Slide 1: Q3 and 9M 2022 Results Presentation
Q3 and 9M 2022 Results Presentationxx 3 November 2022 1
Slide 2: Disclaimer
Disclaimer This presentation ("Presentation") has been prepared by OCI N.V. (the "Company"). By accessing and reading the Presentation you agree to be bound by the following limitations: This Presentation does not constitute or form a part of, and should not be construed as, an offer for sale or sub
Slide 3: Table of Contents
Table of Contents Highlights Q3 and 9M 2022 Market Outlook Appendix Financial Performance 3
Slide 4: Safety First: Commitment to Zero Injuries
Safety First: Commitment to Zero Injuries OCI is committed to providing a safe and healthy workplace for all employees and stakeholders by implementing the highest international safety standards to avoid any potential risks to people, communities, assets or the environment Conversion intoQ4 FCF2019
Slide 5: OCI N.V. Overview
OCI N.V. Overview Leading global producer and distributor of hydrogen-based products providing low carbon Listing overview fertilizers, fuels, and feedstock, strategically positioned to capitalize on the energy transition • OCI N.V. is listed on Euronext Amsterdam (“OCI”, OCI Methanol Group “OCI NA”
Slide 6: Highlights
Highlights Adjusted EBITDA of $962 million in Q3 2022 (+92%) and $4.3 billion LTM. Net debt declined $377 million to $331 million as of 30 September 2022. Trailing net debt / adjusted EBITDA was 0.08x as of 30 September 2022 IFCo achieved 56% growth in own-produced DEF sales (663kt) and a total of 9
Slide 7: Market Cap + Net Debt + Cash Distribution
Market cap growth largely reflection of net debt Capital Allocation Priorities reduction despite much improved outlook Low net leverage combined with significantly improved market backdrop De-risked balance sheet and positioned for growth offers number of opportunities Cash distribution to sharehold
Slide 8: Texas Blue Ammonia Project
Texas Blue Ammonia Project Construction of New World-Scale Hydrogen-Based Blue Ammonia Facility in Texas Underway with Ground Breaking in December 2022 ✓ Recently announced a 1.1 mtpa blue ammonia plant in Texas, with infrastructure to double capacity to 2.2 mtpa ✓ Project is well underway with the
Slide 9: Table of Contents
Table of Contents Highlights Q3 and 9M 2022 Market Outlook Appendix Financial Performance 9
Slide 10: Q3 2022 Results
Q3 2022 Results Summary Key Financials1 and KPIs $ million unless otherwise stated Q3 '22 Q3 '21 %Δ 9M '22 9M '21 %Δ Revenue 2,330.4 1,537.3 52% 7,515.9 4,119.8 82% Own-produced sales volumes sold in Q3 ‘22 vs. Q3 ’21: Gross profit 871.3 272.7 220% 2,904.2 1,017.7 185% ➢ Nitrogen volumes increased 3
Slide 11: OCI records 38% growth in DEF volumes in 9M 2022
OCI records 38% growth in DEF volumes in 9M 2022 Attractive Fundamental Drivers for DEF Demand DEF is one of OCI’s fastest-growing products • Diesel Exhaust Fluid (DEF) is a combination of 32.5% urea and 67.5% de-ionized water. • 38% YoY growth in DEF volumes achieved in 9M 2022 by N-7, a marketing
Slide 12: Q3 2022 Net Revenue up 52% and Adj. EBITDA up 92% YoY
Q3 2022 Net Revenue up 52% and Adj. EBITDA up 92% YoY Own Produced Sales Volumes (million mt) Key Product Benchmark Prices ($/mt) Net Revenue ($m) Methanol Nitrogen +52% Urea Egypt Methanol US contract 2,330 0.3 0.3 +60% +6% 1,537 2.2 2.3 775 484 558 594 Q3 2021 Q3 2022 Q3 2021 Q3 2022 Q3 2021 Q3 20
Slide 13: Leading Position in Global Ammonia Markets and Flexible Business Model
