EXCELLENCE – FFC’S HALLMARK

FAUJI FERTILIZER COMPANY LIMITED

COMPANY INTRODUCTION
• Fauji Fertilizer Company is Pakistan’s largest manufacturer and seller of fertilizers • Incorporated in 1978 as JV of Fauji Foundation and Haldor Topsoe, Denmark. • Produces and markets fertilizer products under the premium brand name SONA • One of Top-25 companies

UREA MARKET PARTICIPATION
Others 10%

Year 2007, MeT

Daw ood 10% FFC 60%

Engro 20%

Total 2007 Urea Offtake: 4.86 million MT

LOCATION MAP

Corporate Head Office Marketing H. O.

Plant Site – Goth Machhi Plant Site Mirpur Mathelo

4,030 MTPD

1,740 MTPD

FFBL, Bin Qasim

INVESTMENTS
1982 1992 1993 1999 2002 2008 2009 2008 2009 Plant I, Goth Machhi DBN of Plant I Plant II, Goth Machhi Fauji Fertilizer Bin Qasim Acquisition of PSFL, Mirpur Mathelo PMP, Morocco DBN of Plant III DBN of FFBL Wind Power 570,000 MTPY 695,000 MTPY 635,000 MTPY 997,000 MTPY 574,000 MTPY 375,000 MTPY 718,000 MTPY 1,288,000 MTPY 50 MW US$ 307 m US$ 20 m US$ 317 m US$ 460 m US$ 145 m US$ 200 m US$ 40 m US$ 75 m US$ 130 m

•Value addition of Rs. 20.2 billion in 2007, Foreign exchange savings of US$ 807 million Redistribution (million Rs., Year 2007) 67
Government as taxes Provider of capital 5,428 Shahreholder as dividends Employees as renumeration 11,979 659 Retained with the business

VALUE ADDITION

2,201

million Rs.
20,000 25,000 30,000 1 0,000 1 5,000 5,000 -

1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

REVENUE GROWTH

'000 Metric tons
500 1000 1500 2000 0 1982 1983 1984 1985 FFC-1 1986 1987 1988 1989 1990 695,000 1991 1992 1993 1994 1995 1996 1997 1998 FFC-2 FFC-3 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1,330,000 DBN FFC-1 570,000 1,904,000

GROWTH IN INSTALLED UREA CAPACITY

FFC PRACTICES AND VALUES
Follow highest business ethics and standard of conduct Attain excellence in all areas of its operation Ensure customer satisfaction through superior product quality and technical advice Full compliance to occupational health & safety, and environmental standards Continue to strive for improvement through:
Coordinated efforts Feedback Training Employee motivation

SUCCESS FACTORS
a. Optimal operation of plants to achieve maximum production b. Commitment to Safety c. Emphasis on Human Resource Development d. Highly motivated and dedicated teams e. Technology & Engineering Capabilities

SUCCESS FACTORS
f. Effective Inventory Management System g. Adequate Maintenance and Workshop Facilities h. Inspection and plant audits i. Plant Reliability Task Force j. Quality Management System Implementation

ACQUISITION OF PSFL – A SUCCESS STORY
• • • Acquisition of Paksaudi Mathelo in 2002 Fertilizers, Mirpur

Due diligence by FFC professional team Areas in focus were
• • • Evaluation of maximum production potential Assessment of plant integrity & reliability Identification of potential for further improvement

PRE-ACQUISITION PERFORMANCE
Yearly Avg. Performance • • • • • • Plant reliability Capacity & Service factor Product quality High energy consumption Safety and environmental problems Lack of standard practices in Management, Operation and Maintenance Inadequate facilities Administrative issues Prod, MT CF, % SF, % Sp. Energy, GCal/MT Urea Product Quality Moisture, % Biuret, % Fines, % 0.46 1.00 3.00 582,000 105 87 7.8

• •

MEASURES ADOPTED
• Technical skills and management practices implemented to bring plant at par with FFC standards Identified short-term and long-term measures to improve performance Investment plans

PERFORMANCE COMPARISON
Parameter Production, MeT Capacity Factor, % Service Factor, % Specific Energy, Gcal/Met
Urea

