SSab AB Class A · OMXSTO:SSAB_A
SSab AB Class A — Investor Day (May 2011)
27 slides from SSab AB Class A's investor day presentation, May 24, 2011
Slide 1: Financial update
Financial update Marco Wirén, CFO Capital Markets Day May 24, 2011
Slide 2: Forward-looking statements
Forward-looking statements The presentation and the materials constituting it contain certain statements that are forward-looking statements within the meaning of the U.S. federal securities laws. Actual results could differ materially from the future results expressed or implied by these forward-lo
Slide 3: Highlights – Q1 2011
Highlights – Q1 2011 Steel demand and prices strengthened during the quarter Strong order intake within Material Handling, Heavy Transport and Automotive The North American market performed well Share of niche products 37% (29%) Clear improvement in operating profit compared with Q1-10 Cap
Slide 4: SSAB - Improved demand and prices
SSAB - Improved demand and prices SEK, million Sales EBIT 16 000 3 500 3 000 14 000 2 500 12 000 2 000 10 000 1 500 8 000 1 000 500 6 000 0 4 000 -500 2 000 -1 000 0 -1 500 2/09 1/06 2/06 3/06 4/06 1/07 2/07 3/07 4/07 1/08 2/08 3/08 4/08 1/09 3/09 4/09 1/10 2/10 3/10 4/10 1/11 1/06 2/06 3/06 4/06 1/
Slide 5: Sales by Business Area and region
Sales by Business Area and region Sales by Business Area Sales by Region Tibnor USA 16% Other 29% 34% SSAB APAC SSAB EMEA 6% 42% SSAB Finland Americas 4% 36% Sweden Canada 22% 5% Germany 6% Capital Markets Day, May 24, 2011 5
Slide 6: SSAB customer segment volumes Q1 2011
SSAB customer segment volumes Q1 2011 QT AHSS Ordinary Heavy Transport Heavy Transport Heavy Transport Material Handling Automotive Automotive Construction Machinery Construction Machinery Construction Machinery Industrial Applications & Others Energy Energy Industrial Applications & Others Industri
Slide 7: Sales & EBITDA%
Sales & EBITDA% SSAB EMEA SSAB Americas 7 500 20 4 500 20 10 15 5 000 3 000 10 0 -10 1 500 5 2 500 -20 0 0 -30 0 -5 SALES, MSEK EBITDA, % SALES, MSEK EBITDA, % SSAB APAC Tibnor 800 25 2 500 15 20 2 000 10 600 15 1 500 5 400 10 5 1 000 0 200 0 500 -5 0 -5 0 -10 SALES, MSEK EBITDA, % SALES, MSEK EBITD
Slide 8: Change in operating profit, Q1 2011 vs. Q1 2010
Change in operating profit, Q1 2011 vs. Q1 2010 Change in operating profit, excluding non-recurring items, between the first quarters of 2011 and 2010 (SEK millions) 2 500 480 -1 200 2 000 1 600 1 500 MSEK - 300 1 000 -169 37 616 500 168 0 Q1 2010 Prices Volumes COGS (Variable) FX impact Fixed costs
Slide 9: Operating cash flow
Operating cash flow SEK millions Apr-10- 2010 Q1-11 Q1-10 Mar-11 Fulll year SSAB EMEA 210 -120 -1,406 -1,736 SSAB Americas 60 510 971 1,421 SSAB APAC -93 -94 163 162 Tibnor 79 -56 177 42 Other -19 16 -136 -101 Operating cash flow 237 256 -231 -212 Financial items -106 -74 -424 -392 Taxes -220 265 -6
Slide 10: Balance sheet & Capex
Balance sheet & Capex Capital Markets Day, May 24, 2011 10
Slide 11: Financing & Liquidity
Financing & Liquidity Net debt decreased slightly to SEK 17.4 bn from the previous quarter and the net gearing was 60% Liquidity preparedness as percentage of annual sales (rolling 12 mths) was 30% (incl. commercial paper) The average term on the loan portfolio at 3.1 years with an interest te
Slide 12: Debt Maturity
Debt Maturity 4 500 SEK m 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 2011 2012 2013 2014 2015 2016 2017- Commercial paper amounted to SEK 2,045m (March 31) Capital Markets Day, May 24, 2011 12
Slide 13: Debt Cost
Debt Cost 6 6 Years In % Avg Mat.(rhs) Avg Rte 6mUSD Libor 5 5 4 4 3 3 2 2 1 1 0 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2008 2009 2010 2011 Capital Markets Day, May 24, 2011 13
Slide 14: Plan for depreciation and amortization of surplus values
