OCI N.V. Investor Presentation - January 2020
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OCI N.V. Investor Presentation January 2020
Disclaimer
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2
Agenda
1 Key Highlights
2 Company Overview
3 Summary of Key Financials
4 Appendix
3
Safety First: Commitment to Zero Injuries
▪ We are committed to providing a safe and healthy workplace for all employees and stakeholders by
implementing the highest international safety standards to avoid any potential risks to people,
2018 Safety Scorecard
communities, assets or the environment
▪ Our goal is to achieve leadership in safety and occupational health standards across our operations 9.6M
by fostering a culture of zero injuries at all our production facilities, and continuously improving Man hours worked without a lost-time
health and safety monitoring, prevention and reporting across our plants injury
Total TRIR (Total Reportable Incident Rate)1,2 OCI’s track record is better than industry average 50%
Reduction in zero lost-time injuries in 5
(53%) Industry OCI years
avg.3
0.83
1.78
0.55 84%
0.36 0.39 Reduction in employee lost-time injuries
0.30
in 5 years
2014 2015 2016 2017 2018
0.99 5
Total LTIR (Lost Time Injury Rate LTIR)1,2
Plants achieved zero lost-time injuries
(50%)
0.16
0.13 0.12
0.39 53%
0.09 0.08 Reduction in total recordable injuries in 5
0.08 years
2014 2015 2016 2017 2018 LTIR Employee TRIR
72%
Reduction in employee total recordable
injuries in 5 years
Source: Company information 4
1 Includes both employees and contractors; 2 Per 200,000 hours worked; 3 Industry averages for 2017 as compiled by International Fertilizer Association (IFA)
Leading Global Producer and Distributor of Nitrogen Products and Methanol
Nitrogen Products Methanol
% of Sep-19
76% 24%
LTM Revenue1
Products Ammonia, urea, CAN, UAN, DEF and melamine Methanol
# of Plants 6 3
▪ 3rd largest global producer of nitrogen fertilizers
▪ 5th largest global methanol producer
▪ 2nd largest CAN producer in Europe
▪ Largest global bio-methanol producer
Market position ▪ Largest global melamine producer
▪ Largest producer in Europe
▪ Largest seaborne nitrogen export platform globally
▪ 2nd largest US producer
▪ Fast-growing presence in DEF
▪ Methanol prices improved recently, as spot prices
have fallen below the global cost curve and MTO
▪ Tightening supply for all products
utilization stabilized with positive production
Key trends ▪ Natural gas costs expected to remain competitive in Europe and US
margins
▪ Premium products growing fast
▪ Underlying long-term fundamentals of market
remain strong
Raw materials Natural gas Natural gas
MTO, MTBE, fuel producers, industrial chemicals
Customers Farmers, diesel vehicle owners, industrial chemicals producers
producers
Monetizing natural gas through a broad range of essential products
Source: Company information 5
1 As of September 30th, 2019.
Our Commitment to a More Sustainable World
▪ We seek to provide sustainable solutions to our agricultural and industrial customers. We are committed to investing in a greener future to
create value for our communities, our customers, our employees and our shareholders
6
Investing in Sustainable Fuel Solutions
Investing in developing products and initiatives to provide cleaner and more sustainable solutions to our customers
Diesel Exhaust Fluid (AdBlue) Bio-Methanol / Methanol as an Alternative Fuel
▪ DEF is one of OCI’s fastest-growing products, becoming a major ▪ Leading bio-methanol producer: OCI produces bio-methanol by
product for our US operations: using biogas rather than natural gas at BioMCN in the Netherlands
‒ Following an expected doubling of volumes in 2019 compared and at OCI Beaumont in the United States
to 2018, further strong growth in 2020 expected How this helps reduce our carbon footprint
‒ IFCo can produce 1 million metric tons of DEF a year ▪ Biogas, as known as biomethane, is sourced from a range of waste
▪ DEF, also known as AdBlue, is a urea solution that can be injected digestion plants and other renewable sources
into Selective Catalytic Reduction (SCR) systems to lower harmful ▪ Using biomethane as a feedstock means we consume less natural
vehicle exhaust emissions from diesel engines gas and helps reduce harmful methane emissions from waste
▪ DEF demand growth in US and Europe over next decade is mainly sources that would otherwise be released into the air.
