Mexichem Day
February, 2011
Agenda
1)
Welcome and Introduction of the Management Team
Ricardo Gutiérrez, President of the Executive Committee
2)
Mexichem Today
Enrique Ortega, Planning & RI Director
3)
Triple Results
Enrique Ortega, Planning & RI Director
4)
Vision 2011 – 2015
Rafael Dávalos, Director General
5)
Antonio del Valle, President of the Board of Administration
6)
Q&A
Organizational Chart
Ricardo Gutiérrez
President of the
Executive
Committee
Rafael Dávalos
Director General
Carlos Manrique
Chlorine- Vinyl
Chain Director
Héctor Valle
Víctor Aguilera
Fluorine Chain
Director
Integral Solution
Chain Director
Miguel Ruiz
Finance Director
Enrique Ortega
Planning &RI
Director
Mexichem Today
Mexichem – An Overview
Three Business Units
in One
I
Integral Solutions
(PVC Piping)
• Fully integrated piping
producer – the largest in
Latin America
• 55 thousand Points of
Sale in Latin America
II
Chlorine - Vinyl
(PVC Resin)
• The largest producer of
Polyvinyl Chloride (PVC)
in Latin America.
• Regional leader in
chlorine and caustic
soda production.
III
Fluorine
( Refrigerants)
• The largest fluorite
mine in the world.
• World’s largest
hydrofluoric acid
producer .
• The only integrated
refrigerant producer in
America.
Mexichem – An Overview
CONSOLIDATED INDICATORS
Sales (US$ millions)
2003
CONSOLIDATED INDICATORS
$258.7
Sales (US$ millions)
2010
$2,881
EBITDA (US$ millions)
$47.7
EBITDA (US$ millions)
$642
Net Debt (US$ millions)
$93.0
Net Debt (US$ millions)
$945
Companies
5
Companies
75
Employees
1,789
Employees
11,060
Plants
Countries where we operate
Capex for growth (US$ millions)
10
2
$25
Market Cap MX Stock Exchange (US$ millions) $115.6
Position in the MS Stock Exchange (BMV)
75
Plants
48
Countries where we operate
18
Capex for growth (US$ millions)
$2,000
Market Cap MX Stock Exchange (US$
millions)*
$6,360
Position in the MS Stock Exchange (BMV
9
Fundamental Strategies
Vertical Integration Growth
Leadership
Solid Financial Structure
Culture
Triple Result
Vertical Integration-Based Imperative Growth
Chlorine &
Caustic Soda
Salt
ChlorineVinyl
Fluorine
Chemicals
Unión Minera del
Sur
• Quimir
• Mexcol
Fluorite
VCM
Contrats w/
•OXY,
Dow
Chemical &
PEMEX
Hydrofluoric Acid
Verde fluorite
• Río
• Expansion TO
1MM MT
• Primex
• Petco
• Policyd
Fluorocarbonos
Integral Solutions
• Amanco
• Tuflex
• Plastubos
• Plásticos Rex
Fluoroelastomers
• Bidim
• Colpozos
Fluoropolymers
Florine
• Ineos
acquisition
chemicals
• Fluorine
purifier
• Fluorite
• Aluminum Fluoride
• Sulfur mine
PVC Resin
Mexichem has invested more than US$2.0 Bn
to implement its vertical integration strategy
Upstream
Chain
Chlorine-Vinyl
•
•
chlorine
caustic soda
Midstream
•
Greater
Volatility
•
Fluorite
28% Sales ($)
•
•
Hydrofluoric Acid
27% Sales ($)
PVC piping and other
products
47 % Sales ($)
31% Sales ($)
22% Sales ($)
Fluorine
Chemicals
PVC resin
Downstream
•
Aluminum fluoride
/Fluorocarbons
45% Sales ($)
Less
Volatility
Market Share
Indisputable Leader in
the Markets where we
operate
Solid Financial Structure
Gross
Terms
Currencies
Debt
Short
Term
Long term
Total
(US$ mm)
%
US$
Other
Total
(US$ mm)
Bank Debt
180
732
912
63%
607
305
912
Bonds
-
546
546
37%
346
200
546
Total
180
1,278
1,458
100%
953
505
1,458
%
12%
88%
100%
65%
35%
100%
75% of our consolidated sales are in US Dollars
Net Debt / EBITDA
Interest Coverage
2.5
14
12
1.7
2
1.44
1.3
1.5
10
6.4
8
1.02
6.6
7.2
6.5
6
1
0.5
12.7
0.4
4
2
0
0
2006
2007
2008
2009
2010
2006
2007
2008
2009
2010
Cultura Mexichem
Mexichem resulted from acquisitions (+75) in different counties with different languages
VISION
To be globally respected and admired as a leading chemical company that focuses on
producing results, contributing to progress, and improving people’s lives.
