Befesa Sa · XETR:BFSA
Befesa Sa — 3rd MainFirst SMID CAP One-on-One Forum 2020
27 slides from Befesa Sa's conference presentation, May 12, 2020
Slide 1: Befesa Presentation
BEFESA BEFESA Befesa Presentation 3rd MainFirst SMID CAP One-on-One Forum, 12 May 2020
Slide 2: Disclaimer
BEFESA Disclaimer This presentation contains forward-looking statements and information relating to Befesa and its affiliates that are based on the beliefs of its management, including assumptions, opinions and views of Befesa and its affiliates as well as information cited from third party sources.
Slide 3: Agenda
BEFESA Agenda 1 Business Update 2 Q1 2020 Results 3 Befesa Overview 3
Slide 4: Executive Summary
BEFESA Executive Summary ▪ Q1 EBITDA €34m, down €9m / 22% YoY; main driver is Covid-19 pressuring metal prices with zinc LME -19% and incl. treatment charges (TC)(1) even -28% YoY; Limited impact on volume with capacity utilisation at ≥ 90% ▪ Continued strong ~€200m available liquidity at Q1: €120m
Slide 5: Resilience During Severe 2008/09 Crisis
Resilience During Severe 2008/09 Crisis BEFESA -&- Q1’20 Crude Steel Production EU Crude Steel Production240 Trend & Befesa’s EAF Dust Throughput during 2008-2010 Q1 2020 Crude Steel Production(1) 482 220 Befesa EAF dust 474 throughput kt Million tonnes Q1´20 Q1’19 YoY change 200 ▪ EU-28 38.3 42.5 -
Slide 6: 2020 – Guidance Framework
BEFESA 2020 – Guidance Framework Lower-end: €100m EBITDA Upper-end: €135m EBITDA EU crude steel market ▪ After -10% in Q1; Q2 to Q4 each severely down ▪ Q2 materially down YoY -&- -37% YoY; Annually down ~30% YoY (like 2009 ▪ Lockdown easing by end Q2 Covid-19 crisis) EU-28 volume ▪ Q3 & Q4 recoveri
Slide 7: Mid-term Growth Roadmap
BEFESA Mid-term Growth Roadmap Continuing growth roadmap even during Covid-19; Focus 2020: Building two EAF steel dust recycling plants in China 1 Hedging ▪ 2019: 92.4kt @ ~€2,310/t ▪ 2020: 92.4kt @ ~€2,250/t ▪ 9M 2021: 57.3kt @ ~€2,200/t Organic growth Indicative earnings 2 2020 focus – top 5 proje
Slide 8: Organic Growth
BEFESA 2 Organic Growth Turkey, Korea & Barcelona completed on time & budget; Supporting growth in 2020+ Portfolio Growth & Diversification Turkey: 65kt to 110kt cap. expansion completed on time & budget EAF Dust Recycling Capacity (kt) ✓ EAF dust recycling plant “brownfield” capacity expansion from
Slide 9: China
BEFESA 3 China Aerial view of Changzhou construction site (Jiangsu province), 19 April 2020 Steel dust WOX warehouse foundation warehouse Slags storage Kiln foundation Service Workshop Office & service buildings building Status update: ✓ Nanjing HQ office applied to re-open on 10 Feb, passed inspect
Slide 10: Sustainability at Befesa
BEFESA Sustainability at Befesa Befesa is a vital player in the circular economy providing sustainable solutions ▪ Befesa recycles annually around 1.5 million tonnes of hazardous residues, avoiding landfilling and recovering and reintroducing around 1.2 million tonnes of valuable new materials ▪ Bef
Slide 11: Investor Agenda
BEFESA Investor Agenda Financial calendar Meet Befesa ✓ Thursday, 20 February 2020: ✓ 04-05 February 2020 – HSBC Preliminary Year-End Results 2019 & Analyst Call Frankfurt, 15th ESG Conference ✓ 05-06 February 2020 – Santander Madrid, XXVI Santander Iberian Conference ✓ Thursday, 26 March 2020: ✓ 11
Slide 12: Agenda
BEFESA Agenda 1 Business Update 2 Q1 2020 Results 3 Befesa Overview 12
Slide 13: Q1 2020 Highlights
BEFESA Q1 2020 Highlights ▪ Steel dust throughput 186kt (+10% YoY); 90% utilisation Good operational performance & ▪ Salt slags & SPL recycled 125kt (-3% YoY); 94% utilisation plant utilisation at ≥90%; ▪ Limited temporary Covid-19 downtimes: One Salt Slags Managing impact from Covid-19 in Q1 plant
Slide 14: Consolidated Key Financials
BEFESA Consolidated Key Financials Q1 EBITDA at €33.6m (-22.0% YoY): Impacted by lower metal prices; Partially offset by higher EAF dust throughput (Turkey) & upgraded alu furnaces Revenue Highlights (€m) ▪ Q1 revenue flat at €179.0m (€-0.1 / -0.1% YoY) primarily due to: + EAF dust throughput +10% h
Slide 15: Steel Dust Recycling Services
