Aluminium Bahrain B.S.C · BAHRAIN:ALBH
Aluminium Bahrain B.S.C — Q2 2014 Earnings Presentation
32 slides from Aluminium Bahrain B.S.C's earnings presentation, 2014
Slide 1: Aluminium for the world: Q2 2014 IR Presentation
Aluminium for the world Q2 2014 IR PRESENTATION albasmelter.com
Slide 2: Disclaimer
Aluminium for the world Disclaimer This document has been prepared and issued by and is the sole responsibility of Aluminium Bahrain B.S.C. (the “Company”). The document is being supplied to you solely for your information and for use at the Company’s presentation. No information made available to y
Slide 3: Contents
Aluminium for the world Contents 1- Industry Highlights 2- Alba Highlights 3- Q2 2014 Results 4- Industry Perspectives in 2014 5- 2014 Alba Priorities albasmelter.com 3
Slide 4: Industry Highlights
INDUSTRY HIGHLIGHTS Primary Reference for Industry Data is CRU
Slide 5: Aluminium Demand Still Strong
Aluminium for the world INDUSTRY HIGHLIGHTS Q2 2014 Aluminium Demand Still Strong (Reference Period: April - June) World consumption up by +6.9% YoY Asian demand up by 9% YoY driven by a robust growth in China (+10% YoY) with increased infrastructure investments and higher transport North American c
Slide 6: Production Evolution
Aluminium for the world INDUSTRY HIGHLIGHTS Q2 2014 Production Evolution (Reference Period: April-June) World market production up by 6.4% YoY China output hit a record level at 6.7 million tonnes (+13.4% YoY) on the back of production restarts and continued ramp-ups Lower LME price and higher energ
Slide 7: LME & Premiums
Aluminium for the world INDUSTRY HIGHLIGHTS Q2 2014 LME & Premiums LME inventories at 5.1 million metric tonnes in June 2Q14 cash-average was $1,798/t with LME ranging between $1,714/t on May 21 and $1,870/t on June 9 Physical premiums on upward march supported by a deficit in the world excluding Ch
Slide 8: Alba Highlights
‘~ ALBA HIGHLIGHTS
Slide 9: H1 2014 Operational Highlights/Achievements
Aluminium for the world Alba Highlights H1 2014 - Operational Highlights/Achievements Alba was able to increase its production figures by 2.5% YoY to reach 464,012 metric tonnes (mt) vs. 452,727 mt in 1H13 Sales of Value-Added Products at 65% vs. 66% in 1H13 Significant boost in physical premiums (3
Slide 10: Project Titan - Improve Cash Cost of $150/t by January 2016
Aluminium for the world Alba Highlights Project Titan - Improve Cash Cost of $150/t by January 2016 YTD June 2014: Project Titan on Track with Projected Savings of $88/t Project Titan - US$ per MT 150 100 88 YTD June Year-End January 2016 2014 2014 Target Final Target 1. Savings from Project Titan r
Slide 11: Q2 2014 Operational Highlights/Achievements
Aluminium for the world Alba Highlights Q2 2014 - Operational Highlights/Achievements Continued Focus on Operational Excellence Continuous Emphasis on Safety 4,000,000 hours without Lost Time Injury (LTI) milestone Launch of Summer Safety “BLIZZARD” Campaign Future Growth Bahrain Cabinet approves th
Slide 12: Q2 & H1 2014 Financial Key Performance Indicators
Aluminium for the world Alba Highlights Q2 & H1 2014 - Financial Key Performance Indicators Adjusted EBITDA up due to solid physical premiums & favorable plant performance amid lower LME prices Q2: US$97 million up by 8% YoY H1: US$191 million down by 12% YoY Adjusted Net Income up driven by higher
Slide 13: Q2 2014 Results
<: Q2 2014 RESULTS
Slide 14: Sales Analysis 2Q14 vs. 2Q13
Aluminium for the world Q2 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Sales Analysis 2Q14 vs. 2Q13 Higher Premium Partially Offset by Lower LME Prices 2Q14 vs. 2Q13 - Metal Sales Bridge (US$M) 16 500 25 1 11 300 498 478 100 Sales 2Q13 LME Product Mix Pricing Power Volume Sa
Slide 15: Maintain Optimum Product Mix
Aluminium for the world Q2 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Maintain Optimum Product Mix Sustain Value-Added Products & Leverage Pricing Power 2Q14 vs. 2Q13 - Sales by Product line Bridge Premium Above LME Trend US$ Per MT (000’s MT) 240 2 1 7 350 170 235 230 225
Slide 16: Cost Analysis 2Q14 vs. 2Q13
Aluminium for the world Q2 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Cost Analysis 2Q14 vs. 2Q13 2Q14 vs. 2Q13 - Direct Costs Bridge (US$M) 450 19 18 1 5 1 0 3 2 55 300 411 400 150 albasmelter.com RM Price RM Consumption Energy Cons Alumina Sales Inventory Ch. Plant Spendi
