Thank you for standing by, welcome to the OCI N.V. first quarter 2021 results conference call. At this time all participants are on listening mode. There will be a presentation followed by a question and answer session, at which time if you wish to ask a question you will need to press the star and one on your telephone keypad. I must advise you the call is recorded today, Wednesday the 5th of May, 2021. I would now like to hand the call over to Mr. Hans Zayed, Director Investor Relations of OCI N.V. Please go ahead. Thank you. Good afternoon and good morning to our audience in the U.S. Thank you for joining the OCI N.V. first quarter 2021 conference call. With me today are Ahmed El-Hoshy, our Chief Executive Officer, Hassan Badrawi, our Chief Financial Officer. As you've seen, we published our results this morning, and on this call we will review OCI's key operational events and financial highlights for the quarter, followed by a discussion of the outlook. As usual, we will host a question and answer session at the end of the call. As a reminder, statements made on today's call contain forward-looking information. These statements are based on certain assumptions, involve risks and uncertainties, and therefore, I'd like to refer you to our disclaimers about forward-looking statements. Let me hand over to Ahmed. Thank you, Hans. Thank you all for joining us today. I'd like to start, as always, by covering our top priority, which is safety, as we want all our employees and contractors to go home safe and every day. Our reportable 12-month rolling incident rate was 0.26 incidents per 200,000 man hours as of the end of Q1 2021. Our goal remains to prioritize process safety and to reduce operational incidents to zero at all our production facilities across the globe. Moving on to our performance during the quarter. We're pleased that we reported a record adjusted EBITDA, delivered our balance sheet at a fast pace and delivered our year-end net leverage target early by achieving it already at the end of March. This performance was especially driven by the significant and sustained improvement in fundamentals of our end markets, combined with our strong focus on operational performance at all our plants and the great execution of our commercial team in capturing significantly higher selling prices as we stick to our commercial strategy and maintain the disciplined sales approach. I'd like to thank all our employees for their continued dedication to OCI and its values. Our sales volume increased 9% to three million metric tons during Q1 2021 compared to the prior year. In particular, we had another quarter of strong performance in methanol, as we recorded an increase of 27% in own produced methanol sales volumes in Q1 2021 compared to the same time in 2020. This was driven by a significant step up in production at OCI Beaumont and BioMCN, as our methanol facility in the Netherlands continued to achieve steady utilization rates in both production lines and reached record levels during the first quarter of 2021. The extreme cold weather and spike in natural gas prices in the U.S. in February and early March resulted in downtime at OCI's U.S. plant, the impact was meaningfully more than offset by cash gains from physical and financial gas hedges, as you saw in our results. With that, I'd like to turn it over to Hassan to discuss the financial results in more detail. Thank you, Ahmed. I'll briefly cover some key highlights of our financial results as usual, starting with the P&L. Our consolidated revenues increased by 38% to $1.12 billion. Our adjusted EBITDA rose by 134% to a record $452 million in the first quarter of 2021 compared to the first quarter of last year. Our adjusted EBITDA margin also improved considerably from 24% in Q1 2020 to 40% in Q1 2021. This performance underscores the benefits of our diverse stream of global revenues and our competitive position on the global cost curve with a young asset base and strategic locations. With around half of our total gas requirements emanating from assets with fixed gas price regimes. In the current pricing environment, the competitive advantage of Fertiglobe's assets becomes more evident. To bridge adjusted EBITDA from the first quarter of 2020 to the first quarter of 2021, there are three factors I would like to highlight. First, the biggest driver of this growth was the improvement in market backdrop, as Ahmed already pointed out and will be discussing in more detail later on in the call. Selling prices improved across the board in the first quarter as well, compared to both the first and the fourth quarter of 2020, with increases ranging from around 15%-65% across our various commodities. Despite the impact of downtime in the U.S. and in Europe during the unprecedented U.S. winter freeze and the result of spiking European gas prices, our total sales volumes also continued to increase and were up, as Ahmed mentioned earlier, 9% year-on-year, with sales and production volume growth in both the nitrogen and methanol segments, signifying our continued improvement in operational performance. Although the prices of our key cost input, natural gas, were on average higher for the group in the first quarter of this year compared to the first quarter of 2020, especially in Europe, we made cash gains in the U.S. to the tune of around $75 million-$80 million. The total net impact from natural gas outside the gain, considering the negative impact of the higher gas prices, amounted to around $40 million-$45 million. In terms of our segment results, I would like to highlight Fertiglobe, which achieved revenue growth of 50% and adjusted EBITDA increases of 105% compared to the first quarter of 2020 and 56% compared to the fourth quarter of 2020. Fertiglobe's competitive position improved significantly with European gas prices normalizing at higher levels, which resulted in adjusted EBITDA margin improvement from 31% in Q1 2020 to 43% in Q1 2021. Important to point out that Fertiglobe has completed the realization of the target synergies, post consolidation of Fertil in September 2019. The commercial performance has been especially visible on the ammonia business, where a disciplined approach to the market has optimized our net backs and the financial results of the business in this current market environment. With excellent free cash flow conversion, we expect healthy dividends from Fertiglobe in 2021 and on a continuing basis. Highlighting the Methanol's group adjusted EBITDA was also significantly higher in Q1 2021 compared to the same quarter last year, due to a healthy increase in production volumes, the continued growth of our fuels business and higher methanol prices, which all combined have offset the higher gas prices in the Netherlands compared to a year ago. EBITDA margins excluding gas gains for the Methanol group more than doubled between Q1 2020 and Q1 2021 to over 30%, which also represents a healthy margin growth of more than 13% at BioMCN, despite the high gas price environment in Europe. Turning to the balance sheet and our cash flow performance. As a result of our improved performance and record EBITDA during the quarter, we generated healthy operating free cash flow, and as a result, we were able to delever a further $306 million during the quarter, resulting in a net debt position of $3.4 billion as of the end of Q1 2021. Free cash flow before growth CapEx amounted to $346 million during the quarter, underlying the strong free cash flow conversion. Total cash capital expenditures were $57 million in the first quarter, down from $96 million in Q1 2020. We continue to guide for $300 million in total CapEx for the full year. We have achieved substantial improvements in our cost of debt over the last two