Icl Group Ltd. · TASE:ICL
Icl — Q3 2020 Earnings Presentation
33 slides from Icl's earnings presentation, Nov 12, 2020
Slide 1: Q3 2020 Results
Q3 2020 Re Raviv Zoller — l 4 President & CEO f ~ __ November 12, 2020 ‘ Hol > Ves
Slide 2: Important Legal Notes
Important Legal Notes Disclaimer and Safe Harbor for Forward-Looking Statements The information contained herein in this presentation or delivered or to be delivered to you during our presentation does not constitute an offer, expressed or implied, or a recommendation to do any transaction in ICL Gr
Slide 3: Q3 2020: Resilient Performance Amid COVID-19 and Low Commodity Prices
Q3 2020: Resilient Performance Amid COVID-19 and Low Commodity Prices Continuous strong cash generation despite COVID-19 and commodity challenges: operating cash flow and free cash flow of $203 million and $60 million, respectively All operating divisions delivered positive profitability Recordpotas
Slide 4: Key Financial Parameters
Key FinancialParameters Sales Adjusted EBITDA(1) Adjusted Net Income(1) Operating Cash Flow 23% 28% 20% 10% 18% 19% 19% 19% 17% 6% 15% 13% 4% 4% 5% 5% 1,325 1,106 1,319 1,203 1,204 307 201 250 246 226 130 48 60 72 58 368 212 166 177 203 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q3 2019 Q4 2019 Q1 2020
Slide 5: Industrial Products Segment
IndustrialProducts Segment Global economic slowdown related to SEGMENT EBITDA (1) COVID-19 impacted demand for clear brine fluids and bromine-based flame retardants $ millions Bromine prices in China increased towards end of quarter Demand for flame retardants recovering, mainly in construction and
Slide 6: Potash Segment
Potash Segment SEGMENT EBITDA(1) Average realized price dropped by $64 per tonne, 23% lower than Q3 2019 $ millions On track to achieve record annual potash production at the Dead Sea Vilafruns site closure on track 120 66 2 1 2 17 70 Sales mix expected to improve in Q4 2020, leading to higher avera
Slide 7: Phosphate Solutions Segment
PhosphateSolutions Segment SEGMENT EBITDA(1) Record operating income from phosphate specialties $ millions Record operating income for YPH JV in China Improved performance of commodity phosphates due to better sales mix and cost reduction initiatives 76 16 16 3 2 30 83 Seasonality expected to negati
Slide 8: IAS Segment
IAS Segment Sales increased by 8%, due to higher sales volumes in most product lines, despite seasonal weakness SEGMENT EBITDA (1) Cost reductions, including lower cost of raw materials, led to significant increase $ millions in EBITDA Generated operating cash flow of $38mn, a 60% improvement over Q
Slide 9: Acquisition of Fertilaqua: Executing on our Growth Strategy
Acquisition of Executing on our GrowthStrategy Executing Growth Strategy in CropNutrition Company info Significant foothold for ICL’s Crop Nutrition business in Biostimulants company providing plantnutrition, the high growth, high margin Brazilian agriculturemarket stimulation and soil revitalizatio
Slide 10: Summary & Outlook
Summary & Outlook Notable achievements despite market challenges: Resilient results amid COVID-19 and commodity challenges Continued solid cash generation fueled by cross-company cost saving initiatives Record nine months potash production at the Dead Sea Record operating income for phosphate specia
Slide 11: Kobi Altman, CFO
Kobi Altman CFO ANICL
Slide 12: Key Financial Metrics
Key FinancialMetrics Q3 2020 Q3 2019 % change Q2 2020 % change Sales 1,204 1,325 (9%) 1,203 ~ Operating income 100 201 (50%) (169) NA Adjusted operating income(1) 106 201 (47%) 128 (17%) Adjusted EBITDA(1) 226 307 (26%) 246 (8%) Net income 54 130 (58%) (168) NA Adjusted net income(1) 58 130 (55%) 72
Slide 13: Positive Pricing Momentum Across Mineral Value Chains
Positive Pricing Momentum Across Mineral ValueChains GMOP, CFR Brazil($/tonne) Phosphoric acid contract, CFR India($/tonne) 340 700 320 680 300 660 280 640 260 620 240 600 220 580 200 560 Elementalbromine, 5,000 4,800 China ($/tonne) 4,600 4,400 4,200 4,000 3,800 3,600 13 Sources: CRU, Bloomberg
Slide 14: Sales Impacted by COVID-19 and Cyclical Low Commodity Prices
Sales Impacted by COVID-19 and Cyclical Low Commodity Prices Sales Industrial Products: (76) Phosphate Solutions: 16 IAS: 13 1,325 92 50 21 1,204 Q3 2019 Commodity Quantities Exchange rates Q3 2020 prices Numbers may not add due to rounding and set offs All figures shown in US $ millions 14
Slide 15: Profitability Impacted by Commodity Prices
Profitability Impacted by CommodityPrices Adjusted EBITDA (1) 307 92 21 2 16 18 226 Q3 2019 Prices Quantities Energy Operating and Raw materials Q3 2020 other expenses 1. Adjusted EBITDA is a non-GAAP financial measure. See appendix to this presentation for reconciliation tables. Number may not add
Slide 16: Strong Cash Generation and Liquidity