Plan for depreciation and amortization of surplus values 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 0 US$ m -20 -40 -60 -80 -100 -120 -140 Amortization of surplus values related to the IPSCO acquisition Capital Markets Day, May 24, 2011 14
Slide 15: Capex profile
Capex profile 2 500 Strategic investments Maintenance investments 2 000 1 500 1 000 500 0 2006 2007 2008 2009 2010 Current estimate for Capex in 2011 is SEK 3-3.5bn Capital Markets Day, May 24, 2011 15 15
Slide 16: Raw materials & cost structure
Raw materials & cost structure Capital Markets Day, May 24, 2011 16
Slide 17: Iron ore prices
Iron ore prices The purchase price for iron ore in LKAB ref price FOB Narvik (USD/t) Q1-11 was unchanged in USD, 300 and 12% lower in SEK vs. Q4-10 250 200 The price for the contract year starting April 1, 2011 has not yet 150 been agreed upon with LKAB 100 50 LKAB invoice SSAB the Q1-11 price
Slide 18: Coking coal prices
Coking coal prices As of 2011, 60% of coking coal Market price, Benchmark BMA Coal FOB Aus (USD/t) volumes are sourced from 350 Australia on monthly contracts 300 The April contract was up 59% in 250 USD vs. Q1-11 (28% in SEK) 200 USD/t 150 Price trend for Australian coking 100 coal is slightl
Slide 19: US scrap prices
US scrap prices Scrap prices increased in 3 500 000 $600 Q1-11 vs. Q4-10 3 000 000 $500 2 500 000 $400 Since April, prices have 2 000 000 started to decrease $300 1 500 000 somewhat $200 1 000 000 500 000 $100 - 99-Jan $0 00-Jan 01-Jan 02-Jan 03-Jan 04-Jan 05-Jan 06-Jan 07-Jan 08-Jan 09-Jan 10-J
Slide 20: Cost structure, 2010
Cost structure, 2010 Cost structure Input materials Other Depreciations 5% 6% Alloys Purchased 13% products & services Iron Ore 15% 29% Input Energy materials 7% 46% Personnel Coal costs 20% 13% Other manufacturing Scrap costs 33% 13% MSEK 39,305 MSEK 18,262 Capital Markets Day, May 24, 2011 20
Slide 21: European Emission Rights Market
European Emission Rights Market Current phase II lasts between 2008-2012 - any excess phase II rights are possible to use for compliance in phase III (2013-2020) Most analysts predict further price increases going into phase III. This is supported by current forward prices. Capital Markets Day,
Slide 22: Market Outlook
Market Outlook Capital Markets Day, May 24, 2011 22
Slide 23: The recovery continues
The recovery continues Apparent steel use (million tons) 1600 1400 1200 1000 800 600 400 200 0 2010 2011f 2012f European Union-27 Other Europe CIS NAFTA Central & South America Africa Middle East Asia & Oceania Source: worldsteel, Short Range Outlook 2011-04-19 Capital Markets Day, May 24, 2011 23
Slide 24: Increased crude steel production
Increased crude steel production Global crude steel production (million tonnes/month) 130 110 Global steel production was 90 up 7% in Q1-11 vs. Q4-10 and up 9% vs. Q1-10 70 50 May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr China accounted for 46 % of 2009/2010 2010/2011 global output in Q1-11 %
Slide 25: SSAB key segments continue to recover
SSAB key segments continue to recover Mining demand outlook continues to be Heavy Heavy Transport shows good activity very positive North American heavy truck production Material Transport Positive development especially in was up 38% in Q1-11 vs. Q1-10 Handling emerging markets Signs of i
Slide 26: Market outlook summary
Market outlook summary Growth in global steel consumption is expected to be ~6% in both 2011 and 2012 (WSA) US steel consumption is forecasted to grow as much as 13% in 2011, reflecting higher economic activity Steel consumption within EU is forecasted to grow ~5% in 2011, fuelled by the expor
Slide 27: Questions
Questions Please state your name and the company that you represent Capital Markets Day, May 24, 2011 27