Aurubis Ag · XETR:NDA
Aurubis — DVFA Analyst Conference 2011
37 slides from Aurubis's conference presentation, Feb 9, 2011
Slide 1: Results of operations and strategy of Aurubis AG
DVFA Analyst Conference on 9 February 2011 Results of operations and strategy of Aurubis AG DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 1
Slide 2: Agenda
Agenda 1. Position 2. Trends in the copper markets 3. Fiscal year 2009/10 4. First quarter 2010/11 5. Strategy and outlook DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 2
Slide 3: Group structure with 3 business units to meet requirements of group expansion
Group structure with 3 business units to meet requirements of group expansion Integrated copper processor Mines and Processors and Copper production Copper fabrication recycling markets end users BU Primary Copper BU Copper Products Sulphuric acid Iron silicate Shapes Pre-rolled Strips strip Concent
Slide 4: Mines: dependent on the metal price; Smelters: dependent on raw material availability
Mines: dependent on the metal price Smelters: dependent on the availability of raw materials and the smelter’s processing capacity Mine’s business model Aurubis’ business model (in US$/lb) Processors Mines and Copper Copper and recycling markets production processing end users 3,0 1,4 Aurubis sales
Slide 5: Well positioned production sites in European core market
Well positioned production sites in European core market Production sites and employees (as of December 2010) Primary Copper Recycling / Production Precious Metals Olen: 472 Emmerich: 116 » Lunen Smethwick: 26 » Hamburg Hamburg: 2,155 » Hamburg » Olen » Olen Fehrbellin: 50 » Pirdop » Pirdop Lunen: 5
Slide 6: Aurubis is an internationally leading cathode producer
Aurubis is an internationally leading cathode producer Global copper output from refineries (2010 est; in 1,000 t) Codelco 1,856 Aurubis* 1,144 Freeport McMoran 999 Xstrata 814 Jiangxi 800 Nippon 631 BHP Billiton 573 Tongling 560 KGHM 512 Mitsubishi 505 * Fiscal year 2009/10 Source: Wood Macquenzie,
Slide 7: Aurubis is the leading global copper recycling company
Aurubis is the leading global copper recycling company Copper Total Company / volumes (in t*) scrap recycling Aurubis 280,000 575,000 Metallo Chimique (incl. Elmet) 26,000 300,000 Boliden 35,000 190,000 MW Brixlegg (incl. Krompachy) 90,000 160,000 Xstrata Copper 25,000 105,000 Sumitomo Metal Mining
Slide 8: Leading European wire rod producer with competence and customer proximity
Leading European wire rod producer with competence and customer proximity Wire rod production by major European producers (2010 est.; in 1,000 t) Aurubis* 766 CCI 320 Nexans 240 KGHM 200 MKM 150 Elektrokoppar 150 CuNext 145 * Business year 2009/10 DVFA, 9. Februar 2011 Position Copper market FY 2009
Slide 9: Agenda
Agenda 1. Position 2. Trends in the copper markets 3. Fiscal year 2009/10 4. First quarter 2010/11 5. Strategy and outlook DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 9
Slide 10: Ongoing strong increase in global refined copper consumption but change in regional demand
Ongoing strong increase in global refined copper consumption but change in regional demand Refined copper demand (in mill. t) 2005 2010 2015e 22.2 9.8 18.3 7.2 17.0 3.8 3.9 3.1 2.3 1.6 1.5 3.0 0.4 0.6 1.0 1.1 1.2 1.2 1.3 1.0 0.8 China India US Europe Germany Japan World Refined copper demand per cap
Slide 11: New technologies result in more copper applications
New technologies result in more copper applications Cable Alternative energy Hybrid and electric cars » Expansion of » Expansion of » Increased popularity of electricity grid decentralised energy hybrid cars worldwide continues supply proceeds » Electric drive is the » Underground cable » High coppe
Slide 12: Europe is a major net importer of refined copper
Europe is a major net importer of refined copper • Copper demand by regions 2010 (in mill. t) • Copper surplus / deficit +0.8 0.5 -0.7 -0.5 3.4 1.9 -3.9 12.1 +3.3 +0.5 0.8 0.4 +0.2 0.2 Total demand: 19.3 mill. t in 2010 Source: Brook Hunt 4Q 2010 DVFA, 9. Februar 2011 Position Copper market FY 2009/
Slide 13: Copper price proves to be robust and stays at a high level
