Eramet Sa · EURONEXT:ERA
Eramet Sa — Shareholder Meeting (May 2023)
39 slides from Eramet Sa's shareholder meeting presentation, May 23, 2023
Slide 1: Eramet
> eramMer
Slide 2: Disclaimer
Disclaimer Certain information contained in this presentation including any information on Eramet’s plans or future financial or operating performance and any other statements that express management’s expectations or estimates of future performance, constitute forward- looking statements. Such stat
Slide 3: Presentation of the Group's situation in 2022, outlook and strategic roadmap
Presentation of the Group’s situation in 2022, its outlook and its strategic roadmap Christel BORIES Chair & CEO Nicolas CARRE CFO, in charge of Procurement and IT
Slide 4: Contents
Contents 1– 2022 retrospective 2– 2022 financial results & stock evolution 3– Purpose & strategic positioning 4– Decarbonation roadmap 5– Q1 2023 key trends Conclusion & outlook 4 Ordinary Shareholders’ General Meeting – 23 May 2023
Slide 5: 2022 retrospective
1 2022 retrospective Unless otherwise specified, financial figures are presented in accordance with IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations -, in line with Eramet’s new scope focused on the Mining & Metals division.
Slide 6: 2022: a landmark year for Eramet
2022: a landmark year for Eramet 1 Record year with historical operational and financial performance 2 Strong CSR performance, outperforming roadmap targets in 2022 3 Finalisation of repositioning in Mining & Metals activities 4 Acceleration in metals for the energy transition 5 2022 cash allocation
Slide 7: Record year with historical operational and financial performance
Record year with historical operational & financial performance as well as very strong deleveraging Metallurgical Mining volume Price €1.9bn1 production growth impact control Optimised manganese +€960m 2022 +7% > 2x alloys production Adjusted EBITDA produced marketed to address high energy Input in
Slide 8: Strong mining operational performance, challenging context for metallurgical activities
Strong mining operational performance, challenging context for metallurgical activities mainly due to energy price surge 25 28 22 40 Continuous Exceptional growth incremental growth performance Mineral sands Weda 21.1 Mwmt1 GCO & ETI Manganese 7.5 Mt ore sold Bay Ore ore produced > 2x Nickel +7% Rob
Slide 9: Accomplished ESG performance, outperforming roadmap targets in 2022
Accomplished ESG performance, outperforming roadmap targets in 2022 CSR roadmap Carbon intensity3 CSR 115% Outperforming global annual performance targets -40% vs. 2018 Safety: #1 priority Biodiversity One of the FR2 at Fatalities 1.2 lowest 0.9 industry 1.12 0 0.5 2011-2013 2014-2018 2019-2022 rate
Slide 10: A CSR commitment and performance recognized by rating agencies
A CSR commitment and performance recognized by rating agencies A- Climate change B- 73/100 B- Prime Water security Gold medal Among the best in Among the best in Top 3% in the M&M sector the industry the industry 26.11 66/100 Advanced 2nd decile 9/144 3/44 in the M&M sector in the M&M sector in the
Slide 11: 2022 financial results & stock evolution
2 2022 financial results & stock evolution
Slide 12: Net income Group share of €740m
Net income Group share of €740m €m 2022 2021 Turnover 5,014 3,668 Adjusted EBITDA1 1,897 1,204 EBITDA 1,553 1,051 Current operating income 1,280 784 Net income – Continuing operations 930 791 Net income – Discontinued operations (156) (426) Net income – Group share 740 298 €m 31/12/2022 31/12/2021 N
Slide 13: 2022 cash allocation focused on deleveraging and growth capex
2022 cash allocation focused on deleveraging and growth capex Robust FCF generation to enable strong deleveraging and development of growth capex, while rewarding our shareholders in line with the Group’s policy 1 2 3 Deleveraging Growth capex Dividends 0.2x €200m €3.5/share2 Leverage1 at end-2022 G
