A t 22nd 2013

2013 Interim Report

August 22nd, 2013

Disclaimer

This presentation and the presentation materials distributed herewith include forward-

looking statements. All statements, other than statements of historical facts, that

address activities, events or developments that Sinofert Holdings (“Sinofert”) expects

or anticipates will or may occur in the future (including but not limited to projections,

t t ti t d b i l ) f d l ki t t t Si f t’targets, estimates and business plans) are forward-looking statements. Sinofert’s

actual results or developments may differ materially from those indicated by these

forward looking statements as a result of various factors and uncertainties includingforward-looking statements as a result of various factors and uncertainties, including

but not limited to price fluctuations, actual demand, exchange rate fluctuations,

exploration and development outcomes estimates of reserves market sharesexploration and development outcomes, estimates of reserves, market shares,

competition, environmental risks, changes in legal, financial and regulatory frameworks,

international economic and financial market conditions political risks project delayinternational economic and financial market conditions, political risks, project delay,

project approval, cost estimates and other risks and factors beyond our control. In

addition, Sinofert makes the forward-looking statements referred to herein as of today

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addition, Sinofert makes the forward looking statements referred to herein as of today

and undertakes no obligation to update these statements.

I. Operation ReviewII. Financial PerformanceIII. Outlook

Market Environment: Fertilizer Market in Severe Conditions(1/3)

P i T d f Gl b l M j F tili

Global Oversupply Aggravated Prices of Global Major Fertilizers Declined

Status Quo of Global Fertilizer Supply

580600

Price Trend of Global Major Fertilizers(USD/Ton)

Yuzhny Prilled Urea Baltic&Black Sea DAP

Status Quo of Global Fertilizer Supply & Demand

(Million Tons, Pure Amount) Supply

Demand

470500

550

212 220

225

238

205212

216

405400

450198 205

321

300

350

2012-1-1 2012-4-1 2012-7-1 2012-10-1 2013-1-1 2013-4-1 2013-7-12010 2011 2012 2013 E

Source：IFA Source: FMB

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Market Environment: Fertilizer Market in Severe Conditions(2/3)

Domestic Oversupply Intensified Continuous Price Drop of Domestic Major Fertilizers

Status Quo of Domestic Fertilizer Price Trend of Major FertilizersSupply & Demand

(Million Tons, Pure Amount) Supply

Demand

j(RMB/Ton)

Factory Price of Urea in ShandongFactory Price of DAPPort Price of Russian Pink Potash

63 58

71 75

56 57 58 59 3,150

2,700 3 0403,000

3,500

Port Price of Russian Pink Potash

2 100

,3,040

2,400 2,500

2010 2011 2012 2013 E

2,100

1,700 1,500

2,000

2012-1-1 2012-4-1 2012-7-1 2012-10-1 2013-1-1 2013-4-1 2013-7-1

Source: Data of 2010-2012 are from Wind ; data of 2013 is based on Sinofert’s estimation

Source: Baiinfo

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based on Sinofert s estimation

Market Environment: Fertilizer Market in Severe Conditions(3/3)

Risen Deficit Rate of Domestic Fertilizer Plants

Increased Deficit Scale of Major Fertilizer Plants

Accumulated Deficits of Major Fertilizers(RMB Million)

Compound FertilizerPotash

Deficit Rate of Major FertilizerPlants

1H 20111H 2012 Potash

PhosphateNitrogen

4,357

31% 33%31%

39%

33%

1H 20121H 2013

2,2382,571

14%

21% 21%

10%

22%

12%

1H 2011 1H 2012 1H 2013

9%10%

Nitrogen Phosphate Potash Compound

Data Source: Wind

1H 2011 1H 2012 1H 2013Nitrogen Phosphate Potash Compound Fertilizer

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Key Financial Indicators: Profit Declined While Market Share Stabilized

Sales Volume(1,000 Tons)

9,144

(1,000 Tons)

Turnover(RMB Million )

Y-o-Y(RMB Million )