years, with our weighted average cost of debt reducing from approximately 6% at the end of 2018 to close to 4% today, while maintaining progress on our capital structure simplification and reductions in gross debt. We have consistently prioritized free cash flow for deleveraging to progress to our long-term balance sheet target of 2x through the cycle, with leverage reducing in the last five quarters from 5.4x-3x today, which is the target we had for ourselves for year end, we now achieved early. The expected strong performance of the business in 2021 and excellent free cash flow conversion will allow us to continue to progress towards our target capital structure and expect further reductions in gross debt, leverage and the weighted average cost of debt over the course of this year. Achievement of our target capital structure remains a priority as this will allow OCI the flexibility to consider exciting growth opportunities in the evolving hydrogen economy as well as shareholder returns in the future. We continue to proactively optimize our balance sheet. For instance, we recently repaid $147 million of 5.875% bonds with IFCo and $100 million of our 5.25% and 4.625% bonds with N.V. This will deliver additional interest cost savings of $10 million per annum on an ongoing basis, while creating repayable debt of future positive free cash flow inflows. We also expect a significant step down in the margin of our core $850 million revolving credit facility of at least 175 bp s to take effect in Q3 2021 as a result of the deleveraging profile of the group. We will continue to evaluate opportunities to achieve similar objectives and further simplification of our capital structure on an ongoing basis. Briefly, just wanted to also mention that you may have seen the news that we are considering an IPO of Fertiglobe, our 58/42 partnership with ADNOC. We can confirm that we have started preparations and we are in early stages of that process, and we continue to provide updates as appropriate throughout the year. With that, I would like to hand over to Ahmed for our markets outlook and group strategy. Thanks, Hassan. I'll discuss our outlook and some more exciting recent developments and achievements in our ESG strategy. The outlook for OCI remains positive for Q2 and beyond, supported by strong underlying demand for nitrogen fertilizers, driven by healthy farm economics and a continued recovery in our industrial markets for ammonia, methanol, melamine and DEF. Let's start with the outlook for nitrogen markets. Global nitrogen prices have recovered from trough levels reached in 2020, with prices rising 50% in Q1 2021 and a further increases of 15%-30% to date in the second quarter. These price increases are underpinned by healthy agricultural fundamentals. We have seen a steady increase in corn prices over the past few months to eight-year highs, driven by strong corn imports from China, declining global corn stock-to-use ratio and rising farm income, supportive of farm economics and as a result, nitrogen demand and prices. Crop conditions also remain behind prior years amid ongoing drought conditions in key growing areas such as Brazil, and are contributing to the increase in crop prices. U.S. corn acreage in the 2020/2021 season is expected to be 92-93 million acres. With the relationship between the new corn soybean ratio now strongly favoring corn, we expect a further increase in corn acreage in the next fertilizer season, supporting higher 2021 U.S. nitrogen prices even in the off-season. The higher crop pricing is also supporting strong demand in Argentina, as imports in Q1 2021 were 80% higher year-over-year, and a further one million tons is expected to be imported over the June to November period, benefiting our operations in Fertiglobe, in particular as Egypt benefits from a 6.5% duty exemption and advantage in this market. Higher fertilizer demand in China on strong domestic crop prices and the shift towards nitrogen-intensive corn as animal feed, combined with the recovery in industrial urea consumption in the country, is also expected to likely limit urea exports from China in 2021 to a level that is lower than what we saw in 2020. Robust import demand in Latin America, Australia, and India is driving a healthy increase in Fertiglobe's urea volume as well in Q2 2021. In Europe, we expect strong demand on improved farm incomes and low nitrate inventories across all European producers to drive tighter market conditions into the second quarter of 2021 compared to the prior year. In the U.S., UAN inventories are low, and we believe many producers have sold forward in the first part of Q1 well into the second quarter, resulting in limited availability of spot product. Our U.S. Midwest operations are therefore benefiting from a combination of higher sales volumes and prices in the second quarter following our Q1 production hit, which resulted in lower volumes. To summarize, given low inventories coupled with high feedstock costs in Europe and grain prices at eight-year highs, this helps create an environment for a more muted seasonal reset in pricing compared to what we've seen in prior years. Switching to the industrial side. We're benefiting from a strong rebound in all major global economies and in many sectors with forecasts for global growth of more than 5% this year and almost equally strong for next year. This gives us good visibility on our end markets that will boost demand for methanol, melamine, and ammonia, which are used in many downstream products across various end markets, including but not limited to, of course, construction, automotive, textiles, plastics, you name it. Furthermore, the recovery in transportation applications increasingly bolsters demand for our products, keeping market conditions tight. Starting with ammonia markets. They've been buoyed by a structural tightening in the last few months, as we've all seen with the recovery in industrial demand, as well as gas supply curtailments and outages in Trinidad, combined with the fact that on the medium to long term, we see no major merchant ammonia capacity additions expected till 2023. OCI's DEF sales in the U.S. also reported another strong quarter in Q1 2021, with truck sales up sharply and the SCR-equipped vehicle fleet at a record high, which combined with the higher urea sales prices, supports an improving trend for Q2 as well as the balance of the year. melamine markets have also tightened, driven by a rebound in demand from home renovation and construction in Europe and the U.S. market. We've seen the melamine quarterly contract prices increase to a decade high in the second quarter, which has already been signed off. The second quarter is also developing positively for our methanol business, as market conditions also remain tight. We've seen increases in the May contract price, as announced last week, and which provides good visibility on our sales and prices out of the U.S. in Q2. Obviously the European contract price is set quarterly, and that was set for all of Q2 late in March. What are the drivers of that? We see demand recovery continuing in the U.S. and European core markets, driven by demand from the end markets I discussed earlier. In China, we're seeing high utilization rates on the MTO side, where the outlook continues to be robust. We're also seeing increases in demand for fuel applications as lockdowns come to an end. I mean, this is an important point that we raised on the last call that we think that that area has not still recovered to pre-pandemic levels in terms of methanol and gasoline blending, and then obviously for our biofuels blending into the renewable fuels market. Second, global inventories in methanol are low as demand continues to recover