supported by replacement of older non SCR-equipped vehicles as What bio-methanol can be used for
well as increased dosing rates in newer generation diesel engines: ▪ When used as a biofuel, bio-methanol has a 60% GHG savings
‒ 15% growth expected over the next few years versus gasoline, helping to decarbonize the transportation sector
▪ DEF priced at a premium to urea ‒ Methane emissions account for 16% of global GHG emissions
and trap up to 36 times more heat in the atmosphere than CO2
over 100 years
▪ Bio-methanol can also be used as a green building block for a range
of products, including bio-MTBE, bio-DME, bio-hydrogen, synthetic
biofuels, silicones, plastics, and paints
▪ Bio-methanol is priced at a premium to conventional methanol
7
Source: Integer, PADD
OCI Build and Transition Phases Complete
Debut ratings Current ratings
Issuer rating Ba2 / BB- / BB Ba2 / BB / BB
Transition to run-
Platform build-up Run-rate
rate
Bond rating B1 / BB- / BB- Ba3 / BB / BB
2008 – 2017 2018 - 2019 2020
+$5bn Capex Program Deleveraging
▪ Completed 3 greenfield expansion projects, including the
construction of IFCo, Sorfert, and Natgasoline ▪ Build and transition phases complete
▪ Upgrade and debottlenecking at OCI Nitrogen ▪ Volume ramp up underway post end of capex program
▪ Refurbishment of BioMCN ▪ Deleveraging expected despite market volatility
▪ Acquisition, refurbishment and debottlenecking of OCI ─ Target 2.0x net leverage through the cycle
Beaumont
8
Key Highlights | OCI at a Glance
What Differentiates OCI Performance Drivers 2019 - 2020
Global leader in nitrogen and methanol with excellent ▪ Substantial reduction in execution risk, expect strong volume
ramp-up for nitrogen and methanol
diversification – product & geographical
✓ Growth capex program completed
✓ IFCo ramped up and continues to push production levels up
to record levels post debottlenecking
Volume ramp up underway post end of capex program ✓ Sorfert reaching utilization rates in excess of 90% following 2
major turnarounds during Q1 and Q3 2019. Achieved record
ammonia production in December 2019
✓ JV with ADNOC (Fertiglobe) adds to consolidated platform
✓ BioMCN M2 ramped up August 2019
Robust free cash flow conversion and deleveraging focus
✓ Natgasoline ramping up to full production
✓ Egyptian assets provide steady cash generation
Favourable position on the cost curve with state of the art
▪ Benign gas pricing environment in both US and Europe
asset base
▪ Upside from pricing with all prices below mid-cycle averages
Highly strategic locations allow for enhanced netback
pricing globally ▪ Demonstrated commitment to financial discipline and
deleveraging
✓ Significant capital structure simplification achieved
✓ Will continue to prioritize FCF towards deleveraging
Supported by strong industry trends and market dynamics
✓ Commitment to 2x net leverage target through the cycle
9
Capacity Ramp-up Driving Volume Growth
2008 2017 Q4 2019
End-2019
Site
Site locations
locations 1 5 Key Drivers of OCI Growth 9
Capacity: 1.3mtpa Capacity: 11.6 mtpa ▪ 2018: Natgasoline starts Capacity: 16.1 mtpa
production, ramping up in
2019, and run-rate expected
UAE
in 2020 Europe 13%
▪ 2019: 24%
North
Europe
Africa ❑ OCI Beaumont
Capacity split 29%
38% debottlenecking (>10%
by geography North
North increase in capacity); Africa
Africa ❑ Start-up BioMCN M2 (0.5 28%
100% mt) in Q3; US
US 35%
33% ❑ Start consolidation
ADNOC JV in Q4 2019;
❑ IFCo reaching higher
Maximum Proven
Capacity (MPC) in Q3
Methanol 2019 and significant
Melamine 11% growth in DEF; Methanol
2% Urea ❑ Turnaround of both of 18%
27% Melamine
DEF Sorfert’s ammonia lines in UREA
1%
Capacity split 8% Q1 and Q3 ‘19 which will 34%
well-position for higher DEF
UREA CAN utilization rates in 2020
by product 6%
100% 12% UAN ▪ 2020: expected to be first full CAN UAN
Net 20% year post growth capex and 16%
10%
Ammonia Net
inclusion of Fertil
20% Ammonia
15%
Volume growth in 2020 reflecting new capacities, addition of Fertil and a maturing & stable platform
Source: Company information. 10
Note: Natgasoline proportionate capacity, all other capacities at 100%OCI N.V. – ADNOC Partnership (Fertiglobe) | Strengthening Competitive Position
First-of-its Kind Export Platform Urea and Ammonia Global Seaborne Export League Table1
Sellable Ammonia and Urea Export League Table (mtpa)
▪ OCI N.V. and ADNOC have created Fertiglobe:
6.5
o Combining ADNOC’s fertilizer business into OCI’s Middle
East and North Africa (MENA) nitrogen fertilizer platform Player #2 6.3
o OCI and ADNOC own a 58% and 42% stake, respectively Player #3 6.0
o Fertiglobe has >$1.7 billion of annual revenues based on Player #4 5.4
2018 pro forma figures2
o OCI will fully consolidate the combined business Player #5 4.9
o Innovative approach to growth by asset contribution 4.4
achieves overnight scale, without any capital outlay MENA
Player #7 3.6
o Transaction closed Sep 30th 2019
Player #8 3.5
▪ A new global Nitrogen Fertilizer leader:
Player #9 3.2
o World’s largest nitrogen fertilizer seaborne export-
focused platform 2.5
Player #10
o Leading MENA producer with 1.53 mtpa of sellable 2.5
ammonia and 5.03 mtpa of urea Player #11
Player #12 2.3
o Combined platform benefits from greater geographic
diversity and market access
2.1
o Sellable capacity represents approximately 10% of 2018
Player #14 1.9
combined ammonia and urea global seaborne exports
▪ Expected to create significant value through the unlocking of Player #15 1.7
commercial and technical synergies ($60-75m)4
Source: Company estimates, public filings, CRU, Fertecon, Integer.
