Slide 1: Second Quarter 2019 Presentation
BEFESA Second Quarter 2019 Presentation 25 July 2019
Slide 2: Disclaimer
BEFESA Disclaimer This presentation contains forward-looking statements and information relating to Befesa and its affiliates that are based on the beliefs of its management, including assumptions, opinions and views of Befesa and its affiliates as well as information cited from third party sources.
Slide 3: Today's Presenters
BEFESA Today’s Presenters CEO since 2000 CFO since 2014 Since 2008 Javier Molina Wolf Lehmann Rafael Pérez CEO CFO; including Director of responsibilities Investor Relations for Operational & Strategy Excellence and IT ▪ Leading the Company ▪ 20+ years in finance and ▪ Director of Investor Relations
Slide 4: Highlights
BEFESA Highlights H1 at €80m EBITDA; down -10%/€-9 YoY as anticipated per guidance & sensitivities: - Lower volume due to Turkey upgrade & Plant maintenance schedule H1>H2 - Unfavourable market prices: $245/t TC; €2,420 Avg. LME Zinc; €1,460 avg. Alu Alloy + Partially offset by higher hedges, recove
Slide 5: Consolidated Key Financials
BEFESA Consolidated Key Financials Q2 EBITDA at €37m (€-7m YoY): Lower volume due to Turkey upgrade & plant maintenance schedule; Unfavourable TC & market prices; Partially offset by higher hedges, recovering Stainless and Alu furnace upgrades Revenue Highlights (€m) ▪ Q2 revenue down 9.1% YoY to €1
Slide 6: Steel Dust Recycling Services
BEFESA Steel Dust Recycling Services Q2 EBITDA at €27.7m, (€-6.0m YoY); driven by lower volume in Turkey, scheduled maintenance & unfavourable TC; partially offset by improved hedges & Stainless Revenue EAF dust throughput & capacity utilisation (€m) (thousand tonnes, % of annual installed capacity)
Slide 7: Aluminium Salt Slags Recycling Services
BEFESA Aluminium Salt Slags Recycling Services H1 EBITDA at €18.7m (~flat YoY) mainly driven by furnace upgrades in 2018 showing results (2nd Aluminium) ~offset by lower aluminium alloy prices Revenue(1) Volumes & capacity utilisation (€m) (thousand tonnes, % of annual installed capacity) 189.2 163.
Slide 8: Consolidated Net Debt / Leverage
Consolidated Net Debt / Leverage BEFESA / Cash Flow / Capital Structure Successfully closed long-term capital structure with 7-year tenor up to 2026 at attractive interest rates; €170 cash and leverage ~stable at x2.2 in Q2’19 Net debt H1’19 EBITDA to total cash flow – main drivers (€m, as of 30 Jun
Slide 9: Zinc Prices & Hedging Strategy
BEFESA Zinc Prices & Hedging Strategy Hedging up to Oct. ´21 improves earnings & cash flows visibility for next ~2.5 yrs € 3,000 Market zinc price vs. zinc hedges (€/tonne) € 2,500 ~€2,310 ~€2,250 €2,168 9M ’21: €2,160 ~€2,200 € 2,000 €2,051 Closed ~half of €1,939 €1,876 Q3 ’21 targeted hedge volume
Slide 10: Mid-Term Growth Roadmap
BEFESA Mid-Term Growth Roadmap Accelerating growth through well defined business plan; Hedging in place and executing top 5 growth projects + China 1 Hedging • 2019: 92.4kt at ~€2,310/t • 2020: 92.4kt at ~€2,250/t • 9M 2021: 56.7kt at ~€2,200/t 2 Organic growth 2019/20 focus – top 5 projects: Indica
Slide 11: Turkey – Plant Upgrade Status
BEFESA 2 Turkey – Plant Upgrade Status Turkey upgrade progressing well … “Cold” commissioning in July; “Hot” & ramp up in August Waelz kiln Settling chambers New Ki Comments • Electric Arc Furnace (EAF) steel dust recycling plant expansion from 65kt to 110kt • To date on time and budget • “Cold” com
Slide 12: Summary
BEFESA Summary Volumes and growth projects as expected … Market prices volatile; Impacting earnings per sensitivity guidance H1 volumes ~stable in both core businesses normalizing for Turkey plant upgrade; Expecting higher volumes in H2 due to Turkey ramping back up in August and fewer plant mainten
Slide 13: Investor Agenda
BEFESA Investor Agenda Financial Calendar Meet Befesa … ✓ Wednesday, 19 June 2019: ✓ 14 May 2019 – Midcap Partners Annual General Meeting in Luxembourg Paris, Annual Small & Midcap Conference ✓ 21-23 May 2019 – Berenberg New York, US Conference 2019 ✓ Thursday, 25 July 2019: ✓ 28 May 2019 – Mainfirs