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the Company

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Title: the Company


1
Harnessing Nature Creating Value
2nd Annual NASDAQ TASE Israeli Investor
Conference November, 2007
2
Disclaimer
  • The information delivered or to be delivered to
    you does not constitute an offer or a
    recommendation to do any transaction in Israel
    Chemicals Ltd. (ICL) securities. Although our
    shares may be bought and sold on the Tel Aviv
    Stock Exchange (TASE) at any time, they do not
    constitute trade out of Israel - neither in the
    United States nor elsewhere and this presentation
    does not constitute an offer or investment advice
    to any US or other person at this time. If we
    ever do so, our offer will only be made by a
    prospectus or a registration statement conforming
    with the requirements of U.S. or any other
    applicable law.
  • Certain statements in this presentation and other
    oral and written statements made by ICL from time
    to time, are forward-looking statements,
    including, but not limited to, those that discuss
    strategies, goals, outlook or other
    non-historical matters or project revenues,
    income, returns or other financial measures.
    These forward-looking statements are subject to
    risks and uncertainties that may cause actual
    results to differ materially from those contained
    in the statements, including, among others, the
    following (a) the changes in worldwide economic
    and political conditions that impact interest and
    foreign exchange rates, (b) the extent to which
    ICL is able to successfully integrate
    acquisitions, achieve synergies and develop new
    markets, (c) the extent to which ICL is able to
    achieve savings from its various plans, (d)
    government funding and program approvals
    affecting products being developed or sold under
    government programs, and (e) cost and delivery
    performance under various program and development
    contracts. We caution you that the above list of
    important factors is not comprehensive. We refer
    you to filings that we have made with the TASE.
    They may discuss new or different factors that
    may cause actual results to differ materially
    from this information.
  • All information included in this document speaks
    only as of the date on which they are made, and
    we do not undertake any obligation to update such
    information afterwards.
  • Some of the market and industry information is
    based on independent industry publications or
    other publicly available information, while other
    information is based on internal studies.
    Although we believe that these independent
    sources and our internal data are reliable as of
    their respective dates, the information contained
    in them has not been independently verified and
    we can not assure you as to the accuracy or
    completeness of this information.
  • Readers and viewers are cautioned to consider
    these risks and uncertainties and to not place
    undue reliance on such information.

3
Company Basics
4
Dynamic Controlling Shareholder
1.8 bn Mkt. Cap
13 bn Mkt. Cap
06 Rev. gt3bn
200 m Mkt. Cap
IDE 50 by ICL Sea Water Desalination
5
A Balanced Business
Note based on external sales
2006 Sales 3.3 billion
6
From Basic Minerals to Value-Added Products
Fertilizers
Industrial Products
Performance Products
  • Potash
  • Phosphates
  • phosphate rock
  • phosphoric acid
  • fertilizers
  • animal feed additives
  • Flame retardants
  • based on Bromine
  • organophosphorus
  • Brominated Inorganic
  • products
  • Water treatment biocides
  • Other
  • Specialty
  • Phosphates
  • food electronic gradephosphoric acid
  • phosphate salts
  • food additives
  • other phosphorus based products
  • Alumina Other
  • Chemicals
  • performance products

50
61
80
39
50
20
2006 Sales
Including Suprestas 2006 results
7
Recognized and Well Established
Shareholders
  • 1952 Mining operations begin at Dead Sea
    Negev desert
  • 1975 ICL established as a state-owned holding
    company
  • 1992 IPO (TASE)
  • 1995 Israel Corporation acquires control
  • 1999 Ofer Group acquires control of Israel
    Corporation

13 billion market cap
November 20, 2007
8
Increasing Share Price Compared to Peers
9
Focused on Increasing Shareholders Value
NIS
ICL
(NIS)
TA 25
ICL (US)
SP 500
10
Second Largest Company on TASE
Trading Volumes
Change in Market Cap
11
Impressive Returns
ROE
ROIC
Last 12 months
ROE (Return on equity) - Net income /
(shareholders' equity Debentures convertible
into shares), average
ROIC (Return on invested capital ) (Operating
income (1-0.32)) / ((trade receivables
inventory trade payables) PPE, net), average

12
Dividend Yield ICL
Calculated according to market capitalization
based on average share price adjusted for
dividends.
13
Strategic Focus on Core Businesses
Acquisitions and JVs 1.06 billion worth
Rotem Turkey (DCP/MCP plant)
Chemada (Israel 26)
Scora (France)
Food hygiene bus., CFPI (France)
Biogema
Astaris (US)
Iberpotash(Spain, 40)
2 JVs in China
Supresta (US)
NU3 (JV between Yara, SQM ICL)
Cleveland Potash Ltd. (UK)
BKGLC (JV in China, 51)
Iberpotash(Spain, 60)
Adicon (Brazil)
JV with DKS (Japan)
Sinobrom (50 JV)
Fire-trol
2006
2007
1998
2003
2005
2004
1999
2000
2001
2002
Including share acquisitions of ICL
subsidiaries (250 million in 1999-2000)
14
Invested Significantly
Acquisitions674M
Investments960M
ICL Spent 1.6B from 2001-2007 on investments
(net of grants) and acquisitions
15
Direct Access to Low Cost Natural Resources
The Dead Sea
Potash Bromine Magnesium Salts
Iberpotash CPL
Phosphates
Leveraging our low cost positions
16
Leading Player in Global Industry
  • 1 elemental bromine one third of global
    production
  • 1 in organophosphorus flame retardants
  • 1 producer of pure phosphoric acid
  • 1 in specialty phosphates
  • 1 supplier in Europe of PK fertilizers (compound
    potash phosphate)
  • 2 Europe and 6 Worldwide in potash supply
  • 2 Western World - magnesium production
  • and
  • Major player in specialty chemical high margin
    niche markets specialty fertilizers