1 Estimates based on published capacity data and historical exports. 2 Pro forma for Fertil. 3 Annual production capacity 4 We expect that the synergies will be predominantly generated through commercial synergies, such as
high product and technology overlap, with the ability to leverage scale for cost synergies. The Group and its management believe that the synergies have been calculated on a reasonable basis, reflecting the best estimates and
judgments, and represent, to the best of management's knowledge and opinion, the expected synergies that may be capable of being realized in connection with the establishment and operation of FERTIL. However, because
11
this information is highly subjective, it should not be relied on as necessarily indicative of actual or future results.Favourable Positions on the Global Cost Curve for Fertilizers…
Urea global export cost curve (2019) IFCo well-positioned on the cost curve2
300
Total ocean/rail freight1 cfr urea costs, 2019 basis ($/t) Urea ($/short ton)
250 Cost to FOB/FOT
ExW cost 160
200 140
120
150
100
100 80
60
50 40
20
0
0
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 Donaldsonville,
Russia Trinidad IFCo
Million tons LA
Ex-works production cost Freight to Midwest
Competitive energy efficiency of European ammonia plants3 Key Cost Items
(GJ/mt NH3 LHV)
▪ Location is key as freight increases cost: OCI benefits from well-positioned
1st Quartile 2nd Quartile 3rd Quartile 4th Quartile locations across its platform with proximity to end users
▪ Fertiglobe has significant competitive advantage as result of long-term
39-49
fixed gas supply agreements
36-38
– Strategic locations with access to key ports on the Mediterranean, Red
32
33-35 Sea and Arabian Gulf
31
▪ As a new greenfield facility, IFCo has lower energy costs than average for
US plants and is positioned in the lowest quartile of global cost curves
– High netbacks supported by IFCo’s strategic location in the US MidWest
▪ OCI Nitrogen is in top quartile plant on a gas to ammonia conversion
Source: Integer, Company information, peer public filings, broker estimates, IFA, Argus efficiency perspective compared to European peers as a result of
1 Weighted average of top three global export destinations
significant investment by OCI
2 Charts reflect ex-works and do not include transport benefit to customer or benefit of Midwest premium
3 Based on IFA report published in March 2016 for operating years 2013-2014. OCI Nitrogen’s two ammonia lines are represented 12…and Also Strong Position on the Methanol Global Cost Curve
Methanol global cost curve – Sep-2019 MeOH delivered cash cost to coastal Low cost position attributable to advantageous
China main ports (net available capacity)1 access to feedstock and distribution infrastructure
$600 2019E China
✓ Access to low cost US shale economics
demand
✓ Multiple ammonia and methanol pipeline customers
leading to higher netbacks
$500
✓ Ability to transport using 3 modes: barges, trucks and
deep sea vessels
$400
US$ per metric ton
✓ Access to low cost US shale
economics
$300 China Adjusted Import Prices
(CFR plus duty, throughput) ✓ Easy access to the US Gulf export infrastructure
✓ Adjacent to OCI Beaumont allowing for technical synergies
China Adjusted Domestic Prices
$200
(Avg East / South China less VAT)
$100
✓ Access to bio-gas sourced from waste
digester plants connected to the Dutch
national natural gas grid
✓ Benefits from structural decline in gas prices due to LNG
$0 glut
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000
✓ Premium priced bio-methanol
Cumulative Available Capacity (‘000 metric tons)
Source: MMSA 13
Note: Assumes 100% capacity utilization
1 Cost curve assumes delivery costs to ChinaState-of-the-Art and Young Asset Base
OCI’s capacity breakdown by vintage (% of total capacity)
56%
Youngest asset base relative to global
peers with 34% of production capacity
under 5 years old
17%
11%
8% 7%
