Hindalco Industries Limited · NSE:HINDALCO

Hindalco Industries — Q2 FY14 Earnings Presentation

29 slides from Hindalco Industries's earnings presentation, Nov 12, 2013

  1. Slide 1: Investor Presentation Q2 FY14

    INVESTOR PRESENTATION Q2 FY14 November 12, 2013

  2. Slide 2: Highlights and Financial Performance

    HIGHLIGHTS AND FINANCIAL PERFORMANCE 2

  3. Slide 3: Global Economy: Signs of recovery

    Global Economy: Signs of recovery … USA Europe Emerging out Debt crisis postponed, of recession China economic data Growth moderately positive bottoming out India Growth weakness persists World economy appears to be healing, but financial markets remain vulnerable to shocks – especially QE tapering

  4. Slide 4: Al LME has remained subdued

    Al LME has remained subdued Aluminium LME ($/t)  Production cuts by smelters have accelerated outside China (~1.3 2600 4-yr low of $1,779 mtpa in 2013, and ~2.4 mtpa 2400 in Q2 FY14 cumulatively) 2200  2013 market balance expected to 2000 be almost neutral 1800  LME warehousing rules aimed at 160

  5. Slide 5: Strong consumption outlook for aluminium

    Strong consumption outlook for aluminium Sustained robust demand for Aluminium over the next few years Projected primary aluminium consumption by region (in MT) 2012 Actual 2013 Forecast Rest of World 49.6 2014E Rest of World Russia 1% 2% 10% India Latin America 6% 3% 5% Russia  2012 Global Asia w/

  6. Slide 6: Strong outlook for FRP

    Strong outlook for FRP 2012-2020 CAGR 30 ~5% 28 25 Automotive ~30% 20 18 Specialties ~6% 15 10 Can ~4-5% 5 0 2012 2015 2020 Auto Specialties Can Foil & Other FRP Industry strong prospects

  7. Slide 7: Highlights: Financial Highlights Q2 FY14

    HIGHLIGHTS … Financial Highlights Q2 FY 14 (YOY)… EBIDTA 4.6% PBIDTA 26.5% Stable PAT despite sharp increase in interest and depreciation Robust Performance despite several headwinds 7

  8. Slide 8: Highlights: Robust operational performance

    HIGHLIGHTS … Robust operational Performance…. For Q2 FY 14… Aluminium EBIT at Rs 166 Cr (Rs 170 Cr Q2 FY 13) Strong Performance by Copper Business post planned shutdown Copper EBIT at Rs 239 Cr (Rs 209 Cr Q2 FY 13) 8

  9. Slide 9: Highlights: Good progress on the projects

    HIGHLIGHTS … Good Progress on the projects... Mahan & Utkal ramp up progressing as per plan In Q2 FY14… Mahan produced 7.4 KT metal Utkal produced 41 KT hydrate Aditya gearing for first metal production Aditya debt refinanced… Annual interest savings of Rs 100 Cr 9

  10. Slide 10: Financial Performance

    Financial Performance: Change Change ` Cr Q2 FY14 Q2 FY13 H1 FY14 H1 FY13 (%, YoY) (%, YoY) Net Sales 6,305 6,164 2.3 12,143 12,191 (0.4) EBITDA 540 515 4.6 1,018 978 4.0 Other 280 132 111.4 708 434 63.2 Income PBITDA 820 648 26.5 1,726 1,412 22.1 PBT 440 447 (1.6) 1015 960 5.7 PAT 357 359 (0.5) 831

  11. Slide 11: Segmental Performance – Q2 FY14

    Segmental Performance – Q2FY 14 Aluminium Greenfield Copper SALES 37% 63% EBIT 41% 59% C.E 19% 66% 14%

  12. Slide 12: Performance Review: Aluminium

    PERFORMANCE REVIEW: ALUMINIUM 12

  13. Slide 13: Al: External factors.. A Mixed Bag

    Al: External factors.. A Mixed Bag Q2 FY14 vs. Q 2FY13 Impact LME ($/t) Exch. Rate (`/$) Ingot Premium Rising Key Input Prices 13

  14. Slide 14: Al: Production Performance

    Al: Production Performance Q2 Q2 (Kt) Change (%) FY14 FY13 Alumina 334 328 2.0 Metal 133 128 3.9 FRP 61 55 10.2 Extrusions 10 9 6.4  Metal output excludes 7.4 kt trial production at Mahan  FRP production includes 3.1 kt production at Hirakud 14

