Aluminium Bahrain B.s.c · BAHRAIN:ALBH
Aluminium Bahrain B.s.c — Q2 2022 Earnings Presentation
37 slides from Aluminium Bahrain B.s.c's earnings presentation, Sep 11, 2022
Slide 1: Investor Relations Presentation Q2 2022
INVESTOR RELATIONS PRESENTATION Q2 2022
Slide 2: Disclaimer
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 you in connection with th
Slide 3: Contents
CONTENTS 01 02 03 Industry Alba Q2 2022 Highlights Highlights Results 04 05 06 Industry Perspectives 2022 Alba Appendix in 2022 Priorities Page 3
Slide 4: Industry Highlights
01 INDUSTRY HIGHLIGHTS1 1 Industry Highlights are based on CRU Market Intel Page 4
Slide 5: Economic Uncertainty Takes its Toll on Global Aluminium Industry (-2% YoY)
Economic Uncertainty Takes its Toll on Global Aluminium Industry (-2% YoY) Weak economic activity, higher inflation and rising interest rates are hitting all manufacturing industries, and this has affected consumer demand negatively as buyers are forced to cut back on non-essential items US: Alumini
Slide 6: World Market Supply up by 3% YoY
World Market Supply up by 3% YoY Macroeconomic factors continue to pressure markets, resulting in unclear direction and price trends in commodities China: A net exporter as its output reached record levels (up by 4% YoY) since April, but demand has not followed the same path due to impact of lockdow
Slide 7: LME Price & Premiums
LME Price & Premiums LME-Cash averaged US$2,882/t in Q2 2022 -- up by 20% YoY [lowest: US$2,397/t on 30 Jun’22 and highest: US$3,483/t on 1 Apr’22] LME inventories hit record low at c.0.4 million (down by 76% YoY) European and US premiums remain high to compensate for freight costs and higher gas pr
Slide 8: Alumina Price: 16% of LME Price
Alumina Price: 16% of LME Price [US$465/t] LME Price Trend (US$/t) 3,700 3,267 3,300 2,882 2,900 2,764 2,647 2,399 2,500 2,100 1,700 1,300 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Alumina Price Index Trend (% of LME) 18% 16% 15% 14% 13% 12% 12% 12% 9% 6% 3% 0% Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022
Slide 9: Alba Highlights
02 ALBA HIGHLIGHTS1 1 Alba Highlights relate to Alba official news Page 9
Slide 10: Safety in Numbers
Safety in Numbers # Total Injuries 120 Recordable # 105 Injuries # LTIs 100 80 60 59 60 49 40 34 20 4 5 0 2017 2018 2019 2020 2021 Q1 22 Q2 22 57 32 12 12 11 0 3 6 3 0 1 0 0 0 Highest Ever Achieved in Alba’s History (15 July 2022) Page 10
Slide 11: Major Environment, Social and Governance (ESG) Highlights
Major Environment, Social and Governance (ESG) Highlights Alba lands the Royal Society for the Prevention of Accidents (RoSPA) Gold Medal Award for the ninth consecutive year Alba became the First Company in Bahrain to Refinance its Existing Syndicated Loan of c.US$1.247 Billion tied to Sustainabili
Slide 12: ESG Roadmap For Alba's Race to Net Zero
ESG Roadmap For Alba’s Race to Net Zero Page 12
Slide 13: Alba ESG Actions
Alba ESG Actions Decarbonisation Green Energy Circular Economy Employee Collaboration Transparency, Comms’ & Aluminium & Secondary Alu. Welfare & Partnership & Due Diligence 27 Apr’22 Net Zero Refinancing linked by 2060 to ESG 27 Mar’22 12 Jun’22 Signed MoU with Bahrain Hosting Bahrain 9 Nov’ 21 05
Slide 14: Operational Highlights – H1 2022
Operational Highlights – H1 2022 Sales’ volume topped 742,658 metric tonnes (MT) (almost flat) while Production reached 787,592 MT, up by 1.8% YoY Value Added Sales averaged 67% of the total shipments versus 64% (+70% VAP Sales in Q2 2022) Opened its Sales’ Office in Singapore to strengthen its foot
