Annual Report 2020
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ANNUAL REPORT 2020 Main Menu Incitec Pivot Limited ABN 42 004 080 264 Level 8, 28 Freshwater Place Southbank, Victoria, Australia, 3006 Telephone: +61 3 8695 4400 Facsimile: +61 3 8695 4419 www.incitecpivot.com.au CONTENTS 5 ABOUT US This document is interactive. 6 Our Operations Click any of the contents menu headings throughout 8 Who We Are this document to be taken 9 Our Values to that page. Click the home 10 Our Strategy icon at the bottom of any 13 PERFORMANCE & OUTLOOK page to return to each section contents menu. 14 2020: Responding to the COVID-19 Pandemic 16 Chairman’s Report 17 Managing Director & CEO’s Report 18 Operating & Financial Review 33 BEING A SUSTAINABLE BUSINESS 34 Zero Harm: Our License to Operate 36 Our People 38 Sustainability Overview 42 Climate Change Strategy and Governance 44 Caring for Our Communities 45 Community Activity Highlights 47 GOVERNANCE 48 Corporate Governance 50 Board of Directors 52 Executive Team 55 FINANCIAL & STATUTORY REPORTS 56 Directors’ Report 60 Remuneration Report 81 Financial Report 120 Independent Auditor’s Report 127 ADDITIONAL INFORMATION 128 Shareholder Information 129 Five Year Financial Statistics 130 Glossary 131 Corporate Directory Incitec Pivot Limited Annual Report 2020 3 IPL is a recognised world leader in the resources and agricultural sectors. 4 Incitec Pivot Limited Annual Report 2020 ABOUT US Incitec Pivot Limited Annual Report 2020 5 OUR OPERATIONS Mary River Ekati e Diavik e e Meadowbank CANADA Flin Flon e e Ishpeming Tumbler Ridge e North Bay Calgary a Maitland Biwabik e Boisbriand St Helens a e Ormstown Barry i Simsbury Salt Lake City Lincoln i USA Ankara a Cheyenne e a Donora i e e Soma Carthage i e Duffield TURKEY Louisiana, Missouri a e Van Wyck CHINA Waggaman, Louisiana e Brooksville PAKISTAN Dinamita i i Graham New Delhi Gomez Palacios i Wolf Lake Hong Kong INDIA Guadalajara e MEXICO Incitec Pivot Limited e Muara Tuhup Company Headquarters e Tenggarong e Berau Incitec Pivot Fertilisers PAPUA NEW GUINEA SOUTH Sibolga Corporate Office Tanjung Tabalong e e Lihir Manufacturing/Distribution AFRICA Jakarta Quantum Fertilisers Batu Kajang e INDONESIA e a Moranbah Dyno Nobel Townsville LATIN Port Hedland e Corporate Office Mt Isa e Moura AMERICA Manufacturing/Distribution Phosphate Hill (Queensland Nitrates) Joint Ventures/Investments Gibson Island AUSTRALIA La Serena i e Manufacturing legend Kalgoorlie e i Helidon Santiago Kooragang Island i Initiation i Johannesburg (SASOL Dyno Nobel) Perth a e Warkworth e Emulsion i Port Lincoln Johannesburg (DetNet) Melbourne a Port Adelaide AN Geelong a Long term AN supplier Portland Devonport 2003 5000 60 Listed on ASX Employees Manufacturing facilities 6 Incitec Pivot Limited Annual Report 2020 Mary River Ekati e Diavik e e Meadowbank CANADA Flin Flon e e Ishpeming Tumbler Ridge e North Bay Calgary a Maitland Biwabik e Boisbriand St Helens a e Ormstown Barry i Simsbury Salt Lake City Lincoln i USA Ankara a Cheyenne e a Donora i e e Soma Carthage i e Duffield TURKEY Louisiana, Missouri a e Van Wyck CHINA Waggaman, Louisiana e Brooksville PAKISTAN Dinamita i i Graham New Delhi Gomez Palacios i Wolf Lake Hong Kong INDIA Guadalajara e MEXICO Incitec Pivot Limited e Muara Tuhup Company Headquarters e Tenggarong e Berau Incitec Pivot Fertilisers PAPUA NEW GUINEA SOUTH Sibolga Corporate Office Tanjung Tabalong e e Lihir Manufacturing/Distribution AFRICA Jakarta Quantum Fertilisers Batu Kajang e INDONESIA e a Moranbah Dyno Nobel Townsville LATIN Port Hedland e Corporate Office Mt Isa e Moura AMERICA Manufacturing/Distribution Phosphate Hill (Queensland Nitrates) Joint Ventures/Investments Gibson Island AUSTRALIA La Serena i e Manufacturing legend Kalgoorlie e i Helidon Santiago Kooragang Island i Initiation i Johannesburg (SASOL Dyno Nobel) Perth a e Warkworth e Emulsion i Port Lincoln Johannesburg (DetNet) Melbourne a Port Adelaide AN Geelong a Long term AN supplier Portland Devonport 3 million 2 million World class tonnes of ammonium tonnes of fertiliser technology nitrate produced produced Incitec Pivot Limited Annual Report 2020 7 WHO WE ARE IPL is a recognised world leader in the resources and agricultural sectors. With 60 manufacturing facilities and joint ventures across five continents, including Australia, North America, Europe, Asia, Latin America and Africa, we manufacture ammonium nitrate-based explosives and initiating systems, nitrogen and phosphorus fertilisers, and nitrogen related industrial and specialty chemicals. We have two customer facing businesses, Dyno Nobel based in the Americas and in Asia Pacific and the largest fertiliser business in Australia, Incitec Pivot Fertilisers. Through these two businesses, we make people’s lives better by unlocking the