Icl Group Ltd. · TASE:ICL
Icl — Israel Chemicals — Q4 2015 Earnings Presentation
21 slides from Icl's earnings presentation, Feb 9, 2016
Slide 1: Q4 2015 Results
Mr. Stefan Borgas | President & CEO February 09 , 2016 Q 4 2015 Results
Slide 2: Important Legal Notes
Important Legal Notes The information delivered or to be delivered to you does not constitute an offer or a recommendation to do any transaction in Israel Chemicals Ltd . (ICL) securities . Certain statements in this presentation and other oral and written statements made by ICL from time to time,
Slide 3: Good Quarterly Performance in a Very Challenging Environment
Good Quarterly Performance in a Very Challenging Environment $ millions Q 4 15 Q 4 14 % change 2015 2014 % change Sales 1 , 427 1 , 403 1.7 % 5 , 405 6 , 111 ( 11.6 )% Adjusted operating income 233 201 15.9 % 994 960 3.5 % Net income 96 86 11.6 % 509 464 9.7 % Adjusted net income 180 108 66.7 % 69
Slide 4: Business Environment & Major Developments
Business Environment & Major Developments 4 ICL Fertilizers ▪ Lower costs per tonne due to operational excellence contribution and record production ▪ Potash supply framework agreement in China ensures market position ▪ Declining potash & phosphates prices ▪ Absence of potash shipments to China and
Slide 5: ▪ New culture of efficiency after strike in the Israeli sites ▪ $ 275
▪ New culture of efficiency after strike in the Israeli sites ▪ $ 275 million run - rate savings (vs. 2013 ) ▪ Potash cost per tonne reduction ▪ Continued profitability improvements in phosphates ▪ YPH JV ▪ Record production at ICL Dead Sea in Q 4 ▪ Whey protein business integration ▪ Divestitures ▪
Slide 6: Efficiency Initiatives Contribution – Segment Breakdown
Efficiency Initiatives Contribution – Segment Breakdown 6 USD millions/year 2015 actual efficiency gains of $ 175 M vs. 2014 Segment actual contribution 2016E 2015E 2014A Potash Phosphates and fertilizers ICL IP ICL PP $ 275 million $ 100 million $ 350 - 370 million Labor costs savings in 2015 ~$ 25
Slide 7: Transforming Into The World's Leading Specialty Phosphate Player
+ 15 %* + 58 %* + 117 %* + 45 %* + 63 * 780 256 600 1 , 900 4 , 000 115 60 700 850 2 , 500 120 Transforming Into The World’s Leading Specialty Phosphate Player 7 ICL** YPH JV Thousand tonnes 899 436 1 , 300 2 , 750 6 , 500 Expansions Phosphate Fertilizers Food Specialties Advanced Additives Specialt
Slide 8: Delivering on the Bromine Value Chain Strategy
8 Delivering on the Bromine Value Chain Strategy Bromine price in China (RMB/MT) Nov 2014 ICL announces a 20 % price increase Dec 2015 Price is up by 54 % vs. Nov 2014 x About 50 % y/y increase in Bromine prices in China x 10 % - 20 % increase in Bromine compound prices x Focused on margin expansion
Slide 9: Implementing Food Specialty strategy
9 Implementing Food Specialty strategy Protein Fortification Innovation x Acquired dairy technology in Austria & Germany x Expanded Technical Application Centers in Germany, USA, Brazil and Australia with China to follow x Strengthened portfolio for beverage and meatless/vegetarian industry Implemen
Slide 10: Commodity Business Units' Targeted Top and Bottom Line Growth
Potash Phosphates Commodity Business Units’ Targeted Top and Bottom Line Growth Potash operating income ($M) Sales ($M ) Adjusted Operating Income ($M) Potash ~ 0 % 1 - 3 % Phosphates 5 - 7 % 8 - 10 % CAGR 2014 - 2020 Sales Adj. O/I Potash Bulk phosphates
Slide 11: Specialty Business Units' Targeted Top and Bottom Line Growth
56 36 229 281 49 44 Specialty Business Units’ Targeted Top and Bottom Line Growth 11 Sales ($M) Food specialties 8 - 10% 9 - 11% Advanced additives 3 - 5 % 8 - 10% Industrial solutions ~0% 1 - 3 % Flame retardants 5% 30 - 40% Polysulphate TM 30 - 50% 60 - 80% Specialty Fertilizers (Incl. SOP, NOP) 8
Slide 12: Improving Our Commodity - Specialty Balance
Improving Our Commodity - Specialty Balance Sales Adjusted Operating Income Specialty 56 % Specialty 35 % Commodity 44 % Specialty 48 % Specialty 62 % Commodity 38 % Commodity 65 % Commodity 52 % 2014 2014 2020 Targeted 2020 Targeted
Slide 13: Financial Results
Financial Results Mr. Kobi Altman Executive VP & CFO
Slide 14: Good Quarterly Performance Despite a Very Challenging Environment
Good Quarterly Performance Despite a Very Challenging Environment Q 4 2015 Sales Q 4 2015 Adjusted o perating income Numbers may not add up due to rounding $ millions Q 4 15 Q 4 14 % change 2015 2014 % change Sales 1 , 427 1 , 403 1.7 % 5 , 405 6 , 111 ( 11.6 )% Adjusted operating income 233 201
Slide 15: Potash Bridge Analysis
Potash Bridge Analysis Sales ($M) Adjusted Operating income* ($M) Numbers may not add up due to rounding * Excluding the following one - time items : strike compensation in the amount of about $ 8 million, ICL UK early retirement provision in the amount of about $ 6 million and an update of the p
Slide 16: Reduced Average Cost Per Tonne - Potash
60 % 40 % Reduced Average Cost Per Tonne - Potash 16 * Calculation based on adjusted full costs, including COGS, royalties, depreciation, freight and transportation, G&A, S&M. ▪ Increased production (Q/Q) at all our facilities ▪ Labor cost reduction and increased operating efficiency ▪ Depreciation
Slide 17: Phosphate and Specialty Fertilizers
Phosphate and Specialty Fertilizers Sales ($M) Adjusted Operating income* ($M) Numbers may not add up due to rounding * Excluding the following one - time items : electricity system management provision for prior periods of $ 2 million, costs related to the closing of the YPH JV transaction in th
Slide 18: Reduced Average Cost Per Tonne - Phosphates
Reduced Average Cost Per Tonne - Phosphates 18 Cost per tonne decrease - m ainly a result of company e fforts Green phosphoric Acid Cost $/ tonne FOB 57 % 43 % ICL Initiatives External factors GTSP Cost $/ tonne FOB White phosphoric Acid Cost $/ tonne FOB Phosphate Rock Cost $/ tonne FOB 78.4 % 90
Slide 19: Industrial Products
Industrial Products Sales ($M) Adjusted Operating income* ($M) Numbers may not add due to rounding * Excluding the following one - time items : Israel and the US asset impairments in the amount of approximately $ 56 million and $ 49 million in Q 4 2014 , a provision for historical waste treatment
Slide 20: Performance Products
Performance Products Sales ($M) Adjusted Operating income* ($M) Numbers may not add due to rounding 363 325 1 77 104 12 26 10 1 4 7 27 1 * Excluding the following one - time items : Q 4 2015 : costs related to the sale of non - core business of about $ 7 million. Q 4 2014 : asset impairments of a
Slide 21: Thank You
Thank You SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Israel Chemicals Ltd. By: /s/ Kobi Altman Name: Kobi Altman Title: Executive Vice President an