K+S Aktiengesellschaft Baader Helvea Virtual Roadsho · Baader Helvea Virtual Roadshow Alexander Enge IR Manager Julia Bock, CFA Senior IR Manager 16 April 2020. 2 K+S at a Glance

K+S Aktiengesellschaft

Baader Helvea Virtual Roadshow

Alexander Enge

IR Manager

Julia Bock, CFA

Senior IR Manager

16 April 2020

2

K+S at a GlanceGroup financials 2019

Revenues

€ 4.07 billion

EBITDA

€ 640 million

EBITDA-Margin

16%

Earnings after taxes, adj.

€ 78 million

Customer Segments

Revenues

€ 1.15 billion

EBITDA

€ 218 million

Margin 19%

Revenues

€ 0.48 billion

EBITDA

€ 60 million

Margin 12%

Revenues

€ 0.72 billion

EBITDA

€ 94 million

Margin 13%

OU Europe+: Revenues: € 2.54 billion; EBITDA: € 437 million; Margin: 17%

OU Americas: € 1.53 billion; EBITDA: € 230 million; Margin: 15%

Revenues

€ 1.72 billion

EBITDA

€ 295 million

Margin 17%

ConsumersIndustryAgriculture Communities

42%

46%

28%

34%

12%

9%

18%

15%

Baader Helvea Virtual Roadshow16.04.2020

606640

-206

140

Slight increase of revenues and EBITDA in 2019

despite adverse conditions

3

REVENUES- in € million -

4,039

4,071

2018 2019

+1%

DIVIDEND- in € -

0.250.15

2018 2019*

Payout ratio

37%56%

*Proposal

▪ EBITDA

improved

again in the

third year in

a row

▪ Synergies

contributed

more than €

100 million

Baader Helvea Virtual Roadshow

640

2018 2019

+6%

606

EBITDA- in € million -

+346

FCF- in € million -

2018 2019

16.04.2020

With our products, we ensure system-

relevant basic services.

• High-purity pharmaceutical salts for medicine and use in dialysis and

infusions

• Potassium salts for the production of a wide range of medical products

• Salts for the manufacture of disinfectant materials, soaps and

hypolyes

• Table salt for food production

• Salts for animal feed and animal nutrition

• Potassium fertilizer for agricultural food production

• Disposal services in the field of underground reutilization and

disposal

Social contribution

44 16.04.2020 Baader Helvea Virtual Roadshow

Our locations are our backbone: production

and supply chains are stable.

• Corona prevention teams established

• Shift times shortened and staggered

• Number of shift dialogues reduced

• Use of respiratory masks during work steps with a short

distance (e.g. to go down the mine shaft in the shaft elevator)

• Use of gloves on machines and vehicles

• Additional disinfection dispenser set up

• Instructions for behavior sent to 3,000 suppliers

• External truck drivers only leave the vehicle for load

securing

Securing production


Baader Helvea Virtual Roadshow6

Currently sufficient liquidity situation

• Short-term access to financial markets

difficult due to Corona

• Sufficient leeway in our credit line agreed

with banks

• Examination of government support

programs to further secure short-term

liquidity

• The next major financing instruments are

due in May 2021


▪ Complete sale of OU Americas

▪ Comprehensive realignment and

restructuring of K+S

▪ Noticeable cost reduction

▪ Advanced efficiency and productivity

measures

▪ Future-oriented solutions in the

environmental sector

▪ Sustainable positive free cash flow

contribution from all sites

Baader Helvea Virtual Roadshow7

➢ The new K+S: lean and performance-

oriented with a solid financial base

New focus


• Broad portfolio of interested parties

• Initial talks held

• Investment banks mandated

• Signing expected in 2020

• Sale process is proceeding according to plan even

under current conditions with regards to Covid-19

• Uninterrupted interest from potential buyers

• Present framework conditions are no obstacle for

the current phase of the process

Complete Sale OU Americas on schedule

8

1• Leading brands with high

emotional customer loyalty

• Established customer-

oriented network with 28

locations in North America

and cost-effective production

in South America

• Revenues: EUR 1.5 billion

(2019)

• EBITDA: EUR 230 million

(2019)

• Stable cash flows

1

SANTIAGO DE

CHILE

POINTE-CLAIRE

CHICAGO

Unique position in the salt market


• Bethune is an integral part of the company's

future asset sale currently not planned

• Restructuring of administrative functions

• Focus on the core business by selling non-core

activities (e.g. Sale of Baltic Train or K+S

Entsorgung Schweiz)

