Attached files
| file | filename |
|---|---|
| 8-K - 8-K - AMPAL-AMERICAN ISRAEL CORP | zk1110269.htm |
| EX-99.1 - EXHIBIT 99.1 - AMPAL-AMERICAN ISRAEL CORP | exhibit_99-1.htm |
Exhibit 99.2
August 2011
COMPANY
PRESENTATION
PRESENTATION
2
About Ampal:
Ampal-American Israel Corporation (“Ampal” or the “Company”) and its subsidiaries acquire interests primarily in businesses
located in the State of Israel or that are Israel-related. Ampal is seeking opportunistic situations in a variety of industries, with a
focus on energy, chemicals and related sectors. Ampal’s goal is to develop or acquire majority interests in businesses that are
profitable and generate significant free cash flow which Ampal can control. For more information about Ampal please visit our web
site at www.ampal.com.
located in the State of Israel or that are Israel-related. Ampal is seeking opportunistic situations in a variety of industries, with a
focus on energy, chemicals and related sectors. Ampal’s goal is to develop or acquire majority interests in businesses that are
profitable and generate significant free cash flow which Ampal can control. For more information about Ampal please visit our web
site at www.ampal.com.
Safe Harbor Statement on Forward-Looking Statements
Certain information in this presentation includes forward-looking statements (within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 , as amended) and information relating to Ampal
that are based on the beliefs of management of Ampal as well as assumptions made by and information currently available to the
management of Ampal. When used in this presentation, the words "anticipate," "believe," "estimate," "expect," "intend," "plan,"
and similar expressions as they relate to Ampal or Ampal's management, identify forward-looking statements. Such statements
reflect the current views of Ampal with respect to future events or future financial performance of Ampal, the outcome of which is
subject to certain risks and other factors which could cause actual results to differ materially from those anticipated by the forward-
looking statements, including among others, the economic and political conditions in Israel, the Middle East, including the situation
in Iraq and Egypt, and the global business and economic conditions in the different sectors and markets where Ampal's portfolio
companies operate. Should any of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual
results or outcomes may vary from those described herein as anticipated, believed, estimated, expected, intended or planned.
Subsequent written and oral forward-looking statements attributable to Ampal or persons acting on its behalf are expressly
qualified in their entirety by the cautionary statements in this paragraph. Please refer to Ampal's annual, quarterly and periodic
reports on file with the SEC for a more detailed discussion of these and other risks that could cause results to differ materially.
Ampal assumes no obligation to update or revise any forward-looking statements.
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 , as amended) and information relating to Ampal
that are based on the beliefs of management of Ampal as well as assumptions made by and information currently available to the
management of Ampal. When used in this presentation, the words "anticipate," "believe," "estimate," "expect," "intend," "plan,"
and similar expressions as they relate to Ampal or Ampal's management, identify forward-looking statements. Such statements
reflect the current views of Ampal with respect to future events or future financial performance of Ampal, the outcome of which is
subject to certain risks and other factors which could cause actual results to differ materially from those anticipated by the forward-
looking statements, including among others, the economic and political conditions in Israel, the Middle East, including the situation
in Iraq and Egypt, and the global business and economic conditions in the different sectors and markets where Ampal's portfolio
companies operate. Should any of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual
results or outcomes may vary from those described herein as anticipated, believed, estimated, expected, intended or planned.
Subsequent written and oral forward-looking statements attributable to Ampal or persons acting on its behalf are expressly
qualified in their entirety by the cautionary statements in this paragraph. Please refer to Ampal's annual, quarterly and periodic
reports on file with the SEC for a more detailed discussion of these and other risks that could cause results to differ materially.
Ampal assumes no obligation to update or revise any forward-looking statements.
Use of Non-GAAP Financial Measures
Ampal uses certain non-GAAP financial measures in this presentation. Ampal uses non-GAAP financial measures as supplemental
measures of performance and believes these measures provide useful information to investors in evaluating our operations, period
over period. However, non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation
or as a substitute for Ampal’s financial results prepared in accordance with GAAP. In addition, investors should note that any non-
GAAP financial measures Ampal uses may not be the same non-GAAP financial measures, and may not be calculated in the same
manner, as that of other companies. Reconciliations of our non-GAAP financial measures are included in this presentation.
measures of performance and believes these measures provide useful information to investors in evaluating our operations, period
over period. However, non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation
or as a substitute for Ampal’s financial results prepared in accordance with GAAP. In addition, investors should note that any non-
GAAP financial measures Ampal uses may not be the same non-GAAP financial measures, and may not be calculated in the same
manner, as that of other companies. Reconciliations of our non-GAAP financial measures are included in this presentation.
