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General
Corporate Presentation
1Q18
General
This presentation contains, or may be deemed to contain, “forward-
looking statements”. By their nature, forward looking statements involve
risks and uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future. The future results
of Alpek, S.A.B. de C.V. And its subsidiaries may differ from the results
expressed in, or implied by the forward-looking statements set out
herein, possibly to a material degree.
23.0
General
Index
• Business Overview
• Consolidated Financials
• Appendix
3
General
Index
• Business Overview
• Consolidated Financials
• Appendix
4
General
Investment Highlights
Market-leading position in the Americas1
High-return integration and cost-saving projects3
Attractive consumer-oriented product portfolio2
4 Low cost producer with leading technology
5 Experienced management team
6 Strong free cash flow and financial performance
5
General
Alpek is a leading petrochemical company focused
on Polyester chain products, mainly PTA and PET
Source: Alpek estimates
(1) LTM Mar 2018
(2) 6.65% of the subsidiaries Akra Polyester, S.A. de C.V. and 8.55% Tereftalatos Mexicanos, S.A. de C.V., are owned by BP Amoco Chemical Co.
(3) 49% is owned by Lyondell Basell Industries Holdings B.V.
(4) 50% minus one share is owned by BASF de Mexico S.A. de C.V. 6
Revenues1: US$ 5.5 Billion
EBITDA1: US$ 407 Million (US$ 520 Million ex- M&G A/R impairment)
Alpek Polyester2
PTA / PET Polyester Fibers
Polyester (72% of sales) Plastics & Chemicals (28% of Sales)
PolypropyleneExpandable
Polystyrene
Caprolactam
& FertilizersOthers
Indelpro3 Styropek Unimor Polioles4
General
Polyester Chain
Gasoline
Reformer Paraxylene
Crude Oil
Fibers
PET
PTA
MEGEthyleneCrackerEthane
Naphtha Ethylene Oxide
Polyester
Source: Alpek 7
1
1) 0.84 ton Ethylene per ton Ethylene Oxide2) 0.72 ton Ethylene Oxide per ton MEG3) 0.66 ton Paraxylene per ton PTA4) 0.85 ton PTA per ton PET5) 0.35 ton MEG per ton PET
2
3
4
5
4
General
Alpek´s products are widely used for food
packaging and consumer end-markets
Source: Alpek estimates
Kta: Thousand tons per year
Volume by Industry 2017(4,012 Kta)
Consumer
Goods
25%
Textiles
7%Construction
2%
Sales Geography 2017(US$ 5,231 Million )
Europe
3%
Mexico
35%
USA
44%
Asia and Others
1%LatAm
13%
Food and
Beverages
66%
Canada
3%
Sample End Users by Industry
Beverage Food Personal care Textiles
8
General
Alpek is the leading integrated polyester producer
in North America (PTA-PET)
1) Far Eastern (“FENC”) acquired Apple Grove assets from M&G on January 30th 2018
Source: PCI and Alpek estimates
PTA(5,550 kta)
M&G
FENC1
Indorama
NanYa
42%
PET(4,391 kta)
North America
2017 Installed Capacity
BP
Indorama
Eastman
41%
29%
13%
10%
30%
25%
5%
6%
9
General
Alpek’s installed capacity amounts to 7.0 M tons;
26 production facilities and ~5,900 employees
Source: Alpek estimates
Kta: Thousand tons per year
(1) Includes industrial and specialty chemicals and recycled PET capacities
Location of Production Sites Installed Capacity Breakdown (Kta)
Site PTA PET rPET Fibers PP EPS CPL Other
Mexico
(3,030 Kta)
A Monterrey 160
B Altamira 1,000 640 240
C Salamanca 85
D Ocotlán 10
E Cosoleacaque 610 185
F Lerma 100
USA
(2,358 Kta)
G Cedar Creek 170 73
H Cooper River 170 150
I Columbia 640 725
J Pearl River 430
Canada K Selenis 144
Argentina
(225 kta)
L Zárate 190
M Pacheco 16
N General Lagos 19
Brazil
(1,226 kta)
O Guaratingueta 46
S Ipojuca 640 450 90
Chile
(27 Kta)
P Santiago 5
Q Puerto Montt 2
R Concon 20
Total Capacity1: 7,010 Kta 2,890 2,464 89 400 640 325 85 117
AB
CD EF
GIHJ
LMN
O
P
Q
R
K
S
10
General
Alpek has developed a leading position in every
product of its portfolio
Source: PCI and Alpek estimates
(1) Staple fiber
(2) In the Americas, including recent EPS acquisition
Alpek: Industry Position
