Slide 1: Acerinox FY 2020 Results Presentation
ACERINOX FY 2020 RESULTS PRESENTATION 1 March 2021 ACERINOX 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: FY 2020: A very robust year under incredibly challenging circumstances
FY 2020: A very robust year under incredibly challenging circumstances Million EUR Control of business and variabilization of fixed costs Delivered a robust EBITDA against a very challenging backdrop Exceptionally strong operating cash flow generation of 421 million EUR Net Debt/EBITDA 2.0x Ongoing
Slide 4: Sustainability / ESG focus
Sustainability / ESG focus The Group contributes to the 17 United Nations Sustainable Development Goals ENVIRONMENT SOCIAL ● Leader in Circular Economy ● High-quality Employment ○ +90% recycled content rate of our products ○ 98% of employees have permanent contract ○ +80% reuse of generated waste ●
Slide 5: Focus on operations, cash flow and capital allocation
Focus on operations, cash flow and capital allocation 5 ACERINOX 2020 RESULTS PRESENTATION
Slide 6: Q4 - signs of recovery have emerged
Q4 - signs of recovery have emerged Million EUR Q4 saw a strong recovery into year end Demonstrated our flexibility - cost control when needed but we are always prepared to take advantage of an improving market Strong improvement in EBITDA QoQ Another quarter of strong cash generation 6 ACERINOX 202
Slide 7: Stainless Group figures Q4 2020 and Full Year
Stainless Group figures Q4 2020 and Full Year Focus on cost reductions for much of the year : ● Personnel: 16% ● Operating: 16% Very strong cash generation, especially in Q4 Sequential improvement in EBITDA in Q4 Our flexibility and agility means we were well positioned to benefit from the rebound i
Slide 8: High Performance Alloys figures Q4 2020 and Full Year
High Performance Alloys figures Q4 2020 and Full Year Environment remained challenging from Q2 onwards... …But operating cash flow generation was very strong at 84 million EUR And now positive signs that order books are recovering in early 2021 with an expected lag to stainless steel VDM integration
Slide 9: Strong cash flow allows optimal capital allocation
Strong cash flow allows optimal capital allocation Million EUR Focus on FCF generation to enable us to Q4 allocate capital in the best possible way for the core business, for profitable growth and for shareholder returns ★ We control the controllables of our business to generate the maximum possible
Slide 10: We maintain very strong liquidity and balance sheet even post VDM
We maintain very strong liquidity and balance sheet even post VDM Liquidity and Balance Sheet remain very strong 1,772 Our liquidity covers all future term- debt obligations Net debt to EBITDA is 2.0x Net debt to equity is 48% The cost of our term debt remains competitive 97% of gross debt, 1,689 mi
Slide 11: Objectives for 2021
Objectives for 2021 Control: running the business to maximise profitability and accelerate the integration of VDM Cashflow: to generate the maximum possible free cashflow from the profits we generate Capital allocation: optimise capital allocation between the existing business, selective growth, bal
Slide 12: Our sustainable long term goals
Our sustainable long term goals Emissions: CO2 tonnes / tonne Waste: (%) tonnes to landfill / generated tonnes 2015 2020 2030 2019 2020 2030 Reduction in GHG emissions 1.19 1.11 0.95 28.70% 22.00% 2.20% intensity (Scope 1&2) by 2030 Reduction of waste to landfill by from 2015 baseline -6.72 % -20 %
Slide 13: Outlook
Outlook ▪ Strong demand in stainless steel in Q1 ▪ Base price increase achieved in the US ▪ Green shoots of recovery in high performance alloys ▪ Q1 2021 EBITDA should be slightly higher than in Q4 2020 ACERINOX 2020 RESULTS PRESENTATION
Slide 14: Conclusions
