German Corporate Conference 2012
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Transcript of German Corporate Conference 2012
www.voestalpine.comvoestalpine AG
11th German CorporateConference 2012
Investor RelationsJanuary 2012
| |voestalpine AG2 January 2012 Investor Relations
voestalpine groupBusiness concept (1)
Steel is – and will always be - the base of voestalpine group
BUT: Downstream strategy is strongly driving evolution from
a steel maker to a processing group
Focus on most demanding customer segments in terms of
innovation, technology and quality
Custom made solutions based on most advanced products
and perfect service as key credentials of success
No longer a steel company
| |voestalpine AG3 January 2012 Investor Relations
voestalpine groupBusiness concept (2)
Strategic markets
Focus on market segments with utmost technological andquality requirements, such as energy, automotive,railway and aircraft industry
No spot market business, commodities no option
Long term relationships
Long term partnerships with customers, suppliers and R&D-institutions are key for innovation and permanent progression in technology and quality
Perfect service is key for long term partnerships
First choice for high tech steel solutions
| |voestalpine AG4 January 2012 Investor Relations
Building& constr.
subsuppliers
Railwayinfrastructure
Civil &Mechanical
engineering
Other
White &consumer
goodsAutomotive
Energyindustry
voestalpine groupGlobal footprint
No significant exposure to ailing countries and industries
Germany
Austria
BeneluxItalyFrance
Brazil
OtherEurope
NorthAmerica
Asia ROW
Figures FY 2010/11
| |voestalpine AG5 January 2012 Investor Relations
Minimum top 3 market position in Europe
Partial backward integration
Longest value chain in the industry
Product portfolio focused on long term growth segments
Very limited exposure to crisis-regions and -industries
Resilient in economic downturn
Full leverage in upturn
Strong commitment to efficiency improvement and cost cutting
Steel Special Steel Railway Systems Profilform Automotive
voestalpine groupStructure & position
European Top Player
European Top Player
World market Leader
World market Leader
World market Leader
from April 1st, 2012 on
| |voestalpine AG6 January 2012 Investor Relations
voestalpine group Current situation
voestalpine group in figures
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
3,052 318 10.4
Q2FY 11/12
2,926 214 7.3
1HFY 11/12
5,978 531 8.9
1HFY 10/11
5,192 414 8.0
Unchanged negative sentiment stemming from financial and public sector
Varying macro lead-indicators in recent months
US data with modest upside tendency
European data predicting stuttering development but no recession
China’s growth track at lower pace
Business environment increasingly varying from sector to sector
Instability and high volatility as the “new normal”
| |voestalpine AG7 January 2012 Investor Relations
voestalpine group Reading and reaction
voestalpine strategy and business model have proven resilience in turbulent times
Despite a still volatile general environment, 2012 focus back on strategic expansion after a period of cost cutting and crisis management
Merger of Automotive & Profilform Divisions per April 1st, 2012
Major new automotive investments in China, USA and Europe backed by premium producers
Ongoing volatile business environment expected in H1 2012
Efficiency programs carried forward
Lean and flexible structures help to adopt to fast changing market
environment
Constant control and adoption of stocks over whole supply chain
voestalpine group in figures
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
3,052 318 10.4
Q2FY 11/12
2,926 214 7.3
1HFY 11/12
5,978 531 8.9
1HFY 10/11
5,192 414 8.0
| |voestalpine AG8 January 2012 Investor Relations
Division Steel Business development
Demand situation and price level in high quality segments significantly better than in spot market
Automotive, energy, machine building
Customers still cautious in shorter term market segments
Building/construction, consumer goods, household appliance
Utilization rate of voestalpine’s Linz plant at 90% currently, stable development in Q4 FY 2011/12 expected
Trough of profitability in CQ4 2011Hesitant customers and low volumes due to “proclaimed” recession year 2012
Falling steel prices based on slump in raw material prices
Still high raw material cost because of pricing time lag and stocks
Steel prices start turning positive since beginning of 2012Rising prices in North America
Beginning restructuring of the European supply side
Demand and pricing environment in Europe with first signs of recovery
Division Steel in figures
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
1,038 101 9.8
Q2 FY 11/12
978 60 6.1
1H FY 11/12
2,016 161 8.0
1HFY 10/11
1,785 166 9.3
| |voestalpine AG9 January 2012 Investor Relations
Division Special Steel Business development
Business sentiment stable on level of 2H CY 2011Order intake still attractive, but below peak figures of spring 2011Stable market situation in automotive, oil & gas exploration and aircraft segmentsWeaker demand from power plant construction and-engineering.Regional economic trends of last year are carried forward
