Apl Apollo Tubes Limited · NSE:APLAPOLLO
Apl Apollo Tubes — Q2 FY23 Earnings Presentation
44 slides from Apl Apollo Tubes's earnings presentation, October 2022
Slide 1: Q2FY23 Results
(aPLaPouo YOU THING WE SUP CELEBRATING NETWORK OF 800 DISTRI Q2FY23 Results al i i
Slide 2: Safe Harbour
Safe Harbour Except for the historical information contained herein, statements in this presentation and the subsequent discussions, which include words or phrases such as "will", "aim", "will likely result", "would", "believe", "may", "expect", "will continue", "anticipate", "estimate", "intend", "
Slide 3: Contents
Contents • Q2FY23 at glance • Financial Performance • Business Strategy • New Initiatives APL APOLLO TUBES • ESG Engagement • Team APL Apollo
Slide 4: Q2FY23 at a Glance
Q2FY23 at a Glance 602k ton ₹ 39.7 Bn ₹2.3 Bn ₹ 3,850 Sales Volume Revenue EBITDA EBITDA/ton 41% yoy increase 29% yoy increase 4% yoy increase 26% yoy decline ₹136 Mn* ₹ 1.5 Bn 54% ₹ 4.3 Bn Interest Cost Net profit Value Added H1FY23 OpCF 27% yoy increase 3% yoy increase Sales mix FY22 was Rs 6.5 Bn
Slide 5: Financial Performance
FINANCIAL PERFORMANCE APL APOLLO TUBES
Slide 6: De-commoditizing Product Portfolio
De-commoditizing Product Portfolio Value added products contributed 54% of total sales in Q2 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 Product Sales EBITDA Sales EBITDA Sales EBITDA/ Sales EBITDA/ Sales EBITDA Application Volume Volume Volume Volume Volume Category Mix /Ton Mix /Ton Mix Ton Mix Ton Mix /To
Slide 7: EBITDA Bridge (Per Ton)
EBITDA Bridge (Per Ton) - 300 - 100 - 337 4,587 3,850 APL APOLLO TUBES EBITDA/ton as on 30-Jun-22 Sales Mix New Raipur Aggressive sales push EBITDA/ton as on 30-Sep-22 Sales mix deteriorated due Raipur (ABPL) currently Discounts offered to to higher proportion of breaking even as plant is clients be
Slide 8: De-commoditizing Product Portfolio
De-commoditizing Product Portfolio Value added products contributed 63% of total sales in FY22 vs 42% in FY18 FY19 FY20 FY21 FY22 1HFY23 Annual Product Sales EBITDA Sales EBITDA Sales EBITDA/ Sales EBITDA/ Sales EBITDA/ Application Volume Volume Volume Volume Volume Capacity Category Mix Gradually i
Slide 9: Post Tricoat Merger Reporting Structure
Post Tricoat Merger Reporting Structure Q1FY23 Q2FY23 Product Category Application Sales Mix Volume EBITDA/Ton Sales Mix Volume EBITDA/Ton (%) (KTon) (Rs) (%) (KTon) (Rs) Heavy Structures 8 33 7,028 7 41 6,926 Apollo Structural Light Structures 14 59 5,081 18 109 5,344 General Products 39 165 1,614
Slide 10: Global Peer Benchmarking
Global Peer Benchmarking 19% 85 131 17% 14% APL Apollo 185 106 7% SSAB 68 Maruichi Zekelman SSAB Maruichi Zekelman APL Apollo Revenue (Rs Bn) EBIDTA Margin (%) 2.8 2.6 APL APOLLO TUBES 1.4 1.1 60% 60% 80% 97% SSAB Maruichi Zekelman APL Apollo SSAB Maruichi Zekelman APL Apollo Manufacturing Capacity
Slide 11: Growing Strength to Strength
Growing Strength to Strength EBITDA (Rsm) Volume (k'ton) 2,661 602 2,319 552 2,222 2,023 1,939 427 423 403 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 EBITDA/Ton (Rs) Net Profit (Rsm) 1,630 APL APOLLO TUBES 5,199 5,023 1,502 4,823 4,587 1,313 3,850 1,156 1,071 Q2FY22 Q3FY22
Slide 12: Growing Strength to Strength
Growing Strength to Strength Operating Cash Flow (Rs Bn) Net Debt/EBITDA (x) 2.1 2.1 1.7 9.8 6.5 5.1 4.3 3.6 0.2 0.2 0.3 0.9 FY18 FY19 FY20 FY21 FY22 H1FY23 FY18 FY19 FY20 FY21 FY22 H1FY23 Net Debt/ Equity (x) Net Debt (Rs Bn) APL APOLLO TUBES 0.9 0.9 8.1 7.7 7.9 0.6 2.9 2.0 1.6 0.1 0.1 0.1 FY18 FY1
Slide 13: Growing Strength to Strength
Growing Strength to Strength ROE (%) ROCE (%) 34.6 28.8 24.8 27.3 22.6 26.5 20.5 21.2 20.8 16.5 18.4 18.4 FY18 FY19 FY20 FY21 FY22 H1FY23 FY18 FY19 FY20 FY21 FY22 H1FY23 Interest Coverage Ratio (x) Net Working Capital Days APL APOLLO TUBES 19.7 18.4 48 34 29 9.3 4.0 3.8 3.0 9 7 5 FY18 FY19 FY20 FY21
