Korea Zinc Co., Ltd. · KRX:010130
Korea Zinc — Q3 2023 Earnings Presentation
25 slides from Korea Zinc's earnings presentation, November 2023
Slide 1: Korea Zinc 3Q 2023 Earnings Release
Korea Zinc 3Q 2023 Earnings Release
Slide 2: Contents
CONTENTS 3Q 2023 Business Results (Consol.) Results & Outlook by Business • Korea Zinc (Standalone) • Sorin Corporation • Sun Metals Corporation • Steel Cycle Company TROIKA DRIVE • Secondary Battery Materials • Resource Recycling • Renewables & Hydrogen Shareholder Return Policy Appendix
Slide 3: Disclaimer
Disclaimer This presentation contains forward looking information and statements with respect to market conditions, financial conditions, results of operations and business, and plans of the management. Please note they may differ from actual results. Financial results herein are under audit review,
Slide 4: 3Q 2023 Business Results (Consol.)
3Q 2023 Business Results (Consol.) Sales trend by business (bn KRW) Sales and Operating Profit (bn KRW) KZ (Standalone) Sorin Corp. SMH Steel Cycle and others 3Q22 4Q22 1Q23 2Q23 3Q23 QoQ 2,962 2,744 122 2,527 92 238 2,469 163 129 2,293 Sales 2,744 2,962 2,527 2,469 2,293 - 176 120 528 232 550 266 9
Slide 5: 3Q 2023 Business Results (Consol.)
3Q 2023 Business Results (Consol.) Balance Sheet (bn KRW) Financial Ratios (bn KRW) 1Q23 2Q23 3Q23 QoQ 부채비율 Liabilities/Equity 차입금비율 Debts/Equity 순차입금비율 Net Debts/Equity Asset 11,721 11,340 11,953 +614 29.3% Current Assets 5,529 5,113 5,746 +633 25.0% 23.3% Cash and Equivalents* 598 503 694 +191 Non
Slide 6: Results & Outlook by Business: Korea Zinc (Standalone)
Results & Outlook by Business Korea Zinc (Standalone) Sorin Corporation SMC Steel Cycle Sales by Product (bn KRW) 2,164 2,048 3Q Results 8% 10% 3% 1,815 1,787 1,783 3% 11% 7% 7% 6% Others • Lead and silver sales Increase 11% 5% 5% 4% 13% 11% 10% Copper contributes to profitability despite zinc 20% 2
Slide 7: Results & Outlook by Business: Sorin Corporation
Results & Outlook by Business Korea Zinc (Standalone) Sorin Corporation SMC Steel Cycle Sales by Product (bn KRW) 549.6 527.5 13.5 22.8 495.5 3Q Results 20.2 406.0 265.3 180.5 • Sales decreased due to shipment delay 17.0 184.7 leading to differed sales 314.8 기타 Others 145.6 • Increasing high profit
Slide 8: Results & Outlook by Business: Sun Metals
Results & Outlook by Business Korea Zinc (Standalone) Sorin Corporation SMC Steel Cycle Sales by Product (‘000USD) 195,732 181,561 3Q Results 26,991 155,457 23,997 4,986 • Sales revenue decrease due to zinc 5,713 4,687 143,152 4,179 4,503 prices drop and decrease in sales volume 117,212 4,157 LGZC a
Slide 9: Results & Outlook by Business: Steel Cycle
Results & Outlook by Business Korea Zinc (Standalone) Sorin Corporation SMC Steel Cycle Sales by Product (bn KRW) 25.4 3Q Results 23.1 21.0 19.7 • Despite decline in zinc prices, SC and SCSC’s partial increase in operation rate 16.1 leads to sales volume increase while profitability shows limited re
Slide 10: TROIKA DRIVE
TROIKA DRIVE Redefining KZ’s next 50 years Secondary Battery Materials Resource Recycling Renewables & Hydrogen
Slide 11: Secondary Battery Materials
Secondary Battery Materials Secondary Battery Materials Resource Recycling Renewable Energy & Hydrogen Establishing closed-loop supply chain for key secondary battery materials Creating industry ecosystem with world leading technology and metal-sourcing capabilities Mine Smelting/Refining Cathode/An
Slide 12: All-in-one Nickel Smelter
Secondary Battery Materials Secondary Battery Materials Resource Recycling Renewable Energy & Hydrogen All-in-one Nickel Smelter Input Output Nickel Smelter Utility KZ Group • Production Capacity : Ni Metal 43ktpa NC Solution • Capex : KRW 506.3 bn Intermediate KZ Nickel Business Ni Solution • Timel
Slide 13: KEMCO Capital Injection
Secondary Battery Materials Secondary Battery Materials Resource Recycling Renewable Energy & Hydrogen KEMCO Capital Injection Before After KEMCO Capital Injection Others • Purpose : To invest in KEMCO’s all-in-one Others Korea Zinc Korea Zinc 14.2 Nickel smelter LG Chem • Amount of financing : 616.
