Outokumpu Oyj · OMXHEX:OUT1V
Outokumpu Oyj — FY2003 Earnings Presentation
14 slides from Outokumpu Oyj's earnings presentation, Feb 10, 2004
Slide 1: Annual Accounts 2003 – Highlights of 2003
Annual Accounts 2003 Outokumpu Oyj Annual Accounts 2003 February 10, 2004 Dr. Jyrki Juusela, CEO stainless | copper | technology Highlights of 2003 • World economic growth accelerated in H2 and sentiment of the metals market improved. However, conversion margins and treatment charges declined in 200
Slide 2: Outokumpu and Boliden completed a major zinc and copper restructuring
Annual Accounts 2003 Outokumpu Oyj Outokumpu and Boliden completed a major zinc and copper restructuring • Boliden acquired Outokumpu’s mining and smelting operations within zinc and copper and sold its fabrication and technology sales operations to Outokumpu. • Total consideration to Outokumpu some
Slide 3: Fourth quarter profits boosted by unusuals
Annual Accounts 2003 Outokumpu Oyj Fourth quarter profits boosted by unusuals Oct- July- Oct- Dec Sept Dec EUR million 2003 2003 2002 Net sales 1 535 1 464 1 391 Operating profit 124 29 15 Operating profit, comparable 25 (1) 13 EPS, € 0.63 0.01 0.06 ROCE, % 11.5 2.4 1.3 Debt-to-equity ratio (gearing
Slide 4: Stainless steel conversion margin
Annual Accounts 2003 Outokumpu Oyj Stainless steel conversion margin EUR/kg 2.00 1.50 1.00 0.50 0.00 94 95 96 97 98 99 00 01 02 03 December 2003 Source: CRU 7 | Feb. 10, 2004 | Annual Accounts 2003 Net sales EURm 6 000 5 000 4 000 3 000 2 000 1 000 0 99 00 01 02 03 8 | Feb. 10, 2004 | Annual Account
Slide 5: Net sales by business
Annual Accounts 2003 Outokumpu Oyj Net sales by business EUR million 2003 2002 Change, % Stainless 3 449 3 002 15 Copper 1 626 1 669 (3) Zinc 396 418 (5) Technology 402 399 1 Other operations 390 336 16 Intra-group sales (342) (266) 29 The Group 5 921 5 558 7 • Biggest increase in Stainless due to h
Slide 6: Operating profit by business
Annual Accounts 2003 Outokumpu Oyj Operating profit by business EUR million 2003 2002 Change Stainless 104 204 (100) Copper 7 53 (46) Zinc 16 3 13 Technology 0 4 (4) Other operations 79 18 61 Intra-group sales 0 (15) 15 The Group 206 267 (61) • Operating profit declined from previous year both at St
Slide 7: Capital structure improved
Annual Accounts 2003 Outokumpu Oyj Capital structure improved EUR million 2003 2002 Cash flow from operating activities 214 334 Net interest-bearing debt 2 013 2 385 Equity-to-assets ratio, % 32.3 31.1 Debt-to-equity ratio, % 102.8 122.6 • Improvement due to several asset disposals. 13 | Feb. 10, 20
Slide 8: Capital expenditure remained high
Annual Accounts 2003 Outokumpu Oyj Capital expenditure remained high • Total capital expenditure still relatively high at € 622 million (2002: € 2 042 million). The comparison figure includes € 1 118 million used for the acquisition of the AvestaPolarit minority interest. • Investment in Tornio stai
Slide 9: Challenges for 2004 / Improved profits for 2004
Annual Accounts 2003 Outokumpu Oyj Challenges for 2004 • Ramp-up • Gearing • Integration • Cash flow • Operational excellence • Leveraging the re-vitalized brand 17 | Feb. 10, 2004 | Annual Accounts 2003 Improved profits for 2004 • Tornio ramp-up still key factor for Outokumpu’s profitability. • Gra
Slide 10: Stainless in 2003
Annual Accounts 2003 Outokumpu Oyj Stainless in 2003 Pekka Erkkilä President – Outokumpu Stainless stainless | copper | technology Profitability weakened y-o-y • Comparable operating profit for 2003 totaled €117 million (184). For Q4 €23 million • Net sales increased 15% compared with year 2002 and
Slide 11: Investment projects
Annual Accounts 2003 Outokumpu Oyj Investment projects • Tornio expansion • New melting shop back in pace • RAP 5 proceeding in ramping-up • Steckel mill expansion proceeding as planned • Billet caster ramping-up in Sheffield completed • Long products capacity increase in North America underway 21 |
Slide 12: European cold rolled price in Q4
Annual Accounts 2003 Outokumpu Oyj European cold rolled price in Q4 EUR/t Cold Rolled price development (304 2B German prices) 2600 Transaction price 2300 Source: Outokumpu Stainless estimates, up-to and including January 2004 2000 AAF 1700 1400 1100 Base price 800 1998 1999 2000 2001 2002 2003 2004
Slide 13: Restructurings continue
Annual Accounts 2003 Outokumpu Oyj Restructurings continue • Panteg cold rolling mill to be closed by end of Q1/ 2004 • Tubes and fittings businesses to be consolidated as one business unit • marketing synergies • rationalization of both production and logistics 25 | Feb. 10, 2004 | Annual Accounts
Slide 14: Outokumpu has aligned all its businesses under the Outokumpu brand
Annual Accounts 2003 Outokumpu Oyj Outokumpu has aligned all its businesses under the Outokumpu brand • Renewed brand and a new visual identity launched on January 12, 2004. • According to the new brand hierarchy, all Outokumpu business areas have adopted a uniform name structure. The uniformity wil