#1CFS Camlin Fine Sciences Camlin Fine Sciences Ltd. Plot No. F/11 & F/12, WICEL, Opp. SEEPZ Main Gate, Central Road, Andheri (E), Mumbai-400 093, India. T: +91 22 6700 1000 | F: +91 22 2832 4404 | E: [email protected] | www.camlinfs.com ISO 22000 Certified Company | CIN L74100MH1993PLC075361 Date: 24/05/2016 To, BSE Limited, 25, P. J. Towers, Dalal Street, Mumbai 400 001 Ref: Company Scrip Code: 532834 To, The Manager, Listing Department, National Stock Exchange of India Ltd., Exchange Plaza, Bandra Kurla Complex, Bandra (East), Mumbai- 400051 Ref: Symbol: CAMLINFINE || Series: EQ Sub: Intimation pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 - ("SEBI LODR") This is to inform you that the senior management team of the Company shall engage in meetings with domestic and international institutional investors and analysts amongst others in major investor hubs from May 25, 2016 upto June 06, 2016. In this regard, please find attached a presentation prepared by the Company. It is clarified that the presentation and the information contained therein does not constitute or form part of an invitation or solicitation to offer to purchase or subscribe to any securities of the Company in any jurisdiction. This presentation has been prepared for information purposes only. The information contained in the investor presentation is not to be taken as any recommendation made by the Company or any other person to enter into any agreement with regard to any investment. We request you to take the above on record and the same be treated as compliance under the applicable Regulations of SEBI LODR. Kindly take the above information on records. Thanking You, Encl.: a/a. For Camlin Fine Sciences Limited Rahul D. Sawale Group Company Secretary CAMLIN SCIENCES#2May 24, 2016 CFS Camlin Fine Sciences Shelf-life solutions | Performance Chemicals | Aroma Chemicals Corporate Presentation#3Disclaimer . This presentation is confidential and may not be copied, published, distributed or transmitted. The information in this presentation is being provided by Camlin Fine Sciences Limited (also referred to as 'Company'). By attending a meeting where this presentation is made, or by reading this presentation material, you agree to be bound by following limitations: The information in this presentation has been prepared for use in presentations by Company for information purposes only and does not constitute, or should be regarded as, or form part of any offer, invitation, inducement or advertisement to sell or issue, or any solicitation or any offer to purchase or subscribe for, any securities of the Company in any jurisdiction, including the United States and India, nor shall it, or the fact of its distribution form the basis of, or be relied on in connection with, any investment decision or any contract or commitment to purchase or subscribe for any securities of the Company in any jurisdiction, including the United States and India. This presentation does not constitute a recommendation by the Company or any other party to sell or buy any securities of the Company. This presentation and its contents are not and should not be construed as a prospectus or an offer document, including as defined under the Companies Act, 2013, to the extent notified and in force or an offer document under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 as amended. The Company may alter, modify, or otherwise change in any manner the contents of this presentation without obligation to modify any person of such change or changes. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained in this presentation. 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This presentation contains certain supplemental measures of performance and liquidity that are not required by or presented in accordance with Indian GAAP, and should not be considered as an alternative to profit, operating revenue or any other performance measures derived in accordance with Indian GAAP or an alternative to cash flow from operations as a measure of liquidity of the Company. You must make your own assessment of the relevance, accuracy and adequacy of the information contained in this presentation and must make independent analysis as you may consider necessary or appropriate for such purpose. Any opinions expressed in this presentation are subject to change without notice and past performance is not indicative of future results. 