Salzgitter Ag · XETR:SZG
Salzgitter — FY2020 Earnings Presentation
39 slides from Salzgitter's earnings presentation, Mar 16, 2021
Slide 1: Analyst Conference Financial Year 2020
Analyst Conference Financial Year 2020 Prof. Dr.-Ing. Heinz Jörg Fuhrmann, Chairman of the Executive Board Burkhard Becker, Chief Financial Officer SZAG Investor Relations Salzgitter, March 16, 2021 english
Slide 2: Agenda
Prof. Dr.-Ing. Heinz Jörg Fuhrmann 1 Key Data / Market Situation 2 Business Units 3 Green Steel SZAG Investor Relations Burkhard Becker 4 Annual Accounts Financial Year 2020 5 Guidance english
Slide 3: 2020 in pictures
Key Data / Market Situation 2020 in pictures Hot-dip Galvanizing Line 3 | Salzgitter Flachstahl Steam electrolysis | Salzgitter Flachstahl Wind-H2 – Sector coupling | Salzgitter Flachstahl Green strip steel New Heat Treatment Line | Ilsenburger Grobblech Expansion of Funding approval for the SALCOS
Slide 4: Key data per 2020/12/31
Key Data / Market Situation Key data per 2020/12/31 FY 2020 FY 2019 Δ Q4 2020 Q3 2020 Q2 2020 Q1 2020 Crude steel production kt 6,033.0 6,613.4 -580.4 1,698.8 1,381.5 1,271.2 1,681.5 External sales1 € million 7,090.8 8,547.3 -1,456.5 1,826.5 1,633.4 1,522.7 2,108.3 Earnings before tax € million -196
Slide 5: Development of steel demand in customer segments and the EU
Key Data / Market Situation Development of steel demand in customer segments and the EU 14% Construction Metal processing / 40% Actual / Forecast steel demand 2020/2021 10% welded tubes 9% 30% Change per quarter 21% 4% 5% 5% 5% 20% 4% 9% 8% 40% 36% 0% 10% -1% 0% 30% -1% -10% -2% -6% -9% -8% -20% -11
Slide 6: Raw materials and steel prices
Key Data / Market Situation Raw materials and steel prices Raw Materials Hot rolled coil & Heavy Plate Iron ore Coking Coal (62% Fe CFR China, US$/dmt) 800 (FOB Australia, US$/t) 750 200 250 (€/t) 164 118 Ø 715 700 175 Ø 657 Ø 168 200 150 Ø 177 600 Ø 556 125 150 Ø 504 Ø 109 Ø 132 500 Ø 124 100 Ø 93
Slide 7: EU steel imports
Key Data / Market Situation EU steel imports Rolled steel imports into the EU-28 (in Tt/month) 2.500 20% 2.000 16% 1.500 12% 1.000 8% 500 4% 0 0% 2014 2016 2017 2018 2019 2020 China Ukraine Russia Turkey India South Korea Iran Brazil Other Market share imports SZAG Investor Relations High level of i
Slide 8: Agenda
Prof. Dr.-Ing. Heinz Jörg Fuhrmann 1 Key Data / Market Situation 2 Business Units 3 Green Steel SZAG Investor Relations Burkhard Becker 4 Annual Accounts Financial Year 2020 5 Guidance english
Slide 9: Strip Steel
Business Units Strip Steel Order intake Consolidated sales Earnings before taxes Special effects: 5,000 2,500 250 2019: € -119.1 m 2020: € +6.2 m 4,500 200 4,318 2,209 4,000 4,239 2,000 150 3,500 1,880 100 3,000 1,500 € million € million kt 2,500 50 2,000 1,000 0 1,500 -42.8 -50 1,000 500 -86.8 -100
Slide 10: Strip Steel – Hot-dip Galvanizing Line
Business Units Strip Steel – Hot-dip Galvanizing Line 3 Increase of hot-dip galvanizing capacity by around 500 kt per year Reinforcement of the market position in the automotive segment Effective utilization of the galvanizing shop due to greater specialization of the lines Compensation of t
Slide 11: Plate / Section Steel
Business Units Plate / Section Steel Order intake Consolidated sales Earnings before taxes Special effects: 2,500 900 50 2019: € -64.9 m 2020: € +9:7 m 800 805 2,000 700 1,958 0 1,873 684 600 1,500 € million € million 500 -94.7 kt -50 400 1,000 300 -124.0 -100 200 500 100 0 0 -150 2019 2020 2019 202
Slide 12: Plate / Section Steel – new Heat Treatment Line
Business Units Plate / Section Steel – new Heat Treatment Line at Ilsenburger Grobblech Investment into a modern and competitive heat treatment line Strengthening of the market position and volume expansion for higher value grade segments such as high strength and wear resistant, water tempered
Slide 13: Mannesmann
Business Units Mannesmann Order intake* Consolidated sales* Earnings before taxes Special effects: 1,600 1,200 20 2019: € -54.1 m 2020: € +4.9 m 1,120 10 1,400 1,384 1,000 0 1,200 947 -10 800 1,000 1,073 -20 € million € million € million 800 600 -30 -41.5 -40 600 400 -50 400 -60 -62.0 200 200 -70 0
Slide 14: Mannesmann – Expansion of precision tubes and stainless tubes groups
Business Units Mannesmann – Expansion of the precision tubes and stainless tubes groups MPT: Expansion of the Mexican plant MST: New cold pilger mill for the Remscheid plant Growth in the NAFTA region Largest cold pilger mill for the production of large seamless Construction of a production li
Slide 15: Trading
Business Units Trading Shipments Consolidated sales Earnings before taxes Special effects: 4,000 3,000 60 2019: € -5.4 m 2020: € -0.9 m 3,796 2,846 50 3,500 2,500 40 3,000 3,176 2,225 30 2,000 2,500 20 € million € million 25.1 kt 2,000 1,500 10 0 1,500 1,000 -10 1,000 -20 500 500 -31,0 -30 0 0 -40 2
Slide 16: Trading – Acquisition of Statendam Steel Plates B.V.
