Q4 2021 Icl Group Ltd Earnings Call

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Ladies and gentlemen, thank you for funding by end buyer come to the ICL Analyst Conference call.

Ladies and gentlemen, thank you for standing by and welcome to the ICL analysts conference call.

Our presentation today will be followed by a question and answer session, at which time, if you wish to ask a question, you will need to press star and one on your telephone.

Our presentation today it would be followed by a question and answer session at which time. If you wish to ask a question you would need to press star and one on your telephone.

I must advise you that this call is being recorded today. If you experience any technical difficulties, please press star zero on your telephone.

Must advice you that this call is being recorded today.

If you experience any technical difficulties. Please press star zero on your telephone.

I'd like to hand the call over to your first speaker today, Peggy Wylie-Sarp, Vice President of Global Investor Relations. Please go ahead, Mom.

I'd like to hand, the call over to your first speaker today, Peggy Reilly Tharp, Vice President of Global Investor Relations. Please go ahead maam.

Thank you Hello, everyone I'm, Peggy Reilly Tharp, Vice President of Global Investor Relations I'd like to welcome you and thank you for joining us today for our quarterly earnings call. The event is being webcast live on our website at ICL Dash group Dotcom.

Thank you. Hello everyone. I'm Peggy Riley Tharp, Vice President of Global Investor Relations. I'd like to welcome you and thank you for joining us today for our quarterly earnings call. The event is being webcast live on our website at icl-group.com.

Earlier today, we filed our reports with the securities authorities and the stock exchanges in the US and in Israel. Those reports, as well as the press release, are available on our website.

Earlier today, we filed our reports with the securities authorities and the stock exchanges in the U S and in Israel those reports as well as the press release are available on our website.

There will be a replay of the webcast available after the meeting and a transcript will be available shortly thereafter the.

There will be a replay of the webcast available after the meeting and a transcript will be available shortly thereafter. The presentation, which we'll be reviewed today, was also filed with the securities authorities and is available on our website. Please be sure to review the disclaimer on slide two. Our comments today will contain forward-looking statements within the meaning of the Private Security's litigation reform act of 1995.

The presentation, which will be reviewed today was also filed with the securities authorities and is available on our website. Please be sure to review the disclaimer on slide two our comments today will contain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995. These.

These statements are based on management's current expectations and are not guaranteed future performance. The company undertakes no obligation to update any financial information discussed on this call at any time.

These statements are based on management's current expectations and are not guarantees of future performance. The company undertakes no obligation to update any financial information discussed on this call at any time.

We will begin with the presentation by our CEO , Mr. Rive Zolder, followed by Mr. Aviyar Amlahav, RCFO. Following the presentation, we will open the line for the Q&A session. Ravi, please.

We will begin with a presentation by our CEO . Mr. Zoller, followed by Mr. Avi out I'm gonna have our CFO .

Following the presentation, we will open the line for the Q&A session Raviv. Please.

Thank you Peggy and welcome everyone in the fourth quarter ICL delivered significant growth in both sales and EBITDA as we benefited from our continued strategic focus on growing our long term specialty solutions and from commodity upside momentum.

Thank you Peggy and welcome everyone. In the fourth quarter, ICL delivered significant growth in both sales and EBITDA as we benefited from our continued strategic focus on growing our long-term specialty solutions and from commodity upside momentum.

In fact, all three of our specialty businesses delivered all-time record fourth quarter and annual...

In fact, all three of our specialty businesses delivered all time record fourth quarter and annual results.

Fourth quarter sales came in at more than $2 billion up more than 50%, while adjusted EBITDA was $575 million increased by more than 100% and was an all time fourth quarter record.

Fourth quarter sales came in at more than $2 billion, up more than 50%, while adjusted EBITDA of $575 million increased by more than 100% and was an all-time fourth quarter...

This was a remarkable entered 2021 and for the full year, we delivered $7 billion in sales, our second highest ever as well as $1 $6 billion of adjusted EBITDA.

This was a remarkable end to 2021, and for the full year, we delivered $7 billion of sales, our second highest ever, as well as $1.6 billion of adjusted EBITDA. As you know, the f***.

As you know the fourth quarter is traditionally one of our slower quarters. However, as you can see on slide three we delivered our fifth consecutive quarter of bottom line improvement.

However, as you can see on slide three, we delivered our fifth consecutive quarter of bottom line.

All four of our businesses contributed with double digit growth in sales and EBITDA and this includes innovative AG solutions, which delivered on both an organic basis and via our recent Brazilian acquisition.

All four of our businesses contributed with double digit growth in sales in EBITDA, and this includes innovative ag solutions which delivered on both an organic basis and via our recent Brazilian ex...

Performance in the quarter was supported by increased demand and higher prices in most markets, which helped us deliver record free cash flow of $166 million in the fourth quarter.

Performance in the quarter was supported by increased demand and higher prices in most markets, which helped us deliver record free cash flow of 166 million dollars in the fourth quarter, a nine year record and free cash flow of 465 million dollars for 2020.

A nine year record and free cash flow of $465 million for 2020 one.

For the fourth quarter, we also delivered a dividend distribution of $13 18 per share up more than 10 cents per share over the fourth quarter of last year.

For the fourth quarter, we also delivered a dividend distribution of 13.18 cents per share, up more than 10 cents per share over the fourth quarter of last year.

While we saw continued success in the quarter, we also faced many of the same challenges we had throughout...

While we saw continued success in the quarter. We also faced many of the same challenges we had throughout 2021.

Once again, the teams work tirelessly to overcome higher overall costs and global supply chain challenges.

Once again, the teams worked tirelessly to overcome higher overall costs and global supply chain challenges.

Most importantly, the global relationships, our supply chain procurement and logistics teams have built over the years served us well during the past 18 months.

Most importantly, the global relationships our supply chain, procurement, and logistics teams have built over the years served us well during the past eight years.

seems recognized in balances and prices and supplies well in advance and work to ensure consistent quality and quantity of supplies.

That seems recognized imbalances in prices and suppliers well in advance and work to ensure consistent quality and quantity of supply.

They strengthened partnerships across the supply chain manage through the tough times and helps keep ICL on track almost seamlessly for the benefit of our extensive global customer base.

They strengthen partnerships across the supply chain, manage through the tough times, and help keep ICL on track almost seamlessly for the benefit of our extensive global customer...

Now please turn to slide four for a snapshot of our fourth quarter results.

Now please turn to slide four for a snapshot of our fourth quarter results.

As you can see once again, we demonstrated improvement in each key financial parameters.

As you can see, once again, we demonstrate an improvement in each key financial parameter.

On slide five, you can see year over year sales were up more than 50%, while adjusted EBITDA was up more than 100%, and margin increased by more than 780 basis points. Alex 2 Richard

On slide five you can see year over year sales were up more than 50%, while adjusted EBITDA was up more than 100% and margin increased by more than 780 basis points.

We also added nearly $90 million of operating cash flow.

I would now like to begin our segment review with industrial products on slide six.

I would now like to begin our segment review with industrial products on slide.

Quarterly sales were a record $422 million, while EBITDA was $129 million and both were up approximately 25% year over year.

Quarterly sales were a record $422 million, while EBITDA was $129 million, and both were up approximately 25% year-over.

This business benefited from strong product demand across key regions and from continued strategic shift to long term contracts.

This business benefited from strong product demand across key regions and from continued strategic shifts to long term...

Our customers place a premium on knowing they will consistently receive the quality and quantity of product they need to meet their requirements. And this is across all of our...

Our customers place a premium on knowing they will consistently received the quality and quantity of product they need to meet their requirements and this is across all of our end markets.

The electronics market remained under supplied in the construction industry also remained very healthy in the quarter as the market took advantage of unseasonal weather, which has since turned.

The electronics market remained under supplied and the construction industry also remained very healthy in the quarter, as the market took advantage of unseasonal weather which is since...

Clearbriar fluid sales returned to more normalized pre-COVID levels in the fourth quarter as higher oil prices were made

Clear brine fluid sales returned to more normalized pre COVID-19 levels in the fourth quarter as higher oil prices were maintained.

We also saw significant contribution from our phosphorous based flame retardants and our specialty minerals businesses as the latter benefited from the higher demand from the supplements, pharmaceutical, de-icing, and oil drilling industries.

We also saw significant contribution from our phosphorus based flame retardants and our specialty minerals businesses as the latter benefited from the higher demand from the supplement pharmaceutical dicing in oil drilling end markets.

Our ongoing capacity expansions remain on track and are expected to be operational in the second half of 2022.

Our ongoing capacity expansions remain on track and are expected to be operational in the second half of 2021.

In addition, Industrial Products is about to launch a growth acceleration investment

In addition, industrial product is about to launch a growth acceleration investment plan, which is expected to expand capacity and deliver additional improvements in sales and profit.

which is expected to expand capacity and deliver additional improvements in sales and process.