20,580Y-o-YNet Profit Attributable to

Owners of the Company(RMB Million)

Y Y

352Y-o-Y

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Upstream Resources: Further Strengthening the Mining of Phosphate RockDeeply Pushing Forward Geological Exploitation

Geological Reserve of Phosphate Rock of Sinochem Yunlong

Kunming

Qujing Xundian

1 30

Sinochem Yunlong(100 Million Tons)

Explored Reserve

2 Mining Rights of

1.16 0.41 0.47 0.54

1.30 Expected Reserve

Preliminary Work of Deep Mine Projects in Dawan and Mozushao in Progress

2 Mining Rights of Phosphate Rockwith Reserve of 73.55 Million Tons

Dawan

Mozushao Dawan Fagudian Yuezhao

250 Mozushao

g

4 Prospecting Rights of Phosphate Rock

Mozushao

Fagudian

Mining Capacity(10, 000 Tons)Dawan

60 Total Resource Reserve of about 300 Million Tons

Fagudian

Yuezhao0

90

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Before Construction

After Construction

300 Million TonsPhosphate Rock

Before Construction

After Construction

Midstream Manufacture: Relentlessly Promoting the Industry Strategy of Advanced Manufacture

Production Consumption of

Progress of Sinochem Changshan’s Urea Renovation and Expansion ProjectBy the end of June, 2013, the project was on schedule:

Reduced Producti Consumption of Manufacturing Enterprises

Urea in Sinochem ChangshanCoal(Ton/Ton) Electricity(KWH/Ton)

-2% -4%

schedule:Investment: 37 contracts were signed with total

contract value of RMB 414 million, accounting for 35% of total investment

Progress: 21.4% of total project was accomplished, ahead of schedule

Quality: Acceptance checks of 216 sub-projects l t d ith 100% i t d

1H 2012 1H 2013

Sulfuric Acid Consumption of Feed-grade Phosphate in Sinochem Yunlong

(Ton/Ton)

1H 2012 1H 2013were completed with 100% passing-rate and no quality issues

Safety: No safety incident

(Ton/Ton)Dicalcium Phosphate

(DCP)Monocalcium Phosphate

(MCP)-10% -8%

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1H 2012 1H 20131H 2012 1H 2013

Midstream Manufacture: Profit Declined Year-on-Year Due to Unfavorable Market Environment

Pretax Profit of Holding Enterprises Share of Net Profits of Sharing Enterprises

(RMB 1,000)

188 390

(RMB 1,000)

169,617

188,390

144,123

48 210

84,718

12,059

48,210

1H 2011 1H 2012 1H 2013 1H 2011 1H 2012 1H 2013

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Downstream Marketing: Continuously Deepening Marketing Transformation (1/2)

Pilot Projects of Compound F tili M k ti

③Value-Added Services(116 Field Schools for Farmers)

Fertilizer Marketing Transformation in North China

★Shandong Branch

)

★Henan Branch

②Strengthening Retail Store

①Enhancing Client Management & Product

Construction and Field Demonstration(747 Fields) Sales Volume of

Compound Fertilizer in Shandong BranchManagement & Product

Services Promotion (Over 1,500 Campaigns)

Shandong Branch

31%

10

1H 2012 1H 2013

Downstream Marketing: Continuously Deepening Marketing Transformation (2/2)

Enhanced Channel Marketing of Potash for Direct Application

Strengthened Supplier & Brand Management of Phosphate

Setting up pricing system with three levels of Improving supplier management and securing the Setting up pricing system with three levels of distribution, wholesale and retail, favoring our franchisersSecuring channel effectiveness by selecting hi h lit li t d di idi l i

p g pp g glink between procurement and sales

Strengthening marketing ability, increasing sales volume and maintaining market influence

high-quality clients and dividing sales regionConducting a series of work including promotion of agrochemical service, crackdown of counterfeit products and

