K+s AG · XETR:SDF
K+s — K+S Aktiengesellschaft — 6th German Corporate Conference (Cheuvreux) 2007
44 slides from K+s's conference presentation, Jan 15, 2007
Slide 1: Experience growth. 6th German Corporate Conference
K+S Group Experience growth. 6th German Corporate Conference Cheuvreux Frankfurt am Main 15 January 2007 January 2007 K+S Group 0
Slide 2: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 1
Slide 3: Corporate Structure
K+S Group Corporate Structure K+S Group Revenues EBIT I Potash and Magnesium Products 1,197.2 151.8 Core business fertilizers and COMPO 541.7 25.0 plant care fertiva 568.3 14.8 Core business Salt 398.0 62.7 salt Waste Management and Recycling 56.0 8.1 Complementary businesses Services and Trading 54
Slide 4: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 3
Slide 5: Fertilizer Business
K+S Group Fertilizer Business z Global food production has to increase despite decreasing availability of arable farm land worldwide (steadily increasing world population, rising qualitative demand) z As a consequence fertilizing with key nutrients nitrogen (N), phosphate (P) and potash (K), but als
Slide 6: Yields of Cereals in Selected Regions
K+S Group Yields of Cereals in Selected Regions dt/ha 70 60 50 40 30 20 10 0 North America Latin America Western Europe Eastern Europe South Asia Far East Africa Source: FAO 1980 1985 1990 1995 2000 2004 z Highest yields of cereals per hectare to be found in Western Europe and in North America thank
Slide 7: Meat Consumption per Capita
300 K+S Group Meat Consumption 250 per Capita 200 kg / person 150 North America 100 South America 50 Asia Africa 0 1961 1970 1980 1990 2002 source: Food and Agriculture Organization of the United Nations (FAO) z Rising prosperity goes along with rising meat consumption z Production of 1 kilogram of
Slide 8: World Production/Demand of Cereals and Corn
K+S Group World Production/Demand of Cereals and Corn Production, consumption, stocks of cereals Production, consumption, stocks of corn 120 40 70 50 30 40 80 50 30 20 30 20 40 m illion to n n e s m illio n ton n e s 10 10 10 0 0 0 % % -10 -10 -10 -40 -30 -20 -20 -30 -80 -50 -30 -40 -120 -40 -70 -50
Slide 9: Rising Prices of Agricultural Products
K+S Group Rising Prices of Agricultural Products Index: January 2005 = 100 z Agricultural output cannot keep 180 Corn up with demand 170 Wheat +71% Palm oil z Low worldwide inventories 160 of agricultural products Soybeans 150 z Increasing demand of 140 +37% renewable raw materials 130 +36% Î Fertil
Slide 10: World Potash Production and Demand by Region
Potash and Magnesium Products World Potash Production and Demand by Region Million tonnes 18.7 20.0 23.9 10.7 8.4 7.4 4.0 8.0 7.9 1.5 0.5 World potash production: World potash sales: incl. sulphate of potash 2005: 56.6 million t 2005: 54.4 million t and low grade potash 2004: 54.0 million t 2004: 54
Slide 11: Supplier Structure on the World Potash Market
Potash and Magnesium Products Supplier Structure on the World Potash Market 32.3% 24.4% 12.4% 9.1% 8.9% 8.0% 3.3% 1.6% zMosaic Belarus- z K+S ICL Silvinit APC SQM Others zPCS kali Group: participation participation China, of PCS of PCS Intrepid, zAgrium Uralkali z zDSW CVRD, Canpotex BPC zIberpotash
Slide 12: World Potash Capacity, Production and Demand
Potash and Magnesium Products World Potash Capacity, Production and Demand Million tonnes Technically available Capacity z The shortfall of Eastern European (incl. announced capacity expansions) demand after the collapse of the 70 Production Soviet Union was more than (incl. announced capacity expan
Slide 13: MOP Prices for Selected Markets
Potash and Magnesium Products MOP Prices for Selected Markets Overseas Northwest Europe US$/t (standard, cfr) US$/t (standard, fob) 250 180 165 225 Thailand/Taiwan 215 165 Brazil 200 150 189 175 135 150 120 125 105 100 90 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 2003 2004 2005 2006 2003 2004
Slide 14: Potash and Magnesium Products
K+S Group Potash and Magnesium Products 9 months Financial year Revenues by product group € million 2006 2005 2005 2004 2005 Revenues 943.3 880.0 1,197.2 1,031.2 (in %) EBIT I 123.0 114.8 151.8 71.2 Brief description Crude potash and magnesium salts are extracted from six mines in Germany and form t
Slide 15: COMPO
K+S Group COMPO 9 months Financial year Revenues by segment € million 2006 2005 2005 2004 2005 Revenues 435.5 433.9 541.7 525.1 (in %) EBIT I 25.6 24.2 25.0 23.9 Brief description Consumer business: high-quality branded products such as potting soil, plant care products, lawn and garden fertilizers.
