EQUATE Group FY 2017 Earnings Presentation March 7, 2018 Starting Shortly Your details go here (24) www.equate.com EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Disclaimer The content of this presentation is for information only, is intended solely for your own and personal reference, and is strictly confidential. Such information is subject to change without notice and its accuracy is not guaranteed and it may not contain all material information concerning the EQUATE Group. We do not make any representation regarding, and assume no responsibility or liability (however arising and regardless of nomenclature) for, the accuracy or completeness of, or any errors or omissions in, any information contained herein. Historical and current performance data are not necessarily indicative of future performance. Materials contained this presentation may contain unaudited financial information and forward-looking statements. While these views are based on current assumptions which are subject to various risks and may change over time. As such we make no representations in respect of the correctness, accuracy, and/or completeness of such assumptions. Further, no assurance can be given that future events will occur, and/or that projections will be achieved. Past performance is not a reliable indication of future performance. Actual results may differ materially from those projected. This presentation shall not be distributed to any third party without the explicit consent of EQUATE Group’s management under any circumstance. Nothing included herein shall be considered, in any way construed, as an offering of securities. The contents of this presentation are disclosed and provided on non- Your details go here (24) reliance basis. www.equate.com EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
EQUATE Group FY 2017 Earnings Presentation March 7, 2018 Your details go here (24) www.equate.com 1 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Agenda Our Shareholders ๏ Group Overview “ EQUATE has a robust shareholder base comprising the Government of Kuwait and ๏ 2017 Financial Results Highlights Dow Chemical, a global industry leader. 57.5% of owners are public shareholding companies. ๏ 2017 Financial Review PETROCHEMICAL INDUSTRIES Co. 42.5% ๏ Outlook and USGC Update THE DOW CHEMICAL COMPANY ๏ Q&A 42.5% BOUBYAN PETROCHEMICAL “ 9% EQUATE is the world’s second largest producer of Ethylene Glycol , the raw material used mainly QURAIN PETROCHEMICAL to manufacture polyester fibers. Your details go here (24) 6% www.equate.com 2 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Group Overview Distribution markets EQUATE Group is a global manufacturer and Kuwait facilities distributor of petrochemical products mainly distribute to Asia and METIP* Germany 76% Polyethylene facilities mainly 7% Global Terephthalate distribute to Europe (100% Produced Product in Germany) Ethylene North America Glycol facilities mainly Mix distribute to North America, Sales Volume South America Canad 4.5 Million Metric Tons and Asia Kuwait a 42% 37% Polyethylene Credit Rating 17% (100% Produced Others in Kuwait) 21% Baa2 Your details go here (24) BBB+ www.equate.com *METIP: Middle East, Turkey, and 3 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com the Indian Subcontinent region
Group Overview - EG Group EG Sales by Region (2017) EQUATE Indian Sub Maintains a 18% North Asia 40% Strong Foothold Europe 13% in Key EG Rest of the Markets World Americas 8% 21% Your details go here (24) www.equate.com 4 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Group Overview - PE Group PE Sales by Region (2017) Indian Sub South 7% East Asia EQUATE is a 16% World Class Europe North 10% Asia Producer of PE 44% MET&A* 23% Your details go here (24) www.equate.com 5 * Middle East, Turkey & Africa EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Financial Results Highlights ($MM) Revenue EBITDA Operating Profit 4,252 1,378 1,730 +67% +47% +20% vs 2016 vs 2016 vs 2016 Net Debt to EBITDA Net Profit 1.5x 1,131 Volume ( ‘000 MT) +66% 4,453 Your details go here (24) vs 2016 www.equate.com 6 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