BEFESA Steel Dust Recycling Services Q1 EBITDA at €26.0m (-23.4% YoY): Driven by lower zinc prices; Partially offset by higher EAF dust throughput (Turkey) Revenue EAF dust throughput & capacity utilisation(1) (€m) (thousand tonnes, % of annual installed capacity) 95,1 101,2 169,0 185,7 Q1 '19 Q1 '2
Slide 16: Aluminium Salt Slags Recycling Services
BEFESA Aluminium Salt Slags Recycling Services Q1 EBITDA at €8.6m (-3.5% YoY) mainly driven by lower aluminium alloy prices and slightly lower salt slags volumes (Covid-19 related plant downtimes); Partially offset by alu furnace upgrades delivering results; >90% plant utilisation Revenue(1) Volumes
Slide 17: Consolidated Net Debt / Leverage / Cash Flow / Capital Structure
Consolidated Net Debt / Leverage / BEFESA Cash Flow / Capital Structure Continued strong ~€200m liquidity (Cash €120m; €75 RCF undrawn); Long-term capital structure: No maturities to July ´26; 2% interest; No covenant; Managing cash & cost rigorously; Funding China expansion Net debt & leverage rate
Slide 18: Zinc Prices & Hedging Strategy
BEFESA Zinc Prices & Hedging Strategy Hedging up to Oct ´21 improves earnings & cash flows visibility for 2020 & 2021 € 3.000 Market zinc price vs. zinc hedges (€/tonne) € 2.500 ~€2,310 ~€2,250 €2,168 9M ’21: €2,280 €2,160 ~€2,200 € 2.000 €2,051 Closed ~half of Q3 ’21 €1,939 €1,876 targeted hedge vo
Slide 19: Agenda
BEFESA Agenda 1 Business Update 2 Q1 2020 Results 3 Befesa Overview 19
Slide 20: Befesa at a Glance
BEFESA Befesa at a Glance Befesa a market leader in Europe & Asia in providing regulated critical hazardous waste recycling services to the steel and aluminium industries LTM Q1 2020 Revenue: €648m(1) LTM Q1 2020 EBITDA: €150m 2nd 2nd Aluminium Aluminium 35% 8% Steel Dust Salt Slags Steel Dust 53% 1
Slide 21: Main Milestones
BEFESA Main Milestones Befesa has grown successfully through organic initiatives and acquisitions Founded Successful greenfield Frankfurt Stock Acquisitions & turnarounds in Germany (state-of-the-art technology) Exchange & SDAX 1987 2006 2009 2013 2014 2017 / 2018 Metallgesellschaft, Befesa acquires
Slide 22: Investment Highlights
BEFESA Investment Highlights 2 European market leader in niche recycling 1 3 markets with Favourable macro competitive advantage from Critical and mega trends plants close to environmental supporting Steel clients regulated services Dust and to long-term clients Aluminium markets 7 4 Experienced Alu
Slide 23: Market Leader and Close Proximity to Clients
BEFESA 2 Market Leader and Close Proximity to Clients Befesa is the market leader in steel dust and salt slags recycling services with a competitive advantage due to its close proximity to key clients Established market leader Proximity to clients provides strong competitive advantage Steel Dust Rec
Slide 24: Critical Service – Highly Regulated
BEFESA 3 Critical Service – Highly Regulated Befesa offers a crucial service taking care of highly regulated hazardous waste in the value chain of secondary steel and aluminium producers Recycling service Consequences of Hazardous waste non-compliance Steel Dust value Steel WOX • Major European stee
Slide 25: Highly Resilient Business
BEFESA 5 Highly Resilient Business Revenues(1) EBITDA and % margin(2) (€m) (€m) 22% 26% 24% 25% 23% 720 667 648 648 172 176 594 160 150 9 12 296 300 245 239 133 27 25 12 12 9 21 20 268 83 82 81 24 83 79 135 137 125 117 332 381 360 366 99 281 2016 2017 2018 2019 LTM Q1'20 2016 2017 2018 2019 LTM Q1'2
Slide 26: Mid-term Growth Roadmap
BEFESA 6 Mid-term Growth Roadmap Continuing growth roadmap even during Covid-19; Focus 2020: Building two EAF steel dust recycling plants in China 1 Hedging ▪ 2019: 92.4kt @ ~€2,310/t ▪ 2020: 92.4kt @ ~€2,250/t ▪ 9M 2021: 57.3kt @ ~€2,200/t Organic growth Indicative earnings 2 2020 focus – top 5 pro
Slide 27: Experienced Management Team
BEFESA 7 Experienced Management Team Senior management team delivering results through long standing industry expertise, entrepreneurial spirit and focus on operational excellence as well as governance and compliance processes Javier Molina Wolf Lehmann Key achievements / track record CEO CFO; inclu
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