Rusal · RUS:RUAL
Rusal — UC Rusal — H1 2021 Earnings Presentation
32 slides from Rusal's earnings presentation, Aug 13, 2021
Slide 1: 1H2021 Financial Results Presentation
1 1H2021 FINANCIAL RESULTS PRESENTATION 13 August, 2021
Slide 2: Disclaimer
DISCLAIMER These materials and the subsequent discussion are not an offer for sale of any securities of United Company RUSAL Plc (the “Company”). The distribution of these materials in certain jurisdictions may be restricted by law and therefore persons into whose possession these materials come sho
Slide 3: Agenda
AGENDA Overview Operating and financial results review Capital management: capex and debt Market overview Appendix 3
Slide 4: Overview: Rusal's Progress Over the Period
OVERVIEW: RUSAL’S PROGRESS OVER THE PERIOD 1H21 1H20 Change 2H20 Change Average Aluminium Price $2,245/t $1,592/t $1,812/t Macro Average Nickel Price $17,439/t $12,477/t $15,118/t parameters 74.28 69.37 74.89 Average USD / RUB FX Rate RUB/USD RUB/USD RUB/USD Total sales, kt 2,000 kt 1,890 kt 2,036 k
Slide 5: Low-Carbon Strategy Achievements
LOW-CARBON STRATEGY ACHIEVEMENTS RUSAL REMAINS COMMITTED TO THE CONTINUOUS IMPROVEMENT OF ENVIRONMENTAL FOOTPRINT One of Rusal’s strategic goals is to reduce direct specific Greenhouse Gas emissions (Scope 1¹) reduction of 13.4% greenhouse gas emissions at smelters (Scope 1*) by 15% by 2.33 2.4 2.
Slide 6: Health and Safety
HEALTH AND SAFETY LTIFR DYNAMICS 1H21 HIGHLIGHTS In order to prevent accidents and incidents at hazardous 1.90 production facilities of the Company, a set of industrial safety 1.70 works has been carried out in 1H21: technical audit of hazardous production facilities at 13 1.30 1.30 1.30 1.20 pr
Slide 7: Agenda
AGENDA Overview Operating and financial results review Capital management: capex and debt Market overview Appendix 7
Slide 8: Aluminium Price and Sales Structure in 1H21
ALUMINIUM PRICE AND SALES STRUCTURE IN 1H21 In 1H21, aluminium sales amounted to 2,000 thousand tonnes VAP SHARE IN SALES (+5.8% YoY). Increase in sales is primarily attributable to % of sales intensified market demand; 45% 44% 50% 37% 42% In 1H21 European destination still dominates the mix, ho
Slide 9: Financials Overview: Revenue Structure
FINANCIALS OVERVIEW: REVENUE STRUCTURE REVENUE STRUCTURE REVENUE DYNAMICS 7% 7% Aluminium average realized price ($/t) 4% 4% 6% 5% 2,287 1,960 1,884 1,756 1,852 1H20 Revenue 1H21 Revenue $4,015 mn $5,449 mn Aluminium sales volume (kt) 83% 84% 2,198 1,978 2,036 2,000 1,890 Aluminium Alumina Foil and
Slide 10: Financials Overview: Key Segments Cash Cost
FINANCIALS OVERVIEW: KEY SEGMENTS CASH COST In 1H21 Rusal’s cash cost per 1 tonne of aluminium produced amounted to $1,523/t (-2.6% YoY). The decrease of cash cost of aluminium was led by a simultaneous YoY decline of major items on the back of a shift in USD/RUB FX rate: 1.6% decrease of alumina
Slide 11: Energy Cost Dynamics
ENERGY COST DYNAMICS ELECTRICITY PURCHASE PRICE ANALYSIS Cent/ kWh -1.4% YoY 0.13 0.20 0.02 0.22 0.02 2.95 2.91 0.15 2.56 1H20 Exchange Capacity "Day-ahead" 2H20 Exchange Capacity "Day-ahead" 1H21 rate costs¹ market rate costs¹ market tariff tariff USD/ USD/ USD/ RUB RUB RUB 69.3 64.2 69.3 In 1H21