17
Strong Global Presence
Europe 37
North America 22
Israel 6
Asia Pacific 23
Africa 2
South America 10
Sales by Geography (2006)
18
Growing Revenues and Highly Profitable
millions, first nine months
Sales
19
Environmental Strategy An Active, Dedicated
Focus
  • Integral part of ICL business strategy is
    preservation of the environment and full
    compliance with standards of environmental
    responsibility.
  • Environmental work plan includes investment of
    130 million (2006 and 2007) to improve the
    environmental profile of operations.
  • Primary focus is on implementing processes for
  • creating a safe work environment
  • improving safety of manufacturing processes
  • creating safe products for our customers
    (product lifecycle)
  • rehabilitation of areas for the benefit of the
    public, tourists (e.g. landscaping)
  • Environmental strategy includes full transparency
    to the government, environmental organizations
    and the public to increase trust in ICLs
    stewardship of the environment.

20
Business and Market Opportunities
21
Fertilizers
Lowest Cost Potash Producer at Dead Sea
Source British Sulphur / CRU (June 2005)
Charges to FOB Cost at mine
US per tonne KCl
APC
KS
ICL - Israel
Canpotex (Vancouver)
PCS (St. John)
Belaruskali
Uralkali, Silvinit (Ventspills)
Uralkali, Silvinit (St. Petersburg)
22
A Leader in Global Potash Production
Fertilizers
Source Fertecon, IFA, companies reports and ICL
estimates, 2006
Exports by BPC
Exports by Canpotex
23
Long Term Increase in Demand
Fertilizers
Sources U.S. Census and FAO database
24
Fertilizers
Growing Demand for Biofuels
Source Earth Policy Institute, Renewable Fuel
Association
3.8 of Global Consumption of Gasoline
0.4 of Global Consumption of Diesel
25
Fertilizers
Rising Grain Prices
Source CBOT
Corn
Wheat
Jun 2005
Sept 2006
Dec 2006
Mar 2007
Jun 2007
Sep 2007
Soybeans
26
Fertilizers
Steep Increases in Fertilizer Prices
Source Fertecon, October 2007
27
ICL IP After Integrating Supresta
Industrial Products
Based on 2006 sales, including Suprestas 2006
results
28
Most Concentrated Bromine Source
Industrial Products
Source ICL estimates Arkansas brine wells
of Chemtura Albemarle
29
1 Bromine Producer
Industrial Products
of global capacity Sources Company estimates,
US Bureau of Mines, Arkansas Oil Gas
Commission, Companies press releases, 2006
30
Bromine Compounds - Broad Applications
Industrial Products
Source ICL estimates
Global Industry 2 billion
Elemental bromine, photographic applications,
butyl rubber, dyes more
One of the 3 leading players in the industry
31
Leading Indicators for Bromine Market Trends
Industrial Products
Sources Baker Hughes Rig Count, IPC Association,
Semiconductor Equipment and Materials
International (SEMI)
Worldwide Rig Count
32
Supresta Enhancing ICL-IPsProduct Mix
Geographic Reach
Industrial Products
  • Acquisition of Supresta completed August 07
  • Segment sales of 1.1 billion annually
  • A leader in the flame retardants market

33
Phosphate Downstream - Synergistic Acquisitions
Performance Products
1 in the world in pure phosphoric acid
Food Additives Worldwide
Food Hygiene
Phosphate Salts Europe Asia
Food Grade Phosphoric Acid Israel
Phosphoric Acid (MGA)
Typical selling price in /ton
Commodity Fertilizers (eg. TSP)
Phosphate Rock
Services and Solutions
Basic Products
34
Performance Products
Astaris Integration
  • Acquisition of business assets of Astaris
    completed November 05
  • Segment sales of over 1 billion annually
  • A leader in the global specialty phosphates
    industry

ICL PP (Europe/AP)
ICL PP (Americas)
Thermal Acid
Food Additives
Phosphate Salts
Phosphate Salts
PPA
PPA
35
Financials
36
1-9/07 Income Statement
1-9/ 07
1-9/06
millions
change
Sales (CIF)
2,889.2
2,418.5
19.5
25.3
Gross profit
1,038.7
828.7
Gross margins
35.9
34.3
Operating income
491.2
388.7
26.4
Operating margins
17.0
16.1
Financing expenses, net
34.2
25.1
Other expenses, net
5.6
(14.0)
Taxes on income
87.7
105.3
Net income
371.0
283.7
30.8
37
Strong EBITDA Operating Cash Flows YTD
millions, first nine months
1 Net profit depreciation and amortization
financing expenses taxes one time items 2
Cash flows from operating activities, excluding
contribution of securitization and factoring
38
Net Financial Liabilities
millions (end of period)
1,460
1,447
1,350
1,314
1,263
1,183
1,112
825
794
785
771
Liabilities due to share acquisitions in
19992000 250 million
Net financial liabilities credit from banks
and other interest bearing debt, minus cash and
cash equivalents, investments and short-term
deposits, long term financial investments and
income-tax deposits.
39
Comparable Companies - YTD
1 Based on an exchange rate of 6.00 NOK/USD and
of 1.34 USD/EUR 2 Based on summing of the
last three quarters (Mosaic 1st nine months ended
in August 31, 2007) 3 Net income margins
Note The results of the comparable companies
were taken from their public reports.
40
Conclusion
  • Multi-national company
  • Vast access to natural resources
  • Sustainable low cost position ? high margins
  • Growing revenues and substantial profitability
  • Strong cash flows and high dividend yield
  • Potential cost reduction pending availability of
    natural gas
  • Focused synergistic growth strategy

41
Thank You
Visit us at www.icl-group.com
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