§ Incorporated in New York
§ Invests in companies with a stable cash flow
§ Market Value (Million US$)** 43
§ Equity (Million US$) 164.4
3
Company Profile| AMPAL
General Data
Holding Structure
Proportion of Investments
(Holdings Book Value*)
* The Company’s Financial Statements are prepared in accordance with US GAAP (and not IFRS).
** Based on closing price on NASDAQ on August 2, 2011
• Ampal’s investment focus is principally on companies or ventures where
Ampal can exercise significant influence and use its management experience to
enhance those investments.
Ampal can exercise significant influence and use its management experience to
enhance those investments.
• In making its investment decisions Ampal considers among others, quality of
management, potential return on investment, growth potential, projected cash
flow, investment size, financing and All of Ampal’s debts.
management, potential return on investment, growth potential, projected cash
flow, investment size, financing and All of Ampal’s debts.
• Ampal seeks opportunistic situations in a variety of industries, with a focus on
energy, chemicals and related sectors.
energy, chemicals and related sectors.
• Ampal’s goal is to develop or acquire majority interests in businesses that are
profitable and generate significant free cash flow which Ampal can control.
profitable and generate significant free cash flow which Ampal can control.
• Ampal’s current policy is to apply retained earnings to finance its business
activities and to redeem or repay Ampal’s outstanding debt (including its
unsecured notes traded on the Tel Aviv Stock Exchange). The payment of cash
dividends in the future will depend upon Ampal’s operating results, cash flow,
working capital requirements, debt and other factors Ampal’s Board of
Directors will deem pertinent.
activities and to redeem or repay Ampal’s outstanding debt (including its
unsecured notes traded on the Tel Aviv Stock Exchange). The payment of cash
dividends in the future will depend upon Ampal’s operating results, cash flow,
working capital requirements, debt and other factors Ampal’s Board of
Directors will deem pertinent.
4
Strategy| AMPAL
5
Major Milestones| AMPAL
1400
1200
1000
800
800
600
400
200
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 Q2 2011
Total Assets (Million US$)
EMG
Purchase
Smile 012
Purchase
Gadot
Purchase
Registration
For trade on
TASE
Smile 012
Sale
Energy
7
EMG | East Mediterranean Gas
§ EMG was established and registered in Egypt in
2000 and has constructed an off-shore gas
pipeline from El-Arish (Egypt) to Ashkelon (Israel)
as well as on-shore facilities.
2000 and has constructed an off-shore gas
pipeline from El-Arish (Egypt) to Ashkelon (Israel)
as well as on-shore facilities.
§ Egypt has undertaken to export up to 7 BCM of
natural gas annually for 20 years renewable to
Israel through EMG.
natural gas annually for 20 years renewable to
Israel through EMG.
§ EMG’s contracts with Israeli customers for
Egyptian natural gas may have terms of up to 20
years, with a total of 140 BCM.
Egyptian natural gas may have terms of up to 20
years, with a total of 140 BCM.
§ The gas flow to Israel began in June 2008.
§ At the end of 2010 EMG provided gas to Israel
Electric Corporation and Mashav at an annual
rate of 2.5 BCM.
Electric Corporation and Mashav at an annual
rate of 2.5 BCM.
§ During 2011, several incidents have interrupted
EMG’s gas flow, as detailed in the following slide.
EMG’s gas flow, as detailed in the following slide.
§ Due to the impairment of Ampal’s Investment in
EMG, the investment’s carrying amount of
approximately $361 million was written down to
its fair value of approximately $344 million.
EMG, the investment’s carrying amount of
approximately $361 million was written down to
its fair value of approximately $344 million.
EMG Profile
8
EMG | East Mediterranean Gas
• Beginning on February 5, 2011, the supply of gas to Jordan, Lebanon,
Syria, major Egyptian industries and gas consumers in the Sinai, and
to EMG and its clients, has been interrupted due to four alleged
terror attacks, on GASCO’s (the Egyptian gas transport company)
pipeline.