Slide 12: Financial Overview: EBITDA
FINANCIAL OVERVIEW: EBITDA In 1H21 EBITDA totaled $1,315 mn. The growth was primarily due to recovery of LME aluminium price, as well as an improvement of the sales structure and positive change in cash cost. The aluminium segment remained the largest contributor to the Group EBITDA. EBITDA CHAN
Slide 13: Free Cash Flow
FREE CASH FLOW RUSAL’S PARTICIPATION IN BUYBACK OF NORNICKEL SHARES HAS CONTRIBUTED TO 1H21 GROWTH OF FCF 1H20 $ mn 1H21 219 EBITDA 1 315 Including Including - inventories decrease of $75 mn - inventories increase of -$421 mn 28 Change in WC 634 - trade and other receivables decrease - trade and oth
Slide 14: Agenda
AGENDA Overview Operating and financial results review Capital management: capex and debt Market overview Appendix 14
Slide 15: Capital Expenditure
CAPITAL EXPENDITURE CAPEX SEMI-ANNUAL DYNAMICS CAPEX 1H21 CAPEX GUIDANCE 2021 $ mn 897 842 848 834 Taishet Aluminium 600 19% Smelter 17% 500 Taishet Anode Plant 400 7% $554mn 12% 300 554 $1.1–1.3bn 521 495 496 200 417 417 401 7% Other development 321 353 capex 61% 67% 100 10% 0 Maintenance capex 1H1
Slide 16: Taishet Aluminium Smelter
TAISHET ALUMINIUM SMELTER Location Irkutsk region TAISHET CONSTRUCTION SITE AND KEY FACILITIES 2. Anode assembly 3. Foundry 1. Storage facilities 1st stage – 428.5 ktpa, 352 potcells RA-400, department amperage 440 kA; Capacity/ technology¹ 2nd stage – 536 ktpa, 352 potcells RА-550, amperage 5
Slide 17: Taishet Anode Plant
TAISHET ANODE PLANT Location Irkutsk region ANODE PLANT CONSTRUCTION SITE AND 2nd STAGE KEY FACILITIES 1st stage – the construction of anode baking 2. 2nd anode block roasting section 3.Mixing and pressing section 4.Hard pitch warehouse furnace with a capacity of up to 217.5 ktpa of baked anodes
Slide 18: Modernization Project
MODERNIZATION PROJECT In June 2021 Rusal announced its intention to implement a Modernization Project to create new production facilities on the sites of its existing workshops of aluminium smelters. The intention is to significantly improve the production technology and environmental sustainability
Slide 19: Debt Profile
DEBT PROFILE In 1H21 the Group signed a sustainability linked pre-export finance facility CREDIT RATINGS DEBT STRUCTURE with Societe Generale for up to $200 mn, 3 years maturity to refinance more EURO expensive debt. The facility is priced at 3mLibor+1.8%, with the possibility By currency 0.4% to
Slide 20: Agenda
AGENDA Overview Operating and financial results review Capital management: capex and debt Market overview Appendix 20
Slide 21: Growth in Demand Matched by Record Aluminium Production
GROWTH IN DEMAND MATCHED BY RECORD ALUMINIUM PRODUCTION PRIMARY ALUMINIUM DEMAND AND PRODUCTION INCREMENTAL GLOBAL ALUMINIUM DYNAMICS¹ DEMAND STRUCTURE BY END-USE IN 2021 33.8Mt Consumer 32.1Mt Other 33.0Mt31.9Mt 33.9Mt durables 4% 30.3Mt 6% Machinery & 14.1 Equipment Transport 15.0 10% 12.3 39% Ele
Slide 22: Aluminium Prices Reflect Current Market Fundamentals and Supply Chain Restrictions
ALUMINIUM PRICES REFLECT CURRENT MARKET FUNDAMENTALS AND SUPPLY CHAIN RESTRICTIONS LME CASH SETTLEMENT PRICE REGIONAL PREMIUMS DYNAMICS $/t $/t Monthly average, Aug 2021 (1-9) $3 000 $800 $753 Europe DU $700 $2 500 US MidWest DP $600 Main Japanese Ports (quarterly) $2 000 $500 $1 500 $400 $297 $300
