上海巴斯夫聚氨酯有限公司 中外合资 Shanghai BASF Polyurethane Co. Ltd. is a Joint Venture of 中国石化集团资产经营 管理有限公司 上海华谊(集团)公司 巴斯夫集团 SINOPEC Assets Shanghai Hua Yi BASF Management (Group) Company Group Corporation
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
上海巴斯夫聚氨酯有限公司 中外合资 Shanghai BASF Polyurethane Co. Ltd. is a Joint Venture of 中国石化集团资产经营 管理有限公司 上海华谊(集团)公司 巴斯夫集团 SINOPEC Assets Shanghai Hua Yi BASF Management (Group) Company Group Corporation Marko Murtonen
General Manager, Shanghai BASF Polyurethane Co. Ltd. September 27, 2013
Growing a successful isocyanates joint venture
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
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 forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations.
Cautionary note regarding forward-looking statements
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SBPC site presentation Ι September 27, 2013 Ι
1 | Building a world-scale isocyanates site
3 | Market approach
4 | Further growth plans
2 | Business performance
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Shanghai Center
50km
Hongqiao Dom. Airport
Pudong Intl. Airport
Shanghai
International Deep-Water
Port
Expressway Main Road Railway Yangtse River
Hangzhou Bay
SCIP
Geographical Location of SCIP
Shanghai Caojing
Source: SCIP presentation
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Shanghai Center
50km
Hongqiao Dom. Airport
Pudong Intl. Airport
Shanghai
International Deep-Water
Port
Expressway Main Road Railway Yangtse River
Hangzhou Bay
SCIP
Integrated chemical park
Value chains at SCIP include base chemicals, intermediates and downstream products
More than 50 companies invested ~USD15 billion
Located close to markets in Shanghai and the Jiangsu province and the Zhejiang province (combined GDP: ~USD1.7 trillion)
Good logistics with access to highways, railroads and Shanghai Deep-Water Port
Support of local government
Shanghai Chemical Industry Park (SCIP)
Geographical Location of SCIP
Source: SCIP presentation
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Bayer
PIC / PC Project
MDI/TDI/HDI Project
Integrated Project
Incinerator
Evonik Multi-user Site China
Mitsubishi Gas
Chemical PC
Internal Cases
Lucite MMA Project
Secco Ethylene Project Tankfarm
Shanghai Chlor-Alkali Chemicals
Co., Ltd
STYG PVC
GPCC
Mitsui GPCC BPA You Yue
Storage
BaiLian Tankfarm
Co- gen
Refinery and Cracker Project Dow Chemical
Integrated Project Invista
Nylon-6,6 HuaYi Polymer
Projects Lam- berti
Waste Water
Treatment
Bonded Warehouse
Fine Chemical Park
Budenheim APP
Natural Gas Gate
3M Adhesives
Industrial water works
R&D Center
R&D Center
Refinery and Cracker Project
CEPSA Chemical
BASF is a large investor in SCIP
SLIC/SBPC MDI/TDI
New projects
THF PTHF
Basonat Huntsman
Hangzhou Bay
Source: SCIP presentation
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
BASF with sizable operations in SCIP
G7
BASF stake:
70%
14%
16%
Huntsman
Ultramid® Coating resins
Basecoat Infra-structure
New investments
BASF stake: 100%
* Shanghai Lianheng Isocyanate Co.
** Shanghai BASF Polyurethanes Co. THF, PolyTHF
Basonat Land option
BASF stake: 35%
35%
15%
8% 7%
BASF Chemicals Company (BACH)
MDI TDI
SBPC**
Huntsman
Shanghai Hua Yi
Shanghai Chlor-Alkali Chemical
Sinopec Assets Management
crude MDI
SLIC*
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Nitric Acid
Integrated isocyanates production set-up
BASF system houses Huntsman
MDI Distillation
DNT
MDI Distillation 120kt/a
TDI 160kt/a
Merchant market
Crude MDI
SBPC (total investment ~€500 million)
SLIC
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Synergies with local Sinopec subsidiaries
Supply of naphtha, toluene and other upstream chemicals to SCIP and SBPC
Support in permissions and government relations
Synergies with local Shanghai Hua Yi subsidiaries
Supply of chlorine
Take-off of hydrochloric acid from SBPC
SBPC benefits from sharing of responsibilities among partners
BASF technologies
BASF management processes
BASF sales force and market access
Expertise in operational excellence
BASF Greater China functions (e.g. EHS, HR, legal)
Shanghai BASF Polyurethanes
Co. Ltd.