strongly and new supply has been delayed. I'd like to also give an update on our ESG initiatives since our Investor Day in early March. As we discussed then, ammonia and methanol are the best-positioned products to create low carbon and carbon-free food, fuels, and industrial feedstocks, and therefore can help decarbonize a wide range of end markets and industries. We continue to prioritize high impact, no to low CapEx initiatives that achieve financial returns in a short period of time while also decarbonizing. As you may recall, 45% of our GHG reduction commitment is zero to low CapEx, including accelerated operational excellence and the switch to renewable energy. I'd like to reaffirm our guidance that the Operational Excellence Program, which includes higher off-stream times, less start costs, and better efficiencies, is expected to yield at least an additional $75 million per year EBITDA annually over the next three to five years. We believe this number can be materially higher than that with the higher selling prices we're seeing. As discussed, OCI is uniquely able to decarbonize while generating positive cash returns, which is fundamental to our strategy and our course. We are pleased that we've also made good progress in continuing to expand our offering of low carbon products to our customers. We recently signed one agreement and one letter of intent with two major industrial gas companies for the supply of low carbon hydrogen to OCI Beaumont in Texas. This will enable us to produce blue ammonia at the plant up to its full ammonia production capacity of 365,000 tons starting later this year. Decarbonizing the feedstock supply will be one of the main avenues our customers can benefit from to decarbonize their own footprints and a crucial way for them to achieve their own targets. This is even more pertinent at OCI Beaumont, which is strategically located in Texas, in the center of one of the largest hubs for potential for blue and green ammonia customers in the United States. It has a large customer base that is not only in the industrial feedstock space, but also fertilizers, where Texas is also a major foreign producer, and also future marine demand, and we're in close proximity to Houston, one of the four major global bunkering hubs for shipping. I'd also like to highlight our fuels business. As our fuels business is growing and has large-scale potential for maritime and road transport in the future, we've established a new business unit, OCI Clean Fuels, which focuses on sustainable fuels. It includes our current and fast-growing biofuels offerings of both bio-methanol and bio-MTBE, among others, as well as the future use of ammonia and methanol for shipping and other fuel applications as we accelerate the transition to producing blue and green ammonia at our plants. The use of ammonia and methanol as a shipping fuel is particularly promising, as these products are among the best-placed alternatives to help the sector decarbonize and reach IMO targets in a cost-effective way. Since our March update, several new announcements and studies are materializing in the shipping sector, including major ship owners, engine manufacturers, and ports, all endorsing the use of ammonia and methanol as the shipping fuels of the future. For example, as you may have seen, Wärtsilä a leading global shipping engine manufacturer, has underscored methanol and ammonia as a more credible fuel than hydrogen to power ships. Maersk, one of the largest container shipping companies in the world, announcing the launch of its first line of vessels operating on carbon-neutral methanol in 2023, which is seven years ahead of initial 2030 ambitions. We see tremendous momentum building up from ESG that has resulted in many tangible opportunities at almost all our global sites. They're all quite interesting, and we're evaluating them across all the various sites and across the global OCI team. This exciting momentum around our ammonia and methanol business as enablers of the hydrogen economy has also influenced our strategic review of the methanol business. Along with the accelerated strengthening of our balance sheet, market conditions for methanol have improved considerably since last year, and the outlook remains positive. All of this has shifted our focus of the review to potential partnerships of strategic nature rather than a full divestment. These partnerships of strategic nature would facilitate an acceleration of our growth for our green fuels business overall. To conclude, we believe that based on the current visibility on volumes and pricing, we expect a stronger second quarter with higher adjusted EBITDA than in Q1, and we see 2021 as a year of free cash flow growth and deleveraging. We are now seeing the strongest nitrogen and industrial markets that we have experienced in years, with the robust underlying fundamentals supporting our medium to long-term outlook. Against this background, and even more broadly, our unparalleled asset base, coupled with our dynamic team, are uniquely positioned to achieve our exciting ESG growth agenda while maintaining our relentless focus, as always, on shareholder value. With that, we will open the line for questions. Thank you. As a reminder, if you wish to ask a question please, press star and one on your telephone keypad and wait to announce your name, if you wish to cancel your request you can use the hash key. Once again press the star one if you wish to ask a question. Your first question today comes from the line of Christian Faitz, Kepler. Yes. Thank you. Good afternoon, Ahmed, Hassan, and Hans. I have a couple of questions, please. I'll ask them one by one. First question would be: Can you confirm that the Texas freeze impact is completely solved, i.e., there's no Q2 impact anymore from any supply chain issues, et cetera? Thank you. Yes. Thanks for the question. Yeah. The Texas incident or the U.S. freeze incident happened in February. It affected our production in February. As we mentioned, we had the U.S. plants all down during that time. We don't see an impact in Q2 related to Q1 event. Okay. Great. Yeah. Second, on your cash flow evolution. First of all, congrats on that. Given the much-improved business momentum, I would have expected a higher negative working capital move. You seem to be mentioning your receivables, but also your payables are up, though. Inventories also hardly moved up in the balance sheet. Can you comment on that? Yeah. You're saying you would have expected to see a working capital cash outflow given how much EBITDA we generated? Yeah, indeed. Better business momentum typically leads to higher working capital outflow. No, it's a good point, but part of it has to do with the fertilizer season. Sometimes, in late Q1, as you have some shipments, you get prepayments from investors for Q2, from investors, from customers, from Q2. There is some prepayment activity in Q2. Also, I think the team's done a tremendous job on receivables, and we've seen the gas impact, for example. From a gas perspective, we got the gas payments in Q1 as well. That helps support the working capital in the business. We also have a very efficient and low-cost equalization program that helps in ensuring the best sort of monetization possible, and the reduction of the fluctuation of working capital. That doesn't mean, of course, that we will not continue to see as during certain quarters, some fluctuation in working capital, including outflows, but that is something we manage as best as we can. Sure. Again, congrats on that. Last and final question, please. Can you elucidate the rationale for the potential Fertiglobe IPO? Would that still then fit with your global strategy of ammonia/methanol for shipping? Would that be still part