Slide 23: Chinese Production Is Forecasted to Reach Record Highs
CHINESE PRODUCTION IS FORECASTED TO REACH RECORD HIGHS CHINESE INSTALLED ALUMINUM CAPACITY CHINESE PRIMARY ALUMINIUM IMPORT mn t kt Capacity cap 45mn t Imports Exports Net Imports 370 377 42.6 346 42.3 296 270 243 251 230 238 200 204 170 172 41.0 147 134 103 70 2019 2020 2021E -30 Jun-20 Sep-20 Dec-
Slide 24: Appendix
APPENDIX nm RUSAL 24
Slide 25: Key Operating and Financial Data
KEY OPERATING AND FINANCIAL DATA GROUP OPERATING HIGHLIGHTS GROUP FINANCIAL HIGHLIGHTS 1H21 1H20 2H20 1H21 1H20 2H20 Revenue, $mn 5,449 4,015 4,551 Aluminium production (kt) 1,868 1,867 1,888 EBITDA, $mn¹ 1,315 219 652 Aluminium sales (kt) 2,000 1,890 2,036 margin (%) 24.1% 5.5% 14.3% Aluminium av r
Slide 26: Aluminium Segment Operating Data
ALUMINIUM SEGMENT OPERATING DATA ALUMINIUM PRODUCTION kt 1 831 1 875 1 871 1 882 1 867 1 891 1 867 1 889 1 868 2 000 63 66 59 63 58 57 60 61 61 1 800 41 54 42 55 70 71 71 69 65 1 600 1 400 1 200 1 000 1 729 1 758 1 763 1 768 1 734 1 762 1 739 1 760 1 742 800 600 400 200 0 1H17 2H17 1H18 2H18 1H19 2H
Slide 27: Alumina Segment Operating Data
ALUMINA SEGMENT OPERATING DATA PRODUCTION kt Bauxite 8 000 7 567 8 073 7 974 7 469 7 369 7 637 7 000 Alumina 6 281 Nepheline ore 6 000 3 018 3 742 3 463 3 684 3 750 3 843 5 000 3 851 4 007 4 022 4 160 4 102 1 993 3 816 3 957 205 159 214 234 210 4 000 22 154 254 656 739 651 761 252 243 232 81 249 218
Slide 28: Income Statement and EBITDA Reconciliation
INCOME STATEMENT AND EBITDA RECONCILIATION INCOME STATEMENT $ mn 1H21 1H20 2H20 Revenue 5,499 4,015 4,551 Cost of sales (3,819) (3,520) (3,592) Other operating expenses (688) (601) (574) Operating income (Results from operating activities) 942 (106) 385 Net finance expense (444) (125) (414) Other in
Slide 29: Balance Sheet and Cash Flow
BALANCE SHEET AND CASH FLOW BALANCE SHEET 1H21 1H20 2H20 $ mn Cash and Cash Equivalents 3,766 2,096 2,229 Inventory 2,714 2,392 2,292 Trade and other accounts receivables 1,437 1,157 1,163 Equity Attributable to Shareholders of the Company 9,340 5,978 6,543 Trade and other accounts payable 2,052 1,5
Slide 30: Aluminium Segment EBITDA Reconciliation
ALUMINIUM SEGMENT EBITDA RECONCILIATION Other non-production Alumina costs and margin on Total Aluminium and Aluminium segment other intra-group Aluminium 1H21 alloys produced purchased margin services segment $ mn (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Revenue kt 1,853 217 - -
Slide 31: Net Income Reconciliation
NET INCOME RECONCILIATION RECONCILIATION OF ADJUSTED NET PROFIT/(LOSS) 1H21 1H20 2H20 $ mn Net profit/(loss) for the period 2,018 (124) 883 Adjusted for: Share of profits and other gains and losses attributable to Norilsk (1,124) 13 (943) Nickel, net of tax effect, with Change in the fair value of d
Slide 32: UC RUSAL Contacts
www.rusal.com UC RUSAL UC RUSAL Hong Kong Office www.rusal.ru/en/investors/ Gleb Diachkov-Gertcev, Karen Li, CFA Head of Investor Relations Head of the Hong Kong Office 1 Vasilisy Kozhinoi St., Karen.li@rusal.com 121096, Moscow, Russia Phone: +852 3915 8798 InvestorRelations@rusal.com Phone: +7 (495