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. — H1 2019 Earnings Presentation
30 slides from Eregli Demir Ve Celik Fabrikalari T.a.s's earnings presentation, Aug 8, 2019
Slide 1: Mining Metallurgy
MINING METALLURGY Gi @ak ))
Slide 2: 2019 6 Months Investor Presentation
2019 6 Months Investor Presentation 08.08.2019
Slide 3: Disclaimer
Disclaimer 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
Slide 4: 2019 Market Overview
ERDEMIR 2019 Market Overview
Slide 5: Crude Steel Production (% yoy) by Region
5 10.0% -5.0% 0.0% 5.0% -10.0% Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-16 Apr-18 10.0% -5.0% -10.0% 0.0% 5.0% May-18 Jun-17 Jun-18 Jul-17 Jul-18 Aug-17 Aug-18 Sep-17 Sep-18 Oct-17 Oct-18 Nov-17 Nov-18 Dec-17 Dec-18 EU28 Crude Steel Production (% yoy) Crude Steel Production
Slide 6: Coking Coal, Iron Ore & Scrap Prices
6 100 150 200 250 300 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 150 200 250 300 350 400 Aug-17 Sep-18 Sep-17 Oct-18 Coking Coal Prices Oct-17 Nov-18 Nov-17 Dec-18 Dec-17 Jan-19 Jan-18 Feb-19 Feb-18 Mar-19 (HCC Peak Downs Region FOB Australia) Mar-18 A
Slide 7: Turkish Steel Production & Consumption
Turkish Steel Production & Consumption Production (mn tons) 36.9 36.9 39.0 38.6 36.1 10.4 10.4 10.9 13.1 13.4 -20.0% 20.5 16.4 7.1 25.7 26.5 26.0 25.9 25.2 6.5 13.4 9.9 2014 2015 2016 2017 2018 6M 2018 6M 2019 Consumption (mn tons) 35.9 34.4 34.1 30.8 30.6 16.5 16.5 17.8 -32.6% 14.6 14.8 18.1 8.8 12
Slide 8: Turkish Steel Exports & Imports
Turkish Steel Exports & Imports Exports (mn tons) 17,8 1,0 17.9% 14,1 13,4 14,4 13,1 0,6 0,3 0,8 6,1 9.2 2,5 0,3 7.8 2,6 3,1 4,3 0.9 0.2 2.7 3.1 11,0 10,2 10,0 9,3 10,7 4.9 5.2 2014 2015 2016 2017 2018 6M 2018 6M 2019 Imports (mn tons) 18,1 16,5 15,3 13,0 7,9 13,6 -32.9% 6,2 4,8 4,8 8.2 4,8 3.1 5.5
Slide 9: 2019 6M Results
ERDEMIR 2019 6M Results
Slide 10: Operational and Financial Highlights
Operational and Financial Highlights Operational Highlights 2017 2018 6M 2018 6M 2019 Growth (YoY) Liquid Steel Production (000 tons) 9,392 9,322 4,716 4,516 -4.2% Flat Steel Production* (000 tons) 7,713 7,743 3,923 3,776 -3.7% Long Steel Production (000 tons) 1,328 980 452 522 15.5% Flat Steel Ship
Slide 11: Liquid Steel Production (000 tons)
Liquid Steel Production (000 tons) 9,373 9,392 9,322 4,716 4,516 2,316 2,369 2,147 2016 2017 2018 6M 2018 6M 2019 Q2 2018 Q1 2019 Q2 2019 11
Slide 12: Crude Steel Capacity Utilization Ratio
Crude Steel Capacity Utilization Ratio 100% 97% 97% 97% 96% 93% 94% 78% 76% 72% 70% 69% 2013 2014 2015 2016 2017 2018 6M 2019 Erdemir World* 12 As of August 2018, Worldsteel no longer publishes global capacity utilization ratio for anti-trust reasons. Source: Worldsteel
Slide 13: Production (000 tons)
Production (000 tons) 9,041 8,644 8,723 1,328 980 1,572 1,822 1,701 4,375 4,298 1,781 452 522 866 781 2,164 2,141 2,157 201 315 207 5,891 6,042 435 403 378 5,291 3,057 2,995 1,528 1,423 1,572 2016 2017 2018 6M 2018 6M 2019 Q2 2018 Q1 2019 Q2 2019 Hot Cold Long Slab production for 3rd parties was inc
Slide 14: Sales Volume (000 tons)
Sales Volume (000 tons) Total sales increased by 4.3% YoY in Q2 2019. 8,750 8,958 8,401 1,364 1,587 919 +2.9% 1,908 1,750 4,322 1,860 4,199 422 540 +4.3% 888 853 2,222 2,100 2,013 173 336 204 5,686 5,732 430 451 402 5,303 2,889 2,929 1,410 1,435 1,494 2016 2017 2018 6M 2018 6M 2019 Q2 2018 Q1 2019 Q
Slide 15: Net Sales Revenue (USD mn)
Net Sales Revenue (USD mn) 5,598 5,140 1,163 733 3,855 2,845 517 2,601 486 620 4,407 4,435 1,423 1,333 1,268 281 3,338 352 268 2,359 1,981 1,142 981 1,000 2016 2017 2018 6M 2018 6M 2019 Q2 2018 Q1 2019 Q2 2019 Export Domestic 15
Slide 16: Flat & Long Steel Domestic Sales Breakdown
Flat & Long Steel Domestic Sales Breakdown Flat Steel Domestic Sales 13% 13% (386) (409) 18% Pipe&Profile and Rolling 19% (526) 2,916K ton (602) 3,151K ton 52% 57% Distribution Chains 6M 2018 (1,632) 6M 2019 (1,652) General Manufacturing Industry 12% Automotive 16% (352) (508) Long Steel Domestic Sa
