Usinas Siderurgicas De Minas Gerais Sa-usiminas · BMFBOVESPA:USIM3
Usinas Siderurgicas De Minas Gerais Sa-usiminas — Usinas Siderúrgicas de Minas Gerais — Q2 2024 Earnings Presentation
49 slides from Usinas Siderurgicas De Minas Gerais Sa-usiminas's earnings presentation, Jul 26, 2024
Slide 1: Results 2Q24 Webcast and Institutional Presentation
1Q24 Results Results 2Q24 Webcast Institutional Presentation April 23, 2024 1 Classificação da informação: Uso Interno
Slide 2: Summary
1Q24 Results SUMMARY WEBCAST....................................................03 INSTITUTIONAL PRESENTATION...............12 April 23, 2024 2 Classificação da informação: Uso Interno
Slide 3: Results Presentation 2Q24
2Q24 Results Results Presentation 2Q24 Classificação da informação: Uso Interno July 26, 2024 3
Slide 4: Highlights of the quarter
2Q24 Results Highlights of the quarter Iron Ore Sales Steel Sales Steel Sales Domestic Market compared to 1Q24 2miton 1miton +6% Adjusted EBITDA Adjusted Ebitda Crude Steel Production Margin Referring to 1Q24 R$ 247mi 4% +17% Investment Cash Leverage (CAPEX) R$ 231mi R$ 5.6bi 0.79x July 26, 2024 4 C
Slide 5: Consolidated net revenue, adjusted EBITDA, net income
2Q24 Results Consolidated NET REVENUE ADJUSTED EBITDA NET INCOME R$ Million R$ Million R$ Million 9% 7% 5% 6,887 975 6,714 6,781 6,223 6,350 0% 4% 625 366 416 287 247 36 (20) (100) 2Q23 3Q23 4Q23 1Q24 2Q24 (166) 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 5
Slide 6: Steel Unit
2Q24 Results Steel Unit STEEL SALES NET REVENUE ADJUSTED EBITDA (Kt) R$ Million and per ton (R$/t) R$ Million Domestic: ∆1Q24: +6% 6,442 ∆1Q24: -1% 5% 6% 5,906 4% 5,658 5,577 5,498 1,014 1,041 1,037 1,042 1% 944 68 90 121 117 Exports 70 -3% ∆1Q24: -79% 6,082 5,988 5,890 5,784 5,728 334 497 491 734 6
Slide 7: Steel Unit quarterly variation in EBITDA
2Q24 Results Steel Unit QUARTERLY VARIATION IN EBITDA R$ Million Reduction in EBITDA mainly due to price/mix, price and exchange rate effects on CPV, and non-recurring expenses. 26 de Junho de 2024 → 7
Slide 8: Mining Unit
2Q24 Results Mining Unit IRON ORE SALES NET REVENUE ADJUSTED EBITDA (kt) R$ Million and per ton (US$/t) R$ Million and per ton (US$/t) ∆1Q24: +31% 31% $101 16% 16% 13% 20% 2,383 ∆1Q24: +3% $88 2,398 2,391 $82 $77 1,962 2,015 $67 ∆1Q24: +75% $28 1,895 1,753 1,730 1,255 1,298 Exports $15 $12 $11 1,049
Slide 9: Financial Indicators 2Q24
2Q24 Results Financial Indicators 2Q24 Classificação da informação: Uso Interno July 26, 2024 9
Slide 10: Consolidated cash from operations, capex, free cash flow
2Q24 Results Consolidated CHANGES IN WORKING CAPITAL AND CAPEX FREE CASH FLOW** CASH FROM OPERATIONS* R$ Million R$ Million R$ Million 1,647 1,544 886 879 761 61 121 654 1,005 910 436 131 379 674 271 401 291 268 150 381 231 23 382 386 36 152 232 245 196 - (31) 2Q23 3Q23 4Q23 1Q24 2Q24 (108) (205) 2Q
Slide 11: Consolidated cash, debt and leverage
2Q24 Results Consolidated CASH, GROSS DEBT, NET DEBT AND LEVERAGE GROSS DEBT AMORTIZATION PROFILE - PRINCIPAL ONLY R$ Billion R$ Billion 5.6 0.38x 0.21x -0.05x 0.22x 0.79x Debt Duration: R$: 45 months 1.7 US$: 23 months 5.9 6.1 5.9 6.1 6.6 1.0 1.0 4.1 0.4 (0.1) 0.3 3.9 4.9 5.7 6.0 5.7 5.6 0.7 0,7 0.
