«LOOK ING AT SOLVAY D IFFERENTLY»

Transcription

1 «LOOK ING AT D IFFERENTLY»! VALUES AND STRATEGY : S RESPONSE TO A CHANGING WORLD! MAJOR RECENT STRATEGIC CHANGES IN S PORTFOLIO Solvay Group Presentation June 2002

2 CHEMICALS SECTOR PPT / Groupe anglais / ALR /

3 CHEMICALS SECTOR Leadership positions Europe World Fluorinated products (after the acquisition of Ausimont) 2 2 Advanced functional minerals among the world leaders Caprolactones among the world leaders Specialties Sodium bicarbonate 1 2 Ultrapure hydrogen peroxide 2 4 Ultrapure barium/strontium 1 2 Soda ash 1 1 Essentials Hydrogen peroxide 1 1 Persalts 1 1 Barium / Strontium carbonates 1 1 Caustic soda 1 3 Soda ash Salt Caustic soda Barium/Strontium Fluor Hydrogen peroxyde Total 2001 sales : EUR 2,751 M PPT / Groupe anglais / ALR /

4 CHEMICALS SECTOR Major markets in 2001 % of chemicals sales Chemicals industry 24 % Glass industry 22 % Detergents 10 % Paper industry 8 % Construction and civil engineering 6 % Treatment of water and environment 4 % Food industry 4 % Automotive industry 2 % Human health 1 % Electric and electronic industry 1 % Other industries 18% TOTAL 100 % PPT / Groupe anglais / ALR /

5 MAJOR MARKETS OF CHEMICAL PRODUCTS Soda ash Glass industry, chemicals industry, detergents, paper industry, food industry, environmental technologies, pharmaceuticals industry, metallurgy, construction and civil engineering, textile, Fluor Chemicals industry, construction (insulation), automotive industry, pharmaceuticals industry, electronics, metallurgy, Hydrogen peroxide/detergents Chemicals industry, detergents, paper industry, environmental technologies, pharmaceuticals industry, electronics, metallurgy, textile, consumer goods, Barium and strontium Glass industry, chemicals industry, paper industry, electronics, metallurgy, Advanced Functional Minerals Caprolactones Chemicals industry, paper industry, food industry, pharmaceuticals Chemicals industry, shoes industry, resins for surface industry, metallurgy, coating Electrochemistrys/Salt Glass industry, chemicals industry, detergents, paper indsutry, food industry, water treatment and environmental technologies metallurgy, textile, PPT / Groupe anglais / ALR /

6 CHEMICALS SECTOR 2001 Sales breakdown by SBU Soda ash 33% Electrochemistry/salt 30% Sales in 2001 : EUR 2,751 M Hydrogen peroxide/ persalts 15% Fluor products* 12% Barium / Strontium carbonates 6% Advanced functional minerals 3% Caprolactones 1% * without Ausimont (acquired in 2002) PPT / Groupe anglais / ALR /

7 THE CHEMICALS SECTOR STRATEGY 1. INCREASING CONTRIBUTION from SPECIALTIES Fluorinated products, advanced functional minerals, caprolactones, ultra-pure H 2 O 2 and disinfectant, sodium bicarbonate, ultrapure barium and strontium carbonates " 25% of 2001 Chemicals EBIT* 2. LEADERSHIP and COMPETITIVENESS in ESSENTIALS: Soda Ash, Caustic Soda, Barium & Strontium Carbonates, H 2 O 2 3. FULL INTEGRATION in feedstocks : salt, HCl recycling, fluor spath, 4. LESS DEPENDENCE on energy : cogeneration, 5. REDUCTION of CYCLICALITY : reduction of exposure to Electrochemistry and Salt * without Ausimont (acquired in 2002) PPT / Groupe anglais / ALR /

8 THE CHEMICALS SECTOR - in % of EBIT - More balanced portfolio between specialties/essentials 90% 80% 70% 60% 50% 88% 75% 40% 30% 20% 10% 12% 25% 0% Essentials Specialties 1997 Without Ausimont Essentials 2001 Specialties PPT / Groupe anglais / ALR /

