Slide 1: Another excellent quarter, built on strong operational performance
Another excellent quarter, built on strong operational performance Outokumpu Q1 2022 results Heikki Malinen, President & CEO Pia Aaltonen-Forsell, CFO May 5, 2022
Slide 2: Disclaimer
Disclaimer This presentation contains, 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 to it on t
Slide 3: Solid performance continued despite of increased uncertainty
Solid performance continued despite of increased uncertainty Heikki Malinen, President & CEO
Slide 4: Adjusted EBITDA EUR 377 million
Adjusted EBITDA • Successful actions taken to manage costs increased to and mitigate COVID-19 impacts EUR 377 million • Capacity utilization remained high despite of • Realized stainless steel prices strengthened uncertainty caused • Energy costs competitive by Russia’s invasion • Strong safety perf
Slide 5: The end of the first phase of the strategy is approaching, significant de-leveraging reached
The end of the first phase of the strategy is approaching, significant de-leveraging reached Phase 3: 2026– OUR VISION Phase 2: 2023–2025 Customer’s Phase 1: Investing in growth and first choice in sustainability 2021–2022 sustainable Targeted productivity investments to improve stainless steel Marg
Slide 6: EUR 237 million run-rate EBITDA improvement
• Continued focus on consumables Diligent strategy consumption efficiency to mitigate execution has inflationary pressure brought • Cost & Capital Discipline stream – increasing capacities and efficiencies to EUR 237 million supply strong market demands run-rate EBITDA • Commercial Excellence stream
Slide 7: Strong focus on safety remains, important steps taken towards our SBTi 1.5ºC emission reduction target
Strong focus on safety remains, important steps taken towards our SBTi 1.5ºC emission reduction target Safety performance, TRIFR Sustainability highlights in Q1 2022 8.7 • Safety performance further strengthened 4.4 4.1 • Energy efficiency improved from 2021 3.2 2.4 2.0 1.7 • Two 10-year wind power
Slide 8: We supply sustainable stainless steel to Harvia
We supply sustainable stainless steel to Harvia Harvia produces annually 200,000 sauna stoves to more than 80 countries. Harvia’s production facility in Muurame has used Outokumpu’s stainless steel exclusively since 2017. Stainless steel in Harvia’s products has 70% smaller carbon footprint than oth
Slide 9: European & US transaction spot prices increased further, while nickel prices were volatile
Nickel, USD/tonne European & US transaction 31,400 spot prices increased further, 26,400 21,400 while nickel prices were 16,400 11,400 volatile and FeCr benchmark 6,400 price reached all-time high 1,400 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2017 2018 2019 2020 2021 2022 Tran
Slide 10: Adjusted EBITDA rose to EUR 377 million
Adjusted EBITDA rose to EUR 377 million – higher realized stainless steel prices overcompensated the increase in costs Deliveries, kt Adjusted EBITDA quarter-on-quarter comparison1, EUR million Metal hedging losses due Deliveries increased to LME trading disruption Cost inflation 647 626 by 10% due
Slide 11: Outokumpu strongly condemns the military actions Russia has taken in Ukraine
Outokumpu strongly condemns the military actions Russia has taken in Ukraine and has decided to stop all business operations related to Russia as soon as possible • Outokumpu is not currently procuring any recycled steel of Russian origin. A limited amount of other raw materials is procured from Rus
Slide 12: Successful cost and risk management actions taken throughout the quarter
Successful cost and risk management actions taken throughout the quarter Pia Aaltonen-Forsell, CFO
Slide 13: Strong balance sheet is crucial for a company operating in a cyclical business
• Net debt reduced by EUR 114 million to Strong balance EUR 294 million sheet is crucial • Gearing declined to 9.0% for a company • Total liquidity amounted to EUR 1.3 billion operating in a • Dividend of EUR 68 million paid in April cyclical business • Increased importance of risk management • Pres
Slide 14: Another quarter with strong financials
Another quarter with strong financials Key figures Q1/22 Q1/21 Q4/21 2021 1,000 Stainless steel deliveries 647 608 586 2,395 tonnes Sales EUR million 2,760 1,673 2,215 7,709 Adjusted EBITDA EUR million 377 177 326 1,021 • Net result EUR 251 million Net result EUR million 251 82 159 553 • Net debt to
Slide 15: Strategy execution: Cumulative EUR 237 million realized EBITDA run-rate improvement
Strategy execution: Cumulative EUR 237 million realized EBITDA run-rate improvement achieved by the end of Q1 Gross annualized EBITDA run-rate improvement Solid implementation pipeline by the end of 2022, EUR million 250 Realized 40 50 557 Illustrative plan 35 Initiatives in Target progress 39 1,235
Slide 16: BA Europe – Strong pricing and mitigation actions more than offset cost inflation