Industry Position Comments
PTA #1 in North America • 41% est. installed capacity share in North America
PET#1 in North America
#2 Worldwide• 42% est. installed capacity share in North America
Fibers #2 in North America1 • Leading supplier of filament for car seatbelts
• 31% est. installed capacity share (excl. filament)
PP Only producer in Mexico • Attractive growth potential
EPS #1 in the Americas• Largest plant in the Americas
• 46% est. installed capacity share2
CPL Only producer in Mexico • Among top 3 lowest cost producers worldwide
Po
lye
ste
rP
las
tic
s &
Ch
em
ica
ls
11
General
Alpek has invested in attractive organic projects to
enhance profitability
Strategic Guidelines
Project OverviewEstimated figures and dates
● Capture natural gas, ethane and propane
advantage in North America
● Maximize operating efficiency
● Selective capacity expansion
● Lever IntegRex® technology
ProjectCapex (US$M)
EBITDA (US$M)
Start-up
1. Cosoleacaque Cogeneration 140 30 4Q14
2. MEG Tolling Agreement 65 20 2Q16
3. Propylene Spheres (2) 23 10 2Q17
4. EPS Expansion Altamira 30 10 3Q17
5. Altamira Cogeneration 350 90 2018
6. PTA/PET Site (Corpus Christi)1 TBD TBD TBD
Total ~ $580 ~$160
US $537 M invested up to Mar-18
Source: PCI and Alpek estimates
(1) JV among Alpek, Indorama and FENC presented winning bid to acquire Corpus Christi project; transaction subject to approval by governmental authorities 12
General
Alpek also holds a successful M&A track record
and is constantly evaluating potential targets
Attractive Market Potential
Existing/Related Business
Cost Competitiveness
M&A Deals (2011-2018)M&A Guidelines
Product Capacity Year Country Investment
1. EastmanPTA /
PET1.3 Mtons 2011 USA US $622 M
2. Wellman PET 430 ktons 2011 USA US $123 M
3. Cabelma rPET 16 ktons 2014 Argentina Undisclosed
4. BASF EPS EPS 230 ktons 2015 The Americas Undisclosed
5. BASF (Concon) EPS 20 Ktons 2016 Chile Undisclosed
6. Selenis PET 144 ktons 2016 Canada Undisclosed
Alpek
M&A
7. Petroquimica
Suape
PTA 640 ktons
2018 Brazil US $435 MPET 450 Ktons
Fibers 90 ktons
13
General
Guidance 2018
4,1354,0123,9383,9373,931
20152014 20172016
+3%
2018G
Sales Volume Revenues
EBITDA CAPEX
Source: Alpek estimates
569
669630
434384
2015
+48%
2017 2018G2014 2016
167
345317320
236
-29%
2014 2018G2015 2016 2017
(Kto
ns
)
(US
$ M
illio
n)
(US
$ M
illio
n)
(US
$ M
illio
n)
5,4134,838
5,284
6,471
5,231
2014 2018G201720162015
+3%
% Sales 6.7% 7.3%11.9% 13.8% 10.5%
14
General
EBITDA: 2017 vs 2018 Guidance
22569
99
113384
2017 2018G
5
M&G A/R
Provision
Inv. Gain
(2017)
P&ChPolyester
Alpek: EBITDA(M dls)
US$M 2017 2018G
Polyester 246 346
Plastics & Chemicals 229 224
Comparable 475 569
Inventory gain 22 -
M&G A/R Provision (113) -
Reported 384 569
15
General
EBITDA: 1Q18 vs 1Q18 Guidance
1014
18
139
1Q18
181
Inv. Gain
& Others
1Q18G P&ChPolyester
+42
Alpek: EBITDA(M dls)
US$M 1Q18 1Q18G
Polyester 102 84
Plastics & Chemicals 69 55
Comparable 170 139
Inventory Gain & Others1 10 -
Reported 181 139
(1) Inventory gain +16 M dls, Legal fees -5 M dls16
General
Relevant events – Progress and status (1Q18)
● M&G’s Restructure Process ▪ JV (Alpek / Indorama / FENC) presented winning bid for Corpus Christi project; subject to governmental approval
▪ Normalized M&G Mexico operations in 1Q18 (supported by Alpek)
▪ M&G Brazil to be acquired by Indorama
● Sale of Cosoleacaque and Altamira power cogeneration plants▪ Ongoing process to finalize cogeneration power plants sale in Mexico
▪ Longer-than-expected implementation of regulatory changes in power tariffs weighed on timing
● Petroquímica Suape and Citepe (PQS) acquisition in Brazil▪ Completed April 30, 2018
▪ Purchase price: US$435 million
● PET antidumping cases in U.S.A. and Canada▪ USA: affirmative preliminary determinations; duties range from 8% to 227%