9 CHEMICALS 2001 : SALES (+ 6%), EBIT (+ 23%) Resilience to the economic evolution thanks to its specific product mix made of : # SPECIALTIES :! FLUORINATED PRODUCTS : # sales in organic Solkane $ sales in inorganic compounds (weak market conditions)! ADVANCED FUNCTIONAL MATERIALS and CAPROLACTONES : are progressing satisfactorily # ESSENTIALS! SODA ASH : % Europe : strong demand and # prices % USA : still high energy costs but capacity rationalization! CAUSTIC SODA : strong price increase (X2) and cost reduction BUT deteriorating market conditions for HYDROGEN PEROXIDE and BARIUM AND STRONTIUM CARBONATES PPT / Groupe anglais / ALR /

10 MAJOR RECENT ACHIEVEMENTS! Fluorinated activities : & Acquisition of Ausimont & Decision to build a plant (15,000 tons/y) in Tavaux (France) for the large-scale production of Solkane 365mfc (new insulating and blowing agent with no effect on the ozone layer)! Salt : Creation of Esco - European Salt Company & JV with K+S (D) for salt (sold to external customers) in Europe! Sodium bicarbonate : & Decision to build a new sodium bicarbonate production line (80 kt/year) in Spain - operational in October 2002 & Distribution agreement with Takuma (Japan) to market sodium bicarbonate - Bicar - for purifying combustion gases in Japan! Caprolactones : & multi-stage expansion in UK to more than double its capacity for caprolactone polymers over the next 3 years (1 st step in 2002 and further expansions through 2004)! Innovation : financial participation (15%) and research agreement with Ecophos (new approach to the production of upgraded phosphoric acid, using the hydrochloric acid generated by Solvay's production processes)! E-business : two pilot tests on Elemica network - privileged solution for ERP connection with customers and chemical goods suppliers for the order fulfillment PPT / Groupe anglais / ALR /

11 SODA ASH STRATEGY :! to further improve worldwide competitiveness and leadership! to develop specialties Competitiveness and Leadership : N 1 world, N 1 Europe! world leader in the production of soda ash : with sites in Western Europe, Bulgaria and the USA! reduction of costs all over! highest productivity both in US and European plants! cogeneration units on most sites in Europe Specialties! n 2 in the world, N 1 in Europe! development of Bicar : new line in Spain (operational in Oct. 2002)! development of the NEUTREC incineration flue gas cleaning process : RESOLEST platform in France (process and recycle residual sodium chemicals) and partnership Takuma (J) to promote it in Japan! further development of innovative projects : Bicarjet, Ecophos, PPT / Groupe anglais / ALR /

12 1 st WORLDWIDE PLAYER IN SODA ASH - 01/01/ Solvay process Trona 0.0 Solvay FMC Occidental Chemical General Chemical Sterlitamak Brunner Mond IMC CIECH Sisecam American Soda Mio metric tons/year PPT / Groupe anglais / ALR /

13 HYDROGEN PEROXIDE STRATEGY :! to further improve competitiveness through cost reductions and maintain leadership! to further develop high purity grades Competitiveness and Leadership : N 1 world, N 1 Europe! world leader with facilities in Europe, USA, Asia and Brazil! client proximity, first-class logistics and global network of competitively sized production units! reduction of overall costs! new technology to produce propylene oxyde through H2O2 in large chemical processes (200 kt/y) Specialties! electronic grades : % primary use : clean surface of wafers during chip fabrication % customers are highly international! disinfectant : new, higher quality products (ASEPTICPER ) and success of Proxitane AHC brand in Foot & Mouth Disease PPT / Groupe anglais / ALR /

14 GROWTH IN LARGE CHEMICAL APPLICATION to produce Propylene Oxide (PO) in large scale plant Agreement signed with BASF : Solvay would become BASF s partner for the supply of H 2 O 2 for the production of PO "50/50 joint venture (capacity of 200kt/y in a single unit) if BASF decides to implement the H 2 O 2 route to manufacture PO (expected within the next two years) PPT / Groupe anglais / ALR /