We will provide more details on this initiative when we update you on our progress toward achieving 2025 targets later this

We will provide more details on this initiative when we update you on our progress towards achieving 2025 targets later this year.

For fiscal 2020 , one industrial products delivered record sales and profit for the division with significant contribution from its bromine and phosphorus based flame retardants as well as from its specialty minerals products, allowing us to achieve record cash flow for this business in 2021.

For fiscal 2021, industrial products delivered record sales and profit for the division.

significant contribution from its bromine and phosphorus-based lane regard as well as from its specialty minerals products, allowing us to achieve record cash flow for this business.

Turning to slide seven and our potash business, where sales of $698 million were up with an 80% year over year, and EBITDAV $288 million was up nearly $200.

Turning to slide seven in our potash business, where sales of $698 million were up more than 80% year over year and EBITDA of $288 million was up nearly 250%.

For the quarter, our average realized price per ton of $487 was up nearly 115% year over year, driven by strong global crop demand and allocation optimization.

For the quarter, our average realized price per ton of $487 was up nearly 115% year over year driven by strong global crop demand and allocation optimizations.

Corn, soybean, wheat, and rice prices were all up double digits year over year. Have supply remained tight and countries remained concerned about...

Corn, soybean wheat, and rice prices were all up double digits year over year as supply remained tight and countries remained concerned about food security.

For our Plattash production sites, work was completed on our P9 pumping station in the Dead Sea during the fourth quarter. And operations commenced early this...

For our potash production sites work was completed on our P. Nine pumping station in the dead Sea during the fourth quarter and operations commenced early this year.

And both of the dead Sea and in Spain, we maximize our granular potash production through Debottlenecking efforts, which resulted in higher realized prices the shift not only men granular comprised approximately 50% of our production, but it also added roughly $35 million to operating income in 2020 one.

In both the Dead Sea and in Spain, we maximized our granular potash production through debodal necking efforts which resulted in higher realized

The shift not only meant granular comprise approximately 50% of our production, but it also added roughly $35 million to operating income.

At ICL Boobie, we saw an increase in both polysulfide production and sales volume in the fourth quarter up 36% and 42% respectively. During the quarter. We also announced the approval of both of these applications to continue mining and production through 2048.

At ICL Bulby, we saw an increase in both polysulfate production and sales volume in the fourth quarter. Up 36% and 42% respect.

During the quarter, we also announced the approval of Bobi's application to continue mining and production through 2048.

Beginning in 2022 are will be operations will be moving from the potash segment to our innovative AG solutions segment and this change will better align boobies specialty products as we continue to focus on targeting long term growth through specialty solutions.

Beginning in 2022, our bullby operations will be moving from the putash segment to our innovative ad solution segment, and this change will better align bullby specialty products as we continue to focus on targeting long-term growth through specialty

Turning to slide eight and our phosphate solutions Division, where reported fourth quarter sales of $609 million were up more than 20% year over year, while EBITDA of $146 million was up nearly 100%.

Turning to slide 8 and our phosphate solutions division, where reported fourth-porter sales of $609 million or up more than 20% year over year, while EBITDA of $146 million was up nearly $100.

Of note December traditionally one of our slower months was our strongest for 2020 , one as we were able to supply new and existing customers at higher market prices.

Of note, December , traditionally one of our slower months was our strongest for 2021 as we were able to apply new and existing customers at higher

Phosphate specialties delivered record quarterly sales and profit as both food and industrial sales increased with higher demand across all regions.

The Flawfate Specialties delivered record quarterly sales and profit as both food and industrial sales increased with higher demand across all

Also, as we mentioned last quarter, we inaugurated our new alternative protein plant in St. Louis and...

Also as we mentioned last quarter, we inaugurated our new alternative protein plant in St. Louis in December .

Our food specialty business saw a mixed impact from the resurgence of COVID with food service weakening as it had during COVID-19.

Our food specialties business saw a mixed impact from the resurgence of Covid.

With foodservice weakening as it had during Covid peaks.

However, retail was able to offset this decline one-

Ever retail was able to offset this decline once again.

Industrial customers also provided strong demand in this business saw continued improvement in volumes across all end markets at higher prices in the quarter.

Industry of customers also provided strong demand and this business saw continued improvement in volumes across all end markets at higher price

Our YPA subsidiary, Kaptos Record 2021 Sales and Profit, was a great fourth quarter, driven by higher volumes and prices, as well as improved

Our ypa's subsidiary capped off record 2021 sales and profit with a great fourth quarter, driven by higher volumes and prices as well as improved efficiency.

This business also continued to supply increasing demand from the lithium iron phosphate battery market with drove higher specialty mono ammonium phosphates sales.

This business also continues to supply increasing demand from the Lithium Iron Fossil battery market, which drove higher specialty monomonium fossil.

Overall, we saw significant increase in phosphate fertilizer sales and profitability driven by record production and continued health

Overall, we saw a significant increase in phosphate fertilizer sales and profitability driven by record production and continued healthy demand.

throughout the quarter, supply remained tight due to export restrictions in China and Russia and other shifting global-

Throughout the quarter supply remains tight due to export restrictions in China, and Russia, and other shifting global dynamics.

Just before the end of the year, we announced the extension of our phosphate mining concession and wrote them, which has been approved for an additional three years through the end of 2024.

Just before the end of the year, we announced the extension of our phosphate mining concession in Rotem, which has been approved for an additional three years through the end of 2020.

For fiscal 2021 our phosphate specialties business delivered record sales and profit and also reported production record spanning multiple sites across three continents as the team works to meet higher new and existing global customer demand.

for Fiscal 2021, our Fossilite Specialty's business delivered record sales and profit, and also reported production records spending multiple sites across three continents. As the team worked to meet higher new and existing global customer

This business saw strong volume increases in higher prices across food and industrial specialty phosphates and for specialty acids.

This business saw strong volume increases and higher prices across food and industrial specialty phosphates and for specialty assets.

Turning to slide nine and innovative AG solutions.

In total, fourth quarter innovative ag sales of $380 million or up more than 130% while EBITDA 48 million was up more than 330.

In total fourth quarter innovative AG sales of $380 million were up more than 130%, while EBITDA of $48 million was up more than 330%.

This segment saw record organic growth. In addition to outstanding performance from both of our recent Brazilian acquisitions.

This legman saw record organic growth in addition to outstanding performance from both of our recent Brazilian apps.

For the quarter organic sales and EBITDA were up 37% and 82% respectively.

for the quarter organic sales in EBIDO were up 37% and 82% risk.

Positive momentum continued across I S due to strong demand and higher volumes across most regions and product lines.

Positive momentum continued across IAS due to strong demand in higher volumes across most regions and products.

Our turf and ornamental business saw robust growth as this business benefited from a global increase in sales volumes and higher prices as distributors stocked up in advance of the spring gardening season in the northern hemisphere.

Our turf and ornamental business, Sarobus Gross, has this business benefited from a global increase in sales volumes in higher prices, as distributors stocked up in advance of the spring gardening season in the North Minimum.

Specialty fertilizer sales reached record levels for both the fourth quarter and full year with increases across all regions led by higher volumes of straights liquid and controlled release fertilizers and strong performance in Brazil.

Specialty fertilizer sales reached record levels for both the fourth quarter and full year, with increases across all regions led by higher volumes of Straits, liquid and controlled release fertilizers, and strong performance in bris...

For overall 2021, our Innovative Ag Solutions of Business reported record, organic, and total sales and profits.

For overall 2021 our innovative AG solutions business reported record organic and total sales and profit.

Now if you'll turn to slide 10, I would like to walk you through some of our recent impactful events before turning the call over to Ron for a review of our financials.

Now, if you will turn to slide 10, I would like to walk you through some of our recent impactful events before turning the call over to Aviram for a review of our finance.

Throughout the year, we've targeted innovation, sustainability, and service excellence through valuable partnerships. And we expect this to continue into 2022.

Throughout the year, we've targeted innovation sustainability and service excellence through valuable partnerships and we expect this to continue into 2022.

You've heard me discuss our internal innovation efforts and in 'twenty 'twenty. One these efforts delivered approximately $40 million in annual efficiencies.

And in 2021, these efforts delivered approximately $40 million in annual efficient.

In addition, our internal accelerated continued to deliver and achieve a run rate of more than $100 million of additional annual operating income.

In addition, our internal accelerator continued to deliver and achieve a run rate of more than $100 million of additional annual up.

This program succeeds by challenging employees to be creative and innovative in finding all types of solutions from the everyday to the next big product. Our employees

This program succeeds by challenging I'm pleased to be creative and innovative in finding all types of solutions from the every day to the next big product.

Our employees have really made a difference.

Well America to so it's still very new to ICL, they're already blazing a trail when it comes to innovation.

While America the soul is still very niche ICO, they're already blazing a trail when it comes to innovation.