of your global network? You talked about that on your ESG day in March. Maybe I'll take the first question and then defer to Ahmed on the second question. On the IPO rationale, there's not much we can say at this juncture, as you can appreciate. However, Fertiglobe will become our vehicle for future growth outside North America and Europe, given the strategic location of the assets and its competitive cost structure, which becomes, as I mentioned during my earlier speeches, more evident when gas prices are higher across the globe. Ahmed also can comment on the positioning of the assets geographically. We think the IPO will help crystallize the value of this underlying business in the future. That's all I can say at this point. Yeah. Okay. I think Hassan touched on it well, with regards to just the Fertiglobe asset base, it was a major part of our ESG day in early March. We discussed the location of the assets, the fact is that we think from a value perspective, it's an interesting platform overall. It has very good access to the Suez market as well as the Fujairah market in terms of the bunkering opportunity for shipping, as you've said. The fact that we have ammonia plants in three different countries is very helpful. When we think about the push towards new projects and new concepts and the fact that we have very attractive renewable energy potential across the Fertiglobe platform. When we have renewable energy, we have an ammonia plant, we have ammonia storage and loading infrastructure, we have the ability to export, and then we have the European import capabilities for ammonia that OCI has as well. When we think about all of that, all we need potentially is just bringing in and slotting in somebody to produce renewable hydrogen from renewable energy and giving us the hydrogen offtake on a long cash basis. We see a lot of growth initiatives that can be enabled by an IPO of this type of business. As Hassan said, we can't get into too much detail today. Okay. Thanks a lot, Ahmed and Hassan. Thank you. Your next question comes from the line of Thomas from Citi. Thanks very much. Tom Wrigglesworth from Citi. Couple of questions from me. Just following up from Christian there. Natgasoline, if you hadn't had the interruption, based on the prevailing prices, what do you think would've been a reasonable contribution to EBITDA from Natgasoline? Just to give us a sense of how much that could contribute in 2Q. Secondly, China exports. I noticed that you're still expecting Chinese exports to be in the 4.3 million tons for 2021, down year-on-year. What's your conviction in that number? There's quite a lot of debate about China picking up exports. I'm quite keen to gain your insights there on that. Lastly, just going back to methanol, U.S. Chinese methanol spreads are quite wide. U.S. price seems quite high, and you're quite bullish. Are you expecting the Chinese methanol price to track back higher at this point rather than weigh on the U.S. price? Thank you. Thanks a lot for the question. I'm not going to be able to give you an exact bridge on the Natgasoline side, in terms of the exacerbation that was caused by the freeze. Say that, just looking at Q2 versus Q1, obviously we see better average pricing, right? We see from a volume perspective, obviously with the production, higher volumes. I will say that, in terms of the gas gains that we said, that $75 million-$80 million net gas gain, not that much of the gas gain was in Natgasoline. That gives you a little bit of a sense around Q2, just directionally, wouldn't be able to comment too much further on that. Your second question, trying to keep track of it here, was around Chinese export. As we discussed briefly in the prepared remarks, it's the technical urea demand that we're seeing continually step up with the industrial activity recovery in China. It's the ag demand in China. One of the major drivers of this recovery in the ag cycle has been this Chinese corn buying we saw last year, and we anticipate even significantly more Chinese corn buying this year. Also a changing approach from a demand perspective for nitrogen because as the feedstock with the trade war that we saw, during this prior administration, soybeans, which was a major export from the U.S. to China, started getting replaced with the use of corn. Chinese are going to be looking to plant more corn, which is more nitrogen intensive. We think that that's another area of latent demand that's going to be helpful as well. Lastly, India is clearly going to be highly dependent on China. India needs to import several million tons by, I think it was four or five million tons by September, right? Or six million tons, sorry, by September. They're going to have to take a lot in this tender that's going on right now, but they're also dependent on their plants running well. We've seen some issues in startups in year to date on the Indian side and reliance on their domestic production. Domestic production hasn't been doing so well. We think China's going to have to be there and supply the Indian market as well. Overall, we do think that this year will be lower than last year in terms of exports. We'll see. We're still not yet halfway through the year, but a lot of favorable demand-side drivers behind that. Your last question, I believe, was on methanol and the spread between the U.S. and China market. We've seen that for some time. Obviously, we have new capacity coming online in the Atlantic Basin, we've seen continual kind of start-stops on the Trinidadian supply side. We've seen plants and guidance from some of our peers around production rates fluctuating. That's a major part of the Atlantic Basin, which has caused the need for tons to flow into the Atlantic Basin at times to satisfy those higher prices. I think it's partly that, and it's the timing of new starts which we think the new capacity addition probably comes online probably later in the summer rather than earlier in the summer, just given what we're seeing in activity on the methanol side. Also usually we've seen kind of start-stop plants start up. Also we see on the Chinese side, yes, Chinese prices are a bit above the marginal cash cost floor despite coal going up. They're still a long ways away from the affordability rate that people are able to pay for on the MTO side. We see healthy demand on the MTO side with the forward curves on olefins continuing to look robust. That gives us some more conviction on the ability for Chinese prices to stay supported. We do need to just look at this lumpy supply as it comes onto the global markets, and we're hopeful that the demand can continue to absorb that the demand growth we're seeing. Thank you. Just one more follow-up. Do you think it's possible that there's enough optimism around crop prices and the strength that you've indicated towards next season as well in 2022, that effectively the producers of nitrogen fertilizers will resist any summer lull in prices? I think that if there's going to be a year to see that, this would be the year. What we've been seeing was a very tight market that we just haven't seen here, both for urea as well as UAN, a good run here on ammonia that we've seen in the U.S. The inventories haven't been this low in a long time, and you have corn at a high level, and we're seeing even demand for seed corn. We've been hearing it's quite high. We think a lot of demand will occur. We've seen some cooler weather in the U.S., which has pushed out a little bit of what we expect on the germination of plants. We think that side risk can be pushed and extended into July. You see the best way going into Q3 rather than stopping in Q2, which is very helpful. There's not a necessary reason that you have to have a big reset in price. We