Outokumpu Oyj · OMXHEX:OUT1V
Outokumpu Oyj — Investor Day (May 2013)
20 slides from Outokumpu Oyj's investor day presentation, May 22, 2013
Slide 1: Outokumpu Capital Markets Days 2013
Outokumpu Capital Markets Days 2013 May 22-23, 2013 Old Billingsgate, London, UK
Slide 2: Disclaimer
Disclaimer The following presentations contain, or may be deemed to contain, statements that are not historical facts but forward- looking statements. Such forward-looking statements are based on the current plans, estimates and expectations of Outokumpu’s management based on information available t
Slide 3: CEO's opening remarks
CEO’s opening remarks Outokumpu Experience Mika Seitovirta 2013 CEO Outokumpu May 22-23, 2013 Old Billingsgate, London, UK
Slide 4: Economic uncertainty in Europe continues
Economic uncertainty in Europe continues Region GDP % GDP % Industrial Industrial Stainless Stainless 2012 2013 production production steel % steel % % 2012 % 2013 2012 2013 Europe1) ‐0.3 ‐0.2 ‐2.1 ‐1.2 ‐2.8 ‐1.1 China 7.8 8.2 10.0 11.3 5.4 6.8 NAFTA 2.3 2.1 3.6 1.9 4.4 2.5 Global 2.4 2.4 3.7 4.7 2.
Slide 5: Nickel price decline has affected negatively our performance
Nickel price decline has affected negatively our performance Nickel price: Jan 2011 – May 2013 CEO’s opening remarks, Mika Seitovirta 5/22/2013 5
Slide 6: Challenging market environment has resulted in weak financial performance
Challenging market environment has resulted in weak financial performance Q1/13 Q4/12 EUR million comparable Sales 2,221 2,067 EBIT, underlying 1) -77 -162 Net interest-bearing debt (end of period) 2,891 2,620 Equity (end of period) 2,799 2,952 Debt-to-equity ratio (gearing), % (end of period) 103.3
Slide 7: New Outokumpu
New Outokumpu New Outokumpu 2012 Sales 1,2) • Outokumpu is the new global leader in stainless steel and high performance alloys • 16,000 employees with state-of-the-art EUR 9,400 million production facilities as well as broad service center and sales office presence globally • Broadest product portf
Slide 8: Strategic long term considerations for Outokumpu
Strategic long term considerations for Outokumpu Geographical Forward Backward Product focus Consolidation focus integration integration • Focus on • Market leader in • An extensive • Own chrome • Acquisition of stainless steel Europe Service Center mine Inoxum in 2012 and on high • Target to reach
Slide 9: Industry demand-supply balance: Capacity utilization to improve by 2017
Industry demand-supply balance: Capacity utilization to improve by 2017 Stainless steel industry Cold Rolling capacity utilization by region 90% 80% 70% EMEA 60% APAC Americas 50% 40% 30% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Source: CRU February 2013, Outokumpu company estimates CE
Slide 10: Our planned capacity reductions will result in higher utilization rates
Our planned capacity reductions will result in higher utilization rates in the coming years 5,000 4,500 1,400 Capacity reduction 4,000 Balance for 3,500 hot and cold 3,000 325 Plate & Long 2,500 Cold rolled 1) 2,000 Melting 2) 3,500 1,500 2,795 1,000 500 0 Melting Finished products 1) Sales of least
Slide 11: Our planned capacity reductions will result in high utilization rates
Our planned capacity reductions will result in high utilization rates in the coming years 5,000 4,500 1,400 Capacity reduction 4,000 Balance for 3,500 hot and cold 3,000 325 Plate & Long 2,500 Cold rolled 1) Possible reductions in 2,000 cold rolling capacity in Melting 2) 3,500 1,500 Europe being ev
Slide 12: Remedy divestment process timeline extended
Remedy divestment process timeline extended • EU Commission has required Outokumpu to divest the integrated stainless mill in Terni, Italy as well as Outokumpu’s service center in Germany and Terninox service center in Italy, and optionally certain selected service centers in Europe. • We are workin
Slide 13: New Outokumpu Strategy Roadmap
New Outokumpu Strategy Roadmap Restructuring + Growth = Perfor- mance New Transform Ensure Ramp-up Full integration Deliver on Expand Leverage Develop efficiency company financial US Ferrochrome and new synergies HPSA APAC culture projects structure stability presence Mill closures P150 project New
Slide 14: Balanced customer base across industries
Balanced customer base across industries Sales by customer segment Sales by end‐customer segment Healthy balance between end-customer segments across both investment and consumer driven industries Other Consumer Distributors 12 % goods & Medical 41% Heavy 17 % industries 8% Automotive 9% Architectur
Slide 15: Strong customer feedback on key customer priorities
Strong customer feedback on key customer priorities 80 75 70 65 Outokumpu 60 Company A 55 Company B 50 45 40 Product quality Delivery reliability Technical expertise Source: Outokumpu and Inoxum customer survey. 720 stainless customers interviewed in 14 countries in June 2012. CEO’s opening remarks,
Slide 16: Our cultural transformation principles
Our cultural transformation principles From From volumes Working production to Speed to profit together customers Outokumpu Calvert, Alabama Team CEO’s opening remarks, Mika Seitovirta 5/22/2013 16
Slide 17: Management compensation elements well aligned with strategic priorities
Management compensation elements well aligned with strategic priorities Short term incentive • EBITDA • Synergy savings • Inventory days • Capex Long term incentive • EBITDA • Synergies • Share price development CEO’s opening remarks, Mika Seitovirta 5/22/2013 17
Slide 18: We offer sustainable materials
We offer sustainable materials Sustainability sets the basis for our long‐term competitiveness and future growth and it is embedded in our products and operations: 1. 80% recycling content compared to industry average of 60% 2. Product carbon footprint decreased by over 40% in last 15 years 3. EUR 2
Slide 19: Our priorities in 2013
Our priorities in 2013 High quality service to the new Outokumpu Customer customers globally Implementation of the planned synergy benefits Synergy savings of EUR 200 million in full Calvert and Successful ramp-up of Calvert, US integrated mill ferrochrome ramp-up and ferrochrome operations Cash flo
Slide 20: Q&A
Q&A Outokumpu Experience 2013 May 22-23, 2013 Old Billingsgate, London, UK