15 000 tons st WORLDWIDE PRODUCER IN H 2 O 2-01/01/ Solvay Degussa Atofina FMC EKA Chemicals Kemira Mitsubishi gas Ausimont Oriental chemical Hansol PPT / Groupe anglais / ALR /

16 STRATEGY : ELECTROCHEMISTRY AND DERIVED SPECIALTIES restructuring efforts bearing fruit to concentrate on activities linked to PVC and selected organic compounds Competitiveness and Leadership Competitiveness and Leadership : better focus through!cost reduction measures e.g. decision to concentrate the manufacturing of solid caustic soda in Europe at Jemeppe (Belgium) and Tavaux (France) by end of 2002!conversion from mercury cells to membranes e.g. diaphragm electrolysis at Rheinberg (Germany) to be modernized and partly converted to membrane technology by the end of 2003 PPT / Groupe anglais / ALR /

17 CAUSTIC SODA PRODUCERS 01/01/ Mio tons Nafta Western Europe Asia Pacific Rest of the world Dow Chemical Oxychem Solvay Formosa Plastics PPG Bayer Atofina Ineos Chlor Akzo Nobel Olin PPT / Groupe anglais / ALR /

18 STRATEGY : FLUORINATED PRODUCTS! to further adapt portfolio with new products development! to further develop geographical presence Leadership :! the acquisition of Ausimont makes Solvay one of the world s main producers : with facilities in Europe, North America and Namibia (raw materials)! well diversified portfolio! strong R&D : % HFC : 3rd generation (cell gas for insulation foam, refrigeration, pharma aerosols) % Lithium battery, solvents,...! acquisitions : % AUSIMONT in 2002 % NAFTA : CATOOSA (USA), NORFLUOR (USA) & CHEMTECH (Mexico) % EUROPE : Refrigeration business from Hoechst in 1996 % NAMIBIA : Fluorspar (raw material) in 1997! capacity extensions in growing products % Solkane 134a (for refrigerant) capacity doubled in Germany % Pharmaceutical use of Solkane pilot study for HFC 134a-pharma grade % building of a first industrial-level plant for HFC365mfc used as a blowing agent in polyurethane foams (operational in 2002) PPT / Groupe anglais / ALR /

19 % NV 10 S 141b S 22 S 134a S 142b FLUOR Top products 2001 Leading products S141b (HCFC) Foam S22 (HCFC) Refrigerants/feedstock for PTFE S134 a (HFC) Refrigerants S142b (HCFC) Foam/feedstock for PVDF Nocolok Brazing flux for aluminium-heat exchangers S227 (HFC) Pharma grade and fire extinguishing HF Nocolok Total 2001 : 344 Mio EURO S 227 IXOL SF6 Org. Intermed. S22/ 142b Ambi Cryolith 0 PPT / Groupe anglais / ALR /

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21 FORWARD LOOKING STATEMENT To the extent that any statements made in this presentation contain information that is not historical, these statements are essentially ent forward -look ing. The achievement of forward -looking statements contained in this presentation is subject to risks and uncertainties because of a number of factors, includin g general economic factors, interest rate and foreign currency exchange rate fluctuations; changing market conditions, product competition, the nature of product development, impact of acquisitions and divestitures, restructurings, products withdrawals; regulatory approval processes and other unusual items. Cons equently, actual results may differ materially from those expressed o r implied by such forward -look ing statements. Forward -looking statements can be identified by the us e of words such as "expects," "plans," "will," "believes," "may," "could " "estimates," "int ends", "t arget s", "objectives", "potential ", and ot her words of similar meaning. Should known or unk nown risks o r uncertainties materialize, or should our assumptions prove inaccurate, actual results could vary materially from those anticipated. The Company undertak es no obligation to publicly update any forward -looking statements " and Innovation