Acerinox Sa · BME:ACX
Acerinox Sa — Q1 2020 Earnings Presentation
18 slides from Acerinox Sa's earnings presentation, Apr 24, 2020
Slide 1: Acerinox Q1 2020 Results Presentation
ACERINOX Q1 2020 RESULTS PRESENTATION 24 APRIL 2020 ACERINOX Q1 2020 RESULTS PRESENTATION
Slide 2: Disclaimer
Disclaimer This document may contain forward-looking information and statements about ACERINOX, S.A., its subsidiaries and/or its management. These forward-looking statements include financial projections and estimates and their underlying assumptions, and statements regarding the intent, belief or
Slide 3: Improvement quarter on quarter
Improvement quarter on quarter Q1 MARKET HIGHLIGHTS Q1 ACERINOX HIGHLIGHTS • Improvement in market activity over Q4 2019 • Acquisition of VDM Metals • Reduction of raw material prices • Strong balance sheet to face the current situation • COVID-19 already impacting in Q1 • Excellent liquidity positi
Slide 4: Q1 Main Financial Figures
Q1 Main Financial Figures Million EUR Variation Q1 Variation Q1 Q1 2019 Q1 2020 2020/2019 Q4 2019 2020/Q4 2019 Net Sales 1,202 1,159 -4% 1,093 6% EBITDA 90 85 -6% 74 15% Results before Taxes and Minorities 45 41 -9% -135 --- Results after Taxes and Minorities 33 28 -14% -173 --- Free Cash Flow (befo
Slide 5: Good quarterly figures in a pre crisis environment
Good quarterly figures in a pre crisis environment MELTING PRODUCTION EBITDA NET FINANCIAL DEBT 854 10 VDM 313 VDM Thousand Mtons Million EUR Million EUR 628 570 599 97 103 542 90 85 491 74 552 573 642 582 495 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q4 Q1 Q2 Q3 Q4 Q1 2019 2020 2018 2019 2020 541 Net debt incr
Slide 6: Managing the challenges of 2020 with COVID-19
Managing the challenges of 2020 with COVID-19 6 ACERINOX Q1 2020 RESULTS PRESENTATION
Slide 7: Overview of current situation
Overview of current situation Market Acerinox • Globally PMIs are collapsing and economic data continues to deteriorate • Acerinox Europa, Roldán and Inoxfil are working • Many industries are totally shut down under with low levels of capacity utilization Government instructions • NAS keeps on opera
Slide 8: How Acerinox is facing this crisis
How Acerinox is facing this crisis 1. Liquidity is key 2. Balance sheet already in a good shape 3. Lessons learnt from 2008 4. Our long term strategy remains intact 8 ACERINOX Q1 2020 RESULTS PRESENTATION
Slide 9: Liquidity is key
Liquidity is key Million EUR Massive liquidity covering maturities until 2025 Available lines 332 In March, five term loans were contracted 350 Million EUR No covenants Maturity: 4.6 years Average cost: 0.9% Cash on 1,125 hands 446 191 197 273 194 120 43 38 28 4 Liquidity 2020 2021 2022 2023 2024 20
Slide 10: Balance sheet already in a good shape
Balance sheet already in a good shape Million EUR Group's financial strength ensures that current environment should not impact Acerinox liquidity The total gross debt, 1,980 million euros, is free of covenants on results The weighted average cost of term debt is 1.4% 102 10 ACERINOX Q1 2020 RESULTS
Slide 11: Even post VDM acquisition balance sheet metrics remain very strong
Even post VDM acquisition Balance Sheet metrics remain very strong DEBT / EQUITY DEBT / EBITDA EBIT / INTEREST EXPENSE 1.76 14.25 44% 12.73 1.25 1.23 10.59 31% 1.15 26% 26% 5.44 Times Times 2017 2018 2019 March 20 2017 2018 2019 LTM Mar 2017 2018 2019 Mar 20 20 11 ACERINOX Q1 2020 RESULTS PRESENTATI
Slide 12: Lessons learnt from 2008
Lessons learnt from 2008 Reducing fixed costs: • Negotiating temporary lay offs in Spain • Applying flexibility within US labour legislation • Adapting maintenance relative to production levels • Reducing the cost of subcontractors based on activity levels Capital allocation will be focused on liqui
Slide 13: Our long term strategy remains intact
Our long term strategy remains intact • Intense balance sheet focus that allow us an efficient capital allocation • Constantly improving due to digitalization and 360º planning, cost reduction programs and optimizing the commercial network • Added value enhanced by VDM metals and constant Excellence
Slide 14: Added value enhanced by VDM Metals
Added value enhanced by VDM metals Why does VDM Metals add value? ▪ Globally #1 in specialty alloys market Market leader with ▪ Reputation of excellence and strong brand name growth Potential ▪ Significant growth potential in specialty alloys Technology innovation ▪ Innovation leader with excellent
Slide 15: VDM integration process
VDM integration process On March 17 Acerinox closed the purchase of VDM Metals Transition process launched to ensure business continuity and prioritize the long-term vision The current work plan is divided into 18 areas and includes a specific integration team In 100 days, the operational and synerg
Slide 16: VDM integration: consolidation from March 2020
VDM integration: consolidation from March 2020 Million EUR Acerinox Q1 VDM March ACX+VDM Proforma Q1 / 2020 2020 Proforma Q1 Acerinox Q1 2019 Net turnover 1,159 71 1,229 2% EBITDA 85 10 94 5% D&A (40) (2) (42) -5% EBIT 44 8 52 15% Financial expenses (3) (3) (6) 6934% Results before taxes 41 4 46 1%
Slide 17: Outlook and conclusions
Outlook and conclusions • 2020 will be incredibly challenging • The duration of any downturn is currently impossible to predict • Acerinox is in a very strong shape now to weather any storm: • Strong liquidity position • Balance sheet remains robust • We have numerous levers to pull to protect the b
Slide 18: Value creation for all stakeholders
VALUE CREATION FOR ALL STAKEHOLDERS ACERINOX Q1 2020 RESULTS PRESENTATION