Focusing on prioritized brands of DAP and selecting clients to implement the strategy of “One Brand with One Client in One County”

management of cross-region sales

S l V l f C di

Improved Customer Stickiness Controlled Risks and Guaranteed Profits

Rate of Direct SalesSales Volume of Canadian Pink Potash

8% 55%66%

81%

Rate of Direct Sales1H 2012 1H 2013

34%

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1H 2012 1H 2013 DAP MAP

Downstream Marketing: Overall Profit Declined While Compound Fertilizer Improved Steadily

Gross Profit357

147

390

182

281

160871

（RMB million）

147 160

Potash Nitrogen

792 871

726

g

1H 2011 1H 2012 1H 2013

1H 2011 1H 2012 1H 2013

116 134141 143147 133

Compound Fertilizer Phosphate

Note: Total gross profit includes profit from products except four major fertilizers such as micro element fertilizer etc.

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I. Operation ReviewII. Financial PerformanceIII. Outlook

Business Scale: Sales Volume Increased While Turnover Declined Slightly

（1,000 tons） （RMB 1 000）

Sales Volume Turnover（1,000 tons） （RMB 1,000）

9%1%

8,392 9,048 9,144

18,471,791

22,536,74520,580,073

-9%

1H 2011 1H 2012 1H 20131H 2011 1H 2012 1H 2013 1H 2011 1H 2012 1H 2013

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Profit: Gross Profit Declined with Market Price Decreasing

404Gross Profit

355

219

390 404

281 250

1,469

（RMB million）

Potash Nitrogen

1,161

1,469

1,122

g

1H 2011 1H 2012 1H 2013

286323

1H 2011 1H 2012 1H 2013

255 286

263 231 251

Compound Fertilizer Phosphate

Note 1: Total gross profit includes profit from products except four major fertilizers such as micro element fertilizer etc.

Note 2：Gross profits of nitrogen in 1H 2011 and 1H 2012 include profits from Sinochem Pingyuan

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p gy

Cash Flow: Consistent Net Inflow for Operating Cash Flow

Net Operating Cash Flow Surplus Cash Coverage（RMB 1 000）（RMB 1,000）

4,182,562 8.3

862,6601,205,480

1 5

3.5

1H 2011 1H 2012 1H 2013

1.5

1H 2011 1H 2012 1H 2013

Note: Surplus cash coverage = Net operating cash flow /Net profit

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Operation Efficiency: Asset Operating Efficiency Maintained Relatively High

Receivables Turnover Days Inventory Turnover Days（Days）

Receivables Turnover Days Inventory Turnover Days（Days）

59 62 21

48 16

10

1H 2011 1H 2012 1H 20131H 2011 1H 2012 1H 2013

Note: Inventory Turnover Days=180 / (Sales Cost / Average Balance of Inventory)

Note: Receivables Turnover Days=180 / (Sales Revenue / Average Balance of Receivables）

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Solvency: Secure and Stable

Liabilities to Assets ratio Debt-to-Equity RatioLiabilities to Assets ratio Debt-to-Equity Ratio

47%42%

52%56%

44%

30%

End of June, 2011 End of June, 2012 End of June, 2013End of June, 2011 End of June, 2012 End of June, 2013

Note: Debt-to-Equity Ratio= Liability with Interest / Total EquityNote: Liabilities to Assets ratio= Liabilities / Total Asset

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Evaluation Index: Major Credit Ratios Kept Good

Liability with Interest / EBITDA Liability with Interest /Total Capital FFO/Liability with Interest

4.7 50.0%

49.0%

2.1

3.34.0

27.7% 29.5%23.2%

23.4%28.0%

10%

1H 2011 1H 2012 1H 2013 Normal Value End of June, 2011

End of June, 2012

End of June, 2013

Normal Value 1H 2011 1H 2012 1H 2013 Normal Value

Note: The Index below 4 0 meets the Note: The Index below 50% meets the Note: FFO refers to operational cashNote: The Index below 4.0 meets the requirement of investment grade

