Eregli Demir Ve Celik Fabrikalari T.a.s. · BIST:EREGL

Eregli Demir Ve Celik Fabrikalari T.a.s — Ereğli Demir ve Çelik Fabrikaları T.A.Ş. — Q1 2017 Earnings Presentation

32 slides from Eregli Demir Ve Celik Fabrikalari T.a.s's earnings presentation, Apr 20, 2017

  1. Slide 1: 1

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  2. Slide 2: 2017 3 Months Consolidated Results

    2017 3 Months Consolidated Results 20 April 2017 2

  3. Slide 3: Disclaimer

    DISCLAMIER Ereğli Demir Çelik Fabrikaları T.A.Ş. (Erdemir) may, when necessary, make written or verbal announcements about forward-looking information, expectations, estimates, targets, assessments and opinions. Erdemir has made the necessary arrangements about the amounts and results of such inform

  4. Slide 4: 2017 Market Overview, 2017 3M Results

    ˃ 2017 Market Overview ˃ 2017 3M Results 4

  5. Slide 5: Crude steel production in EU28, CIS and China

    5 -5% -10% 0% 5% 10% 15% Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 -5% -15% -10% 0% 5% 10% 15% Nov-15 Mar-14 Jan-16 May-14 Mar-16 Jul-14 May-16 Sep-14 Jul-16 Nov-14 Sep-16 EU28 CRUDE STEEL PRODUCTION ( YoY % )* Jan-15 Nov-16 Mar-15 Jan-17 May-15 Mar-17 Jul-15 Sep-15 -6% -

  6. Slide 6: Coking coal price increased to USD/ton in April 2017

    Coking coal price increased to 302 USD/ton in April 2017 COKING COAL PRICES IRON ORE PRICES USD/TON (HCC PEAK DOWNS REGION FOB AUSTRALIA) USD/TON (IODEX 62% FE CFR NORTH CHINA MID) 310 100 90 260 80 210 70 160 60 50 110 40 60 30 10.2015 12.2015 02.2016 04.2016 06.2016 08.2016 10.2016 12.2016 02.2017

  7. Slide 7: Turkish steel production increased by 3% in 2017 2M YoY

    Turkish steel production increased by 3% in 2017 2M YoY PRODUCTION ( MILLION TONS ) 36,9 36,9 36,1 36,4 34,3 10,9 10,4 10,4 9,9 9,0 6,1 5,9 26,0 26,5 25,7 26,5 25,3 2,2 1,7 3,9 4,2 2016 2015 2014 2013 2012 2017 2M 2016 2M Long Flat CONSUMPTION ( MILLION TONS ) 34,1 34,4 30,8 31,3 28,5 16,5 16,5 14,6

  8. Slide 8: Turkish iron and steel product exports increased by 16%

    Turkish iron and steel product exports increased by 16% in 2017 2M YoY IRON AND STEEL PRODUCT EXPORTS ( MILLION TONS ) 16,5 15,2 14,1 0,02 13,4 13,1 0,00 0,04 1,8 0,00 0,00 2,3 2,5 3,0 3,1 2,6 0,6 1,6 0,3 0,3 2,6 2,2 0,00 0,00 0,5 0,4 10,0 10,2 11,0 11,3 11,7 0,1 0,0 2,0 1,8 2016 2015 2014 2013 2012

  9. Slide 9: Acceleration in the white goods sector's growth rate is expected

    Acceleration in the white goods sector’s growth rate is expected CHANGES IN SECTOR DEVELOPMENT INDEX (% YoY) 25% 20% 16,0% 15% 10% 7,4% 8,0% 7,1% 5,5% 7,0% 5,5% 3,9% 4,7% 5% 4,0% 5,0% 6,8% 2,7% 1,0% 1,5% 2,8% 3,5% 3,0% 0% 0,6% 1,4% 1,0% 1,0% -1,8% -5% -5,5% -10% 2012 2013 2014 2015 2016 2017(e) Cons

  10. Slide 10: 2017 Market Overview, 2017 3M Results

    ˃ 2017 Market Overview ˃ 2017 3M Results 10

  11. Slide 11: Erdemir Group Key Figures

    ERDEMİR GROUP KEY FIGURES 2017 3M 2016 3M 2016 2015 Liquid Steel Production (000 Tons) 2.350 2.362 9.373 9.122 (1) Slab Production (000 Tons) 1.996 1.928 7.605 7.349 (2) Flat Steel Production (000 Tons) 1.857 1.821 7.072 7.400 Long Steel Production (000 Tons) 298 396 1.572 1.563 Flat Steel Shipments

