 71 68 68 65 7 869 7 744 6 780 5 872 6 153 4 880 2021 2022 Inventories Trade and other receivables
Slide 19: Prices stabilised, albeit at elevated levels
Business results Financial performance Segment review Outlook and strategic priorities Q&A Prices stabilised, albeit at elevated levels Inventory movement 2021 to 2022 – R m 207 88 6 780 1 095 6 518 (63) (33) 606 4 880 Inventory Volume Price FX Inventory Volume Price FX Inventory 31 Dec 21 30 Jun 22
Slide 20: Gearing as expected
Business results Financial performance Segment review Outlook and strategic priorities Q&A Gearing as expected Net debt, gearing and cash movements Rm Gearing Gearing 24% 45% 3 840 (2 570) ( 334) ( 240) (2 760) ( 954) (1 453) ( 760) (5 345) ( 114) Net debt at Net cash Changes Other loans Net interes
Slide 21: Net debt increased – within covenant levels
Business results Financial performance Segment review Outlook and strategic priorities Q&A Net debt increased – within covenant levels Debt maturity profile and covenants Up to Payment profile (R m) 2023 2028 Total Group loan covenants Actual DMTN program 820 - 820 Net debt to EBITDA: <2.5 1.5 Term
Slide 22: Strong organic growth investment
Business results Financial performance Segment review Outlook and strategic priorities Q&A Strong organic growth investment Capital expenditure Rm 2022 strong focus on growth – major capex: 1 552 Mining Explosives R204m 3 x Bulk emulsion plants in Australia, Botswana and Chile Schirm Germany
Slide 23: We remain committed to returning value to shareholders
Business results Financial performance Segment review Outlook and strategic priorities Q&A We remain committed to returning value to shareholders Strong dividend track record Cents 774 685 570 570 515 8 7 6 6 5 505 580 366 414 470 149 156 100 180 194 Final Interim Dividend yield % 2018 2019 2020 202
Slide 24: 2023 Finance focus areas
Business results Financial performance Segment review Outlook and strategic priorities Q&A 2023 Finance focus areas 11 Deliver AECI Schirm Germany turnaround according to plan 22 Ongoing portfolio review and optimisation – margin and earnings improvement 33 Working capital management 44 Balance shee
Slide 25: Segment review
WF SEGMENT REVIEW Pe Tae ay ME i 5: ea fall in oa ee meee
Slide 26: Mining
MINING
Slide 27: Strong market share gains, export growth drive performance
Business results Financial performance Segment review Outlook and strategic priorities Q&A Strong market share gains, export growth drive performance AECI Mining Record performance REVENUE BY MINERAL MINED % Overall volume growth and revenue up supported by strong market share gains 14 20 ex
Slide 28: Solid operating model provides a platform for growth
Business results Financial performance Segment review Outlook and strategic priorities Q&A Solid operating model provides a platform for growth AECI Mining Mining Chemicals Mining Explosives Metallurgical chemicals Bulk volumes up 4.3% volumes up 7% Initiating systems volumes down 2.6% man
Slide 29: A leading global player poised for expansion
Business results Financial performance Segment review Outlook and strategic priorities Q&A A leading global player poised for expansion AECI Mining: Outlook Expect positive market development opportunities in Europe, Central Africa and LATAM for Mining Chemicals Latin America growth driven by ex
Slide 30: Water
WATER
Slide 31: Strong revenue growth, sales mix impacts margins
Business results Financial performance Segment review Outlook and strategic priorities Q&A Strong revenue growth, sales mix impacts margins AECI Water Strong revenue growth of 31% HISTORICAL REVENUE – FY 19 to FY 22 (Rm) market share gains in PW exports and improved SA demand increased sales t
Slide 32: Focus on leveraging technology loaded solutions for earnings growth
Business results Financial performance Segment review Outlook and strategic priorities Q&A Focus on leveraging technology loaded solutions for earnings growth AECI Water: Outlook Continued focus on margin improvement and working capital management initiatives, convert market share gains to profit
Slide 33: Agri Health
AGRI HEALTH
Slide 34: AECI Plant Health and Animal Health revenue and EBIT up
Business results Financial performance Segment review Outlook and strategic priorities Q&A AECI Plant Health and Animal Health revenue and EBIT up AECI Agri Health¹ AECI Plant and Animal Health Revenue up 19% and EBIT up 19% due to sustained higher commodity prices continued strong demand fa
Slide 35: Towards delivering a sustainable performance
Business results Financial performance Segment review Outlook and strategic priorities Q&A Towards delivering a sustainable performance AECI Agri Health: Outlook Focus on Improving margins Leveraging the AECI Schirm acquisition AECI Schirm Germany: key decisions taken, performance issues bei
Slide 36: Chemicals
CHEMICALS
Slide 37: Strong revenue growth and cash delivered
Business results Financial performance Segment review Outlook and strategic priorities Q&A Strong revenue growth and cash delivered AECI Chemicals Revenue significantly up by 32% EBIT impacted by margin pressure in industrial chemicals supply chain constraints muted road infrastructure spe
Slide 38: Regional champions in their local markets
Business results Financial performance Segment review Outlook and strategic priorities Q&A Regional champions in their local markets AECI Chemicals Specialty chemicals Pleasing performance with revenue and EBIT up 37% and 48%, respectively growth in oleochemicals, personal and homecare, coatings
Slide 39: Well positioned for growth
Business results Financial performance Segment review Outlook and strategic priorities Q&A Well positioned for growth AECI Chemicals: Outlook Focus on working capital release and cash generation Continue to expand product and service offering, mainly new products and agencies Continue with str
Slide 40: Outlook and strategic priorities
OUTLOOK AND STRATEGIC PRIORITIES
Slide 41: Outlook: Value creation is our priority
Business results Financial performance Segment review Outlook and strategic priorities Q&A Outlook: Value creation is our priority Deliver Zero Harm and ESG commitments in an integrated way as One AECI New business and market share gains expected to drive value across geographies capital inves
Slide 42: Thank you
ONE AECI, «2.0.0 % FOR A BETTER WORLD OA=CI
Slide 43: Q&A
OA=CI B. Q&A
Slide 44: Investor Relations
INVESTOR RELATIONS ZANELE SALMAN +27 11 806 8719 ZANELE.SALMAN@AECIWORLD.COM
Slide 45: Supplementary information
ONE AECI, |). FOR A BETTER WORLD OA=CI
Slide 46: Financial metrics
Business results Financial performance Segment review Outlook and strategic priorities Q&A Financial metrics 2018 2019 2020 2021 2022 EBIT margin 8.6% 8.2% 3.8% 7.9% 5.8% EBITDA margin 9.3% 10.6% 12.2% 11.8% 10.0% EPS 938 1 223 127 1 125 878 HEPS 1 045 1 150 880 1 116 1 287 Earnings yield 12.5% 10.7
Slide 47: Agri Health consolidation
Business results Financial performance Segment review Outlook and strategic priorities Q&A Agri Health consolidation Revenue EBITDA EBIT EBIT margin Working capital Plant and Animal Health 19% 19% 20% 6% 17% 2022: R4 906m 2022: R336m 2022: R306m 2021: R4 134m 2021: R284m 2021: R255m 2021: 6% 2021: 1