>40 years 30-40 years 20-30 years 10-20 years 0-10 years
▪ Invested over $5 billion since 2010 in growth and improvement capital expenditures (of which, approximately 80% on expansion
projects and 20% of improvements)
▪ Age profile of our assets allows us to maintain high utilization rates with low maintenance capex requirements
14Structurally Low Gas Prices Enhance our Competitive Cost Position
TTF Gas Prices | Historical and Forward Curve ($/mmBtu) Henry Hub Forward Curve (NYMEX) Progression ($/MMBtu)
12.0 $6.00
$5.00
Gas Price ($/MMBtu)
10.0
$4.00
8.0 $3.00
$/mmBtu
$2.00
6.0
$1.00
4.0 $0.00
($1.00)
2.0
04/2027
10/2019
04/2020
10/2020
04/2021
10/2021
04/2022
10/2022
04/2023
10/2023
04/2024
10/2024
04/2025
10/2025
04/2026
10/2026
10/2027
04/2028
10/2028
04/2029
10/2029
04/2030
10/2030
04/2031
10/2031
0.0
Q1 17
Q3 18
Q1 15
Q3 15
Q1 16
Q3 16
Q3 17
Q1 18
Q1 19
Q3 19
Q1 20
Q3 20
Q1 21
Q3 21
Q1 22
Today 3Y Ago 5Y Ago ANR SW Basis (Today)
▪ We expect to continue to benefit from materially lower gas prices in both Europe and the United States:
‒ A wave of investment in LNG is resulting in an increase in cheap energy (global LNG effective capacity is set to grow by over
20% from 2018 to 2021)
▪ In the US, Henry Hub decreased to very competitive prices that are significantly below the levels of last year:
‒ The forward curve suggests this will remain for the foreseeable future, which will continue to keep our US operations at the
very low end of the global cost curve
Source: Bloomberg, Argus 15Structural Supply-Demand Imbalance Expected to Support Fertilizer Prices
Global urea capacity additions (ex-China) below demand growth Ammonia Market Tightening Expected after Difficult 2019
million mtpa
Ammonia markets have been
10.0 50% of estimated additional 4 oversupplied since early 2019
capacity 2020-2022 to occur in Iran, but no further major new
8.0 3 merchant supply expected until
India and Nigeria 2023, and demand expected to
2 strengthen
6.0
Demand trend growth ~>3 mtpa 1
4.0 10 year historical CAGR
0
2.0
-1
0.0
-2
2016 2017 2018 2019 2020 2021 2022
2016 2017 2018 2019 2020 2021 2022
Capacity Additions Demand Growth
▪ New planned capacities prone to delays due to availability of
feedstock, construction delays and other factors Historical Fertilizer Price1)
▪ Chinese exports at low levels, but will be required in tightening market Ammonia NW Europe CFR ($/Mt)
Midcycle ammonia Urea and CAN prices on positive
Urea Granular Egypt FOB ($/Mt) trajectory, ammonia at
inflection trough, but nitrogen
China Urea Exports (mtpa) 700 prices are still 25-35% below 10-
year mid-cycle average
YTD 2019 avg monthly
13.6 13.7 exports annualized
500
8.9
8.3
7.0 6.9
5.3 4.7 300
4.4
3.4 3.6 4.7
2.5
1.6 1.4
100
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: Company information and estimates, CRU, Fertecon, Integer, CFMW, company reports 16New Merchant Global Methanol Supply Expected to be Below Demand Growth
Methanol demand growth expected to outstrip supply 2018 Global Methanol Demand by Derivative (100% = 91 mt)
million mtpa Blue = GDP Core – 43%
Green = Fuel/Energy – 33% Formaldehyde
35.0 Gray = MTO – 24% 26%
Methanol-to-
30.0 Olefins 23%
Demand Acetic Acid 8%
25.0 MTBE 12%
outstrips MMA 2%
supply DME 3%
Methylamines
20.0 Biodiesel 3% 2%
Fuel blending Methyl Chloride
13% Others 5% 3%
15.0
10.0
Incremental methanol demand in the medium term of ~3-4mn tons
5.0 from new MTO facilities
0.0 Historical Methanol Price1)
2019E 2020E 2021E 2022E 2023E 2024E
US Methanol Contract (US$ / t) Mid-Cycle Methanol (US$ / t)
Firm Incremental Capacity Theoretical Incremental Capacity 700
Incremental Demand Utilization Rate
600
500
▪ Good visibility into next 4-6 years of capacity additions given shortage of
400
start-up activity today
▪ Demand growth expected to be driven by core derivatives (GDP growth), 300
fuel applications, and MTO/MTP
200 Prices almost $90 below mid-cycle, but recent support from spot price
improvements.