Syria, major Egyptian industries and gas consumers in the Sinai, and
to EMG and its clients, has been interrupted due to four alleged
terror attacks, on GASCO’s (the Egyptian gas transport company)
pipeline.
• On July 30, 2011, in the wake of violent incidents in El-Arish, Egypt,
there was an attempt to cause damage to the EMG site near El-Arish.
The security forces on site returned fire, prevented any penetration
of the EMG site and repelled the attack. EMG reports that the
incident will not affect its operations once EGPC resumes supply.
there was an attempt to cause damage to the EMG site near El-Arish.
The security forces on site returned fire, prevented any penetration
of the EMG site and repelled the attack. EMG reports that the
incident will not affect its operations once EGPC resumes supply.
• As a result of the continued interruption of gas supply to EMG and
the delivery of gas to EMG below contracted quantities, the
international shareholders of EMG, including Ampal, have
commenced procedures under applicable bilateral
investment treaties between several countries and Egypt. Such
procedures may ultimately result in arbitration of claims under the
various treaties, EMG’s gas supply agreement or other agreements.
Ampal has also been advised by EMG that EMG is considering
initiating arbitration proceedings against the government-owned
Egyptian gas supplier alleging a breach of various provisions of its gas
purchase agreement.
the delivery of gas to EMG below contracted quantities, the
international shareholders of EMG, including Ampal, have
commenced procedures under applicable bilateral
investment treaties between several countries and Egypt. Such
procedures may ultimately result in arbitration of claims under the
various treaties, EMG’s gas supply agreement or other agreements.
Ampal has also been advised by EMG that EMG is considering
initiating arbitration proceedings against the government-owned
Egyptian gas supplier alleging a breach of various provisions of its gas
purchase agreement.
EMG Pipeline - 2011 updates
§ Demand for natural gas in
Israel continues to
increase both for
electricity generation and
industrial conversions.
Israel continues to
increase both for
electricity generation and
industrial conversions.
§ EMG is one of only two
gas suppliers in Israel.
gas suppliers in Israel.
§ EMG contracted the
supply of more than half
of the natural gas
consumed by the Israeli
market
supply of more than half
of the natural gas
consumed by the Israeli
market
§ EMG is currently the only
company that can provide
additional quantities of
gas to Israel in the years
2011-2013.
company that can provide
additional quantities of
gas to Israel in the years
2011-2013.
9
EMG | East Mediterranean Gas
Natural Gas in Israel
§ EMG has access to Egyptian gas reserves
totaling in excess of 2,500 BCM from proven
diverse sources
totaling in excess of 2,500 BCM from proven
diverse sources
§ EMG has skilled and professional
management with decades of experience in
Egypt and its gas industry
management with decades of experience in
Egypt and its gas industry
§ EMG has already concluded several long term
contracts for the sale of over 90 BCM valued
at over US$15 billion
contracts for the sale of over 90 BCM valued
at over US$15 billion
§ EMG's estimated revenues (assuming
delivery of 7 BCM annually) - over US$ 1.0
billion
delivery of 7 BCM annually) - over US$ 1.0
billion
§ Estimated EBITDA (with provision of 7 BCM
annually) - over US$ 350 million
annually) - over US$ 350 million
§ Pipeline construction cost - approximately
US$ 460 million
US$ 460 million
§ Debt Balance - US$ 170 million
§ Due to current interruption in gas supply,
Ampal cannot determine the expected first
dividend from EMG.
Ampal cannot determine the expected first
dividend from EMG.
EMG
10
EMG | Signed Contracts & Options
BCM
11
Renewable Energy
§ GWE is owned equally by Clal and Ampal (50%/50%)
§ GWE focuses on the new development and acquisition of controlling interests in renewable
energy, including wind energy projects outside of Israel
energy, including wind energy projects outside of Israel
§ GWE seeks to either develop or acquire wind energy opportunities with a goal of
establishing at least 150 MW of installed capacity by the middle of 2011
establishing at least 150 MW of installed capacity by the middle of 2011
§ GWE currently has projects in Greece and Poland, which are in varying developmental
stages, with a total capacity of over 250 MW
stages, with a total capacity of over 250 MW
§ As of June 30, 2011, GWE has received a production license for 2 projects for a total
capacity of approximately 60MW wind farms, and 20MW photovoltaic projects, all in
Greece.
capacity of approximately 60MW wind farms, and 20MW photovoltaic projects, all in
Greece.
