Saudi Arabian Mining Co. · TADAWUL:1211
Saudi Arabian Mining — Q3 2020 Earnings Presentation
37 slides from Saudi Arabian Mining's earnings presentation, December 2020
Slide 1: Growing a Saudi Global Mining Giant – Q3 2020 Results
Growing a Saudi Global Mining Giant Saudi Arabian Mining Company (Ma’aden) Investor Presentation – Q3 2020 Results
Slide 2: Frederik Michaelsen, Senior Investor Relations Advisor
Growing a Saudi Global Mining Giant Frederik Michaelsen Senior Investor Relations Advisor
Slide 3: Disclaimer
Disclaimer This presentation contains statements that are, or may be deemed to be, forward looking statements, including statements about the beliefs and expectations of the Saudi Arabian Mining Company Ma’aden (the "Company"). These statements are based on the Company's current plans, estimates and
Slide 4: Mosaed Sulaiman Al Ohali, Chief Executive Officer
Mosaed Sulaiman Al Ohali Chief Executive Officer 4 of 40
Slide 5: Ma'aden's 2025 Strategy
Ma’aden’s 2025 Strategy “Sustainable mining champion with global presence” Pillar 1: Operational, capital and Pillar 2: National mining champion Pillar 3: Global presence Foundations : Sustainability and commercial excellence capability building • Enhance competitiveness • Grow sustainably phosphate
Slide 6: Ma'aden's Growth Since Its Inception
MAADEN’S GROWTH SINCE ITS INCEPTION 70 MPC Sukuk MWSPC Sales, SAR mn Commercial Capital 17,736 Production Increase 60 Start 460 Ad Duwayhi Commercial Covid 50 Commercial Production 19 2008 2019 Starting Rights issue Production of Start Effect Aluminum Aluminum Operation Smelter MA’aden MPC 40 announ
Slide 7: Ma'aden outperformed peers and the market
Ma’aden’s outperformed peers and the market Ma’aden 2019 Equity Share price returns (indexed to 100) increase (Debt for Equity swap) Annualized return since the IPO 260% (in percent) 240% Ma’aden 2014 220% Rights issue 200% 250 M Share 180% Ma’aden 9.4% 160% Mining Giants1 7.0% 140% Ma’aden 120% Pur
Slide 8: Health, Safety, Security & Environment (HSSE)
Health, Safety, Security & Environment (HSSE) 8 of 40
Slide 9: SafeSTEPS Change Management Strategy
SafeSTEPS Change Management Strategy EHSS Risk Learning From Contractor Leadership Management Incidents Management Focus Areas HSE Mgt. Sustainability Safety Performance System management Governance Management Safety Culture Process Enablement Leaders drive the positive safety culture at Leaders pro
Slide 10: TRIR Performance
TRIR Performance TRIR Ma'aden Contractor Combined 0.39 0.41 0.37 0.38 0.31 0.29 0.27 0.24 0.23 2017 2018 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2020 Q3 • Average for Mining, Quarrying, and Oil Extraction: 1.2 in 2019 • Average for Utilities: 2.2 in 2019 • Average for Manufacturing: 3.3 in 2
Slide 11: Covid-19 Update
Covid-19 Update 11 of 40
Slide 12: Ma'aden COVID-19 Update
Health Ma’aden COVID-19 Update Analysis • Though the overall trend of the infection rate is gradually declining, but the threat of COVID-19 is still not over. Continue Focus on SOP compliance at work and enhance awareness on implementing SOPs outside the workplace. 12 of 40
Slide 13: Q3 2020 Update
Q3 2020 Update 13 of 40
Slide 14: Q3-2020 Production Update
