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Engro Corporation www.engro.com Important Disclaimer THIS - - PowerPoint PPT Presentation

Engro Corporation www.engro.com Important Disclaimer THIS PRESENTATION IS NOT AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL ANY SECURITIES OR ANY INVESTMENT This presentation has been prepared by Engro Corporation Limited (Engro)


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www.engro.com

Engro Corporation

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This presentation has been prepared by Engro Corporation Limited (“Engro”) solely for information purposes. No representation or warranty express or implied is made thereto, and no reliance should be placed on, the fairness, accuracy, sufficiency, completeness or correctness of the information or any opinion contained herein, or any

  • pinion rendered thereto. The information contained in this presentation should be considered in the context of the circumstances prevailing at the time and will not be

updated to reflect any developments that may occur after the date of the presentation. Neither Engro nor any of its respective subsidiaries, affiliates, officials, advisors, associates, employees or any person working for, under or on behalf, shall have any responsibility and/or liability of any nature whatsoever (in contract or otherwise) for any loss whatsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. This presentation does not constitute or form part of a prospectus, offering circular or offering memorandum or an offer, solicitation, invitation or recommendation to purchase or subscribe for any securities and no part of it shall form the basis of, or be relied upon in connection with, or act as any inducement to enter into any arrangement, agreement, contract, commitment or investment decision in relation to any securities. This presentation shall not at all be intended to provide any disclosure upon which an investment decision could be made. No money, securities or other consideration is being solicited, and, if sent in response to this presentation or the information contained herein, will not be accepted. The presentation may contain statements that reflect Engro’s own beliefs and expectations about the future. These forward-looking statements are based on a number of assumptions about the future, which are beyond Engro’s control. Such forward-looking statements represent, in each case, only one of many possible scenarios and should not be viewed as the most likely or standard scenario. Such forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. Engro does not undertake any obligation to update any forward-looking statements to reflect events that occur or circumstances that arise after the date of this presentation and it does not make any representation, warranty (whether express

  • r implied) or prediction that the results anticipated by such forward-looking statements will be achieved. In addition, past performance should not be taken as an

indication or guarantee of future results. Certain data in this presentation was obtained from various external data sources that Engro believes to its knowledge, information and belief to be reliable, but Engro has not verified such data with independent sources and there can be no assurance, representation or warranty as to the accuracy, sufficiency, correctness or completeness of the included data. Accordingly, Engro makes no assurance, representation or warranty as to the accuracy, sufficiency, correctness or completeness of that data, and such data involves risks and uncertainties and is subject to change based on various factors. You agree to keep the contents of this presentation strictly confidential. All or any part of this presentation may not be taken away, reproduced, copied, redistributed, retransmitted or disclosed in any manner or form and for any purpose whatsoever. By attending this presentation, you are agreeing to be bound by the foregoing limitations.

Important Disclaimer

THIS PRESENTATION IS NOT AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL ANY SECURITIES OR ANY INVESTMENT

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Engro In A Snapshot

Engro is Pakistan’s premium conglomerate and voted 27 times among the top 25 organizations in Pakistan Operating in Fertilizers, Power Generation, Telecom Infrastructure, Petrochemicals, Mining, Dairy, LNG and Chemical Storage

Financial Highlights Scale People & Impact Import Substitution $2Bn 10-year CAGR 11% Credit Rating AA+ Total Employees 3.3K 2019 Revenue $1.5Bn Tax Contribution $285Mn Market Capitalization $1.3Bn Farmer Impact $12Mn

Market Capitalization as at December 31st, 2019 Note: Figures converted at PKR/USD 2019 Average

2019 Dividend $92Mn Total Assets $3.7Bn Vocational Trainings 870+ Community Investments $3Mn

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Our Footprint In Pakistan

USD 285 million contribution to national exchequer 3,300 employees 18,000 indirect employees Rice Mill Dairy Processing Plant Qadirpur Gas-fired Power Plant Fertilizer Complex Dairy Farm Dairy Processing Plant Karachi Head Office Thar Block II Coal Mining Chemical storage/ PVC manufacturing/ Terminal