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The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding expansion plans and the benefits there from, fluctuations in our earnings, our ability to manage growth and implement strategies, competition in our business including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, our ability to win new contracts, changes in technology, availability of financing, our ability to successfully complete and integrate our expansion plans, liabilities, political instability and general economic conditions affecting our industry. Unless otherwise indicated, the information contained herein is preliminary and indicative and is based on management information, current plans and estimates. Industry and market-related information is obtained or derived from industry publications and other sources and has not been verified by us. 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This presentation is not an offer for sale of securities in the UNITED STATES or elsewhere. 1 CFS Camlin Fine Sciences#4CFS Camlin Fine Sciences Camlin Fine Sciences Limited (CFS) Leveraging core competencies to address a large target market 2#5CFS - Providing shelf-life solutions along with aroma and performance chemicals to target large end user industries Shelf-life Solutions • Shelf-life extension products • Presence in antioxidants and intermediates for food, feed, pet food and animal nutrition Performance Chemicals • Wide array of applications • Fast growing segment for CFS through new product introduction, scale and technology Aroma chemicals • Synthetic replacement for natural Vanilla and offers multiple advantages like lower cost, improved availability and consistency Food Pet food Pharma intermediates Agrochemicals Feed & food Consumer goods Animal Nutrition Rendering Dyes and colours Petrochemicals Incense Sticks Flavours & Fragrances Aqua Culture Bio-fuels Pharmaceuticals CFS' products find applications in wide spectrum of products in food, animal nutrition, pet food, consumer goods and industrial uses CFS Camlin 3 Fine Sciences#6CFS | Key strengths and differentiators Strong financials and cash 8 flows 1 Global player in shelf-life solutions across food, feed and pet-food Integrated across the value chain 2 7 Experienced promoters and professional management team CFS Camlin Local presence in global markets 3 Fine Sciences Proven ability to acquire and 6 improve business performance Advanced R&D facilities 5 4 Diversified customer base 4 CFS Camlin Fine Sciences#7Global player in shelf-life solutions and intermediates for food, feed and pet food Strong presence in basic food grade¹ antioxidants; gradually expanding into blends Global antioxidants (industry size of ~US$3.2bn) Natural antioxidants Synthetic antioxidants TBHQ + BHA CFS has a significant share in TBHQ and BHA globally Source: Technavio 1 includes food, feed and pet food Blends Xtendra /NaSure CFS is establishing its presence into Blends through its brands Xtendra and NaSure - 5 CFS Camlin Fine Sciences#8Diversified product base Across antioxidant, aroma and performance chemicals segments CFS' product portfolio Others: 1% Segment Product Applications Aroma: 3% Diphenols Catechol Diphenols: 18% HQ Antioxidants TBHQ ВНА BHT Ascorbyl Palmitate Blends Intermediate other compounds used in Pharma, Agrochemicals and fragrance industries ⚫ Stabilization of monomers, intermediate compound used in Pharma, Agrochemicals, Dye stuff, Feed and food • Food and feed antioxidant to extend shelf life of products; used for stabilizing oils, fats, butter & margarine • Food and feed antioxidant to extend shelf life of products; used for stabilizing oils, fats, butter & margarine Food antioxidant used in Cosmetics and pharma products • Antioxidant for sensitive products like baby food, instant milk formula • Antioxidants to extend shelf life of food, feed and pet food products Performance Chemicals: 22% Antioxidants: 56% Revenue (FY16) Performance Chemicals Guaiacol • Food, Flavours and Fragrances, Pharma intermediates Veratrole TBC MEHQ Other HQ and Catechol derivatives Aroma Chemicals Vanillin/ Ethyl Vanillin Others ⚫Building block for other compounds in Agrochemicals, Consumer goods & healthcare Stabilization of monomers • Stabilization of monomers, building blocks for agrochemicals • Intermediate for Dyes, Pigments and Colours amongst others • Aroma compound in flavour and fragrances; Agro, Feed & Food, Consumer Goods & Healthcare • Different applications for products across Agrochemicals, Pharma, cosmetics etc. 6. CFS Camlin Fine Sciences#9Fully integrated across the value chain Ensures better control on supply chain, realizations and margins Key Raw Material Phenol Commodity chemical Versalis; Novapex CFS Europe Diphenols Eastman; Mitsui Hydroquinone Catechol Solvay/Rhodia; Ube Other CFS group entities¹ Shelf Life Solutions Ascorbyl Palmitate² Blends TBHQ Guaiacol BHA Performance Chemicals MEHQ Aroma Vanillin Veratrole Other derivatives of HQ Ethyl Vanillin Other derivatives of Catechol Fully integrated from diphenols to step down derivatives, antioxidant blends and Vanillin thereby reducing risk of supply chain disruptions 