  12. Slide 12: Liquid steel production was 2,4 million tons in 1Q 2017

    Liquid steel production was 2,4 million tons in 1Q 2017 LIQUID STEEL PRODUCTION ( 000 TONS ) 9.373 9.122 8.693 2.441 2.350 2.362 2016 2017 2016 2016 2015 2014 4. Quarter 1. Quarter 12

  13. Slide 13: Crude steel capacity utilization ratio higher than world average

    Crude steel capacity utilization ratio of Erdemir is higher than the world average CRUDE STEEL CAPACITY UTILIZATION RATIO 105% 100% 100% 97% 97% 96% 95% 93% 90% 88% 85% 80% 78% 78% 76% 75% 70% 69% 70% 70% 65% 2012 2013 2014 2015 2016 2017 3M Erdemir World 13 Source: Worldsteel

  14. Slide 14: Production was 2,2 million tons in 1Q 2017

    Production was 2,2 million tons in 1Q 2017 PRODUCTION VOLUMES ( 000 TONS ) 8.963 8.644 8.107 1.563 1.572 1.153 1.820 1.781 1.746 2.155 2.217 5.291 5.580 2.154 5.208 298 441 396 393 466 458 1.320 1.391 1.363 2016 2017 2016 2016 2015 2014 4. Quarter 1. Quarter Hot Cold Long 14

  15. Slide 15: Sales volume was 2 million tons in 1Q 2017

    Sales volume was 2 million tons in 1Q 2017 SALES VOLUMES ( 000 TONS ) 8.750 8.781 8.096 1.587 1.552 1.163 1.860 1.845 1.788 2.405 2.045 2.289 5.303 5.384 5.145 459 300 398 484 459 502 1.462 1.286 1.389 2016 2017 2016 2016 2015 2014 4. Quarter 1. Quarter Hot Cold Long 15 *The Group exported 25 thousa

  16. Slide 16: Net sales revenue increased by 30% in 1Q 2017 YoY

    Net sales revenue increased by 30% in 1Q 2017 YoY NET SALES REVENUE ( MILLION USD ) 5.252 4.382 627 3.855 435 517 4.625 3.947 1.146 1.135 3.338 191 180 875 93 955 955 782 2016 2017 2016 2016 2015 2014 4. Quarter 1. Quarter Domestic Export 16

  17. Slide 17: Sales to packaging and automotive sectors increased in 1Q 2017

    Sales to packaging and automotive sectors increased in 1Q 2017 YoY 3M 2017 FLAT STEEL DOMESTIC SALES BREAKDOWN (%) 3M 2016 FLAT STEEL DOMESTIC SALES BREAKDOWN (%) 119Kt; 149Kt; 79Kt; 8% 103Kt; 9% 5% 6% 189Kt; 12% 183Kt; 1.536Kton; 737Kt; 11% 1.700Kton; 798Kt; 88% 48% 90% 47% 67Kt; 4% 60Kt; 3% 74Kt;

  18. Slide 18: Flat steel sales to EU countries was 70% of flat export

    Flat steel sales to EU countries was 70% of our flat export in 1Q 2017 3M 2017 FLAT STEEL EXPORTS BREAKDOWN (%) 3M 2016 FLAT STEEL EXPORTS BREAKDOWN (%) 9Kt; 4Kt; 3Kt;4% 10Kt; 2% 7Kt; 1% 5% 4% 35Kt; 17% 209Kton; 43Kt; 22% 191Kton; 16Kt; 8% 12% 10% 127Kt; 67% 146Kt; 70% 3M 2017 LONG STEEL EXPORTS BRE

  19. Slide 19: Average flat and long steel prices in 2017 1Q

    19 Mar-15 Mar-15 USD/TON USD/TON Apr-15 Apr-15 May-15 May-15 Jun-15 Jun-15 Jul-15 Jul-15 Aug-15 Aug-15 Sep-15 Sep-15 Oct-15 Oct-15 Nov-15 Nov-15 Dec-15 Dec-15 Jan-16 Jan-16 Feb-16 Feb-16 Erdemir Group Flat Sales Price Erdemir Group Long Sales Price Mar-16 Mar-16 Apr-16 Apr-16 May-16 May-16 Jun-16 Ju