上 海 巴 斯 夫 聚 氨
酯 有 限 公 司
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Production, quality
management
Finance, IT, procurement
Sales & marketing,
supply chain management
Maintenance, engineering
& EHS
Human resources,
administration
SBPC Joint Venture management structure
SBPC joint venture management structure
General Manager (GM)
SBPC Board
Deputy General Manager (DGM)
Technology Agreed common goals:
– Profitable growth of SBPC – #1 position in TDI – Leading position in MDI – Earn premium on cost of
capital Board appointed by investors
according to equity share
GM and DGMs are delegates from partner companies
Annual targets approved by SBPC Board
Clear roles and responsibilities
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SBPC site presentation Ι September 27, 2013 Ι
1 | Building a world-scale isocyanates site
3 | Market approach
4 | Further growth plans
2 | Business performance
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Sales (in million €)
407
495 465
644 609
782
0
100
200
300
400
500
600
700
800
900
2007 2008 2009 2010 2011 2012
100%
106% 80%
118% 81%
EBITDA (indexed)
0%
50%
100%
150%
200%
250%
113%
Strong EBITDA yields high return on assets (>20 percent)
SBPC started operation in 2006
Business grows by ~10% in 2013
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
€10 - 15 million sustainable savings from 2015 onwards
Striving for operational excellence
Operational Excellence
People SBPC is BASF’s pilot for operational excellence in BASF Greater China with focus on: People
– Develop skills and increase knowledge
Assets – Advance process control – Improve plant reliability and
energy efficiency – Optimize production
processes Processes and structures
– Improve maintenance process
– Optimize logistics and supply chain
Work processes
& structures Assets
Operational excellence
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
SBPC adheres to BASF’s
high safety, health and environmental standards
SBPC always achieved good results in most demanding Responsible Care Audits
No lost time incidents in SBPC team since 2007
SBPC applied for Safety Grade A Standard – highest safety standard
in China – granted by Chinese
government
BASF quality management policy and processes
Safety comes first!
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
BASF and SBPC are committed to employee development
SBPC perceived as top employer in SCIP
Low attrition rate: < 4%
Reasons: – Safety culture and record – Inspiring business culture – Team building – Systematic people
development process – Training programs with
local universities and colleges
– Talent development for BASF in Greater China and beyond
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SBPC site presentation Ι September 27, 2013 Ι
1 | Building a world-scale isocyanates site
3 | Market approach
4 | Further growth plans
2 | Business performance
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Isocyanates – Raw materials for polyurethanes
Toluene diisocyanate
(TDI)
Polyether polyols
Flexible polyurethane foams
e.g. furniture, mattresses e.g. automotive seating
+ =
Methylene diphenyl
diisocyanate (MDI)
Polyether polyols
Rigid & microcellular polyurethane foams
e.g. insulating foams e.g. shoe soles
+ =
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Polyurethanes have versatile applications
Automobile & transportation
Construction & civil engineering
Furniture, interior fittings, sanitary
ware
Sports, recreation & leisure
Footwear
Electrical engineering, cables & electronics
Medical technology
Refrigerating & heating appliances
Polyurethanes
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
2010
CAGR >6%
22%
35% 28%
16%
MDI demand (in million metric tons)
20%
30% 36%
14%
~4.6 ~8.8
2020
BASF: #2 position in China
Fastest growth of MDI expected in China (~10% p.a.)
China will become largest market in 2020 (>3 million metric tons)
Growth drivers are: – Increased demand for
energy efficiency – Increasing standards of
living result in higher needs for • furniture, • footwear, • appliances, • performance textiles
– Growth in transportation and construction
MDI is a fast-growing market
Rest of Asia
Europe
Greater China
North and South America
Clockwise from top:
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
2010
CAGR >5%
22%
35%
28%
16%
TDI demand (in million metric tons)
16%
30% 40%
14%
~1.8 ~3.1
2020
Clockwise from top:
BASF: #1 position in China
Fastest growth of TDI expected in China (~7% p.a.)
China will become largest market in 2020 (>1.2 million metric tons)
Growth drivers are: – Replacement of palm
fibers and steel spring mattresses
– Increasing standards of living result in higher needs for furniture
– Growing demand for high-end coatings, including automotive applications
TDI – BASF is local market leader in China
Rest of Asia
Europe
Greater China
North and South America
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Geographic proximity: 70% of customers within 400 km around Shanghai
Major SBPC customers are leading companies in their industry
SBPC serves diversified customer portfolio
Enhanced market access through BASF China sales network
Synergies for cross divisional approach via Greater China industry teams
Multiple synergies
* Logos only represent examples of SBPC’s customers list
SBPC serves a wide range of customers*
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Video: Customer interview
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
SBPC business growth is based on customers´ trust:
Consistently high product quality
Supply reliability and flexibility to match customers‘ needs
Know-how sharing and customer education (e.g. EHS, supply chain)
Customer-oriented business approach „A customer‘s problem is also our problem“
Focus on long-term relationships in all phases of the business cycle 0
50
100
150
200
250
2008 2009 2010 2011 2012 2013 FC
CAGR ~18% p.a.
Example: Isocyanates business with Huafon (sales indexed, 2008 = 100)
Strong commitment to customers
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SBPC site presentation Ι September 27, 2013 Ι
1 | Building a world-scale isocyanates site
3 | Success factors
4 | Further growth plans
2 | Business performance
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
120
0
50
100
150
200
250
2006
MDI nameplate capacity (in thousand metric tons)
210
2014
160
0
50
100
150
200
250
2006
TDI nameplate capacity (in thousand metric tons)
185
2014
Further growth of TDI and MDI business in China
+16% +75%
上 海 巴 斯 夫 聚 氨 酯 有 限 公 司 Shanghai BASF Polyurethane Co. Ltd.
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SBPC site presentation Ι September 27, 2013 Ι
Local market leader in TDI, #2 supplier of MDI in China.
Focused on growing polyurethane markets in Shanghai, as well as in Jiangsu and Zhejiang provinces
Strong commitment to customers: Quality, flexibility, reliability
Success factors: Superior technology, operational excellence, employee involvement and dedication
Profitable and growing business since day 1 of operation
SBPC is a major contributor to BASF’s “grow smartly” strategy in Asia Pacific
SBPC – A succesfully growing joint venture