Slide 1: Full Year and Q4 2021 Results Presentation
Full Year and Q4 2021 Results Presentationxx 14 February 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: Transformational Year Reaping the Rewards of our Growth Strategy and Competitive Business Model
Transformational Year Reaping the Rewards of our Growth Strategy and Competitive Business Model Adjusted EBITDA of $1.0 billion in Q4 2021 (+291%) and $2.5 billion (+191%) for 2021 Net debt declined to $2.2 billion as of 31 December 2021, down from $3.0 billion at 30 September 2021. Trailing net deb
Slide 4: Table of Contents
Table of Contents H2 FY and Q4 2021 Market Outlook Capitalizing on the Appendix Financial Hydrogen Performance Opportunity 4
Slide 5: 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 6: FY and Q4 2021 Results: Accelerating earnings and strong FCF
FY and Q4 2021 Results: Accelerating earnings and strong FCF Summary Key Financials1 and KPIs $ million unless otherwise stated Q4’21 Q4’20 %Δ 2021 2020 %Δ Own-produced volumes sold were lower in Q4 ‘21 vs. Q4 ’20: Revenue 2,198.9 1,035.7 112% 6,318.7 3,474.1 82% Gross Profit 811.3 127.7 536% 1,829.
Slide 7: Q4 2021 Revenue Up 112% and Adjusted EBITDA Up 291%
Q4 2021 Revenue Up 112% and Adjusted EBITDA Up 291% Own-Produced Sales Volumes (Mt) Key Product Benchmark Prices, $/t Revenue ($m) +82% Methanol Nitrogen Urea Egypt Methanol US contract 6,319 1.9 +239% 1.7 +41% +73% +112% +66% 3,474 10.3 2,199 0.6 9.7 0.3 895 747 645 1,036 529 557 2.8 2.4 264 372 33
Slide 8: Strong balance sheet supports consistent capital returns to shareholders
Strong balance sheet supports consistent capital returns to shareholders Leverage targets achieved Capital Allocation Priorities Net Debt1 (US$ m) Net debt Net debt / adj. EBITDA OCI achieved its net leverage goals in 2021, which Deleveraging despite trough pricing allows a number of opportunities:
Slide 9: Capital allocation and new capital return policy
Capital allocation New capital returnpriorities policy Balance availability of funds and excess FCF for dividend distribution while pursuing value Committed to a consistent base distribution + a variable component accretive hydrogen / energy transition and linked to FCF generated1 other growth oppor
Slide 10: Q4 2021 Free cash flow and net debt build-up
Q4 2021 Free cash flow and net debt build-up Reconciliation of Q4 2021 EBITDA to Free Cash Flow 1,000 164 -75 -13 -65 -85 789 -172 36 EBITDA Working Capital Maintenance Lease Payments Tax Paid Interest Paid Dividends Other Free Cash Flow Capex Paid to NCI Change in Net Debt from September 2021 to De
Slide 11: Table of Contents
Table of Contents H2 FY and Q4 2021 Market Outlook Capitalizing on the Appendix Financial Hydrogen Performance Opportunity 11
Slide 12: Nitrogen outlook supported by attractive supply-demand dynamics
Nitrogen outlook supported by attractive supply-demand dynamics Supporting Strong Pricing Outlook For 2022 and Beyond as We Recover From a 5-year Downturn Bull Market Drivers Support Demand Driven Environment Prior cycle (last 5-6 years) 2022+ CROP PRICES SUPPORTIVE OF HIGHER AFFORDABILITY 30% 26% C
Slide 13: Agricultural fundamentals supports robust nitrogen demand at least until H2 2023
Agricultural fundamentals supports robust nitrogen demand at least until H2 2023 Crop Prices Supported by “Stocks : Use” Ratio at 7 Year Lows, Spot and Futures Crop prices supportive of strong fertilizer demand Requiring at Least Two More Growing Seasons to Replenish Corn and wheat prices, $ / bushe
Slide 14: 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 and net capacity additions ex-China ex-urea, Mt ✓ Demand growth expected to exceed supply growth
Slide 15: Supportive dynamics in China and India with Chinese urea export curtailments
Supportive dynamics in China and India with Chinese urea export curtailments to at least H2 2022 and robust Indian import demand • Chinese market balances supported by: Chinese Exports Curtailed on Domestic Demand and Closures – The government has implemented measures to China urea exports, Mt curb
