Hindalco Industries Limited · NSE:HINDALCO
Hindalco Industries — Q1 FY12 Earnings Presentation
29 slides from Hindalco Industries's earnings presentation, Aug 14, 2011
Slide 1: Hindalco Industries Ltd Investor Presentation Q1 FY12
Hindalco Industries Ltd Investor Presentation Q1 FY12
Slide 2: Presentation Structure
Presentation Structure Highlights Performance Review Projects Update 2
Slide 3: Highlights – Q1 FY12
Highlights – Q1 FY12 NET SALES 6,031 16% EBITDA 1,045 16% PAT 644 21% EPS 3.4 20% Strong Performance by Novelis Projects progressing Despite strong Cost Push & adversities 3 Momentum continues …
Slide 4: Highlights - Improving Trend…
Highlights - Improving Trend… (EBITDA, ` Cr) 1020 Disruptions at Hirakud 1045 & Dahej 1200 901 1000 780 801 800 600 400 200 0 FY11 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY12 Q1 4
Slide 5: Key Business Drivers and Impact
Key Business Drivers and Impact Driver Change ( %) Impact Aluminium LME 24 Average($/ton) Copper TC/RC 22 Benchmark (c/lb) Exchange (2) Rate (`/$) Coal India 30% Prices Crude derivatives >20% 5
Slide 6: Financial Performance
Financial Performance ` Cr Q1 FY11 Q1 FY12 Change (%) Net Sales 5,178 6,031 16 PBITDA 901 1,045 16 PBT 673 803 19 PAT 534 644 21 EPS (`) 2.8 3.4 20 Other income higher by `109 crs reflecting higher treasury corpus and yield ; and `69 crs dividend from ABML 6
Slide 7: Performance Review
ADITYA BIRLA HINDALCO Performance Review
Slide 8: Al: Supportive LME but ….
Al: Supportive LME but …. $/t LME `/t 2800 1,13,176 1,16,387 120000 2600 1,05,110 110000 2400 97,097 95,481 100000 2200 2000 90000 1800 80000 1600 70000 1400 2096 2089 2343 2500 2603 1200 60000 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11 Q1 FY12 But there were many challenges … Across the board increase in ke
Slide 9: Cost pressures: A Global Phenomenon …
Cost pressures: A Global Phenomenon … 2500 Shifting Global cost curve 2,400 ($/ton of Aluminium) 2,031 Energy 2000 1,693 2,015 1500 1,288 1,650 Carbon 1,328 1000 1,018 Alumina 500 0 (Source: Industry Estimates) 2001 2005 2010 Mid-2011 Average 90th Percentile Upward trend likely to continue for smelt
Slide 10: Aluminium: Production Increase in Hydrate / Alumina sales
Aluminium: Production Increase in Hydrate / Alumina sales with continued focus on specials 59 kt 55 kt Alumina (kt) 69.93 341 335 Specials 37 36 Standard 19 22 Q1 FY11 Q1 FY12 Q1 FY11 Q1 FY12 Aluminium (kt) Export 140 140 Domestic 87.8% 90.4% Maximized domestic sale of metal … 10 Q1 FY11 Q1 FY12 Q1
Slide 11: Aluminium Business: Financial Performance
Aluminium Business: Financial Performance Q1 FY11 Q1 FY12 Change (` cr) (%) Net Sales & 1,867 2,093 12.1 Operating Revenue EBIT 552 599 8.5 Input cost pressures & stronger rupee partly negated the gains of strong LME…. Downstream sales were lower due to sluggish demand and Alupuram lock-out sinc
Slide 12: Novelis Update (Q1 FY12)
Novelis Update (Q1 FY12) Shipments Up 3% to 767 Kilotonnes Net Sales Up 23% to $3.1 Billion Record Adjusted EBITDA Up 16% to $306 Million Free Cash Flow Before CapEx of ($127) Million Liquidity of $865 Million Net Income of $62 Million 12 Record First Quarter Results
Slide 13: Novelis: Adjusted EBITDA Trend
Novelis : Adjusted EBITDA Trend (Millions) $350 $1,150 Quarterly EBITDA TTM EBITDA 306 $300 291 $1,100 280 263 $250 238 $1,050 Quarterly $200 $1,000 TTM $150 $950 $100 $900 $50 $850 $0 $800 Q1FY11 Q2FY11 Q3FY11 Q4FY11 Q1FY12 Driving Consistent & Predictable Results
