Metair Investments Limited · JSE:MTA
Metair Investments — Investor Day (2017)
58 slides from Metair Investments's investor day presentation, 2017
Slide 1: Metair Site Visit – Turkey 2017
METAIR SITE VISIT – TURKEY 2017
Slide 2: Site Visit Presentation - Overview
SITE VISIT PRESENTATION - OVERVIEW This presentation has been prepared to provide investors with supplementary disclosure relating to the strategy, financial and operational information of previously published annual and interim results. In addition, Metair wished to update margin guidance for the A
Slide 3: Agenda
AGENDA • Opening observation – Who is Metair? • Disruptive Technology - Metair Electric Vehicle (EV) adaptability • Enhancement of Metair strategy • Financial & Operational supplementary disclosures • Prospects • Q &A 3
Slide 4: Opening Observation: Who Is Metair
OPENING OBSERVATION WHO IS METAIR Metair Investments Limited is a 70-year old listed company on the Johannesburg Securities Exchange (JSE) who is invested in 11 companies in South Africa and 5 International operations covering two distinct business verticals. The Energy Vertical operates locally and
Slide 5: Opening Observation: Who Is Metair – Product Offering
OPENING OBSERVATION WHO IS METAIR In the Energy Vertical our product offering range from lead acid batteries to Li-ion energy solutions for the automotive, retail, standby, mining, utilities, telecommunications and OEM industry. In the Automotive Components Vertical our product offering ranges from
Slide 6: Enhanced Metair Globalisation Strategy
ENHANCED METAIR GLOBALISATION STRATEGY COMPANY DESIGN Metair’s strategy for our Energy Storage Vertical is to become the world leader in the supply of energy source products used in control and energy solutions across the full spectrum of mobility options and to nurture our Automotive Components Ver
Slide 7: Investee Companies
OPENING OBSERVATION INVESTEE COMPANIES Moll GmbH & Co. 25.1% International distribution of key battery group KG products 7
Slide 8: Who Is Metair: Electric Vehicle Environment
OPENING OBSERVATION WHO IS METAIR Metair continues to operate in an exciting and very dynamic environment. We remain well positioned to take advantage of changing technological trends, especially in our energy storage vertical where market conditions and dynamics are subject to technology shifts in
Slide 9: Metair Electric Vehicle Adaptability
METAIR ELECTRIC VEHICLE ADAPTABILITY DISRUPTIVE TECHNOLOGIES 9
Slide 10: Metair as a Visionary
METAIR ELECTRIC VEHICLE ADAPTABILITY DISRUPTIVE TECHNOLOGIES METAIR AS A VISIONARY – Metair group companies built two EV’s in 2012. METAIR MINDSET – To accept the EV challenge and possibility of a 100% EV production scenario sometime in the future. – To plan the group’s path to real EV relevance and
Slide 11: 2012: In-House Production of Two EVs
METAIR ELECTRIC VEHICLE ADAPTABILITY 2012: IN-HOUSE PRODUCTION OF TWO EV’S Design of Metair EV from first principles: Retrofit internal combustion engine with electric motor and battery power source: 11
Slide 12: Is our current product range required in EVs?
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR PRODUCTS Is our current product range required in EV’s? 12
Slide 13: What Is Our Current Product Range?
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR PRODUCTS COMMODITY LINK WHAT IS OUR CURRENT PRODUCT RANGE? • Wiring harnesses - Copper • Lighting – Plastics • Heat exchange products – Aluminium • Plastic products - Plastics • Ride control products – Steel & composites • Energy storage batteries – Lead,
Slide 14: Gain Importance & Relevance
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR PRODUCTS GAIN IMPORTANCE & RELEVANCE PRODUCTS RELEVANCE INCREASE Wiring harnesses Gain 80% increase in copper Lighting Gain Increase in aesthetics Heat exchange products Gain/Loss 20% increase in aluminium Plastic products Gain EV >20% heavier Ride control
Slide 15: Is our current product range required in EVs?
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR CONCLUSION Is our current product range required in EV’s? 15
Slide 16: Yes most definitely
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR CONCLUSION YES most definitely 16
Slide 17: But when?