▪ Canada: negative C.I.T.T. ruling appealed in 2Q18
17
General
Index
• Business Overview
• Consolidated Financials
• Appendix
18
General
Sales Volume and Revenues
+1%
4,041
78%
22%
2017
4,012
77%
20181
23%
2016
3,938
24%
76%
3,937
77%
23%
2015
Sales Volume Revenues
28%
2017 20181
+5%
5,470
72%
2016
71% 71%
5,231
27% 29%29%
73%
4,838
2015
5,284
(Kta
)
(US
$ M
illi
on
)
Polyester Plastics & Chemicals
(1) March 2018 LTM
Source: Alpek estimates 19
General
Income Statement Accounts
532481
20172015 2016 20181
Operating Income (Loss) EBITDA
Financial Cost, Net (2) Majority Net Income (Loss)
Source: Alpek estimates
(1) March 2018 LTM
(2) Financial Cost, Net = Net Financial Expenses + Fx Gains (Losses) + Interest Rate Swaps + Gas & Comm. Derivatives
114
133116
93
9595
20181
209188
20162015 2017
198175
-167
20181201720162015
(US
$ M
illio
n)
(US
$ M
illio
n)
(US
$ M
illio
n)
(US
$ M
illio
n)
-3.6%11.0%9.1%% Sales
% Sales
6.1%4.1% -5.9%3.3%% Sales
669630
201812016 20172015
7.3%13.8%11.9%
-3.1%
7.4%
497
384
162
Ex-M&G360Ex-M&G
Ex-M&G
Ex-M&G
-188
-319
-168
380
407
520
157
Reported
Reported
Reported
Reported-324
20
General
Balance Sheet Accounts
595
497
694632
201720162015 20182
Net Working Capital(1) Property, Plant and Equipment
Net Debt(3) Stockholders’ Equity
Source: Alpek estimates
(1) Net Working Capital = Accounts receivable + Other accounts receivable + Inventories - Suppliers - Other accounts payable and accrued expenses
(2) March 2018
(3) Net Debt = Bank loans and notes payable + Current portion of long term debt + Long term debt – Cash
2,1082,1051,955
1,820
201720162015 20182
1,2701,262
1,042
722
2015 20172016 20182
1,7251,604
2,0192,005
20182201720162015
(US
$ M
illio
n)
(US
$ M
illio
n)
(US
$ M
illio
n)
(US
$ M
illio
n)
394445 53NWC Days
21
General
Financial Ratios and Other Indicators
Interest Coverage(1)Net Debt / EBITDA
CAPEX
Source: Alpek estimates
(1) Interest coverage= EBITDA / Net financial expenses
(2) LTM March 2018
4.8
7.0
10.7
4.8
6.2 6.1
201822015 20172016
2.4
1.6
1.1 2.5
20182
3.1
2017
3.3
20162015
216236
345317
2018220172015 2016
(Tim
es
)
(Tim
es
)
(US
$ M
illio
n)
170160
129
20172016 201822015
124
EBITDA / Ton
(US
$ / T
on
)
Ex-M&G
10196
Reported
Ex-M&G
Reported
Ex-M&G
Reported
22
General
Alpek Consolidated Debt Profile - March 31, 2018
● Net Debt: U.S. $1,270 million / Gross Debt: U.S. $1,709 million
● Available Committed Credit Lines: U.S. $899 million (Total: U.S. $1.140 billion)
● 99% of our debt is denominated in US dollars(1)
(1) A small portion of debt is denominated in ARS
300
715
135
202
12
331
440
20212019 202320202018 2022Cash
23
General
Dividends paid to shareholders
143
111
95
114
100
2017201620152014(1)2013 2018
(1) Paid in December2013
(US
$ M
illio
n)
24
General
Index
• Business Overview
• Consolidated Financials
• Appendix
25
General
Operating & Financial Highlights (1Q18)
Alpek
• 1Q18 Consolidated EBITDA of U.S. $181 million, including a U.S. $16 million
non-cash inventory gain and U.S. $5 million non-recurring legal fees/expenses
• Process to finalize cogeneration power plant sale in Mexico is ongoing
• Signed 3-year credit of up to U.S. $710 million with 18-month availability period
Polyester
• JV among Alpek, Indorama and Far Eastern to acquire Corpus Christi project
from M&G USA
• Normalized M&G Mexico operations in 1Q18
• Engaged in the confirmation of final conditions required to close
PetroquímicaSuape and Citepe acquisition
Plastics &
Chemicals
(P&C)
• 1Q18 P&C EBITDA of U.S. $69 million, including a U.S. $1 million non-cash
inventory gain
• P&C results benefited from a spike in polypropylene (PP) reference prices
amid tight supply caused mainly by U.S. propylene plant outages and startup
delays
26
General
Latest Quarter Results
Source: Alpek
(1) Times: Last 12 months.
Alpek: Selected Financial Information
(%) 1Q18 vs.
