Ferroglobe Plc · NASDAQ:GSM
Ferroglobe — Q3 2020 Earnings Presentation
24 slides from Ferroglobe's earnings presentation, Nov 24, 2020
Slide 1: Advancing Materials Innovation Third Quarter 2020
Advancing Materials Innovation NASDAQ: GSM Third Quarter 2020
Slide 2: Forward-Looking Statements and non-IFRS Financial Metrics
Forward-Looking Statements and non-IFRS Financial Metrics This presentation contains forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. Forward-looking
Slide 3: Table of Contents
Table of Contents Q3 2020 Business review Q3 2020 Financial review Update on strategic plan Appendix — Supplemental information
Slide 4: Q3 Opening Remarks
Q3 Opening Remarks Stable financial results despite continued uncertainty and challenges created by COVID-19 Sustainable level of cash to operate the business by continued focus on cost cutting and additional cash generation measures Execution of strategic plan underway — strong momentum across all
Slide 5: I. Q3 2020 Business review
I. Q3 2020 Business review
Slide 6: Key highlights
Key highlights Q3-20 results: Sales of $262.7 million, compared to $250.0 million in Q2-20 and $381.7 million in Q3-19 Adjusted EBITDA of $22.2 million compared to $22.4 million in Q2-20 and ($7.2) million in Q3-19 Positive Operating Cash Flow of $23.0 million partially offset by the senior notes co
Slide 7: Product category snapshot: Silicon metal
Sequential quarters EBITDA evolution ($m) Commentary Product category snapshot ─ silicon metal Volume trends Pricing trends ($/mt) Averaged realized price up 1.5% primarily due to higher exposure to chemical grade end market Limited spot sale opportunities US index pricing flat, while European index
Slide 8: Product category snapshot: Silicon-based alloys
Product category snapshot: Silicon-based alloys Volume trends Pricing trends ($/mt) Sequential quarters EBITDA evolution ($m) Commentary Average realized price flat versus prior quarter – benefit from product mix (foundry) Sharp decline in the index price in the US and Europe, particularly in the fi
Slide 9: Product category snapshot: Manganese-based alloys
Product category snapshot: Manganese-based alloys Volume trends Pricing trends ($/mt) Sequential quarters EBITDA evolution ($m) Commentary Averaged realized prices declined by 7% relative to Q2 European index price for ferromanganese declined 14% while the index silicomanganese declined by 12% Q3 vo
Slide 10: II. Q3 2020 Financial review
II. Q3 2020 Financial review
Slide 11: Income Statement 2020: Q3-20 vs Q2-20
Income Statement 2020 ($’000): Q3-20 vs Q2-20 Sales improvement driven by volumes Cost of sales impacted by higher energy in Spain, partially offset by continued cost cutting at corporate and plant levels Q3 staff costs includes severance payments; Q2 reflects the reversal of 2019 incentive compensa
Slide 12: Adjusted EBITDA bridge: Q2-20 to Q3-20
* Adjusted EBITDA bridge: Q2-20 to Q3-20 ($m) Positive pricing in chemical grade silicon metal and foundry products offset by manganese and ferrosilicon Volume benefits primarily attributable to silicon metal (+7%) and foundry product (+29%) Cost includes partial reversal of previously recorded liab
Slide 13: Balance sheet summary
Balance sheet summary Notes: Financial results are unaudited Gross debt excludes bank borrowings arising from consolidation of the A/R securitization at Sep. 30, 2019, Jun. 30, 2020 and Sep. 30, 2020 Capital is calculated as book equity plus net debt Cash and restricted cash includes the following a
Slide 14: Quarterly cash flow statement
Quarterly cash flow statement ($’000) Free cash flow is defined as ‘Cash Flow From Operating Activities’ less ‘Payments for Capital Expenditure’ $33 million of cash from the sale of CO2 emission rights New COVID assistance loans by governments in France and Canada Bank payments relates to the coupon
Slide 15: Working capital and cash evolution
Working capital and cash evolution ($m) Working capital trends ($m) Cash trends ($m) Working capital increase driven by a reduction in accounts payable and the strengthening of the Euro 579 474 348 321 354 579 474 348 321 354 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 188 123 144 153 147 Q3-19 Q4-19 Q1-20 Q2-20
Slide 16: Debt Evolution
Debt Evolution ($m) Gross and net debt evolution ($m) The decrease in Q3-20 gross debt is due to the $16.4 million coupon payment and $7.8 million ABL paydown, partially offset by $8.2 million bond interest accrued and $5 million from a loans supported by the French and Canadian governments 556 481
Slide 17: Financing update
Financing update COVID-19 related government funding French government (BPI) granted Ferroglobe France €4.3 million as COVID-19 related financial assistance Canadian government, through Investissment Quebec, granted Quebec Silicon LP CAD$7 million for capex Successful refinancing of existing A/R pro
Slide 18: III. Update on strategic plan
III. Update on strategic plan
Slide 19: Update on the strategic plan
Update on the strategic plan Transformation journey underway — significant moment across all value creation levers Rollout throughout the organization with 80+ cross-functional teams Reaffirmation of financial targets with potential for upside
Slide 20: Q&A
Q&A
Slide 21: IV. Appendix — Supplemental information
IV. Appendix — Supplemental information
Slide 22: Quarterly trend – revenue contribution and adjusted EBITDA
Quarterly trend – revenue contribution per family of products ($m) Quarterly trend – adjusted EBITDA ($m) Quarter sales and adjusted EBITDA ($m) Note: The amounts for prior periods have been restated to show the results of the Company’s Spanish hydroelectric plants within (Loss) profit for the perio
Slide 23: Gross debt at September 30, 2020
Gross debt at September 30, 2020 Notes: 1. The Company adopted IFRS 16 with effect from January 1, 2019, resulting in the recognition of liabilities for operating leases. Operating leases are excluded from the Company’s presentation of gross debt consistent with the balance sheet prior to IFRS 16 2.
Slide 24: Advancing Materials Innovation Third Quarter 2020
Advancing Materials Innovation NASDAQ: GSM Third Quarter 2020