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR CONCLUSION BUT when? 17
Slide 18: Metair Observations: EV Weight and Carbon Footprint
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR OBSERVATIONS • EV’s >20% heavier than ICE-V • 70% of the carbon footprint is in the production of the vehicle • More commodities in EV’s require more conversion energy – carbon footprint is larger than ICE-V • Lifecycle carbon footprint of EV’s that is cha
Slide 19: Metair Observations: Hybrids and Start/Stop
METAIR ELECTRIC VEHICLE ADAPTABILITY METAIR OBSERVATIONS • Hybrid vehicles will increase in importance and share the diesel derivative elimination with petrol derivatives • Start/Stop battery storage solutions are the gateway technology in the pathway to full EV technology 19
Slide 20: Energy Storage Advancement
ENERGY STORAGE ADVANCEMENT 20
Slide 21: Programme for Locally Produced Lithium-Ion Storage Solutions
METAIR LAUNCHES PROGRAMME TO DELIVER LOCALLY PRODUCED LITHIUM-ION STORAGE SOLUTIONS IN SA, TURKEY AND ROMANIA • Programme aims to balance the use of locally available commodities with internationally recognised chemistry solutions • Partnership approach with academia and industry agencies on product
Slide 22: Lithium Ion Battery – Electrode
LITHIUM ION BATTERY – ELECTRODE MANUFACTURE AT ESIL, UWC, CAPE TOWN 18650 Cell Type 22
Slide 23: Lithium Ion Battery – Electrode
LITHIUM ION BATTERY – ELECTRODE MANUFACTURE AT ESIL, UWC, CAPE TOWN 23
Slide 24: Lithium Ion Battery – MIB Collaboration
LITHIUM ION BATTERY – MIB COLLABORATION 24
Slide 25: Lithium Ion Battery – Production Steps
LITHIUM ION BATTERY – PRODUCTION STEPS 25
Slide 26: Lithium Ion Battery – Cell Design Types
LITHIUM ION BATTERY – CELL DESIGN TYPES 26
Slide 27: 12V Lithium Ion Battery Development
12V LITHIUM ION BATTERY DEVELOPMENT 27
Slide 28: Lithium Ion Battery – BASF Chemistry
LITHIUM ION BATTERY – BASF CHEMISTRY 28
Slide 29: Lithium Ion Battery – Primemotors Collaboration
LITHIUM ION BATTERY – PRIMEMOTORS COLLABORATION Metair’s first vehicle converted from Internal Combustion Engine to a full electric vehicle. The EV was produced in cooperation with Primemotors in Romania and fitted with in-house Lithium Ion battery technology. The EV conversion showcases Metair’s un
Slide 30: Enhancement of Metair Strategy
ENHANCEMENT OF METAIR STRATEGY MOBILITY SOLUTION & MARKET DEVELOPMENT INFLUENCE 30
Slide 31: How Do We Deliver on the Strategy
ENHANCED METAIR GLOBALISATION STRATEGY HOW DO WE DELIVER ON THE STRATEGY • First 3 X 5 strategy Phase 1 • 2005 - 2010 Local Relevance • R5 billion turnover DELIVERED • R500 million PBIT • Second 3 X 5 strategy Phase 2 • 2011 - 2014 Internationalisation • 50% Aftermarket DELIVERED • 50% OE • 50% Batt
Slide 32: Main Drivers Behind Global Strategy
ENHANCED METAIR GLOBALISATION STRATEGY MAIN DRIVERS BEHIND GLOBAL STRATEGY • Intellectual property in Start Stop Technology • Successful industrialization of Start Stop Technology • Global carbon emission reduction drive • Reduction of all types of pollution coming from mobility options • Customer n
Slide 33: Main Drivers Behind Global Strategy
ENHANCED METAIR GLOBALISATION STRATEGY MAIN DRIVERS BEHIND GLOBAL STRATEGY Phase 1 Product & customer diversification within Shareholder SA opportunity Support Management Support Customer Support Phase 3 Phase 2 Technology transfer Technology transfer Board request from India, request from Turkey, R
Slide 34: Current Locations: Due to Request for TAs
ENHANCED METAIR GLOBALISATION STRATEGY CURRENT LOCATIONS: DUE TO REQUEST FOR TA’S Russia North America Europe China India Africa South America Australia 34
