Notore Chemical Ind — Notore Chemical Industries — Investor Presentation (August 2018)
36 slides from Notore Chemical Ind's investor presentation, August 2018
Slide 1: Notore Chemical Industries Plc Introductory Investor Presentation
Strictly private and confidential Notore Chemical Industries Plc Listing by Introduction on The Nigerian Stock Exchange Introductory Investor Presentation August 2018 Champion of the African Green Revolution
Slide 2: Outline
Outline Page # 1 Overview of Notore Chemical Industries Plc 3 2 Operating Environment 15 3 Corporate Strategy and Business Outlook 21 4 Financial Performance 28 5 Listing Summary 30 A Appendix 33 2
Slide 3: 1. Overview of Notore Chemical Industries Plc
1. Overview of Notore Chemical Industries Plc
Slide 4: Notore Chemical Industries Plc at a Glance
Notore Chemical Industries Plc at a Glance 100% 99% 99% 99% 99% Notore Supply & Notore Power Notore Seeds Notore Foods Notore Industrial City Trading Mauritius Limited Limited Limited Limited Limited Shareholding Structure Notore is a vertically integrated agro-allied, chemical and power business
Slide 5: Our Value Proposition
Our Value Proposition Production and sale of urea, ammonia and NPK Develops and markets Notore branded improved blend fertilizers - Current production design maize and rice (Nigeria’s staple crops) seed capacity of 500,000mtpa (urea). varieties. Only urea producer in sub-Saharan Africa with
Slide 6: History and Key Milestones
History and Key Milestones 1983: NAFCON 500,000mt 2012: Notore enters into a JV 2013: Notore records profit in capacity fertilizer plant was agreement with Mitsubishi excess of N1bn for the 9 built by the FGN. Corporation to develop new months period ended 1999: NAFCON plant was shut fertilizer plan
Slide 7: Strong Leadership Team with Extensive Experience
Strong Leadership Team with Extensive Experience Mr. Onajite Paul Okoloko Group Managing Director/ Chief Executive Officer Mr. Femi Agbaje Mrs. Otivbo Saleh Mr. Bode Agagu Mr. Femi Solebo Ms. Ivana Osagie Mr. Bolarin Tolujo Executive Director & Group Chief Legal/ Group Chief MD, Notore Power MD, Not
Slide 8: Achievements since Takeover from NAFCON: Improved infrastructure (1/3)
Achievements since Takeover from NAFCON Improved infrastructure (1/3) Before After 8
Slide 9: Achievements since Takeover from NAFCON: Improved infrastructure (2/3)
Achievements since Takeover from NAFCON Improved infrastructure (2/3) Before After 9
Slide 10: Achievements since Takeover from NAFCON: Improved infrastructure (3/3)
Achievements since Takeover from NAFCON Improved infrastructure (3/3) Before After 10
Slide 11: Operational Overview: Production
Operational Overview: Production MANUFACTURING STAGE I – AMMONIA PLANT PROCESS ( INITIAL STAGE PROCESS) Natural gas is a key feedstock in the production of fertiliser, and as such, any disruption in gas supply will Ammonia is produced via a significantly affect production volumes, as seen betwee
Slide 12: Operational Overview: Distribution
Operational Overview: Distribution “ Notore’s distribution platform Route to Market aims to provide resource poor farmers with farm inputs and 350+ 70+ 3,000+ 14mn+ education on farming best practices for improved yields. North Africa ” North America West Africa Distribution Agro Dealers (AD), Notor
Slide 13: Our Contributions to National Agricultural Transformation
Our Contributions to National Agricultural Transformation • Notore worked with state governments and non- governmental organizations to develop fertilizer voucher programs in Kano, Kwara and Bauchi states between 2009 and 2011. The successes achieved became the basis of the Growth Enhancement Scheme
Slide 14: Key Investment Highlights
Key Investment Highlights Notore’s key strength lies in its huge potential to diversify its revenues due to its favourable location within a prolific gas hub and access to a jetty, which guarantees easy export of any products manufactured in the facility. Strategically located in the Free Zone Devel
Slide 15: 2. Operating Environment
2. Operating Environment 15
Slide 16: Nigerian macroeconomic and demographic overview
Nigerian macroeconomic and demographic overview Nigeria still remains Africa’s largest economy despite the recent economic slowdown - buoyed by a growing population of c.187 million with a median age of 18 to drive volumes. Household spending expected to grow by US$26bn Middle class from 2015 - 2020
Slide 17: Global Market Demand for Fertilizer (1/2)
Global Market Demand for Fertilizer (1/2) Commentary Global Demand for Fertilizer Nutrients % of Global Demand by Region (2017E) In million tonnes The agriculture sector remains key to 57% providing food security to the over 7bn 35 36 37 33 33 34 people across the globe. - Total fertilizer nutrien
Slide 18: Global Market Demand for Fertilizer (2/2)
