BASF Monomers Division Excellence in Commodities

Transcription

1 Stefano Pigozzi President Monomers Division BASF Monomers Division Excellence in Commodities Investor Day Chemicals segment May 22, 2014 BASF Investor Day Chemicals segment Monomers, May 22,

2 Cautionary note regarding forward-looking statements This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. BASF has based these forward-looking statements on its views and assumptions with respect to future events and financial performance. Actual financial performance could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and BASF does not undertake any duty to update the forwardlooking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations. BASF Investor Day Chemicals segment Monomers, May 22,

3 Monomers represent almost 1/10 th of BASF Group s third-party sales BASF Group third party sales 2013 Performance Products 21% Chemicals 23% Agricultural Solutions 7% 74 billion Monomers 9% Functional Materials & Solutions 23% Other 6% Oil & Gas 20% BASF Investor Day Chemicals segment Monomers, May 22,

4 You experience our products every day! sleeping on your comfortable foam mattress opening your perfectly insulated fridge grabbing your packaged cheese enjoying the surface of your laminated tabletop BASF Investor Day Chemicals segment Monomers, May 22,

5 BASF Monomers Excellence in Commodities Excellent business with strong underlying growth opportunities Clear strategy based on cost and commercial excellence Growth targets focused on emerging markets and downstream segments Committed to generating above average returns and performance BASF Investor Day Chemicals segment Monomers, May 22,

6 BASF Monomers Excellence in Commodities Excellent business with strong underlying growth opportunities Clear strategy based on cost and commercial excellence Growth targets focused on emerging markets and downstream segments Committed to generating above average returns and performance BASF Investor Day Chemicals segment Monomers, May 22,

7 Most of the segments we serve will grow above GDP Automotive Textile Furniture Renewable Energy Electrical & Electronics Isocyanates Polyamides Polyamides Isocyanates Isocyanates Glues & Resins Inorganic Chemicals Electronic Materials * Market growth, CAGR Renewable energy: , World Energy Outlook 2013" report of the International Energy Agency (IEA), "New Policies Scenario" BASF Investor Day Chemicals segment Monomers, May 22,

8 A balanced portfolio between the different industry segments 3 rd party sales by industry (2013) in billion Other 19% Furniture 27% Electrical & Electronics 6% Construction 10% 6.4 billion Textile 14% Automotive 11% Chemicals 13% BASF Investor Day Chemicals segment Monomers, May 22,

9 Market leader position* in key product lines Isocyanates Polyamides & Intermediates Glues & Resins*** Inorganic Chemicals Electronic Materials 50% captive 71% captive 32% captive 50% captive 1% captive TDI (Toluenediisocyanate): #1 globally MDI (Methylenediphenyldiisocyanate): #1 globally Polyamides for packaging films: #1 globally Glues: #1 in Europe Sodium Methylate: #2 globally Hydrosulfite: #2 globally Hydrogenperoxide & Sulfuric acid: #1 in Asia & Europe NMP (N-Methylpyrrolidone): #1 globally Main Competitors Huntsman Dow Evonik Ube DSM Solvay KPX Chemicals Bayer Material Sciences Mitsui Chemicals Wanhua Borealis Grupa Azoty BASF Investor Day Chemicals segment Monomers, May 22, 2014 * (#): Market position in 2012 ** Percent of 3rd party sales 2013 *** Incl. Ammonia/Urea/Melamine 9

10 A globally balanced business with high OMP* shares in all regions 3 rd party sales by region (2013) in billion Rest of world 7% North America 21% 6.4 billion Europe 40% Asia Pacific 32% BASF Investor Day Chemicals segment Monomers, May 22, 2014 * OMP = Own Manufactured Products 10

11 Global asset footprint enables fast response in all markets Shanghai Yeosu Antwerp** Schwarzheide Geismar Ludwigshafen Freeport Caojing*. Taoyuan Production site worldwide Verbund site Guaratinguetá Anchieta Singapore BASF Investor Day Chemicals segment Monomers, May 22, 2014 * SLIC with Huntsman / SBPC with Shanghai Hua Yi and Sinopec ** Solvin with Solvay 11