1Q18 4Q17 1Q17 4Q17 1Q17
Total Volume (ktons) 1,016 975 986 4 3
Polyester 787 752 759 5 4
Plastics & Chemicals 229 224 227 3 1
Consolidated Revenues 1,532 1,321 1,293 16 19
Polyester 1,109 933 916 19 21
Plastics & Chemicals 423 388 376 9 12
Consolidated EBITDA 181 141 158 29 15
Polyester 111 77 87 44 27
Plastics & Chemicals 69 64 70 9 (2)
Profit Attributable to Controlling Interest 82 (30) 87 372 (5)CAPEX and Acquisitions 56 30 76 87 (26)
Net Debt 1,270 1,262 1,175 1 8
Net Debt/LTM EBITDA(1) 3.1 3.3 1.8
Interest Coverage(1) 4.8 4.8 10.0
27
General
Latest Quarter Results
Sales Volume Revenues
EBITDA Majority Net Income
Source: Alpek
(Kto
ns
)
(US
$ M
illio
n)
(US
$ M
illio
n)
(US
$ M
illio
n)
970998981986 9751,0121,0381,016
4Q1Q 2Q 3Q
133
157
208
158141
3
82
181
4Q1Q 3Q2Q
1,1831,2361,2371,293 1,3211,3121,306
1,532
1Q 4Q3Q2Q
285048
87
-30
-400
25
82
3Q1Q 4Q2Q
1.4% 6.1%
-97.9% -902.8%
Ch.% Ch.%
Ch.% Ch.%
0.5% 11.7%
5.5% -209.4%
3.0% 18.5%
14.5% -5.4%
(US
$ M
illio
n)
5.8% 5.5%
-60.5% -48.5%
2017 2018 ex-M&G
3
116
201628
General
Latest Quarter Results
Source: Alpek
Alpek: Net Income
Alpek: Cash Flow
(%) 1Q18 vs.
1Q18 4Q17 1Q17 4Q17 1Q17
EBITDA 181 141 158 29 15
Net Working Capital & Others (85) (37) (64) (127) (31)
Capital Expenditures & Acq. (56) (30) (76) (87) 26
Financial Expenses (22) (22) (16) (1) (39)
Income tax (7) (9) (27) 20 72
Dividends - (7) (88) 100 100
Payment affiliated companies - - - - -
Other Sources / Uses (18) (105) (20) 83 12
Decrease (Increase) in Net Debt (7) (70) (134) 90 95
(%) 1Q18 vs.
1Q18 4Q17 1Q17 4Q17 1Q17
Consolidated Net Income 103 (20) 106 613 (3)
Non-Controlling Interest 21 10 19 103 9
Controlling Interest 82 (30) 87 372 (5)
Earnings per Share (U.S. Dollars) 0.04 (0.01) 0.04 372 (5)
Avg. Outstanding Shares (Millions)* 2,117 2,117 2,117
29
General
Comparable EBITDA and 2018 Guidance (ex-M&G)
Reported EBITDA 2015 2016 2017 2018G 1Q17 1Q18 1Q18G
Polyester 344 349 147 346 87 111 84
Plastics & Chemicals 284 322 237 224 70 69 55
TOTAL 630 669 384 569 158 181 139
Comparable EBITDA 2015 2016 2017 2018G 1Q17 1Q18 1Q18G
Polyester 378 331 234 346 69 102 84
Plastics & Chemicals 273 308 229 224 63 69 55
TOTAL 654 637 462 569 131 170 139
Adjustments* 2015 2016 2017 2018G 1Q17 1Q18 1Q18G
Polyester 35 (18) 87 - (19) (10) -
Plastics & Chemicals (11) (14) (8) - (8) (1) -
TOTAL 24 (32) 79 - (26) (10)1 -
*Adjustments: Inventory and non-operating, one-time (gains) losses
(1) Inventory gain +16 M dls, Legal fees -5 M dls30
General
EBITDA vs. Guidance (2017)
US$M 2017 2017G
Polyester 246 304
Plastics & Chemicals 229 198
Comparable 475 502
Inventory gain 22 -
M&G A/R Impairment (113) -
Reported 384 502
Alpek EBITDA vs Guidance
2232921
32 384389
113
502
Secondary
feedstocks
(IPA)
2017OthersM&G PP
US -$5 M
Inv. GainM&G A/R
Impairment2017G 2017
Ex-M&G
31
General
Alpek acquired Petroquímica Suape and Citepe in
Brazil
• Capacity (Ktons): 640 PTA, 450 PET, 90 Filament
• Location: Ipojuca, Pernambuco, Brazil
• Highlights: • Only integrated PTA-PET plant in South America• Only PTA producer in South America• 1 of 3 PET plants in South America• Brazil is largest polyester export mkt for Alpek
Montreal. Canada
Charleston. USA
Columbia. USA
Bay St. Louis. USA
Monterrey. México
Fayetteville. USA
Altamira. México
Cosoleacaque. México
Zárate. Argentina
Pacheco. Argentina
Polyester Plants (4,663 Kta)
Petroquímica Suape / Citepe Site
Alpek – Polyester plants Petroquímica Suape and Citepe
Ipojuca, Brazil
32
General
JV formed to acquire, complete and operate the
Corpus Christi project
● Newly formed JV between Alpek, Indorama and