think that it could be much, much more muted versus prior years and not have to offer that up. On the European side, I think it's similar. We're already seeing good AN prices in the market. On the CAN side, we're also pretty hopeful that particularly with the higher European gas price we're seeing now, that we should see muted and little decreases because people are looking one year out. Farmers are looking one year out and are concerned around the inflation in crop input prices and seeing maybe going into next year. Thank you. Very helpful, color. Much appreciated. Next question comes from the line from Faisal Azmeh from Goldman Sachs. Yes, hi. Congratulations on the strong set of numbers and thanks for the opportunity to ask questions. Two questions on my side. Maybe firstly, when we're thinking about the potential IPO and the proceeds from the IPO, given the de-leveraging process that you've already achieved so far and how you're progressing, what potential uses for the proceeds do you have in mind if the IPO takes place? We're just trying to get a sense of cash deployment options should the balance sheet condition improves. My second question is really on the supply side of the equation. You've highlighted a few points on demand, but when thinking about Nigeria and some of the larger facilities that were supposed to come online, what are you hearing? What are you sensing in terms of their ability to bring that capacity online on time, and how does it impact the market? Thank you. Maybe I'll take the first question and defer to Ahmed on the second question regarding the new facilities, I assume urea facilities you're referring to. On the IPO proceeds, again, very early on in the process. We continue at N.V. level to be committed. To optimizing our capital structure and getting to an investment-grade profile through the cycle. It is logical to think or to assume that in the event of such an IPO taking place, that the proceeds from this IPO would continue to contribute to this target and just create more flexibility in our decision-making going forward, looking at various avenues of deployment. The priority continues to be, of course, getting our balance sheet to where we want it to be comfortably on a run-rate basis. Ahmed, I defer to you on the matter. Yeah. I'll just add, I think one of the major things that I think has been a success has just been the decrease in interest expense that has still a long ways to go. We really want to bring down that interest expense so that we can achieve some EBITDA free cash flow bridge, which we think can be quite exciting for OCI specific. Can you repeat the question, based on with regards to, did you say Indian and Nigerian custody? What was the question exactly? Generally, on the supply side, when looking at some of these newer facilities that were supposed to come online, what are you gauging in terms of their ability to bring that capacity online? Do you feel that the market is experiencing further delays, or do you see these facilities coming online at some point, and how do you assess their ability to impact the pricing in the second half of the year? Yeah, we're no strangers to delays in construction projects on new builds. It's a tough process. As I mentioned, I think previously, particularly in COVID, makes it very difficult. We continue to see delays on some of these urea capacity expansions. We did see, I think, a plant come online in India that has had issues already. I think the Ramagundam plant is probably supposed to be down, I think, until the first of June. That obviously impacts some of the demand that India is going to need for the next tender or for this ongoing tender. With regards to Nigerian capacity, that project continues to be delayed. We think that now that it's started commissioning, we've heard of some issues on the commissioning side as well as delay in completion of port infrastructure, which means that it'll probably be more affecting the domestic market rather than the global market. Obviously something to monitor, something we look at, something that our Fertiglobe urea team is actively focused on and at times could potentially be a distributor for some of these producers as they come online and has been building up its capabilities to do it in a highly effective and low-risk way to place product in the various downstream markets that we look to place our product in. Maybe if I could just squeeze another question. Just on the partnerships on the methanol side, are you in advanced stages or early stages in terms of negotiations, or how can we think about that? I can't go into too much. I can't really comment on that at all, but just say and reiterate what we said earlier, which is that we don't see this as a financial positive type investment. If we do entertain something like this, it would be strategic in nature, whereas we get value out of that strategic partnership or investment from somebody strategic that can help us accelerate the growth trajectory we're already on from an ESG perspective when it comes to methanol and overall clean fuels. That's really the focus here. Obviously, if there's any updates, we would provide them. Thank you. Thank you. The next question is from the line of [Henk] Veerman from Kempen. Hi, good day, everyone. Thank you for taking my questions. Congrats with the strong start of the year. I have three questions. The first one is on Fertiglobe, which was probably your best-performing division this quarter. You, again, did not pay out a dividend to your non-controlling shareholders. Can you remind us what the total dividend accrual was at the end of the quarter? Can you give us any idea on, let's say, the size of dividend payments for the next quarters? My second question is on the capital allocation. I was wondering because you're now at 3x net debt to EBITDA. Let's say excluding any effects from a potential IPO of Fertiglobe, I think you will materially go below 3x net debt to EBITDA towards the end of the year if the season progresses as expected. Can you then already pay out, or will you consider paying out a dividend over 2021, next year, or is, let's say, the 2x a very sort of hard target? My third question is on the methanol partnership, more of a follow-up. I was wondering will you sort of pursue a sort of partnership where you have a majority ownership, similar to the Fertiglobe partnership, which allows you to fully consolidate or continue to fully consolidate the methanol business, or is, let's say, more of an equity accounted structure more preferred? Thank you. Thank you for the questions. Maybe I'll kick off with answering the first two. The first, Ahmed, on the methanol strategic partnership question. In regards to your first question, it's true it's not obvious in the financials, but we don't give specific information on the season advance on the dividend extraction. What I can say is that the free cash flow conversion profile of Fertiglobe allows for very healthy dividends on an annual basis, and we believe on a continued basis. The timing of that may not be, let's say, normalized on a quarterly basis. We did take out a dividend, for example, on the 1st of April from Fertiglobe, which just didn't appear in the financials. Secondly, in terms of your second question, it's true, we did achieve our net leverage target 3x early. We had set the target for ourselves several months ago. Given that we are guiding for further deleveraging in Q2, and we continue to see good fundamental backdrop in both our nitrogen and methanol markets for the remainder of the year, I think the combination of those variables would indicate that our deleveraging trajectory should continue in a healthy manner. We are not giving any further guidance at this point of