100
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: Company information and estimates, MMSA, Argus, IMF, IHS, company reports
1 Midcycle average prices are defined as average prices for last ten years 17Agenda
1 Key Highlights
2 Company Overview
3 Summary of Key Financials
4 Appendix
18A Leading Global Provider and Distributor in Nitrogen Products and Methanol
Natgasoline is
not a reportable
segment of OCI’s
Nitrogen Nitrogen Nitrogen MENA Methanol as the entity is
Segment Methanol US
US Europe (Fertiglobe: 58% owned JV w/ ADNOC) Europe not consolidated
Brand FERTIL
Ammonia Ammonia
Ammonia
Urea UAN
Products UAN CAN
Urea Ammonia Urea Ammonia Methanol Methanol Methanol
Urea
DEF Melamine
Geography Iowa, US Netherlands Algeria Egypt Egypt UAE Texas, US Netherlands Texas, US Netherlands
OCI % Fertiglobe Ownership Public
100% 100% 100% 100% 50%
ownership company
51%2) 100% 60%3) 100%
Consolidation ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Production
3.4mt 2.8mt 2.1mt 1.6mt 0.7mt 2.1mt 0.4mt 1.0mt 1.0mt 1.8mt 16.1mt1
capacity (pa)
Geographically diverse production footprint in premium commanding locations
Fertilizers
Industrial Chemicals
1 Natgasoline production included on a proportionate basis
2 49% owned by Sonatrach 19
3 40% owned by various minorities, including Egyptian General Petroleum CorporationNitrogen Production Capacity and Commercial Footprint
Nitrogen Footprint
Iowa Fertilizer Company (IFCo) - Iowa, US Egyptian Fertilizer Co (EFC) – Egypt
▪ Production and sales started ▪ Acquired: 2008
April 2017
Product ktpa
Product2 ktpa Urea 1,648
Ammonia (net) 195
UAN 1,757
Urea 438
DEF 1,019
Egypt Basic Industries Corp (EBIC) – Egypt
▪ Acquired: 2009
N-7 JV
▪ Established: May 2018
▪ 50/50 JV between OCI and Dakota
Gasification Company
▪ Ability to distribute 4.5 million metric
tons of fertilizer products in N. America Product ktpa
▪ Ammonia, Urea, UAN, and DEF Ammonia 730
OCI Nitrogen – Netherlands Sorfert Algerie – Algeria Fertil (Abu Dhabi)
▪ Acquired: 2010 ▪ Commissioned: 2013 ▪ Commissioned: 1980
(Fertil 1) & 2009 (Fertil 2)
Product2 ktpa
Ammonia (net) 350 Product ktpa Product Ktpa
CAN 1,549 Urea 1,259 Urea 2,100
UAN 730 Ammonia (net) 803
Melamine 219
Perimeter of Fertiglobe JV (58% OCI / 42% ADNOC)
Production footprint facilitates a global approach to our commercial strategy
1 Capacities are maximum proven daily capacity (MPC) achievable x 365 days; 2 Maximum downstream capacities cannot be all achieved at the same time 20Methanol Production Capacity and Commercial Footprint
United States Global
OCI Beaumont (Texas, US) OCI Methanol Marketing
Product ktpa ✓ Wholly owned subsidiary marketing OCI’s 3.0Mt of
Methanol 1,0451 methanol portfolio globally
Ammonia 356 ✓ The distribution platform’s global footprint and
distribution allows it to optimize trade flows to enhance
netback pricing
✓ Strategically located on the Texas Gulf Coast
✓ Distribution offices in Houston, New York and
✓ Completion of CO2-related debottlenecking project in Amsterdam, with centralized commercial decision-
July 2019 which adds 125ktpa, i.e. c.13% of capacity making
(project cost: c.$10m)
Natgasoline LLC (Texas, US) OCI Fuels Europe
✓ Wholly owned trading entity supplying BioMCN (The Netherlands)
Product ktpa
biogas to OCI Beaumont to process into bio-
Methanol 1,825 Product ktpa
methanol
Methanol (I) 496
▪ Ownership: 50%2 ✓ Securing sizeable amounts of biogas from
✓ Commercial production started in June 2018 various landfills, anaerobic digesters and Methanol (II) 496
waste-water treatment plants
✓ One of the world’s largest methanol plants ▪ Acquired: 2015
✓ Connected to the national natural gas grid – itself
connected to the integrated NW Europe network
✓ Easy logistical access to major European end markets
via rail and sea freight from Delfzijl and road and barge
