Hindalco Industries Limited · NSE:HINDALCO
Hindalco Industries — Q3 FY17 Earnings Presentation
25 slides from Hindalco Industries's earnings presentation, Feb 13, 2017
Slide 1: Investor Presentation – Q3 FY17
Hindalco Investor Presentation – Q3 FY17 February 13, 2017
Slide 2: 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 3: Contents
Contents Key business highlights Economy and Industry at glance Financial highlights for quarter Operational and Financial review Aluminium (India) Copper Novelis 3
Slide 4: Key Business Highlights
Key Business Highlights Aluminium Record EBITDA on the back of higher LME and steady operational performance In addition to GP IV/4 & GP IV/5 coal mines, Kathautia mines commenced operations in February 2017 Prepaid Rs. 342 Crore loan in January 2017 – YTD Rs. 1,031 Crore Novelis Record Q3 A
Slide 5: Economy and Industry
ADITYA BIRLA HINDALCO, Economy and Industry
Slide 6: Economy
Economy Global Economy – Gaining momentum amidst challenges ○ IMF projected world economy to grow at 3.4% in CY 17 vs. 3.1% in CY 16 buoyed by Chinese stimulus and strong US growth ○ Uncertainty around US policy stance, Fed interest rate hike, BREXIT negotiations and continuation of Chinese stimulus
Slide 7: Aluminium Industry
Aluminium Industry Aluminium Prices Trend (USD/t) Environmental restrictions 1849 ◊ Additional shutdowns of Alumina 1,791 1,737 1,728 capacities – will increase cost push 1,666 1,629 1,639 1,571 1,551 1,594 1,592 ◊ Smelter shutdowns in China – impacting 1,531 1,531 1,481 ~0.5 MnT capacity Buoyan
Slide 8: Aluminium Industry Drivers
Aluminium Industry Drivers ○ YOY - Realizations improved due to higher LME, despite lower local market premium ○ Regional premium seem to have bottomed out In January 2017 MJP recovered to USD 95/t ○ Input cost continued to remain supportive However, both energy and alumina prices have started h
Slide 9: Copper Industry
Copper Industry ○ Higher Copper LME - Stronger demand in China and expectations around higher infrastructure spending in US ○ Supply uncertainties and improved demand for concentrate has resulted in decline in Benchmark TC/RC ○ Indian players were further impacted due to sharp drop in Sulphuric acid
Slide 10: Q3 FY17 - A strong operating performance
Q3 FY17- A strong operating performance
Slide 11: Q3 FY17 – Standalone Highlights
Q3 FY17 – Standalone Highlights Revenue Higher volumes and realization for Rs. 9,915 Crore (Y-o-Y up 14%) primary metal leading to growth Strong Aluminium operations, higher EBITDA Rs. 1,405 Crore volumes aided by improved realization (Y-o-Y up 64%) and lower input cost Overall strong performa
Slide 12: Aluminium (India)
ADITYA BIRLA HINDALCO, Aluminium (India)
Slide 13: Production Trend
Production Trend Alumina (KT) includes Utkal Metal (KT) 726 744 294 321 320 705 Q3 FY16 Q2 FY17 Q3 FY17 Q3 FY16 Q2 FY17 Q3 FY17 Production (KT) Q3 FY16 Q2 FY17 Q3 FY17 Strong production growth Wire Rods 35 40 40 ◊ Plants ramped up and operating at designed capacities FRP 66 68 69 VAP production
Slide 14: Utkal
Utkal Production (KT) 364 375 393 ○ Cash cost of Alumina amongst the lowest cost refineries of the world ○ Y-o-Y production grew by 8% Q3 FY16 Q2 FY17 Q3 FY17 EBITDA at Rs. 140 Crore in Q3 FY17 14
Slide 15: Copper
Copper
Slide 16: Production
Production Cathode (KT) CC Rods (KT) 106 40 42 94 94 32 Q3 FY16 Q2 FY17 Q3 FY17 Q3 FY16 Q2 FY17 Q3 FY17 DAP (KT) ○ Flat Cathode production 90 73 72 Sequentially lower production due to planned shutdown ○ CC rod production impacted by Q3 FY16 Q2 FY17 Q3 FY17 lower demand in domestic market 16
Slide 17: Novelis
ADITYA BIRLA HINDALCO, Novelis
Slide 18: Key Highlights
Key Highlights Auto Shipments (KT) ○ Aluminium Auto sheet demand 150 continued to be robust 140 Trailing twelve months share of Auto 130 120 shipments at 17% up from 15% in FY16 110 100 ○ Can market increasingly competitive due 90 to consolidation of customers and over- 80 capacity 70 60 ○ Signifi
Slide 19: Financial Performance
ADITYA BIRLA HINDALCO, Financial Performance
Slide 20: Financial Highlights - Standalone
Financial Highlights - Standalone (In Rs. crore) Q3 Q2 9 Months Particulars FY17 FY16 FY17 FY17 FY16 Revenue form Operations 9,915 8,716 9,562 27,636 27,450 Earning Before Interest, Tax and Depreciation (EBITDA) Aluminium 876 354 808 2,555 1,172 Copper 330 352 366 960 1,083 Others 200 153 319 735 68
Slide 21: Aluminium Standalone
Aluminium Standalone Revenue (Rs. Crore) EBITDA (Rs. Crore) 876 4930 4917 808 4529 354 Q3 FY16 Q2 FY17 Q3 FY17 Q3 FY16 Q2 FY17 Q3 FY17 Y-o-Y : Strong performance on account of higher realization, volumes and lower input cost Sequentially: Higher realization led to increase in EBITDA by 8% 21
Slide 22: Copper
Copper Revenue (Rs. Crore) EBITDA (Rs. Crore) 352 366 330 5000 4635 4190 Q3 FY16 Q2 FY17 Q3 FY17 Q3 FY16 Q2 FY17 Q3 FY17 Y-o-Y : Performance impacted due to lower by-product realization & TcRc Sequentially : Lower demand in domestic market and lower production due to planned shutdown 22
Slide 23: Novelis
Novelis Revenue (USD bn.) Adjusted EBITDA* (USD mn.) 2.4 2.4 270 2.3 255 238 Q3 FY16 Q2 FY17 Q3 FY17 Q3 FY16 Q2 FY17 Q3 FY17 Y-o-Y : Performance driven by higher auto shipments, recycling volumes, productivity gains Sequentially : Lower shipment on account of weak demand in Q3 - Seasonally weak quar
Slide 24: Hindalco: Towards Sustainable Leadership
Hindalco: Towards Sustainable Leadership Plants at Design Capacity ○ Plants running at designed capacity Robust Operational ○ Robust performance on the back of stable plant Performance operations aided by higher Aluminium prices ○ Kathautia mines commenced operations in Feb’17 Improved Coal Security
Slide 25: Thank You
Thank You REGISTERED OFFICE Century Bhavan, 3rd Floor, Dr. Annie Besant Road, Worli, Mumbai 400 030 Telephone- +91 22 6662 6666 Website: www.hindalco.com E mail: hindalco@adityabirla.com Corporate Identity No. L27020MH1958PLC011238