world’s natural resources through innovation on the ground. Our advanced and premium technology, manufacturing excellence and world class services are focused on the diverse needs and aspirations of our customers, ensuring IPL’s continuing key role in developing the efficiency and sustainability of the world’s resource and agricultural sectors. Dyno Nobel Global Manufacturing Dyno Nobel is IPL’s global explosives business. It is the second Americas: In North America, Dyno Nobel manufactures ammonium largest industrial explosives distributor in North America and nitrate at its Cheyenne, Wyoming and Louisiana, Missouri plants. the second largest industrial explosives distributor in Australia The Cheyenne, Wyoming plant is adjacent to the Powder River by volume. Basin, strategically placed for both the Base & Precious Metals Base sector and North America’s most competitive thermal coal Americas: Dyno Nobel Americas (DNA) provides ammonium nitrate, mining region. The Louisiana, Missouri plant has a competitive initiating systems and services to the Quarry & Construction sector logistic footprint from which to support the Quarry & Construction primarily in the Southern US, Northeast US and Canada; the Base sector and mining in both the Illinois Basin and Appalachia. & Precious Metals sector in the US mid-West, US West and Canada and the Coal sector in the Powder River Basin, Illinois Basin Initiating Systems are manufactured at Dyno Nobel’s facilities and Appalachia. in Connecticut, Kentucky, Illinois, Missouri, Chile and Mexico, and are also sourced from DetNet South Africa (Pty) Ltd (DetNet), Asia Pacific: Dyno Nobel Asia Pacific (DNAP), provides ammonium an IPL electronics joint venture. nitrate based industrial explosives, initiating systems and services to the Met Coal and Base & Precious Metals sectors in Australia, and Asia Pacific: In Australia, Dyno Nobel manufactures ammonium internationally to a number of countries including Indonesia, Papua nitrate at its Moranbah plant, which is located in the Bowen Basin, New Guinea and Turkey through its subsidiaries and joint ventures. the world’s premier metallurgical coal region. It also operates its fully integrated, state of the art joint venture ammonium nitrate Incitec Pivot Fertilisers facility near Moura in Central Queensland. Incitec Pivot Fertilisers (IPF) is IPL’s fertilisers business. With an Initiating Systems are manufactured at Dyno Nobel’s Helidon unrivalled position across Eastern Australia, it is the largest domestic facility in Queensland, and are also sourced from IPL facilities manufacturer and supplier of fertilisers by volume produced from in the Americas and its joint ventures. its strategically positioned manufacturing facilities, including the ammonium phosphate fertiliser plant in Phosphate Hill, The business also produces nitrogen-based fertilisers and industrial complemented by the world scale sulphuric acid plant at Mount chemicals across four locations including its state of the art Isa. Internationally, the fertilisers business sells to major offshore ammonia plant in Waggaman Louisiana, that are delivered agricultural markets in Asia Pacific, the Indian subcontinent, Brazil to its fertiliser end markets via an integrated supply chain. and the United States. It also procures fertilisers from overseas manufacturers to meet domestic seasonal peaks for its customers’ diversified crops. 8 Incitec Pivot Limited Annual Report 2020 OUR VALUES Our Company values are at the core of the way we work. With a One IPL – One Team mindset and behaviours, coupled with cross functional and geographical collaboration across our businesses, we are able to capture diversity of thought in an inclusive environment where the contribution of everyone is valued. We Think Safe, Act Safe, Be Safe. This is our license to operate. We listen, understand and exceed customer expectations. We are accountable, act with honesty and integrity to achieve the best outcomes. We work together across our businesses and functions with respect, trust and collaboration. We proactively listen and work in partnership with the communities in which we operate. We proactively seek to continually improve the way we work, embrace change and pursue innovative solutions. We do what we say we are going to do. Incitec Pivot Limited Annual Report 2020 9 OUR STRATEGY Explosives Fertilisers Our explosives business strategy leverages our premium technology, Following the strategic review of the fertilisers business undertaken strategically located assets and strong customer relationships. this year, our long term strategy is to grow IPF from a leading fertiliser company, manufacturing and distributing a range of With the best premium technology offering on the ground, designed domestic fertilisers, to a sustainable soil health company