Ssab Ab Class A · OMXSTO:SSAB_A
Ssab Ab Class A — Q1 2023 Earnings Presentation
28 slides from Ssab Ab Class A's earnings presentation, Apr 26, 2023
Slide 1: Presentation of the Q1/2023 report
Presentation of the Q1/2023 report Martin Lindqvist, President & CEO Leena Craelius, CFO April 26, 2023
Slide 2: Agenda
Agenda − Q1/23 in brief − Financials − Outlook and summary − Q&A 2
Slide 3: Q1/23 in brief
Q1/23 in brief SSAB
Slide 4: Highlights in Q1
Highlights in Q1 Higher earnings vs. Successful ramp- Improved Strong previous quarter up of production safety balance sheet +1.3bn 10,395 +25% 1.60 1.56 8,377 2,044 14.3 15.6 1,985 1,916 6,742 +26% 1,751 1,641 1.15 1.06 0.92 2.3 4,733 3,768 -11.7 -10.3 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/2
Slide 5: SSAB Special Steels
SSAB Special Steels Earnings on good Shipments recovering level from Q4/22 +53% +14% 2,373 2,390 381 396 2,086 2,094 336 349 305 1,369 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Operating result (adj), SEK m Shipments, ktonnes − Q4/22 impacted by − European market not as planned mai
Slide 6: SSAB Americas
SSAB Americas Earnings on Higher Market prices good level shipments stabilized in Q1 +14% 120 3,511 -2% 3,034 100 2,991 476 476 2,725 2,675 438 416 418 80 60 40 20 0 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Jan -22 Mar -23 Operating result (adj), SEK m Shipments, ktonnes US plate
Slide 7: SSAB Europe
SSAB Europe Some improvement High and stable Higher Market prices vs. previous quarter production in Q1 shipments increased in Q1 +26% +17% 160 4,069 140 3,249 1,141 912 1,049 1,068 844 838 120 778 889 905 713 100 1,446 80 +229m 60 40 0 20 -229 0 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/22 Q4/22
Slide 8: Ruukki Construction and Tibnor
Ruukki Tibnor Construction Recovery in Lower inventory Weak market in Lower revenue and shipments vs. Q4/22 losses vs. Q4/22 Q1 weaker margins +14% 608 2,020 -13% 209 251 242 229 414 1,739 212 1,588 1,534 160 156 +409m 183 1,329 1 -181 -408 -1 -9 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/22 Q4/22
Slide 9: Launch of SSAB Zero
Launch of SSAB Zero − Zero carbon emission in operations. Third-party verified − Based on recycled steel, fossil- free electricity, bio carbon and bio gas − No carbon emission offsetting or mass balancing allocation schemes − Orders from leading customers like Volvo Group, Epiroc and Peab 9
Slide 10: Plan to fossil-free production on track
Plan to fossil-free production on track Stepwise transformation – dependent on permits and grid connections 1 2 3 4 Zero Steel Oxelösund EAF 1st Mini-Mill 2nd Mini-Mill • Produce Zero steel • Replace current • First mini-mill • Second mini-mill in Iowa, USA blast furnaces and operational – either op
Slide 11: Financials
Financials SSAB
Slide 12: Recovery in demand during Q1/23 vs. Q4/22
Recovery in demand during Q1/23 vs. Q4/22 Increased production and shipments, lower realized prices Revenue (SEK million) Steel shipments (ktonnes) 40,000 2,000 35,000 30,000 1,500 25,000 20,000 1,000 15,000 10,000 500 5,000 0 0 20Q1 20Q2 20Q3 20Q4 21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 20Q1 2
Slide 13: Change in adjusted operating result Q1/23 vs. Q4/22
Change in adjusted operating result Q1/23 vs. Q4/22 Lower prices in 4,733 all steel divisions 690 -15 3,768 335 750 No maintenance and -1,830 successful ramp-up of production 1,035 Q4/22 Price Volume Variable Fixed costs FX Capacity Q1/23 COGS utilization 13
Slide 14: Change in adjusted operating result Q1/23 vs. Q1/22
