Metallus Inc. · NYSE:MTUS
Metallus — Investor Presentation (February 2025)
45 slides from Metallus's investor presentation, February 2025
Slide 1: Investor Presentation
Investor Presentation February 2025
Slide 2: Forward-Looking Statements & Non-GAAP Financial Measures
Forward-Looking Statements & Non-GAAP Financial Measures Forward-looking statements This presentation includes "forward-looking" statements within the meaning of the federal securities laws. You can generally identify the company's forward-looking statements by words such as "will," "anticipate," "a
Slide 3: Metallus Today
Metallus Today Founded in 1917 and established as a standalone public company in 2014 Renamed Metallus Inc. (NYSE: MTUS) in February 2024 (formerly known as TimkenSteel Corporation) Provider of high-quality specialty metals, manufactured components and supply chain solutions Produces 100% of steel p
Slide 4: Metallus Investment Highlights
Metallus Investment Highlights ▪ Experienced leadership team successfully executing on business transformation to drive profitable growth ▪ Long-standing commitment to operating safely and responsibly to protect our employees, our communities and the environment ▪ Leveraging long-term, trusted partn
Slide 5: Experienced Leadership Team Executing Sustainable Growth Strategy
Experienced Leadership Team Executing Sustainable Growth Strategy MICHAEL WILLIAMS KRISTOPHER WESTBROOKS KEVIN RAKETICH KRISTINE SYRVALIN President and Chief Executive Officer EVP and Chief Financial Officer EVP and Chief Commercial Officer EVP, General Counsel and Chief Human Resources Officer ANDR
Slide 6: Significant Transformation Underway
Significant Transformation Underway 2014-19 2020-21 2022+ Capital investment Transformation begins Strategic direction and volatility through cost and cash discipline and financial strength Actions Successful Outcomes ▪ Invested over $350M to ▪ New leadership team ▪ Achieved over $100M of ▪ Deliver
Slide 7: Serving Diverse and Demanding End Market Sectors with Broad Product Portfolio
Serving Diverse and Demanding End Market Sectors with Broad Product Portfolio 2024 END MARKET SECTOR MIX PRODUCT MIX Energy Other 2% 7% Energy SHIPMENTS(2) NET SALES(3) 8% Industrial Aerospace & 36% (in tons) (in $’s) Defense 8% Industrial Aerospace & 40% Defense 12% Engineered Bars 73% 59% (“SBQ”)
Slide 8: Financial Summary and Highlights
Financial Summary and Highlights Q4 2024 SUMMARY ▪ Net sales of $240.5M with net loss of $21.4M and adjusted EBITDA(1) of $8.3M ▪ Operating cash flow of $13.9M ADJUSTED EBITDA ($M)(1) OPERATING CASH FLOW ($M) ▪ Cash and cash equivalents balance $240.7M with total liquidity(2) of $458.6M at $74 the e
Slide 9: Long-Term, Trusted Partnerships with Industry Leading Customers
Long-Term, Trusted Partnerships with Industry Leading Customers OVERVIEW ▪ Our specialized products and services are used in a wide range of demanding applications around the world ▪ Support approximately 350 diverse customers in automotive, aerospace & defense (“A&D”), industrial equipment, mining,
Slide 10: End Market Overview
End Market Overview ▪ Utilizes SBQ and SMT to extend lifecycles in critical applications in heavy machinery ▪ Offering largest SBQ size range (1” – 16” diameter) in N. America ideally suited for forging and machining bars Industrial ▪ Meets diverse needs of customers in the off-highway, rail, marine
Slide 11: Industrial and Energy Market Indicators
Industrial and Energy Market Indicators U.S AVG. RIG COUNT & PURCHASING MANAGERS INDEX (“PMI”) WEST TEXAS INTERMEDIATE (“WTI”) SPOT PRICE 70 1,200 $120 1,000 $100 60 800 $80 600 $60 50 400 $40 200 $20 40 0 $- Jan-19 Apr-19 Jul-19 Jan-20 Apr-20 Jul-20 Jan-21 Apr-21 Jul-21 Jan-22 Apr-22 Jul-22 Jan-23
Slide 12: Automotive Market Indicators