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Our Journey Through Time

Engro has grown exponentially over the past 5 decades by adding new verticals and enhancing existing ones

1957 1965 1991 1995 1997 2005 2006 2007-09 2010 2014 2016 2017 2018 2019

Advent Esso Mobil JV Fertilizer Esso Pakistan Fertilizer created

ESSO Pakistan Fertilizer Company

Divestiture Exxon divests. Company renamed Engro Chemical Pakistan Limited Chemicals JV with Royal Vopak to enter into the chemical business PVC Becomes sole manufacturer of PVC in Pakistan through a JV with Mitsubishi Energy Enters energy business and begins work on a 220 MW power plant Food Enters food business Expansion Commences expansion; largest industrial investment of $1.1Bn Demerger Demerger into a conglomerate with ECorp as the Hold Co Thar & LNG

  • Work on Thar begins
  • LNG Terminal

Food Partners with RFC for EFoods Transformation Projects Initiated

  • One SAP
  • Human Capital

Transformation Engro & Vopak Engro Corporation and Royal Vopak sign LNG infrastructure agreement Thar & Enfrashare

  • Thar

achieves COD

  • Engro

enters Telecom Infra- structure sector

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Current Business Portfolio

Fertilizers

Top 50 fertilizer manufacturer in the world; 5 decades of operations as a world class business

Dairy

12 million consumer base; market leader in Pakistan’s UHT segment and number 2 dairy dessert brand

Energy & Mining

Operating Pakistan’s first 217 MW power plant on permeate gas; Operating first ever 2x330 MW mine-mouth coal power plant; Managing Pakistan’s first open-pit coal mine

Petrochemicals

The only fully integrated chlor-vinyl chemical complex in Pakistan producing PVC and other chlorine byproducts

Chemical Storage & Handling

Pakistan’s first LNG receiving terminal, and an integrated bulk liquid chemicals and LPG terminal

Telecom Infrastructure

Operating an independent tower company with a view to engage all the Mobile Network Operators to cater to their network deployment needs

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Corporate Structure

Engro Corporation

Engro Fertilizers (56%) Elengy Terminal (56%) Engro Polymer (56%) Engro Foods (40%) Engro Vopak (50%) Engro Eximp Agriproducts (100%) Engro Energy (100%) Engro Powergen Thar (51%) Sindh Engro Coal Mining (12%) Engro Powergen Qadirpur (69%)

Listed Entities Unlisted Entities

Engro Infiniti (100%) Enfrashare (100%)

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Engro’s Partners

Long-standing collaborations with global companies Strong relationships with multilaterals Consistently able to develop world-class bankable projects

Equity Partners Lending Partners Development Partners

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1,502 1,141

FY 2019 FY 2018

Engro Corporation Consolidated - Business Revenue

Segment-wise Revenue (USD Millions) Business FY 2019 FY 2018 Growth Fertilizers 807 726 11% ▲ Energy 333 79 4x ▲ Polymer and Chemicals 252 235 7% ▲ Terminals 111 106 5% ▲ Foods / Rice 283 233 22% ▲ Revenue grew by 32%:

▪ Higher realized Urea prices and improved product availability ▪ Contribution from new energy projects in Thar delivered in 2019 ▪ Higher domestic PVC premiums despite challenging

macroeconomic conditions 32% ▲

Revenue (USD Millions)

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201 157

FY 2019 FY 2018

Engro Corporation Consolidated - Business Profits

Standalone Profit After Tax increased by 12%:

Higher dividend and interest income Consolidated Profit After Tax increased by 28%:

Thar Energy projects contribution to PAT post COD on July 10th

Record production in EFert due to plant efficiency and gas availability

Lower profitability in Polymer due to inflationary impacts and a one-time gain recorded in 2018