Slide 14: Resource Recycling
Resource Recycling Secondary Battery Materials Resource Recycling Renewable Energy & Hydrogen Establishing circular economy through urban mine business model Enables recovery of precious metals from wastes such as EV battery, PCB, etc. KZ’s Raw Material Ratio Utilizing Secondary Materials Recovering
Slide 15: Renewable Energy & Hydrogen
Renewable Energy & Hydrogen Secondary Battery Materials Resource Recycling Renewable Energy & Hydrogen Establishing renewable energy value chain of green hydrogen production Producing green hydrogen via utilization of renewable energy to achieve carbon neutrality Green Hydrogen Production and Renewa
Slide 16: Shareholder Policy
Shareholder Policy Dividend & Retirement of Shares
Slide 17: Shareholder Policy
Shareholder Policy Dividend Trend (bn KRW) Total Capital Return 397 Payout Ratio (Standalone) 353 Shareholder Policy Highlights 299 60.54% 265 247 47.23% • Maintaining dividend payout ratio at 30% 46.88% 43.63% or higher (Standalone net profit basis) for 3 years (2023~2025) • FY23 Interim Div. • DPS
Slide 18: Appendix
APPENDIX ’20-’23 Sales Trend (Target / Actual) Metal Prices & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position
Slide 19: '20-'23 Sales Trend (Target / Actual)
’20-’23 Sales Trend (Target / Actual) ’20-’23 Sales Trend Metal Price & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position Unit : 1kt(Zinc, Lead), 100t(Silver), %(Actual/Target) 100% 99% 99% 650 180 640 190 640 640 190 77% 101% 98% 101% 160 150 150 430 120 150 430 430 41
Slide 20: Metal Prices & FX rates
Metal Prices & FX rates ’20-’23 Sales Trend Metal Price & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position KRW/USD (Avg.) Zinc (USD/MT) Lead (USD/MT) 4,000 2,600 1,500 3,800 2,500 1,450 3,600 2,400 1,400 3,400 2,300 1,359 3,269 2,170 1,350 1,339 3,200 3,130 2,200 2,141
Slide 21: LME Price & Raw Materials Cost Trend
Metal Prices & FX rates ’20-’23 Sales Trend Metal Price & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position LME Price & Raw Materials Cost Trend (USD/t) Zinc Lead 4,800 3,500 Profit from rise in LME price 4,300 3,000 3,800 2,500 Loss from LME price decline 3,300 2,000 2
Slide 22: Sales Volume Breakdown
Sales Volume Breakdown ’20-’23 Sales Trend Metal Price & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position KZ (Standalone) KZ 3Q22 4Q22 1Q23 2Q23 3Q23 QoQ YoY Zinc(MT) Domestic 49,429 43,804 46,190 49,199 55,278 12.4% 11.8% Export 96,099 144,866 110,282 127,329 104,096
Slide 23: Sales Revenue Breakdown
Sales Revenue Breakdown ’20-’23 Sales Trend Metal Price & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position KZ (Standalone) (bW) 3Q22 4Q22 1Q23 2Q23 3Q23 QoQ YoY Zinc Domestic 237 198 203 193 190 -1.5% -19.7% Export 481 644 478 460 357 -22.3% -25.7% Total 718 842 681 65
Slide 24: PL & Financial Position
PL & Financial Position ’20-’23 Sales Trend Metal Price & FX rates Sales Volume Breakdown Sales Revenue Breakdown PL & Financial Position Korea Zinc (Consol.) Sorin Corporation PL (bn KRW) 3Q22 4Q22 1Q23 2Q23 3Q23 QoQ YoY PL (bn KRW) 3Q22 4Q22 1Q23 2Q23 3Q23 QoQ YoY Sales 2,744 2,962 2,527 2,469 2,2
Slide 25: IR contact
APPENDIX IR contact IR@koreazinc.co.kr