Slide 35: Longevity of Product & Technology
ENHANCED METAIR GLOBALISATION STRATEGY LONGEVITY OF PRODUCT & TECHNOLOGY “In order to maximise the span between the front and the back end of the technology spectrum Metair and our partners want to over-lay our energy solution offering across the full mobility spectrum in both developed and emerging
Slide 36: Mobility Spectrum
ENHANCED METAIR GLOBALISATION STRATEGY MOBILITY SPECTRUM Global Mobility Parc (‘000) E-Bike 210 526 Russia North 2-Wheeler 134 500 America Europe 3-Wheeler 3 069 China 4-Wheeler 1 369 748 India Trucks 234 615 Africa Electric 1 326 Vehicles South America Australia 36
Slide 37: Markets: Developed and Emerging
ENHANCED METAIR GLOBALISATION STRATEGY MARKETS: DEVELOPED AND EMERGING Plan A Plan B Russia Moscow Rotterdam North America Duisburg Europe Istanbul Bishkek Huoerguosii Venice Almaty Urumqi Samarkand China Lanzhou Athens Tehran Dushanbe Xl’an India Kolkata Africa Colombo Kuala Lumpur Nairobi South Am
Slide 38: Company Design
ENHANCED METAIR GLOBALISATION STRATEGY COMPANY DESIGN Metair’s strategy for our Energy Storage Vertical is to become the world leader in the supply of energy source products used in control and energy solutions across the full spectrum of mobility options and to nurture our Automotive Components Ver
Slide 39: Access to Experts
ENHANCED METAIR GLOBILISATION STRATEGY ACCESS TO EXPERTS DR RAINER WAGNER DR CSAPO MARTINESCU ERNEST ELOD MOLL Batterien Rombat Chemistry/Electrochemistry, PhD. Philosophiae Doctor Electrochemical PhD Technical Science , Electrical machines, apparatus and electrical drives DR DENİZ ŞEKER DR LOUIS DE
Slide 40: Access to Experts
ENHANCED METAIR GLOBILISATION STRATEGY ACCESS TO EXPERTS Name Major 1. Dr Sun Yanxian Electrochemistry 2. Dr Liu Xia Condensed Matter Physics 3. Dr Zhang Hongtao Materials Science and Engineering 4. Dr Chang Linrong Chemistry 5. Dr Deng Jiyang Materials Science 6. Dr Li Hongtao Polymer Chemistry and
Slide 41: Background on Chaowei Power Holdings Ltd
BACKGROUND ON CHAOWEI POWER HOLDINGS LTD 41
Slide 42: Chaowei Power Holdings Limited
CHAOWEI POWER HOLDINGS LIMITED • Listed on the Hong Kong Stock Exchange • Acquired a stake in Moll in 2013 • Group’s manufacturing and management headquarters is located at Changxing County, Zhejiang Province, China • Largest producer of lead-acid e-bike batteries in China • Annual production capaci
Slide 43: Chaowei Power Holdings Limited
CHAOWEI POWER HOLDINGS LIMITED • Manufactures and sells lead-acid and Li-ion batteries and other related products for the use in • Electric bikes • Electric vehicles • Special-purpose electric vehicles • Storage batteries • Innovative Product Technology / Leading Industry Development • Leading playe
Slide 44: Financial & Operational Supplementary Disclosures
FINANCIAL & OPERATIONAL SUPPLEMENTARY DISCLOSURES 44
Slide 45: Financial Highlights
FINANCIAL HIGHLIGHTS METAIR’S RECENT HISTORY HAS BEEN INFLUENCED BY A NUMBER OF SPECIFIC EVENTS WHICH ARE UNLIKELY TO RECUR IN THE SHORT TO MEDIUM TERM June’17 June’17 (LTM) (LTM) Revenue HEPS R9 bn 289 cps PBIT Net debt R915 m R1.2 bn Net Debt: PAT EBITDA R564 m 1.0 Free cash PBIT % flow 9.2% R297
Slide 46: Financial Highlights: Recent History
FINANCIAL HIGHLIGHTS METAIR’S RECENT HISTORY HAS BEEN INFLUENCED BY A NUMBER OF SPECIFIC EVENTS WHICH ARE UNLIKELY TO RECUR IN THE SHORT TO MEDIUM TERM 2013: 2015: • Acquisition of Mutlu • Mutlu export to CIS countries impacted by weakening • Transaction costs currencies due to lower oil price 2013C