what the exact number is, but I think it is not difficult to deduce the direction of travel. Ahmed, would you. Just the second part of your question regarding the 2021, whether we will consider returning capital to shareholders. Again, as we continue to focus on achieving our sort of balance sheet optimization targets, I think all options are on the table in terms of the deployment of our free cash flow. We think the fact that this year and next year are important years in terms of our deleveraging, that this gives us the flexibility to look at various avenues for our free cash flow deployments. Just to add to that last question. Thanks, Hassan. Just to answer that question in terms of the form of the partnership, I think we wouldn't really be able to comment on what that would look like. I would say that just generally, with what Hassan mentioned earlier, and I think we mentioned on the prior call, the fact that we've delevered significantly, versus where we were when we started the strategic review, as well as the improvement in supply-demand for methanol that we've seen. The continued outlook where over the medium to long term, demand continues to outstrip supply. Third, and last but not least, is the ESG profile. We want to continue to have good skin in the game on the methanol side. Our whole focus is to try to get enough resources and kind of overall achievability of creating the value that we think underlies our methanol and ammonia commodities. On the methanol side, like I said, we're in London right now, still pretty much in lockdown. All going to be released in kind of a week or so. We think that the second half of the year should be great for our biofuels business that hasn't had that benefit, and we think that things are trending in the right direction overall for methanol as a road transportation fuel, for methanol as a feedstock, and for methanol as a shipping fuel. We still want to have a big part of that business going forward. That's why we gave the update on the strategic guidance today. Okay. Thank you. Thank you. Next question comes from the line of Frank Claassen from Degroof Petercam. Please come. Yes. Good afternoon. Two financial questions left. First of all, on the profits you made on the gas hedge, the $75 million-$80 million. You've already indicated limited for Natgasoline, but could you roughly break down how much was for Beaumont and how much was for Iowa? That's the first one. Then secondly, given your strong deleveraging, could you update us on how much lower your interest charges could be in 2021? Thank you. I don't want to go into too much detail. I would say just it had a bigger impact on Beaumont and ESCO rather than Natgasoline, and Natgasoline Q2 does look stronger materially than Q1. To split it out between Beaumont and ESCO, we just provided the net amount across the plants. I wouldn't be able to give you a breakdown between each of those. Yeah. On the interest cost guidance, I think similar to what we covered briefly during the last conference call, we continue to guide for $60 million-$70 million lower than 2020 in terms of cash interest. That excludes debt modification costs, which, as you know, was part of last year's numbers. This year will depend on what capital structure activities we undertake in the balance of the year. In terms of sort of run rate, $60 million-$70 million lower. We still think that this should continue to decrease in 2022 and onwards as we find opportunities to reduce our interest costs. We talked about the step-down on RCF on an annualized business. We have some callable bonds, which will also help eventually reduce some of our expensive debts to reflect the evolving profile of the business and reflect the sort of the cash flow generation that we're experiencing in this year. Okay. Thank you very much. Thank you. Your next question comes from the line of Lisa De Neve from Morgan Stanley. Hi, good afternoon. Congratulations on your very strong performance in the first quarter. Two questions. The first one is on UAN. What are you seeing in U.S. UAN markets? It seems that it has been very strong so far year to date, but I also read there's quite some risk for incremental imports from Russia. Just wondering what your expectations are for the second quarter and the rest of the year for UAN and what you're seeing. That's the first question. Secondly, going back to earlier questions on the divestment of the methanol business, and I'm really sorry for bringing this up again, but what I'm interested in is, what type of partner would be valuable to you? Or in other words, what would you consider as a value-added contribution from a partner's perspective? Perhaps something on the ESG side or something. I would be more interested to know what a partner could bring to the table for you and what would be of your interest. Thank you. Sure. With regards to your first question, yeah, we've seen a fairly strong market. We've actually seen inquiries, even this week we're hearing inquiries on Q3 bids from customers that weren't too far below where some of the markets are at today. Like I said earlier, I think that low inventories, high spot prices are getting people concerned around, okay, what's next year when you're seeing this corn to soybean ratio looking favorable? Your question on Russia is a good one, and I think that's always something we have to focus on because of Russians selling into the U.S. market. There's a few other things going on, which is one, people look at going potentially into Europe still as well. We've seen sanctions on the Belarusian production side affecting the supply and demand of UAN into Western Europe. I think right now it's not a very high period of activity for UAN, but we think that there's still some movement upwards on the European side for UAN, which bodes well for that arc between Europe and the U.S. And we've seen Russians produce a bit more urea instead of UAN, and have a stronger domestic market in the past. We've seen obviously, the reliance there, as I mentioned, on Trinidadian UAN coming in as well. There are a few different elements at play. I think one advantage that U.S. producers have is the infrastructure that is in place in terms of storage and rail cars and customer relationships and all the above. I think we have to continue to watch for the Russian imports because they do and they have come in. We have to look at the global supply-demand balance and also what the starting inventories will be this year. I will also mention that we do think that there are more turnarounds in this nitrogen market in the U.S. in 2021 versus 2020. We think a lot of turnarounds have been delayed, which is supportive for S&Ds, particularly during the low periods. That's on the UAN question. Your second question was with regards to the partner. I think it's all we'd say that would be something that would be strategic in nature that adds value, not financial. In terms of giving detail around it's one where if you were to think about the trajectory that we talked about in the last few months that we want to achieve, which is low carbon feedstock, to get a very valuable decarbonized methanol as an industrial feedstock and as a fuel like we're seeing on the ammonia side as well. We think that's very powerful. As I've stated a few times, many companies globally are getting the push towards setting out decarbonization targets. How are you going to reduce your carbon? You're going to go back to where was the carbon produced, it was often produced very close to hydrocarbons, which are natural gas, oil and other feedstocks. Our ability to have lower carbon feedstocks like we've now shown that we've been able to do in OCI Nitrogen with green ammonia in our biomethanol business globally