Constellium Se · NYSE:CSTM
Constellium — Investor Day (April 2014)
51 slides from Constellium's investor day presentation, Apr 9, 2014
Slide 1: Four Seasons Hotel
FOUR SEASONS HOTEL
Slide 2: Introduction
INTRODUCTION Paul BLALOCK Head of US Investor Relations
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking statements” with respect to our business, results of operations and financial condition, and our expectations or beliefs concerning future events and conditions. You can identify certain forward-looking statements because they co
Slide 4: Management Participants
MANAGEMENT PARTICIPANTS PIERRE DIDIER JEAN-CHRISTOPHE VAREILLE FONTAINE FIGUEROA Chief Executive Officer Chief Financial Officer President, Aerospace of Constellium of Constellium & Transportation ￭ Former Chairman and CEO of ￭ Prior to joining Constellium, ￭ Prior to joining Constellium in FCI (glo
Slide 5: Four Seasons Hotel
FOUR SEASONS HOTEL
Slide 6: Pierre Vareille, Chief Executive Officer
Pierre VAREILLE Chief Executive Officer 6
Slide 7: Continuing Our Evolution by Expanding Our Free Float
CONTINUING OUR EVOLUTION BY EXPANDING OUR FREE FLOAT Shares Of Constellium (In Millions) ∑= 105.0 ∑= 105.0 ∑= 105.0 ∑= 105.0 ∑= 105.0 20.3 Free float (19.3%) 39% 40.4 (38.5%) 50.4 (48.0%) 19,3 Rio Tinto 28.9 (27.5%) 76.0 (72.4%) 88.6 0.8 9.6 9.6 Rio Tinto / (9.1%) (84.4%) Management Rio Tinto Second
Slide 8: Overview of Key Achievements
OVERVIEW OF KEY ACHIEVEMENTS DELIVERED STRONG FINANCIAL PERFORMANCE PURSUING GROWTH OPPORTUNITIES Business positioned to generate strong cash flows Announced plans for a joint venture with UACJ to with low leverage supply aluminum auto body sheet to the North American automotive industry Executed on
Slide 9: Constellium's Product Focus
CONSTELLIUM’S PRODUCT FOCUS Global aluminum fabrication market by production technology and product segment Global Aluminum Rolled & Extruded Product Segment ® Rolled Our Specialty Proprietary Aerospace Focus alloys 31% 30% Aero plates & sheets Our Bright, closures, other specialty Focus Auto Body S
Slide 10: Constellium at a Glance
CONSTELLIUM AT A GLANCE Aerospace Automotive Packaging Market Growth Forecast: 8% Market Growth Forecast: 18% Market Growth Forecast: 3% Crash Management Systems: #2 Worldwide Can Body Stock: #1 Europe Aerospace Plates: #1 Worldwide Major European Player in Auto Body Sheet Closures: #1 Worldwide 201
Slide 11: Long-Standing Relationships with a Global, Blue-Chip Customer Base
LONG-STANDING RELATIONSHIPS WITH A GLOBAL, BLUE-CHIP CUSTOMER BASE Key driver: Aerospace Global demand 8% Europe growth rate for aerospace Market value $4.5 trillion Other Key driver: Substitution Automotive Asia 15% Pacific driven by regulation North 21% 42% 18% America growth rate for aluminum 22%
Slide 12: Strategies and Priorities for Our Unique Portfolio of Businesses
STRATEGIES AND PRIORITIES FOR OUR UNIQUE PORTFOLIO OF BUSINESSES 1. Focus on high value add products, customers and markets 2. Increase productivity, efficiency, and safety Lean transformation for continuous improvement Sustainability is integrated into our practices and procedures 3. Operate the bu
Slide 13: Broad Range of Automotive Products for US and Europe