1 Includes products manufactured through contract manufacturing for CFS 2 Ascorbyl Palmitate is not a part of HQ/ Catechol value-chain and is manufactured from ascorbic acid CFS Camlin Fine Sciences 7#10Local presence in global markets On-ground presence in America and Europe with strong India footprint Geographical reach across key markets Iowa, USA Mexico city Cuba Guatemala ☐ Columbia O Owned Plants Outsourced Manufacturing ▲ Blending Facility R&D/ Food Labs | Marketing offices Peru Denmark Netherlands United Kingdom Ravenna, Italy Indaiatuba, Brazil Tarapur Shanghai, China Khopoli Mahad Mumbai CFS' global footprint is expected to improve orders from global MNCs who prefer their suppliers to have local presence across geographies CFS Camlin 8 Fine Sciences I#11Diversified customer base Across customers geographies and end-user industries Revenue base diversified across geographies Going forward diversification should increase further Currently ~56% revenues are from food grade antioxidants; Performance Chemicals (PC) contributes to ~22% of revenues, Diphenols (HQ & Catechol) constituted ~18% while Aroma Chemicals (Vanillin) is at an early stage contributing ~3% of FY16 revenues 11% 9% 5% 19% FY16 Revenues 25% 31% ■ Europe ■Asia Pacific (exc. India) ■India ■ South & Central America ■ North America ■ Others • In FY16 blends business contributed to ~1.0% of consolidated revenues of CFS group As PC, Vanillin and Blends businesses grow the revenue diversification across products as well as clients should increase further • Acquisition of Dresen Quimica in Mexico will further diversify the spread of revenues for CFS - Geographical for CY15, Dresen Quimica (consolidated) had revenues of US$16.45mn largely from Mexico, Central America and parts of Latin America - Entry into new customers Opportunity to cross-sell Dresen's products to CFS' global customers and vice-versa Fine Sciences Revenue base diversified across geographies and customers; acquisition of Dresen Quimica is expected to further diversify revenue base CFS Camlin 6#12Continuous investments in R&D across geographies... R&D facilities across the world with #34 scientists across 2 R&D labs and 4 Application Labs Application Labs Iowa, USA Ravenna, Italy Developing customized blends for - Mexico city various applications Technical assistance and development support to customers • Testing parameters of defined performance •Conducts stability studies for shelf life of various products Indaiatuba, Brazil 10 Mumbai, India Tarapur, India! R&D Labs • Development of new products and value additions to existing products Product and process improvements • Catalyst application & development Focusing on developing derivatives of HQ and Catechol Pilot plant Ability to run small batch sizes and stabilize the process before commercial scale manufacturing • Process improvements CFS Camlin Fine Sciences#13...has enabled process improvements and global certifications Approval for green process to manufacture Guaiacol Ex-ONCB route (concerns on being carcinogenic and environmentally harmful) Chlorobenzene Benzene Ex-Catechol route (believed to be environment friendly) Phenol ONCB O-anisidine Catechol Guaiacol Vanillin Patent applied for by CFS Process used by CFS L CFS has applied for patent of the environmentally friendly ex-Catechol process, which is a preferred approach for manufacturing of Vanillin Major certifications ISO 2008 ISO 2005 SGS Cat Camlin Fine Sciences Limited Por No D-2 MDC Am Boisar Tampur Detic-Pigher Camlin Fine Sciences Limited SGS ISO 9001:2008 SGS Den De Mand of fond Grade FreChina Harmediates, fpacity UKAS ISO 22000:2005 Receiving of raw material, addtion, heating, thation processing backing & storage depech at food grade artioitanta name THE BHA Ascorby amento, food andoriant blends and Ford of Fred Grade RHT (Ray) (Fose Sector 1 Ford Additives) This dom 01 December 2015 until 20 Nevindar 2016 and remains ad set to satisfactory surv SGSSG FSAAI certificate Kosher BHA & TBHQ 4ttery भारतीय Government of India Food Safety and Standards Authority of Ind STAR-K KOSHER CERTIFICATION ff, 2006 for 1&2, Food Safety and Standards Act, 2000 License Number: 10012022000107 MDC MC ARLIN PINE SCIENCESUITED mpany Cry of La Central -w/Dew 2004 www 2004/20 (Decated) Itens of Food products with authorized to Manufacture/ Re-pack/ Re-label handling Designated Capacity AS KUMAR DESIGNATED OFFICER 11 Kosher Vanillin & TBC Halal certificate Renewal STAR-K KOSHER CERTIFICATION Ma Ga Ads) The de 3 productie in high by CAMLEDE SCENCES PLEASE VIL HE FOLLOWING CONDITION OF LEXIPATIN Al prided bunda ermed er wared by Cans Pine Se Lad of D Pilger Mahad Talislarigid's bl The focation is valid through April 30, 2017 and is abject BRAND: Ca Mub Maha 400 099 This city the spected the go by