The team in Brazil was ranked as one of them five most innovative agribusiness companies in the country by business newspaper Velour economical as part of its annual Velour Innovation Awards.

Team in Brazil is ranked as one of the five most innovative agribusiness companies in the country by the business newspaper Valor Economical as part of its annual Valor Innovation Award.

We're proud of their efforts, especially since innovation is such an integral part of our identity and our...

We're proud of their efforts, especially since innovation is such an integral part of our identity and our future growth.

At ICL, innovation is happening every day. It's part of our DNA, and I would be remiss if I did not point out to other 2021

At ICL innovation is happening every day, it's part of our DNA and.

And that would be remiss, if I did not point out two other 2021 efforts.

First, our expansion into the electric vehicle and energy storage space through our production of special TMAP for the LFP battery market.

First our expansion into the electric vehicle and energy storage space through our production of specialty M. A pea for the L. S. P battery market.

Second, the launch of our ICO Planet Startup Sterinal Innovation.

Second the launch of our ICL planet startup external innovation hub.

I mentioned sustainability a great deal in the past couple of years and you'll be hearing more of the same in 2022 as we are beginning our year of sustainability within.

I mentioned sustainability, a great deal in the past couple of years and you'll be hearing more of the same in 2022 as we are beginning our year of sustainability with the ico.

I'm looking forward to what is to come this year and would like to mention a few fourth quarter mile.

I'm looking forward to what is to come this year and we'd like to mention a few fourth quarter milestones.

At the end of this year, we launched what we are calling our Greenstone project.

At the end of this year, we launched what we're calling our greenstone project.

This is an innovative effort designed to leverage renewable energy for our largest production site.

This is an innovative effort designed to leverage renewable energy for our largest production site. It will help us reach our goal of being...

It will help us reach our goal of being carbon neutral by 2050, and we will be sharing more about this exciting initiative in the coming months.

and we will be sharing more about this exciting initiative in the coming

Also in the fourth quarter, we were awarded the prestigious gold medal rating by Echo Vegas for the first time.

Also in the fourth quarter, we were awarded the prestigious gold medal rating by Icovatus for the first time.

This means ICO is ranked in the top 5% out of 75,000 rated suppliers, and we are thrilled to be recognized as a global supplier that demonstrates the sustainability standards aligned with our...

This means ICL is ranked in the top 5% out of 75000 rated suppliers and we are thrilled to be recognized as a global supplier to demonstrate sustainability standards aligned with our customers.

As I discussed earlier, we opened our alternative protein plant in St. Louis in the fourth quarter, and this investment represented just one part of our efforts to develop healthier and more sustainable food products.

As I discussed earlier, we opened our alternative protein plants in St. Louis in the fourth quarter and this investment represent just one part of our efforts to develop healthier and more sustainable food products.

We're excited about the consumer trend toward more sustainable lifestyle and diet choices, and look forward to offering additional sustainable, functional, and nutritional alternative food solutions going...

We're excited about the consumer trend towards more sustainable lifestyle and diet choices and look forward to offering additional sustainable functional nutrition alternative food solutions going forward.

Yeah.

I would like to mention our commitment to developing and driving a more circular economy, which we're doing through new and innovative products like fiber outgrow advance.

I'd like to mention our commitment to developing and driving a more circular economy, which we are doing through new and innovative products like Fibagro Advanced.

This unique and superior pita alternative is made from a byproduct of the timber industry.

This unique and superior Pete alternative is made from a byproduct of the timber industries and allows a much lower carbon footprint compared with use of Pete and other Pete alternatives, a true sustainable step forward.

and allows a much lower carbon footprint compared with use of peat and other peat alternatives.

Like innovation, ESG is an integral part of our day-to-day work at ICO. And I would like to highlight two additional achievements in 2020.

Like innovation ESG is an integral part of our day to day work at ICL and I would like to highlight two additional achievements in 2020 one.

We set in place measurable environment targets through a sustainability linked loan and we established a new climate and sustainability Committee to help direct and guide our progress.

We set in place measurable environment targets through a sustainability link loan, and we established a new Climate and Sustainability Committee to help direct and guide our

In terms of partnership once again, the positive developments in Israel's foreign relations has opened up the opportunity for us to build new relationships and create new collaborations.

In terms of partnership, once again the positive developments in Israel's foreign relations have opened up the opportunity for us to build new relationships and create new collaboration.

As a result, for the first time, we shift Israeli clear-brined fluids to the United Arab Emirates, this path of the semi-

As a result for the first time, we shift is really clear brine fluids to the United Arab Emirates. This past December .

We welcome the opportunity to supply of product and are proud to be part of this historically significant moment.

We welcome the opportunity to supply our product and are proud to be part of this historically significant

Earlier this year, we announced a number of other partnerships, including our collaborative efforts with Columbia University's Electrochemical Energy Center to jointly explore strategies to address energy storage and conversion via next-generation battery.

Earlier this year, we announced a number of other partnerships, including our collaborative efforts with Columbia University's Electrochemical Energy center to jointly explore strategies to address energy storage and conversion via next generation batteries.

We're also teaming up with Plant Arc Bio, an Israeli Ag Bio company, and have filed a joint patent to develop a novel bio-stimulant technology platform for improving crop yields while having a mineral impact on the...

We're also teaming up with plant arc bio and Israeli add bio company and have filed a joint patent to develop a novel bio stimulant technology platform for improving crop yields while having a minimal impact on the environment.

If you will turn to slide 11, I would like to wrap up by reviewing some of the key takeaways from 20...

If you'll turn to slide 11, I would like to wrap up by reviewing some of the key takeaways from 2021 .

Our strategic long-term focus on specialty solutions, which continues as commodity-upflight persists, benefited us through the year, as we delivered all-time record profitability from all of our specialty businesses, with a year-over-year increase of more than 50%.

Our strategic long term focus on specialty solutions, which continues as commodity upside persists benefited us through the year as we delivered all time record profitability from all of our specialty businesses with a year over year increase of more than 50%.

In 2021, we benefited from some of the additional production capacity we continue to bring online in our industrial products and phosphate solutions.

In 2021 we benefited from some of the additional production capacity, we continue to bring online in our industrial products and phosphate solutions businesses.

The agriculture portion of our business was strengthened by our strategic acquisitions in Brazil, which provided additional sales profitability and a seasonal balance between the northern and southern hemispheres.

The agriculture portion of our business was strengthened by our strategic acquisitions in

which provided additional sales, profitability, and a seasonal balance between the northern and southern hemisphere.

Our food strategy was executed according to plan as we added alternative protein capacity and invested in our food Tech startup through our ICL planet hub and you can expect to see more of these types of investments in 2022.

Our food strategy was executed according to plan. As we added alternative protein capacity and invested in a food tech startup through our ICO Planet Hub, and you can expect to see more of these types of investments.

Our industrial businesses, specifically our industrial product segment, benefited from its commitment to focusing on long-term customer partnerships and on delivering in reliable fashion. And we also added capacity.

Our industrial businesses, specifically, our industrial products segment benefited from its commitment to focusing on long term customer partnerships and on delivering and reliable fashion and.

And we also added capacity to meet new commitments.

from my financial perspective, there were many achievements which have been around

From a financial perspective, there were many achievements, which of you Ron will review.

Still, I would like to highlight the significant acquisitions we made in 2021 while maintaining our net cast position as we continue to strengthen our solid cast for generation.

Still I would like to highlight the significant acquisitions, we made in 2020 , one while maintaining our net cash position as we continue to strengthen our solid cash flow generation.

On Slide 12, you can see our outlook for 2022.

We expect commodity prices to remain firm through at least the first half of the year and supported by strong demand relating to food security concerns higher food in crop prices and supply constraints.

We expect commodity prices to remain firm through at least the first half of the year and supported by strong demand relating to food security concerns, higher food and crop prices and supply

For our specialty businesses, we will maintain our strategic focus and we expect overall good visibility for the year due to our emphasis on long-term contracts and a very healthy demand pipe.

For our specialty businesses, we will maintain our strategic focus and we expect overall good visibility for the year due to our emphasis on long term contracts and a very healthy demand pipeline.

We will continue to invest in additional capacity to help support our continued growth with higher growth Capex in 2022 focused on supplying our long term contracts through additional infrastructure.

We will continue to invest in additional capacity to help support our continued growth with higher growth capics in 2022, focused on supplying our long-term contracts through additional...

We will also maintain our company wide focus on innovation as we look to generate new opportunities and efficiencies.

We will also maintain our company wide focus on innovation as we look to generate new opportunities and

Our sustainability plan is on track and we are gaining momentum as we continue to receive third party accolades for our efforts.

Our sustainability plan is on track and we are gaining momentum as we continue to receive third party accolades for our efforts.