Recognition of an impairment provision relating to the investment in FCEPL in accordance with IAS 36

Segment-wise Profit (USD Millions) Business FY 2019 FY 2018 Growth Standalone 95 85 12% ▲ Fertilizers 112 116 3% ▼ Energy 59 11 6x ▲ Polymer and Chemicals 24 33 26% ▼ Terminals 34 26 32% ▲ Foods / Rice (6) 3 3x ▼ FCEPL Impairment (8)

  • Consolidated

201 157 28% ▲

Profit After Tax (USD Millions)

28% ▲

Energy loan component USD 22 Mn Energy loan component USD 9 Mn

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Engro Corporation Consolidated – Debt Profile

Credit Rating - PACRA Company Long-term Rating Short-term Rating Engro Corporation AA+ A1+ Engro Fertilizers AA A1+ Engro Polymer and Chemicals AA- A1+ Engro Powergen Thar A A1 Engro Elengy Terminal AA- A1

Long-term Borrowings (USD Millions)

▪ Consolidated long-term borrowings increased primarily due to drawdowns for Thar coal power project and EPolymer expansion projects V/S

Healthy balance sheet allowing the Company to increase leverage for future growth opportunities!

41:59

Gearing Ratio FY 2018

45:55

Gearing Ratio FY 2019

Credit Rating improved in 2019 1,054 874

FY 2019 FY 2018

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Energy

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Thar Coal Mining & Power Project Update

Development of the 3.8 million tons per annum mine under Sindh Engro Coal Mining Company (SECMC) in the first phase Development of 2 x 330 MW mine mouth power plants under Engro Powergen Thar Limited Commenced construction of Phase II of the mine expansion which will enhance production to 7.6 million tons per annum Key Highlights: ▪ Both SECMC and Engro Powergen Thar Limited, declared Commercial Operations Date (COD) on 10th July 2019 ▪ Both mine and power plant have been running smoothly since COD ▪ In 2019, over 2.28 million tons of coal have been supplied by the mine to the power plant ▪ Potential to become cheapest source of electricity in the country at full base load ▪ The company is actively working with all stakeholders to address the circular debt challenge With this accomplishment, Engro is using indigenous resources to help alleviate the energy crisis that Pakistan faces and has,

  • nce again, proven its ability to deliver on mega projects that

enable development for the people of this nation

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Strategic Direction

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The Pressing Issues of Our Time

Global challenges have the potential to translate into an existential threat for Pakistan Impact of climate change coupled with inefficient practices can have a catastrophic impact Ever rising population and a growing middle class will result in a strain on resources The imbalance between domestic output and consumption will continue to put pressure on Balance of Payments Solutions will have to be innovative and beneficial for all socio-economic classes 1 2 3 4 5 6 Availability of Affordable Energy Water Scarcity Food Security Underdeveloped Storage & Logistics Balance of Payments Crisis Growing Digital Divide

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Engro’s Portfolio

Engro’s current portfolio has value chains across four key verticals enabled with leading-edge technology

Chemical Storage & Terminals

Energy & Infrastructure

Mining Power Generation Energy Water Scarcity

Petrochemicals

PVC Manufacturing Balance of Payments

Connectivity

Connectivity Telecom Towers Dairy

Food & Agriculture

Rice Processing Fertilizer Water Scarcity Food Security Agri Storage & Logistics

Various pilot projects and feasibility studies are underway across the four verticals

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Awards

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Awards and Recognition

Pakistan's Most Outstanding Company in the Industrial Sector Coal Power Project

  • f the Year

Pakistan’s Deal

  • f the Year

Best Investor Relations (Runner-up) Top 25 Companies Of the Year 2018 Safety, Environmental Compliance, Energy Efficiency breeding ground for next generation of safety leaders PAVE Project

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/Engro.Corporation /EngroCorp www.engro.com