  20. Slide 20: Net profit increased by 339% in 1Q 2017 YoY

    Net profit increased by 339% in 1Q 2017 YoY 1.200 EBITDA ( MILLION USD ) 40,0% 1.000 32,0% 31,6% 1.136 800 26,4% 23,2% 24,0% 600 21,6% 895 17,6% 16,0% 400 14,2% 770 200 359 8,0% 302 0 124 0,0% 2016 2017 2016 2016 2015 2014 4. Quarter 1. Quarter EBITDA EBITDA Margin 800 NET PROFIT ( MILLION USD ) 30,

  21. Slide 21: EBITDA was 359 million USD in 1Q 2017

    EBITDA was 359 million USD in 1Q 2017 Consolidated EBITDA => Consolidated Net Profit (Million USD) 21

  22. Slide 22: EBITDA used for working capital

    EBITDA, which was generated in 1Q 2017, was used for working capital Consolidated EBITDA => Consolidated Net Cash (Million USD) 22

  23. Slide 23: EBITDA per ton for flat product was 186 USD/ton

    EBITDA per ton for flat product was 186 USD/ton in 2017 1Q EBITDA PER TON (USD/TON) * 186 153 150 148 141 143 144 143 135 130 124 113 142 135 121 100 126 125 108 119 100 118 111 113 97 113 88 107 101 92 89 94 74 59 61 64 67 45 54 49 43 24 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1

  24. Slide 24: Net assets were 4,3 billion USD at end of 1Q 2017

    Net assets were 4,3 billion USD at the end of 1Q 2017 CONSOLIDATED NET ASSETS (MILLION USD) WORKING CAPITAL (MILLION USD) 24

  25. Slide 25: Despite the high dividend payments, there is no net debt

    Despite the high dividend payments, there is no net debt BORROWINGS (MILLION USD) 2.479 1.135 1.640 1.452 1.472 693 1.283 891 1.023 1.114 1.030 368 654 1.344 619 947 529 581 655 460 411 14 (190) (282) 2012 2013 2014 2015 2016 2017 3M Long-Term Debt Short-Term Debt Net Debt 25

  26. Slide 26: Net debt was positive at the end of 1Q 2017

    Net debt was positive at the end of 1Q 2017 NET DEBT (MILLION USD) 26

  27. Slide 27: Erdemir has 1.313 million USD cash at end of 1Q 2017

    Erdemir has 1.313 million USD cash and cash equivalents at the end of 1Q 2017 BORROWINGS MATURITY PROFILE (MILLION USD) 563 14 1.313 234 179 12 144 7 99 315 3 31 167 137 1 96 30 Mar.17 2017 2018 2019 2020 2021 Cash Apr.-Dec. Principal Revolving Trade Financing Loans Interest 27

  28. Slide 28: Raw materials made up 72% of the cost of sales

    Raw materials made up 72% of the cost of sales COST OF SALES BREAKDOWN* - % 5% 6% 5% 0,3% 5% 1% 6% 0,05% 0,2% 5% 5% 7% 6% 8% 7% 7% 11% 12% 12% 14% 72% 65% 70% 71% 2017 3M 2016 2015 2014 Raw Materials Personnel Expenses Purchased Energy Expenses Depreciation and Amortization Exp. Non-operating Expens

  29. Slide 29: Conversion cost per ton was 104 USD/ton in 1Q 2017

    Conversion cost per ton excluding depreciation was realised as 104 USD/ton in 1Q 2017 MAIN PRODUCT CONVERSION COSTS ( USD/TON ) 200 2800 180 2.352 2.359 2.187 2.217 160 2.045 2.067 2.131 2.141 2.065 2.065 2.112 2.161 2.154 2.155 2300 1.991 1.910 140 1.540 1800 120 100 1300 80 66 69 65 68 61 62 60 59

  30. Slide 30: Capital expenditures of 595 million USD planned for 2017

    Capital expenditures of 595 million USD is planned for 2017* ( M USD ) 1.017 718 634 595 961 445 675 458 576 264 242 377 200 201 158 162 162 162 171 159 143 113 107 82 110 140 31 20 137 68 56 59 57 93 83 55 80 88 52 43 17 11 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2017 (B) 3

  31. Slide 31: Number of employees was 12.072 as of March 2017

    Number of employees was 12.072 as of March 2017 NUMBER OF EMPLOYEES 13.045 12.872 12.801 12.659 12.277 12.072 2012 2013 2014 2015 2016 2017 March 31

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