Slide 1: Capral Limited (ASX:CAA)
26 February 2020 Capral Limited (ASX:CAA) Level 4, 60 Phillip Street Parramatta NSW 2150 Approved and authorised by Capral’s Board of Directors
Slide 2: 5 plants; 8 extrusion presses
5 plants; 8 extrusion presses 18 distribution centres Australia-wide Annual extrusion capacity 65k tonnes Annual turnover ~$420 million¹ Residential & commercial construction, industrial Employs over 900 people ¹ 12 months to 31 Dec 2019 2
Slide 3: Agenda
1. FY19 Highlights 2. FY19 Financials 3. Strategy and Outlook 4. Questions
Slide 4: FY19 Highlights
“Full year earnings in line with guidance, stronger second half profits and continuation of dividend” 4
Slide 5: Full year result in line with latest guidance
Full year result in line with latest guidance Trading EBITDA¹ of $11.0m (FY18: $14.3m) and EBITDA1 of $19.9m (FY18: $13.1m) 2H19 Trading EBITDA1 of $8.6m due to savings realised from business initiatives Volumes down 6% on prior period with conditions stabilised in second half of 2019 Fina
Slide 6: Channels to market and diverse industry exposure
Channels to market (volume) Diverse industry exposure Volume Seasonality Tonnes (000’s) 40 35 17% 13% 30 VOLUME 25 46% VOLUME BY END 46% BY CHANNEL MARKET 20 37% 41% 15 10 5 Rolled aluminium (via DCs) Industrial 0 Extruded aluminium (via DCs) Residential Building 1H14 2H14 1H15 2H15 1H16 2H16 1H17 2
Slide 7: Annual Dwelling Commencements
Annual Dwelling Commencements1 (‘000) 2019 250 Capral’s volume in the residential market is mainly aligned with Detached and Low Rise Dwellings (shaded green in adjacent graph) Residential commencements have declined significantly through 2019 200 Latest estimate¹ 170,000 starts for 2019 24%
Slide 8: Kunzea House, Springvale, NSW
Kunzea House, Springvale, NSW Hume Splash Swim Centre, Craigieburn, VIC Denmac MHM Prime House Office Tower, WA 8
Slide 9: Total Capral Industrial Volumes
Total Capral Industrial Volumes (Index 2012) New Truck and Van builds¹ (‘000) 120.00 45 100.00 40 80.00 35 60.00 30 25 40.00 20 20.00 15 - 10 2012 2013 2014 2015 2016 2017 2018 2019 Source: Capral 5 F² F² Marine sector strong – commercial ferries and defence 0 2010 2011 2012 2013 2014 2015 2016 20
Slide 10: Commercial Ferry, Bajamar Express
Commercial Ferry, Bajamar Express “Veiled” by Britt Mikkelsen Maxi-Cube trailer built by MaxiTRANS Henderson, WA Sculptures by the Sea, Bondi, NSW Ballarat VIC 10
Slide 11: Capral has an estimated 26% share of the Australian aluminium extrusion market
2019 '000 Tonnes PA Aluminium Extrusion Market Sales Volume Capral has an estimated 26% share of the Australian aluminium extrusion 200 190 market 186 186 179 180 173 173 175 Import volumes and share of market increased in FY18 and maintained high 161 156 levels through FY19. Positive anti-dumpi
Slide 12: FY19 Financials
“Earnings improve in second half, in line with guidance, and above same period last year despite lower sales” 12
Slide 13: Sales Volume and income statement 1H19 2H19
1. FY19 Volume 6% lower than prior year. 2H19 volume 2% lower NOTE 1H19 2H19 FY19 1H18 2H18 FY18 than 2H18 2. Sales revenue reduction driven by lower volume and reduced sales Sales Volume ('000 tonnes) 1 26.8 30.0 56.8 29.9 30.6 60.5 price due to lower LME $m $m $m $m $m $m 3. Margins continue to be
Slide 14: Balance Sheet
BALANCE SHEET NOTE DEC ’19* DEC ’18 $m $m 1. Inventory consists mainly of raw material (billet) and finished goods (rolled Current Assets product and extrusion). $6.1m reduction from FY18 due to lower LME and Inventory 1 78.9 85.0 reduction in billet stock Trade Receivables 2 62.6 65.4 2. Trade rece
Slide 15: Cash Flow
1. Working Capital increase mainly driven by delayed Debtor payments at CASH FLOW NOTE FY19* FY18 Year End $m $m EBITDA 19.9 13.1 2. Right of use lease interest of $4.5m. Operational interest charge in line with FY18 Working Capital 1 (3.4) - Finance Cost & Other 2 (5.6) (1.1) 3. Maintenance capex i
Slide 16: Impact of AASB16 on Income Statement, Balance Sheet, Cash Flow
Income Balance Cash Flow Statement Sheet* Statement Operating EBITDA Assets cash flow $16.7m $59.7m $15.1m Financing EBIT Liabilities cash flow $5.2m $89.1m $15.1m NPAT Net Assets $0.7m $29.3m Depreciation NAV per share $12.9m 6.1c Interest * AASB16 take on balances as at 1 January 2019 $4.5m 16
Slide 17: Strategy and Outlook
“Deliver benefits from restructuring and technology investments to further improve Capral’s long term competitive position" 17
Slide 18: Manufacturing investments and market development
Manufacturing Investments in key capital projects (automation at Bremer Park and new paint line at Canning Vale) were completed in 2019. These projects, as well as the restructuring at Bremer Park, have lowered Capral’s breakeven point. Focus in 2020 to deliver cost savings from projects and streaml
Slide 19: Anti-Dumping Activities and Aluminium Price
Anti-Dumping Activities Aluminium Price 2010 to ► Case won in 2010 with low level duties imposed on Chinese imports A$/kg Metal Cost 2015 ► Reforms to federal legislation and methodology 3.30 3.10 2.90 2.70 2017 ► Measures imposed against all Vietnam and some Malaysian sourced extrusions (1) 2.50 (2
Slide 20: Outlook: working with Government to strengthen anti-dumping measures
LME¹ is forecast to remain at current levels throughout 2020 AUD weakened to ~$US0.67 early in 2020 and forecast to remain close to that level through 2020² Residential commencements are expected to bottom during the first half but recovering in the second half to finish around 158,000 units f
Slide 21: Capral has a national footprint
Capral has a national footprint with a presence in every state and extrusion plants near five mainland capital cities Distribution centres 4 Bremer Park manufacturing plant Queensland 19 1 Cairns AC ► Capacity 30k tonnes ► Darwin ► 4 presses (1 moth balled) ► 2 Townsville RDC / AC ► 1 paint line ► 3
Slide 22: Questions
CAPRAL ALUMINIUM Questions