Outokumpu Oyj · OMXHEX:OUT1V
Outokumpu Oyj — Q2 2012 Earnings Presentation
20 slides from Outokumpu Oyj's earnings presentation, Jul 20, 2012
Slide 1: Interim Report Q2/2012
Interim Report Q2/2012 20 July 2012 CEO Mika Seitovirta www.outokumpu.com
Slide 2: Agenda
1. Highlights in Q2 2. Stainless markets 3. Efficiency improvement programmes 4. Q2/2012 financials and short-term outlook 5. Inoxum acquisition
Slide 3: Highlights in Q2/2012
Highlights in Q2/2012 • Underlying operational result MEUR -39 (Q1/2012: MEUR 2) • Operating loss MEUR 80 (Q1/2012: MEUR 3 profit) • Raw material-related inventory losses MEUR 8 • Net non-recurring items MEUR -33 • Operating cash flow MEUR 23 (Q1/2012: MEUR 116) • Total external deliveries 402 000 t
Slide 4: Agenda
1. Highlights in Q2 2. Stainless markets 3. Efficiency improvement programmes 4. Q2/2012 financials and short-term outlook 5. Inoxum acquisition
Slide 5: Stainless steel markets in Q2/2012
Stainless steel markets in Q2/2012 • Increased economic uncertainty in Europe • Underlying demand flat to slightly softer • Softening stainless steel markets • Declining nickel price • Approaching summer season • Distributor destocking • Slightly declining base prices
Slide 6: Agenda
1. Highlights in Q2 2. Stainless markets 3. Efficiency improvement programmes 4. Q2/2012 financials and short-term outlook 5. Inoxum acquisition
Slide 7: On-going efficiency improvement programmes progressing well
On-going efficiency improvement programmes progressing well • P100 -cost reduction programme by end of 2012 • 90% of savings in implementation or identified • Full effect of cost savings expected from beginning of 2013 • Remaining Brass operations sold • On-going statutory negotiations in General St
Slide 8: Headcount development
Headcount development – including summer trainees 10 000 9 474 9 500 Summer trainees 9 000 8 452 8 524 8 421 8 453 8 253 8 500 7 968 Summer trainees 8 000 7 656 7 500 7 000 6 500 6 000 5 500 5 000
Slide 9: Further reduction of working capital – improved inventory turnover
Further reduction of working capital – improved inventory turnover Inventory turnover Inventory days to sales 1 800 150 1 500 140 130 1 200 120 900 110 600 100 300 90 0 80
Slide 10: Further reduction of working capital – positive impact from A/P and A/R
Further reduction of working capital – positive impact from A/P and A/R Days 75 70 65 60 A/P turnover 55 days to COGS A/R turnover 50 days to sales 45 40 35 30
Slide 11: Safety improvement work continues
Safety improvement work continues LTI *) for Outokumpu employees and contractors 35 Target 2012 30 < 4.0 25 20 19.0 19.0 18.0 17.0 15 11.0 10 9.0 5.9 6.7 4.7 5.6 5 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 H1 2012 *) Lost time injuries / 1 million working hours
Slide 12: Agenda
1. Highlights in Q2 2. Stainless markets 3. Efficiency improvement programmes 4. Q2/2012 financials and short-term outlook 5. Inoxum acquisition
Slide 13: Key figures Q2 2012
Key figures Q2 2012 EUR million II/2012 I/2012 II/2011 2011 Sales 1 254 1 304 1 281 5 009 EBITDA -12 60 -4 80 Operating result -80 3 -169 -260 EPS, € 1) -0.09 0.04 0.18 -0.64 ROCE, % -8.6 0.3 -16.1 -6.5 External deliveries2), 1 000 tonnes 402 418 365 1 449 Stainless steel external deliveries, 1 000
Slide 14: Capital structure
Capital structure EUR million II/2012 I/2012 II/2011 2011 Net cash generated from operating activities 23 116 -66 338 Net interest-bearing debt 1) 1 691 1 644 1 885 1 720 Equity-to-assets ratio, % 47.6 40.6 40.4 39.8 Debt-to-equity ratio (gearing), % 1) 84.8 78.4 82.0 82.5 1) Q1 and Q2 2012 adjusted
Slide 15: Short-term outlook
Short-term outlook • Outokumpu’s average base prices for stainless steel in Q3 are expected to be slightly lower than in Q2 • Outokumpu’s Q3 external delivery volumes (stainless and ferrochrome) are expected to be clearly lower than in Q2 • The Group’s product and geographic mix is expected to impro
Slide 16: Agenda
1. Highlights in Q2 2. Stainless markets 3. Efficiency improvement programmes 4. Q2/2012 financials and short-term outlook 5. Inoxum acquisition
Slide 17: Creating a global leader in stainless steel – Overview
Creating a global leader in stainless steel – Overview • Acquisition of Inoxum, ThyssenKrupp’s stainless steel business, announced in January 2012 • Three integrated production facilities as well as a broad service center and sales office presence globally • Leading position in Europe with significa
Slide 18: Creating a global leader in stainless steel – Inoxum acquisition update
Creating a global leader in stainless steel – Inoxum acquisition update • Integration planning work on-going • Filing to the European Commission for the regulatory approval done in April 2012 • Regulatory approval expected by the end of 2012 • Phase II entered at the end of May • Review period was e
Slide 19: KUMEU
KUMEU
Slide 20: Interim Report Q2/2012
Interim Report Q2/2012 20 July 2012 CEO Mika Seitovirta www.outokumpu.com