Slide 1: Recapitalisation Proposal August 2009
LIMITED For personal use only RECAPITALISATION PROPOSAL AUGUST 2009
Slide 2: Important Information and Disclaimer
IMPORTANT INFORMATION AND DISCLAIMER For personal use only Capral Limited Investor presentation - Important notice and disclaimer rider BACKGROUND No party other than Capral Limited has authorised or caused the issue of this document, or takes responsibility for, or makes any statements, representat
Slide 3: Important Information and Disclaimer
IMPORTANT INFORMATION AND DISCLAIMER For personal use only Capral Limited Investor presentation - Important notice and disclaimer rider IMPORTANT INFORMATION This document is not a prospectus under the Corporations Act 2001 (Cth) and has not been lodged with the Australian Securities and Investment
Slide 4: Capral Investment Highlights
CAPRAL INVESTMENT HIGHLIGHTS For personal use only 1 AUSTRALIA’S LARGEST AND LEADING MANUFACTURER AND DISTRIBUTOR OF ALUMINIUM PRODUCTS • National footprint • 34% market share • Skewed towards residential windows and doors market 2 CAPRAL IS BEING TRANSFORMED • New leadership team - relevant industr
Slide 5: Capral has a national footprint of world class extrusion plants
CAPRAL HAS A NATIONAL FOOTPRINT OF WORLD CLASS EXTRUSION PLANTS For personal use only Plant utilisation is expected to recover in 2010 EXTRUSION PLANT UTILISATION Operational capability % Capral operates in all states and employs around 1,000 people EXTRUSION PLANTS FINISHING Location Presses Bremer
Slide 6: Past Operating Performance
PAST OPERATING PERFORMANCE For personal use only Capral’s financial performance has been poor for a number of reasons: • Low priced Chinese imports have captured a significant share of the market in the last decade • Construction of Capral’s aluminium extrusion and distribution facility at Bremer Pa
Slide 7: What Has Changed?
WHAT HAS CHANGED? For personal use only • Phil Jobe appointed CEO in April 2009 • Ian Timmis appointed CFO in June 2009 • Capral orderbook is showing early signs of recovery. Residential construction is forecast to improve followed by the commercial sector • Efficiency and cost cutting initiatives h
Slide 8: Australian building activity correlates with the aluminium extrusion market
AUSTRALIAN BUILDING ACTIVITY CORRELATES WITH THE ALUMINIUM EXTRUSION MARKET For personal use only • Significant growth in Australian aluminium usage over the last 30 years average - 9% p.a. • Capral’s volumes have remained relatively stable over the last few years • Imports have largely captured mar
Slide 9: Australia is currently underbuilding compared to underlying demand
AUSTRALIA IS CURRENTLY UNDERBUILDING COMPARED TO UNDERLYING DEMAND BY 20% AND IN NSW IT IS CLOSER TO 40% For personal use only • Australia has experienced depressed building activity levels (particularly NSW) prior to the onset of the global financial crisis • The current situation reflects a chroni
Slide 10: Capral Sales Volume History
CAPRAL SALES VOLUME HISTORY For personal use only • Capral experienced an unprecedented drop in volumes in the latter part of 2008 • Weak market conditions have persisted into the 1st half of 2009 CAPRAL - DAILY AVERAGE SALES (TONNES) 2006-09 Orders have started to recover because; • Residential mar
Slide 11: Efficiency and cost cutting initiatives have reduced the fixed cost base
EFFICIENCY AND COST CUTTING INITIATIVES HAVE SIGNIFICANTLY REDUCED THE FIXED COST BASE OF THE BUSINESS, LOWERING THE BREAK EVEN POINT For personal use only THE EBITDA BREAK EVEN OF THE BUSINESS HAS REDUCED TONNES PER DAY Cost down achieved Key Initiatives (annualised) $m Regional warehouse rationali
Slide 12: The Business is Being Reshaped
THE BUSINESS IS BEING RESHAPED For personal use only 1. The Business has been reorganised into 2 major streams: EXTRUSION DISTRIBUTION Manufacturing Warehousing & Direct & Indirect Sales sales Major Trade Building Mill Sales Customers Centres System Group Customers Customers Customers Advantages: Cl
Slide 13: Success in the anti-dumping action has the potential to lift Capral volumes
SUCCESS IN THE ANTI-DUMPING ACTION HAS THE POTENTIAL TO LIFT CAPRAL VOLUMES For personal use only Background • The Australian aluminium extrusion industry has suffered material injury from the effects of price undercutting from Chinese extrusion imports. Capral believes that this pricing reflects du
Slide 14: EBITDA is Expected to Increase in 2010
EBITDA IS EXPECTED TO INCREASE IN 2010 For personal use only 2009 VOLUME MARGIN/ RESTRUCT- 2010 PROJECTED CONTRIBUTION EFFICIENCY URING & COST PROJECTED EBITDA (MARKET RECOVERY) DOWNS EBITDA 14 COMMERCIAL-IN-CONFIDENCE
Slide 15: The Recapitalisation Proposal
THE RECAPITALISATION PROPOSAL For personal use only • RECONSTRUCTED CAPITAL Prior to settlement of the Placement, Capral will consolidate existing ordinary shares on a 10:1 basis • REPAIRED BALANCE SHEET Prior to settlement of the Placement, Capral will convert $66m of debt to equity • GPG SHAREHOLD
Slide 16: Consolidated Capital and Repaired Balance Sheet
CONSOLIDATED CAPITAL AND REPAIRED BALANCE SHEET For personal use only • Consolidated capital Existing 389m shares consolidated on a 1:10 basis to approx 39m shares • Repaired balance sheet - Capral to acquire outstanding $53m (at face value, including accrued and unpaid interest) of convertible note
Slide 17: Indicative Timetable (Subject to Change)
INDICATIVE TIMETABLE (SUBJECT TO CHANGE) For personal use only Date Event Friday 28 August 2009 Announcement of Recapitalisation Program/ Placement and Half Year 2009 Results Wednesday 9 September 2009 EGM documents mailed to Shareholders Tuesday 15 September 2009 Bidder’s Statement, Target’s Statem
Slide 18: Appendix: Company history
APPENDIX For personal use only Year Event 1936 Alcan Australia established 1986 Listed on ASX 1994 Alcan Aluminium Ltd of Canada sells its entire 73.3% shareholding in Alcan Australia 1995 Acquisition of Comalco’s Australian extrusion and distribution businesses 2000 Sale of Kurri Kurri, NSW, smelte