Aurubis Ag · XETR:NDA
Aurubis — German Corporate Conference, September 2020
55 slides from Aurubis's conference presentation, Sep 22, 2020
Slide 1: Aurubis AG – Metals for Progress
Aurubis AG Metals for Progress
Slide 2: Aurubis is currently only marginally affected by COVID-19 impacts
Aurubis is currently only marginally affected by COVID-19 impacts Employees Production » Group-wide task force meets daily » Production is being maintained at all sites » Strict hygiene measures have been » Safeguarding supply chains implemented group-wide » Isolated concentrate delivery bottlenecks
Slide 3: Agenda
Agenda 1. Aurubis’ market position 2. Copper market 3. Financial data 4. Strategy and outlook September 2020 3
Slide 4: Our metals for an innovative world
Our metals for an innovative world: our copper will enable the trends of the future green energy e-mobility Continuous growth in metal demand expected digitalization urbanization September 2020 4
Slide 5: Metals for progress
Aurubis’ strengths include productivity, efficiency, environmental protection, and processing expertise 28 30 34 45 46 47 Ni Zn Se Rh Pd Ag Copper cathodes Concentrates Smelting and Nickel sulfate refining Selenium Sulfuric acid 50 82 79 78 75 52 Sn Pb Au Pt Re Te Further Scrap/ processing intermedi
Slide 6: Production volumes and metal portfolio
Production volumes and metal portfolio FY 2018/19 Position FY 2018/19 Concentrate 2,225,000 t No. 4 worldwide Gold 51 t processing* Copper scrap input 291,000 t No. 1 worldwide Silver 861 t Cathode output* 1,075,000 t No. 5 worldwide Lead 19,038 t Continuous cast wire 804,000 t No. 3 worldwide Nicke
Slide 7: Aurubis Group production sites
Aurubis Group production sites Production sites » Avellino IT » Mortara IT » Berengo ES » Olen BE » Beerse BE » Pirdop BG » Buffalo US » Pori FI » Dolný Kubín SK » Röthenbach DE » Emmerich DE » Smethwick GB » Fehrbellin DE » Stolberg DE » Hamburg DE » Zutphen NL » Lünen DE » Aurubis has a service an
Slide 8: Environmental compliance is one of Aurubis’ key strengths
Environmental compliance is one of Aurubis’ key strengths and a competitive advantage Primary copper Recycling SO2 emissions of copper smelters (in kg SO2 per t of copper) 600 500 Hamburg site 4 Pirdop site 6 400 Copper smelters: 300 - European avg. 32 200 - International avg. 73 100 Pirdop Hamburg
Slide 9: Sustainability is a fundamental component of the Aurubis strategy
Sustainability is a fundamental component of the Aurubis strategy Aurubis Sustainability Strategy 2018-2023, main sustainability ratings & initiatives 68 of 100 (2018) AA (2018) 74 of 100 (2019) AA (2019) 2020: Gold Gold = the best 5 % of rated companies Best Newcomer (2015) MDAX Leader (2016) Score
Slide 10: Agenda
Agenda 1. Aurubis’ market position 2. Copper market 3. Financial data 4. Strategy and outlook September 2020 10
Slide 11: Our market environment: opportunities and challenges
Our market environment: opportunities and challenges for further development Standard copper Complex Product Societal raw material markets raw material markets markets trends Expansion of mine Increasing metal prices Postponed mine supply UN Sustainable supply and copper foster attractiveness of cou
Slide 12: Global copper demand continues to increase
Global copper demand continues to increase Global demand for refined copper (in million t) China (share in %) ~ 2 %* » China continues to be the most important source 25.1 25.6 of global copper demand (approx. 50 % share) 23.5 23.9 24.5 and a major net importer » Growth potential for copper use is p
Slide 13: The European copper market traditionally shows a cathode deficit
The European copper market traditionally shows a cathode deficit • Expected copper demand by region in 2019 (in million t) • Expected copper surplus/deficit (in million t) -0.8 +1.2 0.4 -0.5 3.6 2.4 -0.5 -3.3 0.8 15.7 +2.3 +1.3 +0.4 0.4 0.2 Total demand in 2019: 23.5 million t Global production in 2
Slide 14: Aurubis copper premium
Aurubis copper premium (in US$/t) 120 110 105 100 96 96 92 86 86 80 60 40 20 0 *2014 2015 2016 2017 2018 2019 2020 * from June 1, 2014: US$ 86/t September 2020 14
Slide 15: Expected copper prices will support mining projects
Expected copper prices will support mining projects Size of deposits Copper price (in million t of copper content) (in US$/t – 3-month quotation) 90 10000 80 9000 70 8000 60 7000 50 Oyu Tolgoi (MN) 6000 Collahuasi (CL) 40 5000 Los Pelambres Expansion (CL) Andina Expansion 30 Los Bronces (CL) 4000 Ex