• Future-oriented solutions in the environmental

sector

• Capital expenditure under review

• Sustained positive free cash flows at all German

production sites

Restructuring and crystallizing values

9 Baader Helvea Virtual Roadshow16.04.2020

Restructuring

OU Europe+ measures

K+S: Focus remains on strengthening the balance sheet

10

Dec. 2019: Net financial liabilities: EUR 3.1 billion Net financial liabilities/EBITDA: 4.9x

End of 2021

• Reduction of net financial liabilities by significantly more than € 2 billion

• Stable cross over rating targeted

Sale of OU Americas


Current market assessment

11 Baader Virtual Roadshow16.04.2020

• Agriculture and the food industry as a

system-relevant infrastructure is little affected

worldwide by Covid-19

• Sowing period in the Northern Hemisphere

has just started

• Ideal weather conditions and good farmer

economics in relevant agricultural markets

• Expected new China contract should also

stimulate demand there

Good demand in Customer Segments Agriculture


13

200

250

300

350

400

450

500

200

225

250

275

300

325

350

375

400

MOP gran. Brazil USD/t, cfr (left scale)

MOP gran. Europe EUR/t, cfr (right scale)

Quelle: FMB Argus Potash

USD/t EUR/t

SOP Europe EUR/t, cfr (right scale)

Potassium

Sulfate

(SOP)

Europe

Potassium

Chloride

(MOP) Brazil Potassium

Chloride

(MOP) Europe

▪ Our unique German deposits enable a broad product portfolio in the customer segment agriculture

▪ Higher value specialty products (SOP) significantly more stable than potassium chloride

▪ Domestic market Europe significantly more stable

▪ MOP prices bottoming out

Customer Segment Agriculture

Stable speciality business and regional diversification pay off



Between plan and Reality: Potash projects announced since 2006 (Greenfield)

160 6

Announced projects or in early

development phases

Projects with a high

probability of

implementation by

2025

2

Projects in ramp-up

phase


thousand tons

0

20.000

40.000

60.000

80.000

100.000

120.000

140.000

'05 '10 '15 '20v '25v

Greenfield potash newcomersrevised forecast

technical available capacity from 2015

Source: IFA, K+S; including potassium sulfate and potash varieties with a lower K2O content of about 5 million tonnes eff.

RevenueTechnical available capacity of

existing producers

+/-0% (Scenario 1)

+1.3% (IFA prognosis)

+3% (Scenario 2)

▪ Only 5 years ago, the technically

available capacity in 2025 was

estimated to be 12 million tons higher

than today

▪ Even now, greenfield projects by potash

newcomers will still account for a

significant share of the total until 2025

▪ Non-utilization of capacity by existing

producers not taken into account

▪ Global capacity load should level off at

the long-term average by 2025

15


What is behind the greatly feared oversupply?


Potassium chloride

57

Fertilizer specialities

47

1 Specialities

2 Commodities

Customer Segment Agriculture at a Glance

Characteristics

1 2

Revenue Split by Products 2019 (%)Revenue Split by Region 2019 (%)

Europe

50

thereof Germany

12

South

America

22

Asia

19

Others

5

▪ Close proximity to our main customers provide logistical

advantages

▪ Shipments to overseas customers at competitive costs

from Hamburg harbor

▪ Strong and long-standing customer relationships

▪ Broad specialty portfolio provides flexibility and stability,

partly following different trends and seasons

North America

4

16 Baader Helvea Virtual Roadshow

in € million FY/18 FY/19

Revenues 1,741.3 1,715.6

Sales volume (mt) 6.85 6.30

EBITDA 274.5 294.9

Key financials

16.04.2020

Growth drivers

Oil and Gas

1

Water Softening

4

Revenue Split by Products 2018 (%)