Leading Position in Global Ammonia Markets and Flexible Business Model Segment Consolidated Revenues ($m) Segment Consolidated Adj. EBITDA ($m) OCI NV Gas Consumption by Region % of total consumption in Q3 2022 3,973 2,001 YTD 2021 YTD 2021 7% YTD 2022 YTD 2022 Q3 2021 Q3 2021 25% Q3 2022 Q3 2022 2,
Slide 14: Q3 2022 Free Cash Flow and Net Debt Build-up
Q3 2022 Free Cash Flow and Net Debt Build-up Reconciliation of Q3 2022 Reported EBITDA to Free Cash Flow 945 (97) (73) (12) (39) (26) (383) 392 78 Reported EBITDA Working Capital Maintenance Lease Payments Tax Paid Interest Paid Dividends Other Free Cash Flow Capex Paid to NCI Change in Net Debt fro
Slide 15: Table of Contents
Table of Contents Highlights Q3 and 9M 2022 Market Outlook Appendix Financial Performance 15
Slide 16: Nitrogen Outlook Supported by Attractive Supply-Demand Dynamics
Nitrogen Outlook Supported by Attractive Supply-Demand Dynamics Supporting Strong Pricing Outlook For H2 2022 and Beyond as We Recover From a 5-year Downturn Bull Market Drivers Support Demand Driven Environment Prior cycle (last 5-6 years) Next cycle (starting in 2022) CROP PRICES SUPPORTIVE OF FAR
Slide 17: Attractive Nitrogen Dynamics With Demand Expected To Exceed Capacity Additions
Attractive Nitrogen Dynamics With Demand Expected To Exceed Capacity Additions Ex-China urea capacity additions slow relative to 2015-19, Mt Merchant ammonia market structurally tightening Global ammonia net capacity additions and demand growth, ex-China ex-urea, Mt 22.9 Capacity additions Demand gr
Slide 18: Higher Costs for Marginal Producers Supportive of Nitrogen Prices
Higher Costs for Marginal Producers Supportive of Nitrogen Prices Global Feedstock Prices 2017-2023F, $/MMBtu Cash Costs per ton of Ammonia 2017-2023F, $/t 80 Rising global differentials between US, Marginal costs have escalated on high end of cost 70 North Africa and EU marginal costs 3,000 curve a
Slide 19: Methanol Market Fundamentals Are Supportive, with Significant Long-term Upside
Methanol Market Fundamentals Are Supportive, with Significant Long-term Upside Methanol spot and contract prices Methanol supply & demand balance tightening Methanol contract and spot US prices, USD per metric ton Methanol capacity vs. demand growth, Million Mt USGC Contract US Gulf Coast Contract L
Slide 20: Table of Contents
Table of Contents Highlights Q3 and 9M 2022 Market Outlook Appendix Financial Performance 20
Slide 21: Appendix: Q3 and 9M 2022 Results
Appendix Q3 and 9M 2022 Results 21
Slide 22: Reconciliation of adjusted EBITDA and adjusted net income
Reconciliation of adjusted EBITDA and adjusted net income Reconciliation of Reported Operating Income to Adjusted EBITDA $ million Q3 '22 Q3 '21 9M '22 9M '21 Comment Operating profit as reported 803.2 205.2 2,675.6 828.1 Depreciation, amortization and impairment 141.3 316.2 433.8 626.8 EBITDA 944.5
Slide 23: Reconciliation of EBITDA to free cash flow and change in net debt
Reconciliation of EBITDA to free cash flow and change in net debt $ million Q3 '22 Q3 '21 9M '22 9M '21 EBITDA 944.5 521.4 3,109.4 1,454.9 Working capital (96.8) (98.7) (246.7) (61.7) Maintenance capital expenditure (72.9) (64.6) (162.2) (150.0) Tax paid (39.0) (29.6) (178.5) (66.4) Interest paid (2
Slide 24: Appendix: Market Outlook
OCcI Appendix Market Outlook 24
Slide 25: Nitrogen Fertilizer Pricing Supported by Demand-Driven Environment
Nitrogen Fertilizer Pricing Supported by Demand-Driven Environment Strong support for nitrogen prices to reset above mid-cycle levels, given low global crop inventories, strong farm economics and higher marginal costs Urea, Ammonia, CAN and UAN Prices (Monthly Averages, 2011 – Q4 20221), $/t Demand-
