Boliden Ab · OMXSTO:BOL
Boliden Ab — Q1 2020 Earnings Presentation
33 slides from Boliden Ab's earnings presentation, Apr 28, 2020
Slide 1: Q1 Interim Report 2020
• Click to edit Master text styles ‒ Second level ‒ Third level ‒ Fourth level ‒ Fifth level Q1 Interim Report 2020 Mikael Staffas, President & CEO Håkan Gabrielsson, CFO
Slide 2: Q1 2020 – Stable production in Smelters but production disruptions in Tara
Q1 2020 – Stable production in Smelters but production disruptions in Tara MSEK Group EBIT ex PIR* R4Q, MSEK • Covid-19 crisis management and 3 400 3 200 10 200 9 600 response 3 000 9 000 2 800 8 400 2 600 7 800 • EBIT excl. PIR* 1,504 (2,048) MSEK 2 400 7 200 2 200 6 600 2 000 6 000 1 800 5 400 • F
Slide 3: Q1 2020 Covid-19 crisis management and response
Q1 2020 Covid-19 crisis management and response Global mining trends • Mine production negatively affected • Volatile smelter production • Challenges in logistics • Dried up access to short term liquidity Current effects on Boliden • Increased short-term leave • Transfer of open pit haul trucks dela
Slide 4: Base metal prices
Base metal prices Copper price, USD/tonne Copper KTonnes Zinc price, USD/tonne Zinc KTonnes 12 000 2 400 4 000 2 400 3 500 2 100 10 000 2 000 3 000 1 800 8 000 1 600 2 500 1 500 2 000 1 200 6 000 1 200 1 500 900 4 000 800 1 000 600 2 000 400 500 300 0 0 0 0 2009 2010 2011 2012 2013 2014 2015 2016 20
Slide 5: Gold, silver and lead prices
Gold, silver and lead prices Gold Lead Gold price, USD/troy oz. Lead price, USD/tonne 2 000 4 000 1 800 3 500 1 600 3 000 1 400 1 200 2 500 1 000 2 000 800 1 500 600 1 000 400 200 500 0 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 20
Slide 6: Zn, Cu and Ni prices relative to cash cost
Zn, Cu and Ni prices relative to cash cost Zinc Copper Nickel USD/tonne USD/tonne USD/tonne 5 000 11 000 35 000 4 500 10 000 30 000 4 000 9 000 3 500 8 000 25 000 7 000 3 000 6 000 20 000 2 500 5 000 2 000 15 000 4 000 1 500 10 000 3 000 1 000 2 000 5 000 500 1 000 0 0 0 Zn average price Zn max pric
Slide 7: Boliden market term index
Boliden market term index Note: Index 100 = 1 January 2015 Boliden Group Q1 2020 7 2020-04-28
Slide 8: Mines
• Click to edit Master text styles ‒ Second level ‒ Third level ‒ Fourth level ‒ Fifth level Mines Aitik view over the open pit Boliden Group Q1 2020 8 2020-04-28
Slide 9: Mines Q1 2020
Mines Q1 2020 Mines EBIT R4Q, • EBIT 318 (1,353) MSEK MSEK MSEK 2 600 7 800 ‒ 890 MSEK in Q4 2019 2 400 7 200 2 200 6 600 2 000 6 000 • Lower volumes 1 800 5 400 1 600 4 800 ‒ Lower grades 1 400 4 200 ‒ Production disruptions in Tara 1 200 3 600 1 000 3 000 800 2 400 • Worse prices & terms 600 1 800
Slide 10: Mines – Q1 Production
Mines – Q1 Production Milled ore, Metal content, Mtonnes Copper Ktonnes 16 48 14 42 12 36 10 30 8 24 6 18 4 12 2 6 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2016 2017 2018 2019 2020 Milled ore Metal content pro forma** Metal content Milled ore, Mtonnes Nickel Metal content, Ktonnes • Cu
Slide 11: Smelters
• Click to edit Master text styles ‒ Second level ‒ Third level ‒ Fourth level ‒ Fifth level Smelters Rönnskär, the anode foundry, glowing anode Boliden Group Q1 2020 11 2020-04-28
Slide 12: Smelters Q1 2020
Smelters Q1 2020 Smelters EBIT excl. PIR* • EBIT excl. PIR* 1,117 (853) MSEK R4Q, MSEK MSEK 1 300 3 900 ‒ 759 MSEK in Q4 2019 1 200 3 600 1 100 3 300 • Better prices & terms 1 000 3 000 900 2 700 ‒ Higher Zn TC´s 800 2 400 700 2 100 • Higher volumes 600 1 800 ‒ Improved process stability 500 1 500 4
Slide 13: Smelters – Q1 Production
Smelters – Q1 Production Copper Metal Total feed, production, Ktonnes Ktonnes 400 120 • Cu production 95 (87) ktonnes 350 105 ‒ Production record in Harjavalta 300 90 250 75 200 60 150 45 • Zn production 127 (122) ktonnes 100 30 50 15 ‒ Record feed in Odda 0 0 ‒ Improved process stability in Kokkola
Slide 14: Financials
• Click to edit Master text styles ‒ Second level ‒ Third level ‒ Fourth level ‒ Fifth level Financials Pori/Harjavalta silver Boliden Group Q1 2020 14 2020-04-28
Slide 15: 2020 Q1 – Earnings
2020 Q1 – Earnings MSEK Q1 2020 Q1 2019 Q4 2019 Revenues 13,210 13,047 12,972 EBITDA 2,693 3,737 3,053 EBIT 1,435 2,441 1,744 EBIT excl. PIR 1,504 2,048 1,721 Investments 1,823 1,606 3,255 Free cash flow -845 -323 822 Earnings per share, SEK 3.90 6.91 4.97 Net debt / equity ratio, % 15 6 13 Boliden
Slide 16: EBIT excl. PIR by segment
EBIT excl. PIR by segment MSEK Q1 2020 Q1 2019 Q4 2019 Mines 318 1,353 890 Smelters 1,117 853 759 Other / eliminations 69 -158 71 The Group 1,504 2,048 1,721 Boliden Group Q1 2020 16 2020-04-28