Slide 17: Export Volume (000 tons)
Export Volume (000 tons) Total export volume increased by 55.9% YoY in 6M 2019. 19.4% 23.4% 1,631 15.4% 13.4% 12.4% +55.9% 1,199 1,012 1,086 25.5% 21.2% 17.8% 567 649 445 358 2016 2017 2018 6M 2018 6M 2019 Q2 2018 Q1 2019 Q2 2019 Export Share in Total Sales 17
Slide 18: EBITDA & Net Profit
EBITDA & Net Profit EBITDA (USD mn) EBITDA Margin (%) 29.1% 30.7% 23.2% 32.3% 23.9% 33.8% 24.3% 23.6% 1,496 1,720 919 622 481 895 323 299 2016 2017 2018 6M 2018 6M 2019 Q2 2018 Q1 2019 Q2 2019 Net Profit* (USD mn) Net Profit Margin (%) 20.0% 20.7% 13.0% 24.7% 22.2% 14.0% 17.7% 15.8% +20,8% 1,030 1,1
Slide 19: EBITDA to Net Profit
EBITDA Net Profit 622 (102) 107 519 (197) (1) 1 (19) 411 EBITDA Depreciation Interest Operating Investing Finance Tax Inc./(Exp.) Non- Net Profit 6M 2019 Inc./(Exp.) Income Activities Inc./(Exp.) Controlling 6M 2019 on Other Inc./(Exp.) Interests Operating Inc./(Exp.) 19
Slide 20: EBITDA to Net Cash
EBITDA Net Cash 22 201 (189) 622 (89) (48) 519 (794) (70) (39) (384) EBITDA Changes Interest Taxes Paid Net Cash Cash Flow Free Cash Dividend Credit Usage/ Other Change 6M 2019 in Working Inc./(Exp.) used in from Flow Paid (Payment) in Cash Capital Net Investing Financial Net 6M 2019 Activities Inve
Slide 21: EBITDA per Ton (USD/ton)
EBITDA per Ton* (USD/ton) 223 219 197 174 179 172 138 141 143 139 145 105 96 85 119 51 43 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Main Product 21 *One-off income/expense items are excluded.
Slide 22: Financial Figures
Financial Figures Consolidated Net Assets (USD mn) 31.12.2018 30.06.2019 Growth (YoY) Cash and Cash Equivalents 1,646 1,269 -23% Working Capital 2,219 2,018 -9% Tangible and Intangible Assets 3,533 3,512 -1% Financial Liabilities (1,163) (1,147) -1% Provisions and Other (674) (569) -16% Net Assets 5
Slide 23: Financial Borrowings (USD mn)
Financial Borrowings (USD mn) 891 368 654 829 897 755 529 581 655 460 362 353 14 266 (190) (161) (482) (675) 2014 2015 2016 2017 2018 6M 2019* Net Debt Short-Term Debt Long-Term Debt 23 *TFRS 16 Leases are excluded.
Slide 24: Net Debt (USD mn)
Net Debt (USD mn) 519 (794) 482 (46) 161 Net Cash Free Cash Flow Dividend Paid Other Net Cash Dec. 2018 June 2019 24
Slide 25: Borrowings Maturity Profile (USD mn)
Borrowings Maturity Profile (USD mn) 1,269 491 22 387 43 342 170 163 18 93 127 174 145 4 25 9 89 24 1 1 8 June 2019 Jul.-Dec. 2020 2021 2022 2023 2024 Cash 2019 Principal Revolving Trade Financing Loans Interest 25
Slide 26: Cost of Sales Breakdown (%)
Cost of Sales Breakdown* (%) 7 6 5 7 7 5 5 5 5 5 8 6 11 9 7 Raw Materials 14 Personnel Expenses Purchased Energy Expenses Depreciation and Amortization Exp. 73 76 75 64 Other 2016 2017 2018 6M 2019 Raw Materials Breakdown (%) 24 20 22 19 13 12 12 11 Iron Ore&Pellet 27 35 35 36 Coal Scrap Other 36 33
Slide 27: Capital Expenditures (USD mn)
Capital Expenditures (USD mn) 264 242 208 216 200 201 171 162 162 162 158 159 113 132 143 82 165 107 110 140 83 93 83 80 88 84 71 57 55 52 43 17 12 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 6M 2019 Capital Expenditures Fixed Assets Acquisition 27
Slide 28: Number of Employees
Number of Employees 12,872 12,659 12,277 11,975 11,607 11,530 2014 2015 2016 2017 2018 June 2019 28
Slide 29: Appendix – EBITDA Detail
Appendix – EBITDA Detail 01.01.2019- 01.01.2019- Note 30.06.2019 30.06.2019 (Thousand USD) (Thousand TRY) Presentation Currency Translation 2.1 5.6118 Operating Profit 519,178 2,913,520 Depreciation and Amortisation Expenses 102,012 572,476 Cost of Sales 14 92,927 521,487 Marketing Expenses 15 3,701
Slide 30: Erdemir Investor Relations
Erdemir Investor Relations investorrelations@erdemir.com.tr https://www.erdemir.com.tr/investor-relations/ +90 216 578 80 61 30
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