sunvic - corporate presentation sept 2011...

Sept 2011

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Agenda

� Overview

� Leading Manufacturer of AA & AE and PMIDA/Glyphosate

� Industry Outlook

� Financial Performance

� Ongoing Projects

� Investment Merits

Section One

Overview

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Overview Of SunVic

► First-mover and largest PRC-based company to undertake large-scale

production of acrylic acid (“AA”) and acrylate esters (“AE”)

► Leading manufacturer of PMIDA & Glyphosate

► Manufacturing facilities located in Yancheng (Chenjiagang Chemical

Zone, with a 3000-tonne liquid-cargo jetty) and Taixing in Jiangsu, PRC

► Client base of over 500 customers located in PRC and overseas markets

spanning across Asia, Middle East, Europe and North and South America

etc.

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Strategic Location

Yancheng, Chenjiagang Chemical Zone- AA (205Kpa) & AE (250Kpa)- 1,000,000-tonne Cracking Plant (to be

completed by Q4 2011)- A 3,000-tonne liquid cargo jetty

Nantong Port, Zhangjiagang Port, Shanghai Port,

Lianyungang Port

Liangyungang Port

Jiangsu province

- Good infrastructure and transportation links

► Located in eastern region of the PRC with highest growth in demand for AA and AE

► Proximity to our major suppliers in Jiangsu province and neighbouring Shandong province

► Convenient land and water transportation links

► Lower labour and land costs compared with Southern Jiangsu province

Taixing, Chemical Zone- Phase I of 160 Kpa AA plant (complete by end 2011)- Phase II of 160 Kpa AA plant (complete by 1H2012)

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Expanding Sales & Marketing Coverage

Asia Market

► More than 80% of our products

supplied to Asia (including the

PRC market)

Overseas Markets

► Overseas customers include

large MNCs such as Degussa

and ECEM B.V. in Europe

► Our products have also been

exported to Japan, Taiwan,

Hong Kong, India, Korea,

Southeast Asia, Australia, Europe and South and North

America

South and North America

Set up sales offices in Brazil and

Argentina

Set up sales and marketing subsidiary

in US

Over 500 customers around the

world

Over 500 customers around the

world

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AA & AE – Building Blocks For Essential

Industrial & Consumer Products

Source: CMAI

Super Absorbent Polymers (SAP)

Polyacrylates

Detergent Builders

Water Treatment

Detergents

Disposable Baby Diapers

Female Hygiene Products

Emulsions

Plastic Additives

Acrylic Rubber

Textile Treatments

Coatings, Adhesives, Sealants

Automotives

Textiles

AA

AE

Adult Incontinency Products

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PMIDA – Essential Material Of Glyphosate

PMIDA

Glyphosate(herbicide/ weeds killer)

(Effective in transgenic crops plantation)

Section Two

Leading Manufacturer of AA

& AE and PMIDA/Glyphosate

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Global Distribution of AA Production Capacity

Country/Region

America Europe PRC Japan Others Total

Capacity (‘000 tonnes)

1,355 1,290 1,138 600 773 5,156

Source: 2010 AA Industry Summary,

Author: Zheng Chengwang

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Global Top 10 ManufacturersNo. Company Name Country Global

Capacity

(KT p.a.)

1 BASF Germany 1,140

2 Dow Chemical U.S.A 600

3 Arkema U.S.A 595

4 Nippon Shokubai Japan 515

5 StoHaas Monomer U.S.A 430

6 Jiangsu Jurong (Sunvic) PRC 365 *

7 Formosa Taiwan 320

8 Shanghai Huayi PRC 200

9 LG Chemical Korea 193

10 American Acryl U.S.A 120

* Our new 160K TPA capacity is expected to start commissioning in Sept 2011.

Source: 2010 AA Industry Summary

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PRC major AA manufactures

No. Company Name Capacity

in PRC

(KT p.a.)

1 Jiangsu Jurong 江苏裕廊江苏裕廊江苏裕廊江苏裕廊

(Sunvic Chemical’s wholly subsidiary））））365

(by end 2011)

2 Shanghai Huayi （上海华谊） 200

3 Formosa（台塑集团） 160

4 Yangzi-BASF（扬子石化-巴斯夫） 160

5 Shenyang Chemical（沈阳石蜡化工） 80

6 Lanzhou Chemical（兰州化工） 80

7 Beijing Dongfang（北京东方） 80

8 Shandong Zhenghe（正和石化） 60

9 Zhejiang Weixing （浙江卫星） 40

10 Others 73

Total 1,138

Source: 2010 AA Industry Summary

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Major Manufactures of Glyphosate in PRC

Company Current

Capacity(Tonnes)

Expanding

Capacity(Tonnes)

Total

Capacity(Tonnes)

Zhejiang Xinan 30,000 50,000 80,0000

Nantong Jiangshan 27,000 25,000 52,000

Zhejiang Jiema 15,000 30,000 45,000

Jiangsu Jurong 40,000 (PMIDA) 40,000 (PMIDA)

Anhui Huaxing 15,000 20,000 35,000

Nanjing Red Sun 20,000 20,000

Jiangsu Yinyan 15,000 15,000

Zhejiang Jinfanda 12,000 12,000

Source: 《草甘膦市场调研报告》

Section Three

Industry Outlook

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Industry Outlook

► Our wide-application AA & AE products tapping into the strong

recovery of the PRC domestic market

► Demand for AA & AE in the PRC expected to grow at CAGR of

15-20% in next few years

► High entry barrier for new player

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AA & AE- Strong demand from Downstream Industries in PRC