Pre-Acquisition 582,000 105.0 87.0 7.84 0.46 1.00 3.00

Average PostAcquisition 705,839 120.2 92.4 6.74 0.35 0.86 0.41

Moisture in urea product, % Biuret in urea product, % Fines, %

CONCLUSION
To be a successful manufacturing company, following areas need attention of entire organization with commitment and support from the top management: • Commitment to safety • Compliance to systems and procedures • Human resources development • Implementation of rigorous maintenance & inspection procedures • Independent technical monitoring and audit • Strong engineering and technical backup

Thank You

TOTAL FFC UREA PRODUCTION (MeT)
ACTUAL VS DESIGN (1982-2007)
2,500,000

2,000,000

1,500,000

1,000,000

500,000

1982

1983

1985

1986

1987

1988

1990

1991

1993

1994

1995

1996

1998

1999

2001

2002

2004

2006

Actual

Design

2007

1984

1989

1992

1997

2000

2003

2005

0

DAILY PRODUCTION RECORDS
MTPD / (Load %) Plant I 2,490 / (118.3%)

Plant II

2,368 / (123.0%)

Plant III

2,201 / (126.5%)

PLANT ON-STREAM FACTORS
1 00 95 90 85
1 997
P l ant I

1 998

1 999 2000
P l ant I I

2001 2002 2003
Wor l dwi de aver age

North America

Europe

Source: Plant Surveys International, USA

PRODUCT QUALITY
l l Top quality product Chemical composition (46% N, Biuret, Moisture) Physical properties (Prill size, hardness, etc.) Regular monitoring and investment to keep our product quality ahead of the competition

l l

COMMITMENT TO SAFETY
• • • Safety is exercised in all spheres of plant operation 15 awards of honor from National Safety Council (USA) since 1982. Two special safety awards on outstanding performance in 1989 and 1993 by the Council for constantly achieving outstanding performance in the field of safety. Other awards as well.

SAFETY AWARDS
Description Number of Awards Received Award of Honor First Place Award Second Place Award Award Of Merit Perfect Award Industry Leader Award Outstanding Safety Award 15 5 4 4 2 2 2

HUMAN RESOURCE DEVELOPMENT • • Hiring at grassroots level to groom employees as per company needs Training

• Apprenticeship Program: Graduates hired and trained regularly. Only the best continue as company employees. • Continuing Skill Improvement: Outside and in-house training on a variety of areas
• Cross Training: Effective employee training in different departments

TECHNICAL TRAINING CENTER
• Technical Training Centre is the only centre in Asia having a true replica of the Plant for providing training to the employees. Regular in-house training courses as well as for Pakistani industry. Fully equipped to impart training to employees and market its services to other clients from Pakistan and abroad

TECHNOLOGY & ENGINEERING DIVISION
l Continuous monitoring and improvements of plant operations l Major role in expansion of FFC business by implementing major modifications and new projects
q q q q

Debottlenecking of Plant I Plant II FFBL Plant III acquisition Wind Power

l Identify business diversification
q

l Close liaison with technology suppliers, other

QUALITY MANAGEMENT SYSTEM IMPLEMENTATION
1 ISO-9001:2000 Quality Management System, Certification by Bureau Veritas Quality International

2

ISO 14001:1996

Environmental Management System

3

OHSAS 18001:1999

Occupational Health & Safety Assessment Series

• Routine audits by top-notch accreditation firms • Reaped significant dividends vis-à-vis quality management system

CORPORATE SOCIAL RESPONSIBILITY
l l l Hazrat Bilal Trust Hospital in Goth Machhi Free medical camps in nearby villages SONA Hospital at Mirpur Mathelo
• • • Free consultancy to local population (male and female doctors) Snake and dog bite cases, 24hour emergency care Subsidized medicines and Lab facilities

l

Coronary care unit at Civil Hospital Mirpur Mathelo

CORPORATE SOCIAL RESPONSIBILITY EDUCATION

Scholarships for farmers’ children
higher secondary school and education throughout their tenures university

• • •

SONA Public School at a cost of Rs 33 million School adoption program (8 schools so far) Extend support to government high school having 1400 students

CORPORATE SOCIAL RESPONSIBILITY ENVIRONMENT
• • • • All emissions well within NEQS standards Continuous investment made by FFC Plant II is based on total recycle process Conversion of chromate based cooling water system to phosphate based Renewable energy

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