Slide 1: 2018 Half Year Results Presentation
2018 Half Year Results Presentation
Slide 2: Australia's leading supplier of aluminium products and solutions
Australia's leading supplier of aluminium products and solutions 5 plants; 8 extrusion presses 17 distribution centres Australia-wide Annual extrusion capacity 70k tonnes Annual turnover ~$450 million¹ Residential, commercial construction, industrial Over 1,000 FTEs ¹ 12 months to 31 Dec 2017 2
Slide 3: Agenda
Agenda 1. 1H18 Highlights 2. 1H18 Financials 3. Strategy and Outlook 4. Questions 3
Slide 4: 1H18 Highlights
1H18 Highlights Tony Dragicevich, CEO & MD “First half delivered earnings in line with prior period” 4
Slide 5: 1H18 Performance Highlights
1H18 Performance Highlights Half year result in line with prior period Trading EBITDA¹ of $6.9m (1H17: $6.6m) and EBITDA of $7.6m (1H17: $7.7m) Volumes in line with 1H17 Strong balance sheet and net cash of $28.9m Special dividend declared at 0.5 cents (fully franked) Margins impacted by
Slide 6: Volume Breakdown
Volume Breakdown Channels to market (volume) Diverse industry exposure Volume Seasonality Tonnes (000’s) 40 35 30 25 20 15 10 5 0 1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 Source: Capral * Residential building includes additions and alterations RDC: Capral Regional Distribution Centre ** Industri
Slide 7: Conditions softening in Residential market
Conditions softening in Residential market Annual Dwelling Commencements¹ (‘000) 250 Residential commencements 2018 forecast in line with 2017 but declining through 2019 200 Pipeline in residential work is reducing Multi-Res High Rise is showing the sharpest 150 decline Victoria, New South W
Slide 8: Where Capral's Residential & Commercial products ended up
Where Capral’s Residential & Commercial products ended up RACV Cape Schanck Resort - VIC ABC Offices – Southbank VIC Glen Iris House – South East VIC 8
Slide 9: Industrial sector robust
Industrial sector robust Total Capral Industrial Volumes (Index 2012) New Truck and Van builds¹ (‘000) 120 40 35 100 30 80 25 60 20 15 40 10 20 5 0 0 2012 2013 2014 2015 2016 2017 2018 2010 2011 2012 2013 2014 2015 2016 2017 2018 F² Source: Capral ¹ Source: TIC (Truck Industry Council of Australia)
Slide 10: Where Capral's Industrial products ended up
Where Capral’s Industrial products ended up Truck Trailer by Sloanebuilt - NSW Sculpture by Unique Metalworks - WA Cape Class Patrol Vessel by Austal - WA 10
Slide 11: Extrusion market beginning to slow
Extrusion market beginning to slow '000 Tonnes PA Aluminium Extrusion Market Sales Volume Residential construction slowing particularly 200 in High Rise 179 186 184 180 173 Non-residential building remains strong 160 156 161 Key industrial sectors relatively strong 140 120 Capral has an esti
Slide 12: 1H18 Financials
1H18 Financials Tertius Campbell, CFO “Cash flow generation continues to improve, enabling the business to invest in operational improvement projects and return cash to shareholders" 12
Slide 13: Trading EBITDA up slightly on prior period
Trading EBITDA up slightly on prior period 1H18 1H17 1H18 total volume in line with 1H17 Sales Volume ('000 tonnes) 29.9 29.6 $m $m Sales revenue up driven by higher metal prices Sales Revenue 222.6 207.6 Trading EBITDA¹ 6.9 6.6 Margins continue to be under pressure due to imports and excess l
Slide 14: Margins impacted by rising LME
Margins impacted by rising LME Metal Cost LME (USD) continued its rise in 1H18, increasing ~18% A$/kg in 1H18 vs 1H17 3.50 3.00 Announcement by Trump administration of trade sanctions caused LME to rise 35% in April 2018 to a 7 2.50 year high of $US2,718t 2.00 1.50 Easing concerns saw LME fall
Slide 15: Financial position supports dividends and re-investment
Financial position supports dividends and re-investment 1H18 1H17 Jun 18 Jun 17 $m $m $m $m Current Assets EBITDA 7.6 7.7 Inventory 87.6 76.0 Working Capital (1.7) (7.8) - On hand 75.0 69.8 - In Transit 12.6 6.2 Finance Cost (0.4) (0.4) Trade Receivables 73.5 73.2 Other - 0.5 Net Cash and Equivalent
Slide 16: Strategy and Outlook
Strategy and Outlook Tony Dragicevich, CEO & MD “Invest in technology to ensure Capral’s long term competitive position" 16
Slide 17: Investments to improve productivity and competitiveness
Investments to improve productivity and competitiveness Automated product handling and packing at Bremer New paint line at Canning Vale, WA ($2.4m) Park, QLD ($4.5m) Building complete Stage 1 installation and commission completed Equipment on-site, installation Q3 2018 Stage 2 installati
Slide 18: Dumped imports suppress prices and injure local industry
Dumped imports suppress prices and injure local industry 2010 – Modest impact from initial measures on Chinese imports Case won in 2010 with 2014 – Anti-Circumvention low level duties imposed on Chinese imports Anti-Circumvention case 2015 – Measures increased Circumvention initiated and succe
Slide 19: Outlook
Outlook Commentators are forecasting a gradual fall in LME¹ from current levels during 2H18 AUD weakening to ~$US0.70 by year end and remaining at that level through 2019² Residential commencements are expected to soften³ Industrial sector anticipated to remain strong Extrusion market expe
Slide 20: National footprint of aluminium extrusion plants and distribution centres
National footprint of aluminium extrusion plants and distribution centres Extrusion Extrusion plants plants Distribution Distribution centres centres QLD - Bremer Capacity 35k tonnes, 4 presses 2 paint lines and anodising line 2018: Automated product handling project WA - Canning Vale Capaci
Slide 21: CAPRAL
CAPRAL ALUMINIUM SHAPING THE FUTURE