and in our blue ammonia out of Texas. It's about finding and putting the puzzles and pieces together to get further distribution downstream and/or lower carbon feedstocks upstream so that we can accelerate our push, and create that shareholder value in monetary terms while decarbonizing and achieving our targets for the balance of the decade. Thank you. That's super helpful. Thank you. Your next question comes from the line of Adrien Tamagno from Berenberg. Hello, good afternoon. One question concerning the Beaumont plant in Texas. The volumes you indicate for blue ammonia imply 100% of capacity. Can you comment a bit around the timetable and when you expect to reach such capacity? Side question, how should we think about CapEx from 2022 onwards? With regards to the blue ammonia capacity, obviously, we're very excited to now have the ability to have a decarbonized ammonia product for the food, the fuel, as well as the feedstock chains. Our goal is working with our customer base now that we have this offering, and like I said, it starts later this year to be able to convert 100% of our production into blue, to figuring out how to get that distributed downstream and doing it in a way that's a win-win for ourselves as well as for the customer base. We're working on it as we speak now with the customers. Most importantly, we have the ability and the options to switch into blue ammonia, which we think is on a relatively attractive basis. Okay The other question was with regards to CapEx. Yeah. Your question was what, sorry, on the CapEx side? Yeah, if that would have an impact on 2022 CapEx, but that seems to. This is one of those examples of no CapEx initiatives. We'll load a no CapEx initiative to decarbonize, while kind of achieving financial targets as well in the process. Like I said during our ESG day, we're looking at that big portion with the low-hanging fruit, and this is one of the areas and an example of some of the low-hanging fruits that we're looking at to decarbonize and significantly reduce our footprint while also creating value without having a big CapEx outlay. Yeah. Understood. Second question on the nitrogen supply, do you see room for Iran to have a further participation in urea exports? Or you think the bulk of this growth is already behind us? We've seen Iran continue to participate in various markets on the urea side. They've definitely not disappeared. They just reallocated some of where the product was going. One of the areas they were going previously was India, but they've now gone to exhaust many other markets as well. As we said before, we're going to see how things play out on the Iranian side, but we think that it puts Iran in a very tough position when they're exporting and they're having to put effectively dump prices to use clandestine measures to get product from their source to a destination that doesn't want to do this in a straightforward way. We think that to the extent they're able to sell, not just for a fraction above marginal cost, which at times they've done not only on the urea side, but also on the ammonia and methanol side. We think that their ability to be a competitive player and actually sell well above marginal cost at where the price is, would bode well for the three major products that are produced out of Iran that we also compete with. These discounts that we've continued to see on the urea side, $50, $60 on the methanol side, sometimes even larger, things disappeared. It's questionable in terms of the amount of additional incremental volume that could come from that because they do still suffer from the gas shortages in the winter and the fact that some of these plants were built using non-super technologies during periods of sanctions during earlier parts of the last decade. Okay. Thank you. Thank you. Your next question comes from the line of Rikin Patel from Exane. Hi all. Thanks for taking my questions. Just two there. Firstly, on the market, you spoke about India earlier, in terms of demand and supply balance. I'm just curious if you could provide some insights into the current tender, and how you think that will impact nearer term pricing. Secondly, just following up on the Fertiglobe IPO, and I appreciate you're limited in what you can say, but in terms of the remaining business methanol side, how does this impact your thinking on further portfolio transformation in the U.S. fertilizer assets or Europe going forward? That'd be helpful. Thanks. Yeah. The offer has just been published I think in the last few hours on the India tender. We're going to see the counter offers. It's a little bit too early to speculate. What we do think is that India does need to take a sizable portion. I think the offer comes in with 2.2 million tons, 2.3 million tons or 2.6 million tons. 2.6 million tons we think they need to take 1.5 million tons. What is it? 2.3 million tons. They'll need to take 1.5 million tons via this tender, roughly. They're going to need to come back every 90 days until September to make sure that they have enough products from the market. They went for a longer shipping period, which is indicative of needing to take more tons going I think closer to 50 days versus closer to the 40 days that they've done in the past, which really cleans up May and June for some of those lagging tons. Some producers we think sold into other markets in the meantime while there's been delays on this India tender. We think that this will be a good way to kind of continue to suck up supply out of the various markets, including China, over the course of the summer. We also think Latin America will continue to need to import product. Australia as well in the next few months. As I mentioned, we're excited particularly with what we've been seeing in Argentina that's quite strategic for us in that we've been benefiting from a duty exemption that allows us to be very well in place for our different product going to Argentina. Obviously, the next month and a half still has the U.S. and European markets still applying urea for top dress and side dress. We've seen over the last few weeks, you may have seen continual focus on urea, where actually, I think July futures are above June, where there's that concern again, what I mentioned on the UAN side, about having enough product in the U.S., and it'll be an interesting year to see how NOLA performs relative to global markets. The U.S. is also quite low on inventories, and I think it's surprising with the fact that it continues to be the highest priced product in the world stretching into May and potentially into June. Brazil is racing up with it as we speak as well. We'll see how that unfolds. Can you please sorry, your second question? Yeah, no, it's just on the main business following the IPO of Fertiglobe, the fertilizer assets, that is. Has this impacted your thoughts on further portfolio transformation, i.e., selling further assets in Europe or the U.S. or any sort of other partnerships? Well, I think Hassan kind of went through some of the rationale behind the IPO itself for Fertiglobe. Our strategy and focus and kind of what we're looking at globally as a team continues to be focused on the same thing, which is operational excellence, getting the most out of our assets. I mean, the fact that we had almost a 30% increase in methanol volumes despite the downtime with Natgasoline in Q1 bodes well for what we see for the remainder of the year on the methanol side, and we want to achieve that. With regard to the fertilizer assets, we also still see further optimization potential in the two assets we have outside of Fertiglobe, in terms of both energy efficiency and onstream time. Very related to that, and it's hard to decouple, is our ESG focus and the different opportunities