K+s Ag · XETR:SDF
K+s — K+S Aktiengesellschaft — Non-Deal Roadshow (June 2016)
34 slides from K+s's roadshow presentation, Jun 8, 2016
Slide 1: Roadshow Lugano
K+S Aktiengesellschaft Roadshow Lugano 8 June 2016 Martin Heistermann, Investor Relations Manager
Slide 2: Content
K+S Group Content A K+S’ Unique Strategic Position 1 Potash and Magnesium Products 2 Salt B Current Trading C Outlook K+S Group 2
Slide 3: Investment Case
K+S Group Investment Case K+S Group Potash and Magnesium Products Salt Business Unit Business Unit Complementary Activities Broad product Geographic Positioned portfolio reach for growth K+S Group 3
Slide 4: Our Products
K+S Group Our Products Potash and Magnesium Products Salt Food processing Industrial products 6% 10% 8% 14% Consumer 44% Specialties 16% Salt for chemical use Industrial KCl (MOP) 56% 46% De-icing in % of sales volumes, FY 2015 K+S Group 4
Slide 5: From Capex to Cash
K+S Group From Capex to Cash Capex Phase Mid-term fundamentals of the potash business remain intact Cash Phase 2020 Net debt Management Agenda Net debt € 2.4 billion < € 2.0 billion Managing Opening Legacy Leverage (LTM) environmental Leverage this summer – challenges 2.5x production of 1st 1.0-1.5x
Slide 6: Content
K+S Group Content A K+S’ Unique Strategic Position 1 Potash and Magnesium Products 2 Salt B Current Trading C Outlook K+S Group 6
Slide 7: Long-Term Dynamics Positive for Fertilizer
Potash and Magnesium Products Long-Term Dynamics Positive for Fertilizer Less arable land – but more protein consumption per capita Jahr 1960 2010 2050 Each year additional 80m people need to Global population be fed – this equals to the population of development Germany 3.0 billion 6.9 billion 9.
Slide 8: Utilizing Entire Range of Minerals in Complex Deposits
Potash and Magnesium Products Utilizing Entire Range of Minerals in Complex Deposits Mineral extraction K+S product offering Health Care & Industrial Fertilizer Nutrition Applications SOP Health Care & Industrial Nutrition Residue products 0.7 63.5% Kieserite Industrial potash Raw Salt KCL (MOP) Kor
Slide 9: Leading Position in Europe
Potash and Magnesium Products Leading Position in Europe Europe Asia South America Other regions K+S Group 9
Slide 10: Our Unique Portfolio Makes Us More Robust
Potash and Magnesium Products Our Unique Portfolio Makes Us More Robust MOP gran. Europe vs. Brazil (Source: FMB) US$/t €/t 600 Brazil 600 (US$/t, Granular, cfr) 500 500 400 400 300 300 Europe (€, Granular, cfr) 200 200 2011 2012 2013 2014 2015 2016 K+S average selling price versus selected peers K+
Slide 11: Strengthening our Global Presence
Legacy Project Strengthening our Global Presence Expanding our current production portfolio in Germany with a North American production site Second source supplier Securing a good asset base with competitive production costs Sales and distribution through existing distribution structures of
Slide 12: Legacy Project: On Time and Budget
Legacy Project On Time and Budget ~ 90% of total CapEx spent Legacy plant Total CapEx of CAD 4.1 billion Port Vancouver 2013 2014 2015 2016 2017 K+S Group 12
Slide 13: Legacy Project Valuation
Legacy Project Valuation Implied Value Per Share (€) Terminal growth rate 0% 2% 7% ~ 21 WACC 8% ~ 11 Volume Volume ramp-up ramp-up (m (m metric metric tons)/ costs per tons) /costs per ton ton (CAD) (CAD) Conservative price assumptions for Legacy based on MOP gran. Brazil ~90 Sustaining capex ap
Slide 14: Content
K+S Group Content A K+S’ Unique Strategic Position 1 Potash and Magnesium Products 2 Salt B Current Trading C Outlook K+S Group 14
Slide 15: Long-Term Dynamics in Salt Demand
Salt Long-Term Dynamics in Salt Demand Demand driven by … Product category Winter weather conditions De-Icing Infrastructure development Consumer Increasing standard of living Food processing Population growth Economic growth and Industrial industrialisation Urbanization Chemical Low single-digit de
Slide 16: Salt: Inevitable for life
Salt Inevitable for life De-Icing Consumer Food processing Industrial Chemical Main Applications: Main Applications: Main Applications: Main Applications: Main Applications: Winter road Table salt Food processing Water treatment Chemical industry maintenance Dishwasher care industry Dr
Slide 17: Unrivalled Global Production Network
Salt Unrivalled Global Production Network Evaluating several opportunities that will enable K+S to grow in Asia More than 30 assets on 3 continents allow close proximity to Competitive edge: customers in a business that is highly freight-cost sensitive Ensuring close proximity to customers Unriv
Slide 18: Diverse Regional and Product Portfolio