Finally, we expect to maintain our disciplined approach to cost management to support our strong cash flow and increase dividend payouts. And of course, we will continue to execute on our strategic leadership goals in the areas of sustainable agriculture, food and industrial

Finally, we expect to maintain our disciplined approach to cost management to support our strong cash flow and increased dividend payouts and of course, we will continue to execute on our strategic leadership goals in the areas of sustainable agriculture, food and industrial solutions.

As always I want to thank the entire ICL family of employees spread out across the globe for all their hard work and contributions in 2020 one.

As always, I want to thank the entire ICO family of employees spread out across the globe for all their hard work and contributions in 2020.

We appreciate that our record profitability is a result of your tremendous efforts. Thanks for your time.

We appreciate that our record profitability as a result of your tremendous efforts.

And with that I will turn the call over its out of Iran.

Thank you Aviv and told a few joining us today.

Thank you Aviv and to all of you joining us today. I must tell you that I am pleased to be a part of reporting this outstanding quarter. In a while you have already seen slide 14. I would like to call out just a few additional highlights.

Must tell you that I'm pleased to be about of reporting this outstanding quarter and why do you have already seen slide 14, I would like to call out just a few additional highlights.

Sales crossed $2 billion up more than 50% year over year, our adjusted EBITDA, a fourth quarter record was up more than 100% with margin of 28% up more than 780 basis points.

sales crossed two billion dollars and were up more than 60% year over year. Our adjusted EBITDA, a fourth quarter record, was up more than 100%. With margin of 28% up more than 780 basis points, it just did diluted the earnings per share of 26 cents, where up 21 cents are approximately 400%.

Adjusted diluted earnings per share of 26 cents were up 21 cents or approximately 400%.

Operating cash flow of 344 million dollars was up nearly 90 million dollars over the fourth quarter of the last year and approximately 70 million dollars from third quarter of this year. As Raveve mentioned, we delivered free cash flow of 166 million dollars in the fourth quarter. And while each of our business segments contributed, industrial products delivered record cash flow for the second consecutive quarter.

Operating cash flow of $344 million was up nearly $90 million over the fourth quarter of the last year and approximately $70 million from third quarter of this year as Rajeev mentioned, we delivered free cash flow of $166 million in the fourth quarter.

While each of our business segments contributed industrial product delivered record cash flow for the second consecutive quarter.

In the soft water, our results were driven by both our specialty solutions and commodity upfade moment.

In the fourth quarter, our results were driven by both our specialty solutions and commodity upside momentum.

while our specialty business, including industrial product, phosphate specialties and innovative solutions, had record quarters, we also saw significant year-of-the-year improvement in commodity price.

While our specialty business, including industrial product phosphate specialties and innovative AG solutions had record quarters. We also saw significant deals a year improvement in commodity prices.

On slide 15, you can see how potash phosphoric acid and sulfur prices have trended with each reaching levels not seen over the past 10 years.

On slide 15 you can see how Portage for Sforric acid and Salsa prices have trended with each reaching levels not seen over the past ten years.

not only our commodity prices higher but so are the prices for the raw materials which go into our specialty solution.

So not only a commodity prices higher but so are the prices for the raw materials, which go into our specialty solutions.

Also, as we have shown in previous quarters, you can see the acceleration of marine transportation costs over the past four quarters.

So as we've shown in previous quarters, you can see the acceleration of marine transportation costs over the past four quarters.

While this cost appears to be stabilizing we're still seeing higher rates that at any time over the past decade.

while this cost appears to be stabilizing, we are still seeing higher rates that at any time over the past decade.

Nonetheless, our teams will continue to work to overcome supply chain challenges in higher overall costs.

Nonetheless, our teams will continue to work to overcome supply chain challenges and higher overall costs. We will also continue to leverage our advantageous production locations and global supply chain capabilities to maintain our position as one of the world's lowest cost producers and to continue to deliver the closer.

We will also continue to leverage our advantageous production locations and global supply chain capabilities to maintain our position as one of the world's lowest cost producers and to continue to deliver the consistent supply our customers rely upon.

As to supply our customers rely upon.

On the left side of Slide 16, you can see the impact of higher prices on our year over year sales growth and also the positive contribution from slightly higher fourth quarter quantities and from our recent Brazilian acquisitions, I would like to point out the organic bullshit five no.

On the left side of slide 16, you can see the impact of higher prices on our year-over-year sales growth and also the positive contribution from slightly higher fourth quarter quantities and from our recent Brazilian acquisition.

I would like to point out the organic portion of our innovative ag solution business represented 69% of the segment sales in the quarter. And both our existing business and acquisitions help drive false quarter growth.

<unk> solutions business represented 59% of the segment sales in the quarter and both our existing business and acquisitions helps drive fourth quarter growth.

For phosphate solutions, we continued our strategic shift towards increasing specialty sales, which represented 61% of sales in the fourth quarter, and increased from 53% in the third quarter of this year. On the right side of the slide, while you can see improvements from all four of our segments, the impact of higher potter prices over the past few months has clearly begun to flow through to our results.

For phosphate solutions, we continued our strategic shift towards increasing specialty sales, which represented 61% of sales in the fourth quarter, an increase from 53% in the third quarter of this year on the right side of the slide while you can see improvement from all four of our segments.

The impact of higher purchase prices over the past few months has clearly begun to flow through to our results.

Turning to slide 17, you can see the significant contribution of the tire prices made to adjusted EBITDA, but once again when the second basis, all full fault businesses contributed to the year over year improvement for phosphate solutions. The sharp increase in commodity prices drove dispulsion of the business.

Turning to slide 17, you can see the significant contribution that higher prices made to adjust the EBDA, but once again, on a second basis, all so far businesses contributed to the year of a year improvement.

for phosphate solutions, the sharp increase in commodity prices drove this portion of the business to represent 60% of EBIDA. However, we also prioritized our phosphate specialties focus which drove significant increases in sales volume.

To represent 60% of EBITDA. However, we also prioritize our phosphate specialties focus which drove significant decreases in sales volume.

Well go next to slides you can see the same sales and adjusted EBITDA for our full year Slide 18 shows prices was still a significant contributor to 2021 phase However, our Brazilian expansion and increased quantities each contributed more than $300 million to sales.

On the next two slides, you can see the same sales and adjusted EBD charts for our full year. Slide 18 shows prices were still a significant contributor to 2021 sales. However, our Brazilian expansion and increased quantities each contributed more than $300 million to sales.

For I E S. Organic sales represented 73% of total 2021 while the phosphate solution specialty saves comprised 55%.

For IAS, organic sales represented 73% of total 2021, while the phosphate solution specialty sales comprised 65%.

On a segment basis, once again, all four segments contributed to the significant year-over-year growth in sales, bringing out total for 2021 to $7 billion. The second highest in company history.

On a segment basis once again, all four segments contributed to the significant year over year growth in sales, bringing our total for 'twenty 'twenty $1 billion to $7 billion. The second highest in company history.

Turning to slide 19, where prices had the biggest influence on more than 60% improvement in adjusted EBITDA, the organic contribution to IAS was more than 60%. While commodities came in at exactly 60% for our phosphate solutions. Again, if commodity prices increased over the course of the year.

Turning to slide 19, where prices had the biggest influence on more than 60% improvement in adjusted EBITDA. The organic contribution to I E. S was more than 60% while commodities came in at exactly 60% for our phosphate solutions.

Gail as commodity prices increased over the course of deal.

On a segment basis, each business contributed to a $1.6 billion of annual adjusted debit is all three of our specialty businesses delivered, reckoned, quarterly and annual results.

On a segment basis, each business contributed to a $1.6 billion of annual adjusted EBITDA is all three of our specialty businesses delivered record quarterly and annual results.

Before we turn the call over to the operator for Q&A, which I'm looking forward to, I would like to review a few highlights on slide 20 from both the fourth quarter and the full year. For the fourth quarter, our net debt to EBITDA ratio improved to 1.38 times, from 2.3 times in the fourth quarter of last year. And we have already discussed, we have continued to drive growth in coastal generation with cost controls and efficiency.

Before we turn the call over to the operator for Q&A, which I'm looking forward to I would like to review a few highlights on slides 20 from both the fourth quarter and full year for the fourth quarter, our net debt to EBITDA ratio improved to 138 times from two three times in the fourth quarter of last year.

And we have already discussed we have continued to drive growth and cash generation with cost controls and efficiencies for the full year, we completed approximately $450 million in acquisitions.

For the full year, we completed approximately $460 million in acquisition.

Monetize our YYTH investment in China and deliver strong operating cash flow. thereby maintaining our existing debt level.

Monetize a lightweight th investment in China, and delivered strong operating cash flow, thereby maintaining our existing debt levels.

For industrial products, we exited two non-core assets over the course of the year, including the divestment of our Jappu site in the third quarter.

For industrial products, we exited two non core assets over the course of the year, including the divestment of our zebu site in the third quarter.

We also took certain text actions during the fourth quarter of this year, which caused our effective text rate to increase to 30% Celsius 24% in the fourth quarter of last year. These actions...