Global Wind Energy (“GWE”)
12
Renewable Energy
§ Production of Bio-Ethanol fuel from sugarcane
§ The Project includes the development of a 11,000 hectare sugar cane plantation
(Agricultural Project) and the design, construction and operation of an ethanol
production plant (Industrial Project). 10,000 hectares are already available for the
Project, including purchased and leased land.
(Agricultural Project) and the design, construction and operation of an ethanol
production plant (Industrial Project). 10,000 hectares are already available for the
Project, including purchased and leased land.
§ The Colombian government supports the development of the ethanol industry and,
since 2000, has adopted a series of measures to encourage the supply and demand for
ethanol and to create a regulatory framework to set prices, including the adoption of a
series of laws, decrees and resolutions to stimulate carburant alcohol production, sale
and consumption, and including the Colombian Law that stipulates mandatory 10%
blending of Ethanol for gasoline use in urban areas.
since 2000, has adopted a series of measures to encourage the supply and demand for
ethanol and to create a regulatory framework to set prices, including the adoption of a
series of laws, decrees and resolutions to stimulate carburant alcohol production, sale
and consumption, and including the Colombian Law that stipulates mandatory 10%
blending of Ethanol for gasoline use in urban areas.
§ Ampal holds a loan of approximately US$22 million convertible to 25% of the Project, to
be converted upon the first withdrawal from the financing bank.
be converted upon the first withdrawal from the financing bank.
Ethanol Project in Colombia
Chemicals
14
Gadot Chemicals Tankers & Terminals | Gadot
§ The leading Israeli company for chemical
supply and services to customers
throughout the supply chain of chemicals
from producer to end-user (mainly liquid
chemicals).
supply and services to customers
throughout the supply chain of chemicals
from producer to end-user (mainly liquid
chemicals).
Gadot Profile
Gadot Chemicals Tankers & Terminals | Gadot
§ Years of experience in storage, handling, packaging, transporting and
shipping hazardous materials.
shipping hazardous materials.
§ Provides services to the entire chemicals supply chain in Israel.
§ Geographic Areas of Activity: Israel, Western Europe, South and
Central America, USA.
Central America, USA.
§ Clients, including major Israeli companies:
Teva, Makhteshim, ICL, Palsan, HP and others.
Chemicals Field
16
Gadot Chemicals Tankers & Terminals | Gadot
Financial Highlights
|
US$ in Millions
|
Q2 2011
(unaudited)
|
Q2 2010
(unaudited)
|
2010
|
|
Revenues
|
139
|
118
|
497
|
|
Adjusted
EBITDA* |
9
|
6
|
26
|
*See EBITDA break-down on Appendix A
Financials
18
Condensed Solo* (unconsolidated) Balance Sheet (Pro-Forma) - June 30, 2011
* Including Gadot, Merhav Ampal Energy Holdings, LP and Country Club Kfar Saba on equity basis and not consolidated.
** Including a convertible loan of approximately US$22M to the project in Colombia.
|
Assets
|
|
Liabilities and
Shareholders’
Equity
|
||||
|
|
|
US$
(in Millions)
|
|
|
|
US$
(in Millions)
|
|
Cash, deposits and other
financial items**
|
|
134.3
|
|
Banks and Debentures
|
|
378.9
|
|
Investments
|
|
384.7
|
|
Accounts Payable and
Others
|
|
|
|
Fixed Assets
|
|
2.4
|
|
|
24.0
|
|
|
Other
|
|
45.9
|
|
Equity
|
|
164.4
|
|
|
|
|
|
|
|
|
|
Total
|
|
567.3
|
|
Total
|
|
567.3
|
19
Main Holdings - June 30, 2011
* Ampal’s Financial Statements reflect a 16.8% interest in the shares of EMG (approximately US$344M), which includes
the 8.6% interest in EMG held by Ampal’s joint venture with certain Israeli institutional investors, of which a 4.3%
interest in EMG (approximately US$88M) is attributable to the institutional investors.
the 8.6% interest in EMG held by Ampal’s joint venture with certain Israeli institutional investors, of which a 4.3%
interest in EMG (approximately US$88M) is attributable to the institutional investors.