Automotive Market Indicators N.A. LIGHT VEHICLE SAAR (M UNITS) N.A LIGHT VEHICLE INVENTORY (DAYS) 16.9 140 16.3 15.8 15.7 15.9 15.5 15.4 14.9 15.1 14.5 14.3 120 13.7 13.0 13.0 100 80 60 40 20 2019 2020 2021 2022 2023 2024 2025F - Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24 Jan-25 Sales Production Sour
Slide 13: Trusted Supplier of SBQ, SMT and Manufactured Components for Automotive Industry
Trusted Supplier of SBQ, SMT and Manufactured Components for Automotive Industry Metallus Applications in Electric Vehicles Metallus Applications in Internal Combustion Engine and Hybrid Vehicles 13
Slide 14: Electric Vehicle and Hybrid Transformation
Electric Vehicle and Hybrid Transformation EV Motor Rotor Shaft Process ▪ Long-term manufactured component agreements secured for growing EV and hybrid portfolio 2.5” ▪ EV portfolio consists of ~20 awarded component parts Diameter SBQ ▪ Actively quoting and exploring additional EV and hybrid manufac
Slide 15: Aerospace and Defense Market Indicators
Aerospace and Defense Market Indicators ▪ Since 2022, the U.S. Government (“USG”) has supplied over 3,000,000 artillery rounds to NATO partners ▪ Considering ongoing capacity investments and future build rates forecasted until 2028, the DoD strategy for 155mm artillery shells requires specialty ste
Slide 16: Work with U.S. Army for Munitions Expansion
Work with U.S. Army for Munitions Expansion ANNUAL GOVERNMENT FUNDING* vs. PROJECT INVESTMENT (estimated) ▪ Metallus secured $99.75M of committed funding from the U.S. Army to enhance munitions production $M $140 ▪ In 2024, Metallus received $53.5M in cash funding $120 ▪ Funding will support investm
Slide 17: Our Ongoing Commitment to Sustainability
Our Ongoing Commitment to Sustainability “Advancing our commitment to sustainability” is a strategic imperative for the company, as demonstrated by… Increased transparency with Global Reporting Initiative (“GRI”) reporting Targeted capital allocation for continuous improvement Embedded focus on sust
Slide 18: Focused On Key Areas That Influence Our Operations
Focused On Key Areas That Influence Our Operations ENVIRONMENTAL SOCIAL GOVERNANCE STEWARDSHIP COMMITMENT AND ETHICS ▪ Monitoring our greenhouse ▪ Prioritizing health and safety ▪ Business ethics and compliance gas (“GHG”) and other ▪ Encouraging learning and growth ▪ Internal procedures and control
Slide 19: Environmental Stewardship Highlights
Environmental Stewardship Highlights OUR 2030 ENVIRONMENTAL GOALS PERFORMANCE AGAINST OUR GOALS (2021-2023) (compared with a 2018 baseline) 40% absolute reduction in combined Scope 1 and Scope 2 GHG emissions 30% absolute reduction in total energy consumption 35% absolute reduction in fresh water wi
Slide 20: Health & Safety Governance
Health & Safety Governance SAFETY PERFORMANCE HEALTH & SAFETY GOVERNANCE STRUCTURE (1) OSHA Recordable Incident Rate is defined as OSHA-recordable incidents multiplied by 200,000, then divided by the total number of hours worked during the applicable year. 20 (2) Lost-Time Incident Rate is defined a
Slide 21: Growth Strategy and Long-Term Outlook
Growth Strategy and Long-Term Outlook
Slide 22: Successfully Executing on Our Sustainable Growth Strategy
Successfully Executing on Our Sustainable Growth Strategy 2026 Deliver on strategic imperatives for Drive growth with sustainable through-cycle profitability balanced capital allocation ▪ Deliver $80M of run-rate profitability ▪ Continue to diversify portfolio to achieve optimal improvement through
Slide 23: Long-Term Operational and Financial Targets
Long-Term Operational and Financial Targets THROUGH-CYCLE HISTORICAL LONG-TERM ACTUAL TO DATE – AVERAGE(1) 2022 THROUGH 2024 TARGETS(2) Melt utilization 61% Mid 80%’s 64% rate Adjusted EBITDA 8% > 12% 11% margin(3) Return on capital 11% 15% to 17% 15.5% employed(4) Capital $28M $30M to $40M $45M exp
Slide 24: Significant Profit Drivers to Deliver Long-Term Targets