We also took certain tax actions during the fourth quarter of this year, which caused our effective tax rate to increase to 30% versus 24% in the fourth quarter of last year. These actions to cut vantage of a temporary tax provision, which resulted in the release of trapped earnings the related vaccine.

to cut advantage of a temporary tax provision which resulted in the release of crap downings. The related tax impact accounted for the majority of the difference between our reported and adjusted net income for the fall court.

But accounted for the majority of the difference between our reported and adjusted net income for the fourth quarter there.

The adoption of this temporary provision will result in lower tax payments on dividend distributions in the future.

The adoption of this temporary provision will result in lower tax payments.

Distributions in the future.

Our lower adjusted tax rate of 17% for the quarter, versus 19% in the fourth quarter of 2020, also reflects the increase in profitability of our YPH subsidiary in China, following several years of losses, in which a different tax asset was not created for these losses.

Our lower adjusted tax rate of 17% for the quarter versus 19% in the fourth quarter of 2020 also reflects the increasing profitability of our light P. H subsidiary in China. Following several years of losses in which a deferred tax asset was not created for these losses.

As we begin 2022, we are pleased to be entering our second year of providing adjusted EBDA guidance, which you can see on slide 21.

As we begin 2022, we are pleased to be entering our second deal of providing adjusted EBITDA guidance, which you can see on slide 21, we expect to deliver a range of between $1.850 billion and 2 billion and $50 billion in 2022 given our.

We expect to deliver a range of between $1,860,000, and $2,000,000, and $60,000,000 in 2022.

Given our strategic focus on the growth of our specialties businesses, we are expanding our guidance to provide more clarity, and we anticipate our specialty business will provide approximately 875 to 925 million dollars of this amount of annual EBITDA.

Focus on the growth for specialty businesses, we are expanding our guidance to provide more clarity and we anticipate our specialty business will provide approximately $875 million to $925 million of this amount of annual EBITDA.

Finally, as a reminder, we have adopted T. C. F D. A reporting fall 2021 annual report and we appreciate all of the hard work our internal teams have done to help us take this giant step forward towards more transparency sustainability reporting and with that I would like to turn the call back.

Finally, as a reminder, we have adopted TCFD reporting for our 2021 UN report, and we appreciate all of the hard work our internal teams have done to help us take this giant step forward towards more transparent sustainability reporting. And with that, I would like to turn the call back over to the operator of FOKUNA.

Over to the operator for Q&A.

Thank you. We will now begin the question and answer session. To ask a question via the audio, please press star and run on your telephone keypad and wait for your name to be announced.

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If you wish to cancel your request, please press the high.

If you wish to cancel your request please press the husky.

And again, please press star and one on your telephone keypad if you wish to ask a question.

And again, please press star and one on your telephone keypad.

If you wish to ask a question.

Okay.

And we.

We have quite a few questions of the first question comes from the line of Joel Jackson. Please ask your question. Joel is from BMO Capital.

We have quite a few questions.

First question comes from the line of Gillette Jackson. Please ask your question Joel is from BMO capital.

Hi, This is bria Murphy on for Joel Thanks for taking my question.

Hi, this is Maria Murphy on Fragile. Thanks for taking my question. So you're guiding to 300 million of EBITDA growth in 2022. How much of this is expected to come from potash pricing increases and how much is from other drivers? I guess can you please be as granular as possible in helping us bridge the different buckets of earnings growth next year?

So you're guiding to 300 million of EBITDA growth in 2022, how much of this is expected to come from potash price increases and how much is from other drivers.

Can you please be as granular as possible, helping us bridge that in some pockets of earnings growth next year.

Hey, can you hear me? Yes, okay.

Okay.

Can you hear me, yes, okay. So.

So the put ash price is based on existing Q4 average price. Actually the real ice price was 471 and our guidance for next year is based on about 425.

So the put ash prices based on our existing Q4.

Our average price.

Actually the realized price was a 471 and where our guidance for next year is based on about 425.

The difference, we are basing on Q4, but we're basing Q4 prices and the distribution, geographical distribution of sales according to our adjusted plans for 2022.

The difference are we are basing on Q4, but were basing Q4 prices and distribution geographical distribution of sales. According to our adjusted plans for 2020 two.

So we're not taking into account the expected a change in Chinese prices and we're still modeling India prices. According to our our Q4 price which was 445.

So we're not taking into account the expected change in Chinese prices and we're still modeling India prices according to our Q4 price which was 445. So you can do the math from there.

So you can do the math from there.

Okay. That's helpful.

And do you know.

And to feel the might need the environment for a different answer, small, negative, to your ICL, what are you doing for magnesium? I've been 20, 20, 20, 20, we are guided. And I have the stuff that's between.

The mine life.

There are small.

Yeah.

What are you assuming for acne.

Got it.

I second.

Uh huh.

Okay, so there's been a hike in Magnesium prices or rather Magnesium prices are much higher than usual. They're running around $8,000 a ton in China now which is much higher than their average price. When Magnesium prices spike the couple months ago we closed most of the sales for next year.

Okay. So there has been a hike in magnesium prices are rather magnesium prices are much higher than usual there are running around eight.

<unk> $8000 a ton in in China, now, which is much higher than their average price.

When magnesium prices spiked a couple of months ago, we closed most of the sales for next year.

So we will see our magnesium business profitable for the first time ever. And basically the projection is a relatively conservative projection, even though we have annual contracts.

So we will see our magnesium business are profitable for the first time ever.

And basically the projection is relatively conservative projections, even though we have annual contracts.

Because we're taking into account that is drastic change happens in price or the other way then we may not be able to actually.

because we're taking into account that if drastic change happens in price of the other way, then we may not be able to actually execute the contracts as the R today. At current prices, we would have a swing of over $50 million. We're modeling less than that in order to be more conservative.

Execute the contracts as they are today.

At current prices, we would have a swing of over $50 million, we're modeling less we're modeling less than that in order to be more conservative.

Thank you.

Okay.

Thank you.

Thank you. The next question comes from the line of Alex Jones of Bank of America. Please ask your question.

The next question comes from the line of Alex Jones with Bank of America. Please ask your question.

Good afternoon, thanks, very much for taking my questions. Two if I may the first one on Capex can you talk about higher gross capex to capture some of the opportunities you're seeing could you give us some quantification of the capex spend in 2022 and the particular projects.

Good afternoon, thanks very much for taking my questions. Two, if I may, the first on CAPEX, you talk about higher growth CAPEX to capture some of the opportunities you're seeing. Could you give us some quantification of the CAPEX spending in 2022 and the particular projects that you're accelerating spending on that in the first question?

You're accelerating spending on I think my first question. Please.

Yeah.

Thanks, Alex. Yeah, we're going to see about $100 million of additional cappix next year for growth. And this is going for some of it is going to industrial products, additional capacity as we are signing additional long-term contracts and have to provide the capacity for that. So we're sort of growing in concurrence with the new business coming in.

Thanks, Alex Yeah, we were going to see about $100 million of additional Capex next year for growth and this is going for some of it is going to industrial products additional capacity as we are signing additional long term contracts and have them have to provide the capacity for that.

So we're sort of growing in concurrence with the new business coming in we're also are building additional capacity for our M. A pea for the a L. S. P industry. We're doing that are in China. We're also looking for investments than in other regions, but specifically the plans are currently.

We're also building additional capacity for MAP, for the LFP industry. We're doing that in China, while also looking for investments in other regions, but specifically the plans are currently in China. And we're also building additional specialty fertilizer capacity in a few countries, including in Europe , for...

In China, and we're also building additional specialty fertilizer capacity in a few countries, including in Europe for biodegradable coding.

biodegradable coding, sorry biodegradable coded fertilizer.

I'm, sorry by degradable coded fertilizer.

We're building capacity in We're planning to build a new capacity in Brazil.

We are building capacity, new capacity and and we plan to build new capacity in Brazil.

uh... in india uh... and so between brazil india and uh...

In India.

And so between Brazil, India and in Europe .

In Europe , there's a significant investment in our specialty fertilizer business. Those are the significant components. In phosphate, it's for MAP for LFT batteries. The three geographies I mentioned for specialty fertilizers. And the additional capacity needed for our expansion on the industrial product, flame retardant business that's coming in.

There is a significant investment in our specialty fertilizer business and so those are the those are the significant components in phosphate it through a M. A P for L. P batteries, the three geographies I mentioned for specialty fertilizers and the additional capacity needed for our expansion on the.

Industrial products are.

Flame retardant business that's coming in.

Hope that helps.

That's great. Thank you and just one other question on the EBITDA guidance and specifically the specialties guidance.

Great, thank you. And just one other question on the EBITDA guidance, and specifically the Specialties guidance. If I'm correct in thinking that that includes industrial products, innovative ag and the phosphate specialties, then I think at the midpoint, it's only implying 4% year or year growth in EBITDA and those divisions, which is a...