from terminal in Rotterdam
✓ Winner of Dutch National Enlightenmentz Awards for
an innovative green methanol production process
converting carbon dioxide and hydrogen into bio-
methanol
✓ BioMCN’s second line M2 started production in Q3
2019
1. Includes 125ktpa added in July 2019 as a result of debottlenecking project 21
2. JV with Consolidated Energy LtdAgenda
1 Key Highlights
2 Company Overview
3 Summary of Key Financials
4 Appendix
22Financial Highlights - Consolidated Statement of Income*)
$ million Q3 2019 Q3 2018 9M 2019 9M 2018
Net revenue 633.9 773.5 2,183.9 2,311.0
Cost of Sales (618.3) (636.9) (1,950.4) (1,844.4)
Gross profit 15.6 136.6 233.5 466.6
SG&A (45.4) (40.0) (143.9) (126.5)
Other Income 2.0 6.0 4.8 26.1
Other expense 0.7 (2.2) (2.5) (3.3)
Adjusted EBITDA 107.2 229.9 511.6 668.5
EBITDA 105.8 213.1 449.6 680.4
Depreciation & amortization (132.9) (112.7) (357.7) (317.5)
Operating profit (27.1) 100.4 91.9 362.9
Interest income 1.3 1.3 4.4 5.9
Interest expense (74.6) (78.4) (222.5) (260.6)
Other finance income / (cost) (26.9) (3.1) (39.9) (19.1)
Net finance costs (100.2) (80.2) (258.0) (273.8)
Income from equity-accounted investees (32.0) (3.0) (39.9) (15.3)
Net income before tax (159.3) 17.2 (206.0) 73.8
Income tax expense (10.8) (1.7) (6.7) 4.0
Net profit / (loss) (170.1) 15.5 (212.7) 77.8
Non-Controlling Interest (12.4) (30.5) (31.1) (107.8)
Net profit / (loss) attributable to shareholders (182.5) (15.0) (243.8) (30.0)
* Unaudited
1) Q3 and 9M 2018 have not been adjusted for IFRS 16
23Segment Information
Segment overview Q3 2019
$ million Nitrogen Nitrogen Europe Nitrogen MENA Methanol US Methanol Europe Eliminatio Other Total
US ns
Segment revenues 104.8 151.5 230.7 125.8 61.0 (5.0) - 668.8
Inter-segment revenues - (0.1) (19.9) (11.5) (3.4) - - (34.9)
Total revenues 104.8 151.4 210.8 114.3 57.6 (5.0) - 633.9
Gross profit (15.7) 19.3 37.2 (30.0) 5.6 22.1 (22.9) 15.6
Operating profit (20.4) 13.9 38.5 (34.8) 4.8 24.0 (53.1) (27.1)
Depreciation & amortization (51.9) (17.3) (44.7) (30.7) (4.5) 17.1 (0.9) (132.9)
EBITDA 31.5 31.2 83.2 (4.1) 9.3 6.9 (52.2) 105.8
Adjusted EBITDA 31.5 31.2 77.4 2.6 9.7 - (45.2) 107.2
Segment overview Q3 2018
$ million Nitrogen Nitrogen Europe Nitrogen MENA Methanol US Methanol Europe Eliminations Other Total
US
Segment revenues 111.6 215.0 301.1 144.8 53.7 - - 826.2
Inter-segment revenues - (0.1) (32.8) (18.7) (1.1) - - (52.7)
Total revenues 111.6 214.9 268.3 126.1 52.6 - - 773.5
Gross profit (0.9) 15.5 93.2 43.6 (7.3) (7.5) - 136.6
Operating profit (5.2) 7.7 88.8 32.7 (8.5) (0.8) (14.3) 100.4
Depreciation & amortization (34.8) (17.5) (43.1) (23.3) (1.3) 7.5 (0.2) (112.7)
EBITDA 29.6 25.2 131.9 56.0 (7.2) (8.3) (14.1) 213.1
Adjusted EBITDA 30.4 25.2 128.0 66.1 (6.7) - (13.1) 229.9
24Financial Highlights – Reconciliation of Adjusted EBITDA
Reconciliation of reported operating income to adjusted EBITDA
$ million Q3 2019 Q3 2018 9M 2019 9M 2018 Adjustment in P&L
Operating profit as reported (27.1) 100.4 91.9 362.9
Depreciation and amortization 132.9 112.7 357.7 317.5
EBITDA 105.8 213.1 449.6 680.4
APM adjustments for:
Natgasoline (1.4) 17.7 40.6 17.7 OCI’s share of Natgasoline EBITDA
Expenses related to expansion projects 0.4 0.5 1.4 1.5 SG&A / other expenses
Sorfert insurance income / release of provision - - - (30.8) Other income
Unrealized result natural gas hedging (3.2) - 5.5 - COGS
Transaction costs 11.5 - 18.5 -
Other including provisions (5.9) (1.4) (4.0) (0.3)
Total APM adjustments 1.4 16.8 62.0 (11.9)
Adjusted EBITDA 107.2 229.9 511.6 668.5
25Financial Highlights – Free Cash Flow
Reconciliation of EBITDA to Free Cash Flow and Change in Net Debt
$ million Q3 2019 Q3 2018 9M 2019 9M 2018
EBITDA 105.8 213.1 449.6 680.4
Working capital 0.2 (20.3) (17.1) (61.1)
