Aperam S.a. · EURONEXT:APAM
Aperam — Merger or Acquisition (December 2010)
32 slides from Aperam's merger presentation, Dec 16, 2010
Slide 1: Aperam – Spin-off and financials
Aperam – Spin-off and financials Julien Onillon – Chief Financial Officer & Strategy 16 December 2010
Slide 2: Forward-looking Statements
Forward-looking Statements This document may contain forward-looking information and statements about ArcelorMittal and its subsidiaries. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respec
Slide 3: Content
Content • Spin-off process and calendar • Financial overview • Financial overview by segment • Financing • Corporate governance • Q&A 2
Slide 4: Spin-off rational, process and calendar
Spin-off rational, process and calendar 3
Slide 5: Spin-off rational
Spin-off rational Extract from ArcelorMittal and Aperam Boards report “Stainless steel is a capital intensive business that has been competing within ArcelorMittal for capital allocation for additional investment, in particular against the strategic focus of ArcelorMittal on mining expansion and car
Slide 6: Aperam spin-off
Aperam spin-off Mechanics – Description • Aperam shares to be attributed pro rata to parent shareholders through a spin-off process Parent Shareholders – Transitional Services Agreement • Aperam and ArcelorMittal to enter transitional 2 services agreement, purchasing /sourcing service agreement in o
Slide 7: Calendar
Calendar – 8 December 2010: Announcement of the spin-off approval by the Boards of Directors of ArcelorMittal – 16 December 2010: Publication of the Aperam listing prospectus and publication of the convening notice for the EGM of ArcelorMittal – January 2011: Management roadshow – 25 January 2011: E
Slide 8: Financial overview
“<= ArcelorMittal Financial overview
Slide 9: Profitability drivers
Profitability drivers EBITDA in million of USD Profitability key drivers – Leadership journey 1,178 • USD 250 million over the next two years resulting from cost reductions and increasing productivity 930 – Volume • According to CRU, stainless steel market expected to Average 2007-2009 of USD778m in
Slide 10: P&L historical highlights
P&L historical highlights – Shipments Shipments in millions of tonnes • In 2009, shipments declined by 26% due to the global 1,969 1,958 economic crisis but rebounded by 35% in H1 2010 1,447 compared to H1 2009 915 – Sales 460 • Sales declined by 49% in 2009 as transaction price dropped in addition
Slide 11: P&L details
P&L details (USDm) 2007 2008 2009 H1 2010 Q3 2010** Sales 9,219 8,358 4,235 2,798 1,372 EBITDA 1,178 930 226 322 66 - EBITDA margin % 12.8% 11.1% 5.3% 11.5% 4.8% Non-recurring charges* - 209 100 - - Depreciation and impairment 275 339 333 146 72 Operating Income (loss) 903 382 -207 176 (6) - Operati
Slide 12: Cash-flow historical highlights
Cash-flow historical highlights – Cash-flow from operations Cash-flow from operation USDm • Following EBITDA, cash-flow from operation has 1,386 dropped significantly during the 2009 crisis but remained positive • Increase in activity and working capital has led to a 488 cash outflow in H1 2010 214
Slide 13: Cash-flow statement details
Cash-flow statement details (USDm) 2007 2008 2009 H1 2010 Q3 2010* Net Income (loss) 398 59 (150) 114 (12) Non-controlling interests 161 39 - 1 - Depreciation and impairment 275 339 333 146 72 Change in working capital 390 (173) 277 (278) (94) Other items and operating activities 162 224 (246) (23)
Slide 14: Pro forma balance sheet highlights (H1 2010)
Pro forma balance sheet highlights (H1 2010) – Intangible & goodwill Working capital USDm* • Goodwill of approximately USD 0.9bn mainly Payable related to ArcelorMittal merger. Acesita goodwill Receivable 468 deducted from equity. Inventories – Non-current assets 1464 975 • Approximately USD 3.3bn e
Slide 15: Balance sheet details
Balance sheet details (USDm) 2007 2008 2009 H1 2010 H1 2010 Pro forma* Non current assets 5,222 4,631 5,023 4,195 4,195 Goodwill and intangible assets 1,121 973 1,045 924 924 Property, plant and equipment 3,610 3,106 3,193 2,774 2,774 Other non current assets 491 552 785 497 497 Current assets & wor
Slide 16: Financial overview by segment
Financial overview by segment 15
Slide 17: Stainless & Electrical Steel financial highlights
Stainless & Electrical Steel financial highlights – Shipments Shipments in millions of tonnes 1893 1881 • In 2009, shipments declined by 27% due to the global economic crisis which impacted both regions. Rebound 1374 in H1 2010 was faster in South America than in Europe 868 – Sales • Sales declined