If I'm correct in thinking that that includes industrial products.

And in the phosphate specialty spend I think at the midpoint.

Implying 4% year on year growth in EBITDA in those divisions.

significant slowdown on the growth rate that you've been doing in the past couple of years. Could you comment on what might be driving slower growth in those divisions or is that just a particularly conservative forecast for start the year?

Significant slowdown on the growth rate that you've been getting in the past couple of years could you comment on what might be driving.

Gross most divisions, whether that's just a particularly conservative hold costs to stop thank you.

Yeah.

The forecast implies about 10% growth. It's inhibited a little bit by a change in the

The forecast implies about a 10% growth.

It's inhibited a little bit by a change a change in the specialty fertilizer business as we are shifting the poly sulphate business from the potash division to the specialty fertilizer division as we recognize that a given that we're now able to demand a premium.

specialty fertilizer business as we are shifting the poly sulfate business from the putash division to the specialty fertilizer division as we recognize that Given that we are now able to demand a premium and we are we've developed some specialty products that are based on poly that makes sense to treat that business as a specialty business

And we are we've developed some specialty products that are based on poly then it makes sense to treat that business as a specialty business.

And since we're adding it this year and since it's still not a profitable business, then the actual growth in the Specializer Business will be inhibited by that component of the business. If you back that in.

And since we're adding it this year and since it's a it's still not a profitable business than the actual growth in the specialty fertilizer business will be inhibited by that component of the business. If you back that in then we'll have we'll have an average of about 10% growth in the specialty businesses and.

then we'll have an average of about 10% growth in the specialty businesses. And I agree that it's a little conservative.

I agree that it's a little conservative one of the reasons for that is that some of the capacity that's needed for growth.

One of the reasons for that is that some of the capacity that's needed for growth

If we don't build an additional price increase above what we already know.

If we don't if we don't build in additional price price increases above what we already know.

We need the additional capacity to come in. It's not enough to start making the investment. The investment has to be built in order to be able to create the revenue. So some of the growth could have been captured if we would possibly be able to build the capacity faster. But unfortunately, we're building it as fast as we can.

We need the additional we need the additional capacity to come in it's not enough to start making the investment the investment has to be built in order to be able to.

Create the revenues. So are some of the growth could have been captured if we would possibly be able to build the capacity faster, but unfortunately.

We're building it as fast as we can.

It's conservative, it is a conservative forecast in terms of pricing because we don't want to build in any additional pricing increases above and beyond what we already know.

It's conservative it is a conservative it.

It is at the <unk>.

<unk> forecast in terms of pricing because we don't want to build in any additional pricing increases above and beyond what we already know.

Thank you that's very helpful.

Thank you.

The next question comes from the line of Mubasha, Shaudhry, of City. Please ask your question.

The next question comes from the line of Russia Chowdhry of Citi. Please ask your question.

Hi, Thank you for taking my questions and just getting back to the guidance I think it took you said that the guidance for next year based on 425.

Hi, thank you for taking my questions. Just going back to the guidance, I think you said that the guidance in next year is based on 425.

of which including $425 per ton for pay.

Hum on average selling price of $425 a ton for potash.

which is around $100 higher than what you did in 2021. So I just want a volume neutral base if I get to 400 million of food, mentally that are receiving the price drop so there's not change in cost. So which is quite conservative. Will you guide us compared to that is quite conservative. So...

Which is around.

$100 higher than what you did in <unk>.

2021 and say if I just on a volume neutral days since I get to a.

400 million of incremental EBITDA.

Excuse me the price drops thunderbolt changing corso.

Richard quite conservative with your guidance compare to that quite conservative so.

Just some comments around about it, to are you seeing a significant showdown in other divisions or kind of what your function by there, that would be helpful.

Just some comments around the market.

Are you thinking of things that go down in the other division what kind of.

What you'll you'll assumptions are there that would be helpful.

And the volume for potash in the food goods were down quite strong. Can you provide some comment around what drove the Lose to China and India?

And.

The volumes for potash in the fourth quarter were down quite strong.

Had some commentary around what drove the lower sales to China and India.

whether and whether that you see that the system into 1222

Whether that you see that persisting into <unk> 'twenty two.

I'm sorry, just finally, how sold are you when we go into kind of, are you sort of, are your volumes kind of confirmed for once you and two key and you have relatively good visibility on your price and volumes in port hash? Thank you.

Sorry, just finally.

Household are all you when we go into it.

Yeah.

Williams kind of confirmed for once you're into Kieran do you have relatively good visibility on your price and volumes.

And Portage thank you.

Okay. Thanks for that Oh.

Okay, thanks for that. I'll try to go through the more difficult part of the question and that would be the product distribution in terms of sales. So we typically sell between 1.2 to 1.5 million tons to India and China. The current plan is around 1.3 for the year, which is a little bit more than 25%.

Try to go through the the more difficult part of the question and that would be the product distribution.

In terms of sales so we typically sell.

Between one point to 1.5 million tons to India and China are the current plan is around 1.3 for the year, which is a little bit more than 25%.

Those 25% are built into the model according to existing Q4 prices, which admittedly do not build in the expected new pricing for the new contracts in China. And of course, following that, we expect the new contract in India.

Those 25% are are built into the model according to existing Q4 prices, which which admittedly do not build in the expected new pricing.

For the new contracts in China and of course falling that we expect the we expect a new contract in India.

So that is the component that gets affected once these contracts are done. In terms of your analysis on the additional EBIDA coming from put ash.

So that's a that is the component that gets affected once once these contracts are done.

In terms of your analysis on the additional EBITDA coming from potash than our given our given the change in our in distribution and the the relevant transportation and other costs the additional E.

than our given the change in distribution and the relevant transportation and other costs, the additional EBITDA is a little lower than $400 million. And then again, there's about $80 million coming from additional EBITDA on the specialty side. So that pretty much explains the additional EBITDA that we expect for next year. I hope...

EBITDA is a little lower than the $400 million.

And then again there is about $80 million coming from additional EBITDA on the specialty side, so that pretty much explains.

The additional EBITDA that we expect for next year.

Hope that helps.

That's very helpful. Thank you.

Thank you the.

Thank you. The next question comes from the line of Jeff Haer of UBS. Please ask your question.

Next question comes from the line of Jeff <unk> of UBS. Please ask your question.

Actually all my questions have been answered, sorry, I'm answered. And so I don't have any more.

All my questions have been answered I'm, sorry, I'm, sorry, I'm, sorry, I don't have anymore.

Thank you. In that case, the next question comes from the line of Duffy Fisher, the O of Barclays, please ask you.

Thank you Keith.

That case. The next question comes from the line of Duffy Fischer.

Of Barclays. Please ask your question.

Yes, good morning, good afternoon. If you start with the 575 of Q4 EBITDA and just do a bridge to Q1, you know, can you just talk about puts and takes what gets better and what might be getting worse as we go from Q4 to Q1 with that number?

Yes. Good morning. Good afternoon, if you start with a 575 of the Q4 EBITDA and just do a bridge to Q1, you know can you just talk about puts and takes what gets better and what might be getting worse as we go from Q4 to Q1 with that number.

Okay, and maybe ill add to the question that was asked before that I didn't that I didnt actually answer we are or pretty much close to sold out for Q1 are not beyond that we're holding on some of the sales are until theres more.

Okay, maybe I'll add to the question that was asked before that I didn't, that I didn't actually answer. We are pretty much close to sold out for Q1.

Not beyond that. We're holding on some of the sales until there's more clarity on

Clarity on on Chinese contract as well as Belorussian about the the Belorussian situation that that you all know.

on Chinese contract as well as Bella Russian, the Bella Russian situation that you all know.

In Q1, what changes is the distribution of sales? What happened in Q4?

In Q1 are what the changes is the is the distribution of our of sales what happened in Q4.

is that we sold much less to China and also to India.

Is that we sold much less to our China and also to our India. In fact, we are in our previous call. We we expected about 100 to $110 of additional put us price average for the quarter and it ended up being.

In fact, in our previous call, we expected about $100 to $110 of additional put-ass flight average for the quarter, and it ended up being over $150, I think, cost 160 because we upgraded our India contract.

Over 150, I think close to 160 60, because we upgraded the we upgraded our India contract and as a result, we were able to we we were able to better our better our intake.

And as a result, we were able to, we were able to better our intake. We're talking about an additional $50 million for Q4 after the adjustment. So when you go from Q4 to Q1, obviously, and mine we guru official

We're talking about an additional $50 million for from Q4 after the adjustment. So when you go from a Q4 to Q1 obviously.

Pricing is the pricing has not changed much from Q4 to Q1 at this time.

pricing is not changed much from Q4 to Q1 at this time. And the Chinese contract could affect to a very small extent Q1. It could be very meaningful for Q2 and afterwards.

At this time.