Slide 14: Growing Strength to Strength
Growing Strength to Strength 184 Operating Cashflow to EBITDA (%) Capex to Op. Cash flow (%) 144 107 102 91 90 91 69 63 59 25 29 FY18 FY19 FY20 FY21 FY22 H1FY23 FY18 FY19 FY20 FY21 FY22 H1FY23 FCF (Rs Bn) Du-Pont ROE (%) APL APOLLO TUBES 5 30 4 25 3 6.1 20 2 15 1 0 10 -1.5 -0.1 -0.4 -0.6 -0.1 FY18 F
Slide 15: Profit & Loss Statement (Consol)
Profit & Loss Statement (Consol) Particulars (Rsm) Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 FY22 FY21 Sales Volume (k Ton) 427 403 552 423 602 1,755 1,640 Net Revenue 30,839 32,304 42,147 34,386 39,692 1,30,633 84,998 Raw Material Costs 26,534 28,097 36,829 29,915 34,747 1,12,231 71,648 Employee Costs 373
Slide 16: Balance Sheet & Cash flow (Consol)
Balance Sheet & Cash flow(Consol) Balance Sheet - Assets (Rs mn) H1FY23 FY22 Cashflow Statement (Rs mn) H1FY23 FY22 Cash & Bank Balance 6,570 3,764 EBITDA 4,258 9,452 Receivables 1,049 3,417 Accounts receivables 2,385 -2,108 Inventories 10,933 8,472 Inventory -2,468 -887 Other current assets 1,816 2
Slide 17: Consol. Cash Flow Bridge
Consol. Cash Flow Bridge (Rs mn) -1,061 -253 -2,041 -2,947 Net Debt 31-Mar-22 Op. cash flow Capex Investments Dividend & Others Net Debt 30-Sep-22 4,343 -3,935 APL APOLLO TUBES Business continues to Capex being funded from Net debt to EBITDA at 0.3x generate strong internal cash flows operational ca
Slide 18: Business Strategy
Capex Plan for Distribution Capex Plan for Distribution value addition Enhancement value addition Enhancement BUSINESS STRATEGY APL APOLLO TUBES Market Market Creation Creation Innovation Innovation
Slide 19: APL Apollo Vision
APL Apollo Vision MARKET CREATION INNOVATION ESG • Solid new product + • Replacement of conventional + • Introducing environmentally construction products friendly products pipeline • Wood • To reduce the emissions by • Complete product • Angles/Channels 25% by 2030 • RCC • Working Towards gender po
Slide 20: Innovation
INNOVATION Mission: World’s only company to make steel tubes with size range of 10x10mm to 1000x1000mm and thickness range of APL APOLLO TUBES 0.23 mm to 40mm 20
Slide 21: What we have done so far as the first company: Indian Markets
What we have done so far as the first company Indian Markets Structural steel square and Structural application in rectangular tubes: construction Industry Pre-galvanized structural Corrosive resistant structural steel tubes (Apollo Z): applications DFT (Direct Forming Faster TAT with tailor made AP
Slide 22: What we have done so far as the first company: Global Markets
What we have done so far as the first company Global Markets Chaukhat (Door frame Replacing Conventional shape tubes) wooden door frames Rectangular section of 1:11 Replacing Conventional (Length to Breadth) wooden sections APL APOLLO TUBES 22
Slide 23: Registered Patents
16 Registered Patents Double Door Chaukhat Tube Apollo Signature Four Double Door Chaukhat Tube Single Door Chaukhat Tube Elliptical Tube for electric transformers D Section for Handrail/Fence Handrail Tube Window Frame Tube (L) APL APOLLO TUBES Window Frame Tube (T) Window Frame Tube (Z) Reflector
Slide 24: New Product Pipeline from Raipur plant
New Product Pipeline from Raipur plant World’s 1st thicker color Superior corrosion resistant, high coated products load bearing with aesthetics World’s 1st Color coated Superior corrosion resistant with structural steel tubes aesthetics India’s 1st 500x500mm dia structural steel tubes Replacing RCC
Slide 25: Market Creation
MARKET CREATION APL APOLLO TUBES 25
Slide 26: Structural Steel Tube Applications
Structural Steel Tube Applications Application Mix Commercial Buildings 25% Housing 50% APL APOLLO TUBES Infrastructure 20% Others 5% 26
Slide 27: How Have We Created Market..