Conclusions • In 2020 we reacted fast to the extraordinary challenges presented by the COVID driven crisis • We focused on control: safety, liquidity, supply chains and variabilising fixed costs to maintain profitability • Flexible, agile and ready to rapidly benefit from a recovery • Consistently f
Slide 15: Value creation for all stakeholders
VALUE CREATION FOR ALL STAKEHOLDERS ACERINOX 2020 RESULTS PRESENTATION
Slide 16: Acerinox a value for the future
Acerinox a value for the future Acerinox a value for the future 16 16 ACERINOX 2020 RESULTS PRESENTATION
Slide 17: Acerinox Investment Opportunity: A Value for the Future
Acerinox Investment Opportunity: A Value for the Future A Global Leader in Stainless Steel and High Performance Alloys B Highest Quality Standards C Solid Long Term Strategy D Attractive Resilient Investment Opportunity E Diversification Strategy resulting in High Growth and Significant Value Added
Slide 18: Global Leader in Stainless Steel and High Performance Alloys
Global Leader in Stainless Steel and High A Performance Alloys Clear Leader in Stainless Steel in USA c50% of our sales in America c35% Market share in President Biden Plan to Build a Modern, Sustainable Infrastructure and an Equitable the US Clean Energy Future could represent impressive demand for
Slide 19: Global Leader in Stainless Steel and High Performance Alloys
Global Leader in Stainless Steel and High A Performance Alloys Leaders in High Performance Alloys in EU 26% Market share in the EU 13% Market share worldwide High Performance Alloys will also benefit from infrastructure investments programs 19 ACERINOX 2020 RESULTS PRESENTATION
Slide 20: Highest Quality Standards
B Highest Quality Standards High Sustainable Products With No Alternative Substitution Acerinox recycled content ratio in 2019 was > 90% Profitable Corrosion Long lasting resistant Efficient & Versatile Aesthetic (mechanical qualities) Hygienic Reusable 100% recyclable 20 ACERINOX 2020 RESULTS PRESE
Slide 21: Highest Quality Standards: Diversified End Users
B Highest Quality Standards Diversified End Users: One Stop Shop Sophisticated products with high growth potential Stainless Steel High Performance Alloys ther O Transport Electrical 5% Machinery 8% Automotive Others 6% 11% Motor Vehicles Aerospace lectrics / E 8% 30% etal M Electronics P
Slide 22: Present In Every Aspect Of Life
B Highest Quality Standards Present In Every Aspect Of Life Transport Food & beverages High Resistance to Corrosion, Withstand High Temperatures and Pressures and High Mechanical Hygienic and Clean Material, Ideal for the Production, Performance Handling and Transport of Food Containers, tanks and
Slide 23: Sophisticated Products Require Best In Class Materials
B Highest Quality Standards Sophisticated Products Require Best In Class Materials Infrastructures and construction Art Chosen as structural steel to prevent rusting and corrosion Refurbish historic works, turned to this material on from carbonation. Nickel alloys resistant to high temperatures many
Slide 24: Stainless Steel And High Performance Alloys: Sustainable Products
B Highest Quality Standards Stainless Steel And High Performance Alloys: Sustainable Products Water Facilitate life and adaptation Minimal corrosion, does not contaminate the water and does Increasing presence in life and becoming essential. not require any extra covering. Permits design corrections
Slide 25: Our Long Term Strategy Remains Intact
C Solid Long Term Strategy Our Long Term Strategy Remains Intact Strong balance sheet: efficient capital allocation Improving due to digitalization and 360º planning, cost reduction programs and optimizing the commercial network Excellence Added value enhanced by VDM Metals (HPA) and Added constant
Slide 26: Mission, Vision, Values