MISSION
To transform chemicals into innovative products, services, and solutions for various
industries, through operational excellence and market focus in order to generate
continuous value for our clients, collaborators, partners, shareholders, and the
community, thereby contributing improve the quality of people’s lives.
Results
Oriented
Leadership
Integrity
Commitment
VALUES
Responsibility
Safety
Triple Results
VISION
MISSION
SHARED VALUES
Environmental
TRIPLE
RESULTS
Social
Economical
Triple Results
Environmental
Project
Country
Plant
Mercury decontamination of the soil in the electrolisis area: 2,900 m2;
volume: 10,410 m3
Mexico
Santa Clara
The fluidized bed on the KP3 line was substituted to reduce noise at
the compound plant.
Mexico
Altamira I
Increase cooling capacity of the feed-effluents into the biological
reactor to safe temperature ranges.
Mexico
Altamira I
First stage of environmental sanitaton
Mexico
SLP mine
Sludge recovery and drying at the EPVC effluent treatment plan.
Colombia
Mexichem
Wastewater treatment
Guatemala
Mexichem
US$ 9,222,170 were invested in Q4 out of a total investment in 2010 of
US$18,444,340
Triple Results
Project
Social
Country
Plant
England
Mexichem UK
Pubic spaces were adapted for school-children recreation and sports
activities.
Colombia
Mexichem
Clean School Certification. This was the second certificate of this kind
granted in the country and the second obtained by the state of
Tlaxcala.
Mexico
Mexichem Resinas
It’s never too late to learn. The Adult Education School facilities in
Melchor Ocampo, State of Mexico underwent improvements.
Mexico
Químir
School Program
US$355,602 were invested in Q4 from a total investment in 2010 of US$1,422,406.
An important part of the contributions we make to the community come from the
time and talent of our people who work directly with the communities.
Economical
Triple Results
Fourth Quarter
Consolidated Millions of MXP
2010
2009
% Var.
2010
2009
% Var.
Net Sales
9,499
8,052
18.0%
36,477
30,647
19.0%
Gross Profit
2,939
2,677
9.8%
12,373
10,787
14.7%
Net Majority Profit
724
716
1.1%
3,693
2,954
25.0%
EBITDA
1,773
1,339
32.4%
8,123
6,175
31.5%
Free Cash Flow
1,322
1,022
29.4%
6,530
4,500
45.1%
9
40
7.9 8.1
EBITDA 12M
Billions of MXP
35
7.1
6
5.3 5.3
5.7
35
Billions of MXP
30
6.6
7
Sales 12M
7
8
9
1Q06
1.3
0.9 1.1
7
9
3Q05
10
4Q04
10
11
5
Primex Acquisition
Bayshore Acquisition
Amanco Acquisition
Petco Acquisition
4Q10
3Q10
1Q10
3Q09
2Q09
1Q09
4Q08
3Q08
2Q07
4Q06
4Q10
3Q10
1Q10
3Q09
2Q09
1Q09
4Q08
3Q08
3Q07
2Q07
4Q06
1Q06
3Q05
1Q05
4Q04
3Q04
3Q06
Fluorine Chemical
Acquisition
3Q06
0
0
1Q05
1
1.8
2.1
15
2.8
3Q04
2
17
3.6
2.4 2.5
31 31
19
20
3
32 32
25
5
4
31
36
30
6
3Q07
8
January-December
2011 Results Guidance