Slide 17: Q1 2020 vs. Q1 2019
Q1 2020 vs. Q1 2019 Group EBIT excl. PIR MSEK Q1 2020 1,504 Q1 2019 2,048 Lower grades but higher throughput in Deviation -544 open pit mines Production disruptions in Tara Specification of deviation Volumes -561 Stronger USD Higher Zn TC´s Prices and terms 30 Higher prices on precious metals Whereo
Slide 18: Q1 2020 vs. Q4 2019
Q1 2020 vs. Q4 2019 Group EBIT excl. PIR MSEK Q1 2020 1,504 Q4 2019 1,721 Deviation -217 Specification of deviation Higher free metals and less maintenance in Smelters Volumes -59 Production disruptions in Tara Prices and terms -188 Whereof currency 29 Lower metal and by-product prices Costs -36 Dep
Slide 19: Cash flow
Cash flow MSEK Q1 2020 Q1 2019 Q4 2019 EBITDA excl. PIR 2,762 3,345 3,030 Cash flow from working capital -1,284 -1,507 1,685 Inventories -484 -1,231 -425 Operating receivables -199 -815 -111 Operating liabilities -635 551 2,229 Other 34 -11 -8 Cash flow from investments -1,821 -1,603 -3,269 Financia
Slide 20: Balance sheet
Balance sheet SEK bn 31 Mar 31 Mar 31 Dec Net debt & Gearing 2020 2019 2019 MSEK % Total Assets 68.5 61.7 66.4 12 000 45 Capital employed 52.6 47.2 49.8 10 000 40 35 Equity 43.3 41.2 41.4 8 000 30 25 Net debt 6.5 2.6 5.5 6 000 20 Net debt / equity ratio, %* 15 6 13 4 000 15 10 Loan duration, years 3
Slide 21: Post Q1 2020, Strengthening the payment capacity
Post Q1 2020, Strengthening the payment capacity* • New loans in April • Nordic Investment Bank, 100 MEUR • 8 year tenor • Swedish Export Credit Corporation 2,500 MSEK • 4 year tenor • Simultaneously a loan from Swedish Export Credit Corporation of 570 MSEK is amortized • Extension of revolving cred
Slide 22: Going forward
Going forward • Aitik ‒ 2020: Cu 0.25%, lower in Q2 ‒ 2020: 45 Mtonnes milled volume pace by Q3 • Garpenberg ‒ 2020: Zn 3.7%, Ag 100 g/tonne ‒ 2020: 3 Mtonnes milled volume • Kevitsa ‒ 2020: Slightly below reserve grade ‒ 2020: 9.5 Mtonnes milled volume pace by Q3 Boliden co-worker • Headwind on pre
Slide 23: Disclaimer
Disclaimer • This presentation has been prepared by Boliden for information purposes only and as per the indicated date. Boliden does not undertake any obligation to correct or update the information or any statements made therein. Certain statements in this presentation are forward-looking and are
Slide 24: Appendix
• Click to edit Master text styles ‒ Second level ‒ Third level ‒ Fourth level ‒ Fifth level Appendix Aitik was awarded Svemin’s Work Environment Prize 2020 Boliden Group Q1 2020 24 2020-04-28
Slide 25: Boliden, key attractions
Boliden, key attractions • Well positioned in the metal market ‒ Mines and Smelters ‒ Base metals and precious metals ‒ High productivity/stable production ‒ High corporate responsibility ‒ Long life of key mines ‒ Stable jurisdictions • Strong balance sheet • Several growth opportunities ‒ Smelters
Slide 26: Metal prices and USD/SEK since Jan 1, 2018
Metal prices and USD/SEK since Jan 1, 2018 Source: Refinitiv Datastream, prices up to and including April 27, 2020 Boliden Group Q1 2020 26 2020-04-28
Slide 27: Metal prices and USD/SEK – year on year
Metal prices and USD/SEK – year on year Source: Refinitiv Datastream, prices up to and including April 27, 2020 Boliden Group Q1 2020 27 2020-04-28
Slide 28: Zinc TC and premia
Zinc TC and premia US$/t Treatment charges US$/t metal Metal premia concentrate 350 250 300 200 250 200 150 150 100 100 50 50 0 0 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 Contract TC - realized Ex-Works Premia Europe Spot TC imported concentrate to China Delivered Premia US Midwest Contract
Slide 29: Copper TC and premia
Copper TC and premia US$/t Treatment charges concentrate US$/t metal Metal premia 120 60 100 50 80 40 60 30 40 20 20 10 0 0 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 CIF Average European premia Contract TC - annual and mid-year benchmark Standard grade spot TC Contract benchmark according to
Slide 30: Economic development
Economic development China, USA – March Eurozone, World - February Boliden Group Q1 2020 30 2020-04-28
Slide 31: Construction – largest segment for Cu and Zn
Construction – largest segment for Cu and Zn China, USA – March EU - February Boliden Group Q1 2020 31 2020-04-28
Slide 32: Automotive
Automotive Q1 2020 Boliden Group Q1 2020 32 2020-04-28
Slide 33: • Click to edit Master text styles
• Click to edit Master text styles ‒ Second level ‒ Third level ‒ Fourth level ‒ Fifth level Boliden Group Q1 2020 33 2020-04-28