Hindalco Industries Limited · NSE:HINDALCO
Hindalco Industries — Q1 FY18 Earnings Presentation
30 slides from Hindalco Industries's earnings presentation, Aug 11, 2017
Slide 1: Hindalco Investor Presentation – Q1 FY18
Hindalco Investor Presentation – Q1 FY18 August 11, 2017 Mumbai Excellence by Design
Slide 2: Forward Looking & Cautionary Statement
Forward Looking & Cautionary Statement Certain statements in this report may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the
Slide 3: Agenda
Agenda 1 Key Highlights 2 Economy & Industry 3 Result Highlights 4 Operational and Financial Performance Aluminium (India) Copper Novelis Excellence by Design 3
Slide 4: Key Highlights
Key Highlights Excellence by Design
Slide 5: Key Highlights (1/2)
Key Highlights (1/2) Deleveraging Prepaid Rs. 4,505 crore in April 2017 at Hindalco standalone and Rs. 894 crore in July 2017 at Utkal - Till date total prepayment of Rs. 5,399 crore in FY18 Coal Security Awarded new coal linkage of 2.9 million tonne in Q1 FY18 Aluminium India New Plants opera
Slide 6: Key Highlights (2/2)
Key Highlights (2/2) Copper Cathode production at 109 Kt was up 67% vs Q1FY17 mainly due to planned shutdown in last year CC Rod production at 40 Kt increased by 7% vs Q1FY17 EBITDA at Rs. 322 crore increased 22% Y-o-Y on account of higher sales volume partly offset by lower by-product realiza
Slide 7: Economy and Industry
Economy and Industry Excellence by Design
Slide 8: Economy
Economy Global Economy ○ The U.S economy in H1CY17 grew at an average rate of 2.0% ○ In Euro region, employment rate and private consumption are picking up, along with easing of political uncertainties. ○ China expanded more than expected in H1CY17 at 6.9%, due to steady rise in retail sales and ind
Slide 9: Aluminium Industry
Aluminium Industry Environmental & supply side Aluminium Price Trend (USD/t) restrictions in China coupled with 1857 1,902 1,931 1,914 1,887 1,904 1,927 weak US Dollar and strong 1,791 1,666 1,737 1,728 industrial activities supported LME 1,629 1,639 1,571 1,551 1,594 1,592 in Q1FY18 ◊ Aluminium r
Slide 10: Aluminium Industry Drivers
Aluminium Industry Drivers ○ Initiation of production cut in China and increase in input cost supported realization – Increase in LME over previous quarter was negated by stronger rupee ○ Regional premium improved due to decline in LME inventory ○ Demand in domestic market was subdued; market remain
Slide 11: Copper Industry
Copper Industry ○ LME in copper was majorly driven by the series of disruptions during first few months of CY 2017 and unexpected expansion in Chinese growth. Weak US dollar also supported copper LME to move upwards. ○ China has announced ban on level seven grade scrap imports by end of CY18 includi
Slide 12: Result Highlights Q1 FY18 - Strong Operating Performance
Result Highlights Q1 FY18 - Strong Operating Performance Excellence by Design
Slide 13: Q1FY18 – Standalone Highlights
Q1FY18 – Standalone Highlights Revenue EBITDA Net Profit Utkal EBITDA Rs. 10,407 crore Rs. 1,404 crore Rs. 290 crore Rs. 291 crore (Y-o-Y up 28%) (Y-o-Y up 4%) (Y-o-Y down 2%) (Y-o-Y up 207%) • Overall strong • Higher • Higher performance • Higher cathode and volume and and saving in realization for
Slide 14: Operational Performance Aluminium (India)
Operational Performance Aluminium (India) Excellence by Design
Slide 15: Production Trend
Production Trend Alumina (KT) includes Utkal VAP incl. Wire Rod (KT) 2% 15% 708 712 724 120 104 109 Q1 FY 17 Q4 FY17 Q1 FY18 Q1 FY 17 Q4 FY17 Q1 FY18 Plants continue to operate at Metal (KT) designed capacity 4% ◊ Alumina production up by 2% and 308 317 321 Metal production up by 4% VAP producti
Slide 16: Utkal
