Slide 1: Fourth Quarter and Full Year 2022 Earnings Call
Fourth Quarter and Full Year 2022 Earnings Call February 22, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements contained in this presentation may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. This presentation may contain “forward-looking statements” with respect to our business, results of opera
Slide 3: Non-GAAP Measures
Non-GAAP Measures This presentation includes information regarding certain non-GAAP financial measures, including VAR, Adjusted EBITDA, Adjusted EBITDA per metric ton, Free Cash Flow, NOPAT, Invested Capital, ROIC and Net debt. These measures are presented because management uses this information to
Slide 4: Jean-Marc Germain, Chief Executive Officer
Jean-Marc Germain Chief Executive Officer
Slide 5: Safety is Our Top Priority
Safety is Our Top Priority Recordable Case Rate(1) Our Changchun operation completed 3 million hours without a recordable case in 2022 Muscle Shoals, Neuf Brisach, Ravenswood, Singen (P&ARP) and Valais (AS&I) each completed 1 million hours without a recordable case in 2022 12 sites finished 2022 wit
Slide 6: Q4 2022 Highlights
Q4 2022 Highlights Shipments: 368kt (-5% YoY) Adjusted EBITDA Bridge in millions Revenue: 1.8 billion (+8% YoY) Value-Added Revenue: 696 million (+18% YoY) Net income: 30 million Adjusted EBITDA: 148 million (+1% YoY) Cash from Operations: 128 million ï Free Cash Flow: 22 million Strong Q4 results d
Slide 7: FY 2022 Highlights
FY 2022 Highlights Adjusted EBITDA Bridge in millions ïƒ Shipments: 1.6 million tons (+1% YoY) Revenue: 8.1 billion (+32% YoY) +16% Value-Added Revenue: 2.7 billion (+21% YoY) Net income: 308 million Adjusted EBITDA: 673 million (+16% YoY) Record Adj. EBITDA in A&T and AS&I Net Debt / LTM Adjusted E
Slide 8: Peter Matt, Chief Financial Officer
Peter Matt Chief Financial Officer
Slide 9: Value-Added Revenue Bridges
Value-Added Revenue Bridges Q4 2022 vs. Q4 2021 millions +18% FY 2022 vs. FY 2021 millions +21% Fourth Quarter 2022 – Earnings Call 9
Slide 10: Packaging & Automotive Rolled Products Q4 2022 Performance
Packaging & Automotive Rolled Products Q4 2022 Performance Q4 Q4 Adjusted EBITDA of 71 million 2022 2021 % Higher automotive shipments; lower Shipments (kt) 254 272 (7)% packaging and specialty shipments Improved price and mix Revenue ( m) 1,008 1,037 (3)% Higher operating costs due to inflation and
Slide 11: Aerospace & Transportation Q4 2022 Performance
Aerospace & Transportation Q4 2022 Performance Q4 Q4 Adjusted EBITDA of 56 million 2022 2021 % Higher aerospace shipments; lower TID Shipments (kt) 53 53 —% shipments Improved price and mix (including 8M Revenue ( m) 422 321 32% customer contractual payment) Adj. EBITDA ( m) 56 30 87% Higher operati
Slide 12: Automotive Structures & Industry Q4 2022 Performance
Automotive Structures & Industry Q4 2022 Performance Q4 Q4 Adjusted EBITDA of 31 million 2022 2021 % Higher automotive shipments; lower Shipments (kt) 61 60 1% industry shipments Revenue ( m) 428 362 19% Improved price and mix Higher operating costs mainly due to Adj. EBITDA ( m) 31 31 0% inflation
Slide 13: Managing the Current Inflationary Environment
Managing the Current Inflationary Environment Cost Pressures and Mitigants Addressing Inflationary Pressures Broad based and significant inflationary Adjusted EBITDA Bridge pressures throughout 2022; expected to (2022 vs. 2021) continue throughout 2023 millions – Metal supply remains tight – Higher
Slide 14: Energy Costs Update
Energy Costs Update Group energy costs of ~ 275M in 2022 France Electricity (Baseload)(1) – Up from 2019-2021 average of /MWh ~ 150M 2023 energy largely secured, but at higher average prices Forward energy prices in Europe have declined in recent months but remain 3x ~3.5x or more above historical a
Slide 15: Free Cash Flow
Free Cash Flow 2022 Free Cash Flow Highlights FY 2022 FY 2021 in millions Record Free Cash Flow of 182 million Net cash flows from 451 357 Strong Adjusted EBITDA operating activities Lower cash interest Purchases of property, Higher capital expenditures and cash plant and equipment, (269) (222) taxe
