Apl Apollo Tubes Limited · NSE:APLAPOLLO
Apl Apollo Tubes — Q1 FY2021 Earnings Presentation
30 slides from Apl Apollo Tubes's earnings presentation, Sep 1, 2020
Slide 1: APL Apollo Q1 FY21 Results
APL APOLLO Q1 FY21 Results 1
Slide 2: Safe Harbour
Safe Harbour Except for the historical information contained herein, statements in this presentation and the subsequent discussions, which include words or phrases such as "will", "aim", "will likely result", "would", "believe", "may", "expect", "will continue", "anticipate", "estimate", "intend", "
Slide 3: Contents
Contents Q1 FY’21 at a glance Covid-19 Action Plans Porter’s 5 Forces Financial Performance Core Competence Key Takeaways ESG Initiatives 3
Slide 4: Q1 FY'21 at a Glance
Q1 FY’21 at a Glance 238k ton ₹ 11.1 Bn ₹ 759 Mn ₹ 3,187 Sales Volume Revenue EBITDA EBITDA/ ton 39% yoy decline 46% yoy decline 41% yoy decline 4% yoy decline ₹ 212 Mn ₹ 168 Mn ₹ 5.1 Bn ₹ 3.5 Bn Interest Cost Net profit Op. Cash flow Net Debt 25% yoy decline 68% yoy decline FY20 was ₹5.1 Bn FY20 wa
Slide 5: Q1 FY'20 Highlights
Q1 FY’20 Highlights Resilience Emerged Stronger Future Ready • Resumed operations in a • Significant improvement in • Market Share gains visible phased manner post 22 cash conversion supported beyond 40% in Structural April 2020 after assessing by actions on working capital Steel Tubing industry the
Slide 6: APL Apollo at a Glance
APL Apollo at a Glance 1 Leading building material structural steel brand Core Business 14 Five Product Categories Brands 40% Market Share 2.5 Million Ton Structural Steel Capacity 8 Patents 10 Plants 2,124 Employees 800+ Distributors 1,500+ Products 6
Slide 7: Product Category
Our Brands Apollo Structural Structural steel construction material: Residential, Commercial, Infrastructure Fabritech, Build, DFT Product Category* Apollo Z Galvanized structural steel construction material: CoastGuard Residential, Commercial, Infrastructure Apollo Galv Galvanized steel tubes: Resi
Slide 8: Product Category – Application & Sales Mix
Product Category – Application & Sales Mix Product Category Sales Volume Mix (%) Applications Apollo Structural 47% Residential Buildings & Independent Homes 16% Structural, Piling, Sheds, Handrails, Gates, Fencing, Commercial Buildings, Warehouses & Factories 8% Balcony Grills, Staircase, Light Str
Slide 9: COVID-19 Action Plan
COVID-19 ACTION PLAN Givrous
Slide 10: Covid-19 Action Plan
Covid-19 Action Plan Business Financials Revenue loss - Complete shutdown from 24 March Cash - Focus on receivable collections and debt reduction during lockdown - Raipur Plant started on 22 April Preservation - Debtors spread across 800+ distributors - Improvement in cash conversion cycle - Delayed
Slide 11: Porter's 5 Forces
PORTER'S 0 FORCES Givrous
Slide 12: Porter's Five Forces
Porter’s Threat of Entry - Scale of 2.5m ton capacity; wide gap between No. 2 Player Five Forces Bargaining power of distributors - Vast distribution network (access to 800+ distributors, 50,000 retailers, 2lacs fabricators) - 40% market share in structural steel - Technology advantage (DFT, ILG) tu
Slide 13: Financial Performance
FINANCIAL PERFORMANCE Girous
Slide 14: Growing Strength to Strength
Growing Strength to Strength Volume ('000 tons) EBITDA (Rsm) 480 1,652 389 401 1,295 1,282 364 238 766 759 Q1 FY 20 Q2 FY 20 Q3 FY 20 Q4 FY 20 Q1 FY 21 Q1 FY 20 Q2 FY 20 Q3 FY 20 Q4 FY 20 Q1 FY 21 EBITDA/Ton (Rs) Net Profit (Rsm) 743 3,334 3,440 3,200 3,187 547 568 521 2,104 168 Q1 FY 20 Q2 FY 20 Q3
Slide 15: Growing Strength to Strength
Growing Strength to Strength Operating Cash flow (Rs Bn) Debt/ EBITDA (x) 2.2 5.1 5.1 2.0 2.0 1.8 1.6 3.6 3.2 1.2 0.9 0.1 FY 16 FY 17 FY 18 FY 19 FY 20 Q1 FY 21 FY 16 FY 17 FY 18 FY 19 FY 20 Q1 FY 21 Debt/ Equity (x) Net Debt (Rs Bn) 1.1 8.1 7.8 7.7 0.9 0.9 6.5 0.8 5.9 0.6 3.5 0.3 FY 16 FY 17 FY 18
Slide 16: Growing Strength to Strength
Growing Strength to Strength4 ROCE (%) ROE (%) 23.1 24.0 19.4 20.3 20.5 22.6 22.3 20.1 20.6 16.5 17.7 14.2 FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 Interest Coverage (x) Net Working Capital (Days) 47 4.0 4.0 40 3.7 3.8 34 3.0 28 2.5 20 10 FY 16 FY 17 FY 18 FY 19 FY 20