Slide 26: Agricultural Fundamentals Supports Robust Nitrogen Demand at Least Until 2024
Agricultural Fundamentals Supports Robust Nitrogen Demand at Least Until 2024 Crop prices supported by stocks : use ratio at 10 year lows, Tight grain stocks for corn and wheat at further risk given dry requiring at least until 2024 to replenish weather and supportive of demand to rebuild stocks Cro
Slide 27: High Farm Incomes Supportive Of Demand
High Farm Incomes Supportive Of Demand 1 Supportive farm incomes in 22/23 : Farm operating margins (revenue above operating costs), USD/ha Farm margins are attractive in grain exporting regions as input costs have been offset by higher US Brazil Brazil France crop prices, incentivising farmers to pl
Slide 28: Lower Chinese Exports And Robust Indian Imports Supportive Of Nitrogen Prices
Lower Chinese Exports And Robust Indian Imports Supportive Of Nitrogen Prices • Chinese market balances supported by: Chinese Exports Curtailed on Domestic Demand and Closures – Government measures to curb exports until at least H2 China urea exports, Mt 2023 and prioritise domestic supply including
Slide 29: Methanol Uniquely Positioned as Alternative Fuel in Energy Mix
Methanol Uniquely Positioned as Alternative Fuel in Energy Mix ▪ Methanol is positioned as an economically advantageous fuel compared to alternatives Gasoline Blending Supported in the Americas Product pricing, converted to HHV, $/MMBtu ✓ Crude oil futures point towards oil prices of $85+/bbl for 20
Slide 30: Significant Incremental Ammonia Demand From New Clean Energy Applications
Significant Incremental Ammonia Demand From New Clean Energy Applications Clean Hydrogen is strongly positioned to lead the world’s energy transition, and ammonia is the key enabler ▪ Clean hydrogen use in energy applications will be a major contributor to emission reduction across industries where
Slide 31: Appendix: OCI: Strategic Positioning
Appendix OCI: Strategic Positioning 31
Slide 32: Ammonia and methanol are versatile and have a diverse set of end applications
Ammonia and methanol are versatile and have a diverse set of end applications Ammonia: End-Use Applications Examples Methanol: End-Use Applications Examples Ammonia is primarily utilized in fertilizers, but also supports a diverse With its diversity of applications – from paints and plastics, furnit
Slide 33: Fertiglobe Gas Contracts Overview
Fertiglobe Gas Contracts Overview Attractively Priced Fixed Gas Contracts Ensure Fertiglobe is Competitive Through the Nitrogen Cycle (1) Gas Supplier ADNOC GASCO(2) EGPC(2) Sonatrach Contract Start Date 2019 2005 - 2006 2008 2013 Contract End Date 2044 2030 - 2031 2028 2033 Annual Contract Volume 5
Slide 34: Fertiglobe Profit Sharing Mechanisms – Sensitivity to Product Prices
Fertiglobe Profit Sharing Mechanisms – Sensitivity to Product Prices Fertiglobe Has Profit Sharing Mechanisms that Provide the Egyptian and Algerian Governments with Greater Income Participation as Product Pricing Increases(1) Illustrative Impact of Product Prices on Reported EBITDA at Fertiglobe Fe
Slide 35: Flexible production capabilities to maximize returns
Flexible production capabilities to maximize returns Max. Proven Capacities¹ ('000 metric tons) Total Total Total2 Ammonia Ammonia Plant Country Urea UAN CAN Fertilizer Melamine4 DEF Nitrogen Methanol OCI NV (Gross) (Net)3 Iowa Fertilizer Company5 USA 926 195 438 1,832 - 2,465 - 1,019 3,484 - 3,484
Slide 36: For OCI N.V. investor relations enquiries contact
For OCI N.V. investor relations enquiries contact: Hans Zayed hans.zayed@oci.nl T +31 (0) 6 18 25 13 67 OCI N.V. corporate website: www.oci.nl