Slide 16: Net Debt and Liquidity
Net Debt and Liquidity Net Debt and Leverage Debt / Liquidity Highlights in millions Leverage at .8x, multi-year low 2 a Despite 64 million FX impact on debt Expect leverage to continue to decline No near-term bond maturities Strong liquidity position Leverage: Net Debt / LTM Adjusted EBITDA Maturit
Slide 17: Jean-Marc Germain, Chief Executive Officer
Jean-Marc Germain Chief Executive Officer
Slide 18: End Market Updates
End Market Updates A Diversified Platform Market Commentary • Some short term inventory adjustments in both North America LTM Revenue by End Market and Europe, but market backdrop remains strong • Focus on sustainability driving increased demand for aluminium Packaging cans • Mid-single digit long-t
Slide 19: Investing in Our Future...Today
Investing in Our Future...Today Our performance across varying business conditions and our strong financial position give us confidence to continue investing – The incremental growth capex of ~€75M per year in 2023-2025 is manageable – Expect to continue to generate strong FCF through the investment
Slide 20: Key Messages and Guidance
Key Messages and Guidance Strong performance in 2022 – Record Adjusted EBITDA and Free Cash Flow despite a number of challenges including significant inflationary Targets pressures 2023 Adjusted EBITDA: – Solid operational performance and strong cost control €640 to €670 million – Leverage at 2.8x a
Slide 21: Appendix
Appendix Fourth Quarter 2022 – Earnings Call 21
Slide 22: VAR Reconciliation
VAR Reconciliation Three months ended Year ended December 31, December 31, (in millions of Euros) 2022 2021 2022 2021 Revenue 1,844 1,706 8,120 6,152 Hedged cost of alloyed metal (1,212) (1,067) (5,403) (3,684) Revenue from incidental activities (5) (5) (21) (20) Metal time lag 69 (43) 29 (187) VAR
Slide 23: Reconciliation of Net Income to Adjusted EBITDA
Reconciliation of Net Income to Adjusted EBITDA Three months ended Year ended December 31, December 31, (in millions of Euros) 2022 2021 2022 2021 Net income 30 7 308 262 Income tax (benefit) / expense (3) 2 (105) 55 Income before tax 27 9 203 317 Finance costs—net 33 41 131 167 Income from operatio
Slide 24: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation Three months ended Year ended December 31, December 31, (in millions of Euros) 2022 2021 2022 2021 Net cash flows from operating activities 128 118 451 357 Purchases of property, plant and equipment, (106) (104) (269) (222) net of grants received Free Cash Flow 22 14 18
Slide 25: Net Debt Reconciliation
Net Debt Reconciliation December 31, September 30, June 30, March 31, December 31, (in millions of Euros) 2022 2022 2022 2022 2021 Borrowings 2,056 2,169 2,158 2,138 2,129 Fair value of net debt derivatives, net of margin 1 (1) (5) (1) (1) calls Cash and cash equivalents (166) (171) (156) (160) (147
Slide 26: Reconciliation of Net Income to Adjusted EBITDA
Reconciliation of Net Income to Adjusted EBITDA Twelve months ended December 31, September 30, June 30, March 31, December 31, (in millions of Euros) 2022 2022 2022 2022 2021 Net income 308 285 253 393 262 Income tax (benefit) / expense (105) (100) 57 83 55 Income before tax 203 185 310 476 317 Fina
Slide 27: Reconciliation of Net Income to NOPAT and ROIC
Reconciliation of Net Income to NOPAT and ROIC Year ended December 31, (in millions of Euros) 2022 2021 Net income 308 262 Income tax (benefit) / expense (105) 55 Income before tax 203 317 Finance costs—net 131 167 Income from operations 334 484 Unrealized losses / (gains) on derivatives 46 (35) Unr
Slide 28: Borrowings Table
Borrowings Table At December 31, At December 31, 2022 2021 Nominal Nominal Value in Nominal Value in (Arrangement Accrued Carrying Carrying (in millions of Euros) Currency Rate Euros fees) Interests Value Value Secured Pan-U.S. ABL $ 85 Floating 80 — 1 81 —(due 2026) Secured PGE French Facility € 18