Slide 16: COMPO - Market Entrance Consolidated
COMPO COMPO - Market Entrance Consolidated z New plant protection products thanks to cooperation with Syngenta - “COMPO Axoris Insekten-frei“ to be introduced at the beginning of 2007 - Four further new developments based on Syngenta substances and 13 new formulae pending approval z Further developm
Slide 17: fertiva
K+S Group fertiva 9 months Financial year Revenues by product group € million 2006 2005 2005 2004 2005 Revenues 413.6 428.8 568.3 513.8 (in %) EBIT I 14.6 13.2 14.8 10.1 Brief description fertiva represents the K+S Group’s nitrogen fertilizer activities. It markets the agricultural fertilizers produ
Slide 18: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 17
Slide 19: Salt
K+S Group Salt 9 months Financial year Revenues by product group € million 2006 * 2005 2005 2004 2005 Revenues 340.9 276.4 398.0 357.8 (in %) EBIT I 55.6 45.3 62.7 56.7 * since 1 July including SPL Brief description Salt products of highest purity and quality are used as table salt, industrial salt,
Slide 20: Main Crystallized Salt Suppliers Worldwide
Salt Main Crystallized Salt Suppliers Worldwide Production / supply for third parties in million tonnes 18.7 12.6 12.5 12.5 11.9 6.4 7.3 7.3 6.1 4.1 3.9 3.6 CNSG Morton Compass Cargill Dampier ESSA Salins SWS Akzo Salt Minerals Salt Group (China) (USA) (USA) (GER) (USA) (AUS) (MEX) (F) (GER) (NL) ba
Slide 21: SPL: Salt Extraction in the Atacama Desert
Salt SPL: Salt Extraction in the Atacama Desert January 2007 K+S Group 20
Slide 22: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 21
Slide 23: K+S is the Leading Player in its Markets
K+S Group K+S is the Leading Player in its Markets Fertilizers and Plant Care: One of the leading suppliers worldwide Potash z Leader in Europe z Fourth-largest producer worldwide Sulphate of potash and magnesium sulphate z Leading position in the World The green market z Leader in Europe with COMPO
Slide 24: Strategy
K+S Group Strategy z Consolidation and selective expansion of our leading market positions, particularly with regard to specialities z Further development of our core business sectors through acquisitions and cooperation arrangements z Ongoing focus on improving efficiency and cutting costs as well
Slide 25: Outlook for the Year 2006
K+S Group Outlook for the Year 2006 (as of 7 November 2006) z Increase of global potash demand; stabilisation of international price level z Financial consolidation of SPL (revenues a good 100 million €; EBIT I between 12 and 15 million €; normal de-icing business at esco and SPL for Q4 assumed) z E
Slide 26: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 25
Slide 27: Development of Revenues, Earnings and Cash Flow
5.000 500 K+S Group 4.500 450 Development of Revenues, Earnings and Cash Flow 4.000 400 € million € million 3.500 3,500 350 CAGR 6.2% 2,942 CAGR 17.7% 3.000 3,000 300 273 2,500 2.500 250 2,179 CAGR 8.4% 2,000 2.000 200 177 1,500 1.500 150 CAGR 9.3% 121 118 106 1,000 1.000 100 68 500 50 0 0 ‘02 ‘04 ’
Slide 28: Dividends and Share Buybacks (10 Years)
K+S Group Dividends and Share Buybacks (10 Years) 150 2,50 € million € per share Dividend per share (rhs) (for the previous financial year) 120 Share buybacks (lhs) 2,00 2.00 66.70 1.80 Total dividend payment (lhs) (for the previous financial year) 90 69.36 1,50 1.50 1.30 43.38 1.00 1.00 1.00 74.25
Slide 29: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 28
Slide 30: K+S Share Price Compared with DAX and MDAX
K+S Aktiengesellschaft K+S Share Price Compared with DAX and MDAX Performance of K+S share Market capitalisation (Index: 31 December 2005 = 100) (€ million) 160 150 K+S +48% 3,391 -270 3,121 140 +1,285 130 MDAX +29% 2,106 120 DAX +22% 110 100 90 Jan. 2006 Jan. 2007 2005 2006 2007 31 Dec. 31 Dec. 05
Slide 31: K+S Share Price Compared with Peer Group
K+S Aktiengesellschaft K+S Share Price Compared with Peer Group Index: 31 December 2005 = 100 190 180 170 PotashCorp +71% 160 K+S +48% 150 140 Yara +40% 130 Mosaic +39% 120 110 100 90 80 70 Jan. 2006 Jan. 2007 source: Bloomberg; as of 5 January 2007 January 2007 K+S Group 30
Slide 32: Experience growth.