there. Obviously, operational excellence is a part of that, like I said, almost every single site globally has multiple initiatives being reviewed that are either upstream feedstock related to decarbonize or downstream customer related. We're seeing a lot of different avenues to decarbonize that are very interesting on the demand side and utilizing our existing infrastructure side. When you say, in terms of divestments, I mean, we're going to continue to look for value creation opportunities. We want to demonstrate our potential in this type of environment as we de-lever, and we get our operational excellence up, decreasing the cost between EBITDA and free cash flow more and more so that we have more capital within the OCI system and have to decide how we allocate that capital across the different initiatives. We're always looking for opportunities to consolidate. Our anticipation with this Fertiglobe IPO, we don't lose the fact that there is still the strong OCI presence in the ecosystem with Fertiglobe to allow for a continued consolidation in what is still a fragmented industry that's in dire need of consolidation relative to other commodity chemical markets. Great. Thanks. Thank you. The next question is the line of Chetan Udeshi from JPMorgan. Hi. For taking my questions. I had two questions. First is, can I confirm when you say Q2 adjusted EBITDA higher than Q1, are you including the gain from natural gas in that comparison? Are we talking about comparison versus Q1 with natural gas gain included when we talk about Q2 higher than Q1? That's the first question. The second question was a bit more technical, if I may. Within your Middle East business, especially in Algeria, there is an arrangement where the minority holder in the Algerian JV is paid higher dividend than the proportionate share that they have in that business. How should we then think about the economic interest of OCI overall in the Fertiglobe? I think it's fair to say you have a share in Fertiglobe, but within your share, there are also minorities who might have a higher economic interest, just given the structure of the dividend payments. I can take that. Regarding the first question, the guidance, we're not trying to be cheeky. The guidance already includes the Natgasoline gain, that's included. We believe we're going to have a better quarter in the second quarter on top of that. Again, that's a reflection of the backdrop of some of the best markets we've seen, and we are positioned with a unique profile of assets that has some of the best cash flow conversion, youngest fleet of assets in the industry. Despite that, we still have opportunities based on manufacturing excellence program to find further efficiencies and volume step-ups. I think we've demonstrated even in lower price conditions, that we were still able to generate free cash flow and improve our leverage profile in the last two years. Now, with the uptick in the market, it's a very different story. On the second question, yeah, I mean, that's something that's been very known to investors and analysts, and we always discuss it in all of our meetings that we distribute, or the net economics in Algeria about just under 40% our share. The way we look at it's like looking at the very low gas price and the fact that there is no income tax in Algeria. We look at it on a consolidated basis. Whether you look at it as a form of an income tax, or whether you look at it as a form of a normalized gas price, it's structured as just a higher share of dividends. Yes, we do have partnerships in our ecosystem, concentrated in Fertiglobe, and that's why we always guide to, whenever there are distributions, there's going to be minority interest leakage. It can be lumpy at times, depending on the timing of extraction. As the Fertiglobe business is now having an excellent year, and we highlight that into the first quarter, naturally there'll be some higher leakage associated with that. We're going to be extracting very healthy dividends going forward. This is a business with a cost structure that has very interesting free cash flow conversion possibilities. As prices go up with a fixed gas cost regime, it keeps improving on the cost curve. Thank you. Thank you. Your final question comes from the line of Roberto Casoni from Otus Capital. Yes. Hi, good afternoon. Thank you for taking my questions. Most of my questions have been answered already, but I have one which is possibly related to the Q2. It's still unclear to me what Q2 is going to be developing like. If I just look at the nitrogen, ammonia, and urea price, Q2, of course, is going to be much better than Q1. It's possibly the easiest comp next this quarter in terms of sales. What is not clear, particularly ex Fertiglobe, is how the natural gas price will impact it. You say that you hedge the natural gas and this should be included as a gain in Q2. This is something I actually don't understand. What happens when the hedge is not there anymore? Can you elaborate a bit better how should we see Q2, particularly ex Fertiglobe, in terms of margin expansion, ex also the hedge, if it's possible? Thank you. Yes. Fair question. Just with regards to the hedging. The hedging gain that we had, that happened to refer to in the last question, was a Q1 event that we had pretty strong winter hedges in place. That type of hedging is not in place here in Q2 to the effect that we had in Q1. The team did a really good job of being able to resell gas at times and also modify its financial derivatives at times to generate a net gain of $70 million-$80 million. Okay. That gain was mainly in the U.S.? That gain was only in the U.S. Okay. We actually had a $25 million hit relative to last year on higher gas costs in Q1 that are in the results you're seeing today. Right. Sorry for interrupting. Without the hedge, U.S. would be EBITDA $ single digit in millions. Single digit? Yeah. If you had a $70 million, $80 million, $75 million, $80 million impact positive in the U.S., and EBITDA in the U.S. was $80 million in Q1, I'm talking about nitrogen only. Okay. That's where I think the confusion is. You're saying nitrogen in the U.S. I'm saying this is across methanol and nitrogen, including. Okay. With not a. Okay. This is the three itself. The three flat. It was a net gain of that amount. Now it's clear. Now having clarified it, should I see a margin expansion ex Fertiglobe in Q2? Yes. Obviously, there's volatility. As we said, with the price environment we're seeing today, and the fact that we're still able to sell with some visibility on Q2, yeah, we should see margin expansion outside of Fertiglobe in Q2. There's been obviously a run-up in gas prices the last few days in Europe. Like I think I mentioned earlier, that could result in some lower margins. Overall, we see that as a positive. To capture one of, I think, the questions from Citi earlier, was in terms of people, how they think about the summer reset, when you have higher gas prices, you have two of our nine plants experiencing the higher gas prices. Also all the European plants and Eastern European plants and ones that are less efficient, seeing those higher gas prices pushing up the gas price floor, which we think bodes well for the broader system. This drives overall our guidance for overall business for a higher Q2, including gas gains in Q1, higher Q2 EBITDA. That's clear. That's very clear. Thank you. Thank you very much. Welcome. We have no further questions if you wish to continue. We have no further questions on the telephone lines, sir. Well, thank you everybody for joining our call, and we look forward to the next one. Thank you. That does conclude your call for today. Thank you all for participating. Thank you. You may now disconnect.