Nyrstar Nv · EURONEXT:NYR
Nyrstar Nv — H1 2017 Earnings Presentation
24 slides from Nyrstar Nv's earnings presentation, Aug 2, 2017
Slide 1: First Half 2017 Results
2 AUGUST 2017 First Half 2017 Results
Slide 2: Important Notice
Important Notice This presentation has been prepared by the management of Nyrstar NV (the "Company"). It does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the Company or any
Slide 3: Hilmar Rode, Chief Executive Officer
Electrolysis circuits at Hobart Hilmar Rode Chief Executive Officer 3
Slide 4: Overview of H1 2017
Overview of H1 2017 • Substantial progress at Port Pirie Redevelopment; on track for hot commissioning to commence in late September 2017 with first feed of new TSL furnace in October 2017 and cost to complete of approximately AUD 660 million in-line with revised guidance provided in February 2017 •
Slide 5: Fundamentals remain positive
Fundamentals remain positive Zinc • Zinc outperformed the base metals complex in H2 2016 and was relatively volatile during H1’17, regaining its positive momentum in June 2017 • Exchange stocks of zinc at the end of H1 2017 on the LME and SHFE are at their lowest levels since Q1 2009 FX • Average US
Slide 6: Stable safety performance, solid zinc metal and mine production
Stable safety performance, solid zinc metal and mine production Safety, Health & Environment Lagging Safety Indicators3 • Preventing harm is a core priority of Nyrstar 9.3 • LTIR of 1.8 in H1’17 has been maintained at a 8.0 8.0 7.9 similar rate to that achieved in H1’16 of 1.7 6.4 6.1 • No environme
Slide 7: Chris Eger, Chief Financial Officer
Budel Zinc Chris Eger Chief Financial Officer 7
Slide 8: Financial summary
Financial summary Underlying EBITDA (€’m) 111 105 90 €m H1-164 H1-17 ∆ ∆% Revenue 1,321 1,806 485 37% 117 117 MP U. EBITDA 104 117 13 13% Metals Processing 104 Mining U. EBITDA 1 15 14 1,400% Mining1 Other U. EBITDA (15) (22) (7) 47% 1 7 15 Other (20) (22) Group Underlying EBITDA 90 111 21 23% (15)
Slide 9: Group underlying EBITDA – H1 2017 on H1 2016
Group underlying EBITDA – H1 2017 on H1 2016 (€m) Macro Metals Processing Mining +€86m €(38)m €(22)m 138 4 (41) 14 Other (15) 12 USD (40)TC (8) AUD (1) Other (16) 124 Zinc Group (22) 2 €111m Group (24) €90m (6) 111 117 MP MP 104 Mining 1 Mining 15 Other (15) (22) Other H1’16 Metal Strategic FX TC ra
Slide 10: Net Debt evolution over Q2 2017
Net Debt evolution over Q2 2017 €m (1,272) Zn Prepay & Perp Notes (1,243) 29 0 Net Debt (286) (286) (257) (21) (39) 37 18 (62) 13 54 • PPR €(31)m 986 • Perp Note 0m • MP Growth €(8)m 1243 (986) (986) (986) (286) Net Debt Group Sustaining Interest & Net Growth Working Change Other Net Debt Change in
Slide 11: Balance sheet substantially strengthened in H1 2017
Balance sheet substantially strengthened in H1 2017 Solid financial position Committed liquidity at the end of H1 2017 • Diversified sources of funding backed by broad €m Capacity Drawn Available banking syndicate SCTF Facility 500 (146) 354 • EUR 400m Bond Offering in March 2017 has KBC Facility 50
Slide 12: Hilmar Rode, Chief Executive Officer
Hilmar Rode Port Pirie Redevelopment Chief Executive Officer 12
Slide 13: Port Pirie Redevelopment in-line with revised schedule and budget
Port Pirie Redevelopment in-line with revised schedule and budget • Project comprehensively reviewed at the start of Q1’17 – business case confirmed • Re-work of modules and enhanced slag tapping arrangements being implemented • Agreement with Glencore for training of Nyrstar personnel at Kazzinc le
