El Ezz Aldekhela Steel-Alexandria · EGX:IRAX
El Ezz Aldekhela Steel-Alexandria — ezzsteel — H1 2010 Earnings Presentation
20 slides from El Ezz Aldekhela Steel-Alexandria's earnings presentation, Aug 26, 2010
Slide 1: First Half 2010 Financial Results Presentation
First Half 2010 Financial Results Presentation 26 August 2010
Slide 2: Disclaimer
Disclaimer ezzsteel ( formerly: Al Ezz Steel Rebars S.A.E. ) or “ESR” give notice that: The particulars of this presentation do not constitute any part of an offer or a contract. The information contained in this presentation may contain certain projections and forward-looking statements that reflec
Slide 3: Key Highlights
Key Highlights Global steel demand has started to show signs of recovery Improved financial performance in H1 2010 Revenues have increased 17% year-on-year Net profit at EGP 241mn; up 150% on H1 2009 Our flat steel facility, EFS, returned to production at the start of Q2 2010 We have installed addit
Slide 4: Steel Market Overview
Steel Market Overview World Crude Steel Production 1,400 1,346 1,326 1,247 1,220 1,200 270 270 1,144 1,071 256 245 1,000 970 242 124 114 904 226 Million Tonnes 120 98 848 851 120 119 213 113 116 88 800 202 113 186 189 133 125 82 706 112 106 132 101 113 139 128 600 98 100 111 128 210 198 552 108 134
Slide 5: Overview of Domestic Steel Market
Overview of Domestic Steel Market Egypt Consumption 4,500 4,210 4,000 3,396 3,500 3,097 ‘000 Tonnes 3,000 2,406 2,500 2,028 1,725 1,871 2,000 1,584 1,487 1,384 1,500 1,000 520 532 574 553 572 534 279 275 345 377 500 - H1 2002 H1 2003 H1 2004 H1 2005 H1 2006 H1 2007 H1 2008 H1 2009 H2 2009 H1 2010 Lo
Slide 6: Domestic Market Leader
Domestic Market Leader… H1 10 Long Product Market Share Breakdown H1 10 Flat Product Market Share Breakdown Beshay 10% EISCO 14% ezzsteel 45% ezzsteel 43% Al Garhi 14% Bourieni 3% Marakby 1% Others 10% Imports 43% Imports 16% Estimated local market size of 3,396 thousand tonnes Estimated local marke
Slide 7: H1 2010 Key Highlights
H1 2010 Key Highlights Production Revenue 2,500 2,447 8,000 7,506 2,400 7,500 EGP Millions '000 Tonnes 2,300 7,000 6,420 2,200 2,157 6,500 2,100 6,000 2,000 5,500 H1 2009 H1 2010 H1 2009 H1 2010 EBITDA Net Income 1,400 1,206 241 1,200 250 1,000 200 EGP Millions 845 EGP Millions 800 150 600 96 100 40
Slide 8: H1 2010 Production
H1 2010 Production 1,000 953 927 799 800 735 600 470 489 400 231 200 0 EZDK Long EZDK Flat ezzsteel Long EFS Flat H1 2009 H1 2010 8 8
Slide 9: H1 2010 Sales Breakdown
H1 2010 Sales Breakdown By Product By product in EGP million By Market By market in EGP million Export 1,452 Flat 2,284 19% 31% Long 5,138 69% Domestic 6,054 81% ezzsteel continues to generate the largest portion of its revenues in its growing domestic market, where we enjoy a leading position 9 9
Slide 10: H1 2010 Revenues
H1 2010 Revenues Consolidated revenues Ezzsteel EGP Mn ESR/ERM EZDK EFS Consolidated Long 2,404 2,734 - 5,138 Flat - 1,620 665 2,284 Others - 79 5 84 Total 2,404 4,433 670 7,506 Standalone 2,728 4,372 681 Revenues 10 10
Slide 11: H1 2010 Cost Breakdown
H1 2010 Cost Breakdown ezzsteel EGP Million ESR/ERM EZDK EFS Consolidated Sales 2,728 4,372 681 7,506 COGS 2,605 3,365 737 6,412 COGS/Sales 95% 77% 108% 85% 100% 90% Depreciation & Overheads 80% Labour 70% Energy 60% Raw Materials 50% 40% 30% 20% 10% 0% ESR/ERM EZDK EFS Ezz Steel Consolidated 11 11
Slide 12: H1 2010 Profitability
H1 2010 Profitability Operational profits EBITDA breakdown by division 1500 1,350 1,206 1206 1,073 1094 845 EGP Millions EGP Millions 1000 741 845 850 761 500 207 350 107 -129 6 0 -150 Gross Profit EBITDA EZDK ESR/ERM EFS Consolidated H1 2009 H1 2010 H1 2009 H1 2010 Profitability per tonne 600 549 6
Slide 13: Commitment to Growth Strategy
Commitment to Growth Strategy Existing Capacity Domestic Expansions Post Domestic Expansion Regional Expansions Post Regional Expansion 10.0 10.0 3.0 3.0 7.0 7.0 1.2 3.8 mn tpa 5.8 3.2 Existing Existing Additional Additional Domestic Domestic Algeria Algeria Total Total DRI Finished DRI Finished DRI
Slide 14: Outlook
Outlook In a general context of sharp volatility, we expect demand and prices of steel products to improve gradually during the second half of 2010 Our current expansion efforts are focused on vertical integration and flexibility, which includes expanding our DRI capacity and adding long product pro
Slide 15: Q&A
Q&A
Slide 16: Divisional Review: EZDK
Divisional Review: EZDK EZDK (Alexandria) H1 2009 H1 2010 Sales: Value: EGP 4.3bn EGP 4.4bn Volume: Long: 925 thousand ton 817 thousand ton Flat: 492 thousand ton 450 thousand ton Exports as % of Sales: Long: 2% 4% Flat: 55% 46% EBITDA: EGP 0.8bn EGP 1.1bn Production: Long Products: 953 thousand ton
Slide 17: Divisional Review: ESR/ERM
Divisional Review: ESR/ESR ESR/ERM ( Sadat City & 10th of H1 2009 H1 2010 Ramadan) Sales: Value: Long: EGP 2.1 bn EGP 2.4bn Other: 324 thousand ton Volume: Long: 657 thousand ton 728 thousand ton EBITDA: EGP 207mn EGP 107mn Production: Long Products: 735 thousand ton 799 thousand ton Billets: 418 th
Slide 18: Divisional Review: EFS
Divisional Review: EFS EFS (Suez) H1 2009 H1 2010 Sales: Value: EGP 257mm EGP 681mm Flat: EGP 65mn EGP 665mn Other: EGP 191mn EGP 16mn Volume: Flat: 31 thousand ton 194 thousand ton Exports as % of Sales: 100% 92% EBITDA: EGP -129mn EGP 6mn Production: Flat Products: 231 thousand ton One of the few
Slide 19: ezzsteel at a Glance
ezzsteel at a Glance Ezz Industries Free Float The largest steel producer in the Middle East and Africa with a total actual 66% 34% capacity of 5.8mn tonnes per annum 3.5mn tonnes of long products (Rebar) 2.3mn tonnes of flat products (HRC) ezzsteel is listed on the Egyptian Stock 55% 34% 99% Exchan
Slide 20: Relative Share Performance Vs EGX30
Relative Share Performance Vs EGX30 Share Data: 52wk High on 15th of April 2010: 24.52 EGP 52wk Low on 27th of August 2009: 14.58 EGP Avg. Daily Traded Volume: 1.5 mn Shares Market Cap: 10 bn EGP ESRS EGX30 20 20