The Investment Case of Borouge

[Music] warm welcome from my side and thanks for joining us to hear about Bru I'm going to take you now into the downstream sector petrochemicals what is barou doing we're producing high value polyphant meaning PE and PP polyethylene and polypropylene I'm going to show you what makes our product different and a little bit about the growth story that is ahead of us we try to summarize essentially our investment case on one slide so let me try to talk you through but first of all give you a little Glimpse on you know where we end with our production we end our production with the pellets everything else is then done by our customers providing the product to to the market that you all know pipes electricity cable Automotive Part smart packaging what makes barou different we're focusing with our business on the high growth markets a large portion of what we're selling of what we're marketing goes to the asia-pacific region naturally one of the region which grows most a region also where we have long-term fundamentals important for us also we have direct Market access brou is not selling our product through distributors in most of the cases we talk directly to the customer why is that important when we talk afterwards about the technology and what makes the product different you will understand that there is also a certain storyline that you need to to get across to the customer number two clearly first cost quoile positioning we had Peter talking about adnoc gas adnoc gas delivers essentially our feed stock to us two things which are important a long-term reliable contract for the feed stock and an attractive price if you look at the cost curve we are clearly first cost quartile that comes on one hand from the exis to advantaged feed stock ample feed stock but also from another angle we're operating here in Ru the largest integrated pet cam site on the globe if you Google it pretty amazing and we're about now to build brou 4 going to talk about that in a second so cost competitiveness at the edge with a large scale production economies of scale and a longterm access to Advantage feed stock what was the idea 1998 when brouge was created as a joint venture between boreales and adnoc the idea was to marry up the feed stock angle with a superior technology and this Superior technology is called B Star B essentially allows us to produce better polyol fense better PE better PP what can that be longevity easier recyclability physical properties and it goes up to spaces where we say nobody else can play in terms of the quality and the purity of the product equally important is strong brand we have over time delivered a very very strong brand name and access to the market This Promise for Quality where our customers can rely on that leads ultimately to the next angle differentiated products and why is it important to have those differentiated products it's important because we can command a premium over the market our products can yield a higher price now you will say why why is somebody wanting to pay a premium for the same material it's not the same material there's a lot of innovation going into it we have a great Innovation Center here in Abu Dhabi which is part forming part of an international Innovation Center Network we're always on the Forefront together with our partners together with our shareholders to develop no new products which push the boundaries to the edge electricity cable high voltage cables long long longer living materials for the pipe sector what does it mean we're saying our long-term guidance is we should be able to Across the cycle yield $200 more premium per ton in polyethylene and roughly $140 on polyprop this allows us to have a very very robust cash generation we have a reliable dividend which is in a cyclical environment like Petro heml because not the norm rou stands out as the PowerHouse here we have given 1.3 billion of dividend commitment for 2024 which is a 6 and a half% dividend yield and the colleagues have been talking about growth the good thing is growth is already in in the backyard not even in the backyard it's in the center of race if you look at what we're currently constructing with barou 4 that's the fourth expansion of our product line here 1.4 million tons of additional capacity coming on stream 28% of capacity increase and in addition to that we're also looking into International expansion across the boundaries so if you look at what we have been delivering in terms of the IPO promises we are clearly the global leader in premium polyphen Solutions and I all encourage you go to our website download the presentation look at the great products you will recognize some of them there is a lot of movement in there it's a growing market and one thing that is for sure if if we want to address the meta challenges we have around energy energy transition around access to safe and clean water reducing emissions with lighter lightweight cars intelligent and recyclable packaging we are in the center of that we have depicted here and I talked to to you about you know the premium that were able to get across the cycle $244 per ton in polyethylene and 162 which we have been uh able to reap in the in the in the last period we're de developing as you said uh as you have been seeing here the world's largest single side polyan complex and our utilization rates of the assets are great if you look at how the assets are running they run like Swiss clocks 106% util Iz ation rate in polyethylene and 109% in polypropylene our ebda margin is clearly above all the pairs if you look at the sector 40% plus ebda margin stands out we're also well positioned for that growth and let me also add one thing Bru is one of the sole companies with the barou 1 barou 2 and the barou 3 project who has been able to consistently deliver large scale projects on time and on budget 1.3 times net debt to ebta and the cash conversion rate of 95% provides us a very stable basis for growth and as I said the growth particularly with Bru 4 and the de bottlenecker net we're doing is already in the backyard let's come to the last point but not the least exciting point and around the dividend payout as I said we're operating in a cyclical industry but we are the best in that industry we can deliver stable profits we have paid out already 2.9 billion in dividends since the IPO our dividend yeld is 6 and a half% which is certainly combined with our preprogrammed growth a very good a very good approach to look into invest in barou so I invite you if you have any additional questions the team is here I'm around happy to talk to you about otherwise all the material is available on the internet uh exciting case and we're looking forward to a very good journey going forward with the further growth that we have on the radar thank you so much thank you [Music]