Slide 16: Expansion of Chinese smelter capacity loses momentum
Expansion of Chinese smelter capacity loses momentum Production of refined copper in China (in million t) ~ 2 %* 10.9 11.1 10.4 ~ 9 %* 9.9 9.1 » Expected production increases will primarily take 8.4 place at a number of existing smelters and be 7.8 moderate for the most part 7 » Low TC/RC level in 2
Slide 17: Increasing production continues to lead to a good concentrate supply
Increasing production continues to lead to a good concentrate supply on the market Origin of copper concentrates (in %) Others Peru 17% 18% Indonesia 4% Canada 4% » First 2020 framework contract between Freeport Bulgaria and Jiangxi Copper for standard concentrates USA 16% 5% with TC/RC of US$ 62/t
Slide 18: Copper in concentrate supply and demand forecast
Copper in concentrate supply and demand forecast Cu concentrate supply by geography Cu concentrate demand by geography (2014-29f, in 1,000 t) (2014-25f, in 1,000 t) 20000 20000 Oceania 15000 15000 Europe North America Africa Asia 10000 10000 Central & South America 5000 5000 0 0 2014 2016 2018 2020f
Slide 19: Very volatile sulfuric acid markets; markets still oversupplied
Very volatile sulfuric acid markets; markets still oversupplied Aurubis sulfuric acid output by sector/industry FY 2018/19 Metals 10 % » At Aurubis, sulfuric acid is a by-product of concentrate processing that is produced during flue gas desulfurization Fertilizers 45 % » ~1 t of sulfuric acid is pr
Slide 20: Copper scrap supply allows for a good refining charge level
Copper scrap supply allows for a good refining charge level Origin of recycling materials (in %) Other Americas 2% » Aurubis processes roughly 700,000 t 12% of recycling materials that contain Eastern Europe copper and different kinds of metal; 10% Germany 291,000 t of this quantity is No. 2 45% cop
Slide 21: Market conditions in first nine months 2019/20
Market conditions in first nine month 2019/20: A mixed and volatile picture Trend in significant market prices and refining charges 140% 100 % = Sept. 2018 120% Copper premium 100% Exchange rate (US$/€) 80% Copper price (settlement) European refining charges 60% for copper scrap no. 2 TC/RCs for cop
Slide 22: Aurubis AG’s sources of earnings
Aurubis AG’s sources of earnings Treatment and refining charge = Mines’ payments to smelters for processing TC/RC copper concentrates into cathodes. Smelters’ central profit driver – primarily influenced by concentrate supply and demand Refining charge = Fee for processing copper scrap, blister, and
Slide 23: Agenda
Agenda 1. Aurubis’ market position 2. Copper market 3. Financial data 4. Strategy and outlook September 2020 23
Slide 24: Executive summary of Q3 2019/20
Executive summary of Q3 2019/20: Aurubis is still only marginally affected by COVID-19 impacts » 9-month result once again reflects a solid profit and stable balance sheet » Operating EBT of € 133 million (PY: € 125 million) » ROCE of 8.5 % (PY: 7.3 %), burdened by the impairments in Q4 2018/19 in S
Slide 25: Gross profit demonstrates the resilience of the Aurubis business model
Gross profit demonstrates the resilience of the Aurubis business model 9M 9M Change vs. prior (operating IFRS) 2019/20 2018/19 year Revenues €m 8,896 8,681 2% Gross profit €m 848 835 2% EBITDA €m 254 234 9% EBIT €m 139 132 5% EBT €m 133 125 6% Consolidated net income €m 103 95 8% September 2020 25
Slide 26: Breakdown of energy costs in the Aurubis Group
Breakdown of energy costs in the Aurubis Group Breakdown of energy costs in the Electricity consumption and CO2 scopes Aurubis Group (9M 2019/20) » Total electricity consumption in the Aurubis Electricity Oxygen Group: approx. 1.7 million MWh (2018) 64% 17% » CO2 emissions of 1.4 million t (2018) Ga
Slide 27: Our ideas to tackle CO2 emissions
Our ideas to tackle CO2 emissions Main projects implemented to reduce CO2 emissions » District heating part 1 in Hamburg (20,000 t CO2) » Power2Steam in Hamburg (up to 4,000 t CO2) » Wind turbine in Olen (~5,800 t) / back-pressure turbine Pirdop (~5,600 t) Ideas to reduce CO2 emissions » District he
Slide 28: Still very robust key figures provide room for future growth
Still very robust key figures provide room for future growth 9M 9M Target 2019/20 2018/19 ROCE* % 8.5 7.3 15.0 Equity ratio % 48.5 52.7 > 40.0 (equity / total liabilities) Debt coverage** 0.7 0.9 < 3.0 9M 9M Additional KPIs 2019/20 2018/19 Capital expenditure €m 163 143 (including finance leases) Ca