Northern and Western Europe stable on solid levels, Southern Europe unchanged weak
North America showing signs of vitalization
South America stable on appealing levels
Economic growth trend in China slowing down to reasonable levels after exceptional phase in last years
Division Special Steel in figures (past ppa)
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
751 83 11.0
Q2FY 11/12
713 59 8.3
1HFY 11/12
1,464 142 9.7
1HFY 10/11
1,237 75 6.1
| |voestalpine AG10 January 2012 Investor Relations
Division Railway Systems Business development
Uneven development in rails businessOn-going solid demand for premium railsExcess capacity in standard rails still weighing on capacity utilization and profitability
Turnout systems business benefit from dynamic markets in South Africa, Australia, Brazil and Turkey
However China slowing down
Slightly weaker demand in wire and welding consumablesUnchanged strong sentiment for seamless tubes driven by North American and Mid East marketsFuture of standard rails production in Europe to be discussed
Division Railway Systemsin figures
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
753 92 12.2
Q2FY 11/12
752 80 10.6
1HFY 11/12
1,504 172 11.4
1HFY 10/11
1,336 129 9.7
| |voestalpine AG11 January 2012 Investor Relations
Division Profilform Business development
Demand from agricultural and construction machinery equipment segments as well as aircraft business on stable high level
Commercial vehicle market softening recently, but demand levels still high
Solar energy business fundamentally good, currently usual seasonal effects
Volatile order intake in standard tubes segment
Continued solid situation in storage technology
Sound business environment in precision strip, just slightly below exceptional level of H1 CY 2011
Division Profilform in figures
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
330 41 12.5
Q2FY 11/12
302 23 7.6
1HFY 11/12
632 64 10.2
1HFY 10/11
557 57 10.3
| |voestalpine AG12 January 2012 Investor Relations
Division Automotive Business development
Mixed environment for European car producersSolid production figures in premium segment, German producers still doing well in general
Stable order intake for Eastern and Central European Transplants
French & Italian car industry weakening
Utilization rates at voestalpine high due to dominant stake of premium producersAutomotive Division strengthens global presence
New greenfield investments in U.S., China, South Africa, Romania and Germany
Capital expenditure bolstered by long term contracts
Solar energy as successful niche-business
Division Automotivein figures
Sales(€m)
EBIT(€m)
EBIT(%)
Q1FY 11/12
293 19 6.3
Q2FY 11/12
292 11 3.8
1HFY 11/12
585 30 5.1
1HFY 10/11
477 25 5.2
www.voestalpine.comvoestalpine AG
Financial overview
| |voestalpine AG14 January 2012 Investor Relations
voestalpine groupConsolidated overview
* Based on average number of shares** Fixed assets and acquisitions*** Per 30.09., excluding trainees & temps
1H 2010/11 1H 2011/12 YoY in %Sales €m 5,192 5,978 15.1EBITDA €m 711 824 16.0% of Sales % 13.7 13.8EBIT €m 414 531 28.3% of Sales % 8.0 8.9EBT €m 317 443 39.7Net Profit €m 250 346 38.6EPS* € 1.24 1.82 46.8
Investments** €m 169 227 34.4Depreciation €m 296 293 -1.2Employees*** 39,862 41,168
| |voestalpine AG
EBIT development1H 2010/11 vs. 1H 2011/12
15 January 2012 Investor Relations
1H 2010/11 PriceRaw
materials Misc.*Mix/
Volume* ppa 1H 2011/12
414 €m
531 €m
EBIT8.0%
4 €m
-328 €m34 €m
396 €m
11 €m
* Savings are included in these items
EBIT8.9%
| |voestalpine AG16 January 2012 Investor Relations
voestalpine groupCash flow 1H 2010/11 vs. 1H 2011/12
1H 2010/11 1H 2011/12
Cash flow from result €m 554 618
Changes in working capital €m -80 -450
Cash flow from operating activities €m 474 168
Cash flow from investing activities €m -221 -232
Free cash flow €m 253 -64
| |voestalpine AG17 January 2012 Investor Relations
voestalpine groupGearing ratio
| |voestalpine AG18 January 2012 Investor Relations
voestalpine groupDevelopment liquidity
Cash
Financial assets
Comfortable liquidity position and balanced maturity profile
Liquidityper 30.09.2011
Redemption – Scheduleper 30.09.2011
€m
*) Syndicated loan: 400 m€, committed lines: 400 m€, closed on November 23, 2011
| |voestalpine AG19 January 2012 Investor Relations
voestalpine groupOutlook
Global macro uncertainty questions short term upturnSentiment still volatile due to public debt situation as well as pending problems in the banking sector and financial markets
GDP-growth expectations generally reduced across 2012 (including China)
Political environment within EU stabilizing, future of Euro no longer seriously questioned
Customers and end-consumers still cautious, but no further deterioration of industrial sentiment expectedDifficult CQ4 for steel industry in general and voestalpine Steel Division, but improved earnings expectations from spring 2012 onwards Stable development in processing divisions carried forward in H1 2012
UPTURN IN THE COURSE OF CY 2012 LIKELY
www.voestalpine.comvoestalpine AG
IR Contact
Peter FleischerHead of Investor RelationsE-Mail [email protected] +43/50304/15-9949
Gerald ReschInvestor Relations ManagerE-Mail [email protected] +43/50304/15-3152
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