Business Units Trading – Acquisition of Statendam Steel Plates B.V. Extension of the product portfolio of Salzgitter Mannesmann Staalhandel B.V. and Statendam Steel Plates B.V. Extension of the finishing capacities Strengthening of the market position Additional distribution channel for our
Slide 17: Technology
Business Units Technology Order intake Consolidated sales Earnings before taxes Special effects: 1,600 1,600 40 2019: € -1.3 m 2020: € -0.6 m 1,400 1,400 1,374 1,390 32.7 1,200 1,248 1,200 30 1,207 1,000 1,000 € million € million € million 800 800 20 600 600 400 400 10 200 200 0.9 0 0 0 2019 2020 20
Slide 18: Technology – many international projects in realization
Business Units Technology – many international projects in realization Construction start of beer line in Large-scale greenfield project in the US Can line for soft drinks in Nigeria Canada The first cans were produced within Successful start of assemblage Service staff of KHS Nigeria realized
Slide 19: Industrial Participations / Consolidation
Business Units Industrial Participations / Consolidation Consolidated sales Earnings before taxes Special effects: 200 120 2019: € -148.9 m 2019: € -0.3 m 180 100 178 160 80 Contribution Aurubis investment: 140 148 60 2019: € 99.5 m 120 2020: € 104.0 m € million € million 40 100 20 80 20.8 0 60 -20
Slide 20: Agenda
Prof. Dr.-Ing. Heinz Jörg Fuhrmann 1 Key Data / Market Situation 2 Business Units 3 Green Steel SZAG Investor Relations Burkhard Becker 4 Annual Accounts Financial Year 2020 5 Guidance english
Slide 21: Green strip steel
Decarbonization strategy Green strip steel The mapping of all the relevant processes and material flows is required to produce evidence of product-specific CO2 emissions TÜV SÜD developed the VERIsteel procedure based on DIN EN ISO/IEC 17029 and other international standards specifically for thi
Slide 22: Our path towards a low-CO2, hydrogen-based steel production
Decarbonization strategy Our path towards a low-CO2, hydrogen-based steel production We are in control… …and pioneer at the same time CO2- emission allowances acquired as a precaution Shortfall in CO2 allowances has Significant, gradual reduction of been compensated for the most the CO2 emission
Slide 23: SALCOS – Gradual conversion to H2-based steel production
Decarbonization strategy SALCOS® – Gradual conversion to a H2-based steel production For the integrated steel production we are targeting reductions in CO2 emissions of 30 % by 2030 and of 95 % by 2050. SZAG Investor Relations We are ready! Gradual technical implementation possible as soon as the ne
Slide 24: Our path towards a low-CO2, hydrogen-based steel production
Decarbonization strategy Our path towards a low-CO2, hydrogen-based steel production Feasibility study µDRAL – Mikro-Direkt- Iron ore direct reduction plant in Wilhelmshaven ReduktionsAnLage First steam electrolysis on Construction of a MW scale at Salzgitter demonstration plant Flachstahl as from 2
Slide 25: Salzgitter Wind Hydrogen
Decarbonization strategy “Salzgitter Wind Hydrogen” Important building block on the way towards climate-friendly steel production Production of electricity via wind power and electrolytic hydrogen at the plant site Erection of seven wind turbines with an overall output of 30 megawatt Hydrogen
Slide 26: Sectoral comparison of CO2 avoidance costs
Decarbonization strategy Sectoral comparison of CO2 avoidance costs CO2 avoidance costs1) 2030 (Agora) (Assumption: Electricity will be generated completely green) 600 CO2-Vermeidungskosten CO2-avoidance costs 500 untere Bandbreite lower range Euro per ton CO2 400 CO2-Vermeidungskosten CO2-avoidance
Slide 27: Agenda
Prof. Dr.-Ing. Heinz Jörg Fuhrmann 1 Key Data / Market Situation 2 Business Units 3 Green Steel SZAG Investor Relations Burkhard Becker 4 Annual Accounts Financial Year 2020 5 Guidance english