Q3-2020 Production Update Higher production in all products (ex gold) • Ammonium Phosphate production was 1,397kt (flat y-o-y and up 13% q-o-q) Production • Ammonia production was 603kt (up 33% y-o-y and up 7% q-o-q) • Aluminum production was 251kt (up 2% y-o-y and down 1% q-o-q) • Alumina productio
Slide 15: Q3-2020 Financial Performance Update
Q3-2020 Financial Performance Update Higher sales and EBITDA, lower net loss • Sales was SR4.7bn; up 16% q-o-q, due to higher prices effect except FRP, combined with Financial higher sales volume of APF, primary aluminum and flat rolled products and higher Meridian Performance sales; up 8% y-o-y, du
Slide 16: Market Prices & Outlook
Market Prices & Outlook 16 of 40
Slide 17: Q3 2020 - Phosphate & Ammonia Prices
Q3 2020 - Phosphate & Ammonia Prices A good quarter for both, Phosphate and Ammonia prices Market Dynamic • India was active during Q3 to cover Kharif season (Jul-Oct) • Healthy Brazilian farmers economics driven by strong crop $450 prices and the encouraging exchange rate • North America prices sur
Slide 18: Q3 2020 - Aluminum & Alumina Prices
Q3 2020 - Aluminum & Alumina Prices Faster demand recovery, LME Prices continue on an uptrend Aluminium $2,400 $600 • LME cash prices rose steadily in Q3 following a fast recovery $2,300 in Chinese demand $550 $2,200 • Prices remained supported as global manufacturing index $500 returned back to exp
Slide 19: Q3 2020 - Gold & Copper Prices
Q3 2020 - Gold & Copper Prices Gold price climbed higher; Copper recovered $2,100 $7,500 Gold $2,000 • Uncertainty over COVID-19 amidst resurgence $1,900 $7,000 across Europe and in the US, financial stimulus $1,800 packages, negative yields and interest rate cuts, $6,500 global central bank easing,
Slide 20: Consolidated Key Financial Results
Consolidated Key Financial Results net loss of SR99mn due to the following: - Increase in sales volumes impacted the bottom-line by SR126mn and SR177mn compared to last quarter and same quarter last year. - Improved commodity prices impacted the bottom-line positively by SR281mn and negatively by SR
Slide 21: Q3-20 net loss is lower than Q2-20
Q3-20 net loss is lower than Q2-20 SRmn Movement in net profit by line items (q-o-q) Profit / (Loss) attributed to the shareholders’ of parent co. Mainly due to: Profit / (Loss) attributed to minority interest ▪ MWSPC amortized Increase in: cost & agent fee one ▪ APF 267m off impact 71m increase in
Slide 22: Q3-20 net loss is lower than Q3-19
Q3-20 net loss is lower than Q3-19 SRmn Movement in net profit by line items (y-o-y) Profit / (Loss) attributed to the shareholders’ of parent co. Mainly due to decrease in: Profit / (Loss) attributed to minority interest ▪ MPC loan repayment 34m Increase in: ▪ MWSPC early ▪ Amm. by 148kmt 103m sett
Slide 23: Consolidated Sales and EBITDA by Segment
Consolidated Sales and EBITDA by Segment Consolidated Phosphate vs. vs. vs. vs. Q3-20 LY Qtr. Prev. Qtr. Q3-20 LY Qtr. Prev. Qtr. Sales (SRmn) 4,659 8% 16% Sales (SRmn) 2,285 18% 40% EBITDA* (SRmn) 1,470 2% 37% EBITDA* (SRmn) 691 27% 107% EBITDA margin 32% -2% 5% EBITDA margin 30% 2% 10% 47% of Grou
Slide 24: Quarterly EBITDA and EBITDA margins