Slide 14: Very high liquidity to address future maturities
Very high liquidity to address future maturities Group financial liquidity (€m) Key considerations Undrawn line: RCF & term loan Available cash €2.8bn liquidity available 3,000 2,810 Eramet has at all times maintained strong liquidity 2,596 2,500 through the cycle, with no cash trapped in the 2,012
Slide 15: A value accretive stock, long-term
A value accretive stock, long-term Eramet, SBF 120, STOXX Europe 600 Basic Resources since 2020 (100 basis) Performance €46 €43 €72 €84 31/12/2019 31/12/2020 31/12/2021 31/12/2022 TSR1 400 19% in 2022 350 86% over the last 3 years2 300 250 SBF 120 200 13th best 19/05/2023 performance in 2022 €91 150
Slide 16: A historical & stable shareholding
A historical & stable shareholding Shareholding at 31/12/2022 APE1 27.1% US institutionals 6.1% Individual shareholders 9.8% STCPI2 4.0% Number of Institutional French shares issued institutionals shareholders 4.3% 19.4% 28,755,047 Treasury UK shares 31.8% institutionals 0.7% Other 1.7% Others 37.1%
Slide 17: Purpose & strategic positioning
3 Purpose & strategic positioning
Slide 18: Successful strategic repositioning: focused on the upstream of the metals value chain
Successful strategic repositioning: Eramet becomes a player focused on the upstream of the metals value chain 1 2 3 FIX / REPOSITION GROW EXPAND our portfolio in metals for the our least performing assets in our attractive businesses energy transition Ore production organic A&D divested Lithium grow
Slide 19: Our purpose, our reason for acting
Our purpose, our reason for acting “ Become a reference for the responsible SUSTAINABLE VALUE CREATOR transformation of the Earth’s mineral resources for ‘living well’ together ” BUSINESS PARTNER ENTREPRENEUR OF CHOICE Develop a selective portfolio of value- Strategic transformation 1 accretive mini
Slide 20: The world will need new metals, and more metals
The world will need new metals, and more metals 1200 BC 1700 1800 1900 2000 C Cu Fe C Cu Fe C Ca Co Al C Ca Ce Co Cr Al Ag C Ca Cd Ce Cu Fe Mn Cu Fe Mg Mn Mo Ni Co Cr Cu Fe Ga Ge Pb Sn W Pb Pt Si Sn Th Ti In K Li Mg Mn Mo C W Zr Nb Ni P Pb Pt Re ree Rh Ru Si Sn Ta Th Ti U V W Zr A pivotal mission fo
Slide 21: A strategic roadmap based on 2 pillars, supported by strong CSR commitments
A strategic roadmap based on 2 pillars, supported by strong CSR commitments Grow in metals supporting Sustainably develop critical global economic development metals for the energy transition Resilient markets Fast-growing markets MANGANESE ORE & ALLOYS LITHIUM NICKEL NICKEL/COBALT FOR BATTERIES MIN
Slide 22: Eramet is accelerating in the energy transition
Eramet is accelerating in the energy transition Solid fundamentals to speed up the Group’s ambitious, promising projects in metals for the energy transition Plant construction Centenario in progress Sonic Bay Good progress (Argentina) 24kt per year LCE (Indonesia) with BASF Phase 1 Battery-grade Lit
Slide 23: Centenario (Phase 1): key metrics of a Tier 1 project
3 Centenario (Phase 1): key metrics of a Tier 1 project Key financial metrics – Phase 1 Key operational metrics – Phase 1 c.$300m At full ramp-up1 24,000 Yearly production at full ramp-up EBITDA Based on a $17,800/t LCE Tonnes of LCE4 LT consensus CIF price Battery-grade LCE at 100% Eq. 500k vehicle
Slide 24: Decarbonation roadmap
4 Decarbonation roadmap
Slide 25: The Group has significantly reduced the carbon intensity of its products since 2018
The Group has significantly reduced the carbon intensity of its products since 2018 Carbon intensity1 of Eramet's products (tCO2/t outgoing product) 0.5 CSR roadmap 2018-2023 Target -26% SLB2 financing 0.4 vs. 2018 framework Achieved -40% vs. 2018 Target -35% Target -40% 0.3 vs. 2019 vs. 2019 0.2 0.