Slide 17: Adjusted EBITDA Bridge Gap Analysis 2Q14 vs. 2Q13
Aluminium for the world Q2 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Adjusted EBITDA Bridge Gap Analysis 2Q14 vs. 2Q13: Adjusted EBITDA Margin at 18.8% 2Q14 vs. 2Q13 - EBITDA Bridge (US$M Adjusted) 5 EBITDA 18.8% 100 EBITDA 17.4% 10 3 20 15 50 97 90 0 EBITDA 2Q13 Metal Sal
Slide 18: Cash Flow Bridge 2Q14 vs. 1Q14
Aluminium for the world Q2 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Cash Flow Bridge 2Q14 vs. 1Q14: Sound Cash Generation Despite Low LME Prices 1Q14 to 2Q14 Cash Flow Bridge (US$M) Free Cash Flow (US$M) 250 12 30 100 26 96 125 50 162 78 109 33 0 0 Cash CF from WC CAPEX P
Slide 19: Working Capital Trend as Percentage of Sales
Aluminium for the world Q2 2014 Results Working Capital Trend as Percentage of Sales: Pro-active Working Capital Management to Buffer Downturn Working Capital As percentage of Sales 22% 19% 18% 16% 14% Q2 2013 Q2 2014 Percentage albasmelter.com 19
Slide 20: Financial Summary Q2 2014
Aluminium for the world Q2 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Sound Management Performance Partially Offset by Lower LME Prices Financial Summary Q2 2014 Q2 2013 H1 2014 H1 2013 Average Cash LME (US$/MT) 1,798 1,834 1,753 1,918 Total Sales (US$M) 515 520 1,001 1,018
Slide 21: Industry Perspectives in 2014
INDUSTRY PERSPECTIVES IN 2014 Primary Reference for Industry Data is CRU
Slide 22: Physical Demand Expected to Remain Healthy
Aluminium for the world Industry Perspectives in 2014 Physical Demand Expected to Remain Healthy Key factors to be observed: Record physical premiums to be sustained in the short-term on the back of growing market deficit in the world ex. China (+ while market awaits court decision) North American d
Slide 23: Raw Materials Price Trends
Aluminium for the world Industry Perspectives in 2014 Raw Materials Price Trends Alumina spot index expected to slightly soften in H2 2014 Green Petroleum Coke prices to remain stable Aluminium Fluoride (ALF3) and Liquid Pitch prices to remain at the current levels post a soft decline in Q2 2014 alb
Slide 24: 2014 Alba Priorities
‘~ 2014 ALBA PRIORITIES
Slide 25: Sustainable Improvement & Preparation for Future Growth
Aluminium for the world 2014 Alba Priorities Sustainable Improvement & Preparation for Future Growth Continued Focus on Safety & Training Deliver on Project Titan Leverage Strong Physical Demand Conditions Sustained focus on Value-Added Sales Increase Creep Capacity with Minimal Capital Investment L
Slide 26: Appendix
APPENDIX
Slide 27: Sales Analysis 1H14 vs. 1H13
Aluminium for the world H1 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Sales Analysis 1H14 vs. 1H13 Higher Premium Partially Offset by Lower LME Prices 1H14 vs. 1H13 - Metal Sales Bridge (US$M) 1,000 4 34 97 0 700 996 937 400 Sales 1H13 LME Product Mix Pricing Power Volume S
Slide 28: Maintain Optimum Product Mix
Aluminium for the world H1 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Maintain Optimum Product Mix Sustain Value-Added Products & Leverage Pricing Power 1H14 vs. 1H13 - Sales by Product line Bridge Premium Above LME Trend US$ Per MT (000’s MT) 500 5 3 0 350 400 454 456 300
Slide 29: Cost Analysis 1H14 vs. 1H13
Aluminium for the world H1 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Cost Analysis 1H14 vs. 1H13 1H14 vs. 1H13 - Direct Costs Bridge (US$M) 3 3 800 3 40 16 0 13 2 600 55 762 780 400 200 albasmelter.com RM Price RM Consumption Energy Cons Alumina Sales Inventory Ch. Plant S
Slide 30: Adjusted EBITDA Bridge Gap Analysis 1H14 vs. 1H13
Aluminium for the world H1 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Adjusted EBITDA Bridge Gap Analysis 1H14 vs. 1H13: Adjusted EBITDA Margin at 19.1% 1H14 vs. 1H13 - EBITDA Bridge (US$M Adjusted) 250 EBITDA 21.2% 13 EBITDA 19.1% 58 18 42 3 125 216 191 0 EBITDA 1H13 Metal
Slide 31: Cash Flow Bridge 2Q14 vs. Year-End 2013
Aluminium for the world H1 2014 Results FAVORABLE MANAGEMENT PERFORMANCE DESPITE LOW LME LEVELS Cash Flow Bridge 2Q14 vs. Year-End 2013: Sound Cash Generation Despite Low LME Prices Year-End 2013 to 2Q14 Cash Flow Bridge (US$M) Free Cash Flow (US$M) 20 400 53 200 82 192 200 86 100 158 172 162 104 0
Slide 32: For more information, contact us on: IR@alba.com.bh
FOR MORE INFORMATION, CONTACT US ON: IR@alba.com.bh
Aluminium Bahrain B.S.C. — Q2 2014 Earnings Presentation on 6ix