Far Eastern (FENC)
● Winning bid for Corpus Christi assets
(Total value: U.S. $1.169 billion)
▪ Subject to regulatory approval
▪ Does not include cost to complete (amount TBD)
● JV will operate as toll manufacturer for Alpek,
Indorama and Far Eastern
● Each partner will:
▪ Independently procure its raw materials
▪ Pay at cost 1/3 of the PTA and PET produced
▪ Independently sell and distribute their PTA and PET
200
390
969
390
190
200
Cash Other non-cash
contributions
Total Value
1,169
Contributions as of 1Q18(US$ Millions)
Indorama
FENC
Alpek
Cash
Highlights - Corpus Christi Polymers LLC
(CC Polymers)
33
General
PTA1.3 M tons
PET1.1 M tons
Corpus Christi Plant (CC Polymers)
Raw materials
Raw materials • PET (Int.): 367 Kta• PTA: 125 Kta
• PET (Int.): 367 Kta• PTA: 125 Kta
Raw materials • PET (Int.): 367 Kta• PTA: 125 Kta
CC Polymers capacity share per partner
FAR EASTERN GROUP
34
General
Alpek has effectively transformed its EPS business
The Americas’ installed EPS capacity 2017Total: ̴ 600 ktons
Nova
14%
Others
21%
Nexkemia 7%
42%
Alpek
(Styropek)
15%
Flint Hills
75
20
65
325
230
165
Concon Plant
(Chile)
20152014 Acquisition from BASF
(MX/US/SA)
Altamira Expansion (Mexico)
2018
Kta
Alpek: EPS capacityExpandable Polystyrene (EPS)
35
General
Alpek acquired a controlling interest in Selenis
Canada Inc.
• Capacity: 144 Ktons (PET)
• Location: Montreal, Canada
• Highlights: • Only PET plant in Canada• Alpek to capture PTA integration synergies• Complement product portfolio with
differentiated PET products
Montreal. Canada
Charleston. USAColumbia. USA
Bay St. Louis. USA
Monterrey. México
Fayetteville. USA
Altamira. México
Cosoleacaque. México
Zárate. Argentina
Pacheco. Argentina
Polyester Plants (4,519 Kta)
Selenis Plant (144 Kta)
Alpek – Polyester plants Selenis Canada Inc.
36
General
U.S.A. PET antidumping case (2016)
Case Calendar
• March´15: Department of Commerce (DOC) and
International Trade Commission (ITC) filing
• March´16: DOC issued affirmative FINAL Antidumping
Duty and Countervailing Duty determinations
• April´16: ITC issued affirmative FINAL determinations
Countervailing Antidumping
Canada N/A 14 %
China 7 – 126 % 105 – 126 %
India 0 – 1541 % 8 – 19 %
Oman 0 % 8 %
(1) 154% only for JBF Industries Limited
Final Rates
• Rates applicable for a minimum period of five years.
• Trade orders could be renewed in five-year increments
37
General
U.S.A. PET antidumping case (2017)
Case Calendar
• September’17: Petitions filed
• 4Q17: Investigation initiated by Department of
Commerce (“DOC”) and International Trade
Commission (“ITC”)
• April´18: Affirmative preliminary determinations
• 3Q18E: Final determinations
Antidumping
Brazil 24 – 227 %
Indonesia 13 %
South Korea 9 – 101 %
Pakistan 8 %
Taiwan 9 – 12 %
Preliminary Rates
38
General
Canada PET antidumping case (2017)
Canada
● Canada Border Services Agency (“CBSA”) imposed preliminary duties in 4Q’17 (22%-77%)
● Canadian International Trade Tribunal (“CITT”) ruled no injury or threat of injury from imports
● CITT ruling appealed (2Q18)
Countries under investigation
• China
• India
• Oman
• Pakistan
39
General
Polyester Chain
PTA, PET, and Polyester Fibers
Employees: ~4,300
Products (Capacity):
• PTA (2,890 Kta)
• PET (2,464 Kta)
• rPET (89 Kta)
• Fibers (400 Kta)
Raw Materials:
• Paraxylene (Px)
• Monoethyleneglycol (MEG)
• Acetic Acid and Isopthalic Acid (IPA)
End Markets:
• Food and beverage
• Textile
• Consumer Goods
EBITDA 2018 LTM
US$ 3,917 Million
Revenues 2018 LTM
US$ 171 Million
General Information
Source: Alpek
Selenis, Quebec.