Utkal Production (KT) 3% Plant continue to operate at designed capacity 372 364 384 Cash cost of Alumina refinery is amongst the lowest in the world Signed Long Term Tariff Contract Q1 FY 17 Q4 FY17 Q1 FY18 (LTTC) with railways for transport of inward raw material and outward finished product
Slide 17: Operational Performance Copper
Operational Performance Copper Excellence by Design
Slide 18: Production
Production Cathode (KT) CC Rods (KT) 67% 7% 111 109 38 40 37 65 Q1 FY 17 Q4 FY17 Q1 FY18 Q1 FY 17 Q4 FY17 Q1 FY18 DAP (KT) ○ Cathode production was up 67% due 29% to lower base (planned shutdown last 94 year) 67 62 ○ CC rod production was higher by 7% ○ DAP production impacted due to operational iss
Slide 19: Operational Performance Novelis
Operational Performance Novelis Excellence by Design
Slide 20: Key Highlights
Key Highlights Total Shipments (KT) ○ Total flat rolled product shipments grew 4%to 785 Kt 4% 789 785 Excluding 6 Kt from the prior year related to the 755 divested Alcom Business in Asia, shipments were up 5% ○ Aluminium Auto sheet demand Q1 FY 17 Q4 FY17 Q1 FY18 continued to be robust Automoti
Slide 21: Financial Performance
Financial Performance Excellence by Design
Slide 22: Financial Highlights – Standalone
Financial Highlights – Standalone (Rs. crore) Description Q1 FY 17 Q4 FY17 Q1 FY18 Revenue from Operations 8,159 11,747 10,407 Earnings Before Interest, Tax and Depreciation (EBITDA) Aluminium 871 918 875 Copper 264 497 322 Others (including Other Income) 216 155 207 Total EBITDA 1,351 1,570 1,404 D
Slide 23: Aluminium Standalone
Aluminium Standalone Revenue (Rs. crore) EBITDA (Rs. crore) 9% 871 918 875 5,548 5,008 4,591 Q1 FY 17 Q4 FY17 Q1 FY18 Q1 FY 17 Q4 FY17 Q1 FY18 • Y-o-Y Revenue up due to higher volume and realization • EBITDA marginally up on the back of supportive macro, higher volume, stable operations largely offs
Slide 24: Utkal
Utkal EBITDA (Rs. crore) 207% 291 265 95 Q1 FY 17 Q4 FY17 Q1 FY18 • Strong performance on back of stable operations • 207% Y-o-Y growth in Q1 FY18 on the back of higher realization. However higher alumina prices result in higher input cost for Hindalco standalone Excellence by Design 24
Slide 25: Copper
Copper Revenue (Rs. crore) EBITDA (Rs. crore) 22% 51% 6202 5403 497 322 3571 264 Q1 FY 17 Q4 FY17 Q1 FY18 Q1 FY 17 Q4 FY17 Q1 FY18 • Revenue up due to higher volume and copper LME • EBITDA for Q1 FY18 was Y-o-Y up by 22% : Higher volumes partly offset by lower by-product realization & higher input c
Slide 26: Novelis
Novelis Revenue (USD billion) Adjusted EBITDA* (USD million) 16% 8% 2.6 2.7 292 289 2.3 268 Q1 FY 17 Q4 FY17 Q1 FY18 Q1 FY 17 Q4 FY17 Q1 FY18 • Revenue increase by 16% driven by higher shipments and Metal price. • EBITDA grew by 8% primarily on account higher shipments, ongoing operational improveme
Slide 27: Hindalco: Sustainable Performance
Hindalco: Sustainable Performance Stronger Balance Sheet ○ Deleveraging exercise continues - Rs. 5,399 crore prepaid till date in FY18 + Rs. 1,031 pre paid in FY17 Robust Operational ○ Robust performance on the back of stable plant operations Performance along with higher Aluminium and Copper prices
Slide 28: Thank You
Thank You REGISTERED OFFICE Century Bhavan, 3rd Floor, Dr. Annie Besant Road, Worli, Mumbai 400 030 Telephone- +91 22 6662 6666 Website: www.hindalco.com E mail: hindalco@adityabirla.com Corporate Identity No. L27020MH1958PLC011238 Excellence by Design
Slide 29: Appendix
Appendix Excellence by Design
Slide 30: Sales Volume
Sales Volume Aluminium Metal sales in all form Copper sales (KT) (KT) 3% 69% 328 114 290 299 105 62 Q1 FY 17 Q4 FY17 Q1 FY18 Q1 FY 17 Q4 FY17 Q1 FY18 Excellence by Design 30