Slide 17: Growing Strength to Strength
Growing Strength to Strength Particulars Q1 FY 20 Q2 FY 20 Q3 FY 20 Q4 FY 20 FY 20 Q1 FY21 Apollo Structural Volume (k tons) 128 131 156 98 513 71 Revenue (Rsm) 5,915 5,322 6,119 3,995 21,351 2,880 EBITDA (Rsm) 284 133 345 169 932 116 Apollo Structural (DFT) Volume (k tons) 91 76 99 90 357 41 Revenu
Slide 18: Profit & Loss Statement (Consolidated)
Profit & Loss Statement (Consolidated) Particulars (Rsm) Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 FY 20 Q1 FY21 Change yoy(%) Sales Volume (k Ton) 389 364 480 401 1,633 238 -39 Net Revenue 20,716 16,473 21,159 18,885 77,232 11,098 -46 Other Income 46 46 47 83 222 49 7 Total Revenue 20,762 16,519 21,205 18,96
Slide 19: Balance Sheet & Cash Flow Statement (Consolidated)
Balance Sheet & Cash Flow Statement(Consolidated) Balance Sheet - Assets (Rsm) Q1 FY21 FY20 Cash Flow Statement (Rsm) Q1 FY21 FY20 Cash & Bank Balance 3,104 456 EBITDA 759 4,995 Receivables 1,240 4,764 Accounts receivables 3,533 847 Inventories 6,592 7,842 Inventory 1,249 284 Other current assets 83
Slide 20: Consolidated Cash Flow Bridge (Rsm)
Consolidated Cash Flow Bridge (Rsm) 5,119 6,820 7,841 6,763 219 148 454 3,544 Net Debt 31-Mar-20 Operating cash flow Investment Capex Interest Net Debt 30-Jun-20 The business continues to Organic capex and acquisitions Net debt declined despite high generate strong increased capacity capex spends an
Slide 21: Profit & Loss Statement (Without Tricoat)
Profit & Loss Statement (Without Tricoat) Particulars (Rsm) Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 FY 20 Q1 FY21 Change yoy (%) Sales Volume (k Ton) 389 336 433 363 1,521 206 -47 Net Revenue 20,599 14,936 18,869 16,625 71,028 9,388 -54 Other Income 45 43 46 78 212 46 1 Total Revenue 20,644 14,980 18,915 16
Slide 22: Core Competence
CORE COMPETENCE G@irous
Slide 23: Our Business Moat...
Our Business Moat... Most products Lowest cost producer with 1,500 SKUs (largest buyer of HR coil) Highest scale with 10 plants Highest Premium pricing to peers Profitability (2.5Mn ton capacity) (brand strength) Largest sales network Technology edge & (800 distributors) Innovation 23
Slide 24: Dominant Leadership
Dominant Leadership Peer Market Share FY20 APL’s Market Share (%) 40 37 31 APL Apollo 27 27 32% 40% Player 2 Player 3 Player 4 7% Others 9% 12% FY 16 FY 17 FY 18 FY 19 FY20 Number of Plants Capacity (Mn Tons) 11 2.5 10 2.1 1.8 7 7 6 1.3 1.3 FY 16 FY 17 FY 18 FY 19 FY20 FY 16 FY 17 FY 18 FY 19 FY20 2
Slide 25: Key Takeaways
KEY TAKEAWAYS Girous
Slide 26: Financial Priorities under Strong Governance
Financial Priorities under Strong Governance Growth Earnings • Profitable Organic Growth • Drive sustainable EPS growth • Commitment to R&D and Talent • Attain earnings objectives across • Innovate products to replace economic cycles conventional construction methods • ROCE ≥ 25% Capital Allocation
Slide 27: Solid Future Outlook
Solid Future Outlook Sufficient capacity for double digit annual sales volume growth in long term Three focus areas: Cash flows and Growth in High Diameter and High profitability Thickness Tubes led by DFT • Improving EBITDA/ton technology based products • Improving free cash flows • ROCE enhancemen
Slide 28: ESG Initiatives
ESG Initiatives Environment Social Governance Mapping energy consumption trends to Committed to impart skill No pledge of promoter shares achieve energy optimisation development and employment benchmark Deloitte for statutory audit and Ernst Recruitment of rural youth for local & Young for
Slide 29: Strong Management
Strong Management Directors (Non Executive) Executive Team Neeru Abrol Sanjay Gupta Arun Agrawal Director at TCNS Clothing Co Limited & others|Awarded Chairman & Managing Director Chief Operating Officer best achiever by ICAI | 26 Yr experience in SAIL Abhilash Lal Vinay Gupta Deepak Goyal 3 decades
Slide 30: Thank You
Thank You For further information, please contact: Deepak Goyal Anubhav Gupta Tel: +91 120 404 1400 Tel: +91 120 404 1452 Email: deepakgoyal@aplapollo.com Email: anubhav@aplapollo.com 30