Global Ferronickel Holdings, Inc. · PSE:FNI
Global Ferronickel — FY2018 Earnings Presentation
20 slides from Global Ferronickel's earnings presentation, Mar 22, 2019
Slide 1: FY2018 Analysts' Briefing
Global Ferronickel Holdings, Inc. FY2018 Analysts’ Briefing March 22, 2019
Slide 2: Disclaimer
Disclaimer The information in this presentation has been prepared by Global Ferronickel Holdings, Inc. (“FNI”) and its subsidiaries (together, the “Group”). None of the Group or any of its directors, officers, employees or shareholders shall be in any way liable for the contents hereof. By attending
Slide 3: Discussion Flow
Discussion Flow • Market Review • Demand for Nickel ore remains robust amidst strong demand on stainless steel and electric vehicles • Increase in supply Nickel ore puts negative pressure on price • Operations Review and Financial Highlights • Better product mix due to improvements in the mining ope
Slide 4: 2018 Market Review
2018 Market Review
Slide 5: Increasing Trend of Stainless Steel Production
Increasing Trend of Stainless Steel Production • China’s Stainless Steel production remains robust, increasing by 3.7% year-on-year in 2018, evident on its continuously growing Nickel Ore import • On nickel demand, CRU forecasts a global deficit of 34,000 tonnes in 2019 and 44,000 tonnes in 2020 due
Slide 6: The Growth of Electric Vehicles
The Growth of Electric Vehicles • With the China government’s advocacy to reduce pollution and decrease their dependency on imported fuels, the electronic vehicle industry expects a tremendous growth for the next succeeding years. • According to Vale, with the accelerating growth EV production, Nick
Slide 7: Tempering China Economy
Tempering China Economy China GDP Growth (%) Fixed Asset Investment Growth (%) China Industrial Production YoY Growth (%) China Retail Sales YoY Growth (%) Source: Bloomberg
Slide 8: LME Nickel positioned for recovery
LME Nickel positioned for recovery LME Nickel price shows a continuous recovery since the slump of 2016 as the demand for stainless steel remains strong and as the gap between Nickel demand and supply increases. For early 2019, Nickel price shows a consistent uptrend buoyed by strong demand and dimi
Slide 9: Price jitters in Shanghai Metals
Price jitters in Shanghai Metals Shanghai Metals showed weakness for the whole of 2018 with prices of Nickel laterite ores dropping by 24.9%, year-on-year, based on average price of 1.5% Ni; Fe <20%; 33% water. The drop is price is due to the market’s concern on the imposition of higher tariffs by U
Slide 10: Robust Contribution despite cut in Supply
Robust Contribution despite cut in Supply • Philippines remains to be one of the top Nickel-producers in the world despite local challenges and external competitions. For 2018, Philippine produced 27.09mn DMT of Nickel ore, down by 4.5% year-on-year. • Despite the halt in operations of 10 Nickel min
Slide 11: Operations Overview
Operations Overview
Slide 12: Leveraging on Contractor as Operational Strength
Leveraging on Contractor as Operational Strength Capitalizing on our contractor helps us improve production efficiency without financial burden 2017 2018 Change (%) Total Production (WMT) 6,223,131 6,176,404 (0.8)% Ave Production per Hour (WMT/hour) 1,899 2,136 12.5% Source: Company data
Slide 13: Improvements in Operations as Growth Driver
Improvements in Operations as Growth Driver Average Daily Production Capacity Shipments for the Year WMT WMT Vessels WMT 34,183 vs 39,113 103 5.709 2017 2018 Highest Number of Operating Equipment Diverse Customer Base Equipment Equipment Direct Clients Direct Clients vs 412 2017 vs 607 2018 11 2017
Slide 14: Financial Highlights
Financial Highlights
Slide 15: Flexible Product Offering Boosts Revenue
Flexible Product Offering Boosts Revenue Company’s capacity to shift its sales focus to higher grade ore helped cushion the revenue amidst the softening Nickel price Despite an 8.7% and 18.4% year-on-year decline in the price of medium-grade Nickel ore and low-grade Nickel ore respectively, the comp
Slide 16: Income Statement Analysis
Income Statement Analysis Income Statement (in Php mn) 2017 2018 Change (%) SALE OF NICKEL ORE 5,816 5,487 (5.7)% GROSS PROFIT 3,047 2,824 (7.3)% Gross Profit Margin 52.4% 51.5% OPERATING INCOME 1,111 868 (21.8)% Operating Profit Margin 19.1% 15.8% EBITDA 1,824 1,381 (24.3)% EBITDA Margin 31.4% 25.2
Slide 17: Exploration Updates
Exploration Updates
Slide 18: Exploration Increased Our Reserves and Strengthened Our Confidence in Continuous Mining Operations
Exploration Increased Our Reserves and Strengthened Our Confidence in Continuous Mining Operations Source: Company data
Slide 19: Sources
Sources https://www.businessinsider.com/china-continues-push-into-ev-industry-2018-7 http://www.mining.com/web/vale-doubles-nickel-ahead-ev-revolution/ https://www.fitchratings.com/site/re/10058137 https://www.cnbc.com/2019/01/21/china-2018-gdp-china-reports-economic-growth-for- fourth-quarter-year.
Slide 20: End of the Presentation
End of the Presentation Thank you March 22, 2019
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