Global Market Demand for Fertilizer (2/2) Commentary Global Urea Usage Price Movement of Natural Gas vs. Urea Capacity utilisation for urea plants has 95% 600 10 declined since 2011 from 86% to 73% in 2018. There is an overcapacity of urea 8 globally, largely attributable to increased 86% 86% 400
Slide 19: Local Market Demand for Fertilizer
Local Market Demand for Fertilizer Commentary Fertilizer usage across Nigeria Fertilizer Consumption in Nigeria Agriculture accounts for 20% of Nigeria’s Proportion of plots using some fertilizer Kg/hectare of arable land Key Statistics GDP and statistics shows how far the sector 20 has declined o
Slide 20: Critical success factors in the Nigerian urea fertilizer market
Critical success factors in the Nigerian urea fertilizer market Local Due to the low cost of urea production in Nigeria (for producers with low cost of natural gas) compared to the global market, urea prices are mainly driven by local Producers producers, providing a competitive cost advantage ove
Slide 21: 3. Corporate Strategy and Outlook
3. Corporate Strategy and Outlook
Slide 22: Creating Africa's Green Evolution
Creating Africa’s Green Evolution 1 2 3 Providing Quality Providing Education Creating Markets Agro Inputs to Optimize Yields for Quality Output Notore Fertilizer Notore Agricultural Services Notore Foods Pioneer Producer of Premium Quality Education to Optimize Yields. Designed to create read
Slide 23: Where We are Today
Where We are Today 1 Operations Notore’s urea plant currently produces c.1,000mt of urea fertilizer on a daily basis. The fertilizer plant is due for a Turn-Around Maintenance (“TAM”) program to restore its production capacity to 1,500mtpd (i.e. its design capacity). Notore sells 75% of its urea
Slide 24: Notore's Historical Performance and Recent Turnaround
Notore’s Historical Performance and Recent Turnaround Year FY 2014 FY 2015 FY 2016 FY 2017 9M 2018 Duration 12 Months 12 Months 12 Months 12 Months 9 Months Operations Ammonia Produced 133,486mt 152,300mt 189,961mt 203,223mt 127,573mt Urea Produced 200,547mt 209,459mt 271,845mt 315,298mt 198,476mt U
Slide 25: Justification for achieving plant design capacity Post-TAM
Justification for achieving plant design capacity Post-TAM 2013 2014 2015 Non-availability of gas for Non-availability of gas for Steady gas supply for a 97 days leading to 137 days leading to major part of 2015, surplus thermal cycles surplus thermal cycles however, some shutdowns and eventual and
Slide 26: Potential incremental revenue Post-TAM
Potential incremental revenue Post-TAM In order to improve Notore’s cashflows, it is imperative that the plant sustains 1,500mtpd of urea production annually in order to meet its 500,000mtpa design capacity. The diagram below shows key immediate priorities which require cash injection and will u
Slide 27: Looking into Notore's Future
Looking into Notore’s Future…. 1 2 Short Term Medium Term Notore has secured approval for US$37mn facility to fund Develop new compound fertiliser blends specifically for the TAM, acquire and install back-up power supply and key growth crops, expand the Company’s seed business acquire critical p
Slide 28: 5. Financial Overview
5. Financial Overview
Slide 29: Financial Snapshot
Financial Snapshot Revenue by Segment (N’bn) Profit After Tax Fixed Assets vs. Total Assets 16.6 16.3 25.2 35.9 20.6 ₦’billions ₦’billions 8.7 0.2 153.3 147.2 150.5 1.1 0.2 0.2 0.6 35.7 2014 2015 2016 2017 9M'18 0.5 0.9 91.0 86.8 24.1 20.4 -3.9 125.7 15.5 15.2 117.9 114.2 61.4 58.3 2014 2015 2016 20
Slide 30: 6. Listing Summary
6. Listing Summary
Slide 31: Listing Summary
Listing Summary Issuer Notore Chemical Industries Plc Industry Industrial Goods Sub-Industry Agro-Allied & Chemicals Transaction Description Listing of 100% of the issued and paid-up ordinary shares of Notore on the Mainboard of The Nigerian Stock Exchange Listing Mode By way of Introducti
Slide 32: Objective of Notore's Listing on the NSE
Objective of Notore’s Listing on the NSE Support the Nigerian Government’s effort to deepen the capital markets Improve the liquidity and tradability of the Company’s shares Increase the Company’s visibility and credibility in the Nigerian market and beyond Increase access to capital in order to fun
Slide 33: A. Appendix
A. Appendix
Slide 34: Summary Historical Financials
Summary Historical Financials Year FY 2014 FY 2015 FY 2016 FY 2017 9M 2018 Period 12 Months 12 Months 12 Months 12 Months 9 Months Income Statement NGN’000 NGN’000 NGN’000 NGN’000 NGN’000 Revenue 16,571,954 16,276,760 25,201,505 35,893,598 20,583,647 Cost of Sales (16,913,775) (15,609,164) (18,276,8
Slide 35: Disclaimer
Disclaimer This Investor Presentation has been prepared by Notore Chemical Industries Plc (“Notore” or “NCI” or the “Company”) solely to provide information to the recipient (the “Recipient”) about its business in connection with its Listing by Introduction on The Nigerian Stock Exchange (the Listin
Slide 36: Thank you
Thank you
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