Apl Apollo Tubes Limited · NSE:APLAPOLLO
Apl Apollo Tubes — Q3 FY2020 Earnings Presentation
31 slides from Apl Apollo Tubes's earnings presentation, Jul 1, 2020
Slide 1: APL Apollo Q3 FY20 Results
APL APOLLO Q3 FY20 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 Year till date 9MFY’20 APL Apollo Overview Financial Performance Core Competence Key Takeaways Annexure 3
Slide 4: Year Till Date 9M FY'20
YEAR TILL DATE 9M FY’20
Slide 5: Q3 FY'20 at a Glance
Q3 FY’20 at a Glance 4.8 lac ton 40% ₹ 1,652 Mn ₹ 742 Mn* Market share in structural steel EBITDA Net profit Volume tube sector as at 30 Sept’ 19 164% yoy increase 475% yoy increase 52% yoy increase FY19 was 36% 25.5 lac ton 20.7% 1,100+ ₹ 3,440 ROCE as at 31 Dec’ 19 Products EBITDA/ ton Capacity as
Slide 6: Q3 FY'20 Highlights
Q3 FY’20 Highlights Slight Margin recovery Strong balance improvement in sheet Better capacity utilization demand levels led to operating Debt of APL Apollo leverage gains (excluding Apollo Tricoat) Evident from our sales declined by Rs1.1bn to Rs7bn volume growth Focus on increased sale of in 9MFY2
Slide 7: 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 2,079 Employees 790+ Distributors 1,100+ Products 7
Slide 8: 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 Build Galvanized structural steel
Slide 9: Brand Equity
Brand Equity oe & ISHED a: cae — CHEN! _¥ a VS orm «e i}? xi z S59 “KERAL
Slide 10: Brand Equity
Brand Equity 4 APL BADATI HAL HIMMAT ANDAR KI TAQAT SE | HARYANA STEELERS}
Slide 11: B2C Channel
B2C Channel Distributors 790+ Distributors – Solid Relationships, Incentive plans Retailers 50,000+ Retailers – Retailer bonding program Fabricators 100,000+ Fabricators – Apollo Connect Bonding Programs, Fabricator meets to promote APL Apollo Brand End Consumer End Customer Connect– Indian Premier
Slide 12: Financial Performance
FINANCIAL PERFORMANCE Girous
Slide 13: Growing Strength to Strength
Growing Strength to Strength Volume (000’s Ton) PAT (Rsm) 480 742 418 617 389 364 551 315 518 129 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 EBITDA (Rsm) EBITDA/Ton (Rs) 1,652 3,384 3,335 3,440 1,416 1,295 1,985 2,104 766 625 13 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Q3
Slide 14: Growing Strength to Strength
Growing Strength to Strength Operating Cash flow (Rsm) Debt to EBITDA (x) 2.6 3,576 3,384 3,148 2.2 2.1 2.0 1.8 1.7 2,211 914 113 FY 15 FY 16 FY 17 FY 18 FY 19 9MFY20 FY 15 FY 16 FY 17 FY 18 FY 19 9MFY20 Debt to Equity (x) Net debt (Rsm) 1.2 8,103 8,081 7,683 1.0 0.9 6,492 0.9 5,957 0.8 0.6 4,630 14
Slide 15: Growing Strength to Strength
Growing Strength to Strength ROCE (%) ROE (%) 23.0 24.0 20.2 21.1 22.6 22.3 19.4 20.1 20.7 16.3 17.7 14.2 FY 15 FY 16 FY 17 FY 18 FY 19 9MFY20 FY 15 FY 16 FY 17 FY 18 FY 19 9MFY20 Interest Coverage Ratio (x) Net Working Capital Days 4.7 4.7 4.5 46 4.2 43 40 3.6 36 34 2.8 28 15 FY 15 FY 16 FY 17 FY 1
Slide 16: Growing Strength to Strength
Growing Strength to Strength Particulars FY15 FY16 FY17 FY18 FY19 9MFY20 Particulars FY18 FY19 9MFY20 Apollo Structural Apollo Structural DFT (Part of Apollo Structural) Volume (000’s tons) 249 426 475 614 766 682 Volume (000’s tons) 153 321 267 Revenue (Rsm) 10,541 14,744 17,971 26,380 37,469 28,59
Slide 17: Consolidated Financial Performance
Consolidated Financial Performance P&L (Rsm) Q3FY20 Q3FY19 9MFY20 9MFY19 FY19 Sales Volume (000s Ton) 480 314 1,233 921 1,339 Revenue 21,205 16,944 58,486 50,671 71,640 EBITDA 1,652 624 3,713 2,630 4,045 EBITDA/Ton 3,440 1,981 3,012 2,851 3,020 Depreciation 262 157 704 470 643 Interest 281 271 832 8