Slide 15: Financial Key Performance Indicators – Q2 & H1 2022
Financial Key Performance Indicators – Q2 & H1 2022 EBITDA - driven by higher Free Cash Flow1 - impacted LME price & premiums by working capital changes H1: US$874 million up by 127% YoY H1: US$1.046 billion up H1: US$481 million up by by 77% YoY Q2: US$484 million up 923% YoY by 97% YoY Q2: US$554
Slide 16: AL HASSALAH Initiative (2-Year): Save US$100 Million by 2022
AL HASSALAH Initiative (2-Year): Save US$100 Million by 2022 AL HASSALAH (US$ Million) Breakdown by Value Chain (US$ Million) Raw Materials’ Sourcing &Others 100 Power 5 11 90 US$100M 71 47 19 37 Operations Achieved Achieved Cumulative Target 2021 H1 2022 H1 2022* 2022 Sales, Marketing & Casthouse *
Slide 17: Q2 2022 Results
03 Q2 2022 RESULTS Reference: Condensed Consolidated Interim Statement of Financial Position for the Six Months Period Ended 30 June 2022 Page 17
Slide 18: Higher Metal Sales Thanks to Higher LME Prices, VAP & Premiums
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher Metal Sales Thanks to Higher LME Prices, VAP & Premiums Metal Sales’ Bridge (US$M) – Q2 2022 vs. Q2 2021 1,600 1 1,400 3 107 1,200 297 1,000 by 109% YoY 800 in Premiums 1,384 by 20% YoY 600 976 in LME price 400 200 Metal Sal
Slide 19: Higher VAP, Lower Commodities' Volume, Higher Premiums
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher VAP │ Lower Commodities’ Volume │ Higher Premiums Sales by Product-Line Bridge (MT’000) Premium Above LME Trend US$ Per MT Q2 2022 vs. Q2 2021 450 650 400 17 12 5 350 450 +109% 300 388 388 542 250 250 259 200 50 Sales Value
Slide 20: Higher Direct Cost Due to Higher Raw Materials' Cost and Energy Price
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher Direct Cost Due to Higher Raw Materials’ Cost and Energy Price Direct Cost Bridge (US$M) – Q2 2022 vs. Q2 2021 800 6 10 38 7 18 9 700 141 600 764 500 603 400 Direct Cost RM RM Energy Other Alumina Inventory Plant Direct Cost
Slide 21: Higher EBITDA Due to Higher LME Price
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher EBITDA due to Higher LME Price & Partially Impacted by Higher Cost & Selling Expenses │ Strong EBITDA% at 40.0% EBITDA Bridge (US$M) – Q2 2022 vs. Q2 2021 850 8 700 161 EBITDA% - 40.0% 550 408 35 EBITDA% - 35.6% 400 554 250
Slide 22: Cash-Flow Bridge Q1 2022 to Q2 2022 – Sound Cash Position
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Cash-Flow Bridge Q1 2022 to Q2 2022 -- Sound Cash Position Q1 2022 to Q2 2022 Cash-Flow Bridge (US$M) Free Cash Flow (US$M) 900 210 750 326 160 600 530 39 110 450 19 165 336 60 300 51 0 10 150 346 156 -40 0 Q2 2021 Q2 2022 Cash CF
Slide 23: Financial Summary Q2 2022
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Strong Financial Performance due to Higher LME Price & VAP Sales Financial Summary Q2 2022 Q2 2021 H1 2022 H1 2021 Average Cash LME (US$/MT) 2,882 2,399 3,075 2,245 Average Alumina Price (US$/MT) 465 310 448 304 Revenue (US$M) 1,38
Slide 24: Industry Perspectives in 2022
04 INDUSTRY PERSPECTIVES1 IN 2022 1 Industry Perspectives are based on CRU Market Intel Page 24
Slide 25: Aluminium Market Caught Between Lower Demand & Higher Energy Prices
Aluminium Market Caught Between Lower Demand & Higher Energy Prices Aluminium price to move to wait-and-see mode with the economic uncertainties and as recession fears escalate Major economic slowdown is likely to strengthen the US dollar. The US$ strength would be a headwind for commodity prices Th