** Due to the impairment of Ampal’s Investment in EMG, the investment’s carrying amount of approximately $361
million was written down to its fair value of approximately $344 million.
million was written down to its fair value of approximately $344 million.
Ampal’s
ownership %
ownership %
12.5%
100%
EMG*
Gadot
Other
Total
Book Value (US$
in Millions)
in Millions)
256.2
118.0
10.5
384.7
Method of Book Value
Cost (after impairment)**
Consolidated
Current Liabilities (excluding banks and
debentures)
debentures)
Current Assets (excluding cash, deposits
and other financial items)
and other financial items)
20
Condensed Consolidated Balance Sheet - June 30, 2011
Cash, deposits and other financial items*
Fixed Assets
Investments:
Other Investments
200.1
144.8
1,035.3
201.0
256.2
88.0
12.3
US$ (in
Millions)
Millions)
EMG (Ampal)
Gadot - Construction of Vessels
Capital Note - Institutional Investors in EMG
Other Liabilities (including minority rights)
96.0
1,035.3
46.8
107.3
14.3
US$ (in
Millions)
Millions)
Banks - Ampal
291.8
90.0
224.7
Debentures
Loans:
Equity
164.4
*Including a convertible loan of approximately US$22M to the project in Colombia
Other Non-Current Assets
45.0
Goodwill and Intangible Assets
87.9
Thank you!
9
1
8
6
*
6
22
Appendix A - EBITDA Break-Down for Gadot
* Less than 1.
Revenues
Expenses
Profit
Marketing, sales, general,
administrative and other expenses
administrative and other expenses
Depreciation and amortization
EBITDA
Non-recurring and stock
compensation expenses
compensation expenses
Adjusted EBITDA
497
(452)
45
(40)
17
22
4
26
Twelve Months Ended
December 31, 2010
December 31, 2010
274
236
139
118
(249)
(216)
(123)
(108)
25
20
16
10
(22)
(18)
(12)
(8)
10
8
4
4
13
10
1
1
14
11
Six Months
Ended June 30,
2011
(Unaudited)
Ended June 30,
2011
(Unaudited)
Six Months
Ended June 30,
2010
(Unaudited)
Ended June 30,
2010
(Unaudited)
Three Months
Ended June 30,
2011
(Unaudited)
Ended June 30,
2011
(Unaudited)
Three Months
Ended June 30,
2010
(Unaudited)
Ended June 30,
2010
(Unaudited)
23
Adjusted EBITDA is defined as earnings before interest, income tax provision,
depreciation and amortization, adjusted for non recurring expenses. Management
believes adjusted EBITDA for Gadot to be a meaningful indicator of its
performance that provides useful information to investors regarding its financial
condition and results of operations. Presentation of adjusted EBITDA is a non-
GAAP financial measure commonly used by management to measure operating
performance. While management considers adjusted EBITDA to be an important
measure of comparative operating performance, it should be considered in
addition to, but not as a substitute for, net income and other measures of financial
performance reported in accordance with Generally Accepted Accounting
Principles. Adjusted EBITDA does not reflect cash available to fund cash
requirements. Not all companies calculate adjusted EBITDA in the same manner,
and the measure as presented may not be comparable to similarly-titled measures
presented by other companies.
depreciation and amortization, adjusted for non recurring expenses. Management
believes adjusted EBITDA for Gadot to be a meaningful indicator of its
performance that provides useful information to investors regarding its financial
condition and results of operations. Presentation of adjusted EBITDA is a non-
GAAP financial measure commonly used by management to measure operating
performance. While management considers adjusted EBITDA to be an important
measure of comparative operating performance, it should be considered in
addition to, but not as a substitute for, net income and other measures of financial
performance reported in accordance with Generally Accepted Accounting
Principles. Adjusted EBITDA does not reflect cash available to fund cash
requirements. Not all companies calculate adjusted EBITDA in the same manner,
and the measure as presented may not be comparable to similarly-titled measures
presented by other companies.