Note: The Index below 50% meets the requirement of investment grade

Note: FFO refers to operational cash flow before movements in working capital. And the Index above 10% meets the requirement of investment grade

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I. Operation ReviewII. Financial PerformanceIII. Outlook

Macro-economy: To Recover Gradually from the Economic Trough

Global Economy Will Grow Steadily in the Long Term

GDP Growth Forecast of Major Economies in 2013 & 20142013 2014

Economic Entity Forecast in April

Forecast in July Change Forecast Year on Year

ChangeGlobe 3.30% 3.10% -0.20 3.80% +0.70

US 1.90% 1.70% -0.20 2.70% +1.00

Euro Area -0.40% -0.60% -0.20 0.90% +1.50Emerging and Developing Economies 5.30% 5.00% -0.30 5.40% +0.40

China 8.10% 7.80% -0.30 7.70% -0.10

Globe: Major developed countries and emerging economies will be encountered with a

Source: IMF

temporary economic trough in 2013 and get recovered gradually later. Euro zone will also

step out of the situation of negative growth

Chi Th i th i l ti l t bl d i t i l ti l hi h l l

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China: The economic growth is relatively stable, and maintains a relatively high level

Agriculture Market: China’s Agricultural Modernization Has Good Prospect in the Long Term

th

Item Indicator 2010 2015 Growth RateS ppl of Agric lt ral

Growth Objectives of Key Indicators for the Development of Modern Agriculture in the 12th Five-Year Period

Supply of Agricultural Products Overall grain production capacity (100 million tons) 5.0 5.4 8%

Agricultural Structure Output Value of Agricultural Products Processing Industry / Total Output Value of Agriculture (multiple) 1.7 2.2 29%

Agricultural Materials & Eq ipments

Comprehensive Mechanization Level of Plowing, Planting & Har esting 52% 60% -Equipments Planting & Harvesting

Agricultural Science & Technology

Contribution Ration of Scientific and Technological Progress 52% 55% -

Agricultural Production & Operation Organization

Number of Farmers Supported by AgriculturalIndustrialization Organizations ( 100 million) 1.07 1.3 21%

Input for Agriculture, Rural Areas & Farmers from the Central Government Keeps Increasing

Income of Farmers Net Income of Rural Residents Per Capita (RMB) 5,919 8,310 40%Source: Development Planning for National Modern Agriculture(2011-2015)

Opportunity: With constantly from the Central Government Keeps Increasing

（RMB 100 million） increasing government input for

agriculture, agricultural 8 580

10,498 12,388

13,799

modernization has been

stimulating the demand of 5,956

7,253 8,580

22Source: Ministry of Finance

fertilizer and agrochemical service2008 2009 2010 2011 2012 2013E

Fertilizer Market: Facing More Opportunities in the Process of Development

Status Quo of Fertilizer Oversupply

（million tons）

Fertilizer Demand Keeps Increasing Constantly

238150（million tons）

222

228

233

238 150 142 Supply

Demand

216

222

46 42 42 33

2013E 2014E 2015E 2016E 2017ENitrogen Fertilizer Phosphate Fertilizer Potash Fertilizer

Source：IFA

Nitrogen and Phosphate: With obsolete production capacity to beNitrogen and Phosphate: With obsolete production capacity to be eliminated, the industry will develop towards advanced manufacture and large-scale capacity

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Potash: The breakdown of BPC alliance will further lead to the change of global potash structure

Business Strategy: Strengthening Current Operation & Intensifying Transformational Innovation

Strictly control the business risk under the severe market environment, and secure the current business performance through grasping the opportunity of the fertilizer peak season in autumn

Business

Continue to speed up the business transformation from trading to marketing and improve the sales proportion of high margin products;Management marketing and improve the sales proportion of high margin products; steadily promote the key technology-upgrading projects

Management

Pay close attention to global M & A opportunities in the process of Opportunity

industrial consolidationpp y

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Nurturing China's Modern Agriculture!Nurturing China s Modern Agriculture!

Thank You!