CAMLD FIVE SCIENCES PLEASE NOTE THE FOLLOWING CONDITIONS OF CERTIFICATIONS The leer of cation israll though April 30, 2017 and is subject to real BRAND C Eliyah human Drector of Supantsin PRODUCTLISTING ET04/30/2017 +TanBuchel (TBC) Flakas KRGWIESHW X Solution Eliyahu Shum De Effective Though (4/30/2017 12300 2000 41444ax: 00-4534 www.g حلال Registration No.0290 HALAL Halal Committee, Jamiat Ulama - E-Maharashtra Registration Certificat This is to certify that, M/s Camlin Fine Sciences Limited. Situated at, Plac No D.33 MDC Tarpor Boise Theme Maharashtra Jadid Office Address Plot No F11 & F/12 WKEL MIDC Marol Contral Roal Op SEEPZ Main Gate Andheri (E) Manh-400093 s registered with Halal Committee for the following Product(s) J. Butylated Hidroxy Anisole (BHA) Tertiary Butyl Hydroquinone (TBHQ 3 Ascorbyl Pulmature (ASP) Famil Xtendra Solation Butylated Hydroxy Toluene (BHT Validity: From 15.06.2015 14.06.2016 Date of base. 01.06.2015 Certificate No-16014 Gulzar Ahmed Azni General Secretary chashind.com Card Ne CFS Camlin Fine Sciences#14Proven ability to acquire and turn around businesses CFS' acquisition and turnaround of Italian subsidiary was well conceived and executed Demonstrated experience in acquiring and integrating companies CFS Camlin Fine Sciences Acquisition of CFS Europe, Borregaard's Italian subsidiary for EUR1.4mn Acquired in 2011 . ● At acquisition, Borregaard's Italian subsidiary was engaged in the manufacturing of HQ and Catechol The acquisition gave CFS a significant presence in the European market; helped CFS backward integrate to secure the sources of HQ and Catechol for global operations Company's first international acquisition At acquisition it had a capacity of 6,600MTPA which has been increased to 12,000MTPA through de-bottlenecking and incremental capex Revenues have grown substantially... INR mn 2,289 1,881 1,467 FY12 2,973 2,258 ...with significant improvement in PAT margins 0.4% 0.4% 3.6% 10.8% FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 CFS' acquisition, turnaround and integration of CFS Europe is a reflection of the management capabilities of CFS team 12 12 7.9% FY16 CFS Camlin Fine Sciences#15Leadership team across the globe to address customer demands locally CFS' top management operates from across the world Jack Boers Senior VP-Antioxidant Strategy and Business Development Sandra Grossmann Global Business Development - Pet-food CFS North America Jennifer Igou VP - Sales, CFS North America Arturo Javier Dávila Cabrera VP - Sales, Mexico, Central America Luciano dos Santos Monteiro General Manager, South America Jorgen Sorensen Global VP- Antioxidants Antonio Menezes Managing Director, CFS Europe 13 Ashish Dandekar Managing Director, CFS Anne-Mette Frost Global Application Manager R. Shiv Kumar General Manager CFS Camlin Fine Sciences#16Experienced leadership team Experienced leadership team Anne-Mette Frost Global Application Manager Antonio Menezes Managing Director, CFS Europe Arturo Javier Dávila Cabrera VP Sales Mexico, Central America Jack Boers Senior VP- Antioxidant Strategy & Business Development Jennifer Igou VP - Sales, CFS North America Experience in the food industry with a specialization in antioxidants for over 23 years • Having graduated as a food technologist from the Danish Meat Trade College, she has experience in organizations like George Weston Food Ltd. and DuPont Nutrition & Health •Post Graduate in Agricultural Sciences with over 40 years of experience in companies like Montedison SPA and ENI Group • Currently the Managing Director of CFS Italy, he was part of the erstwhile Borregaard Italia SPA • Experience of over 3 decades in food ingredients sector in industries like fats & oils, meat, confectionary with companies like AAK, Du Pont and others • Extensive experience in sales & marketing, strategy and product development • Mr. Boers is the founder of Vitablend Holding BV., The Netherlands. •He was the Managing Director and Member of the Board of Vitablend from November-2001 to April-2013 •He is also the Co-owner of The Better for You Company BV • Experience of ~14 years in antioxidants for food and beverage ingredients with leading companies like FMC and Kemin Strong technical know-how with extensive experience in sales & marketing Holds a Bachelors of Arts, Chemistry & Microbiology from University of Northern Iowa Jorgen Sorensen Global VP- Antioxidants Luciano dos Santos Monteiro General Manager, South America R. Shiv Kumar General Manager Sandra Grossmann Global Business Dev. - Pet-food- CFS North America •Over twenty years of experience in management positions within the food ingredients & packaging industries with a focus on food and pet food applications • Past experience has been in a Global Danish food ingredients company where he leading their