Copper price proves to be robust and stays at a high level Copper price and metal exchange inventories in 1,000 t in US$/t 2500 10000 Metal exchange inventories 2250 LME copper price 9000 2000 8000 1750 7000 1500 6000 1250 5000 1000 4000 750 500 3000 250 2000 0 1000 01/04 01/05 01/06 01/07 01/08 01/
Slide 14: Improved market conditions for copper concentrates
Improved market conditions for copper concentrates TC/RCs, copper and acid price Market factors for concentrates TC/RCs Cu price in ct/lb H2SO4 price in US$/t in ct/lb 60 450 » Low demand at the smelters, which are currently well supplied 400 50 » Low capacity utilisation and production 350 cutbacks
Slide 15: Agenda
Agenda 1. Position 2. Trends in the copper markets 3. Fiscal year 2009/10 4. First quarter 2010/11 5. Strategy and outlook DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 15
Slide 16: Substantial increase in results compared to prior year, though inventory build-up burdens net debt
Substantial increase in results compared to prior year, though inventory build-up burdens net debt Key figures (before revaluation of LIFO inventories) 09/10 08/09 » High cathode output despite Concentrate throughput1,000 t 2,063 2,095 difficult concentrate market Cathodes 1,000 t 1,144 1,086 » Earn
Slide 17: Considerable improvement in consolidated key figures 2009/10 year-on-year
Considerable improvement in consolidated key figures 2009/10 year-on-year (IFRS on the basis of LIFO) Actual Actual Difference FY 09/10 FY 08/09 in % Revenues €m 9,865 6,687 +48 Gross profit €m 851 639 + 33 Personnel expenses €m 295 270 +9 Depreciation and amortisation €m 106 106 +1 EBITDA €m 392 21
Slide 18: Very satisfactory earnings generated in improved market environment
Very satisfactory earnings generated in improved market environment EBT 2009/10 (in € mill., rounded up) Q4 09/10 Q4 08/09 » Non-cash valuation effects of copper inventories drove the accumulated LIFO EBT -9 46 37 Main factors influencing results 16 » High utilisation of plants for copper refining a
Slide 19: Sound financial ratios
Sound financial ratios (IFRS on the basis of LIFO) Financial ratios 30.9.2010 30.9.2009 Target Capital structure: - Equity ratio 35 % 35 % > 40 % - Equity-to-fixed-assets ratio 108 % 96 % > 75 % - Working capital in % of the current assets 41 % 37 % 30 - 35 % Debt coverage: - Gearing (financial liab
Slide 20: Agenda
Agenda 1. Position 2. Trends in the copper markets 3. Fiscal year 2009/10 4. First quarter 2010/11 5. Strategy and outlook DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 20
Slide 21: Unsatisfactory results due to standstills and extraordinary effects
Unsatisfactory results due to standstills and extraordinary effects EBT Q1 2010/11 (in € mill., rounded up) 1st quarter 10/11 Q1 09/10 Significant factors affecting results 47 » Operating result burdened by extraordinary effects 0 in the amount of about € 50 million » Lower concentrate throughput an
Slide 22: Consolidated key figures – 1st quarter of fiscal year 2010/11
Consolidated key figures – 1st quarter of fiscal year 2010/11 Selected key figures for the Aurubis Group in accordance with IFRS (average) Q1 10/11 Q1 09/10 Revenues €m 2,732 2,078 Gross profit €m 290 313 Personnel expenses €m 79 69 Depreciation and amortisation €m 26 26 EBITDA €m 168 205 EBIT €m 14
Slide 23: Consolidated key figures 2010/2011 lower than prior year due to negative extraordinary effects
Consolidated key figures 2010/2011 lower than prior year due to negative extraordinary effects (operating; on the basis of IFRS) Actual Actual Q1 10/11 Q1 09/10 Revenues €m 2,732 2,078 Gross profit €m 133 188 Personnel expenses €m 80 69 Depreciation and amortisation €m 26 26 EBITDA €m 12 80 EBIT €m
Slide 24: Effects of metal price increases on earnings under LIFO
When inventories are high, metal price increases weigh on earnings if the LIFO method is applied, for example, for delivered but not price-fixed quantities (DNF) Schematic presentation of effects Effect on earnings from price change Effect on earnings from change in inventories Inventories constant
Slide 25: Gross cash flow close to prior-year level
Gross cash flow close to prior-year level Key figures of the Aurubis Group in the 1st quarter 2010/11 (in € mill.) Q1 Q1 10/11 09/10 EBITDA 168 205 » Gross cash flow slightly reduced due to lower EBT Gross cash flow 148 162 » Net cash flow € 70 million up on prior year Change in net in Q1 working ca