Sales
$US millons
2010
$2,881
2011
$3,331
EBITDA
% vs 2010
16
$US millions % vs 2010
$642
$780
22
Acquisitions
Investment
$US millions
$605
$850
Mexichem Today
Today’s Petrochemical Sector
Soda
Salt
Phosphates
Chlorine
Compounds
Ethane
Ethylene
VCM
PVC
Cables
Polyolefins
Piping
Profiles
Mexichem Products
Chlorine – Vinyl Chain
$3,789.9
$4,000.0
- 2015
Sales 2006 - 2011
$3,158.3
$2,631.9
$3,000.0
$2,000.0
$1,827.7
$739.0
$1,208.2
$1,579.5
$1,217.1
$2,193.2
$1,414.7
$1,000.0
$0.0
2006
2007
2008
2009
2010
2011
2012
2013
2014
$660.6
$800.0
$600.0
2015
$550.5
EBITDA 2006 -- 2011
2015
$458.8
$318.6
$400.0
$206.1
$224.5
$234.2
$382.3
$220.6
$153.6
$200.0
$0.0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Chlorine Vinyl Chain - 2015
Soda
Salt
Phosphates
Chlorine
Ethane
Ethylene
VCM
PVC
Polyolefins
Mexichem Products
Compounds
The Fluorine Chain Today
Sulfur
Fluorite
Sulfuric Acid
TCE
HF
Refrigerant
Gases
Aluminum
Fluoride
Mexichem Products
Fluoro elastomers
Fluor polymers
The Fluorine Chain
$1,600.0
$1,382.1
Sales 2006 - 2011
- 2015
$1,151.7
$959.8
$1,200.0
$799.8
$578.4
$800.0
$400.0
$160.6
$186.7
$192.8
$666.5
$188.1
$0.0
2006
2007
2008
2009
2010
2011
2012
2013
2014
$600.0
2015
$466.6
EBITDA 2006 -- 2011
2015
$388.8
$324.0
$400.0
$218.1
$200.0
$72.4
$82.3
$55.4
$225.0
$270.0
$89.9
$0.0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
The Fluorine Chain - 2015
Sulfur
Fluorite
Sulfuric
Acid
TCE
HF
Refrigerant
Gases
Aluminum
Fluoride
Mexichem Products
Fluoroelastomers
Fluoropolymers
MSI Chain - Today
Cement
Marketing
Technology
Product
Portfolio
Product
Technology
Mexichem Products
Construction Materials
Distribution
Network
Panels
Copper Piping
PP Piping
PVC Piping
PE Piping
Profiles
Coatings
Other Materials
MSI Chain
$3,088.3
$3,000.0
$2,573.6
Sales 2006 - 2011
- 2015
$2,144.7
$1,787.2
$2,400.0
$1,289.8
$1,800.0
$1,120.3
$1,286.2
$1,489.4
$864.6
$1,200.0
$600.0
$0.0
$0.0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
$518.4
$600.0
EBITDA 2006 -- 2011
2015
$432.0
$400.0
$250.0
$213.5
$207.2
$300.0
$360.0
$224.8
$128.5
$200.0
$0.0
$0.0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
MSI Chain - 2015
Cement
Marketing
Technology
Product
Portfolio
Product
Technology
Mexichem Products
Construction Materials
Distribution
Network
Panels
Copper Piping
PP Piping
PVC Piping
PE Piping
Profiles
Coatings
Other Materials
Mexichem 2011-2015
Chain
Sales 2011
US$*
EBITDA
US$*
Sales 2015
US$*
EBITDA
US$*
Chlorine - Vinyl
1,827.7
318.6
3,789.9
660.6
Fluorine
666.5
225.0
1,382.1
466.6
Integral Solutions
1,489.4
$250.0
3,088.3
518.4
Deletions/
Holding
-651.8
-13.6
-1,322.0
-30.0
Consolidated
3,331.7
780.0
6,938.3
1,615.6
*millions of Dollars
Total Investment US$3 Billion
Thank You