Cognor Holding Sa · GPW:COG
Cognor Holding Sa — Złomrex — Q3 2007 Earnings Presentation
27 slides from Cognor Holding Sa's earnings presentation, Dec 5, 2007
Slide 1: Q3 2007 Business and Financial Performance
ZŁOMREX S.A. Q3 2007 Business and Financial Performance 5 December 2007
Slide 2: Content
Content 1. Introduction 2. Business overview 3. Financials 4. Q4 2007 outlook 5. Q&A Appendix: 1. Q1-Q3 2007 indebtednes; 2. Liguidity breakdown as of 30.11.2007 2
Slide 3: Introduction
ZŁOMREX S.A. Introduction Section 1
Slide 4: Speakers
Introduction Speakers [To come] Krzysztof Krzysztof Dominik Walarowski Zola Barszcz Member of the CFO Chief Board Accountant Age – 51 Age – 35 Age - 31 4 yrs with 6 yrs with 7 yrs with Złomrex Złomrex Złomrex 4
Slide 5: Q3 2007 Highlights
Introduction Q3 2007 Highlights August 3, 2007 - execution of a share purchase agreement with Croatian Privatization Fund on acquisition of śeljezara Split. September 1, 2007 - Contribution of scrap operations into ZLOMREX METAL, a 100% owned subsidiary. October 1, 2007 - Purchase of STALEXPORT (for
Slide 6: Q3 2007 Highlights
Introduction Q3 2007 Highlights Bad market conditions with falling prices and weaker offtake in the whole of Q3. No consumption growth in Poland in comparison to Q3 2006; in July and August 2007 average steel consumption lower by 16,4% than an average for Q2 2007. GDP growth over 5% in Poland and 2
Slide 7: Q3 2007 Highlights
Introduction Q3 2007 Highlights LTM LTM PRFORMA ('000 PLN) 3Q 2007 3Q 2006 3Q 2007 3Q 2007 Revenues 951 215 561 192 3 046 000 3 750 662 Cost of sales -836 703 -475 693 -2 646 230 -3 251 378 Gross profit 114 512 85 499 399 770 499 284 EBIT 36 796 54 963 178 597 199 140 Depreciation/amortization -14 7
Slide 8: Business overview
ZŁOMREX S.A. Business overview Section 2
Slide 9: Business environment
Business overview Business environment (million tons) Q3 2006 Q3 2007 % YoY Q2 2007 Q3 2007 % Chg Production of Steel Global 310,7 330,3 6% 332,6 330,3 -1% Europe (EU 27) 50,1 49,8 -1% 54,4 49,8 -8% Poland 2,7 2,6 -2% 2,8 2,6 -9% (million tons) Jul-06 Aug-06 Sep-06 Q3 2006 Jul-07 Aug-07 Sep-07 Q3 20
Slide 10: Business environment
Business overview Business environment (million tons) Q3 2006 Q3 2007 % YoY Q2 2007 Q3 2007 % Chg Unit prices Scrap 763 763 0% 807 763 -5% Billets 1 489 1 644 9% 1 678 1 644 -2% Bars 2 009 1 977 -2% 2 144 1 977 -8% 10
Slide 11: Q2 2007 performance drivers
Business overview Q2 2007 performance drivers Q3 2006 2006 Acquisitions contribution CONSOLI ZLOMREX Cen (‘000 tonnes) DATED HISTORICAL HSW-HSJ Cen Gor Cen Gd Opo Scrap purchases 215 154 60 0 0 0 Billets 60 56 3 0 0 0 Finished products 149 52 38 40 13 7 Q2 2007 2006 and 2007 Acquisitions contributio
Slide 12: Q3 2007 performance drivers
Business overview Q3 2007 performance drivers Q3 2006 2006 ACQUISITIONS’CONTRIBUTION CONSOLIDA ZLOMREX HSW- Cen (‘m PLN) TED HISTORICAL HSJ Cen Gor Cen Gdansk Opole SALES 561 192 308 996 154 374 48 261 31 355 18 206 EBITDA 64 007 38 508 20 442 2 558 1 633 866 NET PROFIT 44 053 25 824 14 471 1 874 91
Slide 13: Production and sales
Business overview Production and sales 3 Q 2007 3 Q 2006 % YoY SCRAP sales to external customers volume (‘000 tons) 47 59 -20% value ('000 PLN) 35 056 50 017 -30% Intercompany sales and processing volume (‘000 tons) 180 161 12% TOTAL TURNOVER (‘000 tons) 252 215 3% 3 Q 2007 3 Q 2006 % YoY SEMI FINIS
Slide 14: Production and sales
