Boliden Ab · OMXSTO:BOL
Boliden Ab — Q4 2013 Earnings Presentation
37 slides from Boliden Ab's earnings presentation, Feb 12, 2014
Slide 1: Year-end report January – December 2013
Year-end report January – December 2013 Lennart Evrell President & CEO Mikael Staffas CFO
Slide 2: Summary Q4 2013
Summary Q4 2013 MSEK Quarterly EBIT excl PIR* R4Q, MSEK Rolling Q EBIT, RHS 1 800 7 200 Revenues 8 653 (10 194) MSEK Rolling Q EBIT excl PIR*, RHS EBIT ex PIR* 548 (839) MSEK 1 600 6 400 ‒ EBIT 486 (676) MSEK 1 400 5 600 Free Cash Flow -206 (110) MSEK Milled production Aitik 10 mt 1 200 4 800 ‒ Targ
Slide 3: Summary 2013
Summary 2013 Revenues 34 409 (40 001) MSEK EBIT ex PIR* 2 271 (4 042) MSEK Lower metal prices and terms Major planned maintenance shutdowns Stable production in general Weak Rönnskär, strong Harjavalta Large investments ‒ Projects on plan Proposed dividend 1.75 (4) SEK per share Boliden Group Q4 201
Slide 4: The Market
The Market Boliden Group Q4 2013 4 2014-02-12
Slide 5: Economic development
Economic development GDP growth, year on year % Industrial production, year on year % 14 25 China World 12 20 USA EU27 10 15 8 10 6 5 4 0 2 -5 0 -10 China World -2 USA EU27 -4 -15 -6 -20 Latest data: USA, China Q42013, EU, World Q3 2013 December 2013 latest data -8 -25 Source: Reuters Datastream, Bo
Slide 6: Construction
Construction Largest segment for Cu and Zn Activity, year on year % US housing starts and construction sentiment M units annual rate NAHB index 40 1,2 70 30 60 1,0 20 EU27 construction IP 50 USA - construction expenditure 0,8 China - fixed assets investment 10 40 0,6 0 30 0,4 -10 20 0,2 -20 10 US Ho
Slide 7: Automotive
Automotive No 2 segment for Cu and Zn Quarterly car production, year on year % 120 China - Production of passenger cars 100 USA - industrial production automobile & light duty truck Europe - light vehicles 80 60 40 20 0 -20 -40 -60 -80 Latest data: Q4 2013 2008 2009 2010 2011 2012 2013 Source: Reute
Slide 8: Market balance
Market balance Zinc – global market Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Demand 2.7% 2.3% 3.0% 3.7% 4.8% Smelter production -5.5% 1.6% 5.1% 9.1% 5.1% Metal balance, kt -49 45 42 21 114 Mine production -2.2% 2.6% 0.7% 1.3% -1.4% Concentrate balance, kt 153 -38 182 143 23 Copper – global market Q4
Slide 9: Zinc price and inventories
Zinc price and inventories 2 300 USD/t LME Inventory Shanghai Inventory Price Price Q avg USD/t Q1 Q2 Q3 Q4 5 000 1,8 2 200 Millions 2 100 4 500 1,6 2 000 4 000 1,4 1 900 3 500 1 800 1,2 1 700 3 000 1,0 1 600 2 500 0,8 1 500 31-dec 31-jan 28-feb 31-mar 30-apr 31-maj 30-jun 31-jul 31-aug 30-sep 31-ok
Slide 10: Zinc TC and premiums
Zinc TC and premiums US$/t Treatment charges Metal premium $/t metal concentrate 300 250 250 200 200 150 150 100 100 50 50 0 0 2010 2011 2012 2013 2010 2011 2012 2013 Spot TC outturn Europe ex-works US Midwest Delivered Far East (Western) Realised contract TC (incl.price participation) Stable spot T
Slide 11: Copper price and inventories
Copper price and inventories 9 000 USD/t LME Inventory Shanghai Inventory COMEX Inventory Price Price Q avg USD/t Q1 Q2 Q3 Q4 11 000 1,6 8 500 Millions 10 000 8 000 1,4 9 000 7 500 1,2 8 000 7 000 7 000 1,0 6 500 6 000 0,8 5 000 6 000 31-dec 31-jan 28-feb 31-mar 30-apr 31-maj 30-jun 31-jul 31-aug 30
Slide 12: Copper TC and premiums