  15. Slide 15: Al: Financial Performance

    Al: Financial Performance Q2 Performance H1 Performance Net Sales (` Crore) Net Sales (` Cr) 2,343 2,211 H1 4167 2,105 FY13 H1 4554 FY14 Q2 FY13 Q1 FY14 Q2 FY14 EBIT (` Crore) EBIT (` Crore) H1 440 170 249 FY13 166 H1 415 FY14 Q2 FY13 Q1 FY14 Q2 FY14 15

  16. Slide 16: Novelis Highlights: Q2 FY14

    Novelis Highlights: Q2 FY14  Shipments Down 1% YoY to 713 Kilotonnes, Up 1% Sequentially  Net Sales of $2.4 Billion Flat YoY and Sequentially  Adjusted EBITDA Down 18% YoY to $228 Million, Up 12% Sequentially  Net Income of $23 Million; Excluding Certain Items, Net Income $37 Million  Free Cash

  17. Slide 17: Novelis Highlights: Q2 FY14

    Novelis Highlights: Q2 FY14 17

  18. Slide 18: Performance Review: Copper

    PERFORMANCE REVIEW: COPPER 18

  19. Slide 19: Cu: External drivers… largely negative

    Cu: External drivers… largely negative Q2 FY14 vs. Impact Q2 FY13 TCRC Slightly higher LME ($/t) Sharply lower Exch. Rate (`/$) Favourable Acid Price Significantly lower DAP Realization Weaker Sharp drop in co product realisations 19

  20. Slide 20: Cu: Production Performance

    Cu: Production Performance Cathode (kt) CCR (kt) DAP (kt) 11% 37 36 65 78 58 77 Q2 FY13 Q2 FY14 Q2 FY13 Q2 FY14 Q2 FY13 Q2 FY14  Overhaul of Copper-III in Q1 had a follow-through effect in July  Copper-III has done well after the shutdown– achieving better feed rate, plant uptime and operating eff

  21. Slide 21: Cu: Financial Performance

    Cu: Financial Performance Q2 Performance H1 Performance Net Sales (` Crore) Net Sales (` Cr) 4,066 3,974 H1 8038 3,636 FY13 H1 7610 FY14 Q2 FY13 Q1 FY14 Q2 FY14 195% EBIT (` Cr) EBIT (` Crore) 13% 209 239 H1 284 81 FY13 H1 320 FY14 Q2 FY13 Q1 FY14 Q2 FY14 Q1 FY14 EBIT was affected due to planned shu

  22. Slide 22: Greenfield Projects

    ADITYA BIRLA GREENFIELD PROJECTS

  23. Slide 23: Mahan: Ramp-up gathering steam

    Mahan: Ramp-up gathering steam Gross Metal Production (tonnes) Casthouse Furnace 4500 4000 4,009 3500 3000 2500 2000 1500 1000 500 0 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13  Pot addition has accelerated in last 2 months; 74 pots in line now vs. 32 in August  Two CPP units synchronized; Unit no.

  24. Slide 24: Utkal: Operations scaling up

    Utkal: Operations scaling up … CPP in operation Refinery overview  77 kt hydrate produced so far  Baphlimali mines: 5.9 lac MT of bauxite mined so far; overburden of 10.6 lac MT removed  Two units of Co-gen power plant synchronized 24

  25. Slide 25: Aditya Aluminium: Geared for start-up soon

    Aditya Aluminium: Geared for start-up soon Smelter Overview CPP Control Room Pot tending machine shop  ~ 7,500 people at site  Equipment testing completed, gearing up for first metal 25

  26. Slide 26: Key External Drivers - Outlook

    KEY EXTERNAL DRIVERS - OUTLOOK Driver Current Assessment LME • Demand is supportive, but concerns galore.. Over capacity, declining premium… INR USD • Uncertainty over FII flows may keep rupee depressed….. Energy, • Upward pressure related to Energy costs Input prices TcRc • 2014 terms likely to be

  27. Slide 27: Summing Up

    Summing Up Long spell of subdued LME has affected Aluminium industry margins in general –Re Depreciation though has helped us Aluminium demand continues to be robust Our new facilities progressing well, though EBITDA streams will take time to scale up with delayed captive coal access Stable outlook

  28. Slide 28: Thank you

    ADITYA BIRLA HINDALCO Thank you

  29. Slide 29: 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

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