BROAD RANGE OF AUTOMOTIVE PRODUCTS TO SERVE OUR CUSTOMERS IN BOTH THE US AND EUROPE FOR EXTRUSIONS AND BiW SURFALEX® STRONGALEX® SURFACE STRENGTH EXCELLENCE CRASH HIGH FORMABILITY FORMALEX® SECURALEX® 13
Slide 14: Well-Positioned to Capture BiW Growth Opportunities
WE ARE WELL-POSITIONED TO CAPTURE BiW GROWTH OPPORTUNITIES GLOBAL ALUMINIUM BiW MARKET FORECAST (Kt) CONSTELLIUM WELL-POSITIONED TO CAPITALIZE 6x 1800 200 CAGR ’12-‘20 We are joining forces with UACJ to supply auto body sheet to the North American auto industry STATES UNITED with initial target capa
Slide 15: Global Leader in Automotive Structures
GLOBAL LEADER IN AUTOMOTIVE STRUCTURES Aluminum Body Structure market (k tons) 300 Key AS products in cars 250 200 NA 35% pa 125 150 100 45 32 115 50 14 72 Europe 29 42 0 2012 2015 2020 2025 Aluminum CMS market (M units) 30 Automotive Structures designs, engineers 25 11% pa China and manufactures a
Slide 16: Leading Position in European Packaging
LEADING POSITION IN EUROPEAN PACKAGING – OUR “BEDROCK” OF CASH GENERATING SEGMENT Increased Use Of Aluminum In Europe, And With Room To Go Resulting In Increased Aluminum Can Stock Consumption % Breakdown of Cans Sold Can Stock Consumption (kt) CAGR 2012-2017E 955 22% 866 42% 248 +4% 235 78% 58% 631
Slide 17: Canstock Strategy to Maintain Leadership Position
CANSTOCK STRATEGY TO MAINTAIN LEADERSHIP POSITION STABLE AND GROWING MARKET European beverage market to expand from 78% aluminum to 85% in 2016 Work with can customers in conversion opportunities Solid cash generation and good economic resiliency PURSUE OPERATIONAL AND COMMERCIAL EXCELLENCE Technolo
Slide 18: Aerospace: Critical Supplier of Aluminum Products
AEROSPACE – CONSTELLIUM IS A CRITICAL SUPPLIER FOR A COMPREHENSIVE RANGE OF ALUMINUM PRODUCTS Leader in Aluminum Lithium #1 Worldwide technology through AIRWARE® uniquely suited for higher volumes in aerospace plates; one of two through new casting capacity suppliers with dual continent footprint At
Slide 19: Four Seasons Hotel
FOUR SEASONS HOTEL
Slide 20: Didier Fontaine, Chief Financial Officer
Didier FONTAINE Chief Financial Officer
Slide 21: Strong Segment Performance Improvement
STRONG SEGMENT PERFORMANCE IMPROVEMENT Adjusted EBITDA (€m)* Adjusted EBITDA (€) per metric ton % 491 A&T 120 105 469 2012 2013 2012 2013 311 AS&I 59 46 223 2012 2013 2012 2013 105 176 P&ARP 152 92 2012 2013 2012 2013 *May not sum to consolidated figures due to corporate allocations Source: Company
Slide 22: Automotive and Aerospace Product Mix
AUTOMOTIVE AND AEROSPACE PRODUCT MIX 12% 21% 32% Volume Group 2011 2013 2018 Estimated Adjusted EBITDA per € 145 for 2011 € 273 for 2013 € 300+ for 2018 Estimated metric ton 15% 42% Adjusted EBITDA 58% 2011 2013 2018 Estimated 22
Slide 23: Investments and Capital Spending Roadmap
INVESTMENTS AND CAPITAL SPENDING ROADMAP BiW Europe €200 million 2014 thru 2018 AIRWARE Europe €70 million1 2014 thru 2018 BiW US $50-100m 2 2015 thru 2018 BiW US JV 51% of $150 million3 2014 thru 2018 Total Growth Projects €380 million 2014 thru 2018 Existing Operations €145 million annually 2013 t
Slide 24: Investments and Capital Spending Plan
INVESTMENTS AND CAPITAL SPENDING PLAN (€m) 189 57 102 € 145 30 € 120 4 144 145 140 125 125 120 2013A 2014E 2015E 2016E 2017E 2018E € 144 € 202 € 329 € 227 € 155 € 124 Existing Operations Growth Projects 24