antioxidant solutions business to a premier position within the global food industry • Operational experience of ~17 years in the field of chemicals with companies like CFS, BM&F and Kemin • Experienced in handling operations during the start-up and development stages of a business . . • Experience of around 2 decades in leadership roles with different business units of Jubilant Group In-depth understanding of agrochemicals, pharma, animal feed, nutraceuticals, vitamins and fine chemical Industries in greater China •Holds an MBA (international Marketing) from FMS, India and B.Tech from National Dairy Research Institute B.S. in Food Technology with 25 years of technical and commercial expertise in the pet food industry including product management, product development, sales and marketing, and production. Certified Product Manager 14 CFS Camlin Fine Sciences#17Robust financial profile¹ CFS' Income has grown steadily... Revenues (INR mn) ...with improving EBITDA margins... EBITDA margin (%) ...that has led to healthy operating cash flows 19.1% 600 5,583 16.2% 5,087 4,893 400 14.9% 13.8% 3,736 12.0% 200 3,352 0 CFO (INR mn) 556 463 267 (200) (400) (319) FY12 FY13 FY14 FY15 FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16 It has consistently reduced leverage... Debt/Equity ratio ...even while increasing asset base... Net Fixed Assets ...thus supporting improvement in its ratios ROCE 2.4 1.9 1.6 1,052 1,092 1.2 840 761 0.9 1,653 25% 20% 15% 10% 5% 0% FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY162 FY12 FY13 FY14 FY15 FY162 CFS aims to increase its profitability further, by moving up the value chain and increased capacity utilization 1 Consolidated financials; 2 Total debt for FY12-FY15 includes current portion of LT Debt; for FY16 the debt number doesn't include the current portion of LT Debt ROCE is calculated as EBIT/Average Capital Employed; EBITDA includes Other Income and margins are calculated on gross basis CFS Camlin Fine Sciences 15#1816 CFS Camlin Fine Sciences Future growth strategy#19Key growth drivers for CFS Capacity expansion through new plant at Dahej SEZ Focus on blends for food, feed and pet food CFS Camlin Fine Sciences Leverage Mexico acquisition to expand presence & product basket 11 17 Scale Vanillin business Increased revenue from introduction of new derivatives of HQ and Catechol CFS Camlin Fine Sciences#20Focus on synthetic and natural blends for food, feed and pet food Blends market offers large opportunities antioxidant blends for food, feed and pet food Natural Blends Synthetic Blends CFS has started focusing on this segment recently and intends to gain market share + Product portfolio including products in animal nutrition segment acquired as part of acquisition of Dresen, Mexico Key initiatives in blending business • Product development - CFS has developed blends tailored to needs of specific industries/ clients under the brand name Xtendra and NaSure (plant based antioxidant products) • Sales and Marketing push - Training and addition to marketing team with specialized product knowledge • Applications lab - Application labs have been set up across various locations • Local reach across the globe through acquisitions, organic growth Entry into blends increases the addressable market in antioxidant business multifold 18 CFS Camlin Fine Sciences#21Scale Vanillin business Focus on and grow the Vanillin business Key initiatives in Vanillin business Natural Vanilla Vanilla flavor/ fragrance (natural and synthetic) Ex-ONCB process (potentially carcinogenic; less cost effective; higher pollution) Fragmented market Synthetic Vanilla Ex-catechol process (preferred manufacturing route; constrained by availability of Catechol) Dominated by players with access to Catechol Vanillin Ethyl Vanillin • Process patent for conversion of Catechol to Guaiacol which is an intermediate compound to Vanillin (applied for) • Proposed plant at Dahej will add capacity for manufacturing of Vanillin and Ethyl Vanillin Key USP offered by CFS • Vanillin manufactured through ex-catechol process; complete traceability of raw material CFS, with access to Catechol, is setting up own/ contract manufacturing capacity to manufacture Vanillin and Ethyl Vanillin 19 CFS Camlin Fine Sciences#22Increased revenue contribution from performance chemicals business Performance chemicals present a large opportunity Revenue contribution from performance chemicals has increased over the last 2 years... 