Salt Diverse Regional and Product Portfolio Salt for chemical use Food processing Normalized Revenue Industrial Distribution Consumer K+S Group 18
Slide 19: Presence in Attractive De-Icing Markets
K+S Group Presence in Attractive De-Icing Markets Eastern Canada Scandinavia US East Coast Central Europe Great Lakes Indicative regional strength of winter 2010 2011 2012 2013 2014 2015 Europe North America K+S Group 19
Slide 20: 'Salt 2020' Strategy – On Track
Salt ‘Salt 2020’ Strategy – On Track Priority areas GROWTH EFFICIENCY CULTURE Market share growth Fit for the Future Safety first! New segments Business and technical Remove silo thinking New regions processes Transparency/trust Supply chain and High performance and distribution
Slide 21: Expansion into Asia-Pacific: Project Launch in Australia
Salt Expansion into Asia-Pacific: Project Launch in Australia Component of “Salt 2020” strategy Initial focus on obtaining necessary permits CapEx estimate of around € 225 million Estimated production capacity of 3.5 million tons p.a. Main customers in the chemical industry in Asia Possi
Slide 22: Content
K+S Group Content A K+S’ Unique Strategic Position 1 Potash and Magnesium Products 2 Salt B Current Trading C Outlook K+S Group 22
Slide 23: P&L
K+S Group P&L € million FY/14 Q1/15 Q2/15 Q3/15 Q4/15 FY/15 Q1/16 Revenues 3,822 1,377 914 891 993 4,175 1,096 EBIT I 641 317 179 132 154 782 218 t/o insurance gain 36 0 0 0 0 0 0 EBIT I w/o insur. gain 605 317 179 132 154 782 218 Margin 16% 23% 20% 15% 16% 19% 20% Financial result -126 -40 -14 -7 +
Slide 24: Cost Discipline Will Remain High
K+S Group Cost Discipline Will Remain High € million >180 “Fit for the Future” on track More than 2/3 of total >150 aspirations achieved Measures implemented will continue beyond 2016 with full effects until 2018 30 Further top-down measures beyond “Fit for the Future” 2013 2014 2015 2
Slide 25: Cash Flow and Balance Sheet
K+S Group Cash Flow and Balance Sheet € million FY/14 Q1/15 H1/15 9M/15 FY/15 Q1/16 Operating cash flow 707 301 433 630 669 294 - Investing cash flow -1,013 -203 -532 -894 -1,305 -243 (pre sale/ purchase of securities) Adjusted free cash flow -306 98 -93 -264 -636 50 CapEx 1,153 200 555 905 1,279 28
Slide 26: Potash and Magnesium Products
K+S Group Potash and Magnesium Products € million FY/14 Q1/15 Q2/15 Q3/15 Q4/15 FY/15 Q1/16 Revenues 1,884 608 501 471 511 2,091 461 EBIT I 489 183 144 92 127 546 102 t/o insurance gain 34 0 0 0 0 0 0 EBIT I w/o insurance gain 455 183 144 93 127 546 102 Margin 24% 30% 29% 20% 25% 26% 22% t/o Legacy
Slide 27: Salt
K+S Group Salt € million FY/14 Q1/15 Q2/15 Q3/15 Q4/15 FY/15 Q1/16 Revenues 1,779 727 374 382 442 1,925 595 EBIT I 173 142 43 43 39 266 123 Margin 10% 20% 11% 11% 9% 14% 21% Sales volumes (million tons) 23.6 9.1 3.6 3.8 4.7 21.1 7.1 De-icing 14.4 6.9 1.2 1.5 2.3 11.9 4.9 Non de-icing 9.2 2.2 2.4 2.3
Slide 28: Content
K+S Group Content A K+S’ Unique Strategic Position 1 Potash and Magnesium Products 2 Salt B Current Trading C Outlook K+S Group 28
Slide 29: Guidance FY 2016: EBIT I Bridge
K+S Group Guidance FY 2016: EBIT I Bridge € million Assumptions (highlights) Prices for MOP in overseas markets continue to stabilize. However, 782 significantly lower average selling price expected in potash for FY 2016 Impact of limited deep-well injection may be felt more in upcoming dry Ma
Slide 30: Dividend Increase of 28% for 2015
K+S Group Dividend Increase of 28% for 2015 50% 10% Target payout ratio of 40-50% 45% Earnings-based dividend policy 40% 8% Payout ratio of 40 – 50% of 35% adjusted net profit 30% 6% Dividend 2015: € 1.15 per share 25% (2014: € 0.90 per share) 20% 4% 15% 10% 2% 5% 0% 0% 2011 2012 2013 2014 201
Slide 31: IR Contact Details
K+S Group IR Contact Details K+S Aktiengesellschaft Bertha-von-Suttner-Str. 7 34131 Kassel (Germany) E-Mail: [email protected] Homepage: www.k-plus-s.com IR-website: www.k-plus-s.com/en/ir Thorsten Boeckers Andrea Rach Head of Investor Relations Investor Relations Assistant Phone: +49
Slide 32: Forward-Looking Statements
K+S Group Forward-Looking Statements This presentation contains facts and forecasts that relate to the future development of the K+S Group and its companies. The forecasts are estimates that we have made on the basis of all the information available to us at this moment in time. Should the assumptio
Slide 33: K+S Group
K+S Group
Slide 34: K+S Share, ADR and Bond Information
K+S Group K+S Share K+S ADR K+S Bond 06/2022 K+S Bond 12/2018 K+S Bond 12/2021 • WKN: KSAG88 • CUSIP: 48265W108 • WKN: A1P GZ8 • WKN: A1Y CR4 • WKN: A1Y CR5 • ISIN: DE000KSAG888 • ADR Ticker-Symbol: • ISIN: DE000A1PGZ82 • ISIN: XS0997941199 • ISIN: XS0997941355 • Ticker-Symbols: Bloomberg: KPLUY / B
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