Slide 14: Copper: Operational Performance
Copper: Operational Performance Copper production down 3kt Cathode Production (kt) • Improved Tc/Rc 76 •Improved operating efficiencies 73 •Higher DAP realisations… ………Resulted in improved financial performance despite…… Q1 FY11 Q1 FY12 …Cost pressures & higher ~20 kt output lost due to shutdown wor
Slide 15: Copper: Financial Performance
Copper: Financial Performance Q1 FY11 Q1 FY12 Change (` cr) (%) Net Sales & 3,314 3,940 18.9 Operating Revenue EBIT 124 145 16.8 15
Slide 16: ABML Update
ABML Update Nifty Sulfide Production declined 24%… … Due to a sharp decline in head grade, which is in line with the mine 18,000 Copper in Conc. (tons) plan 16,000 Copper Grade (%) 14,000 15,665 3.0 3.05 28% 12,000 10,000 11,888 2.20 8,000 6,000 2.0 4,000 2,000 0 1.0 Q1 FY11 Q1 FY12 Q1 FY11 Q1 FY12
Slide 17: Key External Drivers - Outlook
Key External Drivers - Outlook Driver Current Assessment Impact LME • Investor appetite is supportive, but concerns galore INR USD • Uncertainty over FII flows may hold rupee appreciation, despite general USD weakness Energy, • Upward pressure related to coal and carbon costs Input prices TcRc • 201
Slide 18: Projects Update
AT ADITYA BIRLA Projects Update
Slide 19: Greenfield Projects Update
Greenfield Projects Update Expected Project Progress completion • Project finance completed (contracted debt ` 7,875 Cr) Mahan Aluminium, • Drawdown till date: ` 3,400 crs • 17,000 people at site First Metal MP • Forest clearance for coal block ,tapering linkage End 2011 applied • >9,000 people at s
Slide 20: Activity at Project Sites – Mahan Smelter
Mahan Smelter Activity at Project Sites Pot room “A” inside view Cathode Sealing Shop-Eqpts. Cmmnsg. GTC1 ID Fan foundations & Stack : 20 Pot Annexe bldg. and PTMs erection Smelter Overview
Slide 21: Activity at Project Sites – Mahan CPP
Mahan CPP Activity at Project Sites Power House Building CHP Crusher and Stacker Reclaimer Placing of Stator #2 on position Power Plant View 21
Slide 22: Activity at Project Sites – Utkal Refinery
Activity at Project Sites Utkal Refinery Predisilication Area Ball Mill Erection Captive Power Plant Calciner Erection
Slide 23: Update on Projects: Brownfield
Update on Projects: Brownfield Project Scope Expected completion Hirakud expansion Smelter: 155 to 213 ktpa Early 2012 Transfer from Novelis UK plant FRP, Hirakud to produce a wide product End 2011 range including can body stock Significant increase in FRP Pinda (Brazil) End 2012 capacity to 600 ktp
Slide 24: FRP - Hirakud
FRP - Hirakud Cold Mill Base Frame Erection Cold Mill Bay-Crane Erection Hot Mill Bay Hot Mill Table Roll Foundation
Slide 25: Pinda, Brazil Mill Expansion
Pinda, Brazil Mill Expansion
Slide 26: Thank you
Thank you 26
Slide 27: Forward Looking & Cautionary Statement
Forward Looking & Cautionary Statement Certain statements in this report may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the
Slide 28: Aluminium Production
Aluminium Production In Tonnes Q1FY11 Q1FY12 Variance Alumina 341,419 334,587 -2% Metal 140,061 140,387 FRP 51,373 49,544 -4% Extrusions 9,617 7,321 -24% Foil 4,781 4,750 -1% Wire Rods 23,326 23,403
Slide 29: Copper Production
Copper Production Production Units Q1 FY11 Q1 FY12 % chg Copper Cathodes MT 76,309 73,192 -4% CC Rods : Own MT 40,708 33,701 -21% Production lower due to bi-annual shutdown