Complementary

15

Other

24

Animal Nutrition

7

Chemical

23

Food

21

Pharma

5


Revenues 1,132.8 1,148.0


EBITDA 225.5 218.0

Population growth

Economic growth and industrialization

Increasing standard of living

Urbanization

Current trading

▪ Weaker demand due to Covid-19 in

some industries mitigated by

diversified product portfolio

▪ Strong demand by food industry

Key financials

Customer Segment Industry at a Glance


Growth drivers

Ice Melt

7


Other

1

Water and Pool

53

Culinary

39


Revenues 453.7 484.7


EBITDA 43.3 59.7

Population growth

Economic growth

and industrialization

Increasing standard

of living

Current trading

▪ Consumers customer segment showed first success in

2019 to pass on higher costs, especially for logistics

▪ Good progress in the rollout of the German premium table

salt brand Saldoro® to retail sellers and gastronomy

▪ Stable demand situation also in times of Covid-19

Key financials

Customer Segment Consumer at a Glance


Customer Segment Communities at a Glance

Revenue Split by Region 2019 (%)

thereof

Germany

9

Europe

18

North America

821 Commodities

Current trading

▪ Owing to the generally very poor start in the

de-icing salt business for weather-related reasons in

Europe and North America, we

expect sales volumes between 8 and 9 million tonnes

for the 2020 financial year (normal year: between

12.5 and 13.0 million tonnes; 2018:

12.7 million tonnes).


De-icing packaged

2

De-icing bulk

98

1

19 Baader Helvea Virtual Roadshow


Revenues 708.4 719.9


EBITDA 121.8 94.4

Key financials

16.04.2020

Outlook 2020¹

20

Sales volumes:

Agriculture: >7mt

Communities: ~8-9mt€640m

€620m

€560m

€500m

• ASP Agriculture on the level of Q4/2019 (255 €)

• Below average de-icing salt business in EU

• Below average de-icing salt business in NA

• ASP Agriculture slightly below Q4/2019 (255 €)

• Below average de-icing salt business in EU

• Weaker de-icing salt business in NA than upper case

• ASP Agriculture even more below Q4/2019 (255 €)

• Weaker de-icing salt business in EU than midpoint

• Weaker de-icing salt business in NA than midpoint

Upper case

Midpoint

Lower case

EBITDA

2020e

• Stable earnings for Industry and Consumer segment expected

• Positive Shaping effects should slightly overcompensate for cost inflation

• We expect free cash flow to break more or less even at the midpoint of the EBITDA range

EBITDA

2019

Main assumptions

¹Impacts from Corona virus not predictable; no effects from restructuring or sale of OU Americas includedBaader Helvea Virtual Roadshow16.04.2020

IR Contact Details

e-mail: [email protected]

homepage: www.kpluss.com

IR-website: www.kpluss.com/ir

K+S Aktiengesellschaft

Bertha-von-Suttner-Str. 7

34131 Kassel (Germany)

Janina Rochell

Investor Relations Manager

Phone: +49 561 / 9301-1403

Fax: +49 561 / 9301-2425

[email protected]

Christiane Martel

Roadshow Management

Phone: +49 561 / 9301-1100

Fax: +49 561 / 9301-2425

[email protected]

Alexander Enge

Investor Relations Manager

Phone: +49 561 / 9301-1885

Fax: +49 561 / 9301-2425

[email protected]

Julia Bock, CFA

Senior Investor Relations Manager

Phone: +49 561 / 9301-1009

Fax: +49 561 / 9301-2425

[email protected]

Dirk Neumann

Head of Investor Relations

Phone: +49 561 / 9301-1460

Fax: +49 561 / 9301-2425

[email protected]


https://www.kpluss.com/de-de/

https://www.kpluss.com/de-de/investor-relations/

Housekeeping Items / Financial Calendar

▪ Tax rate: ~30%

▪ Financial result: ~€-130

▪ CapEx: Significantly up

▪ D&A: ~€450m

▪ Reconciliation (EBITDA): €-60m to €-80m

Additional information on Outlook FY 2020

Financial Calendar

▪ Customer segment Agriculture:

Sales volume: >7.0mt (2019: 6.3mt)

▪ Customer segment Communities:

Sales volume: ~8-9mt (2019: 12.7mt)

Q1 2020 Earnings Release 11 May 2020

Virtual Annual General Meeting tba

Dividend payment tba

Half-yearly Financial Report 2020 13 August 2020


Appendix


24

Avoided shutdowns caused by

wastewater

Increased product quality in

Bethune

Most important work done

in 2019

Generated significant positive

free cash flow

Leveraged synergies of

EUR >100 million

16.04.2020 Baader Helvea Virtual Roadshow

25

Sluggish demand for potassium

chloride overseas

Production cutbacks in the entire

potash industry

Winter below expectations

Deterioration of conditions in

the second half of 2019

16.04.2020 Baader Helvea Virtual Roadshow

▪ Q4/19 EBITDA down to € 160m (2018: € 228m)