Super Absorbent

Polymers (SAP)

As the improvement of living standard,

SAP consumption expected to grow at 20% in next few years

Coatings, paints

Adhesives, Sealants

Water Treatment

Booming property and automobile markets bring the increase in coatings and paints products, expected growth rate at 15%

Estimated growth at 5%

New water treatment technology increase the demand for AA & AE

Source : various media reports

Section Four

Financial Performance

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Financial Highlight

RMB ’ million 3 months Ended 6 months Ended

30 Jun 11 30 Jun 10 Change 30 Jun 11 30 Jun 10 Change

Group Revenue 934.7 820.4 14% 1,924.8 1,471.8 31%

Gross Profit 280.8 215.2 31% 629.3 314.3 100%

Gross Profit Margin 30.0% 26.2% +3.8 pts 32.7% 21.4% +11.3 pts

Profit Before Tax 225.5 139.8 61% 521.1 204.7 155%

Net Profit Attr to the Company

169.9 103.5 64% 391.1 156.2 150%

EPS(RMB cents/SGD Cents)

31.56.02

18.5 70% 71.813.73

28.0 156%

NAV per share (RMB cents/SGD Cents)

311.459.53

250.4 24%

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RevenuesRMB’mln

Since Q2 10, PMIDA production has been temporarily ceased, AA & AE sales contributed above 95% of total revenue

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Revenue by Quarter

RMB’mln

990.1910.3

951.4

820.4

651.4

934.7

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Profitability

Gross and Net ProfitsRMB’000

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Profitability by Quarter

Gross and Net Profits

RMB’000

• Q4 2010 net profits inclusive a tax rebate of RMB112.1 million

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Margin Analysis by Year

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Margin Analysis by Quarter

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Sales Volume

▶ AA & AE sales volume increased by CAGR of 40% for FY05 to FY10

▶ Sales volume increasing due to strong demand from downstream industries

Tonnes

AA & AE Sales Volume

CAGR (FY05-10): 40%

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Sales Volume by Quarter

▶ AA & AE production maintained as almost full utilization rate due to strong

demand for the products

Tonnes

AA & AE Sales Volume

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Sales Volume

▶ PMIDA production ceased since Q2 2010 due to weak demand from export market

Tonnes

PMIDA Sales Volume

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AA & AE Average Selling Price

AA & AE ASP vs Raw material- PropyleneRMB/ tonne

▶ AA conversion ratio from propylene is 1:0.75

▶ The average price is based on simple average price

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AA Price TrendRMB per tonne

20,000

AA’s raw material- Propylene Price Trend

Strong Demand Led to a Rising Selling Price

12,000

Source: www.16ds.com

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Utilisation Rate

AA and AE Capacity Utilisation

▶ AE is a downstream product of AA. We have flexibility to adjust AA or AE

production to better facilitate the market requirement

▶ Due to buoyant demand for AA & AE products, the AA production maintained

at almost full level of utilization

%

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Balance Sheet Highlight

RMB’ mlnAs at

30/06/2011

As at

31/12/2010

Current Assets 1,825.1 1,585.9

Current Liabilities 2,186.1 1,604.6

Non-current Assets 2,434.6 1,747.2

Non-current Liabilities 306.5 292.5

Shareholders’ Equity 1,701.9 1,368.4

Bank borrowings, net of deposits pledged

878.8 673.2

Cash and Bank Bal ( after net of deposits pledged)

159.9 226.8

D/E ratio 0.52 0.49

Section Five

Ongoing Projects

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Ongoing Projects

► Produce AA’s raw material - Propylene and other petroleum products

► Synergy in cost saving, production efficiency and sources sharing

► New streams to Group’s revenue and profit through sales of petroleum

related products

► Commence production in Q4 2011

1,000,000-tonne Cracking Plant

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Ongoing Projects

► Tapping into robust demand for AA & AE products

► Phase I of 160,000-tonne to start commissioning in Sept 2011

► Phase II of another 160-tonne to be completed by 1H2012

► With totaling 525,000-tonne AA capacity, Sunvic to be the LARGEST

manufactures in the PRC and

Top 5 in the world

► Expect to bring significant

contributions

320,000-tonne new AA Plants in Taixing

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Ongoing Projects

► Glyphosate is weeds killer which is effective in plantation of transgenic

crops

► Technology and network advantage in producing and marketing

Glyphosate

► Built up sales offices in South America, Brazil and Argentina

► Expect Glyphosate production licence to be granted in 2011

► Well-positioned to capitalise on opportunities when this segment

recovers

PMIDA Downstream Product-Glyphosate

Section Six

Investment Merits

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Investment Merits

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“We are optimistic about the outlook of the AA & AE industry in the PRC. We are well-positioned to capture the opportunity and stay competitive through our economies of scale and upstream integrated productions.

“ With our cracking plant and new AA plants coming on board in 2011 and 2012 respectively, we will be able to pursue a long-term sustainable growth and create more values for our shareholders.”

Sun Lipin Executive Chairman & CEO

Thank You

External Auditor: Ernst & Young

For more information, pls contact:

Lim Jin Sin, Financial Controller, jinsin@sunvic-chem.comJennie Liu, IR Manager, jennieliu@sunvic-chem.com

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Share Performance

Earnings Per Share (FY2010): RMB 1.19 or SGD0.2353Closing Price (2/09/2011): SGD0.555, 2.4X PEDividend for FY2010: SGD 2 cents (1 cent ordinary + 1 cent special)

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