Copper TC and premiums US$/t concentrate Metal premium Treatment charges $/t metal 140 140 120 120 100 100 80 80 60 60 40 40 20 20 0 0 2010 2011 2012 2013 2010 2011 2012 2013 Standard grade spot TC Spot Copper premium CIF W. Europe Contract TC - annual and mi-year benchmark Benchmark CIF Europe Spot
Slide 13: Gold, Silver and Lead prices
Gold, Silver and Lead prices USD/oz 2 000 Gold USD/t 5 000 Lead 450 Thousands 1 800 4 500 400 1 600 4 000 350 1 400 3 500 300 1 200 3 000 250 1 000 2 500 200 800 2 000 150 600 1 500 400 100 1 000 200 500 50 0 0 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2004 2005 2006 2007 2008 2009 20
Slide 14: Mines
Mines Boliden Group Q4 2013 14 2014-02-12
Slide 15: Mines – Q4 2013
Mines – Q4 2013 MSEK R4Q, Quarterly MSEK 1 600 EBIT 4 800 Q4 Rolling Q EBIT EBIT 422 (545) MSEK ‒ 372 MSEK in Q3 2013 Capex 1 037 (1 195) MSEK 1 200 3 600 Aitik milled production 10 mt Stable production Full year 800 2 400 EBIT 1 598 (2 974) MSEK Capex 3 763 (3 570) MSEK Lower metal prices and terms
Slide 16: Mines – Full Year 2013
Mines – Full Year 2013 EBIT by Unit Lower metal prices and terms MSEK Aitik Boliden Garpenberg Tara Total 3 500 Aitik 2 974 Higher copper production 3 000 Lower gold production 2 500 Boliden 2 000 Mix change – copper to zinc 1 732 1 598 High exposure to precious metals 1 500 1 033 Tara 1 000 882 776
Slide 17: Mines – Production
Mines – Production Milled ore, Metal Milled ore, Zinc Metal mt Copper content, kt content, mt 24 kt 100 1,5 10 20 80 1,2 8 16 60 6 0,9 12 40 4 0,6 8 2 0,3 20 4 0 0 0,0 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2011 2012 2013 2011 2012 2013 Milled ore (Aitik) Met
Slide 18: Mineral Reserves & Resources
Mineral Reserves & Resources Boliden Group Q4 2013 18 2014-02-12
Slide 19: Mineral Reserves & Mineral Resources
Mineral Reserves & Mineral Resources Mineral reserves up in Boliden Area and Garpenberg ‒ Lower grades in Garpenberg Mineral resources decreased in all mining areas except in Tara Significant increase in mineral resources in Laver and Rockliden Exploration in 2013 300 (350) MSEK ‒ 159 000 m drilled
Slide 20: Aitik and Boliden Area
Aitik and Boliden Area Aitik Boliden Area Million ton kton 2 500 18 000 16 000 2 000 14 000 12 000 1 500 10 000 8 000 1 000 6 000 500 4 000 2 000 0 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Inferred Measured/Indicated Inferred Measured/Indi
Slide 21: Garpenberg and Tara
Garpenberg and Tara Garpenberg Tara kton kton 40 000 30 000 35 000 25 000 30 000 20 000 25 000 20 000 15 000 15 000 10 000 10 000 5 000 5 000 0 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Inferred Measured/Indicated Inferred Measured/Indicate
Slide 22: Smelters
Smelters Boliden Group Q4 2013 22 2014-02-12
Slide 23: Smelters – Q4 2013
Smelters – Q4 2013 R4Q, MSEK Quarterly EBIT excl PIR* MSEK Q4: 1 100 Rolling Q EBIT, RHS 2 800 EBIT ex PIR* 149 (202) MSEK Rolling Q EBIT excl PIR*, RHS ‒ 262 MSEK in Q3 2013 900 2 300 Capex 254 (277) MSEK Sulphuric acid prices down Kokkola silver project on plan 700 1 800 Fire in Harjavalta, -30 MS
Slide 24: Smelters – Full Year 2013
Smelters – Full Year 2013 EBIT excl PIR by Unit MSEK Bergsöe Odda Kokkola Harjavalta Rönnskär Total Lower prices and terms for copper smelters 1 200 1 095 Major maintenance shutdowns 1 000 Harjavalta Higher contribution from free metals 800 than normal, ~130 MSEK 679 600 535 Rönnskär Negative impact
Slide 25: Smelters – Production
Smelters – Production Copper Cathode Metal Total feed, production, Zinc production, kt Total feed, kt kt kt 400 100 250 140 350 120 80 200 300 100 250 60 150 80 200 60 40 100 150 40 100 50 20 20 50 0 0 0 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2011 2012 2013 2