Slide 16: 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, higher marginal costs and recovering industrial demand Urea, Ammonia, CAN and UAN Prices (Monthly Averages,
Slide 17: OCI records 13% growth in DEF volumes in 2021
OCI records 13% growth in DEF volumes in 2021 Attractive Fundamental Drivers for DEF Demand DEF is priced at a premium to urea and is one of OCI’s • Diesel Exhaust Fluid (DEF) is a combination of 32.5% urea and 67.5% de-ionized fastest-growing products water. DEF is used in Selective Catalytic Reduc
Slide 18: Methanol market fundamentals are supportive, with significant long-term upside
Methanol market fundamentals are supportive, with significant long-term upside Methanol prices supported by strong demand growth Methanol supply & demand balance tightening Methanol contract and spot US prices, USD per metric tonne Methanol capacity vs demand growth, Million Mt 700 77 USGC Contract
Slide 19: Higher costs for marginal producers supportive of prices
Higher costs for marginal producers supportive of prices Global Feedstock Prices 2017-2022F, $/MMBtu Cash Costs per ton of Ammonia 2017-2022F, $/t 45 TTF futures are ~$26/MMBtu for 2022 and Marginal costs have escalated on high end of cost 40 1400 c.$15/MMBtu in 2023/2024 curve and not expected to c
Slide 20: Table of Contents
Table of Contents H2 FY and Q4 2021 Market Outlook Capitalizing on the Appendix Financial Hydrogen Performance Opportunity 20
Slide 21: 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 22: Marine fuel represents a substantial market opportunity for OCI
Marine fuel represents a substantial market opportunity for OCI ▪ Ammonia and methanol are the only practical alternatives for long-distance shipping, even without decarbonization technologies, since they have a lower environmental footprint than HFO o Ammonia burns cleanest when used as energy sour
Slide 23: OCI is driving the hydrogen transition with many key initiatives underway
OCI is driving the hydrogen transition with many key initiatives underway Numerous strategic partnerships with industry leaders and lower Projects being explored or carbon projects being developed across our global asset base 12+ developed in Europe Selected examples: FUREC Waste-to-Hydrogen: partne
Slide 24: Table of Contents
Table of Contents H2 FY and Q4 2021 Market Outlook Capitalizing on the Appendix Financial Hydrogen Performance Opportunity 24
Slide 25: Appendix: FY and Q4 2021 Results
Appendix FY and Q4 2021 Results 25
Slide 26: 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 Q4 ‘21 Q4 ‘20 2021 2020 Adjustment in P&L Operating profit as reported 734.7 56.4 1,562.8 187.0 Depreciation and amortization 264.8 153.5 891.6 592.2 EBITDA 999.5 209.9
Slide 27: 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 Q4'21 Q4'20 2021 2020 EBITDA 999.5 209.9 2,454.4 779.1 Working capital 163.5 229.2 101.8 143.5 Maintenance capital expenditure (75.4) (50.4) (225.4) (239.4) Lease payments (13.0) (12.9) (47.3) (45.9) Tax paid (64.8) (12.5) (
Slide 28: Appendix: About OCI
OcI Appendix About OCI 28
Slide 29: Nitrogen production capacity and commercial footprint
Nitrogen production capacity and commercial footprint Nitrogen Footprint Iowa Fertilizer Company (IFCo) - Iowa, US Egyptian Fertilizer Co (EFC) – Egypt ▪ Production and sales ▪ Acquired: 2008 started April 2017 Product ktpa Product1 ktpa Urea 1,714 Ammonia (net) 195 DEF 350 UAN 1,832 Urea 438 DEF 1,
Slide 30: Methanol production capacity and commercial footprint
Methanol production capacity and commercial footprint United States Global OCI Beaumont (Texas, US) OCI Methanol Marketing Product ktpa ✓ Wholly owned subsidiary marketing OCI’s 3.0Mt of methanol Methanol 1,0041 Ammonia 356 portfolio globally ✓ The distribution platform’s global footprint and distri
Slide 31: 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 32: 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