0.6% 1% ...and CFS is implementing plans to keep growing at a fast pace 13% Anti oxidants ■Diphenols Key initiatives in performance chemicals business • Deeper marketing penetration by adding distribution channels in new geographies Create distribution hubs in key markets like North America, Asia and Latin America and leverage on its presence in these markets • R&D labs at various stages of development of derivatives of diphenols and process engineering to improve commercial viability of certain other products • Hired senior level team across key geographies Key USP offered by CFS . Performance Chemicals 29% FY14 Revenues 57% ■ Aroma ■Other products 22% 18% 3% 1% FY16 Revenues Anti oxidants ■Diphenols Performance Chemicals 56% Aroma Other products · Fully integrated operations reduce supply chain risks • Offers complete traceability of raw material Note: PC Performance Chemicals CFS aims to grow the portfolio to increase its market share in performance chemicals 20 20 CFS Camlin Fine Sciences#23Leverage Mexico acquisition to expand presence & product basket Mexico acquisition offers significant synergies with CFS About the acquisition US$ 000s CY14 CY15 DRESEN CFS, through a WOS, acquired 65% of Dresen Quimica for a consideration of USD 7.8mn The company was acquired along-with its group companies as under: ■ Inustrias Petrotec de Mexico (Mexico) Nuvel, S.A.C (Peru) Britec, S.A. (Guatemala) Net Sales 14,799 16,458 Operating Profit 975 2,012 Operating Profit% 6.6% 12.2% PBT 1,283 2,625 Inovel, S.A.S (Colombia) ■ Grinel, S.A. (Dominican Republic) PBT% 8.7% 16.0% The transaction was completed earlier in May and full impact of the same will be visible in quarter ended September 30, 2016 Net Worth 6,563 7,889 About Dresen Potential synergies with CFS engaged in the Leading Central American company research, development, manufacture and sale of specialty chemicals Organized in two main business segments: Animal Feed and Food Human segment manufactures adsorbents, antioxidants, bactericides, binders, mold inhibitors and acidifying agents; one of the larger suppliers in its key markets ☐ Industrial Products segment Operations across Mexico, Central America and parts of Latin America Cross-sell products – Dresen has a well regarded animal nutrition business and CFS will market the same across other geographies; similarly CFS products can be marketed by Dresen - Improved vertical integration Dresen uses the diphenols as raw materials; the acquisition helps Dresen secure raw material and secures supply contracts for CFS Improved margins for CFS on account of higher value addition done by Dresen • Improved geographical reach to service global MNCs locally . Technical know-how in animal nutrition which can be leveraged across the CFS group to provide better products and services to customer • Strategically located manufacturing facility Mexico offers significant synergies with CFS and can improve CFS' product basket, geographical reach and profile amongst potential customers 21 21 CFS Camlin Fine Sciences#24Proposed expansion at Dahej plant Key characteristics of the proposed plant at Dahej Particulars Details Proposed area for the plant Dahej SEZ, Gujarat Land area Expected location advantages 67,507 square meters Availability of key raw-materials in vicinity Situated near ports and good connectivity Good infrastructure Conducive for future expansion Advantageous for tax and excise benefits as it is in a SEZ Common effluent treatment plant Product particulars Overall plant (current thought process) Capacity Proposed Capacity for key products Product HQ and its derivatives Catechol and its derivatives Vanillin HQ 9,000MTPA Catechol/ Vanillin - 6,000MTPA Expected commissioning FY18 Expected year of commercial production FY19 Status of project Basic engineering completed; Detailed engineering ongoing Environment approval - Awaited The plant at Dahej will expand capacities and provide CFS with a base to manufacture HQ, Catechol and Vanillin in India 22 22 CFS Camlin Fine Sciences#2523 CFS Camlin Fine Sciences Annexure#26Camlin Fine Sciences ("CFS") | A quick introduction Company Overview CFS is a global player in shelf-life solution chemistry Summary financials (INR mn) FY14 FY15 FY16 ■ One of the leading manufacturers of TBHQ and BHA Net Sales 5,087 5,583 4,893 Global reach through manufacturing plants across India, Europe, Latin America with customers across key markets EBITDA 713 925 961 EBITDA% 13.8% 16.2% 19.1% ☐ Marquee client base; end-uses across Food, Pet food, Animal feed, Vanillin and Performance Chem. Vertically integrated company in the chemistry it operates in manufacturers (including contract manufacturing) entire chain of antioxidants, blends, Vanillin and Performance Chemicals derived from PAT 287 550 358 - PAT% 5.6% 9.6% 7.1% Phenol Net Worth 933 1,349 1,762 The company was demerged from Camlin Limited (erstwhile group company) and listed on Indian exchanges in 2006 Net Debt² 1,341 1,407 1,4833 Share price performance - CFS¹ Shareholding (as at March 31, 2016) 130 120 110 100 90 80 70 60 50 Jan-15 May-15 Sep-15 Jan-16 May-16 55.7% 4.5% 39.8% Other details