Slide 1: Q3 2023 Results Presentation
Q3 2023 Results Presentation 7 November 2023
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: 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 4: Executive Summary
Executive Summary Q3 ‘23 revenues $1.1 billion, adjusted EBITDA $242 million, adjusted net loss $95 million, consolidated net leverage 1.5x. Nitrogen outlook: • Nitrogen prices bottomed in late Q2 2023/early Q3 2023; ammonia and urea prices are now up ~150% and ~35% respectively from trough levels,
Slide 5: LTM in numbers
LTM in numbers $6.0bn revenue $1.6bn adj. EBITDA $1.6bn capital returned to shareholders 13.3m tons sold >4,000 employees 0.14 LTIR 2.37 GHG intensity 5 (1) LTM refers to last twelve months to Q2 2023
Slide 6: Turning Point with Strong Rebound in Nitrogen Prices & Demand
Turning Point with Strong Rebound in Nitrogen Prices & Demand Urea prices have increased by +$100/t from <$300/t levels in June towards ≈$400/t in Q3 and at the start of Q4 Rebound in nitrogen fertilizer prices Tightening supply balance Drivers Urea granular, FOB Egypt: recent price movement, $/t Y-
Slide 7: Q3 2023 Financial Summary
Q3 2023 Financial Summary Own Produced Sales Volumes (million mt) Key Product Benchmark Prices ($/mt) Methanol Nitrogen Urea Egypt Methanol US contract -44% 0.3 0.4 -12% 0.3 749 479 420 2.2 2.3 2.4 594 557 520 Q3 2021 Q3 2022 Q3 2023 Q3 2021 Q3 2022 Q3 2023 Q3 2021 Q3 2022 Q3 2023 Net Revenue ($m) A
Slide 8: Q3 2023 Free Cash Flow and Net Debt Build-up
Q3 2023 Free Cash Flow and Net Debt Build-up Reconciliation of Q3 2023 Reported EBITDA to Free Cash Flow ($ million) 230 (42) (112) (18) (17) (55) 11 (3) Reported EBITDA Working Capital Maintenance Capex Lease Payments Tax Paid Interest Paid Other Operating Free Cash Flow Change in Net Debt From 30
Slide 9: US Nitrogen Cash Conversion Consistently Among Highest in the Industry
US Nitrogen Cash Conversion Consistently Among Highest in the Industry IFCo achieves consistently higher EBITDA per nutrient ton and margins than US peers: US Midwest premium advantage Adjusted EBITDA margin, % IFCo cash conversion is among Adjusted EBITDA per nutrient metric ton highest in the indu
Slide 10: Establishing Green Methanol as the Low-Carbon Fuel of the Shipping Industry
Establishing Green Methanol as the Low-Carbon Fuel of the Shipping Industry OCI follows the safe arrival of the first ever green methanol powered container ship with another bunkering Arrival in Copenhagen, Denmark ❑ In September, OCI HyFuels, in partnership with Maersk, completed the world’s first
Slide 11: Methanol As a Marine Fuel continues to Accelerate
Methanol As a Marine Fuel continues to Accelerate Methanol marine orderbook is ramping up as a result of increasing interest from the bulker segment and retrofits. Current Confirmed Methanol DF Engines Orderbook Incremental Methanol Demand From Marine Fuels, Mt X # Total Global Fleet Other Bulk carr
Slide 12: Texas Blue Ammonia: On Track For Early 2025 and Ahead of Other Projects
Texas Blue Ammonia: On Track For Early 2025 and Ahead of Other Projects Milestones ❑ OCI’s 1.1 mtpa blue ammonia plant ✓ First greenfield blue ammonia facility of this scale to come onstream in the US and globally ❑ Well underway and in key construction phase: ✓ Over 600,000 manhours completed ✓ Civ
Slide 13: Capital Allocation
Capital Allocation Maintain as priority, target of <2x net leverage through the cycle ➔ Supporting our Investment Grade credit rating Balanced deployment of capital from strong through-the-cycle FCF1 Invest in growth Capital returns to shareholders Invest in hydrogen / energy transition and Base dis
Slide 14: Appendix – Markets
e Lara I Global Appendix — Markets 4
Slide 15: Nitrogen Markets Continued their Recovery in Q3 and are Tightening