Business overview Production and sales 3 Q 2007 3 Q 2006 % YoY FINISHED PRODUCTS production volume (‘000 tons) 94 108 -13% bulk product sales volume (‘000 tons) 130 90 44% value (‘000,000 PLN) 357 218 64% retail volume (‘000 tons) 131 36 264% value ('000 PLN) 376 97 288% TOTAL (‘000 tons) 261 126 10
Slide 15: Financials
ZŁOMREX S.A. Financials Section 3
Slide 16: Q3 2007 P&L account
Financials Q3 2007 P&L account ZŁOMREX ZŁOMREX ZŁOMREX VASTH ACTUAL ACTUAL HISTORICAL ACTUAL In PLN thousand Q3 2006 Q3 2007 % Q3 2007 % Q3 2007 Revenue 561 192 951 215 69% 562 694 0% 388 521 Cost of sales -475 693 -836 703 -488 128 -348 575 Gross profit 85 499 114 512 34% 74 566 -13% 39 946 Other i
Slide 17: Q3 2007 P&L account
Financials Q3 2007 P&L account ‘000 PLN Q3 2007 Q3 2006 External Sales steel scrap 35 056 50 017 billets 83 113 91 452 finished products 733 710 314 450 other 99 350 105 273 Total net sales 951 229 561192 Gross profit steel scrap 3 031 billets 22 470 finished products 85 478 other 3 533 Total gross
Slide 18: Q3 2007 Balance Sheet
Financials Q3 2007 Balance Sheet ‘000 PLN Q3 2007 Q3 2006 Inventories 649 775 255 780 Trade and other receivables 513 341 329 361 Cash 144 534 27 576 Total current assets 1 313 638 624 067 Trade and other payables 453 072 271 577 Interest bearing debt long term 754 755 142 793 short term 247 288 278
Slide 19: Q3 2007 Key Metrics
Financials Q3 2007 Key Metrics ‘000 PLN where applicable Q3 2007 LTM SALES 3 046 000 LTM COGS -2 646 230 LTM EBITDA 227 326 LTM EBITDA margin 7,5% LTM financing costs -24 596 LTM net result 99 755 Interest coverage 9,2 Net debt to EBITDA 3,8 Liquidity ratio 1,8 inventories turnover 90 Receivables tu
Slide 20: Q3 2007 Proforma Key Metrics
Financials Q3 2007 Proforma Key Metrics ‘000 PLN where applicable Q3 2007 LTM Proforma SALES 3 750 622 LTM Proforma COGS -3 251 378 LTM Proforma EBITDA 253 097 LTM Proforma EBITDA margin 6,7% LTM Proforma financing costs -30 389 LTM Proforma net result 117 415 Interest coverage 8,3 Net debt to EBITD
Slide 21: Q3 2007 v. Q2 2007 Balance Sheet Data
Financials Q3 2007 v. Q2 2007 Balance Sheet Data ‘000 PLN Q3 2007 Q2 2007 change Non current assets 818 474 814 971 3 503 Inventories 649 775 692 918 -43 143 Trade and other receivables 513 341 543 026 -29 685 Cash 144 534 147 922 -3 388 Total current assets 1 313 638 1 387 399 -73 761 Trade and oth
Slide 22: Liquidity as of November 30, 2007
Financials Liquidity as of November 30, 2007 Liquidity table: – includes STALEXPORT and proforma ZELJEZARA SPLIT; – excludes: (i) VASTH put/call option and deffered payment (ii) leasing agreements. ‘000 PLN Nov-07 Cash on balance sheet 95 402 Available lines 131 540 Indebtedness 1 159 711 Indebtedne
Slide 23: Q4 2007 Outlook
ZŁOMREX S.A. Q2 2007 Outlook Section 4
Slide 24: Q4 2007 outlook
Q3 2007 outlook GDP dynamics stable at 5-6% Increase in steel consumption Higher sales Slight Increase in products prices Expected stabilization or slight increase in Q4 2007 EBITDA in comparison to ; Q4 2006 in thousand PLN ZLOMREX VASTH TOTAL Sales 525 544 346 261 871 805 EBITDA 37 555 13 429 50 9
Slide 25: Q&A
_——sZEOMREX S.A. == —_O8A — Section 4
Slide 26: Appendix
_ ZLOMREX S.A. ___ APPENDIX
Slide 27: Q1-Q3 2007 Indebtedness
Appendix 1 Q 1 – Q3 2007 Indebtedness Q1 2007 Q2 2007 Q3 2007 Interest bearing debt long term, incl: 771 454 777 190 754 755 The notes 641 670 639 143 626 891 NFOS environmental loans 19 241 16 185 14 889 leasing 24 893 23 991 22 149 deferred payment for VASTH 23 217 22 959 23 624 VASTH put/call opt