Slide 14: North American mines being optimised for free cash flow
North American mines being optimised for free cash flow • Sale of Latin American Mining assets expected to be completed in coming weeks • Middle Tennessee mines restart is ahead of schedule with first zinc in concentrate production of 5kt during Q2’17 • Myra Falls mine restart approved with actions
Slide 15: 2017 Strategic priorities remain consistent to transform the business
2017 Strategic priorities remain consistent to transform the business 1 Reinforcing our strong safety culture and improving visible safety leadership across the Company 2 Progress the Port Pirie Redevelopment with hot commissioning to commence by end September 2017 and first feed of new TSL furnace
Slide 16: Questions
Questions
Slide 17: H1 2017 underlying EBITDA sensitivity
H1 2017 underlying EBITDA sensitivity H1 2017 Estimated annual H1 2017 underlying EBITDA impact (€’m) Change Parameter average +/-10% Metals price/rate Processing Mining Group EUR:USD* 1.08 -/+ 10% +83 (68) +19 (15) +101 (83) Zinc price $2,690/t -/+ 10% (34) +45 (18) +18 (52) +63 Zinc Base (25) +25
Slide 18: Gross profit by metal
Gross profit by metal H1 2016 Metals Processing gross profit by metal1 H1 2017 Metals Processing gross profit by metal1 €408m1 €456m1 Zinc (€325m, 72%) Zinc (€414m, 81%) Lead (€43m, 9%) Lead (€31m, 6%) Sulphuric Acid (€23m, 5%) Sulphuric Acid (€20m, 4%) Leach product (€15, 3%) Leach product (€6, 1%)
Slide 19: Debt, working capital facilities, prepays, perpetual securities overview
Debt, working capital facilities, prepays, perpetual securities overview Outstanding balances at 30 Jun 2017 (€m) Aggregate maturity / anticipated amortisation profile €m Maturity €28m €20m Perpertual Securities Structural Debt All Prepays 2018 Convertible Bond 91 Sept 2018 KBC 2019 High Yield Bond
Slide 20: Underlying EBITDA to Net Loss reconciliation
Underlying EBITDA to Net Loss reconciliation €m H1 2016 H1 2017 ∆ Underlying EBITDA 90 111 21 Embedded derivatives (4) (2) 2 Restructuring expense (1) (1) - M&A related transaction expense (1) 0 1 Result on the disposal of subsidiaries (0) (2) (2) Other income - 7 7 Underlying adjustments (6) 2 8 Un
Slide 21: Metals Processing
Metals Processing MP Capex (EURm) Zinc production (kt) MP EBITDA (EURm) 140 118 119 30 67 66 117 117 35 507 508 518 104 13 10 54 59 42 H1-16 H2-16 H1-17 H1-16 H2-16 H1-17 H1-16 H2-16 H1-17 Port Pirie Redevelopment Sustaining Lead (kt) Growth 95 92 EBITDA of EUR 117m (up 13% on H1’16), due to highe
Slide 22: Mining
Mining Mining EBITDA (EURm) Capex (EURm) Zinc in concentrate production (kt) +13m +3kt 19 0 15 0 9 15 53 8 50 6 7 0 11 3 6 46 3 1 H1-16 H2-16 H1-17 H1-16 H2-16 H1-17 H1-16 H2-16 H1-17 Growth Exploration & Development Sustaining EBITDA of EUR 15m in H1’17, up EUR 14m on H1’16, due to higher zinc pr
Slide 23: 2017 guidance
2017 guidance Production Capex 2016 2017 2016 2017 €’m Actual Guidance Actual Guidance Metals Processing Zinc (kt) 1,015 1,000 – 1,100 Metals Processing 236 205 – 255 Sustaining 97 100 – 135 Mining - metal in concentrate Growth 44 25 – 35 Zinc (kt) 96 115 – 135 Port Pirie Redevelopment 95 80 - 85 Mi
Slide 24: Endnotes
Endnotes 1. All references to EBITDA in the presentation are Underlying EBITDA. Underlying EBITDA is a non-IFRS measure of earnings, which is used by management to assess the underlying performance of Nyrstar’s operations and is reported by Nyrstar to provide additional understanding of the underlyi