Slide 18: Stainless & Electrical Steel - Leadership Journey and value creation drivers
Stainless & Electrical Steel - Leadership Journey and value creation drivers – Leadership Journey Management gains breakdown by segment for 2011 • Variable cost improvement resulting from full biomass (charcoal) integration and access to natural gas in Brazil Other Stainless & 26% Electrical Steel •
Slide 19: Operating performance for Stainless & Electrical Steel
Operating performance for Stainless & Electrical Steel (000t) 2007 2008 2009 H1 2010 Q3 2010** Shipments 1,893 1,881 1,374 868 427 - Europe Shipments 1,215 1,215 859 567 263 - Brazil Shipments 678 666 515 301 164 (USDm) 2007 2008 2009 H1 2010 Q3 2010 ** Sales 7,474 6,787 3,185 2,260 1,058 EBITDA 1,0
Slide 20: Services & Solutions financial highlights
Services & Solutions financial highlights – Shipments Shipments in millions of tonnes • In 2009, shipments declined by 16% due to the global 643 684 economic crisis but the segment was more resilient 575 than the Stainless & Electrical steel segment 346 – Sales • Sales declined by 38% in 2009 due to
Slide 21: Services & Solutions - Leadership Journey and value creation drivers
Services & Solutions - Leadership Journey and value creation drivers – Leadership Journey Management gains breakdown by segment for 2011 • Fixed cost and variable cost reduction expected from several optimisation initiatives in Tubes and Services & South America Solutions 8% • Overall fixed and SG&A
Slide 22: Operating performance for Services & Solutions
Operating performance for Services & Solutions (000t) 2007 2008 2009 H1 2010 Q3 2010** Shipments 643 684 575 346 159 (USDm) 2007 2008 2009 H1 2010 Q3 2010** Sales 3,094 2,823 1,758 1,185 576 EBITDA 79 42 13 68 13 Unusual & non-recurring charges* - 55 17 - - Impairment - - 5 - - Depreciation and amor
Slide 23: Alloys & Specialties Financials highlights
Alloys & Specialties Financials highlights – Shipments Shipments in million tonnes • In 2009, shipments declined by 31% due to the global 39 36 economic crisis and a decline in certain specific “project” markets such as LNG tankers. 27 • In H1 2010, shipment increased by 14% due to overall 16 recove
Slide 24: Alloys & Specialties - Leadership journey and value creation drivers
Alloys & Specialties - Leadership journey and value creation drivers – Leadership journey Management gains breakdown by segment for 2011 • Fixed cost and variable cost reduction per ton expected through continuous improvement, yield Alloys & and quality enhancements Specialities 5% • Continuing opti
Slide 25: Operating performance for Alloys & Specialities
Operating performance for Alloys & Specialities (000t) 2007 2008 2009 H1 2010 Q3 2010** Shipments 36 39 27 16 7 (USDm) 2007 2008 2009 H1 2010 Q3 2010** Sales 872 801 435 237 126 EBITDA 67 37 16 25 7 Non-recurring charges* - 5 11 - - Impairment - - - - - Depreciation 6 6 6 3 1 Operating income (loss)
Slide 26: Financing
“<= ArcelorMittal Financing
Slide 27: Financial policy
Financial policy – Communication • Maintain high standards of disclosure through regular and transparent dialogue with regulators, debt community and rating agencies – Funding • Funding raised primarily by the parent company (except certain financing facilities in Brazil and overdraft lines for subs
Slide 28: Financing strategy
Financing strategy RCF $100 – USD 100 million revolving credit facility USD500 • 3 year facility BBF million of lines (undrawn) • Secured by fixed assets $400 – USD 800 million borrowing base facility BBF • 3 year facility (drawn) $400 • Secured by inventories and receivables USD1.1 – USD 500 millio
Slide 29: Corporate governance
“<= ArcelorMittal Corporate governance
Slide 30: Board of Directors structure
Board of Directors structure Targeted final BOD structure Committees of the Board 4 3 Non • Audit and Risk Management Independent Independent Directors Directors • Remuneration, Nomination and Corporate Governance Independent Non-Independent members of the BoD members of the BoD • Sustainability, Pe
Slide 31: Corporate Governance framework
Corporate Governance framework 1. Independent Board of Directors 3. Corporate governance practices The Company is committed to adopting best practice corporate governance standards. The Company will 2. Lead Independent Director continuously monitor U.S., European Union and - Coordination of the acti
Slide 32: ArcelorMittal
“<= ArcelorMittal