Slide 12: 2Q24 Institutional Presentation
2Q24 Institutional Presentation Classificação da informação: Uso Interno
Slide 13: Our Agenda
OUR AGENDA 1 The Usiminas 2 Usiminas Management Pillars People Customers Results 3 Governance and Highlights 4 Appendix Classificação da informação: Uso Interno
Slide 14: The Usiminas Overview
The Usiminas Overview Título ✓ One of the biggest producers of flat steel in Brazil. ✓ Present in six states, covering the entire steel chain ✓ Mining and logistics, capital goods, service and distribution centers and customized solutions. ✓ Two steel mills strategically located along Brazil's main
Slide 15: The Usiminas Financial Highlights and Geographic Location
The Usiminas Financial Highlights Geographic Location 2017 2018 2019 2020 2021 2022 2023 Net Revenue (R$ mi) 10,734 13,737 14,949 16,088 33,737 32,471 27,638 annual growth 27% 28% 9% 8% 110% -4% -15% Ajusted EBITDA (R$ mi) 2,186 2,693 1,973 3,194 12,830 4,905 1,753 Margin 20% 20% 13% 24% 38% 15% -64
Slide 16: Complete Solutions in Products and Services
Complete Solutions in Products and Services Mining Steel Unit Ipatinga | Cubatão | Unigal | Mineração Usiminas Soluções Usiminas o Soluções Usiminas was incorporated into the Steel unit as of 4Q23. Created in 2009, it has a broad portfolio of products and services for the transformation and distribu
Slide 17: Mining Overview
Mining Soluções Overview completas em produtos e serviços ✓ JV formed in 2010 through a partnership with Sumitomo Corporation (30% economic stake) responsible for mining and railway operations. ✓ Three mining sites in the Serra Azul region (MG), with resources of 2.4 billion tons of iron ore. ✓ Asse
Slide 18: Mining Financial Highlights
Mining Destaques Financeiros Iron Ore Sales and Price PLATTS (62% FE CFR China) Mining Business Unit - Thousand tons – Prices in US$/ton 160 109 120 120 93 111 114 128 124 112 8,616 8,683 9,023 8,641 9,055 2,383 2,398 2,391 1,962 2,015 4,631 5,916 6,785 5,822 6,617 1,895 1,753 1,730 1,255 1,298 1,80
Slide 19: Mining Dry Stacking
Mining Dry Stacking ✓ Disposal of tailings by the dry stacking process, replacing dams ✓ Started operation in December 2021 ✓ R$235 million invested Reclaimed water Filtration plant Waste Waste + Dry Stack Flotation Water Tailings Classificação da informação: Uso Interno
Slide 20: Steel and Mineração Overview
Steel Mineração Overview ✓ One of the largest producers of flat rolled steel in Brazil. Projetos Friáveis ✓ Two industrial plants in Ipatinga (MG) and Cubatão ✓ Operações iniciadas em 2014 (SP). ✓ Aumento de capacidade de 8 milhões para 12 milhões de ton/ano de minério de ferro ✓ Nominal crude steel
Slide 21: Steel Sales Evolution and EBITDA
Steel Steel Sales Evolution (Thousand tons) 4,823 1,014 1,041 1,037 1,042 944 4,105 529 4,209 90 121 117 68 4,027 70 3,723 424 609 382 421 924 920 920 974 874 4,294 3,681 3,601 3,646 3,302 2Q23 3Q23 4Q23 1Q24 2Q24 2019 2020 2021 2022 2023 Domestic Market Exports EBITDA (R$ mm) and EBITDA Margin (%)
Slide 22: Steel Products and End Markets
Steel Chapas Grossas Laminados a Quente Laminados a Frio Galvanizados Civil Civil Construction Civil Construction Construction Machinary Civil and Machinary Construction Equipment and White Line Equipment Pipelines White Line Pipelines Auto Capital Industry Goods Auto Wind Energy Industry Auto Solar
Slide 23: Flat steel consumption markets and capacity
Steel Flat steel consumption markets The total crude steel generation capacity is 5 million tons and is located in Ipatinga. Current capacity for generating finished products, considering the galvanizing lines (EG and HDG) and heavy plates at their maximum capacities. Galvanized Heavy Plates Hot Rol
Slide 24: Strategic investments in the Ipatinga plant: Steelworks
Strategic investments in the Ipatinga plant Steelworks 2 • R$535 million in investments by 2023 • Replacement and repair of main metal structures • Recovery of main foundations and scale channels • Recovery and modernization of slab cutting machines Expected benefits Costs reduction Higher productiv