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2017 Revenue Revenue by Region Revenue by Product A Closer Look Indian North Asia OTHER EG Volume*: 3,390 -2% Sub 35% 5% EG Price: $856 +29% 13% 67% PET PE Volume*: 743 +1% Americas 8% Price: $1,151 +3% 14% Europe PET Volume*: 320 0% PE Rest of 19% Price: $1,106 +15% 20% the world 19% % Change compared to same period last year The group reported FY17 total revenue of $4,252 MM, a 20% increase compared to the same period last year. Your details go here (24) * ‘000 Metric Tons (MT) www.equate.com 8 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Profitability Strong profitability with EBITDA Margin exceeding 40%, driven by operational excellence and effective cost management. Revenue ($MM) EBITDA ($MM) Net Profit ($MM) 4,252 1,131 1,730 3,557 1,176 679 Your details go here (24) www.equate.com 2016 2017 2016 2017 2016 2017 9 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Financial Position ($MM) Net Debt to Cash on Hand Gross Debt Net Debt EBITDA EBITDA USD Million USD Million USD Million USD Million 2,107 4,750 2,643 1,730 1.5x Total Assets Total Liabilities Total Equity 8,584 2,287 6,297 6,015 7,818 1,803 2016 2017 2016 2017 2016 2017 Your details go here (24) www.equate.com 10 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
Cash Flow and Liquidity Cash Flow* Debt Maturity Profile (In $MM) Cash flow from 1,828 operating activities $2 b CAPEX (675) $1 b $1.25 b $1 b $1 b Dividend (679) $0.5 b Term Bond Bond Revolver Sukuk Loan (5yr) (10yr) *Undrawn* $0 b $0 b $0 b $0 b $0 b (7yr) 474 Free cash flow 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Your details go here (24) * Updated 26 March 2018. www.equate.com 11 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
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Price Trend A growing market PE + EG Prices EQUATE Group is strongly 2,000 positioned to capture the 1,600 EG and PE growth prospects, high profitability 1,200 levels and overall stability, 800 leveraging sizeable low PE EG cost competitive 400 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 July-16 Oct-16 Jan-17 April-17 July-17 Oct-17 Dec-17 production capacity, high asset utilization, as well as a global and reliable Your details go here (24) distribution platform. www.equate.com 13 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
USGC Update USGC UPDATE USGC EG CAPACITY EG CAPACITY On line in 2019, US Gulf Coast PLANNED TODAY: in 2019: EG CAPACITY 2,410 KTA 3,160 project presents significant growth 750 KTA opportunity for EQUATE. Key Dates ๏ Leverages Dow’s USGC infrastructure and low -cost, Authorization by EQUATE BOD 26-May-2016 world-scale ethylene ๏ Enables further leveraging of MEGlobal’s distribution Ground Breaking 8-Aug-2016 EPCm Contract Signed 5-Oct-2016 footprint for EG Air Permit Granted 25-Oct-2016 ๏ USGC will further enhance asset mix and profitability Award Site Entrance & Bridge Construction Contract 31-Mar-2017 Award Buildings Design/Build Contract 13-Apr-2017 Award Piling Contract 2-May-2017 Award Cooling Water Tower Contract 30-May-2017 Award HV Substation Design/Build Contract 31-May-2017 3rd Party Terminal Contract Complete 26-Jun-2017 90% of Major Equipment POs Issued 30-Jun-2017 Award Civil Contract 18-Jul-2017 Your details go here (24) Main Scope of Site Development Complete 20-Jul-2017 Site Development Complete 24-Aug-2017 www.equate.com Piling Complete 17-Nov-2017 14 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com Site Entrance Bridge Complete 22-Dec-2017
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Operational 2017 EH&S KPIs Excellence Production 100% of plan In EQUATE, operational Asset Mechanical Reliability 99% AMR excellence in EH&S goes hand in hand with top Recordable Injury Rate, accidents per 200,000 work hours. 0.01 RIR performance in reliability PSCE energy. 1 and assets utilization Process Safety & Containment Event. This applies to containment losses, reactive chemicals events and releases of hazardous process Motor Vehicle Accidents. 1 MVA Safe Work Hours This includes all employees, contractors and visitors 55 million The total of safe work hours without a day away from work case. Your details go here (24) NOV to non-compliance to the environmental regulation ZERO www.equate.com Notice of Violation from EPA or any other regulatory authority due 16 EQUATE Restricted EQUATE Petrochemical Company / www.equate.com
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