IPL Annual Report 2012
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File Type：pdf, Size：1020Kb
2012ANNUAL REPORT 2012 Ekati Diavik Meadowbank North Bay Tumbler Ridge CANADA Mount Wright Calgary Maitland Lausanne Biwabik Boisbriand Tirana St Helens Ormstown Bucharest Barry Simsbury Ankara Salt Lake City Port Ewen Cheyenne USA Soma Donora TURKEY Carthage Duffield Louisiana Graham CHINA Linyi (Fabchem) PAKISTAN Wolf Lake Brooksville New Delhi Dinamita Hong Kong Gomez Palacios INDIA Guadalajara MEXICO Muara Tuhup Tenggarong Batu Arang (TKEB) Berau PAPUA NEW GUINEA SOUTH Sibolga Tanjung Tabalong Lihir AFRICA Jakarta Batu Kajang INDONESIA Moranbah Townsville Port Hedland LATIN Mt Isa Moura AMERICA Phosphate Hill (Queensland Nitrates) AUSTRALIA Gibson Island Kalgoorlie Helidon La Serena Johannesburg (SASOL Dyno Nobel) Perth Kooragang Island Santiago Port Adelaide Johannesburg (DetNet) Melbourne Portland Geelong Devonport Moranbah ammonium nitrate plant Ekati Diavik Meadowbank North Bay Incitec Pivot Limited Tumbler Ridge CANADA Mount Wright Company Headquarters Calgary Maitland Incitec Pivot Fertilisers Lausanne Biwabik Boisbriand Corporate Office Tirana St Helens Ormstown Manufacturing/Distribution Barry Bucharest Simsbury Quantum Fertilisers Ankara Salt Lake City Port Ewen Cheyenne USA Soma Donora Dyno Nobel TURKEY Carthage Duffield Corporate Office Louisiana Graham Manufacturing/Distribution CHINA Linyi (Fabchem) PAKISTAN Wolf Lake Brooksville Joint Ventures/Investments New Delhi Dinamita Hong Kong Gomez Palacios INDIA Guadalajara MEXICO Muara Tuhup Tenggarong Batu Arang (TKEB) Berau PAPUA NEW GUINEA SOUTH Sibolga Contents Tanjung Tabalong Lihir AFRICA Jakarta Chairman’s Report ii Batu Kajang INDONESIA Moranbah Managing Director’s Report iv Townsville Port Hedland LATIN Board of Directors vi Mt Isa Moura AMERICA Phosphate Hill (Queensland Nitrates) Executive Team vii AUSTRALIA Gibson Island Kalgoorlie Helidon La Serena Directors’ Report 1 Johannesburg (SASOL Dyno Nobel) Perth Kooragang Island Santiago – Remuneration Report 9 – Corporate Governance Johannesburg (DetNet) Port Adelaide Melbourne Statement 27 Portland Geelong Devonport Financial Report 38 VISION STATEMENT To be the best in our markets, delivering Zero Harm and outstanding business performance through our people, our culture and our customer focus. Chairman’s Report It is particularly pleasing to lead the Board as the Company completes its biggest-ever development project, the ammonium nitrate complex at Moranbah in Queensland I am delighted to be able to present my major contributors to this record. The first talented men and women who never first report as Chairman of Incitec Pivot is that the people at Graham regard each stopped believing they could do it. other as family members and take a Limited. It is particularly pleasing to lead One of the pluses to come from the personal interest in making sure that the Board as the Company completes its Moranbah development is that we have friends and colleagues are protected from biggest-ever development project, the demonstrated that IPL is capable of injury, not only in the workplace but also ammonium nitrate complex at Moranbah completing major construction projects. in their home lives. It is a personal thing. in Queensland. Watching the final touches This credibility and, more importantly, the The second factor that struck me was that being made to Moranbah has reassured experience and skills which we developed all of the people in Graham really believe me that we have a great company with at Moranbah, put us in a strong position that Zero Harm is possible. To put this some tremendous opportunities along to be able to seriously consider other another way, they strongly believe that with, inevitably, some interesting opportunities which may arise for the every safety incident which occurs challenges. I have no doubt we have an Group. However, in considering throughout our Group could have been extremely strong team and the right opportunities, you can be assured that we prevented. We must be relentless in strategy to build on IPL’s success to date. will continue to apply the highest levels pursuing ‘Zero means zero’ and I believe In terms of financial performance, the of financial discipline and pursue only a lot of our improvement will come from Group’s underlying profit, Net Profit After projects which are consistent with our replicating the culture that exists at Tax (NPAT), excluding Individually Material strategy and which we believe will give us Graham at other sites right across the Items (IMIs), compared to 2011, was an acceptable level of return. As you may Group. If we need any further evidence of down to $404.7 million, a decrease recall, during the year we commenced what is possible, we need look no further of 24% or $125.4 million on the previous two major feasibility studies, one for an than Moranbah, where the construction year. While the financial result was