Nitrogen Markets Continued their Recovery in Q3 and are Tightening Drivers Support Demand Driven Environment Prior cycle (last 5-6 years) Current cycle 30% 26% Corn stocks-to-use ratio 2022 corn stocks-to-use ratio HIGH CROP PRICES and AFFORDABILITY SUPPORT NITROGEN DEMAND and PRICE RECOVERY $3.7/bu
Slide 16: Robust Agricultural Fundamentals at least until 2025
Robust Agricultural Fundamentals at least until 2025 Crop prices supported by stocks:use ratio below 10-year average Urea affordability +26% since Q3 2022, supporting demand recovery Crop price index, Jan 2006 = 100 Global grain and oilseed stocks: use ratio (excl.-China), % Affordability Index, Jan
Slide 17: Constrained Chinese Exports & Robust Indian Imports Supportive Of Nitrogen Prices
Constrained Chinese Exports & Robust Indian Imports Supportive Of Nitrogen Prices Chinese Exports Curtailed on Domestic Demand and Closures Indian Imports Robust Despite New Capacity Commissioning China urea exports, Mt India imports, Mt India remains among top 3 urea 13.6 13.8 importers globally 10
Slide 18: Limited New Nitrogen Capacity, offset by Higher Demand
Limited New Nitrogen Capacity, offset by Higher Demand Slowdown of new urea capacity additions, with good visibility given ~5-year Merchant ammonia market expected to be underpinned by cost curve economics & project lead time impact of CBAM post-2026 Global urea net capacity changes and demand growt
Slide 19: Incremental Ammonia Demand From New Clean Energy Applications
Incremental Ammonia Demand From New Clean Energy Applications Accelerated demand growth potential post-2026 from new uses in power generation and marine fuels Outlook for incremental low-carbon ammonia demand by end-use to 2035, Million Mt Key Demand Drivers Emissions & carbon markets ~40 Mt 1 Devel
Slide 20: Ammonia Demand Snapshot
Ammonia Demand Snapshot Blue ammonia to dominate low-carbon NH3 market until 2030 due to higher cost for green / lack of concrete demand ❑ Market readiness = demand Blue Demand size (2030) Regulation Market readiness Green technology readiness, economic competitiveness High Existing uses - blue (EU)
Slide 21: Low Carbon Ammonia Supply Will Be Slow To Commission, OCI’s Texas Blue Ahead
Low Carbon Ammonia Supply Will Be Slow To Commission, OCI’s Texas Blue Ahead Only <15% of announcements get built given hurdles, and <30% of announced projects realized on time Firm nitrogen projects in 2008 pipeline, ex-China, Million Mt Similar trend in the US in 2014 – 2019: Low carbon ammonia 35
Slide 22: Elevated Costs for Marginal Producers Supportive of Nitrogen Prices
Elevated Costs for Marginal Producers Supportive of Nitrogen Prices Global Feedstock Prices 2017-2023F, $/MMBtu Cash Costs per ton of Ammonia 2017-2023F, $/t 80 Global differentials between US, North Africa and EU marginal costs remain wide 3,000 70 2,500 Arbitrage between international ammonia pric
Slide 23: Significant Upside for Methanol
Significant Upside for Methanol Prices rebound through Q3; US and EU rebound above Asia Methanol supply & demand balance tightening Methanol capacity vs. demand growth, Million Mt Methanol spot prices, USD per metric ton Methanol market outlook 2023 Capacity additions in structural deficit: are excl
Slide 24: Appendix – Select Hydrogen Growth Projects Overview
Appendix – Select Hydrogen Growth Projects Overview 24
Slide 25: A Global Nitrogen and Methanol Producer with State-of-the-Art Assets
A Global Nitrogen and Methanol Producer with State-of-the-Art Assets US 46% Europe 15% Middle East 39% IFCo IFCo - US Sorfert EFC & EBIC OCIN Fertil BioMCN Fertil - AD Natgasoline OCIB Natgasoline - US OCIB - US BioMCN - NL OCIN - NL Sorfert - AL EFC & EBIC - EG x% = 2022 Proportionate EBITDA4 by Ge
Slide 26: OCI Benefits From Structural Cost Advantages That Are Hard To Replicate
