Yara International Asa · OSL:YAR
Yara International Asa — Investor Day (November 2005)
10 slides from Yara International Asa's investor day presentation, Nov 30, 2005
Slide 1: Agenda
Agenda z Introduction z Fertilizer market z Yara business model and strategy z Financial performance and scenarios z Business segments z Outlook and interactive feedback Date: 2005-11-30 Page: 24 24
Slide 2: Yara creates value in three different ways
Yara creates value in three different ways EBITDA, pro forma until L12M . z The Knowledge Margin USD millions Local market knowledge Deep customer relations 1,200 Agronomic and application competence 1,000 117 Differentiation and branding 104 . z The Logistics Leverage 800 339 319 Scale in
Slide 3: The Knowledge Margin: including farmers' value creation in the optimization
The Knowledge Margin Including farmers’ value creation in the optimization for win-win relationships Optimization basis: Past Yara Distributor • Meet basic plant nutrient needs • Yara and Distributor Optimization basis: Key Future Yara Account • Agronomic optimum • Yara, Key Account and Farmer Farme
Slide 4: Shifting volumes into more advanced segments
The Knowledge Margin Shifting volumes into more advanced segments … Price multiple per tonne nitrogen CN vs Urea (2004) High 5 4.2 4 Crop segment value 3 2.4 2 1 Low 0 Low High Crop specific marketing Specialty CN Maincrop CN Date: 2005-11-30 Page: 27 The overall goal for the specialty business is t
Slide 5: … improves margins
The Knowledge Margin … improves margins Main crop CN Specialties CN Volume and price Volume and price 250 300 800 230 Volume Volume Price 780 Price 220 250 200 760 740 210 200 Price index* Volume - kt Price index* 720 Volume - kt 150 200 150 700 190 100 680 100 660 180 50 640 50 170 620 0 0 600 160
Slide 6: Global optimization creates value
The Logistics Leverage Global optimization creates value 2004 fertilizer and nitrogen chemicals volumes in million tonnes Global Marketing and Sales Product source* optimization Fertilizer Europe Yara production 13.1 9.7 Europe Latin America 3.2 Yara production 2.4 outside Europe Sourcing Business A
Slide 7: Our ammonia sources and shipping fleet cover all key markets
The Logistics Leverage Our ammonia sources and shipping fleet cover all key markets • Global multi-functional: producer, trader and shipping manager • Balanced regional presence • Committed sourcing and customers in all regions • Storage capacity in every region • Inter-regional trade arbitrage and
Slide 8: Our production system creates economies of scale
The Global Commodity Game Our production system creates economies of scale Global no 1 in NPK Global no 1 in ammonia Global no 1 in nitrates complex fertilizer Production capacity* (mill t) Production capacity (mill t) Production capacity* (mill t) 6 6 5.1 6 4.6 4.2 4 4.0 3.3 4 4 3.0 3.0 2.1 2.1 2 2
Slide 9: Increasing proportion of gas purchases in low-cost regions
The Global Commodity Game Increasing proportion of gas purchases* in low-cost regions 100% 90% 80% 70% Europe 60% Australia 50% Future capacity Russia growth in low- 40% cost regions Middle East 30% Caribbean 20% 10% 0% 2003 2004 2005 2006 * Equity share of joint ventures included Date: 2005-11-30 P
Slide 10: Example: Rossosh combines Yara's Knowledge and Logistical expertise
Example: Rossosh combines Yara’s Knowledge and Logistical expertise Yara's Nitrophosphate NPK z Yara captures synergies with Rossosh in different areas : position significantly strengthened 2005: Thousand tonnes – NPK sales to China 4,000 – Large scale distribution (only marginal cost increases) 3