Outlook for nafta pricing

410 views

Published on

Published in: Technology, Business
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
410
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
2
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Outlook for nafta pricing

  1. 1. Foro LatibexMadrid, November 2008
  2. 2. Forward-looking Statements This presentation contains forward-looking statements. These statements do not represent historical fact, but rather reflect the beliefs and expectations of Braskem’s management. The words “anticipate”, “wish”, “expect”, “estimate”, “intend”, “forecast”, “plan”, “predict”, “project”, “target” and similar words are intended to identify these statements. Although Braskem believes that the expectations and assumptions reflected in these forward- looking statements are reasonable and based on information currently available to management, Braskem cannot guarantee future results or events. The forward-looking statements included in this presentation are valid only on the date on which they are made (September 30, 2008), and the Company does not undertake any obligation to update them in light of new information or future developments. Braskem is not responsible for any transaction or investment decision taken based on the information in this presentation. 2
  3. 3. Braskem – Leader in Latin America Braskem’s resin capacity in Latin America, kton Braskem’s 3Q08 LTM Financials 3,440 Brazilian Gross Revenue Net Revenue assets 1,515 US$ 14 bi US$ 11 bi 692 682 521 438 Net Debt/EBITDA EBITDA Braskem Quattor* Dow Mexichem Solvay Ecopetrol Braskem’s resin capacity in The Americas, kton 3.42X US$ 1.4 bi 5,774 PVC 64 PP 615 PE 4,646 3,440 2,949 Enterprise Value Assets 1,833 515 1,110 1,210 2,161 5,095 2,813 2,040 1,815 761 1,235 US$ 7.2 bi US$ 12 bi 978 926 Dow Lyondell Braskem Formosa Ineos Shintech Basell 3rd 3*JV between Unipar (60%) and Petrobras (40%) 3 Source: CMAI
  4. 4. Leadership in a fast-growing domestic market 100% Market share in PVC 14% 20% 17% 19% Brazilian domestic resin demand, Kton/y 80% 20% 31% 29% 28% 30% 27% 32% 8%-10% 60% 17% 6.0% in 2008 40% CAGR 52% 57% 53% 54% 52% 10% 4,048 48% 20% 9% 3,694 0% 3,435 3,377 856 2001 2003 2005 2006 2007 9M08 Market share in PP 2,880 749 100% 10% 9% 7% 9% 14% 15% 692 80% 1,228 33% 48% 51% 55% 50% 37% 1,114 60% 990 40% 49% 52% 1,964 20% 42% 40% 38% 41% 1,833 1,695 0% 2001 2003 2005 2006 2007 9M08 100% Market share in PE 15% 16% 19% 17% 16% 21% 80% 2001 2004 2005 2006 2007 32% 28% 60% 53% 55% 46% 50% PVC PP PE 40% 20% 52% 51% 33% 29% 31% 37% 01-08 GDP Elasticity in Brazil: 2x 01- 0% 2001 2003 2005 2006 2007 9M08Source: Abiquim 4 BRASKEM PEER IMPORTS
  5. 5. Track record of strong and consistentorganic growth and acquisitions Rank amongst the 10 Become the largest largest petrochemical thermoplastic resins companies in the world producer in Latin measured by EV* America IPQ / CPS Paulinia Politeno 2012 Polialden 2007 2008 2006 Trikem 2002 1,626 Ebitda US$ milllion 1,422 871 851 758 581 457 +23% CAGR 2002 2003 2004 2005 2006 2007 3Q08LTM * Enterprise Value 5
  6. 6. Ownership Structure % Voting Capital % Total Capital CONTROLLING GROUP 60.3% 38.0% FREE FLOAT 36.5% 59.3% OTHERS (2) ODEBRECHT NORQUISA (1) PETROQUISA BNDESPAR 45.3% 32.0% 15.1% 6.0% 30.0% 23.0% 0.0% 5.1% 6.5% 31.2% Leveraging relationship with Petrobras: • Corporate governance standards: Shareholders’ agreement • Potential for operational synergies with refineries and partnership with Petrobras R&D Center • Alliance to strengthen Brazil’s petrochemical value chain – Consolidation around 2 large competitors (Braskem & Quattor) – Access to competitive raw materials – Improved value chain competitivenessNotes: 1 - Odebrecht has 100% of Norquisa 2 - Does not include shares held in treasury (3% of total) 6
  7. 7. Enhanced competitivenessthrough value chain integration Industrial integration Oil/Gas-refineries Basic petchem Resins Converters Competitive Innovation & raw material technology Operational Service and log synergies barriers Growing economic relevance of the Brazilian ConvertersAnnual revenue of converters, US$ Billion Diversified segments, %consumption Packaging % GDP Others 15% 15% 17.2 18.7 15.3 Automotive Cosmetics/ Pharma 1% 13.2 2% Electrical appliances 2% 9.3 Shoes 5% 16% Construction 8.1 6.7 Health and cleaning 7% 1.7% 9% 1.2% 1.6% 2.0% 1.7% 1.6% 1.5% Home 17% appliances 11% 2001 2002 2003 2004 2005 2006 2007 Agriculture Food 7
  8. 8. Challenging petrochemical cycle Potential negative factors Global ethylene supply-demand and operating rate, Mton/y, % • US/EU slow down • Incentives to sustain supply buildup – China: import substitution 153 157 149 •Middle East own agenda 139 142131 129 135 123 117 90% 88% 90% 87% 88% 88% 84% Supply vs. Demand 84% 83% Improved conditions compared to downturns in 1991 and 2000 • Frequent delays in new capacities 2008 1 2009 2 2010 3 2011 4 2012 • Supply-demand geographical 1 2 3 4 5 Supply Demand imbalance leads to logistics barriers • Increased economic importance of Operating rate – Set 08 Operating rate – Oct 07 emerging economiesSource: CMAI June 2008 8
  9. 9. Braskem is prepared to seize the opportunities offered by this environment o n eati C lu e cr with va Expand access to w attractive markets Gr o BStrengthen current position Assure regional low-cost raw A material and energy supplies Improve and • Green-PE and renewables protect core Latin • Potential M&As and American business Alliances• Leveraging relationship with Petrobras • Gas crackers in Latin America• Value-chain virtual integration • Brazilian sugar cane ethanol – Refineries, raw materials – Service and logistics – Innovation and technology• Operational, commercial excellence• Adding value to the crackers’ by-products 9
  10. 10. Green Polyethylene: a pioneerachievement Start up in 2011 Investment: ~ US$ 250 MM Capacity: 200 Kton/year Estimated Demand: ~ 500 kton/year Location: Triunfo Ethanol Consumption: 460 MM litters/year Target-markets: USA, Europe and Japan 100% Renewable Certified by Beta Sectors: Automotive and raw material Analytics USA consumption goods Sugar cane ethanol Main laboratory in the world specialized in carbon analysis 10
  11. 11. Braskem: established platform leveragesfuture growth Regional leadership Track record of sustainable growth with value creation Tangible innovation: Green polymer and product oriented R&D Sound capital structure ´ Strategic shareholders´ base: Odebrecht + Petrobras + 38% Floating Internationalization: growth towards competitive feedstock and attractive markets People and Sustainability at the center of the strategy 100% tag along for all shareholders 11 High corporate governance standards 11
  12. 12. Foro LatibexMadrid, November 2008

×