12 Further expansion of Monomers footprint in all regions Shanghai Yeosu Antwerp Schwarzheide Geismar Freeport* Ludwigshafen Chongqing Caojing Taoyuan. Production site worldwide Verbund site Ongoing or planned investments Guaratinguetá Anchieta Singapore BASF Investor Day Chemicals segment Monomers, May 22, 2014 *Ammonia investment with Yara 12

13 BASF Monomers Excellence in Commodities Excellent business with strong underlying growth opportunities Clear strategy based on cost and commercial excellence Growth targets focused on emerging markets and downstream segments Committed to generating above average returns and performance BASF Investor Day Chemicals segment Monomers, May 22,

14 Cost excellence: Process improvements in MDI Increased real capacity by incremental process improvements 50 million EBIT Process improvement program MDI/Antwerp Target: Increase production output by continuous process improvement via incremental steps Expected benefits: Increased sales Production cost* reduction Annual EBIT improvement: ~ 50 million/a BASF Investor Day Chemicals segment Monomers, May 22, 2014 * Production cost = Personnel, maintenance and energy cost (inflation adjusted) 14

15 Cost excellence: Process improvements in MDI Strong increase of production output in the last decade Process improvement program MDI/Antwerp Target: Increase production output by continuous process improvement via incremental steps Achieved benefits: Increased sales Production cost* reduction Annual EBIT improvement : ~ 220 million/a BASF Investor Day Chemicals segment Monomers, May 22, 2014 * Production cost = Personnel, maintenance and energy cost (inflation adjusted) 15

16 Cost excellence: Process improvements in caprolactam Cyclohexane input reduction 7 million savings Yield improvement project caprolactam/freeport Target: Improvement of yields by higher product selectivity Expected benefit: Lower raw material input Annual savings: ~ 7 million/a BASF Investor Day Chemicals segment Monomers, May 22,

17 Cost excellence: Process improvement via advanced automation Effects of process automation Production rate Energy consumption Headcount Process automation program for continuous processes Target: Automation in order to increase speed of process adaptions to changing conditions Expected benefits: Higher production rate and lower energy consumption Headcount reduction Annual savings: ~ 45 million/a BASF Investor Day Chemicals segment Monomers, May 22,

18 Cost excellence: Backward-integration to strengthen our Verbund New ammonia plant Freeport/US Target: Take advantage of shale gas opportunities JV investment approach with Yara reduces capex, allows for world scale economics without increasing BASF s merchant market exposure Expected benefit: Backward integration into a key Verbund chemical used for caprolactam, amines, isocyanates etc. Benefit from low feedstock costs in the US BASF Investor Day Chemicals segment Monomers, May 22,

19 Commercial excellence: Complexity reduction due to extended value chains Organizational set-up until Dec 31, 2012 Ammonia Nitric acid Hydroxylamine HCl Chlorine Isocyanates TDI/MDI Caprolactam / Polyamides Sulfuric acid Extended value chains nitric acid/ludwigshafen Targets: Reduction of interfaces in production and marketing Achieved benefits: Improved planning performance led to Less storage capacities Additional volumes of nitric acid available for merchant market Inorganics Polyurethanes Performance Polymers Annual EBIT improvement in nitric acid: ~ 2 million/a BASF Investor Day Chemicals segment Monomers, May 22,

20 Commercial excellence: Complexity reduction due to extended value chains Organizational set-up from Jan 1, 2013 Ammonia Monomers Nitric acid Hydroxylamine HCl Chlorine Isocyanates TDI/MDI Caprolactam / Polyamides Sulfuric acid Extended value chains nitric acid/ludwigshafen Targets: Reduction of interfaces in production and marketing Achieved benefits: Improved planning performance led to Less storage capacities Additional volumes of nitric acid available for merchant market Annual EBIT improvement in nitric acid: ~ 2 million/a BASF Investor Day Chemicals segment Monomers, May 22,