Slide 25: Strong Balance Sheet with No Near Term Maturities
STRONG BALANCE SHEET WITH NO NEAR TERM MATURITIES € millions 2013 Total Debt 365 Our objective is to keep minimum Cash and Cash Equivalents 233 headroom between €250/300 Net Debt 132 million at any point in time. Peak net leverage due to Net Debt/ seasonality projected to reach 1.4 0.5x LTM Adjusted
Slide 26: Our Business Model
OUR BUSINESS MODEL PROFITABILITY We are a value-added leader in converting RISK MANAGEMENT aluminum into highly profitable products Our business model Focus on selected high-end We hedge to minimize the volatility of our products and high-growth markets is to add value cash flow resulting from movem
Slide 27: Analyst Day, Four Seasons Hotel
EEE ANALYST FOUR SEASONS HOTEL $ Constetlium ;
Slide 28: Focus on Aerospace
FOCUS ON AEROSPACE Jean - Christophe FIGUEROA President, Aerospace & Transportation
Slide 29: Sustained Demand Ensured for At Least Two Decades
SUSTAINED DEMAND ENSURED FOR AT LEAST TWO DECADES CONTINUOUS GROWTH AHEAD THE HIGHEST BACKLOGS IN HISTORY 40 000 Backlog values mid 2013 [2013 $bn] 30 000 20,930 – 59% 343 35,280 334 Units 20 000 14,350 – 41% 10 000 5,960 0 2012 airplanes 2032 airplanes 20,310 41,240 Fleet growth Fleet replacement F
Slide 30: Strong Aerospace Growth Trends
STRONG AEROSPACE GROWTH TRENDS Deliveries of Airware intensive planes pick up in 2014 Growth Drivers 2012-2017 Jet Airplanes deliveries * Other Demand is driven by: AIRWARE ® Intensive Planes* 1940 Replacement of aging fleets 1820 Increasing global passenger air traffic (particularly +8% in emerging
Slide 31: Product Strategy at Airbus and Boeing Favoring Aluminum
PRODUCT STRATEGY AT AIRBUS AND BOEING LARGELY FAVORING ALUMINUM SHARE OVER OTHER MATERIALS “SINGLE-AISLE” IS A HIGHLY ALUMINUM THE DERIVATIVES STRATEGY INTENSIVE SEGMENT Major OEMs Airbus and Boeing have opted for derivatives of their successful models to quickly Single-aisle represent a large share
Slide 32: Aluminum Industry Well Positioned for Aerospace Needs
THE ALUMINUM INDUSTRY IS WELL POSITIONED TO RESPOND TO THE AEROSPACE INDUSTRY’S NEEDS AND CHALLENGES ENABLING HIGH AIRCRAFT PRODUCTION RATE The aluminum supply chain is perfectly suited to meet the industry’s forecasted ramp-up COST EFFICIENT PRODUCTION Aluminum designs are the most cost-effective a
Slide 33: Leader in Flat Rolled Products for Aerospace
CONSTELLIUM IS A LEADER IN FLAT ROLLED PRODUCTS FOR AEROSPACE A COMPLETE OFFER FOR AIRCRAFT MANUFACTURING KEY Capability for extra thick plates to cover all machined applications LEADERSHIP Sheet shop that enables very thin fuselage skins POSITIONS A large panel of extruded products No.1 world-wide
Slide 34: Manufacturing Network Located Where Clients Need Us
OUR MANUFACTURING NETWORK IS LOCATED WHERE OUR CLIENTS NEED US CONSTELLIUM AEROSPACE Located in both Europe and North America Close to main customers’ supply chain networks Unique knowledge in serving a complex network of customers/Tier-1s and Tier-2s, Developed a strong sales network in Asia Two ma
Slide 35: Strategy to Increase Profits Based on Strong Differentiation