Credit Rating ■ Promoters ■Insti Investors ■ Others Fitch: LT - Ind A; ST - Ind A1 Bankers to the IDBI Bank, Bank of India, OBC, Company Auditors SBI, SBT, EXIM Bank, SBP M/s. B.K. Khare & Co. Exchanges listed BSE ONSE EXPERIENCE THE NEW 1 Data from BSE Ltd. as on May 22, 2016 2 Net Debt for FY14 and FY15 includes current portion of LT Debt During the FY16 there is a charge for INR45.47mn due to short receipt of insurance claim relating to a fire which occurred during FY14 EBITDA includes other Income. Margins are calculated on gross basis SBT State Bank of Travancore; SBI - State Bank of India; SBP - State Bank of Patiala; OBC - Oriental Bank of Commerce 24 Market Cap¹ INR 9,100mn 52 wk. high/low¹1 INR 128.8/ INR 76.1 CFS Camlin Fine Sciences#27The story so far 2012 2011 2009 2006 2014 2015 2016 Acquisition of 65% stake in Dresen Quimica S.A.P.I.de C.V., Mexico along with its 5 subsidiaries in Mexico, Peru, Guatemala, Columbia and Dominican Republic The acquisition has helped the company to expand its market reach in Central and South America and parts of Latin America Listed on the National Stock Exchange Forayed into blends business in USA Started manufacturing & marketing of customized blends in Tarapur and Brazil Set up Application laboratories fully supported by an experienced technical team Launched Aroma and Flavoring Compounds - Vanillin/Ethyl Vanillin Acquired CFS Europe S.p.A Became an integrated manufacturer of Diphenols Launched a wide range of Performance Chemicals like MEHQ, Veratrole, Guaiacol etc. Became significant producer of food antioxidants globally: TBHQ & BHA Part of Camlin Group, name changed to Camlin Fine Chemicals Pvt. ltd Became a public limited Company (CFCL) Demerged from Camlin Limited and listed on the Bombay Stock Exchange 25 CFS Camlin Fine Sciences#28Current entity structure Camlin Fine Sciences Ltd. 100% CFCL Mauritius Pvt. Ltd. (Mauritius-Holdco.) 100% CFS Europe SPA. (Italy) Step-down subsidiary in Ravenna for 100% CFS do Brasil Indústria, Comércio, Importação E Exportação De Aditivos Alimentícios Ltd. (Brazil) Subsidiary in Brazil for manufacturing and marketing of blends 100% CFS North America LLC. (U.S.A.) Subsidiary in USA for manufacturing and marketing of blends 100% Solentus North America Inc. (Canada) Subsidiary in Canada for marketing of blends 100% CFS Antioxidantes De Mexico S.A. De C.V (Mexico - Hold Co.) 65% Dresen Quimica S.A.P.I. de C.V.(Mexico) 100% CFS International Trading (Shanghai) Ltd. (China) Italy, manufacturing of HQ and Catechol 100% 100% 100% Industrias Nuvel, S.A.C Petrotec de Mexico, S.A. (Peru) Britec, S.A (Guatemala) de C.V.(Mexico) Parent company Subsidiaries/ Step-down subsidiaries Step-down subsidiaries pursuant to Mexico acquisition 26 100% Inovel, S.A.S. (Columbia) 100% Grinel, S.A (Dominican Republic) CFS Camlin Fine Sciences#29Reputed Directors on the Board Dilip D. Dandekar Chairman & Non Executive Director Ashish S. Dandekar Managing Director • An experienced industrialist, he has been actively involved in providing guidance for framing business policies & overseeing the all round progress of the Company • Rich experience with various industrial bodies, he is also a chairman of Kokuyo Camlin Limited, Honorary Consul of Consulate of Mongolia, Mumbai and a member of executive committee of FICCI • Wide experience of over 3 decades in pharma and fine chemical products • Experienced in different departments like business planning, information systems, R&D, product development and marketing Holds B.A. in Economics and Management Studies from Temple University, USA Pramod M. Sapre • Long and varied experience in the field of marketing of pharmaceutical products Independent Director • Has been associated with the company since 2006 Sharad M. Kulkarni Independent Director • Holds a B.Sc and Diploma in Marketing Management • Associated with the company since 2006, he has around 5 decades of rich experience across various roles • Previously has been CEO and President of major corporates; currently acts as a business advisor and management consultant to several Indian and international companies • Holds a B.E. Engineering, from University of Pune and is a Fellow of the Institute of Engineers, India Leena Dandekar Whole-time Director • Wide experience of over 2 decades in the field of Finance, Systems, ERP implementation, HR and Administration • Holds a B. A. in Economics and M.M.S from university of Mumbai Bhargav A. Patel Independent Director • An industrialist with wide experience in the field of Engineering, Textile Machinery and Leather industry • Has been associated with the company since 2009 Holds an M.B.A. from a US University Dattatraya R. Puranik Has around 30 years of experience in the field of finance and accounting in India and abroad Has been the