Significant Profit Drivers to Deliver Long-Term Targets COMMERCIAL EXCELLENCE $30M ▪ Portfolio optimization to improve product mix and margin ▪ Targeted growth applications and markets $80M MANUFACTURING & RELIABILITY EXCELLENCE Objective is to deliver sustainable $30M ▪ Manufacturing productivity a
Slide 25: Balanced Approach to Capital Allocation
Balanced Approach to Capital Allocation INVEST IN PROFITABLE GROWTH ▪ Focused organic investments with returns in excess of cost of capital ▪ Invested $64.3M in 2024 and forecasting $125M of CapEx in 2025, inclusive of investments supported by government funding MAINTAIN A STRONG BALANCE SHEET ▪ Sou
Slide 26: Metallus Investment Highlights
Metallus Investment Highlights ▪ Experienced leadership team successfully executing on business transformation to drive profitable growth ▪ Long-standing commitment to operating safely and responsibly to protect our employees, our communities and the environment ▪ Leveraging long-term, trusted partn
Slide 27: Appendix
Appendix
Slide 28: Operations Across Our Facilities
Operations Across Our Facilities Faircrest Plant Harrison Plant Gambrinus Plant Tryon Peak Plant St. Clair Plant Mexico Warehouse Canton, OH Canton, OH Canton, OH Columbus, NC Eaton, OH Monterrey, Mexico Steelmaking and Small Bar Seamless Mechanical Warehouse, Precision Component Warehousing and Int
Slide 29: Metallus Uses EAF Technology For Its Steelmaking
Metallus Uses EAF Technology For Its Steelmaking EAF process ▪ Uses recycled steel scrap as primary raw material ▪ Uses electricity as main source of energy to melt scrap ▪ Produces substantially fewer emissions and consumes less energy than traditional blast furnace technology ▪ EAF allows for all
Slide 30: Overview of Broad Product Offering
Overview of Broad Product Offering BROAD COMMERCIAL POSITION SEAMLESS MECHANICAL TUBES ENGINEERED BARS ▪ Diversified customer mix ▪ 37-ton average order size ▪ Additional product offering forms including ingots, cast blooms, billets and manufactured components 3” – 13” MANUFACTURED COMPONENTS OVERVI
Slide 31: Incentive Compensation Structure
Incentive Compensation Structure Award Objective Metrics Employees Time Period Annual Incentive • Execution of annual business priorities • Adjusted EBITDA • All salaried • 1 year • Variable cash compensation based on • Adjusted Operating performance Cash Flow • Safety Performance-Based • Long-term
Slide 32: Pension and OPEB Plans Overview
Pension and OPEB Plans Overview Plan % Number of $M status Assets* Liabilities* Funded participants** Recent actions / current projects • Closed to new entrants effective 1/1/2022 • Lump sum option added effective 1/1/2022 Closed, U.S. bargaining plan $342 $472 72% 2,207 • Completed $256M annuitizat
Slide 33: Historical Financial Performance
Historical Financial Performance NET SALES ($M) / SHIPPED TONS (K) / MELT UTILIZATION AVERAGE BASE SELLING PRICE ($/TON)(3) $2,000 Tons Melt Utilization % 100% $1,556 $1,494 80% $1,500 $1,283 $1,330 $1,362 $1,322 $1,084 60% Full-Year $1,000 $831 Record 40% $1,085 $1,069 $500 819 640 692 684 20% 556
Slide 34: Select Performance History by End Market Sector
Select Performance History by End Market Sector SHIPMENTS BY END MARKET SECTOR (K TONS) AVERAGE BASE SALES BY END MARKET SECTOR ($ / TON)(1)(2)(3) (3) (2) Industrial Automotive Aerospace & Defense Energy Other Industrial Automotive Aerospace & Defense Energy Other 29 39 $3,000 36 20 63 67 39 27 46 4
Slide 35: Annual Reconciliation of Base Sales to GAAP Net Sales
Annual Reconciliation of Base Sales(1) to GAAP Net Sales The tables below present net sales by end-market sector, adjusted to exclude surcharges, which represents a financial measure that has not been determined in accordance with accounting principles generally accepted in the United States (“U.S.