Slide 26: Financials
Financials Boliden Group Q4 2013 26 2014-02-12
Slide 27: Financial development – Summary
Financial development – Summary MSEK Q4 2013 Q4 2012 Q3 2013 Revenues 8,653 10,194 8,471 EBITDA 1,212 1,279 1,380 EBIT 486 676 681 EBIT ex PIR 548 839 603 Investments 1,294 1,474 1,151 Free cash flow -206 110 436 Earnings per share, SEK 1.42 3.15 1.81 Net debt / equity ratio 38 28 38 Boliden Group Q
Slide 28: EBIT analysis Q4 vs Q3
EBIT analysis Q4 vs Q3 MSEK Q4 2013 Q3 2013 EBIT 486 681 Process inventory revaluation (PIR) -62 78 EBIT excl. PIR 548 603 Deviation -55 Specification of deviation Volume 63 Prices and Terms (incl. hedges) -9 Whereof currency effects 5 Costs -111 Depreciation -25 Internal profit elimination 56 Other
Slide 29: EBIT analysis Q4 vs Q4
EBIT analysis Q4 vs Q4 MSEK Q4 2013 Q4 2012 EBIT 486 676 Process inventory revaluation (PIR) -62 -163 EBIT excl. PIR 548 839 Deviation -291 Specification of deviation Higher mine production Volume 346 Lower prices for precious metals Prices and Terms (incl. hedges) -435 and sulphuric acid Whereof cu
Slide 30: Financial development – Summary
Financial development – Summary Full year Full year MSEK 2013 2012 Revenues 34,409 40,001 EBITDA 4,632 6,731 EBIT 1,803 4,171 EBIT ex PIR 2,271 4,042 Investments 4,974 4,569 Free cash flow -1,466 1,389 Earnings per share, SEK 4.72 12.21 Net debt / equity ratio 38 28 Boliden Group Q4 2013 30 2014-02-
Slide 31: EBIT analysis 2013 vs 2012
EBIT analysis 2013 vs 2012 MSEK 2013 2012 EBIT 1,803 4,171 Process inventory revaluation (PIR) -469 129 EBIT excl. PIR 2,271 4,042 Deviation -1,770 Specification of deviation Higher mine production Volume 287 Prices and Terms (incl. hedges) -1,818 Lower metal prices Whereof currency effects -422 Wea
Slide 32: Cash flow
Cash flow MSEK 2013 2012 EBITDA including PIR* 4,632 6,731 PIR 469 -129 Inventories -253 -405 Payables -580 615 Receivables -177 234 Other -5 5 Changes in working capital -546 320 Cash flow from investments -4,971 -4,129 Financial items -222 -179 Tax paid -303 -1 145 Other incl. translation differen
Slide 33: Capital structure
Capital structure SEK bn 31 Dec 31 Dec MSEK % Unless otherwise stated 2013 2012 10 000 45 Total Asset 41.8 40.1 40 34.5 31.2 8 000 35 Capital employed 30 Shareholders' equity 23.1 22.4 6 000 25 Net debt 8.7 6.3 20 4 000 15 Gearing, % 38 28 2 000 10 Loan duration, years 2.6 3.5 5 0 0 Average interest
Slide 34: Project update
Project update Silver recovery Kokkola on plan ‒ Start-up Q3 2014 Garpenberg on plan ‒ Start-up first half 2014, full production end 2015 Aitik45 - Decision in 2014 Laver conceptual study Boliden Group Q4 2013 34 2014-02-12
Slide 35: Summary going forward
Summary going forward Market Boliden Global macro improved Aitik Prices flat ‒ Production target of 36 mt reached one year ahead of plan ‒ Base metals up ‒ Low grades through 2014 ‒ Precious metals down Garpenberg New benchmark set for copper TC ‒ Ramp-up start H1 2014 Weak USD Rönnskär, Harjavalta
Slide 36: Disclaimer
Disclaimer This presentation has been prepared by Boliden for information purposes only and as per the indicated date. Boliden does not undertake any obligation to correct or update the information or any statements made therein. Certain statements in this presentation are forward-looking and are su
Slide 37: Boliden Group Q4 2013
Boliden Group Q4 2013 37 2014-02-12