How Have We Created Market.. Conventional Construction Why Structural Steel Tube replaces How to replace the conventional Applications Products these products? products?? Structural support, Towers Uniform Strength, Steel Angle/Channels infrastructure Lower steel consumption Low Diameter Cost Effect
Slide 28: Revolutionizing Construction Industry
REVOLUTIONIZING CONSTRUCTION INDUSTRY APL APOLLO TUBES 28
Slide 29: Tubular Construction Process flow
Tubular Construction Process flow Tube Manufacturing Fabrication Civil Foundation Hospital Building Production of 6,000 ton ERW Tubes are sand blasted, Civil Foundation & Arrangement Hospital tubes per day at plants of APL then connected using of anchor bolts at site to install Apollo connectors tub
Slide 30: Delhi Hospitals - Proof of Concept
Delhi Hospitals- Proof of Concept Geeta Colony Sultanpuri Shalimar Bagh Fabrication & Erection Fabrication & Erection Fabrication & Erection 1,000 ton 600 ton 3,300 ton APL APOLLO TUBES Revolution in Construction GTB Hospital Sarita Vihar Fabrication & Erection Fabrication & Erection 1,800 ton 900 t
Slide 31: Applications
Applications ● High Rise Buildings ○ Hospitals, Housing, Schools, Courts, Hotels/Malls/Offices 45 42mn sq. ft. 220,000 ton heavy structural steel ● Warehouses/Cold Storage/Food Parks projects Visibility tubes ● Factory Buildings/Process Structures ● Aviation Hangers Ongoing enquiries ● Data Centres
Slide 32: Our Biggest Ever (New Raipur Plant)
OUR BIGGEST EVER APL APOLLO TUBES (NEW RAIPUR PANT) 32
Slide 33: Raipur Plant Update
Raipur Plant Update HIGHLIGHTS • Upcoming 400 Acre Raipur plant progressing on expected lines • Project to commence in phases starting H2FY23 • 100% value added products APL APOLLO TUBES • Total capex Rs8-10bn; c80% already incurred 33
Slide 34: Raipur Plant Update
Raipur Plant Update APL APOLLO TUBES Area of 1.5mn square feet being built using 100% Apollo Column Tubes 34
Slide 35: New Initiatives
APL APOLLO TUBES NEW INITIATIVES
Slide 36: B2C Tech App
B2C Tech App APL APOLLO MOBILE - APPLICATION LAUNCHED 26,000+ Fabricators enrolled APL APOLLO TUBES 90,000+ Total Downloads 300+ Designs 16 Patents registered
Slide 37: APL Apollo's ESG Transformation Journey
APL APOLLO’S ESG TRANSFORMATION JOURNEY 37
Slide 38: Commitment and achievements
Commitment and achievements Commitments Achievements Committed to reducing Scope 1&2 emissions by 25% by 2030 E Introduced new, environmentally friendly products E Committed to set near term and Net Zero targets by 2050 All plants have access to green energy, 2 plants have more E than 85% de
Slide 39: ESG Developments
ESG Developments Assessed Scope 3 emissions (in addition to Scope 1 & Scope 2) 1) Safety Manual formulated for all the production facilities and offices 2) New Human Rights policy incorporated APL APOLLO TUBES Code of Conduct: New Code of conduct is formulated for all employees 39
Slide 40: Front runner for Steel for Green
Front runner for Steel for Green APL Apollo is the 1st Company to innovate readymade Chaukhat, Fence, Plank and Hand rails as Steel for Green Concept which replaced conventional wood application in building construction Our Products are saving 250,000 trees every year, going ahead we will be sav
Slide 41: Steel Buildings = Decarbonization
Steel Buildings = Decarbonization ● Construction sector contributes 30% of direct and indirect Co2 emissions Steel Structure - RCC Structure ● Structural steel is preferred for steel buildings because steel is ○ Infinitely recyclable ○ Easy to pre-fabricate ○ High volume to weight ratio APL Apollo T
Slide 42: Financial Priorities under Strong Governance
Financial Priorities under Strong Governance Growth Earnings Drive sustainable EPS growth Profitable Organic Growth Attain earnings objectives across Commitment to R&D and Talent economic cycles Innovate products to replace conventional construction methods APL APOLLO TUBES Capital Allocation Drive
Slide 43: Team APL Apollo
Team APL Apollo DIRECTORS DIRECTORS (NON (NON EXECUTIVE) EXECUTIVE) Neeru Abrol Abhilash Lal Anil Kumar Bansal Virendra Singh Jain Director at TCNS Clothing Co 3 decades of professional Director of NABARD, Rockland Board member of Dalmia Bharat Limited & others|Awarded best experience in senior role
Slide 44: Thank You
Thank You For further information, please contact: APL Apollo new Corporate office (Work in progress) Deepak Goyal APL Apollo Tubes Ltd Tel: +91 120 404 1400 APL APOLLO TUBES Email: deepakgoyal@aplapollo.com Anubhav Gupta APL Apollo Tubes Ltd Tel: +91 120 404 1452 Email: anubhav@aplapollo.com APL Ap