C Solid Long Term Strategy MISION, VISION, VALUES VALUES VISION MISION Employer of Become a global Safety Sustainability choice customer centric Create high supplier through performance innovation in Long-term Integrity Commitment materials for a sustainable Stainless focus sustainable society Steel
Slide 27: Strong Balance Sheet Despite Covid-19 Disruption
C Solid Long Term Strategy Strong Balance Sheet Despite Covid-19 Disruption Extremely liquid Liquidity Position (€m) Net Debt Liquidity remains best in class, fully covering Robust balance sheet all maturities Net Financial Debt of €772m Weighted Cost of Term Debt of 1.5% ND / LTM EBITDA of 2.0x 97%
Slide 28: Highly Experienced Management Team
C Solid Long Term Strategy Highly Experienced Management Team Average of More than 20 Years of Experience in the Sector Rafael Miranda Bernardo Velázquez Hans Helmrich Miguel Ferrandis Chairman CEO COO CFO Oswald Wolfe Luis Gimeno Daniel Azpitarte Director Institutional Cristobal Fuentes General Cou
Slide 29: Constantly Improving
C Solid Long Term Strategy Constantly Improving Production: Quality, melting shop yields and efficiency in production materials Supply chain: Delivery on time Excellence 360º Digitalization and 360º planning Cost reduction programs Prioritize quick return investments Optimize the commercial network
Slide 30: Supportive Recommendation from Analysts on the back of Strong Estimates
D Attractive Resilient Investment Opportunity Supportive Recommendation from Analysts on the back of Strong Estimates Attractive Sales, EBITDA and Net Profit Estimates ESTIMATES 2021 (€m) 1 ESTIMATES 2022 (€m) 1 Sales EBITDA Net Profit Sales EBITDA Net Profit 5,335 470 185 5,715 537 232 YoY Growth 7
Slide 31: Agile Measures to the COVID Outbreak Have Ensured Resiliency
D Attractive Resilient Investment Opportunity Agile Measures to the COVID Outbreak Have Ensured Resiliency We Prepared Early and Acted Decisively Safety and prevention measures Our management team took Acerinox through 2008/2009 successfully and efficiently Fixed costs reduction and variabilis
Slide 32: Ongoing Growth
E Adding Value Through Diversification Ongoing Growth Acerinox S.A. 100% Acerinox, S.A. 76% Acerinox, S.A. 98% Incorporation of Acerinox S.A. 100% I.D.C. 24% Hanwa 2% ACERINOX, Incorporation of S.A.(Spain) NORTH Incorporation of Incorporation of Incorporation of AMERICAN COLUMBUS BAHRU VDM Metals ST
Slide 33: Production Sites
E Adding Value Through Diversification Production Sites Stainless Steel Division Stainless Steel Division Flat product Flat product Melting Shop Middelburg Melting Shop Kentucky Hot Rolling Shop Hot Rolling Shop Cold Rolling Shop Cold Rolling Shop Long product Hot Rolling Finished Product Flat produ
Slide 34: Strong Global Presence
E Adding Value Through Diversification Strong Global Presence Combined Global Footprint and Sales by Region Acerinox (12M 2019) Unna Africa Others Altena 4% 1% Duisburg Werdohl Asia Siegen 12% Europe 35% America Reno Spain 48% Florham Park United States (12M 2020)1 Acerinox Plants (6) Africa Others
Slide 35: A Leader In Stainless And HPA
E Adding Value Through Diversification A Leader In Stainless And HPA Creating value through: • Enhancement of product mix VDM: Acerinox: • Projects and tailor-made solutions world’s largest • Exceptional R&D capabilities global leader in stainless steel producer in high • Diversification of geograph
Slide 36: Solid Revenue And Earnings Growth
E Adding Value Through Diversification Solid Revenue And Earnings Growth CONSOLIDATED GROUP FIGURES Sales EBITDA Net Financial Debt 772 489 5,011 4,754 480 4,627 4,668 398 402 609 14 552 38 495 398 384 364 374 2017 2018 2019 2020 2017 2018 2019 2020e 2017 2018 2019 2020 2019: 38 million EUR for the
Slide 37: Strong Cash Generation
E Adding Value Through Diversification Strong Cash Generation CONSOLIDATED GROUP FIGURES 37 ACERINOX 2020 RESULTS PRESENTATION