2008 Q1 Reporting (January –March 2008) May 21,...

Petrotec - as sustainableas biodiesel gets2008 Q1 Reporting(January – March 2008)

May 21, 2008

Disclaimer

This presentation does not constitute or form part, or all, of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of Petrotec AG (the "Company"), nor shall part, or all, of this presentation or their distribution form the basis of, or be relied on in connection with, any contract or investment decision in relationto any securities. This presentation is furnished to you solely for your information, should not be treated as giving investment advice and may not be copied, distributed or otherwise made available to any other person by any recipient. It does not constitute an offer to sell or the solicitation of an offer to purchase shares of. The shares offered in connection with the Company's initial public offering in 2006 have already been placed.

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Agenda

1 Executive Summary

2 Q1 08 Financials & Operations

3 Strategy & Outlook

Company & shareholder structure1 Executive Summary

PETROTEC AG– Holding –

VITAL Fettrecycling GmbH– Sourcing/Production –

PETROTEC Biodiesel GmbH– Sales –

100%100%

Shareholder structure*

GLG Partners: 16,39%

Petrotec S.á r.l.:42,10%

Freefloat:28,81%

Management: 4,70%

BlackRock: 3,00%

ACM: 5,00%

Company GmbH– Sourcing –

KOEKO sp.zo.o– Sourcing –

100%

80%

* Most recent WpHG-notifications

Key success factors in the biodiesel industry

1. Sustainability of biodiesel production chain essential as we move forward

– Food vs. fuel, de-forestration, CO2 reduction etc.

2. Cost management is key in this industry, which obtains its feedstockfrom a commodity market and sells its product into a commodity market

– Feedstock is most important as its costs account for at least 85% of entire cost

– Commonly used feedstocks (virgin oils) are readily available for everyone

– Markets for low quality feedstocks (used cooking oil and animal fat)are fragmented and intransparent, thus offer cost advantage

3. Technology determines the capability of producing biodiesel from low quality feedstocks

– Only very few technologies available which can handle difficultto process feedstocks and produce EN 14214 compliant biodiesel

1 Executive Summary

Key success factors for Petrotec

n Petrotec offers the most sustainable biodiesel

n Petrotec is emerged into used cooking disposal industry since 1991

n Petrotec possesses proprietary fully continuous multi-feedstock technology

1 Executive Summary

Biofuels are an industry with an enormous potential1 Executive Summary

n Biofuels are the only valid alternative to resolve the finite character of fossil fuels

n Biodiesel helps EU-oil majors to solve their structural diesel-shortage and their refining capacity bottlenecks

n All main truck manufactures have approvedtheir engines to run on 100% Biodiesel

n Nissan Europe has launched B30 biodiesel powered versions of their vans; French PSA and Renault will offer a B30 engine in 2010

n Distribution logistics of oil majors can be usedfor biodiesel without modifications

n Only biofuels can provide the volume neededto make the transport & traffic sector more carbon emission friendly

n Stern-Report: not acting against the ongoing climate change will have severe consequences to all national economies

n Even biofuels need to be produced on a sustainable basis – i.e. cutting down rainforests to grow palmis not sustainable

n Amongst others, Swiss study (EMPA) compiles the profile of different feedstocks with regard to CO2emission and eco-balance: waste is the most sustainable feedstock

n Using waste as feedstock avoids food vs fuel debate

n National governments and the EU shift from a volume based blending requirement to a well-defined reduction in CO2 emissions (decarbonisationstrategy)

Renewables are a proven alternative for fossil fuels Ecological sustainability is key