Slide 18: Financial Performance (Excluding Apollo Tricoat)
Financial Performance (Excluding Apollo Tricoat) P&L (Rsm) Q3FY20 Q3FY19 9MFY20 9MFY19 FY19 Sales Volume (000s Ton) 433 314 1,158 921 1,339 Revenue 18,915 16,944 54,538 50,671 71,640 EBITDA 1,367 624 3,259 2,630 4,045 EBITDA/Ton 3,157 1,981 2,814 2,851 3,020 Depreciation 235 157 653 470 642 Interest
Slide 19: EBITDA Growth QoQ (Excluding Apollo Tricoat)
EBITDA Growth QoQ (Excluding Apollo Tricoat) ₹ 1,367m ₹ 3,157/ton Incremental sales volume of 96,612 ton Operating leverage gains ₹ 609m EBITDA Better product mix with increased sale of ₹ 1,808/ton Apollo Z and Apollo Build products Better demand scenario after dull Q2FY20 Q2FY20 Q3FY20 19
Slide 20: Core Competence
CORE COMPETENCE Girous
Slide 21: Our Business Moat
Our Business Moat... Most products Lowest cost producer with 1,100 SKUs (largest buyer of HR coil) Highest scale with 11 plants Highest Premium pricing to peers Profitability (2.5Mn ton capacity) (brand strength) Largest sales network Technology edge & (790+ distributors) Innovation 21
Slide 22: Dominant Leadership
Dominant Leadership Peer Market Share FY19 APL’s Market Share (%) 40 36 32 29 28 APL Apollo 32% 40% Player 2 Player 3 Player 4 7% Others 9% FY 16 FY 17 FY 18 FY 19 1H FY20 12% Number of Plants 11 Capacity (Mn Tons) 10 2.5 2.1 7 7 1.8 6 1.3 1.3 FY 16 FY 17 FY 18 FY 19 9MFY20 FY 16 FY 17 FY 18 FY 19 9
Slide 23: Unique Capabilities
Unique Capabilities Developed structural Distribution Innovative steel Technology products network market in India First Mover advantage Direct Forming Technology Ground breaking for big structural products solutions No.1 Leader; Focused on B2C channel for last Roofing solutions, steel strength and
Slide 24: Key Takeaways
KEY TAKEAWAYS Girous
Slide 25: Financial Priorities under Strong Governance
Financial Priorities under Strong Governance Growth Earnings •Profitable Organic Growth •Drive sustainable EPS growth •EPS accretive strategic acquisitions •Attain earnings objectives across •Commitment to R&D and Talent economic cycles •ROCE ≥ 25% Capital Allocation •Focus on Free Cash Flow Generat
Slide 26: Solid Future Outlook
Solid Future Outlook Sufficient capacity for 20% annual sales volume growth Three focus areas: Cash flows and profitability Growth in exports and OEM led by DFT technology based products • Improving EBITDA/ton • Improving free cash flows • ROCE enhancement Solidifying APL Apollo brand Launch high-ma
Slide 27: 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 28: Solid Management
Solid Management Directors (Non Executive) Executive Team Neeru Abrol Sanjay Gupta Arun Agrawal 26 Yr experience in SAIL | Director at TCNS Clothing Co Chairman & Managing Director Chief Operating Officer Limited & others|Awarded best achiever by ICAI Abhilash Lal Vinay Gupta Deepak Goyal 3 decades
Slide 29: Annexure
ANNEXURE
Slide 30: Detailed P&L Statement (without Apollo Tricoat)
Detailed P&L Statement (without Apollo Tricoat) Y-o-Y Y-o-Y Particulars (Rsm) Q3 FY20 Q3 FY19 9MFY20 9MFY19 Chg (%) Chg (%) Net Sales 18,869 16,912 11 54,404 50,582 7 Total Income From Operations (Net) 18,869 16,912 54,404 50,582 Other Income 46 32 43 135 89 51 Total Income 18,915 16,944 11 54,538 5
Slide 31: Thank You
Thank You For further information, please contact: Deepak Goyal/Anubhav Gupta Anoop Poojari APL Apollo Tubes Ltd CDR India Tel: +91 120 404 1400/ 1452 Tel: +91 9833090434 Email: deepakgoyal@aplapollo.com Email: anoop@cdr-india.com 31 anubhav@aplapollo.com