CFO of the Company since 2008 and Executive Director and CFO since 2012 • Holds a B.Com (Hons.), FICWA, ACMA (Australia) and MBA (Finance) • Executive Director & CFO • Presently a Partner with HSA Advocates, he has held leadership positions in various organizations in the past including CEO of Aditya Resources DMCC and a partner with J.Sagar & Associates . Has been associated with the company since 2006 Holds a Bachelor of Law from University of Mumbai and is a Solicitor from Bombay law society Abeezar E. Faizullabhoy Independent Director • Nirmal V. Momaya Non Executive Director Ajit S. Deshmukh Non Executive Director Over 25 years of experience in finance, taxation, audit and management consultancy • Founder of Pagoda Advisors, with a focus on consulting for various businesses like chemicals, healthcare, pharma, QSR, FMCG etc. • Holds a B.com and is a qualified Chartered Accountant • 20+ years of management and leadership experience in IT and investment banking; Has handled technology leadership positions at Citigroup and US Dept. of Defense 15+ years of experience as a successful entrepreneur in IT and financial services • Post Graduate from NCST and B.E. in Electronics from Mumbai University Atul R. Pradhan Independent Director Nicola A. Paglietti Independent Director • Management consultant with over 25 years of professional experience in consulting and across various industries • Founder of Transfolign Consulting LLP; Previously, Managing Partner of KPMG and founding Managing Director of Techsignia Solutions • Holds an MBA and a diploma in Electronics & Electrical Engineering Over 2 decades of professional experience, specializes in corporate, banking laws and is an expert in privatizations One of the founding partners of law firm Studio Internazionale, Rome Holds a Masters in Law and is a member of the Bar of New York and Rome 22 27 CFS Camlin Fine Sciences#30Product value chain Value chain of key products Hydroquinone Ascorbic Acid Phenol Catechol Ascorbyl Palmitate TBHQ BHA MEHQ Other derivatives of HQ Veratrole Guethol Guaiacol Other derivatives of Catechol Blends 28 Ethyl Vanillin Vanillin CFS Camlin Fine Sciences#31Profit & Loss Snapshot (consolidated) Particulars (INRmn) Net Revenue from operations Sales growth % Less: Expenses FY12A FY13A FY14A FY15A FY16A 3,352 3,736 5,087 5,583 4,893 11.5% 36.1% 9.8% (12.3%) Cost of Materials Consumed 1,675 1,646 2,757 2,705 2,031 Employee Benefit Expenses 243 302 344 406 410 Other Expenses 1,141 1,318 1,369 1,630 1,534 Profit from Operations before Other Income, Dep. Interest & Exceptional Item 293 470 616 842 918 Add: Other Income (Expenses) 116 102 97 84 43 EBITDA 409 572 713 925 961 EBITDA Margin % 12.0% 14.9% 13.8% 16.2% 19.1% Less: Depreciation and amortization expenses 135 136 118 162 171 Operating Profit (EBIT) before exceptional items 274 436 595 763 790 Finance costs 167 201 247 238 244 Profit Before Taxes before exceptional items 107 235 349 525 546 Less: Exceptional Items (1) (4) 451 Profit from Ordinary Activities before tax 108 235 349 528 500 Less: Income Tax Expense 69 84 61 (22) 142 Net Profit for the period Profit & Loss from Associates 39 151 287 550 358 (1) (0) (0) (0) (0) Net Income After Minorities 38 151 287 550 358 1 During the FY16 there is a charge for INR45.47mn due to short receipt of insurance claim relating to a fire which occurred during FY14 29 CFS Camlin Fine Sciences#32Balance Sheet (consolidated) Particulars (INRmn) Net Worth Debt Long Term Debt FY12A FY13A FY14A FY15A FY16A 529 654 933 1,349 1,762 Short Term Debt Other Long Term Liabilities 330 377 285 281 214 885 795 1,040 1,210 1,457 33 31 (40) 52 51 Current liabilities Accounts Payable 872 1,575 1,000 1,066 953 Other Current Liabilities (including current maturities of LT Debt) 206 263 428 340 389 Total Liabilities and Equity 2,856 3,695 3,647 4,297 4,827 Net Fixed Assets 761 840 1,052 1,092 1,653 Other Long Term Assets 26 22 27 217 176 Current Assets Inventory 844 1,490 1,092 1,364 1,733 Accounts Receivable 902 871 1,013 1,134 755 Loans and Advances and Other Current Assets 222 214 304 296 320 Cash and Cash Equivalents 102 257 158 193 189 Total Application of Funds 2,856 3,695 3,647 4,297 4,827 30 CFS Camlin Fine Sciences#33Glossary of terms Terms used HQ TBHQ BHA ODEB MEHQ ASP ONCB BHT PC US$ INR mn/ Mn CAGR FY CY MTPA Diphenols Inference Hydroquinone Tertiary Butyl Hydroquinone Butylated Hydroxyanisole Ortho Diethoxy Benzene Hydroquinone Mono Methyl Ether Ascorbyl Palmitate Ortho Nitro Chloro Benzene Butylated Hydroxy Toluene Performance Chemicals US Dollar Indian Rupee Million Compounded Annual Growth Rate 12 months ending March 31 of the mentioned year 12 months ending December 31 of the mentioned year Metric Tonnes Per Annum HQ and Catechol 31 CFS Camlin Fine Sciences#34Thank you 32