Norsk Hydro ASA · OSL:NHY
Norsk Hydro ASA — Investor Day (2017)
15 slides from Norsk Hydro ASA's investor day presentation, Dec 12, 2017
Slide 1: From extrusions to solutions
From extrusions to solutions Egil Hogna, EVP Extruded Solutions
Slide 2: Extruded Solutions – #1 in the global aluminium extrusion industry
Extruded Solutions – #1 in the global aluminium extrusion industry Present in ~ 40 countries > 50% of production using remelted aluminium 22,400 people * BNOK 56 in turnover ** * As of end-2016 ** Rolling 12 months Q3 2017 103
Slide 3: The global extrusion champion – worldwide reach, local presence
The global extrusion champion – worldwide reach, local presence Clear leader in a fragmented industry where closeness to customers and markets are key success factors Unrivalled position as #1 extrusions provider globally Customers in diversified end-markets Extrusion sales volumes (2016), in thousa
Slide 4: Unique market positions, built on European and US strongholds
Unique market positions, built on European and US strongholds 22,400 highly competent people across the world Extrusion Europe Extrusion North America Precision Tubing Building Systems • Market leader focusing on • Uniquely positioned as the • Technology leader in selected • Leading European player
Slide 5: Proven track-record of value creation with further potential
Proven track-record of value creation with further potential Successful value-over-volume strategy Last 12 months underlying EBITDA Net added value* per kg After-tax ROACE (100%) (NOK, indexed to 2014) EBITDA in MNOK ROACE in % 138 136 4000 14 3500 12 125 3000 10 2500 8 2000 6 100 100 1500 97 98 97
Slide 6: Strategic principles in Extruded Solutions
Strategic principles in Extruded Solutions • Make a decent profit decently – safety, quality and compliance • Positive dissatisfaction – be happy, but not satisfied • Fail fast – and learn from it • Value over volume – and the power of available capacity • Develop unique niches – with Extruded Solut
Slide 7: Our competitive advantages are strengthened as part of Hydro
Our competitive advantages are strengthened as part of Hydro 1 Unmatched technology competence 2 Value chain width and depth 3 Global reach and local presence 108
Slide 8: Our strategy is about “value over volume”
Our strategy is about “value over volume” with simplification and collaboration to avoid waste of resources Increase value-added Simplify and Grow to lift margins 1 to our customers 2 collaborate 3 and profitability 109
Slide 9: Moving from simple extrusions to more advanced solutions
Moving from simple extrusions to more advanced solutions More than half of our billets are remelted from scrap in our own cast houses Extrusions are often cut and joined Fabrication and assembly to customer specific products or modules Surface treatment for long life and low maintenance costs 110
Slide 10: Targeting the high-tech, high-competence segments of extrusion
Targeting the high-tech, high-competence segments of extrusion Increased focus on value-add, specialized and advanced product niches Tailored solutions Finished products Service 111
Slide 11: Increasing our capabilities also through sustaining investments
Increasing our capabilities also through sustaining investments • Sustaining capex BNOK 1.3-1.5 • Includes productivity and reliability improvements, safety investments and replacement projects • Replacing parts that are worn-out increases reliability and drives stability and quality in the processe
Slide 12: Profitable growth and sustainability combined
Profitable growth and sustainability combined Re-opening the Bedwas factory in Wales • Bedwas will supply the automotive industry, focusing on electrical vehicles • A key customer is the London Electrical Vehicle Company, with its new zero-emissions capable black cab • Investment of £9.6 million in
Slide 13: Shaping the furniture of future with IKEA
Shaping the furniture of future with IKEA • From extrusions to solutions • IKEA purchasing: Got a problem? Ask Hydro – they will solve it • Innovation support from the beginning − Strong product development − Fast and flexible in-house prototyping − Superior surface finish − One-stop shop 114
Slide 14: Shaping the furniture of future with IKEA
Shaping the furniture of future with IKEA The soon-to-be launched Delaktig sofa • Complete base frame in extruded aluminium • Knocked down in a cardboard box • Assembled by the customers • Sales start Feb 2018 • 100% of the aluminium (frame, legs, feet) is recyclable 115
Slide 15: Priorities as Extruded Solutions
Priorities as Extruded Solutions • Further improve within safety, quality and compliance • Increase share of value-added solutions to customers through commercial excellence and innovation • Continue simplification drive to reduce complexity and non-value adding activities • Lift margins and create