Slide 36: Annual Reconciliation of Base Sales to GAAP Net Sales
Annual Reconciliation of Base Sales(1) to GAAP Net Sales The table below presents net sales, adjusted to exclude surcharges, which represents a financial measure that has not been determined in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). We believe pr
Slide 37: Quarterly Reconciliation of Base Sales to GAAP Net Sales
Quarterly Reconciliation of Base Sales(1) to GAAP Net Sales The tables below present net sales by end-market sector, adjusted to exclude surcharges, which represents a financial measure that has not been determined in accordance with accounting principles generally accepted in the United States (“U.
Slide 38: Quarterly Reconciliation of Base Sales to GAAP Net Sales
Quarterly Reconciliation of Base Sales(1) to GAAP Net Sales The table below presents net sales, adjusted to exclude surcharges, which represents a financial measure that has not been determined in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). We believe
Slide 39: Annual Reconciliation of EBIT, EBITDA and Adjusted EBITDA to Net Income
$mReconciliation of Earnings (Loss) Before Interest and Taxes (EBIT)(2), Adjusted EBIT(5), Earnings (Loss) Before Interest, Taxes, Depreciation and Amortization (EBITDA)(4) and Adjusted EBITDA(6) to GAAP Net Income (Loss) This reconciliation is provided as additional $M ANNUAL – CONSOLIDATED TOTAL (
Slide 40: Quarterly Reconciliation of EBIT, EBITDA and Adjusted EBITDA to Net Income
$mReconciliation of Earnings (Loss) Before Interest and Taxes (EBIT)(2), Adjusted EBIT(5), Earnings (Loss) Before Interest, Taxes, Depreciation and Amortization (EBITDA)(4) and Adjusted EBITDA(6) to GAAP Net Income (Loss) This reconciliation is provided as additional relevant $M QUARTERLY – CONSOLID
Slide 41: Reconciliation of Free Cash Flow to GAAP Operating Cash Flow
Reconciliation of Free Cash Flow(1) to GAAP Net Cash Provided (Used) by Operating Activities This reconciliation is provided as additional relevant information about the company's financial position. Free cash flow is an important financial measure used in the management of the business. Management
Slide 42: Calculation of Total Liquidity
Calculation of Total Liquidity(1) This calculation is provided as additional relevant information about the company's financial position. $M QUARTERLY – CONSOLIDATED TOTAL Q4 Q1 Q2 Q3 Q4 (Unaudited) 2023 2024 2024 2024 2024 Cash and cash equivalents $ 280.6 $ 278.1 $ 272.8 $ 254.6 $ 240.7 Credit Agr
Slide 43: Calculation of Average Capital Expenditures and Average Melt Utilization
Calculation of Average Capital Expenditures and Average Melt Utilization This calculation is provided as additional relevant information about the company's financial position. $M ANNUAL – CONSOLIDATED TOTAL Historical Actual to Date (1) (4) 2017 2018 2019 2020 2021 Average 2022 2023 2024 Average (2
Slide 44: Calculation of Average Net Leverage
Calculation of Average Net Leverage(1) This calculation is provided as additional relevant information about the company's financial position. $M ANNUAL – CONSOLIDATED TOTAL Historical (2) 2017 2018 2019 2020 2021 Average 2022 2023 2024 (4) Total Debt $ 165.3 $ 189.1 $ 168.6 $ 78.2 $ 44.9 $ 129.2 $
Slide 45: Calculation of Average Return on Capital Employed
Calculation of Average Return on Capital Employed(1) This calculation is provided as additional relevant information about the company's financial position. HISTORICAL AVERAGE(2) 2020 ($M) 2021 ($M) 2022 ($M) 2019 2020 2020 2021 2021 2022 Total Assets $ 1,085.2 $ 994.0 Total Assets $ 994.0 $ 1,158.9