Slide 26: Consolidated financial ratios declined due to Q1 earnings and increase in total assets
Consolidated financial ratios declined due to Q1 earnings and increase in total assets (operating; on the basis of IFRS) 31.12.2010 30.9.2010 operating operating Target Capital structure: - Equity ratio (EK/BS) 29 % 35 % > 40 % - Fixed asset cover (equity/fixed assets) 106 % 108 % > 75 % - Working c
Slide 27: Earnings weighed down by smelter standstill and extraordinary effects
Earnings weighed down by smelter standstill and extraordinary effects Operating result in BU Primary Copper (Q1 10/11) » Copper concentrate processing was burdened by (rounded up in Q1 € million) 10/11 » Standstill for repairs in Hamburg Revenues 1,406 » Scheduled maintenance standstill in Pirdop th
Slide 28: Extraordinary effects and maintenance standstills led to negative operating result in BU Recycling/Precious Metals
Extraordinary effects and maintenance standstills in Hamburg and Lunen led to negative operating result in BU Recycling/Precious Metals Operating result in BU Recycling / Precious Metals (only Q1 10/11) » Good material availability led to attractive refining (rounded up in Q1 charges € million) 10/1
Slide 29: Negative operating result in BU Copper Products due to extraordinary effects
Negative operating result in BU Copper Products due to extraordinary effects despite strong production output Operating result in BU Copper Products (only Q1 10/11) » Continued good demand trend for copper products (rounded up in Q1 € million) 10/11 across all product areas Revenues 1,984 » Firmer U
Slide 30: Agenda
Agenda 1. Position 2. Trends in the copper market 3. Fiscal year 2009/10 4. First quarter 2010/11 5. Strategy and outlook DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 30
Slide 31: Stable shareholder structure
Stable shareholder structure Shareholder structure Basis: 18 January 2011 » IPO in 1998 » Aurubis shares are in ~30% the Prime Standard Salzgitter AG Segment of the Deutsche Börse ~23% » Shares are listed in the Other institutional MDAX, in the investors European Stoxx 600 and in the Global Private
Slide 32: Aurubis to become the leading integrated copper producer and processor worldwide
Aurubis to become the leading integrated copper producer and processor worldwide Growth » Our strategy is to utilise our integrated copper production and processing capability in Global smelting, refining, metal extraction, recycling player and copper processing and thus to generate the highest valu
Slide 33: Improved concentrate supply expected due to new capacities after a 10-year wait
Improved concentrate supply expected due to new capacities after a 10-year wait New capacities with resources of some 250 mill. t copper expected between 2010 and 2015. 90.000 Resource size ('000 t contained Cu) 80.000 Escondida 70.000 Andina Expansion - Phase II 60.000 50.000 Collahuasi Chuquicamat
Slide 34: Positive outlook for fiscal year 2010/11 overall
Positive outlook for fiscal year 2010/11 overall » Global economic recovery will likely continue with less momentum and high copper price » Market improvement for copper concentrates for new contracts will have a positive effect on results in the course of the fiscal year » Increase in concentrate p
Slide 35: Results of operations and strategy of Aurubis AG
Results of operations and strategy of Aurubis AG DVFA, 9. Februar 2011 Position Copper market FY 2009/10 Q1 2010/11 Strategy & Outlook 35
Slide 36: IR Contacts
IR Contacts » Marcus Kartenbeck Head of Investor Relations and Risk Management +49 40 7883-3178 [email protected] » Dieter Birkholz » Ken Nagayama Investor Relations Investor Relations +49 40 7883-3969 and Risk Management [email protected] +49 40 7883-3179 [email protected] DVFA, 9.
Slide 37: Disclaimer
Disclaimer This document contains forward-looking information that involves risks and uncertainties, including statements about Aurubis’s plans, objectives, expectations and intentions. Readers are cautioned that forward-looking statements include known and unknown risks and are subject to significa