Slide 25: Strategic investments in the Ipatinga plant: Blast Furnace
Strategic investments in the Ipatinga plant Blast Furnace 3 • R$2.7 billion in investments • Ramp-up finished, equipment stable Expected benefits Compared to the pre-revamp period Fuel efficiency gains: 9% GHG reduction with the incorporation of Productivity gains > 30% Gains in specific coke consum
Slide 26: Research and Development
Steel Siderurgia Research and Development Largest steel research center in Latin America ✓ More than 50 years of experience ✓ 17 laboratories ✓ Largest number of steel patents in Latin America (101 letters patent) ✓ Focus on developing new steels and improving production processes Classificação da i
Slide 27: Our Agenda
OUR AGENDA 1 The Usiminas 2 Usiminas Management Pillars People Customers Results 3 Governance and Highlights 4 Appendix Classificação da informação: Uso Interno
Slide 28: People: Social and Environmental Highlights
People Social and Environmental Highlights Highlights Program for the Recovery and The quadrivalent vaccine 216,000 hours of Márcio Cunha Hospital VOU – Usiminas Volunteers Preservation of Green Areas available free of charge for training in safety recognized by Newsweek + More than 14,000 people be
Slide 29: People: Fauna Conservation Monitoring Program
People Fauna Conservation Monitoring Program Visa identificar a presença de espécies ameaçadas de extinção, propor adoção, e analisar habitats 4 Since 200 Seedlings Species 2021 donated to identified as Monitoring municipalities endangered and Conserving Fauna Classificação da informação: Uso Intern
Slide 30: People: Mobiliza Caminhos do Vale Project
People “Mobiliza Caminhos do Vale” Project Socio-environmental projects as counterpart in Marliéria Socio-environmental considerations in Paraíso and Iapú Increase in tourism and handicraft, and helping Construction of the free flight ramp in the community of the local products flow Achado, 2nd larg
Slide 31: People: Education and Culture
People Education and Culture São Francisco Xavier School Usiminas Institute First educational institution in Brazil to obtain Usiminas invested over R$260 million, encouraging around 2,000 ISO 9001 social projects since 1993 Projects and Programs Xerimbabo Usiminas Project “Plante uma vida” Project
Slide 32: People: Social and Environmental Highlights
People Social and Environmental Highlights São Francisco Xavier Foundation Márcio Cunha Hospital – Unit I Márcio Cunha Hospital – Unit II Reference center in the area of health in Brazil Internação, Atendimento Ambulatorial, Centro de Diagnóstico por Imagem e Usifamília Carlos Chagas Municipal Hospi
Slide 33: Results (quarterly)
Results (R$ Million, except otherwise indicated) Net Revenues Ajusted EBITDA and adjusted EBITDA margin 5% 9% 7% 0% 4% 625 416 366 6,887 6,714 6,781 6,350 247 6,223 (20) 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 Capex Net income 879 886 975 61 121 654 287 436 379 131 36 291 268 231 (166) (10
Slide 34: Results (annual)
Results (R$ Million, except otherwise indicated) Net Revenues Ajusted EBITDA and Ajusted EBITDA Margin 38.0% 19.9% 13.2% 15.1% 33,737 32,471 6.3% 27,638 12,830 14,949 16,088 4,905 1,973 3,194 1,754 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 Capex Net Income and Net Margin 3,000 346 2,184 364
Slide 35: Results: Working Capital
Results Financial Results Working Capital (R$ million) 9,444 7,900 6,895 7,003 6,851 2Q23 3Q23 4Q23 1Q24 2Q24 Classificação da informação: Uso Interno
Slide 36: Liquidity and Indebtedness
Liquidity and Indebtedness (R$ billion) Debt Repayment Schedule Cash Position and Indebtedness Current cash position covers all debt until 2028 5.6 Debt Duration: R$: 45 months US$: 23 months 5.9 6.1 5.9 6.1 6.6 1.7 1.0 0.4 1.0 -0.1 0.3 4.1 (4.9) (5.7) (6.0) (5.7) (5.6) 3.9 0.7 0.5 0,7 0.1 0.0 0.1 0
Slide 37: Our Agenda