Slide 26: Eramet is firmly committed to fighting climate change
Eramet is firmly committed to fighting climate change Validation of the Group's CO2 absolute emissions reduction target “well below 2°C” 2023-2035 decarbonation capex by SBTi 0.4Mt -13% 0.3Mt -40% €500m Eramet’s direct investments Contribute to carbon 3.7Mt neutrality 3.3Mt Additional substantial in
Slide 27: Decarbonation projects on pyrometallurgical operations
Decarbonation projects on pyrometallurgical operations… c.90% of Eramet’s energy consumption & GHG emissions1 Sourcing of Energy efficiency Replacement of CCS2 CO2 free power improvement carbon reductants development Dunkirk (France) SLN (New Caledonia) Mn alloys production Capture, liquefaction & d
Slide 28: …and decarbonation of mining operations
…and decarbonation of mining operations… Eramet’s energy consumption & c.10% of GHG emissions1 Solar farm project Electrification at GCO (Senegal) of mining trucks Off-grid solar plant to be With solutions already commissioned in 2024 available on the market CO2 emissions reduction Energy recovery d
Slide 29: Engaging all the stakeholders in the value chain on decarbonation
...by engaging all the stakeholders in the value chain, which is key for decarbonising the Group's activities Eramet’s 2022 global CO2 footprint Engaging with our value chain on Scope 3 14.97 MtCO2 Eramet’s commitment 3.55 MtCO2 3.54 MtCO2 of its suppliers and customers by 67% emissions to have deca
Slide 30: Q1 2023 Key trends
5 Q1 2023 Key trends Unless otherwise specified, financial figures are presented in accordance with IFRS 5 - Non-currents Assets Held for Sale and Discontinued Operations -, in line with Eramet’s new scope focused on the Mining & Metals division
Slide 31: Sharp decline in prices in Q1 2023 compared to exceptionally high levels in Q1 2022
Sharp decline in prices in Q1 2023 compared to exceptionnaly high levels in Q1 2022, particularly for manganese alloys and Class II nickel Manganese ore (CIF China 44%) Nickel ore Q = -13% Q = -9% SLN nickel ore (CIF China 1.8%) Weda Bay nickel ore (HPM – Indonesia) Q= +29% Q1 22 Q2 22 Q3 22 Q
Slide 32: Input costs still high, albeit declining in Q1 2023 vs. 2022 average
Input costs still high, albeit declining in Q1 2023 vs. 2022 average 100 basis Reductant prices Q = -36% 250 Q = -32% Reductants 200 150 Q1 2023 prices down (vs. Q1 2022) but still at historically high levels 100 50 Still weighing on the performance of the metallurgical activities 0 Q1 22 Q2 22 Q3 2
Slide 33: Q1 2023 Group adjusted turnover down 24%
Q1 2023 Group adjusted turnover down 24%, mostly driven by a very unfavourable price effect as expected Slight decrease in overall volumes despite strong Weda Bay performance, reflecting: ✓ Exceptionnal operational difficulties in Gabon (production & transport halted over nearly 1 month after end-20
Slide 34: Ba2 / BB+ credit ratings awarded in April
Credit rating awarded in April by two leading agencies, enhances the Group in securing and diversifying its financing plan Ba2 BB+ Stable outlook Outlook stable Reflecting the quality of Eramet’s asset portfolio, refocused on the mining and metallurgical activities Validating the Group's capital all
Slide 35: Successful inaugural issue of €500m sustainability-linked bonds
Successful inaugural issue of €500m sustainability-linked bonds st bond issuance as 1 rated company Sustainability-linked features SPT 1 SLB Financing directly linked to our -35% Scope 1 and 2 GHG emission intensity reduction (vs. 2019 baseline) decarbonation roadmap by 2025 SPT 2 €500m 2028 of supp
Slide 36: Conclusion & outlook
Conclusion & outlook
Slide 37: Robust mining production expected in 2023 in a more challenging environment
Robust mining production expected in 2023, in a more challenging economic and operating environment Geopolitical and macroeconomic uncertainties, as well as inflationary context continue weighing on all the Group's markets in 2023, to a lesser or greater extent depending on markets and geographic ar
Slide 38: The start of a new ERA
The start of a new ERA WELL POSITIONED TO REPOSITIONING IN M&M ADDRESS FAST-GROWING CASH GENERATING MARKETS IN YEARS ACTIVITIES AHEAD 1 2 3 4 ROBUST BALANCE DEVELOPING PROJECTS SHEET & STRONG TO ADDRESS ENERGY FUNDAMENTALS TRANSITION 38 Ordinary Shareholders’ General Meeting – 23 May 2023
Slide 39: Rapport des Commissaires aux Comptes
Rapport des Commissaires aux Comptes 23 mai 2023