PET
Cedar Creek, NC
PET, R-PET
Cooper River, SC
PET & PSF
Columbia, SC
PTA & PET
Pearl River, MI
PETAltamira, Tamps.
PTA
Zárate, Arg.
PET
Pacheco, Arg.
PET
Monterrey, N.L.
Headquarters
Polyester Filament
Cosoleacaque, Ver.
PTA & PET Ipojuca, Brazil
PTA, PET and Fibers
40
General
Plastics & Chemicals
PP, EPS, CPL and Others
General Information
Employees: ~1,600
Products (Capacity):
• Polypropylene - PP (640 Kta)
• Expandable Polystyrene - EPS (325 Kta)
• Caprolactam - CPL (85 Kta)
• Other (117 Kta)
Raw Materials:
• Propylene, Styrene, Cyclohexane,
Ammonia, Sulphur, Pentane, Ethylene
Oxide, Propylene Oxide and Others
End Markets:
• Consumer Goods
• Food and Beverage
• Construction
EBITDA 2018 LTM
US$ 1,553 Million
Revenues 2018 LTM
US$ 236 Million
Ocotlán, Jal.
Nylon 6
Monterrey, N.L.
Headquarters,
Lerma, Edo. De Mex.
Specialty Chemicals
Altamira, Tamps.
PP, EPS
Salamanca, Gto.
CPL and Fertilizers
Guaratingueta, Brazil
EPS
Santiago, Chile
Other
Puerto Montt, Chile
Other
General Lagos, Argentina
EPS
Concon, Chile
EPS
Source: Alpek 41
General
Alpek is managed by an experienced team focused
on delivering value to shareholders
Source: Alpek
Po
lye
ste
rP
las
tic
s&
Ch
em
ica
ls
Name PositionYears with
Alpek / Alfa
José de Jesús Valdez Simancas CEO 42
Vacant CFO
Felipe Garza Medina Co-President, Alpek Polyester 41
Jorge Young Cerecedo Co-President, Alpek Polyester 28
Gustavo Talancón Gómez President, Polyester Filaments 29
Alejandro Llovera Zambrano President, Polypropylene 33
José Luis Zepeda Peña President, EPS and Chemicals 32
Gustavo Talancón Gómez President, CPL and Ammonium Sulfate 29
Po
lye
ste
rP
las
tic
s&
Ch
em
ica
ls
42
General
Plastics & Chemicals
Organization Chart
Source: Alpek
Polyester Chain
Felipe GarzaCo-President
Alpek Polyester
Jorge YoungCo-President
Alpek Polyester
Alejandro Llovera
President, Polypropylene
Gustavo TalancónPresident, Polyester Filaments
VacantCFO
José de Jesús ValdezCEO
José Luis Zepeda
President, EPS and Chemicals
Gustavo Talancón
President, CPL and Ammonium
Sulfate
43
General
Polypropylene Chain
Source: Alpek
Propylene
Refinery
Cracker
Polypropylene
44
1
1) 1.02 ton Propylene per ton PP
General
Gasoline
Reformer Benzene
Refinery
Crude Oil
EPS
EPS & CPL Chain
Source: Alpek
Ethylene
Styrene
Cyclohexane Caprolactam
(CPL)
Cracker
Ammonia
45
1) 0.29 ton Ethylene per ton Styrene2) 0.79 ton Benzene per ton Styrene3) 0.94 ton Benzene* per ton Cyclohexane4) 1.04 ton Cyclohexane per ton CPL5) 0.90 ton Ammonia pero ton CPL6) 1.00 ton Styrene per ton EPS
1
3
2
4
5
6
* dls/gal x 299.3 = dls/ton
General
+ +
World leader in PP production with sales
in more than 100 countries
Largest petrochemical company in the
world with more than 370 sites
Alpek has been a reliable partner to other global
industry leaders through successful joint ventures
51.0%50.0%
+ 1 Share
Source: Alpek
Alpek: Sample Joint Ventures
46
General
85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17
Fuente: Alpek
PTA/PET acquisitions
(USA)
CabelmaPET
Coso Cogen
Acquisition of
Univex
(Caprolactam)
Clear Path
Recycling
Cogeneration
project
Acquisition of PTA
plant
Polypropylene plant
start-up
Propylene
splitter
installation
Acquisition of
polyester business
(USA)
Acquisition of Argentina
and Mexico PET plants
EPS expansion in
Altamira
IPO (BMV)
DMT
Expansion EPS
Expansion
Polypropylene
expansion
EPS
acquisition
Selenis/ Concon
Acquisition
Sales Volume 1986-2017(Index: 1986=100)
Alpek has grown at a 7.4% annualized rate since
1986 through M&A, JVs and organic projects
47
General
Organic growth and acquisitions position Alpek as