Slide 29: Buyback of company’s own shares
Buyback of company’s own shares as acquisition currency and for financing purposes Buyback of up to 10 % of company’s own shares 65 1.400.000 » Volume: up to € 200 million 60 1.200.000 » Period from March 19, 2020 to September 17, 2021 55 1.000.000 Target: to create treasury stock » as acquisition c
Slide 30: Aurubis shareholder structure
Aurubis shareholder structure Listed in the following indices: Dividend yield Payout ratio (in %) (in %, calculated based » MDAX index on operating IFRS consolidated net income) » Global Challenges Index (GCX) 41 3.1 2.6 Shareholder structure July 29, 2020* 28 Salzgitter 2.1 26 Mannesmann 6.99% Silc
Slide 31: Agenda
Agenda 1. Aurubis’ market position 2. Copper market 3. Financial data 4. Strategy and outlook September 2020 31
Slide 32: Our strategic business triad: realizing our purpose
Our strategic business triad: realizing our purpose September 2020 32
Slide 33: Our strategic focus: strengthening copper and developing multi-metal business
Our strategic focus: strengthening of copper business and development of multi-metal business Expanding multi-metal business: strong capabilities & innovative industry solutions Smelting & Refining Complex Technology raw material applications markets Processing markets synergies enabling Standard co
Slide 34: Our strategic focus Growth: development of strong multi-metal capabilities
Our strategic focus Growth: development of strong multi-metal capabilities Approach » Consistent development of multi-metal processing capabilities based on copper as main carrier metal » Development of mine-specific solutions for primary raw materials in close cooperation with suppliers » Developme
Slide 35: Metallo acquisition: focus on integration and synergies
Metallo acquisition: Focus after closing is now on integration and leveraging synergies » Aurubis acquires a technology leader and strengthens its footprint in the processing of non-ferrous recycling materials » Further diversifies Aurubis’ business model towards multi-metal recovery and strengthens
Slide 36: The acquisition strengthens Aurubis’ multi-metal portfolio
The acquisition strengthens Aurubis’ multi-metal portfolio of key metals especially, like copper, nickel, tin, zinc, and lead Aurubis and Metallo increase in metal production compared to current output Copper Gold Silver Lead Nickel PGMs Tin Minor Metals Platinum Selenium Osmium Tellurium Iridium Rh
Slide 37: Production / sales volumes and metal portfolio
The acquisition strengthens Aurubis’ multi-metal portfolio of key metals especially, like copper, nickel, tin, zinc, and lead Production / sales volumes and metal portfolio Aurubis Group thereof Metallo 9M 2019/20 Jun 2020 Recycling input t 234 23 Copper scrap/ t 278 5 blister copper input Copper ca
Slide 38: Metallo purchase price reconciliation
Metallo purchase price reconciliation In € million Cash and cash equivalents 42 Receivables 48 Inventories 135 Property, plant, and equipment 228 Intangible assets 63 Financial liabilities 85 Provisions 15 Deferred tax liabilities (netted) 50 Net identifiable assets acquired 366 plus goodwill 9 Tota
Slide 39: Successful placement of ESG-linked Schuldschein loan
Successful placement of ESG-linked Schuldschein loan (SSD) » Forerunner within the sector: Aurubis is the first European Strong investor appetite company in the basic materials industry with an ESG-linked SSD High oversubscription » It will be used for general company financing as well as for the en
Slide 40: Efficiency improvement/cost reduction program
Efficiency improvement/cost reduction program We have a clear objective: We want to become the most efficient and sustainable integrated smelter network worldwide. Focus on efficiency Ideas will be adjusted and transferred Focus on costs SG&A Full Expanded Non-Metal Procurement P&L effect by scope F
Slide 41: azeti: Digitalization as a key component of the company strategy
azeti: Digitalization as a key component of the company strategy » azeti ensures resources, software, and knowledge in the long term » Aurubis secures the expertise of 20 employees and thus lays the foundation for setting up a digital organization in the company » IoT platform (internet of things) a
Slide 42: Our strategic focus Responsibility: guiding in everything we do