OCI Benefits From Structural Cost Advantages That Are Hard To Replicate Low-Cost Position Attributable to Advantageous Access to Feedstock, Young Age and Distribution Infrastructure ✓ Ammonia Global Cost Curve, FOB plant cash costs Y axis: Ammonia FOB costs in 2023, $/t ; X axis: Gross ammonia globa
Slide 27: OCI is at the Forefront of the Global Energy Transition
OCI is at the Forefront of the Global Energy Transition Our current portfolio comprises several sustainable & transformational growth projects Low-carbon ammonia UAE Texas Blue Ammonia Egypt Green Hydrogen Available sustainable solutions Select low-carbon ammonia & methanol projects • Green methanol
Slide 28: Linde to Supply Clean Hydrogen and Nitrogen to OCI’s Blue Ammonia Project
Linde to Supply Clean Hydrogen and Nitrogen to OCI’s Blue Ammonia Project ▪ Linde to supply 100% of facility's needs ▪ Linde's total investment ~$1.8 billion - Connected to US Gulf Coast H2 pipeline network Blue NH3 Nitrogen Ammonia (NH3) ▪ Linde signed an agreement with ExxonMobil in April for CO2
Slide 29: Carbon Footprint of Low Carbon Methanol & Ammonia
Carbon Footprint of Low Carbon Methanol & Ammonia Carbon Footprint of Green Methanol & Green Ammonia vs. Conventional Fuels on a Well-to-Wake basis, gCO2eq/MJ IMO revised strategy E- Ammonia ❑ On 7 July 2023, the IMO adopted a revised strategy, setting E-Methanol out stronger ambitions, to reduce to
Slide 30: Appendix
e Lara I Global Appendix 30
Slide 31: Q3 2023 Results
Q3 2023 Results Summary Key Financials1 and KPIs $ million unless otherwise stated Q3 '23 Q3 '22 %Δ 9M '23 9M '22 %Δ Strong operational performance across the platform Revenue 1,068.9 2,330.4 (54%) 3,812.3 7,515.9 (49%) Gross profit 173.9 871.3 (80%) 570.8 2,904.2 (80%) Own product sales volumes wer
Slide 32: Sales Volumes by Segment (1/2)
Sales Volumes by Segment (1/2) '000 metric tons Q1'23 Q2'23 Q3'23 Q1'22 Q2'22 Q3'22 Q4'22 FY 2022 Nitrogen US1 Own Product 415 681 454 502 593 494 676 2,265 Ammonia 16 65 25 4 47 6 89 146 Urea 42 23 26 12 10 7 10 38 UAN 182 411 219 260 319 262 323 1,164 DEF 175 181 185 226 218 219 254 917 Traded Thi
Slide 33: Sales Volumes by Segment (2/2)
Sales Volumes by Segment (2/2) '000 metric tons Q1'23 Q2'23 Q3'23 Q1'22 Q2'22 Q3'22 Q4'22 FY 2022 Methanol1 Own Product 247 501 503 370 417 401 369 1,557 Ammonia2 25 99 75 89 47 84 83 302 Methanol 222 402 429 282 370 317 286 1,255 Traded Third Party 143 119 116 144 74 78 109 405 Methanol 130 96 86 1
Slide 34: 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 '23 Q3 '22 Comment Operating profit as reported 64.5 803.2 Depreciation, amortization and impairment 165.3 141.3 EBITDA 229.8 944.5 APM adjustments for: Natgasoline 0
Slide 35: Financial Statements – Income Statement
Financial Statements – Income Statement Three-month period Three-month period Nine-month period Nine-month period $ millions Note ended 30 September 2023 ended 30 September 2022 ended 30 September 2023 ended 30 September 2022 Revenue (15) 1,068.9 2,330.4 3,812.3 7,515.9 Cost of sales (12) (895.0) (1
Slide 36: Financial Statements – Cash Flow Statement (1/2)
Financial Statements – Cash Flow Statement (1/2) Three-month period Three-month period Nine-month period Nine-month period ended 30 September 2023 ended 30 September 2022 ended 30 September 2023 ended 30 September 2022 $ millions Note Net profit / (loss) (74.7) 593.4 (60.1) 2,180.4 Adjustments for:
Slide 37: Financial Statements – Cash Flow Statement (2/2)
Financial Statements – Cash Flow Statement (2/2) Three-month period Three-month period Nine-month period Nine-month period ended 30 September 2023 ended 30 September 2022 ended 30 September 2023 ended 30 September 2022 $ millions Note Cash flow used in investing activities (202.4) (123.3) (536.0) (2
Slide 38: 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 3,483 - 3,483
Slide 39: Csi Global
Csi Global Csi Global