a leading PTA and PET producer in North America
2004(5,500 Kta)
2017(5,550 Kta)
2004 (3,800 Kta)
2017(4,931 Kta)
PTA – Installed Capacity(1)
PET – Installed Capacity(1)
Eastman
Interquisa
BP
Invista
Indorama
Eastman
Wellman
Invista
M&G
NanYa
Others
M&G
Indorama
NanYa
FENC1
Source: PCI adjusted with Alpek’s official capacities
2017 Capacities, 2018 YTD M&As
29%
41%
8%
42%
Indorama
BP
Eastman
1) Far Eastern (“FENC”) acquired Apple Grove assets from M&G on January 30th 2018 48
General
North America PTA / PET capacity breakdown
Ktons USA Mexico Canada Total
Alpek 640 1,610 - 2,250
Indorama 1,050 - 600 1,650
BP 1,400 - - 1,400
Eastman 250 - - 250
Total 3,340 1,610 600 5,550
Ktons USA Mexico Canada Total
Alpek 1,495 185 144 1,824
Indorama 812 480 - 1,292
M&G 560 - 560
Nan Ya 445 - - 445
FENC1 270 - - 270
Total 3,022 1,225 144 4,391
PTA PET
1) Far Eastern (“FENC”) acquired Apple Grove assets from M&G on January 30th 2018
Source: PCI adjusted with Alpek’s official capacities
2017 Capacities, 2017 M&As
North America
2017 Installed Capacity
49
General
Proprietary Technologies
(I&D, acquisitions)
Third-Party
Technologies
Alpek operates a state-of-the-art portfolio of
proprietary and third-party technologies
PTA
• Integrex PTA
PET
• Integrex PET
• Melt – TekTM
Oilfield Chemicals
• In-house
technology
Polypropylene
• Spheripol (LB)
• Spherizone (LB)
EPS
• Single Step
(BASF)
Caprolactam
• HSO
• DSM
Alpek: Proprietary and Third-Party Technologies
Source: Alpek
50
General
Oxidation
Post-Oxidation
Filtration and
Drying
CTA Storage
Filtration and
Drying
Feed prep
Hydrogenation
Crystallization Crystallization
PTA Storage
Polymerization
Precursor
Storage
Esterification
Pre-Poly
Annealing
Solid State
Polymerization
Crystallization
PET Resin
Pelletization
Precursor
Preheating
Steps eliminated
with IntegRexTM
technology
Alpek’s IntegRex® technology simplifies both PTA
and PET production processes
Benefits from IntegRexTM technology:
• ~20% reduction in conversion cost
• ~US$15 less per ton in capital cost
• 11 less steps for the production of PTA and PET
• Lower wastewater by-product and greenhouse gas emissionsSource: Alpek
PTA / PET: Process Diagram
51
General
Power cogeneration overview
Contract-based
power
customers
Ga
s
turb
ine
Heat Recovery
Cogeneration plant
Ste
am
turb
ineNatural Gas
Electricity
Steam
Steam
12
3
1. Gas turbine generates electricity
2. Combustion gases produce steam
3. Steam is used to generate additional electricity and for Alpek’s chemical reactions
Hot
gases
52
General
M&G Chemicals Overview
● Founded 1953 in Toronta, Italy
● Private company; no public debt or equity
● 20-yr comercial relationship w/Alpek(11% of Alpek sales)
PTA PET
Apple Grove (USA) 270
Altamira (Mexico) 560
Suape (Brazil) 550
Corpus Christi1 (USA) 864 600
About M&G Plant locations
Installed Capacity
1) Under construction; net of Alpek’s capacity reservation
Source: PCI
Altamira
Suape
Apple Grove
Corpus Christi1
53
General
Alpek’s exposure to M&G
US$M Guarantee
Capacity Reservation Corpus Christi 435 Corpus Christi assets (2nd lien)
Accounts Receivable 113 Unsecured
$90 M Loan 90 Corporate guarantees
M&G Mexico Loan (Acquired) 100 M&G Mexico PET plant in Altamira (1st lien)
M&G Mexico Loan 301 US $60 M secured credit facility
1) Amount disbursed as of 1Q18 54
General
M&G’s Corpus Christi site capacity breakdown
(pre-bankruptcy agreement)
420 Ktons
PTA1.3 M tons
M&G850 Ktons
500 Ktons
M&G600 Ktons
Pearl River
PET1.1 M tons
350 Ktons PTA
Corpus Christi Site (CC)
Raw materials(e.g. Px, MEG, etc.)
Raw materials(e.g. Px, MEG, etc.)