Slide 28: Overview
Annual Accounts Financial Year 2020 Overview Consolidated sales decreased mainly due to lower average selling prices and declining shipment volumes Pre-tax result (€ -196.4 million) exceeds that of the previous year immediate measures and very pleasing contribution of Aurubis AG stabilize earn
Slide 29: Group Result
Annual Accounts Financial Year 2020 Group Result € million 200 100 176.1 0 -295.3 -119.2 -100 -196.4 -273.9 -77.2 -200 -77.5 -300 EBITDA Depr./Amort. EBIT Net interest EBT Taxes EAT SZAG Investor Relations Earnings after taxes includes € 71.0 million in additional tax expenses english 29
Slide 30: Earnings bridge Group
Annual Accounts Financial Year 2020 Earnings bridge Group € million SZAG Investor Relations Corona-induced erosion of margins and volumes drives development of earnings, significant counterbalancing effects from immediate measures english 30
Slide 31: Income statement
Annual Accounts Financial Year 2020 Income statement Income Statement (€ million) FY 2020 FY 2019 Δ Sales 7,090.8 8,547.3 -1,456.5 Increase/decrease in finished goods and work in process/other own -158.1 -8.2 -149.9 work capitalized 6,932.7 8,539.1 -1,606.4 Other operating income 345.3 285.6 59.7 Co
Slide 32: Consolidated balance sheet – assets
Annual Accounts Financial Year 2020 Consolidated balance sheet Assets (€ million) 12/31/2020 12/31/2019 Δ Non-current assets 4,244.5 4,099.0 145.5 Intangible assets, property, plant and equipment 2,423.6 2,343.0 80.6 Investment property 81.5 82.0 -0.5 Financial assets 54.6 64.7 -10.1 Investments acc
Slide 33: Consolidated balance sheet – equity and liabilities
Annual Accounts Financial Year 2020 Consolidated balance sheet Equity and liabilities (€ million) 12/31/2020 12/31/2019 Δ Equity 2,678.9 2,938.6 -259.7 Subscribed capital 161.6 161.6 0.0 Capital reserve 257.0 257.0 0.0 Retained earnings 2,594.5 2,845.1 -250.6 Other reserves 26.4 23.0 3.4 Unappropria
Slide 34: Cash flow statement
Annual Accounts Financial Year 2020 Cash flow statement € million 800 18.3 600 -234.2 14.2 151.0 400 700.5 621.4 200 0 Cash and cash Cash flow Cash flow Cash flow Other Cash and cash equivalents at start from operating from investment from financing equivalents at end of period activities activities
Slide 35: Working capital development
Annual Accounts Financial Year 2020 Working capital development Working capital / lead times to replenish Reconciliation of working capital € million Tage € million 4,000 120 103 106 -178 95 98 2,455 94 -22 -104 3,000 90 -22 -27 -9 2,094 2,000 60 2,515 2,455 2,349 2,094 2,076 1,000 30 2019 2020 Stri
Slide 36: Update programs of measures
Annual Accounts Financial Year 2020 Update programs of measures FitStructure 2.0 (incl. remaining effects of FitStructure) SZAG 2021 Growth Programs € million earnings improvement potential € million additional profit contribution 200 200 180 180 160 ~30 160 140 140 120 120 ~100 ~80 100 100 80 80 60
Slide 37: Agenda
Prof. Dr.-Ing. Heinz Jörg Fuhrmann 1 Key Data / Market Situation 2 Business Units 3 Green Steel SZAG Investor Relations Burkhard Becker 4 Annual Accounts Financial Year 2020 5 Guidance english
Slide 38: Salzgitter Group – Guidance
Guidance Salzgitter Group – Guidance With explicit reference to the still imminent, virtually unquantifiable risk of the Corona pandemic, we anticipate the following for the Salzgitter Group in the financial year 2021: an increase in sales to more than € 8.5 billion, as well as a pre-tax profit
Slide 39: Analyst Conference Financial Year 2020
Analyst Conference Financial Year 2020 Prof. Dr.-Ing. Heinz Jörg Fuhrmann, Chairman of the Executive Board Burkhard Becker, Chief Financial Officer SZAG Investor Relations Salzgitter, March 16, 2021 english