Our strategic focus Responsibility: guiding in everything we do Approach » Sustainability is an integral part of Aurubis’ Group Strategy with a focus on economy, environment, and people » Our expertise of smelting, refining & recycling, as well as the trusting cooperation with business partners and
Slide 43: Sustainability with a focus on economy, environment, and people
Sustainability with a focus on economy, environment, and people Aurubis Sustainability Strategy » Running from 2018 to 2023 » Released September 2018 » Balance of economy, environment, people » 9 action areas » 9 targets » 27 measures » All targets and measures at www.aurubis.com/sustainabilitystrat
Slide 44: Environmental protection: an essential part of the Sustainability Strategy
Environmental protection: an essential part of Aurubis’ Sustainability Strategy Aurubis reduction 2000-2018 SO2 emissions – 4.9 kg/t of copper output -86 % Dust emissions – 63 g/t of copper output -95 % Metal emissions to water – 1.1 g/t of copper output -85 % Water withdrawal – 51 in m³/t of copper
Slide 45: Sustainability Strategy 2018-2023 – selected targets and KPIs
Aurubis Sustainability Strategy 2018-2023 – selected targets and KPIs ENVIRONMENT Year Target Status as at 9/30/2019 Introduction of environmental management in accordance CY 2022 Group-wide 12/16 sites1 with ISO 14001 Introduction of energy management in accordance with FY 2021/22 Group-wide 8/16 s
Slide 46: Aurubis is committed to obtaining the Copper Mark label
Aurubis is committed to obtaining the Copper Mark label » Launched for copper producers in March 2020 » Basis: UN SDGs & Risk Readiness Assessment » Independent assessment every 3 years » Regular review of criteria (evolving system) » Chain of custody later » Focus on steady improvement of the secto
Slide 47: Market outlook for 2019/20
Market outlook for 2019/20 Copper price Reuters poll July: US$ 5,728/t for 2020, US$ 6,228/t for 2021 We anticipate a reduced concentrate supply. Our smelters are Copper supplied until the end of the calendar year with a substantially concentrates lower benchmark. We expect an improving supply in ou
Slide 48: FY 2019/20 forecast again confirmed
FY 2019/20 forecast again confirmed In total, we expect an operating EBT between € 185 and 250 million and an operating ROCE between 8 and 11 % for fiscal year 2019/20. Interval forecast Operating EBT Operating ROCE in € million in % Group 185-250 8-11 Segment MRP 230-310 11-16 Segment FRP -3 - -8 <
Slide 49: Our priorities for 2020
Our priorities for 2020 Keeping our people Operational healthy and safe excellence Metallo integration Additional growth including identifying and leveraging all synergies projects Efficiency improvement / cost Sustainability reduction program September 2020 49
Slide 50: Scheduled shutdowns in the next 3 years
Scheduled shutdowns in the next 3 years Status: May 2020 (preliminary) FY 2019/20 FY 2020/21 FY 2021/22 Hamburg › Boiler repair/inspection › Anode furnace › Boiler repair/inspection Oct./Nov. 2019 Apr. 2021 May/Jun. 2022 EBT effect ca. € 34 million EBT effect ca. € 8 million EBT effect ca. € 21 mill
Slide 51: Aurubis – Metals for Progress
AAurubis Metals for Progress VISION VISION VISION 2025 Ps Passion for metallurgy with you
Slide 52: Your IR Contacts
Your IR Contacts Angela Seidler Elke Brinkmann VP Investor Relations & Senior Manager Corporate Communication +49 40 7883-2379 +49 40 7883-3178 e.brinkmann@aurubis.com a.seidler@aurubis.com Financial Calendar » Annual Report 2019/20 December 9, 2020 September 2020 52
Slide 53: Aurubis at a glance
Aurubis at a glance Company highlights » Based in Hamburg, Aurubis AG is the largest integrated copper producer in Europe and the global market leader in copper recycling with the best available technology » The company’s main expertise is in optimally processing concentrates and recycling raw mater
Slide 54: Primary copper production process
Primary copper production process Sulfuric acid plant Off-gas cleaning Copper scrap Copper concentrates Copper matte Blister copper (64 % Cu) (98 % Cu) Flash smelter Converter Anode furnace Copper Nickel sulfate (99.5 % Cu) Anode Cathode Anode slime Anode Tankhouse casting wheel Precious metal refin
Slide 55: Disclaimer
Disclaimer Forward-looking statements This document contains forward-looking statements that involve risks and uncertainties, including statements about Aurubis’ plans, objectives, expectations, and intentions. Readers are cautioned that forward-looking statements include known and unknown risks and
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