55
General
Non-recurring charges associated to M&G (2017)
Income Statement Balance Sheet
US$M2017
(ex-M&G)
Non-rec.
charges2017
Operating Income 360 (548) (188)
Intangible asset impairment (435)
A/R Provision (113)
EBITDA 497 (113) 384
A/R Provision (113)
Financial cost, net (93) (95) (188)
Taxes (52) 158 106
Net income (loss) 214 (485) (271)
Profit (loss)attributable to
controlling interest162 (481) (319)
Net Debt 1,262 1,262
Net Debt / EBITDA 2.5 3.3
US$MDec-17
(ex-M&G)
Non-rec.
chargesDec-17
Assets 5,298 (546) 4,752
Trade accounts receivable 657 (113) 544
Intangible Assets – Cap Res 566 (360) 206
Other Assets – Cap Res 77 (75) 2
Other Assets – Loan 204 (95) 109
Other Assets – Deferred tax 26 97 123
Other Assets 3,769 - 3,769
Liabilities 3,208 (61) 3,147
Other Liabilities – Deferred tax 284 (61) 223
Other Liabilities 2,924 - 2,924
Stockholders’ Equity 2,089 (485) 1,604
Net Income 214 (485) (271)
Others 1,875 - 1,875
56
General
2018 average Brent price estimated at $57/bbl
Brent Crude Oil
• Δ 1 US$ dollar / Bbl = ~ Δ 3 US$ Million EBITDA
120
80
60
20
40
100
Dls/Bbl
99 $/bbl
53 $/bbl
2014 2015 2016 2017
44 $/bbl
Guidance 2018
($57/bbl)
2018
54 $/bbl
57
General
1,003981898
995926
871920
838882
948
1,168
9701,014
1,543
1,6351,708
1,069
4Q’171Q’152011 2012 20142013 3Q’172Q’173Q’164Q’152Q’15 1Q’16 1Q’172Q’16 4Q’163Q’15 1Q’18
Px USA Contract Price
(US
$ / To
n)
Paraxylene (Px) Price
58
General
Propylene and Styrene Prices
North America Propylene Contract Price North America Styrene Spot Price
47
53
59
50494847
40393939
46
52
48
42
3638
333131
33
42
50
3Q 4Q1Q J4Q3Q2Q1Q 2Q N DJMAM OAF SJ F MJ
2015 2016 2017 2018
6872
6057
5352
60
55
5048
46
50
63
74
59
49
4446
4239
48
59
44
JF1Q J2Q M4Q4Q3Q 3Q1Q 2Q JMA OSA NJ D F M
2015 2016 2017 2018
(c / lb
)
(c / lb
)
59
General
Margin: Asia PET to Px/MEG
(US
$ / To
n)
PET Margin (Asia)
2016 2017
PTA
PET
201
74 71 69 63 59 71 64 63 60 72 80 81104
289
237222
214200
284
12
258
1Q
394
11
342
2Q
270
3Q
210
1Q
260
1513 4Q
240
212
263
210230
3Q 4Q
276
1Q 2Q14
China
250
2018
232
Source: ICIS, PCI, CCFGroup, Alpek
60
General
Polypropylene Margin (USA)
Margin: Polypropylene to Propylene (PGP)
202020
181818
23
28
30
26
20
15
1111
111110
1Q 2Q 3Q 4Q 1Q20142013 1Q2012 3Q2Q 2Q 4Q3Q1Q4Q2011
(c / lb
)
2015 2016 2017 2018
61
General
1,0631,108
933
819
1,192
781
637647584
641704
985986
797
1,013
1,181
2,108
20142013 1Q2011 2Q2012 2Q1Q1Q3Q 3Q2Q 4Q4Q 1Q4Q3Q
Margin: CPL Spot (Asia) to Contract Benzene (NA)
(US
$ / To
n)
Caprolactam Margin
2015 2016 2017 2018
62
General
Alpek stock highlights (BMV: ALPEK)
Valuation 4Q15 4Q16 4Q17 4Q17 Proforma
1Q18 1Q18 Proforma
2018G
Market Cap. (U.S.$ B) 3,113 2,193 2,951 2,951 2,883 2,883 2,859
Net Debt (U.S.$ M) 722 1,042 1,262 1,262 1,270 1,270 1,167
EBITDA LTM (U.S.$ M) 630 669 384 497 407 520 569
Enterprise Value / EBITDA 6.5 5.2 11.6 9.0 10.9 8.5 7.5
Price / Earnings 13.3 8.0 N/A 13.8 N/A 13.6 10.9
Price per Share (MXN) 25.98 21.10 26.50 26.50 25.55 25.55 26.0
Exchange Rate (MXN/USD) 17.67 20.35 19.00 19.00 18.76 18.76 19.25
6
2
0
3
1
4
2
0
1
5
6
5
4
3
OSA NJM JDJAS MD FO JNAJ MF
Daily Average Traded Shares & Value
2016
Daily Stock Price
(Pe
so
s)
35
15
25
40
30
20
DecSepDecSep JunJun Mar Mar
2016
Shares
Value ($)
(M Shares) (U.S. $ M)
20172017 2018
63