21 Commercial excellence: Product portfolio optimization in polyamides Shift to high-margin products polyamides/ludwigshafen Target: Retrofit production lines to produce high-margin Ultramid C (Co-polyamide 6/6.6) used in film applications for food packaging Achieved benefit: Higher profitability of the Polyamide business Annual EBIT improvement: ~ 4 million/a BASF Investor Day Chemicals segment Monomers, May 22,

22 Commercial excellence: Product and application development in isocyanates New foam components based on MDI Target: Comfort improvement of conventional TDI-mattresses with a MDI-based viscoelastic gel foam layer Achieved benefit: : Annual sales growth of 17% p.a. Annual sales growth of 35 million/a from BASF Investor Day Chemicals segment Monomers, May 22,

23 BASF Monomers Excellence in Commodities Excellent business with strong underlying growth opportunities Clear strategy based on cost and commercial excellence Growth targets focused on emerging markets and downstream segments Committed to generating above average returns and performance BASF Investor Day Chemicals segment Monomers, May 22,

24 Growth: MDI investment in Chongqing, South-Western China MDI plant Chongqing World-scale plant; 400,000 mt/a located in Chongqing area, representing a market of 270 million people Nearly double-digit growth rates in China driven by construction and build-up of cold chain for food Startup delayed to Q as regulatory changes on natural gas prices affect integration concept of raw materials Local supply of fast growing market in South-western China BASF Investor Day Chemicals segment Monomers, May 22,

25 Growth: TDI investment in Ludwigshafen, Germany TDI plant Ludwigshafen Largest single-train TDI plant globally; 300,000 mt/a Superior cost structure due to economies of scale and highly efficient Verbund integration Growth story expected to continue in Eastern Europe and Africa In Europe rebalancing of market expected by further strengthening competitive environment New TDI-plant with best cost position in Europe BASF Investor Day Chemicals segment Monomers, May 22,

26 Growth: Polymerization plant in Caojing, China Polyamide plant Caojing BASF s first specialty polyamide plant in the Asia Pacific region; 100,000 mt/a Serving the strong growth markets for specialty products particularly in the engineering plastics and packaging film industries in China Further reduction of the merchant market exposure in caprolactam BASF Investor Day Chemicals segment Monomers, May 22,

27 Growth: Expanding downstream integration in Caprolactam Caprolactam outlet 2020 Verbund Ammonia Benzene Energy BASF caprolactam positioning Increasing share of captive use with start up of new 100 kt/a polymerization plant in Caojing Caprolactam Growth with higher value-added segments in downstream business 18% 82% Reduction of merchantmarket exposure Merchant Market Downstream Businesses Polyamide for engineering plastics Polyamide for packaging films BASF Investor Day Chemicals segment Monomers, May 22,

28 BASF Monomers Excellence in Commodities Excellent business with strong underlying growth opportunities Clear strategy based on cost and commercial excellence Growth targets focused on emerging markets and downstream segments Committed to generating above average returns and performance BASF Investor Day Chemicals segment Monomers, May 22,

29 A strong commodity business with good perspectives Sales to 3 rd parties in billion CAGR 4-5% Business perspectives Mid- and long term growth above GDP targeted for the steadily growing internal and external demand Excellence program results in additional earnings of ~ 200 million/a by 2020 EBITDA margin in line with BASF Group average E 2020E BASF Investor Day Chemicals segment Monomers, May 22,

30 BASF Monomers Excellence in Commodities Excellent business with strong underlying growth opportunities Clear strategy based on cost and commercial excellence Growth targets focused on emerging markets and downstream segments Committed to generating above average returns and performance BASF Investor Day Chemicals segment Monomers, May 22,

31 BASF Investor Day Chemicals segment Monomers, May 22,