STRATEGY TO INCREASE PROFITS BASED ON STRONG DIFFERENTIATION 50 Strong partner STRENGTHEN patent labs portfolio worldwide ENABLE PROPRIETARY INDUSTRIAL SOLUTIONS Investing in RAMP-UP PORTFOLIO AIRWARE® expansion Propose added- value to Delivery OEMs OTIF Focus sales on Speciality alloys GAIN EFFICIE
Slide 36: AIRWARE, a Game Changer for Aerostructures
AIRWARE®, A GAME CHANGER FOR AEROSTRUCTURES AND OUR BUSINESS MODEL BENEFITS FOR AIRCRAFTS INDUSTRIAL SET-UP AIRWARE® Weight reduction that Constellium has invested in may be achieved World First technology delivers the 1 st industrial scale AIRWARE w/o redesign AIRWARE w/ redesign weight savings for
Slide 37: Business Model Built on Long Term Contracts
OUR BUSINESS MODEL IS BUILT ON LONG TERM CONTRACTS MAJOR CONTRACTS 2009 2010 2012 2014 2020 Multi-year contract with Boeing $2bn contract with Airbus for all its programs AIRWARE® selected by Bombardier for its new CSeries AIRWARE® selected by Airbus for the A350 XWB BUSINESS VISIBILITY 90% of Const
Slide 38: Key Take Aways
KEY TAKE AWAYS 1. 2. Aerospace market will show sustainable Aluminum is the predominant material growth in the long run for airframes 3. 4. Constellium is an aerospace technology AIRWARE®, Constellium’s latest leader with a set of proprietary technology is a game changer for our technologies and uni
Slide 39: Four Seasons Hotel
FOUR SEASONS HOTEL
Slide 40: Questions & Answers
Questions ~Answers Constellium
Slide 41: Four Seasons Hotel
FOUR SEASONS HOTEL
Slide 42: Conclusion
EEE” Conclusion $ Constetlium
Slide 43: Four Seasons Hotel
FOUR SEASONS HOTEL
Slide 44: IFRS Statements
IFRS Statements Constetlium
Slide 45: IFRS Balance Sheet
IFRS—BALANCE SHEET € millions December 31, 2013 December 31, 2012 Non-current assets 674 594 Current assets 1069 1037 Assets held for sale 21 Total Assets 1764 1631 € millions December 31, 2013 December 31, 2012 Equity 36 (37) Non-current assets 970 923 Current assets 749 745 Liabilities held for 9
Slide 46: IFRS Income Statement
IFRS—INCOME STATEMENT Year ended Year ended € millions December 31, 2013 December 31, 2012 Revenue 3495 3610 Income from operations 209 263 Other expenses (27) (3) Finance costs—net (50) (60) Share of profit (loss) of joint-ventures 3 (5) Income before taxes 135 195 Income tax expense (39) (46) Net
Slide 47: Non-GAAP Measures Reconciliations
Non-GAAP Measures Reconciliations
Slide 48: Net Debt
NET DEBT As December 31, As December 31, € millions 2013 2012 Borrowings 348 158 Fair value of cross currency interest 26 14 swap Cash and cash (233) (142) equivalents Cash pledged for issuance of (9) (13) guarantees Net Debt 132 17 Fourth Quarter 2013—Earnings Call 48
Slide 49: Adjusted Free Cash Flow
ADJUSTED FREE CASH FLOW Year Ended Year Ended € millions December 31, 2013 December 31, 2012 Cash flow from 184 246 operating activities Margin calls included in cash flow from (4) (7) operating activities Cash flow from operating activities 180 239 excluding margin calls Capital expenditure (144) (
Slide 50: Adjusted EBITDA
ADJUSTED EBITDA Year ended Year ended € millions December 31, 2013 December 31, 2012 Shipments 1025 1033 Revenue 3495 3610 Net Income from continuing operations 96 149 Income tax expense 39 46 Income before income tax 135 195 Finance costs—net 50 60 Other expenses/share of results of joint-ventures
Slide 51: Four Seasons Hotel
FOUR SEASONS HOTEL