Slide 47: Energy Storage Vertical at a Glance – LTM June'17
ENERGY STORAGE VERTICAL AT A GLANCE – LTM JUNE’17 ENERGY STORAGE REVENUE OPERATING PROFIT R5.7 BILLION R550 MILLION 57% Contribution 57% Contribution 3.3K EMPLOYEES 6 COUNTRIES (incl. Associates) 7 MANUFACTURING SITES AND 3 RECYCLING FACILITIES R&D CENTRES IN GERMANY AND TURKEY PBIT MARGIN: 9.4% ROI
Slide 48: Auto Components Vertical at a Glance – LTM June'17
AUTO COMPONENTS VERTICAL AT A GLANCE - LTM JUNE’17 AUTOMOTIVE COMPONENTS REVENUE OPERATING PROFIT R4.4 BILLION R423 MILLION 43% Contribution 43% Contribution 4.5K EMPLOYEES 8 MANUFACTURING SITES IN SOUTH AFRICA 2 ASSOCIATES IN EASTERN CAPE LOCAL CONTENT MANUFACTURER AND SUPPLIER OF AUTOMOTIVE COMPON
Slide 49: Metair – LTM June'17 Financial Metric Analysis
METAIR – LTM JUNE’17 FINANCIAL METRIC ANALYSIS 1) South African revenue base remains the largest 2) Similar trend for PBIT, but foreign earnings 3) Vertical revenue by geography & segment contributor at 61%, Energy Storage is 57% of total slightly higher overview – source of revenue revenue 4) Group
Slide 50: Energy Storage
ENERGY STORAGE 1) Mutlu contributed > 45% of total vertical 2) And contributed > 60% of vertical PBIT. The 3) Energy storage vertical PBIT largely flat over revenue graphs show the 2015 impact of Mutlu loss of CIS the past 18 months despite TRY currency country exports and subsequent strong recovery
Slide 51: Energy Storage Volumes
ENERGY STORAGE VOLUMES (* rounded) 1) Total volumes by operation 2) Energy Storage auto volumes has grown 3) Mutlu auto volumes have grown well due to significantly from 2015 volumes of 7.2m to 7.8m increased OEM volumes (market share and production volume growth) and a growing AM despite 1H’17 pric
Slide 52: Automotive Components
AUTOMOTIVE COMPONENTS 1) Direct revenue by major OEM customers 2) Auto Components vertical PBIT & Margin 3) SA vehicle production volumes (NAAMSA) shows a strong recovery after model launch 1H’17. remains largely flat, with lower domestic sales Medium term PBIT guidance updated to 7-9% offset by rec
Slide 53: Prospects
METAIR INVESTMENTS LIMITED ‘autor motive | industrial | retail PROSPECTS 53
Slide 54: General Prospects Statement
GENERAL PROSPECTS STATEMENT The prospects statement, as contained in the Integrated Annual Report of Metair for 2016, indicated that the group will only feel the real effect of the Turkish Lira devaluation in 2017 as the currency settles at a lower level. The good improvement in first half results s
Slide 55: Prospects: Automotive Components Vertical
PROSPECTS AUTOMOTIVE COMPONENTS VERTICAL This business vertical managed to renew most of the business associated with the new model launch in support of the next business cycle linked to Automotive new model launches. Components Vertical The major challenges to the next five- to seven-year cycle in
Slide 56: Prospects: Energy Storage Vertical
PROSPECTS ENERGY STORAGE VERTICAL The second half of the year traditionally benefits from seasonal demand brought about by the winter period associated with the Energy Storage Vertical market served by Rombat and Mutlu in Europe and the Middle East. In the South African market we expect moderately i
Slide 57: Q&A
57 Q&A WWW.METAIR.CO.ZA METAIR INVESTMENTS LIMITED ‘automotive | industrial | retail
Slide 58: Disclaimer
DISCLAIMER DISCLAIMER The information supplied herewith is believed to be correct but the accuracy thereof at the time of going to print is not guaranteed. The company and its employees cannot accept liability for loss suffered in consequence of reliance on the information provided. Provision of thi