And the Chinese contract that could affect our two are it's a very small extent Q1.

It could be very meaningful for Q2 and and afterwards.

Well I guess my question was the whole company not just potash now 575 number I don't see anything in that number that really shrinks from Q4 to Q1, so kind of at that level or above I would assume is where most people come in and out is that fair.

I guess my question was the whole company not just Pada, so I mean that 575 number, I don't see anything in that number that really shrinks from Q4 to Q1. So kind of that level or above, I would assume is where most people come is that fair?

It's fair that there's nothing that's it's fair that there's nothing that's particularly going down also.

It's fair that there's nothing that's, it's fair that there's nothing that's particularly going down. So the bromine business is not going down.

So the bromine business is not going down and the phosphate business is not going down the specialty fertilizer, Brazil is seasonal so.

and the phosphate business is not going down. The specialty fertilizer Brazil is seasonal, so...

Qion in the Brazilian part, which is rather significant, could be lower than the fourth quarter.

Q1 and are in the Brazilian part, which are which is rather significant could be lower than our than the fourth quarter and put ourselves already explained it's a matter of a distribution.

And put us out, I already explained that's a matter of distribution.

Sure. Okay. So that would get me you know what round numbers, you know $6.6 billion of EBITDA for Q1, a seasonally light quarter generally for you guys. I mean, it would seem is logical that the year is two and a half billion is it is your guide of 2 billion, where would you push back on that.

Okay, so that would get me, you know, let ground numbers, you know, $0.6 billion of EBITDA for Q1, a seasonally light quarter, generally for you guys. I mean, it would seem as logical that the year is two and a half billion, is it is your guide of two billion? Would you push back on this?

<unk>.

Like I said, we could get closer to your number depending on Chinese contract because consider that we're modeling for China for the China products and I explained the quantities were modeling $249 at this point so keep in mind that our you know one.

Like I said, we could get closer to your number, depending on Chinese contracts, because consider that we're modeling for China, for China products and explain the quantities, we're modeling $249 at this point.

So keep in mind that 1.3 million tons, China, the rumor in China is that prices are going to be between 506 hundred and 600, depending who you ask, if you ask.

Nine 3 million tons.

China the rumor in China is that our prices are going to be between 506 hundred depending who you asked if you ask a.

If you ask some of those folks that are close to the suppliers, they'll tell you 600 and above. But if you model somewhere between 500 and 600, then we're talking more than doubling the price. So take 700,000 tons.

If you asked some of are those folks that are close to the suppliers they'll tell you 600 and above but I.

If you modeled somewhere between 506 hundred are then we're talking more than doubling the price.

And so take a 700000 tons and and add that in and and then add the relative. Our addition to the India portion would be also significant on another 600000 or so then it gets you close to your numbers still not.

and add that in and then add the relative addition to the India portion which would be also significant on another 600,000 or so. Then it gets you close to your number, still not there but close. Okay.

There, but close.

Okay terrific. Thank you guys. Thank.

Thank you.

Thank you.

Thank you. The next question comes from the line of Lawrence Alexander of Jeffries. Please ask your question.

The next question comes from the line of Laurence Alexander of Jefferies. Please ask your question.

Good morning, Ken.

Good morning. Given the environment that you're sketching, can you give an update on your thoughts around your balance sheet management? How much you could flex the balance sheet for M&A?

Given the environment that you're sketching can you give an update on your thoughts around your balance sheet management, you know how much you could flex the balance sheet for M&A.

Secondly, with respect to the alternative protein.

Secondly, with respect to the alternative protein and battery materials markets in particular.

And battery materials markets in particular.

What do you see as the target for paybacks for investments in those areas given the kind of larger term growth potential?

Do you see as the target for <unk>.

Paybacks for investments in those areas, given the kind of longer term growth potential.

Okay, so batteries is easy. It's the one year payback. Alternative proteins probably between two and a half to three years. Relatively good paybacks. And on the balance sheet, I'll turn it over to a Vellan.

Okay. So batteries is easy it's a one year payback alternative proteins, probably between two and a half to three years.

Relatively good paybacks are in on the balance sheet I'll turn it over to of Yolanda.

Yeah.

Now the current debt that we have, if you benchmark it with the EBD,

Our current.

That would have if you benchmark it vis vis the beta that we have.

It's practically an on issue because the theoretical capacity that we have would vastly exceed $1 billion.

It's a it's practically a in an issue because the theoretical capacity that we have with vastly exceeded 1 billion dollar mode.

If you do the mast, though, and that's not the limiting factor at this stage.

If you do the math, though and that's that's not the limiting factor at this stage. If you want more specifics we can go through the math, but I think that that's a that should cut it.

more specifics which can go through the maths, but I think that that

Thank you we've gone down all the way to one four debt over EBITDA and think about this and we've got a really significant free capacity not theoretical calculation, but real capacity that.

Thank you. We've gone down all the way to 1.4, Nato Vibida. And think about this. And we've got really significant free capacity, not theoretical by calculation, but real capacity.

That we can tap into as much as we need.

And of course, given the strong balance sheets are given the right opportunity. Then we're looking forward to increase our earnings power and take a take advantage of.

And of course, even the strong balance sheet given the right opportunity that we're looking forward to increase our earning power and take advantage of the opportunity that makes sense in the businesses that we're focused on. Again, subject evaluation, we're not in a rush to do anything. We want to get the right deal. We're very, very happy with the Brazil acquisitions that we did.

Of the opportunities that make sense.

The businesses that we're focused on again subject to evaluation, we're not in a rush to do anything we want to get the right deal. We're very very happy with the Brazil acquisitions that we did.

Thanks.

Thank you. The next question comes from the line of Vincent Andrews of Morgan Stanley . Please ask your question.

Thank you. The next question comes from the line of Vincent and Andrews of Morgan Stanley . Please ask your question.

Hi guys, this is Will on for Vincent. I just had one quick one. You guys had previously talked about the potential renewal of some long-term contracts in your industrial products business.

Hi, guys. This is well on for Vincent.

Quick one.

That's a pretty good you previously talked about.

Potential renewals of some long term contracts.

And your industrial products business.

I'm just wondering how much of that pricing momentum you guys found this this quarter was driven by by those record elemental bromine prices that you guys called out versus those contracts are new and kind of what does that mean for pricing within the industrial products that meant for the first half of the next year or the year I guess.

I'm just wondering how much of that pricing momentum you guys saw this quarter was driven by a rapid elemental bromine prices that you guys called out versus those contract.

What does that mean for pricing.

Industrial products for the first half.

That's right.

Okay. So so the record spot prices didn't really have any impact.

Okay, so the records spot prices didn't really have any impact in Q4 other than a very small portion of our sales, which is sales of the elemental bromine less than 10% of sales from the bromine part of the business.

In Q4 other than a very small portion of our sales, which is sales of elemental bromine less than 10% of sales.

From the growing part of the business.

There is an effect in Q1.

There isn't effect in Q1.

Some of our contracts have pricing reviews that depend on spot prices. Not necessarily just bromine but also TBBA and other materials that have spot prices. And the pricing environment is good. And during the first quarter we will see some price increases in existing contracts.

Some of our contracts are have a pricing reviews that depend on spot prices are not necessarily just bromine, but also T be be a another other other materials that have spot prices.

And the the pricing environment is good and the during the first quarter, we will see some price increases in existing contracts.

all in all positive at the same time there are also some raw material cost that increase

All in all positive at the same time, they're also some raw material cost increase.

So the net effect is not going to be very significant, but still there is going to be a positive effect on earnings, even before additional capacity comes in, which will happen sometime around July next year.

So the net effect is not going to be very significant but still there is going to be a positive effect on earnings even before additional capacity comes in which will happen sometime around July next year.

Got it and then I guess, just a quick follow up.

Got it. And then I guess just a quick follow up. How are you guys looking at some kind of, even then margins for the industrial cost that's been 2022 just given the elevated prices, kind of offset by the higher raw material cost and the logistics cost.

How are you guys looking at kind of EBITDA margins for the industrial parts, one and two just given the elevated pricing.

That is offset by other tired.

Raw material costs.

Sure.

We're working very hard to get some additional margin expansion next year. It's not going to be easy, but we're targeting some margin expansion next year.

We're working very hard.

To get some additional margin expansion next year.

Not going to be easy, but but we're targeting we're targeting some margin expansion next year.

It won't be dramatic, but but there is some room for margin expansion again due to the update of pricing, which will be what you'll be incrementally positive relative to the raw material and transportation costs.

It won't be dramatic, but there is some room for margin expansion. Again, due to the updated pricing, which will be, which will be incrementally positive relative to the raw material and transportation costs.

Got it thank you.

Thank you. The next question comes from the line of Amit <unk> of US capital. Please ask your question.

Thank you. The next question comes from the line of Amid Baroque of Oscapital. Please ask your question.