Maintenance capital expenditure (78.0) (56.6) (123.3) (115.0)
Tax paid (16.4) (31.5) (56.4) (33.1)
Interest paid (38.8) (34.7) (188.7) (161.9)
Dividends from equity accounted investees / dividends paid to NCI (6.1) (8.0) (4.5) (21.1)
Insurance receivable / received Sorfert - - 31.8 -
Adjustment non-cash expenses 3.9 6.6 14.2 27.7
Free Cash Flow (29.4) 68.6 105.6 315.9
Reconciliation to change in net debt:
Growth capital expenditure (60.7) (38.8) (123.8) (112.4)
Acquisition non-controlling interest OCI Partners - (117.6) - (117.6)
Other non-operating items 39.0 1.8 24.6 (59.5)
Non-operating working capital 4.0 2.2 11.6 2.8
Net effect of movement in exchange rates on net debt 44.6 6.7 48.0 42.0
Other non-cash items (3.9) (1.8) (5.4) (39.2)
Net Cash Flow / Decrease (Increase) in Net Debt (6.4) (78.9) 60.6 32.0
26Prudent Financial Policy, with a Short-term Focus on Deleveraging
▪ Focus on deleveraging towards 2.0x net leverage
▪ Free cash flow will be prioritized to deleverage
Capital structure
▪ Continue to optimise and simplify capital structure
▪ Reduce weighted average cost of debt and extend debt maturity profile
▪ Opportunistically evaluate financing opportunities
▪ This may include refinancing of other subsidiary debt at the OCI NV level
▪ Over 50% of total run-rate natural gas volumes have fixed price long term contracts
Risk management
▪ MENA assets benefit from 20 – 25 year contracts
▪ Well-matched currency profiles of cash flows and debt provides a natural hedge
▪ The Group maintains comprehensive business and insurance coverage
▪ The Group continuously evaluates M&A opportunities to grow the business
M&A
▪ These are evaluated based on their contributions to the overall financial profile of the Group
Source: Company information 27Agenda
1 Key Highlights
2 Company Overview
3 Summary of Key Financials
4 Appendix
28Compelling Combination with Robust Financial Profile
Pro-forma FY 2018 consolidated financials based on 2019 ADNOC Fertilizers gas prices
$ million except otherwise stated
OCI - ADNOC Fertilizers JV Notes
Pro-forma Pro-forma 1
Ammonia: 2.422 ▪ Pro forma figures exclude
Sales Volume (millions of Ammonia: 1.434 Urea: 5.453 synergies
tons per annum)2 Urea: 5.085
Other products: 5.458
▪ 2018 CAPEX for both OCI MENA
Revenue 1,740 3,848 and ADNOC Fertilizers was low
compared to an expected run-
Adjusted EBITDA 740¹ 1,1773 rate capex for the JV of ~$70 -
$80m per annum
Maintenance CAPEX 23 1404
▪ Pro forma for the transaction,
Net Debt 657 4,079 OCI NV’s run rate maintenance
CAPEX is expected to be ~$180
Leverage5 0.9x 3.5x – $240m per annum
OCI N.V. pre-deal OCI N.V. post-deal ▪ Diversification of proportionate
Fertilizers Europe adjusted EBITDA before
Fertilizers Fertilizer Fertiglobe
15%
Europe MENA 37%6 synergies remains
14% 38%
Fertilizers US approximately the same before
Proportionate PF Adjusted 20% and after transaction
Fertilizers US
EBITDA split by segment7 19%
Chemicals US / Chemicals US /
Europe Europe
28% 29%
Note: Fertiglobe to be fully consolidated by OCI N.V. Based on new agreed ADNOC Fertilizers gas price for 2019 of $2.76 inflated at 3%, followed by 2022 base of $3.5 inflated at 3% 1 Pro forma for FERTIL to the Group results as of December
31st, 2018, these numbers were calculated by, and are the responsibility of, the Group's management. The Group and its management believe that these have been calculated on a reasonable basis, reflecting the best estimates and
judgments, and represents, to the best of management's knowledge and opinion, the true performance of FERTIL for the relevant period. However, because this information is highly subjective, it should not be relied on as necessarily 29
indicative of actual or future results 2 Own-produced and third-party traded; 3 Calculated by adding the adjusted EBITDA including lost profit from business interruption for the Company with the adjusted EBITDA presented for Fertil excluding