▪ FCF plus € 83m from € -147m to € -64m in 2019

▪ NFD/EBITDA with 4.9x improved (31/12/18: 5.3x)

▪ Dividend proposal 0.15ct per share

Q4 and FY/2019 at a glance

26

228

160

-18

-122

+67

2018 Price Volume/Mix

FX/Others 2019

EBITDA in €m

−Production

cuts

Agriculture

−De-icing

volumes

FinancialsHighlights

+Mainly

pricing

Agriculture

+Deconsolidation

K+S Real Estate

+Sale Baltic Train

+IFRS 16

+Synergies

+FX

€ million Q4/18 Q4/19 % FY/18 FY/19 %

Revenues 1,217 1,024 -16 4,039 4,071 +1

t/o Europe+ 783 626 -20 2,585 2,536 -2

t/o Americas 433 491 +13 1,451 1,532 +6

D&A 103 103 -14 379 432 +14

EBITDA 228 160 -30 606 640 +6

t/o Europe+ 166 64 -61 443 437 -1

t/o Americas 75 83 +11 230 230 −

Adj. net profit 72 9 − 85 78 -8

Adj. EPS (€) 0,38 0,05 − 0,45 0.41 -9

Operating cash flow 33 130 − 309 640 −

Adj. FCF -147 -64 − -206 140 −

CapEx 165 183 +11 443 493 +11

NFD/EBITDA (LTM) − − − 5,3x 4,9x −


▪ Construction of the new Bethune potash plant from 2011 to 2017

▪ Around EUR 1 billion environmental investment over the last 8 years

▪ 2019: High capex discipline and improved working capital management lead to clearly positive free cash flow

27

(Mio. EUR)

743

1.1531.279

1.171

811

443496

49

-306

-636-777

-390

-206

140

2013 2014 2015 2016 2017 2018 2019

Investments Adjusted FCF

Promise of positive free cash flow from October 2017 fulfilled!

Clearly positive free cash flow generated


Site costs (FOB) in comparison (2020)

* column width = production capability in million tonnesSource: CRU Report 2016, K+S

-30%

BU Potashw/o Bethune

(incl. Specialties)

Best-in-class

USD/t

K+S Bethune(after 2023)

K+S Zielitz(Purely MOP)

K+S Bethune*

The Bethune ramp-up to 2.86 million tons in the mid 2020s (production capability) significantly improves K+S's competitive position.


Disclaimer

29

No reliance may be placed for any purpose whatsoever on the information or opinions contained in the Presentation or on its completeness, accuracy of

fairness. No representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its respective directors, officers,

employees, agents or advisers as to the accuracy, completeness or fairness of the information or opinions contained in the Presentation and no

responsibility or liability is accepted by any of them for any such information or opinions. In particular, no representation or warranty, express or implied,

is given as to the achievement or reasonableness of, and no reliance should be placed on any projections, targets, ambitions, estimates or forecasts

contained in this Presentation and nothing in this Presentation is or should be relied on as a promise or representation as to the future.

This presentation contains facts and forecasts that relate to the future development of the K+S Group and its companies. The forecasts are estimates

that we have made on the basis of all the information available to us at this moment in time. Should the assumptions underlying these forecasts prove

not to be correct or should certain risks – such as those referred to in the Annual Report – materialize, actual developments and events may deviate

from current expectations. Given these risks, uncertainties and other factors, recipients of this document are cautioned not to place undue reliance on

these forecasts.

This Presentation is subject to change. In particular, certain financial results presented herein are unaudited, and may still be undergoing review by the

Company’s accountants. The Company may not notify you of changes and disclaims any obligation to update or revise any statements, in particular

forward-looking statements, to reflect future events or developments, save for the making of such disclosures as are required by the provisions of statue.

Thus statements contained in this Presentation should not be unduly relied upon and past events or performance should not be taken as a guarantee or

indication of future events or performance.

This presentation has been prepared for information purposes only. It does not constitute an offer, an invitation or a recommendation to purchase or sell

securities issued by K+S Aktiengesellschaft or any company of the K+S Group in any jurisdiction.


Documents

K+S Aktiengesellschaft Baader Helvea Virtual Roadsho · Baader Helvea Virtual Roadshow Alexander Enge IR Manager Julia Bock, CFA Senior IR Manager 16 April 2020. 2 K+S at a Glance