Alpek, S.a.b. De C.v. Class A · BMV:ALPEK/A
Alpek, S.a.b. De C.v. Class A — Alpek Sab De Cv Ord — Q1 2022 Earnings Presentation
25 slides from Alpek, S.a.b. De C.v. Class A's earnings presentation, Apr 25, 2022
Slide 1: First Quarter 2022 Earnings Webcast
FIRST QUARTER 2022 EARNINGS WEBCAST
Slide 2: Today's Speakers
TODAY’S SPEAKERS JOSÉ DE JESÚS VALDEZ JOSÉ CARLOS PONS ALEJANDRO ELIZONDO CEO CFO IRO 3
Slide 3: Topics for Today's Webcast
TOPICS FOR TODAY’S WEBCAST I. Financial Performance II. Octal Update III. Corporate Governance IV. 2022 Revised Guidance 4
Slide 4: Integrated PET Margins
INTEGRATED PET MARGINS Asian Margins | Px / MEG to PET (US$/Ton) China -3% 431 420 • Chinese reference margins 382 356 decreased by US$42/Ton QoQ 330 318 306 310 266 275 • Asian reference margins declined 250 242 323 223 260 328 PET by only US$11/Ton in 1Q22 184 262 227 249 228 196 159 192 172 175 •
Slide 5: Polypropylene Margins
POLYPROPYLENE MARGINS NA Polypropylene Margins | PP to PGP (cpp) -20% 52 47 • PP reference margins have begun 47 to normalize vs. 2021 highs 38 32 • Limited PP supply & high marine freight costs from Asia have kept 25 22 22 margins high 21 19 16 17 15 • New supply/demand balance still expected to re
Slide 6: EPS Margins
EPS MARGINS NA EPS Margin | EPS to Styrene (cpp) -13% 56 49 • EPS reference margins decreased 41 42 (-13% QoQ) in 1Q22 32 32 33 31 • Though EPS margins continue at 26 27 26 25 higher-than-historical levels 18 • Limited supply & high marine freight costs from Asia have kept margins high 2016 2017 201
Slide 7: 1Q22 Financial Highlights
1Q22 FINANCIAL HIGHLIGHTS • Solid first quarter volume of 1.2M tons (+4% QoQ) and on track with Guidance • Record-high Comparable EBITDA of US$333M (+11% QoQ) based on higher-than-expected reference margins mainly in PET and EPS • Dividend approved at Annual Shareholders’ Meeting and US$176 million
Slide 8: Volume Evolution
VOLUME EVOLUTION Quarterly Sales Volume (Ktons) +4% • Strong demand persists across all 1,230 1,201 1,216 1,195 1,172 product categories 234 254 P&C 256 271 240 • Overall quarterly volume remains in line with Guidance • Polyester volume up 3% QoQ as weather-related events of 4Q21 were avoided 996 94
Slide 9: Feedstock Costs
FEEDSTOCK COSTS Crude Oil & Paraxylene NA Propylene Contract Price NA Px Brent Contract US$/Bbl US$/Ton cpp 120 +23% 1,600 90 Crude Oil (Brent) Px 82 +21% 1,400 80 73 -4% • Brent crude oil price increased 100 70 67 66 (+23% QoQ) due to Russia-Ukraine 63 1,200 conflict 60 80 1,000 50 • Paraxylene pri
Slide 10: EBITDA Breakdown
EBITDA BREAKDOWN 1Q22 EBITDA (US$M) 456 -6 63 • Record Comparable EBITDA of +11% US$333M (+11% QoQ) 66 170 P&C 333 • Record Polyester Comparable 300 2 EBITDA of US$193M (+21% QoQ) as 142 reference margins strengthened 203 138 Others 17 • Record P&C Comparable EBITDA of US$142M (+3% QoQ) as EPS & PP
Slide 11: Free Cash Flow Generation
FREE CASH FLOW GENERATION Quarterly Free Cash Flow (US$M) 213 8 1,310 1,225 456 • Free Cash Flow of US$120M in 1Q22 74 40 due to strong EBITDA partially 30 offset by NWC 193 • Increase in Net Working Capital from higher raw material prices • Dividend payment of US$176M to shareholders approved & pai
Slide 12: Net Debt & Leverage
NET DEBT & LEVERAGE Net Debt (US$M) LTM EBITDA (US$M) Net Debt/EBITDA (Times) 1,323 1,310 1.9 1,219 1,247 1,225 1.7 1,092 1.6 962 1.3 813 1.2 733 657 1,277 1,077 1,145 1.6 977 1.3 1.2 778 1.1 1.0 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q21 3Q21 4Q21 1Q22 Comp. EBITDA Net Debt / Comp.