Q1 2008 was a difficult quarter1 Executive Summary

Current developments

Industryn B100 market collapsed due to risen tax

duties on pure biodieseln No changes in German biofuels laws

expectedn Proposal on EU Directive to support

renewable energies favours biofuelsbased on waste

n UK started mandatory blending requirement (RTFO) with 2.5 % quota

n US B99 practice may be terminated soon due to a new farm bill

Petrotecn Construction of Emden plant on

schedulen Refinery already running, products being

soldn Successful expansion of UCO-collection

throughout Europen Factoring started to further improve

working capital managementn Provisions for pending losses on

biodiesel contracts

Agenda

1 Executive Summary



Key Q1 2008 financials – p&l

-31.6%2,1851,494Depreciation

nm-695-6,125EBITDA

-3,152

-3,141

155

-415

-2,880

1,459

62

556

1,258

93.5%

18,045

19,302

16,284

Q1 2007

nm252Valuation derivative

Nm-52Financial result

-135.3%-7,418PAT

-136.2%-7,418PBT

-164.5%-7,618EBIT

+335.0%6,347Other oper. expenses

-58.1%26Other oper. income

+146.8%1,372Personnel expenses

+24.6%1,568Gross profit

-3.3pp90.2%Material cost ratio1

-19.8%14,470Cost of materials

-16.9%16,038Total output

-3.3%15,742Revenue

Δ yoyQ1 2008[in EUR ‘000]

1 Material costs as percentage of total output

Highlightsn Yoy revenue decrease

primarily due to reduced biodiesel sales tonnage as a result of less B 100 demand

n Slightly reduced material cost ratio results in higher gross profit

n Personnel expenses +147% yoy due to head count increase from 53 to 95

n other oper. expenses include provision for pending losses of 4.6m € due to increased feedstock prices for old fixed price biodiesel contracts

n Depreciation decreased by 691k € due to impairment charge in December 2007


Key Q1 2008 financials – B/S

+404.7%1,4007,066Short term provisions

+35.3%5169Financial assets

0%18,12218,122Financial liabilities

81,021

0

9,991

51,508

81,021

20,511

5,205

3,577

20,169

31,508

Dec 2007

-2.9%19,595Intangible assets

-4.9%77,027Total equity and liabilities

00Tax liabilities

-22.3%7,762Trade payables and other liabilities

-14.4%44,077Equity

-4.9%77,027Total assets

-50.6%10,143Cash and cash equivalents

+36.3%7,095Trade receivables and other assets

+114.8%7,685Inventories

+3.0%32,440Property, plant and equipment

Δ yoyQ1 2008[in EUR ‘000] Highlightsn Net increase in PPE of 0.9m €

as a result of Emden plant

n Inventories and receivables increased by 6.0m € due to restart of Borken and preparation of ramp-up Emden; results in decreased cash position

n Short term provisions increased by 5.7m €, thereof 4.6m € for impending losses

n Equity ratio reduced from 63.6% to 57.3%

n Current cash approx. 13m €


Key Q1 2008 financials – Cash flow

5,665Non-cash change in provisions

Q1 2008

10,143Cash and cash equivalents as at end of period

-13Cash Flow from financing activities

-1,735Cash Flow from investing activities

-8,712Cash Flow from operating activities

0Change in income tax liabilities

-1,976Change in trade payables and other liabilities

-6,225Change in inventories and trade and other receivables

-510Gross cash flow

-252Valuation derivatives

1,494Depreciation

-7,418Loss for the period

[in EUR ‘000] Highlightsn Gross cash flow of -6.2m €

improved to operating cash flow of -0.5m € due to working capital management

n Investing cash flow stems from 19.2m € investment Emden plus 6m € financial investment (6-months-fixed investment)

n 17.0m € financing cash flow resulting from 18.1m € cash inflow (bank financing) and 1.1m € cash outflow due to IPO related expenses

n End of period cash balance 10.1m €, current cash approx. 13m €


Sourcing – 31% yoy boost on own UCO collection

Petrotec raw material sources Q107 and Q108Petrotec treated used cooking oilprices by quarter in €/t

Highlightsn Price for treated UCO increased from 410 €/t in Q1 07 to just over 500 €/t in Q1 08n 700 new UCO customers in first four months 08, in 07 in total 1.500 new customersn Co-operation with local based waste management company in Northern Germany which adds

presumably 3,000 tons p.a.n Ongoing screening of market for M&A opportunities throughout Europen Petrotec acquired a majority-interest in a polish UCO collector as of Jan. 1,2008