synergies 4 Excludes growth CAPEX of $157m for FY18 5 Net debt / adjusted EBITDA 6 Includes 58% of Fertiglobe pro-rata adjusted EBITDA 7 Excludes Other and Eliminations itemsRamp-Up of Methanol Capacity 2018 - 2019
BioMCN
Production Capacity million mtpa
Natgasoline
OCI Beaumont
0.5 3.0
0.1
0.9
1.4 Ramped-up August 2019
Started production July 2019
Started production June 2018
2018 (OCI Beaumont + Natgasoline OCIB expansion BioMCN M2 2020
Current
BioMCN M1)
June 2018 Q4 2019
30Debt Maturity Profile – Pre and Post Refinancing October 2019
Reduced short term refinancing risk and extended maturity profile
Weighted Average Group Debt Maturity Profile:
extended 6 months from 4.7 to 5.2 years
$ million ▪ In October 2019, OCI successfully completed a
2,000 c.$1.4 billion equivalent refinancing through a
dual-tranche bond offering in US$ and Euros :
1,800
o Consisting of $600m senior secured fixed rate
notes due 2024 and €700m senior secured
1,600 fixed rate notes due 2024. OCI and ADNOC own
a 58% and 42% stake, respectively
1,400
o The Dollar Notes bear interest at a rate of
1,200 5.250% per annum and the Euro Notes bear
interest at a rate of 3.125% per annum.
1,000
o The Notes were issued at par, are senior
800 secured obligations of the Company and are
guaranteed by certain of the Company's
600 subsidiaries.
o Interest will be payable semi-annually.
400
▪ Refinancing has resulted in a reduction in the
200 weighted average cost of debt of the refinanced
debt of about 90bps and has extended our
- maturity profile
2019 2020 2021 2022 2023 2024 2025 2026 -
2037
Status Quo Now
31
Note: Debt amount excludes deferred costs.Flexible Production Capabilities to Maximize Production of Most Profitable
Products
Max. Proven Capacities¹
('000 metric tons)
Total Total Total2)
Plant Country Ammonia Ammonia Urea UAN CAN Fertilizer Melamine4 DEF Nitrogen Methanol OCI NV
(Gross) (Net)3
Iowa Fertilizer Company5 USA 914 195 438 1,757 - 2,390 - 1,019 3,409 - 3,409
OCI Nitrogen5 Netherlands 1,184 350 - 730 1,549 2,629 219 - 2,849 - 2,849
Egyptian Fertilizers Company Egypt 876 - 1,648 - - 1,648 - - 1,648 - 1,648
Egypt Basic Industries Corp. Egypt 730 730 - - - 730 - - 730 - 730
Sorfert Algérie Algeria 1,606 803 1,259 - - 2,062 - - 2,062 - 2,062
Fertil UAE 1,205 - 2,100 - - 2,100 - - 2,100 - 2,100
OCI Beaumont USA 356 356 - - - 356 - - 356 1,045 1,401
BioMCN Netherlands - - - - - - - - - 991 991
Natgasoline LLC USA - - - - - - - - - 1,825 1,825
Total MPC 6,871 2,434 5,445 2,487 1,549 11,916 219 1,019 13,154 3,861 17,015
Excluding 50% of Natgasoline -913 -913
Total MPC with 50% of Natgasoline 6,871 2,434 5,445 2,487 1,549 11,916 219 1,019 13,154 2,949 16,102
Notes:
1 Capacities are maximum proven capacities (MPC) per line at 365 days. OCI Beaumont's capacity addition is an estimate of 2,853 tpd x 365 and BioMCN’s M2 capacity is an estimate based on 1,250 tpd x 365 days; 2 Total
capacity is not adjusted for OCI’s ownership stakes or downstream product mix limitations (see below), except OCI’s 50% stake in Natgasoline; 3 Net ammonia is estimated sellable capacity; 4 Melamine capacity split as 164
ktpa in Geleen and 55 ktpa in China. OCI Nitrogen owns 49% of a Chinese melamine producer, and exclusive right to off-take 90%; 5 OCI Nitrogen and IFCo each cannot achieve all downstream production simultaneously (i.e.:
OCI Nitrogen cannot maximize production of UAN, CAN and melamine simultaneously, and IFCo cannot maximize production of UAN, urea and DEF simultaneously) 32For OCI N.V. investor relations enquiries contact:
Hans Zayed
hans.zayed@oci.nl
T +31 (0) 6 18 25 13 67
OCI N.V. corporate website: www.oci.nl
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