Hey, guys and thanks for taking my questions and congratulations for the quarter and the year.

Hey guys, and thanks for taking my questions and congratulations for the corner in the year. Kind of have a three-part question if I may.

Kind of have a three part question if I may.

What is your view on the whole available situation? How will affect available capacity of Podash? And do you think can other players like Neutrion can offset the shortage if that will be the case?

What is your view on the whole our billable situation how does it affect available capacity.

Dash.

And do you think can all their players like any new tier one can offset the shortage if that wouldn't be the case.

Look, first of all, a lot of what we know, we read like you guys. So what we know about Belarus is that first of all, everybody knows, there's 14 million tons that they bring into the market. They could bring to the market this year.

Look first of all a lot of what we know we read like you guys. So what we know about Belarus is that first of all everybody knows.

There's a 14 million tons that are they bring into the market they could bring to the market. This year.

90% of their product goes through Lithuanian railway to a cafeteria port and that's not happening anymore since February 1st.

90% of our their product goes through Lithuanian railway.

Two of <unk> port and that's not happening anymore since our February 1st.

uh... from what we understand uh... there's no uh... there's no alternative uh... that fixes the situation for them uh... unless of course uh... sanctions go away

From what we understand are there is no.

There's no alternative that fixes the situation for them.

Unless of course sanctions go away. So we understand that some product has been a pre sold to a Brazil or there's some talk that maybe given that there's somewhat blocked from the international banking system because of.

So we understand that some product has been pre-sold to Brazil. There's some talk that may be given that there's somewhat blocked.

from the international banking system because of

us actions there's some talk that uh... or or or or we read like you guys that uh... maybe india will buy in rupee's a million times which uh... we don't know how how it gets to uh... to india but uh... but that's something that we've heard

U S sanctions there was some talk that the ore we read like you guys that are maybe India will buy in rupees a million tons, which are we don't know how how he gets to to India, but but that's something that we've heard.

There may be some product and some ports close to customers, but probably not very much.

There may be some product in some ports close to customers, but probably not very much.

So ultimately it seems like millions of tons are either not going to get to the market or are going to get to the market late and the the day for certainty seems like April 1st when are the formal the formal date for sanctions are or the.

So ultimately it seems like millions of tons are either not going to get to the market or are going to get to the market late. And the day for certainty seems like April 1st when the formal date for sanctions or the end of the wind period arrives.

And of the Windup period arrives.

So again this is why are the way we view. This year's guidance is that you know we have good clarity on our specialties are good visibility on commodities, we'd rather.

So again, this is why the way we view this year's guidance is that, you know, we have good clarity on specialties, good visibility on commodities. We'd rather, you know, we'd rather take into account what we know and then adjust the guidance according to developments in the market.

You know, we'd rather take into account, what we know and then adjust the guidance. According to developments in the market currently the market the market so sort of a holding on.

Currently the market is sort of holding on, looking to see what happens if the Bill of Russian situation materializes and the product doesn't get into the market and we're talking about somewhat of a different market than we currently have now.

Looking to see what happens if a the belarussian situation materializes in product doesn't get into the market then we're talking about.

Somewhat of a different market than we currently have now.

If there's some solution or sanctions get lifted for any reason, then of course it's a different story. There's also a political tension in that region and nobody knows what's happening with...

If if theres some solution or sanctions get lifted for any reason then of course, it's a different story.

There's also a political tension in that region and nobody knows what's happening with.

you know, Russia and Ukraine and is Russia going to come under sanctions. So there's all kinds of uncertainty on commodities.

Russia, and Ukraine and Russia.

Russia going to come under sanctions, so there's all kinds of uncertainty on on commodities.

The underlying situation is that we're seeing food shortages in some countries. Some countries are building more emergency inventory. The soy prices have gone up by about 20% since November . So the overall situation is that the market is nervous.

The underlying situation is that we're.

We're seeing a food shortages in some countries.

Some countries are building a more emergency inventory.

The soy prices have gone up by about 20% since our since our November so the overall situation is that the market is nervous.

And it's going to be interesting how things develop. But I think other than what we've heard about the alternatives, because there are no port alternatives to Clopidia, at least not for significant amounts of products, definitely not millions of tons.

And.

It's going to be interesting, how things develop but I think other than what we've heard about the.

The alternatives because there are no port alternatives to cathedral.

At least not for a significant amounts of products definitely not millions of tonnes. A we don't see products are coming out in any other regular alternative yeah, no no meaningful product, there's no port that can take a three or 4 million tons of belorussian.

We don't see products coming out in any other regular alternative. Yeah, no meaningful product. There's no port that can take three or four million tons of Belarusian products at this point. I hope that's...

Products at this point.

I hope that helps but that's about all we know.

Yeah that that really helps so if I understand you correctly in that.

Yeah, that really helps. So if I understand you correctly and that...

And do you expect there would be about 10 to 12 million tons shortage.

You expect there will be about 10 to 12 million tons shortage. Is that fair to say?

Is that is that fair to say.

I don't know if that's the number. I mean, if I had to, if they had to give a number, then I give them credit that they'll find all kinds of solutions and get a little more into the market. But you ask me if Nuchin or anybody else can step up and bring products into the market. Then the long term answer is yes. Can they bring a meaningful amount of tons into the market in a short period of time?

I I don't know if that's the number I mean, if I had to say if they had to give a number then I give them credit that they'll find all kinds of solutions and get a little more into the market, but you asked me if nutrient or anybody else can step up and bring product into the market. Then the long term answer is yes Ah can they.

Bring a meaningful amount of tons into the market in a short period of time, one I don't think so not not more than you know hundreds of thousands of tons and even if they could I'm not sure that they would want to so again you'd have to ask nutrient that unfortunately, we're only priced steak.

One, I don't think so, not more than, you know, hundreds of thousands of tons.

And even if they could, I'm not sure that they would want to. So again, you'd have to ask nutrient that. Unfortunately, we're only price takers in the market. So we see the prices as they are and try to place them in the best place.

<unk> in the market. So we see the prices as they are and try to place them in the best place.

Yeah, that's fair. Thanks for that. So I see, we see it as an upward pressure, for the price. But, and for the last part of my question, that you say you are price-dicker. So,

Yeah. That's fair thanks for that so I see we see it as a as an F. One questioner.

But and for.

The last part of my question that would you say you are a price taker. So.

Uh huh.

Can you give more clarity, I'm more color about your peritone costs? No.

Can you give more clarity and more color about your per ton cost.

So potash.

So we can model all kinds of Oh potash prices.

so we can model all kinds of protest prices.

Yeah, we're we're working on providing a cost per tonne data that will be meaningful for you. So what we were hoping to have that done for you on our portal.

Yeah, we're working on providing cost-for-ton data that will be meaningful for you.

We were hoping to have that done for you on our portal by reporting, but because of

By by reporting, but because of a reasons having to do with the.

Reasons having to do with taxation issues that we're still discussing with our government were deferring that a little bit. And hopefully very soon we'll give you all the details you need and more.

The taxation issues that we're still discussing with our government.

We're deferring that a little bit and hopefully very soon we'll we'll give you all the details you need anymore.

Even that I mean, that's.

Even that, that's great. It's just one addition to this answer.

That's great. He said just one addition to defensive.

that we took a look at it and I think this comparison.

We took a look at it and I think this comparison.

needs to be done with the pinch of salt because they're different definition.

It needs to be done with a pinch of salt because the different definitions.

that different definitions of the cost pattern and you can easily, you know, see a range. What you include inside, what you don't look inside. So continuing to what of you just said, once we do that, we'll have to be very careful to make sure that it's actually to happen and not something different.

There are different definitions of cost per tonne and you can easily.

C a range.

What you include beside what you don't look inside so continuing towards what you've just said once we do that we'll have to be very careful to make sure that it's apples to apples and not something different.

Yeah of course, even a range can help a lot. So if you can provide a range right here it would be it would be very helpful and if not that's and also very helps and thanks again for the engine in our main debt in our main dead Sea facility. We're in a very good place on the global cost curve and then.

Yeah, of course, even a range can help a lot. So if you can provide a range right here, it would be very helpful. And if not, that's also very helpful. And thanks again for the answer. In our main bed, the facility, we're in a very good place on the Global Cost Curve. And in our facility in Spain, our mine in Spain, we're in a not so good place on the Global Cost.

And then our facility in Spain, our mine in Spain, where we're in a not so good place on the global cost curve.

So most of our tons, four million of our tons are in a very good place, meaning that we can make significant profit in any kind of...

So most of our tons a $4 million of our tons are in a very good place meaning that.

We can make significant profit in any kind of market.

Thank you. So we are out of time and that does conclude our concerns for today. Thank you all for participating. You may now disconnect speakers. Please stand.

Thank you. So if you are out of time and that does conclude our conference for today. Thank you all for participating you may now disconnect speakers. Please stand by.

Okay.

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Yes.

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