Change in adjusted operating result Q1/23 vs. Q1/22 8,377 Higher cost for raw material -1,645 625 -2,115 Weaker European market with lower -750 4,733 prices -25 265 Q1/22 Price Volume Variable COGS Fixed costs FX Capacity Q1/23 utilization 14
Slide 15: Solid cash flow
Solid cash flow SEK millions 2023 2022 2022 Q1 Q1 Full year EBITDA 5,600 8,996 32,340 Change in working capital -1,618 -4,404 -8,279 Maintenance capex -367 -272 -2,196 Other -480 599 828 Operating cash flow 3,135 4,918 22,693 Financial items 104 -15 -17 Taxes -754 -1,354 -5,947 Cash flow from curren
Slide 16: Strong financial position
Strong financial position − Net cash of SEK 15.6bn at the end SEK m of Q1/23 20,000 − Net debt/equity ratio -22% (-7%) 14,287 15,590 15,000 − Dividend to be paid in Q2 (SEK 8.70 per share), corresponding to a total 10,000 of SEK 9bn. 5,000 2,346 0 -5,000 -10,000 -10,278 -11,696 -15,000 2019 2020 202
Slide 17: Raw material
Raw material SSAB’s purchase price, year over year changes Market prices (AMM) Iron ore Coking coal Scrap USD/gross ton 21% 349% 600 500 6% 211% 400 2% 300 128% 200 -4% 44% 100 0 -19% -6% Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 − The cost of most raw materials is expected to be i
Slide 18: Cash needs of the business
Cash needs of the business − Total cash needs1) in 2023 estimated at around SEK 11bn (unchanged) ~11 − Higher strategic capex vs. 2022 due to ramp-up of Oxelösund conversion 10.0 Capex − As a starting point, a stable taxes paid has been assumed. It (maintenance ~5 will, however, depend on the level
Slide 19: Expected maintenance costs
Expected maintenance costs − SSAB’s total maintenance costs for 2023 are expected to be SEK 1,550 (1,540) million, unchanged to previous forecast SEK million 2023 2023 2023 2023 FY − Most maintenance to be carried out in Q4 Q1 Q2 Q3 Q4 2023 SSAB Special Steels -- -- 150 525 675 SSAB Europe -- -- 350
Slide 20: Outlook and summary
Outlook and summary SSAB
Slide 21: SSAB's outlook for main customer segments Q2/2023
SSAB’s outlook for main customer segments Q2/2023 Segment Demand Comments Strong Neutral Weak - Improved supply chain and good demand for heavy trucks in Europe Heavy Transport - Stable demand from rail car in the US - Improved supply of components to OEMs Automotive - Risk in end-user demand (infla
Slide 22: SSAB's outlook for Q2/2023
SSAB’s outlook for Q2/2023 - European demand is expected to be stable - Heavy plate market in North America is Volume and pricing outlook expected to continue at a good level - Demand for high-strength steel is Q2 2023 vs. Q1 2023 Shipments Realized prices expected to be good on several markets SSAB
Slide 23: Summary
Summary − Successful ramp-up after previous quarter − Continued good trend in safety − Good cash flow generation − Strong financial position − Decent outlook for Q2 − Leading the green transition − Launch of SSAB Zero – based on recycled steel and no fossil carbon emissions 23
Slide 24: Questions and Answers
Questions and Answers SSAB
Slide 25: Appendix
Appendix SSAB
Slide 26: Debt portfolio duration and interest rate
Debt portfolio duration and interest rate − Duration of the loan portfolio was 5.4 (6.1) years 8.0 4.00 − Averaged fixed interest term was 0.8 7.0 3.50 (1.0) years 6.0 3.00 5.0 2.50 − Average interest rate was 3.8% (2.4%) 4.0 2.00 3.0 1.50 2.0 1.00 1.0 0.50 0.0 0.00 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2
Slide 27: Maturity profile
Maturity profile − Liquid assets and committed credit SEK m lines at SEK 37.4 bn 40,000 35,000 Back-up 30,000 facilities 25,000 20,000 15,000 Cash 10,000 5,000 0 Cash and back-up 2023 2024 2025 2026 facilities 27
Slide 28: SSAB
SSAB