London - November 20, Rhodia Eco Services. Jim Harton President. Be the supplier of choice

Transcription

1 London - November 20, 2009 Rhodia Eco Services Jim Harton President Be the supplier of choice

2 Agenda Rhodia Eco Services at a glance Regen Virgin Sulfuric Acid, derived from burning sulfur Strategic intent 2 Rhodia 2009 Capital Market Day

3 Rhodia Eco Services at a glance

4 Rhodia Eco Services overview 2008 figures Net sales $450 million Employees 450 Recurring EBITDA $106 million 6 industrial sites (all in USA) #1 in sulfuric acid regeneration Regen #1 in US merchant sulfuric acid 4 Rhodia 2009 Capital Market Day

5 Rhodia Eco Services business A common technology and asset base - Life-cycle management or regeneration of spent sulfuric acid, Regen, predominantly serves refineries and is driven by gasoline demand - Complementary to Regen, production of Virgin sulfuric acid (acid made from sulfur), serving major chemical companies in diverse markets Key success factors: Supply chain management & Reliability - Operating and maintenance know-how are critical - Logistics & network management are key to cost control - Safe performance and Absolute Reliability are essential Most of the business is conducted under multi-year contracts - Volumes are typically 100% of a refinery's requirements - Pricing is indexed to major cost drivers (sulfur, energy, etc.) 5 Rhodia 2009 Capital Market Day

6 Rhodia Eco Services supply chain focus on absolute reliability A network of 8 acid plants in 6 locations 830 railcars Martinez, CA Hammond, IN 30 contract carriers Dominguez, CA Houston, TX Baton Rouge, LA Baytown, TX >3,000,000 ton/year production capacity 150,000 tons storage 6 Rhodia 2009 Capital Market Day 20 Barges

7 Regen

8 Regeneration process: Thermal decomposition of spent acids to SO 2 followed by gas cleaning, SO 2 oxidation, and SO 3 absorption Sulfuric Acid Regeneration Process Spent Sulfuric Acid Fuel Air Sulfur Derivatives Steam for Plant Storage and Mixing Furnace Boiler Quench Oxygen Sulfuric Acid Purification Coolers SO 3 Absorption Tower Dilute H 2 SO 4 SO 3 Commercial H 2 SO 4 Drying Tower Electrostatic Precipitator Regeneration is the reliable, environmentally-friendly alternative to neutralization and disposal which would cost >2x more 8 Rhodia 2009 Capital Market Day

9 Regen is a regional market, highly concentrated West Coast (23% of market) Rhodia 65% Other 35% Rhodia 45% Midwest (13% of market) Other 55% Northeast (10% of market) Other 100% Rhodia 63% Gulf (54% of market) Other 37% Overall NA merchant regeneration market share General 9% 1% PVS Marsulex 9% DuPont 14% 53% Rhodia Chemstrade 14% Rhodia, big in the biggest areas; 66 years of market leadership Source: Rhodia estimates 9 Rhodia 2009 Capital Market Day

10 Regen customer base: Good market alignment Eco Services is the major partner of 4 of the 5 largest integrated refining companies in NA, and holds 2 nd position with 3 other large players SHELL OTHERS 29% EXXONMOBIL Major partner CHEVRON 45% 26% VALERO Partial position CONOCOPHILLIPS TESORO BP 10 Rhodia 2009 Capital Market Day

11 Revenues under contract Regen Basis 100 Key success factors: Strong relationship, Reliability and Safety in handling Planned Evergreen Under Contract Long term visibility and business stability Contract renegotiation initiated well in advance 11 Rhodia 2009 Capital Market Day

12 Regen market dynamics Regulatory developments promoting ethanol use and increased fuel efficiency Competitive pressure may drive industry rationalization, which should favor large, integrated refineries (cost competitive advantage) Rhodia with its strong presence beside large refineries, best aligned with market dynamics for the long term 12 Rhodia 2009 Capital Market Day

13 Virgin Sulfuric Acid, derived from burning sulfur

14 Rhodia is focused on the non-fertilizer and non-metals production segment 2008 figures Total of USA merchant acid market = 6.9 million tons* Vessel Imports (Smelter) 5% 5% Gen Tek 9% DuPont Rhodia is the largest Sulfur burning merchant Acid producer in the USA Smelters 48% 12% 21% Rhodia Long term contracts with large industrial users protects against swings in Byproduct Market (smelters) Others * Out of USA Virgin Acid market of c. 35m tons/year (including fertilizer and metals production segments) Source: Rhodia estimates 14 Rhodia 2009 Capital Market Day

15 Market segments served by Rhodia Others industrial chemicals Batteries, Paper, Chemical production 34% 35% Nylon Engineering plastics, Carpet Agricultural Chicken feed, Phosphoric acid 22% 9% Specialized mining Insulation, Specialized glass 15 Rhodia 2009 Capital Market Day

16 Revenues under contract Virgin Basis 100 Key success factors: Strong relationship, Quality, Reliability and Safety in handling Planned Evergreen 0 Under Contract Multi-year contracts and predictable capacity utilization create earnings stability 16 Rhodia 2009 Capital Market Day

17 Strategic intent

18 Rhodia differentiated service offering: Absolute Reliability model Cash management Operational excellence HSE* excellence Supply chain excellence Commercial excellence Highly skilled workforce Reinvestment justification Absolute Reliability Stable results for Rhodia Customer value: Excellent service Confidence to enter into long term contracts * Health, Safety and Environment 18 Rhodia 2009 Capital Market Day

19 Going forward, Eco Services will continue to be a strong and reliable cash generator Sustain our Regen leading position by continuous provision of absolute reliability to our customers and a safe working environment through consistent capital investment in our manufacturing plants and logistics infrastructure Provide demand and revenue stability for Virgin acid through long term contracts with large industrial users who value quality and reliability of supply 19 Rhodia 2009 Capital Market Day

20 Rhodia Eco Services Insure a profitable partnership with refining and chemical industry customers by providing a sustainable solution for their production and environmental needs