Slide 13: Octal Update
OCTAL UPDATE 14
Slide 14: Corporate Governance
CORPORATE GOVERNANCE • Partnering with leading companies to understand & implement world-class Governance practices • Improved disclosure ahead of Annual Shareholders’ Meeting • Share of female Board members raised to 17% • Share of independent Board members raised to 67% 15
Slide 15: 2022 Revised Guidance & Key Assumptions
2022 REVISED GUIDANCE & KEY ASSUMPTIONS Revised ’22 Original ‘22 Change 2021 Guidance Guidance (% vs. ‘21) Crude Oil US$/Bbl 100 81 70 43 MARKET Asia PTA/PET Margin US$/Ton 355 315 359 (1) MXN / USD (Avg.) MXN 21.3 21.3 20.3 5 Volume Ktons 5,000 5,000 4,798 4 Comparable EBITDA1 US$M 1,250 1,031 962
Slide 16: Q&A
Q&A JOSÉ DE JESÚS VALDEZ JOSÉ CARLOS PONS CEO CFO 17
Slide 17: Appendix
APPENDIX
Slide 18: Extraordinary Effects Breakdown
EXTRAORDINARY EFFECTS BREAKDOWN 2022 2021 Delta M dls 1Q 1Q 4Q 1Q 4Q Reported EBITDA 456 324 269 132 187 Inventory Adjustment (63) (63) 11 (0) (75) Carry-forward (66) (58) (6) (8) (60) Others 6 0 25 6 (20) Comparable EBITDA 333 203 300 130 33 19
Slide 19: Relevant References | Crude Oil
RELEVANT REFERENCES | CRUDE OIL Price increased as Russia-Ukraine conflict reduced global oil supply Brent Crude Oil Price US$/Bbl 140 120 97 100 80 70 60 40 21 20 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 20
Slide 20: Relevant References | Paraxylene
RELEVANT REFERENCES | PARAXYLENE Px prices increased in line with Crude Oil NA Px Contract Price (US$/Ton) +21% 1,297 1,174 1,033 1,066 1,069 954 996 876 876 891 658 685 590 2016 2017 2018 2019 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2020 2021 2022 21
Slide 21: Relevant References | Propylene
RELEVANT REFERENCES | PROPYLENE Propylene contract prices remained at similar levels to 4Q21 NA Propylene Contract Price | PGP (cpp) 82 -4% 73 67 66 63 54 45 39 41 34 35 31 26 2016 2017 2018 2019 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2020 2021 2022 22
Slide 22: Ocean Freight Prices
OCEAN FREIGHT PRICES Lower vessel availability & increased cost due to Russia-Ukraine conflict Asia – USA Spot Ocean Freight Rate (US$K/Container) +2% 10.7 10.8 11.0 7.2 4.7 4.8 3.9 2.5 2.8 2.6 2.8 2.8 2.1 2016 2017 2018 2019 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2020 2021 2022 23 Note: Prices based on 20-foot
Slide 23: For Additional Information
FOR ADDITIONAL INFORMATION Email: IR@alpek.com | Phone: +52 (818) 748-1146 ALEJANDRO • 11 Years at Alfa/Alpek • Alpek IRO / Corporate Finance Director since 2019 ELIZONDO • Previously held roles as Director of Logistics & Procurement at Indelpro, Director of Energy Markets IRO at Alfa, and Project L
Slide 24: Disclaimer
DISCLAIMER This presentation contains, or may be deemed to contain, “forward-looking statements”. By their nature, forward looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The future results of Alpek
Slide 25: First Quarter 2022 Earnings Webcast
FIRST QUARTER 2022 EARNINGS WEBCAST