300

350

400

450

500

550

2006 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08

79%

12%

9%

Purchase of treated material

Own collection (untreated)

Purchase from collectors(untreated)78%

14%

8%

Q1 07 Q1 08


Production – recommencement of Oeding plant

Production volume in tons 06 to Q1 08

Highlightsn Q1 08 production output 15,800 tons (-8% yoy)

n Reduced production output in Q1 due to recommencement resp. ramp-up of Oeding biodiesel plant

n 74% utilization resp. output in relation to annual nominal capacity

0

5.000

10.000

15.000

20.000

2006 q avrg Q1 07 Q2 07 Q3 07 Q4 07 Q1 08


Sales volumes by market segment in tons, Q1 06 – Q4 07

Sales – German B 100 market collapsed due to tax increase

Highlightsn Sales volume decreased 4% yoy in spite of price increase of 10%

n Sales split Q1 08 B100 / Blend 9% / 91% vs 45% / 55% in Q1 07

n Average sales price Q1 08 760 €/t vs 690 €/t in Q1 07 (+10% yoy)

n Increased demand from big oils for CO2 sensitive biodiesel

0

5.000

10.000

15.000

20.000

25.000

2006 qavrg

Q1 07 Q2 07 Q3 07 Q4 07 Q1 08

BlendB 100

Petrotec avrg. sales pricesper quarter in €/t

600

650

700

750

800

2006 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08


Agenda

1 Executive Summary



Outlook: Spread between UCO and biodiesel prices in favor for Petrotec‘s business model3 Strategy & Outlook

Biodiesel vs UCO US and EU (€/mt)April 07 – actual

n 100,000 t plant Emden will start production shortly, including tank farm, refinery and jetty

n Refinery already running, products being sold

n Both Oeding and Emden will operate with a market determined utilization

Spread Biodiesel vs. UCO EU and UCO US (€/mt) April 07 – actual

n Currently stable spread > 200€

n Fixing the provisions of pending losses

n Profitable business on basis of solely back-to-back contracts

New 08 guidance: turnover of € 90-100 million and EBITDA loss of € 5 million►

04 05 06 07 08 09 10 11 12 01 02 03 04 05

2007 200806

220320420520620720820920

1,020

120

€/mt Biodiesel UCO EU UCO US

04 05 06 07 08 09 10 11 12 01 02 03 04 05

2007 200806

150

200

250

300

350

100

Spread US Spread EU

Medium term outlook - CO2 reduction will be the future value and price driver

n Being the cost leader of main stream feedstocks, palm oil determines the pricen Dependent on individual CO2 reduction default values as defined in the RED by the EC,

feedstock specific values will be derivednWaste based biodiesel shall count double in fulfilling blending requirementsn Due to the highest default value of 77% CO2 reduction, UCO-based (=waste-based)

biodiesel will be the most valuable biodiesel

Assumed values based on cost leader (palm)

0

20

40

60

80

100

120

Biodiesel Rape Biodiesel Sunflower Biodiesel Palm Biodiesel UCO

cent

/ l

0

25

50

75

100

% C

O2-

redu

ctio

n ba

sed

on

prop

osal

of E

C

valueDefault Value

Petrotec can achieve a maximum CO2 reduction of 93.4% (based on LCA of independent consultancy) by optimizing its process►


Investor Relations

Mr. Falk von Kriegsheim

Phone +49 2862 91 00 60Fax +49 2862 91 00 [email protected]

Investor RelationsContact

May, 21st, 2008 Q1 Report 2008

June 6th, 2008 Annual General Meeting

August 21st, 2008 H1 Report 2008

Nov 20th, 2008 Q3 Report 2008

March 30th, 2009 Annual Report 2008

FinancialCalendar 2007/2008

mailto:[email protected]

http://www.petrotec.de

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