Quarterly EBITDA and EBITDA margins EBITDA margin continues to improve in 2020 55% 52% 53% 50% 51% 47% 43% 44% 1,966 33% 33% 32% 1,815 30% 29% 1,727 1,681 27% 25% 1,504 1,541 1,428 1,439 1,416 1470 1,345 1,392 1,310 1,091 1,069 EBITDA (mn SR) EBITDA Margin 24 of 40
Slide 25: Consolidated Cash Flow Chart
Mainly capex in: ▪ Ammonia 3 -540m ▪ MGBM -367m ▪ MPC -86m Consolidated Cash Flow Chart ▪ MWSPC ▪ MAC -85m -70m ▪ Others -57m SRmn For quarter ended 30 September 2020 Depreciation and amort'n. 1,220 Finance costs paid -273 Prov. for emp. benefits 50 Zakat and income tax paid -193 Finance charges acc
Slide 26: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement Higher cash generated from operating activities in Q3 2020 Q3 Q2 Q3 Comparative analysis 2020 2020 2019 Cash generated from operating activities 689 503 573 Cash utilized in investing activities (593) (651) (499) Cash generated from financing activities (450) (454) (
Slide 27: Financial Ratios
Financial Ratios Q1 - 2020 Q2 - 2020 Q3 - 2020 Return on total assets (ROA) (%) 0.5% 0.2% 0.2% Return on total assets excl. CWIP (ROA) (%) 0.5% 0.2% 0.3% Profitability Return on total equity (ROE) (%) -5.1% -5.6% -4.7% EBITDA margin 25.1% 24.3% 33.9% ROIC 0.6% 0.2% 0.3% Asset turnover 0.18 0.18 0.18
Slide 28: Operational Performance
Operational Performance 28 of 40
Slide 29: Phosphate & Ammonia: Q3-2020 Production & Sales
Phosphate & Ammonia: Q3-2020 Production & Sales Ammonium Phosphate Fertilizer Ammonia 700 603 1,450 1,420 563 1,393 1,407 1,397 600 1,400 455 500 1,350 400 336 328 1,300 1,280 300 1,233 179 1,250 200 1,200 100 1,150 0 Q3 2019 Q2 2020 Q3 2020 1,100 Q3 2019 Q2 2020 Q3 2020 Production (in kmt) Sales (i
Slide 30: Aluminum & Alumina: Q3-2020 Production & Sales
Aluminum & Alumina: Q3-2020 Production & Sales Aluminum Alumina 254 472.0 255 500.0 447.0 251 251 251 429.0 250 400.0 246 244 300.0 245 200.0 240 64.0 70.0 100.0 34.0 235 0.0 Q2 2019 Q1 2020 Q2 2020 Q3 2019 Q2 2020 Q3 2020 Production (in kmt) Sales (in kmt) Production (in kmt) External Sales (in kmt
Slide 31: Gold & Copper: Q3-2020 Production & Sales
Gold & Copper: Q3-2020 Production & Sales Gold Copper 140.0 10.0 9.4 115.0 116.0 7.9 120.0 105.0 105.0 7.5 7.7 8.0 6.7 100.0 91.0 91.0 6.6 80.0 y-o-y q-o-q 6.0 60.0 Prod -13% -21% 4.0 40.0 Sales -13% -22% 2.0 20.0 0.0 0.0 Q3 2019 Q2 2020 Q3 2020 Q3 2019 Q2 2020 Q3 2020 Production (in koz) Sales (in
Slide 32: Summary
Summary 32 of 40
Slide 33: Q3-2020 Summary
Q3-2020 Summary 6mn SAR profit to our shareholders in Q3 (vs. a loss of 423mn in Q2) The net loss of SR99mn is much smaller than Q2’s 728mn • Increase in sales volumes impacted the bottom-line by SR126mn vs. Q2 Increase in both, sales volumes • Improved commodity prices impacted the bottom-line posi
Slide 34: Q&A
Q&A 34 of 40
Slide 35: Appendix
Appendix 35 of 40
Slide 36: Debt repayment profile
Debt repayment profile Schedule debt repayment profile, in mn USD 3,000 USD Millions MIC MGBM MWSPC MBAC MRC MAC MPC Pre-Refinance Repayment 2,500 2,000 1,500 1,000 500 - 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 36 Earnings Conference Call – YE 2019 36 of 40
Slide 37: Thank You
Growing a Saudi Global Mining Giant Thank You
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