OUR AGENDA 1 The Usiminas 2 Usiminas Management Pillars People Customers Results 3 Governança corporativa 4 Appendix Classificação da informação: Uso Interno
Slide 38: Usiminas' Corporate Governance
Usiminas’ Corporate Governance Usiminas’ model of corporate governance meets government and market requirements for listed companies, preserving and encouraging transparency New Shareholders Agreement ✓On July, 2023, the Company’s amended and restated the Usiminas Shareholders Agreement - valid unti
Slide 39: Usiminas' Corporate Governance (Cont'd)
Usiminas’ Corporate Governance (Cont’d) Recently approved programs that ensure safety for the investor, transparency of actions, management control and clarity in communication Integrity Program Policies of the Brazilian Corporate Governance Code Policy of Destination of Results Code of Ethics a
Slide 40: Our Agenda
OUR AGENDA 1 The Usiminas 2 Usiminas Management Pillars People Customers Results 3 Governance and Highlights 4 Appendix Classificação da informação: Uso Interno
Slide 41: Over Half a Century of Leadership
Over Half a Century of Leadership Creation of Temporary shutdown Soluções Selling of of the primary areas Listing on Usiminas Ternium stake Automotiva Implementation of Operation Cosipa in Cubatão Stock trading LATIBEX stock One CNPJ: Joint Mining Usiminas codes and policies Restructuring of Start U
Slide 42: Main Highlights
Main Highlights 1 Leadership position in the Brazilian steel market, with presence in strategic international markets 2 Diversification of products and markets 3 Assets strategically located on the main industrial and logistics axis 4 Experienced and specialized administration 5 Solid corporate gove
Slide 43: Leading Position in the Brazilian Steel Market
Leading Position in the Brazilian Steel Market, with Presence in Strategic International Markets Usiminas’ leading position is underpinned by the superior quality of its products and the long-term relationship with key clients Sales Volumes – Steel – (Thousand Tons – Quarterly) 1,014 1,041 1,037 1,0
Slide 44: Diversification Across Products and Markets
Diversification Across Products and Markets Usiminas has capacity to produce a wide variety of steel, allowing for flexibility to adjust its production according to market demands domestically and internationally End Markets Share of Volume, 2Q24, Domestic Market Revenues by Country Share of Net Rev
Slide 45: Assets Strategically Located in the Country's Main Industrial Axis
Assets Strategically Located in the Country’s Main Industrial and Logistic Axis in the Country The location of Usiminas’ assets allows for access to raw materials (e.g. iron ore), consumption centers and logistic terminals (railways, ports) Classificação da informação: Uso Interno
Slide 46: Seasoned and Specialized Management Team
Seasoned and Specialized Management Team Usiminas’ Executive Board consists of professionals with deep knowledge in their respective areas Marcelo Chara CEO Toshihiro Miyakoshi Technology and Quality Vice President Officer • Over 40 years of experience in the steel industry. He served as Executive P
Slide 47: Usiminas' Corporate Governance (Cont'd)
Usiminas’ Corporate Governance (Cont’d) Recently approved programs that ensure safety for the investor, transparency of actions, management control and clarity in communication Integrity Program Policies of the Brazilian Corporate Governance Code Policy of Destination of Results Code of Ethics a
Slide 48: Culture of Employee, Social and Environmental Responsibility
Culture of Employee, Social andEnvironmental Responsibility Usiminas translates concepts into practice, conciliating the objective of all stakeholders Employee Investments in professional training and safety prove the ongoing commitment to the qualification, development and life of More than 200,000
Slide 49: Classificação da informação: Uso Interno
Classificação da informação: Uso Interno
Usinas Siderúrgicas de Minas Gerais — Q2 2024 Earnings Presentation on 6ix