Slide 26: Major Raw Materials Price Trends
Major Raw Materials Price Trends (Al₂O₃, AlF3, Liquid Pitch and GPC) Alumina prices continue to receive downward pressure owing to the ongoing LME price correction coupled with the refinery expansions around the world primarily in China, India, and Indonesia Liquid Pitch supply to remain tight given
Slide 27: 2022 Alba Priorities
05 2022 ALBA PRIORITIES1 1 Based on Alba 5-Year Strategic Initiatives Page 27
Slide 28: ESG Focus & Journey Towards Safety Excellence
ESG Focus & Journey Towards Safety Excellence Deliver on newly-launched ESG roadmap in line with Bahrain’s Objectives for ‘Net Zero Emissions’ by 2060 Embed ESG in operations and processes as well as deliberate with various stakeholders and partners potential ESG initiatives to further sustainable v
Slide 29: Appendix
06 APPENDIX Reference: Condensed Consolidated Interim Statement of Financial Position for the Six Months Period Ended 30 June 2022 Page 29
Slide 30: Higher Metal Sales – H1 2022 vs. H1 2021
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher Metal Sales Thanks to Higher LME Price, VAP & Premiums Metal Sales’ Bridge (US$M) – H1 2022 vs. H1 2021 2,700 2 188 2 2,200 646 by 110% YoY 1,700 in Premiums 2,594 1,200 by 37% YoY 1,760 in LME price 700 200 Metal Sales LME
Slide 31: Higher VAP, Lower Commodities' Volume, Higher Premiums (H1)
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher VAP │ Lower Commodities’ Volume │ Higher Premiums H1 2022 vs. H1 2021 Premium Above LME Trend US$ Per MT Sales by Product-Line Bridge (MT’000) 800 29 4 26 550 450 600 350 +110% 744 743 250 487 400 150 232 200 50 Sales Value
Slide 32: Higher Direct Cost – H1 2022 vs. H1 2021
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher Direct Cost Due to Higher Raw Materials’ Cost and Energy Price H1 2022 vs. H1 2021 - Direct Cost Bridge (US$M) 1,600 10 139 51 28 1,400 28 15 262 1,200 1,000 1,428 800 1,139 600 400 Direct Cost RM RM Energy Other Alumina Inv
Slide 33: Higher EBITDA – H1 2022 vs. H1 2021
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Higher EBITDA due to Higher LME Price & Partially Impacted by Higher Cost & Higher Selling Expenses │ Strong EBITDA % at 40.3% H1 2022 vs. H1 2021 - EBITDA Bridge (US$M) 1,500 29 1,300 288 EBITDA% - 40.3% 1,100 834 62 900 EBITDA% -
Slide 34: Cash-Flow Bridge FY 2021 to H1 2022
Aluminium Industry: Volatile Market Conditions Push LME Price Higher Cash-Flow Bridge FY 2021 to H1 2022 -- Sound Cash Position FY 2021 to H1 2022 Cash Flow Bridge (US$M) Free Cash Flow (US$M) 1400 1200 600 1000 459 500 73 800 26 400 1,013 600 300 481 347 400 200 200 200 100 47 248 156 0 0 Cash CF W
Slide 35: Alba Shareholder's Structure
Alba Shareholder’s Structure Alba was converted into a Bahrain Public Joint Stock Company on 23 November 2010 Alba shares are listed on two exchanges: Ordinary Shares on Bahrain Bourse and Global Depository Receipts (GDRs) on the London Stock Exchange – Alternative Investment Market Alba Ticker [BHB
Slide 36: Alba Share Price Performance [ALBH, BD]
Alba Share Price Performance [ALBH, BD] 1.800 1.600 1.400 1.155 1.200 1.000 0.800 44% YoY 0.800 0.600 0.400 0.200 0.000 Page 36
Slide 37: For more information, please contact us
For more information, please contact us on: IR@alba.com.bh Alba4World Alba4World user/Alba4World Alba4World Page 37
Aluminium Bahrain B.S.C. (Alba) — Q2 2022 Earnings Presentation on 6ix