Yara International Asa · OSL:YAR
Yara International Asa — Q1 2024 Earnings Presentation
27 slides from Yara International Asa's earnings presentation, Apr 26, 2024
Slide 1: Yara International ASA 2024 first-quarter results
Yara International ASA 2024 first-quarter results 26 April 2024
Slide 2: Cautionary note
Cautionary note This presentation contains forward-looking information and statements relating to the business, financial performance and results of Yara and/or industry and markets in which it operates. Forward-looking statements are statements that are not historical facts and may be identified by
Slide 3: Our ambition is zero injuries
Our ambition is zero injuries TRI1 (12-month rolling) 5.0 4.0 3.0 2.0 1.1 1.0 0.0 1Q16 1Q24 1) Total Recordable Injuries per 1 million working hours 3
Slide 4: 1Q EBITDA reflects increased deliveries and lower prices
1Q EBITDA reflects increased deliveries and lower prices 1Q 2024 EBITDA1 down 11% from 1Q23 mainly due to lower prices Total deliveries up 12% and European deliveries up 37% from 1Q23 Reduced GHG emission intensity with implementation of key projects Healthy demand growth and limited capacity additi
Slide 5: 1Q EBITDA 11% lower with increased deliveries offset by lower margins
1Q EBITDA 11% lower with increased deliveries offset by lower margins, higher fixed cost and lower other income EBITDA excl. special items (MUSD)1 ROIC2 105 -105 -5 -47 -Price/margin:- 425 -Energy cost4: + 320 Fixed costs: -20 487 435 3 1Q23 Volume/Mix Margin Currency Other 1Q24 5.7% 4.6% 1) EBITDA
Slide 6: Strong European nitrate and NPK premiums, down from exceptional levels
Strong European nitrate and NPK premiums, down from exceptional levels in 2022 and 2023 Strong NPK premiums1 in an historical context during first quarter Nitrate premiums2 back at historical levels Yara NPK premium (USD/t) Yara nitrate premium (%) Average premium 2019-21 Average premium 2019-21 162
Slide 7: Improved production and volume catch-up in Europe
Improved production and volume catch-up in Europe External deliveries 1Q 2023 vs 1Q 2024, in kt 1Q23 1Q24 Comments Europe deliveries up 37%, reflecting +13% a lower level of curtailments with improved production economics and volume catch-up despite volatile 5,253 pricing and weather challenges 4,
Slide 8: Reduced GHG emission intensity with successful implementation of key projects
Reduced GHG emission intensity with successful implementation of key projects and continued focus on operational excellence GHG emission intensity improvement continued in the first quarter On track to achieve the 2025 target L12M, tCO2e/tN Total project portfolio to reach the target: 90 projects
Slide 9: Financial performance
Financial performance EBITDA excl. special items1 EPS excl. currency and special items1 ROIC1 (MUSD) (USD per share) (12-month rolling, %) 487 435 0.40 20.1% 0.21 2.5% 1Q23 1Q24 1Q23 1Q24 1Q23 1Q24 Change in net operating capital2 Cash from operations Investments (net)3 (MUSD) (MUSD) (MUSD) 251 503
Slide 10: Results by segment
Results by segment 1Q23 1Q24 EBITDA excl. special items1 (MUSD) ROIC1 1Q ROIC1 L12M -5 -6.3% 15.2% Europe 28 -3.6% -9.8% 248 13.9% 24.1% Americas 171 8.4% 9.6% 70 6.7% 19.0% Asia & Africa 69 6.7% 2.9% 32 -3.5% 3.2% Global Plants 96 10.6% 3.1% 65 6.5% 20.9% Industrial Solutions 58 5.9% 6.1% 33 13.2%
Slide 11: Net debt increase due to seasonal increase in operating capital
Net debt increase due to seasonal increase in operating capital Net interest-bearing debt: 1Q development (MUSD) +263 (+7%) 3,953 3,690 56 280 317 244 Net debt end Cash earnings1 Net operating Investments2 (net) Other3 Net debt end of of last quarter capital change current quarter 1) Operating incom
Slide 12: Driving sustainable performance with an integrated scorecard
Driving sustainable performance with an integrated scorecard People Planet Profit 2025 2025 2025 Yara KPI 2021 2023 L12M Yara KPI 2021 2023 L12M Yara KPI 2021 2023 L12M target target target Strive towards zero GHG emissions, Ammonia 1.0 1.1 1.1 <1.0 3.0 3.0 2.9 2.7 7.8 7.8 7.8 8.6 accidents, TRI int
Slide 13: Yara Improvement Program (YIP)