Strong Cash Generation and Liquidity - Renewal of $300Mn Securitization - $900Mn credit facility extended to Operating cash flow Free cash flow(2) 2025 - No major maturities in the near-term - Q3 2020 dividend yield(1) 3.2% $203Mn $60Mn Net Debt to adjusted EBITDA(2) Immediately available liquidity
Slide 17: Key Takeaways
Key Takeaways Notable achievements despite market challenges: Resilient results amid COVID-19 and commodity challenges Continued solid cash generation fueled by cross-company cost saving initiatives Record nine months potash production at the Dead Sea Record operating income for phosphate specialtie
Slide 18: Thank You
Thank You Visit our new Interactive Data Tool at WWW.ICL-GROUP.COM
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Slide 20: Appendix
APPENDIX
Slide 21: Q3 2020 Sales
Q3 2020sales 1,325 92 50 21 1,204 Q3 2019 Prices Quantities Exchange rates Q3 2020 1,325 69 63 2 13 1,204 Q3 2019 Industrial Potash Phosphate IAS Q3 2020 Products Solutions Numbers may not add due to rounding and set offs. All figures shown in US $ millions 21
Slide 22: Q3 2020 Operating Income
Q32020 OperatingIncome 201 0 201 92 21 3 3 18 106 6 100 Q3 2019 Adjustments Q3 2019 Prices Quantities Operating and Energy & Raw Q3 2020 Adjustments Q3 2020 to operating adjusted other expenses transportation materials adjusted to operating income (Q3 '19) income (Q3 ‘20) 201 0 201 55 38 6 4 8 106 6
Slide 23: Q3 2020 Industrial Products Sales and Segment Profit Analysis
Q32020 Industrial Products Sales and Segment ProfitAnalysis SEGMENT SALES SEGMENT PROFIT 339 76 3 4 270 88 45 2 3 6 50 Q3 2019 Quantities Prices Exchange Q3 2020 Q3 2019 Quantities Exchange rates Prices Raw materials, Q3 2020 rates energy & operating and other Numbers may not add due to rounding and
Slide 24: Q3 2020 Potash Sales and Segment Profit Analysis
Q32020Potash Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT 376 66 1 4 313 83 66 5 1 17 28 Q3 2019 Prices Quantities Exchange Q3 2020 Q3 2019 Prices Energy, Exchange Quantities Q3 2020 rates transportation rates & other expenses Numbers may not add due to rounding and set offs. All f
Slide 25: Q3 2020 Phosphate Solutions Sales and Segment Profit Analysis
Q32020 Phosphate Solutions Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT Phosphate specialty : 290 Phosphate specialty : 295 Phosphate commodity: 218 Phosphate commodity: 211 Phosphate specialty : 30 Phosphate specialty : 34 Phosphate commodity: 2 Phosphate commodity: (6) 508 30 12
Slide 26: Q3 2020 Innovative Ag Solutions Sales and Segment Profit Analysis
Q32020 Innovative Ag Solutions Sales and Segment Profit Analysis SEGMENT SALES SEGMENT PROFIT 160 13 4 4 173 6 4 2 4 6 Q3 2019 Quantities Exchange Prices Q3 2020 Q3 2019 Raw Quantities Operating Prices Q3 2020 rates materials and other (2) expenses Numbers may not add due to rounding and set offs. A
Slide 27: Finance Expenses
Finance Expenses $ millions Q3 2020 Q3 2019 Liabilities(1) 2,825 2,650 Interest rate 3.7% 4.2% Interest expenses 26 28 Interest capitalization (6) (4) Interest expenses, net 20 24 Total hedging transactions, balance sheet revaluation & other 3 (6) Interest & exchange rate impact on long term liabili
Slide 28: Effective Tax Rate
Effective TaxRate $ millions Q3 2020 Q3 2019 Adjusted income before tax(1) 79 169 Normalized tax rate 20% 21% Normalized tax expenses 16 36 Carryforward losses not recorded for tax purposes (1) (6) Exchange rate impact and other items 1 5 Adjusted tax expenses 16 35 Adjusted effective tax rate 20% 2
Slide 29: Reconciliation Tables (1/3)
Reconciliation Tables (1/3) Calculation of adjusted income before tax Q3 2020 Q3 2019 Adjusted operating income(1) 106 201 Finance expenses (29) (32) Share in earnings (losses) of equity-accounted investees and adjustments to financial expenses 1 - Adjusted income before tax 79 169 Calculation of se
Slide 30: Reconciliation Tables (2/3)
Reconciliation Tables(2/3) Calculation of adjusted EBITDA Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Net income attributable to the shareholders of the Company 54 (168) 60 48 130 Depreciation and Amortization 123 119 118 113 110 Financing expenses, net 29 31 52 25 32 Taxes on income 14 (33) 20 15 35 Ad
Slide 31: Reconciliation Tables (3/3)
Reconciliation Tables (3/3) Calculation free cash flow Q3 2020 Q3 2019 Q2 2020 Cash flow from operations 59 134 177 Additions to property plant and equipment and dividends from equity-accounted investees(2) 1 87 (157) Free cash flow 60 221 20 Calculation of adjusted net income to net income Q3 2020
Slide 32: Non-GAAP Financial Measures
Non-GAAP Financial Measures We disclose in this Quarterly Report non-IFRS financial measures titled, adjusted operating income, adjusted net income attributable to the Company’s shareholders, adjusted EBITDA, adjusted EPS, segment EBITDA, segment EBITDA margin and free cash flow. Our management uses
Slide 33: www.icl-group.com
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