Europe’s stainless steel deliveries, 1,000 tonnes BA Europe – 500 Strong pricing and 440 380 391 356 338 356 401 410 355 370 414 mitigation actions more 320 than offset cost inflation 260 200 Q1 Q2 Thank you! Q3 Q4 Q1 Q2 Q3 Q4 Q1 2020 2021 2022 Highlights in Q1 2022 Europe’s adjusted EBITDA, EUR mil
Slide 17: BA Americas – Strong market conditions continued to support profitability
Americas’ stainless steel deliveries, 1,000 tonnes BA Americas – Strong market 290 230 192 194 180 185 168 176 148 conditions continued to 170 134 136 Thank you! 110 support profitability 50 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2020 2021 2022 Americas’ adjusted EBITDA, EUR million Highlights in Q1 2022 120 •
Slide 18: BA Ferrochrome – Strong result in a tight supply-demand situation
Ferrochrome production, 1,000 tonnes BA Ferrochrome – 170 Strong result in a 136 131 131 128 129 123 127 125 130 112 tight supply-demand 90 50 Thank you! situation Q1 Q2 2020 Q3 Q4 Q1 Q2 2021 Q3 Q4 Q1 2022 Ferrochrome’s adjusted EBITDA, EUR million Highlights in Q1 2022 120 • Production increased by
Slide 19: BA Long Products – successful turnaround program delivers, best result in history
Long Products’ stainless steel deliveries, BA Long Products – 1,000 tonnes successful turnaround 80 61 40 43 65 67 53 65 71 program delivers, best 40 31 result in history 0 Q1 Q2 Thank you! Q3 Q4 Q1 Q2 Q3 Q4 Q1 2020 2021 2022 Long Products’ adjusted EBITDA, EUR million Highlights in Q1 2022 24 20 15
Slide 20: Increasing prices and higher volumes resulted in further investment in net working capital
Increasing prices and higher volumes resulted in further investment in net working capital Q1/22 cash flow, EUR million Annual capex, EUR million 240 CapEx limited to €180 million 200 160 120 80 40 0 2021 2022 EBITDA Working Provisions, Operating Net cash Cash flow Expansion, digitalization & other
Slide 21: Leverage decreased to 0.2x as a result of strong business performance
Leverage decreased to 0.2x as a result of strong business performance Net debt, EUR million Net debt/LTM adjusted EBITDA 69% IFRS16 impact* 1,155 2,000 70% 51% 60% 1,600 40% 45% 45% 44% 50% 1,200 40% 800 30% 13% < 3.0 20% 400 9% 10% 1,610 1,242 1,091 1,241 1,155 1,028 9.8 4.0 1.7 2.6 4.4 4.1 0.2 0 4
Slide 22: Strong momentum to Q2 continues
Strong momentum to Q2 continues Heikki Malinen, President & CEO
Slide 23: Outlook for Q2 2022
Group stainless steel deliveries in the second quarter are expected to remain at a similar level compared to the first quarter. The European ferrochrome benchmark price further increased to USD 2.16/lb for the second quarter. Outlook for With current raw material prices, significant raw material-rel
Slide 24: Thank you! Questions & answers
Thank you! Questions & answers
Slide 25: Our efforts in sustainability have been globally recognized
Our efforts in sustainability have been globally recognized 25 | May 5, 2022
Slide 26: BA Europe's adjusted EBITDA increased to EUR 193 million in the first quarter of 2022
BA Europe’s adjusted EBITDA increased to EUR 193 million in the first quarter of 2022 Adjusted EBITDA, EUR million Adjusted EBITDA quarter-on-quarter comparison1, EUR million 193 149 161 98 78 Net of Q1/21 Q2 Q3 Q4 Q1/22 Pricing Q4/21 Deliveries timing and Costs Other Q1/22 & mix hedging 1) Indicati
Slide 27: BA Americas' adjusted EBITDA amounted to EUR 90 million in the first quarter of 2022
BA Americas’ adjusted EBITDA amounted to EUR 90 million in the first quarter of 2022 Adjusted EBITDA, EUR million Adjusted EBITDA quarter-on-quarter comparison1, EUR million 95 90 84 65 54 Net of Q1/21 Q2 Q3 Q4 Q1/22 Pricing Q4/21 Deliveries timing and Costs Other Q1/22 & mix hedging 1) Indicative c
Slide 28: BA Ferrochrome's adjusted EBITDA amounted to EUR 79 million in the first quarter of 2022
BA Ferrochrome’s adjusted EBITDA amounted to EUR 79 million in the first quarter of 2022 Adjusted EBITDA, EUR million Adjusted EBITDA quarter-on-quarter comparison1, EUR million 73 79 67 64 42 Q1/21 Q2 Q3 Q4 Q1/22 Q4/21 Ferrochrome Costs Other Deliveries Q1/22 price 1) Indicative columns based on ma
Slide 29: BA Long products' adjusted EBITDA increased to EUR 24 million in the first quarter
BA Long products’ adjusted EBITDA increased to EUR 24 million in the first quarter of 2022 Adjusted EBITDA, EUR million Adjusted EBITDA quarter-on-quarter comparison1, EUR million 24 15 11 12 9 Net of Q1/21 Q2 Q3 Q4 Q1/22 Pricing Q4/21 Deliveries timing and Costs Other Q1/22 & mix hedging 1) Indicat
Slide 30: Imports into Europe increased significantly during the first quarter of 2022
Imports into Europe increased significantly during the first quarter of 2022 despite stricter trade measures, while imports into US decreased slightly Third-country cold rolled imports1 into Europe, Third-country cold rolled imports2 into the US, 1,000 tonnes 1,000 tonnes Import penetration Import p