ammonium nitrate plant in the Hunter project involved four million hours unsatisfactory, 2012 saw substantial Valley, New South Wales, and the other without a lost-time injury. We must strive progress because of actions taken to on a 750,000 tonne ammonia plant in to emulate that performance across our respond to strategic business challenges Louisiana, United States. While the entire organisation and, to that end, the and the establishment of important feasibility study on the ammonia plant in Directors have endorsed a clear five-year building blocks for the future. Our Louisiana is continuing, with a decision strategy to drive improvement in our Managing Director & CEO, James Fazzino, planned for the second quarter of the safety performance. The Board’s Health, covers this in detail in his report, so I will 2013 calendar year, we decided to delay Safety, Environment and Community take the opportunity to reflect personally the Hunter Valley study for at least two Committee has had a critical role in upon some of the things that have years in light of the current market overseeing and reinforcing our progress impressed me as I have travelled around uncertainty and rising construction towards Zero and, in the coming year, some of our major operations, both in costs in Australia. will maintain its practice of visiting Australia and in the United States, over our operations and engaging with our When comparing potential projects in the past few months. people on site. Australia and the United States a significant The first thing which has been brought difference lies in the price of our major raw The calibre and diversity of people in home to me is the relentless obsession material, gas. The impact of this is currently all parts of our organisation also made with safety and the pursuit of Zero Harm, being seen in the United States, where the a huge impression on me. Whether it be which we must continue to drive in all low gas price is leading to a revival of that at a customer’s site in the Pilbara or at a parts of the IPL Group. At Board level, country’s major manufacturing industries. manufacturing facility on the other side safety is the first item on the agenda of In our view, it is essential that Australia of the country at Gibson Island or at every meeting and the same applies to has a coherent energy strategy which one of our various sites in the United James’ meetings with his Executive Team. recognises the importance of being able to States, it is impossible not to be However, it is only when you visit our source gas at a price which will encourage impressed by the enthusiasm of the various sites that you see examples investment in new manufacturing activity. many smart people we have working of how our people, at all levels of the I know that we risk being accused of in our team. A classic example is at our organisation, are equally committed to arguing self-interest in this area, but at the ammonium nitrate plant at Moranbah in Zero Harm. very least, I believe that this is a subject the Bowen Basin, where the first tonnes that needs to be thoroughly debated in the Recently, I was at our Initiating Systems of ammonium nitrate were produced in national interest and we are committed to plant in Graham, Kentucky, where I took early July 2012. Despite the doubts of being part of that debate. the opportunity to present an award for some, the project was delivered exceptional performance in achieving essentially on time and close to budget. Another plus from the completion of more than 2000 days without a lost-time The fact that Moranbah is now operating Moranbah is the direct benefit it has had injury. Two elements struck me as being on schedule is a great tribute to the for our shareholders, in that it has changed ii Incitec Pivot Limited Annual Report 2012 our capacity to pay dividends. Our final dividend is 9.1 cents per share, bringing the full year dividend to 12.4 cents per share, an increase of 8% on the 2011 full year dividend of 11.5 cents per share. This dividend is at a payout ratio of 50% of NPAT excluding IMIs, which reflects the increased payout ratio endorsed by the Board – namely 30–60% of NPAT excluding IMIs, compared to 20–40% adopted in 2009. The DNAP team priming holes with boosters, detonators and leads on a mine site. We have a wide range of shareholders on our register and we are cognisant of particular focus was placed on who have diligently exercised their retail shareholders benefitting from establishing a clear diversity strategy professional duties in guiding the franking credits. Our intention is to addressing our global operations and, Company over the past financial year. distribute franking credits when they in Australia, focussing on initiatives I look forward to working with each of are available. Pleasingly, for the final with regards to gender diversity and the Directors individually and as a team dividend, we were able to increase the indigenous employment.