Yara Improvement Program (YIP) Ammonia production1 (mt) Finished product production1 (mt) GHG emission intensity (t CO2e/tN) Stable performance in ammonia production Performance negatively impacted despite underlying improvement Reduced GHG emission intensity following successful project in several
Slide 14: Season-to-date Europe industry deliveries below pre-2022 levels
Season-to-date Europe industry deliveries below pre-2022 levels; stable year-over-year Total nitrogen deliveries in Europe1 Mt delivered in Europe in core countries Season-to-date industry deliveries 1Q industry deliveries 5.690 +1% 5.367 4.668 4.504 4.548 Avg L4Y +20% 2.053 2.024 1.754 1.448 1.467
Slide 15: Healthy demand growth and limited capacity additions support tighter markets
Healthy demand growth and limited capacity additions support tighter markets once new supply is absorbed Demand-driven pricing in 2023 despite Farmer incentives at healthy levels Project pipeline historically thin strong supply growth Trend growth rate 2013-2023: 1.9% per year Urea capacity addi
Slide 16: Yara is playing a leading role in tackling the food crisis and climate change
Yara is playing a leading role in tackling the food crisis and climate change while enabling the energy transition Focused strategy Profitable growth Strong shareholder returns Resilient and flexible business model Building on Yara’s leading ammonia Strong capital discipline maintained – position to
Slide 17: Appendix
Appendix
Slide 18: Free cash flow
Free cash flow Free cash flow before financing activities1,2 Divestment proceeds Investments Operations Free cash flow adjusted for divestment proceeds 2,104 1,669 1,973 1,560 1,091 863 1,442 1,298 1,246 532 619 1,142 284 288 105 -1,242 2018 2019 2020 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q2
Slide 19: Nitrate and NPK premiums
Nitrate and NPK premiums Nitrate premium above urea1 NPK premium above commodity blend2 USD/t (CAN27 equivalents) USD/t (NPK average grade equivalents) 1200 1200 CAN Yara realized NPK price Urea Egypt CFR proxy Commodity Blend -2M lag 800 800 400 400 0 0 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23
Slide 20: Key product price development
Key product price development 1Q23 1Q24 Urea price development1 (USD/t) Spot gas prices1 (USD/MMBtu) Yara realized CAN2 and NPK price3 (USD/t) -22% -25% 469 -19% 797 404 -60% 368 -39% 24.3 600 327 512 314 9.6 -32% 3.7 2.5 Urea granular Urea inland Europe (TTF) US (Henry Hub) CAN 27 Compound NPK FOB
Slide 21: Energy cost
Energy cost Quarterly averages for 2020 – 1Q 2024 with forward prices1 for 2Q and 3Q 2024 US gas price (Henry Hub) Yara Global TTF day ahead Yara Europe2 24.5 17.0 8.7 11.7 8.9 9.7 10.5 9.7 15.6 10.2 7.7 8.4 2.7 2.4 1.8 2.4 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4
Slide 22: Details of energy cost actuals and estimate 2Q and 3Q 2024
Details of energy cost actuals and estimate 2Q and 3Q 2024 Europe 2Q24 estimations based on 3Q24 estimations based on 2Q23 3Q23 4Q23 1Q24 forward prices forward prices Average gas cost USD/MMbtu 14.3 10.8 13.0 11.7 9.7 10.5 Gas consumption1 Million MMBtu 24.0 34.8 37.5 29.2 24.0 34.8 European gas co
Slide 23: Yara inventories
Yara inventories Finished products inventory development in mt 8 7 6 5 Other 4 3 Compound 2 NPK 1 Nitrates Urea 0 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 25
Slide 24: Peak of urea capacity additions is behind us
Peak of urea capacity additions is behind us Global urea capacity additions ex. China 1,2 (mt) India Russia Iran Algeria USA Nigeria Australia Others 6.7 6.2 5.5 4.9 4.4 4.8 4.5 4.2 3.2 2.4 1.9% average 1.5 historical 1.0 1.1 consumption growth3 0.1 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Slide 25: Farmer incentives: wheat example
Farmer incentives: wheat example Optimal nitrogen application1,2 kg/ha -2% 209 215 211 197 22/23 2H23 1 year ago current 22/23 2H23 1 year ago3 current3 Wheat price (USD/t) 309 251 247 220 CAN price (USD/t) 561 337 311 279 Optimal nitrogen application (kg/ha) 197 209 215 211 Grain yield (t/ha) 9.50
Slide 26: Alternative performance measures
Alternative performance measures Alternative performance measures are defined, explained and reconciled to the Financial statements in the APM section of the 1Q report on pages 22-29
Slide 27: Knowledge grows
Knowledge grows ; ae ee es : :