www.k-plus-s.com Experience growth. K+S Aktiengesellschaft Investor Relations Bertha-von-Suttner-Straße 7 phone: +49 (0)561 / 9301-1460 34131 Kassel (Germany) fax: +49 (0)561 / 9301-2425 phone: +49 (0)561 / 9301-0 email: investor-relations@k-plus-s.com fax: +49 (0)561 / 9301-1753 January 2007 K+S Gr
Slide 33: Content
K+S Group Content A. Corporate Structure B. Core Business Segments: - Fertilizers and Plant Care - Salt C. Strategy and Outlook D. Financial Data E. K+S Share Appendix January 2007 K+S Group 32
Slide 34: History
K+S Group History 1889 Formation of „Aktiengesellschaft für Bergbau und Tiefbohrung“, the oldest predecessing company of today`s K+S Aktiengesellschaft 1970 Merger of all three West-German potash producers to Kali und Salz AG; BASF is majority shareholder 1993 Merger of the potash and rock salt acti
Slide 35: Key Figures as of 30 September (9M)
K+S Group Key Figures as of 30 September (9M) € million 2006 2005 % Revenues 2,225.7 2,099.7 6.0 Operating earnings (EBIT I) 224.2 202.1 10.9 Earnings before taxes (EBT), adjusted* 212.9 194.9 9.2 Group earnings after taxes, adjusted* 141.7 125.6 12.8 Effective tax rate (%) 33.4 35.6 Capital expendi
Slide 36: Key Data of the K+S Share
K+S Group Key Data of the K+S Share 2006 2005 2004 2003 2002 2001 Earnings per share, adjusted (€)* tba 3.81 2.43 2.42 2.43 2.73 Dividend per share (€) tba 1.80 1.30 1.00 1.00 1.00 Book value per share, adjusted (€)*,** 24.16 22.58 20.76 13.76 12.42 11.48 Year-end closing price (XETRA, €) 82.20 51.0
Slide 37: Shareholder Structure
K+S Group Shareholder Structure Switzerland permanent BASF France 2.7% holdings employees* (permanent 4.0% Rest of 10.3% 2.2% holdings) USA & Canada Europe 1.5% 10.3% 12.6% German institutional freefloat UK & Ireland investors 22.8% 89.7% 13.4% Germany* private investors* foreign institutional 65.8%
Slide 38: USD Currency Management 2005 - 2009
Potash and Magnesium Products USD Currency Management 2005 - 2009 z Revenues less overseas freight costs and a safety margin are hedged three years in advance by means of double barrier options z Double barrier options: no classic hedging mechanism, only effective within certain barriers; restructur
Slide 39: USD Double Barrier Option System
Potash and Magnesium Products 1,65 USD Double Barrier Option System 1,60 1,55 USD/EUR 1,50 1.50 1,45 1.45 1,40 1.40 1,35 1.35 1,30 1.30 1,25 1.25 1,20 1.20 1,15 1.15 1,10 1.10 1,05 1.05 1,00 1.00 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 31 Dec. 2004 2005 20
Slide 40: USD Currency Management 2007 - 2009
Salt USD Currency Management 2007 - 2009 z Hedging of USD net position approx. three years in advance by means of double barrier options as for the Potash and Magnesium Products business segment z Double barrier options: no classic hedging mechanism, only effective within certain barriers; restructu
Slide 41: USD Double Barrier Option System
Salt 1,65 USD Double Barrier Option System 1,60 1,55 USD/EUR 1,50 1.50 1,45 1.45 1,40 1.40 1,35 1.35 1,30 1.30 1,25 1.25 1,20 1.20 1,15 1.15 1,10 1.10 1,05 1.05 1,00 1.00 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 1 Jan. 1 July 31 Dec. 2004 2005 2006 2007 2008 2009 USD/EUR
Slide 42: Financial Calendar
K+S Group Financial Calendar 15 March 2007 ¾ Report on business in 2006 ¾ Annual report and analyst conference, Frankfurt 09 May 2007 ¾ Annual General Meeting 2007, Kassel ¾ Interim report 31 March 2007 10 May 2007 ¾ Dividend payment for the year 2006 14 August 2007 ¾ Interim report 30 June 2007 13
Slide 43: Forward-Looking Statements
K+S Group Forward-Looking Statements This presentation contains facts and forecasts that relate to the future development of the K+S Group and its companies. The forecasts are estimates that we have made on the basis of all information available to us at this moment in time. Should the assumptions u
Slide 44: Experience growth.
www.k-plus-s.com Experience growth. K+S Aktiengesellschaft Investor Relations Bertha-von-Suttner-Straße 7 phone: +49 (0)561 / 9301-1460 34131 Kassel (Germany) fax: +49 (0)561 / 9301-2425 phone: +49 (0)561 / 9301-0 email: investor-relations@k-plus-s.com fax: +49 (0)561 / 9301-1753 January 2007 K+S Gr
K+S Aktiengesellschaft — 6th German Corporate Conference (Cheuvreux) 2007 on 6ix