El Ezz Aldekhela Steel-alexandria · EGX:IRAX
El Ezz Aldekhela Steel-alexandria — Al Ezz Steel Rebars S.A.E. — FY2008 Earnings Presentation
23 slides from El Ezz Aldekhela Steel-alexandria's earnings presentation, Apr 22, 2009
Slide 1: FY 2008 Financial Results Presentation
Al Ezz Steel Rebars S.A.E. FY 2008 Financial Results Presentation 22 April 2009
Slide 2: Disclaimer
Disclaimer Al Ezz Steel Rebars S.A.E. (“ezzsteel” or “ESR”) give notice that: The particulars of this presentation do not constitute any part of an offer or a contract. The information contained in this presentation may contain certain projections and forward-looking statements that h reflect fl the
Slide 3: Key highlights
Key highlights 2008 was an exceptional year First 9 months enjoyed record demand and prices L t quarter Last t experienced i d unprecedented d t dd decline li iin prices i and d volumes l Ezzsteell enjoyed j d record d sales l and d profitability fi bili in i 2008 despite d i Q4 turbulence b l Stren
Slide 4: Steel market overview
Steel market overview Total world crude steel output rose strongly during the first nine months of 2008 Widespread production curtailment during fourth quarter, in response to global economic downturn, lead to an overall 1.1 per cent decline for 2008 This h decline d l was most pronounced d in devel
Slide 5: Overview of domestic steel market
Overview of domestic steel market 2007 Finished Steel Consumption Per Capita Despite the global slowdown, local demand remains 600 500 very strong, particularly in respect of private home 400 ((kg) building 300 556 626 463 200 354 280 292 315 100 173 69 115 123 - Government stimulus package includes
Slide 6: Domestic market share
Domestic market share 2008 flat products 2008 long products Market size: 958k tonnes , Market size: 5,001k tonnes Makaby Others Imports 2.5% 14.4% 20% Bourieni 2.7% Attal ezzsteel 5.5% ezzsteel 58% EISCO 62.4% 23% Beshay 12.5% 6
Slide 7: Key highlights
Key y highlights g g Production Revenue 6000 4,834 21,792 5000 4,608 20,000 EGP Milllions 16,159 4000 nes 15,000 '000s Tonn 3000 10,000 2000 5,000 1000 0 0 2007 2008 2007 2008 EBITDA Net Income 5,000 4,468 1,250 1,223 Millions 3,991 1,200 4,000 EGP Millions EGP M 1 150 1,150 1,122 , 3,000 1,100 2,00
Slide 8: Full year 2008 production
Full year 2008 production 2,000 1,759 1,812 1,367 1,373 1,500 nes '000 Tonn 1,000 932 775 695 729 500 0 EZDK Long EZDK Flat ESR Long EFS Flat 2007 2008 8
Slide 9: 2008 sales breakdown
2008 sales breakdown By product By market Export Flat EGP 4,302m EGP 6,777m 20% 31% Long EGP 14,867m Domestic 69% EGP 17,489m 17 489m 80% Ezzsteel generates the largest portion of its revenues in its growing domestic market, where it enjoys a leading position 9
Slide 10: Full year 2008 revenues
Full year 2008 revenues Consolidated revenues EGP M Mn ESR/ESM EZDK EFS ezzsteel Long 6,565 8,302 14,867 Flat 3,145 3,633 6,778 Others 0.4 142 5 148 Total 6 565 6,565 11 589 11,589 3 638 3,638 21 792 21,792 Standalone Sales 6,566 11,639 3,848 10
Slide 11: Full year cost breakdown
Full y year cost breakdown EGP Mn 2007 2008 Sales 16,159 21,792 COGS 12,511 17,493 COGS/Sales 77% 80% 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2007 2008 Raw Materials Energy Labour Depreciation & Overheads 11
Slide 12: Profitability
Profitability y 5 000 5,000 4,467 4,500 4,299 3,990 4,000 3 648 3,648 EGP 3,500 3,000 2,500 2,000 Gross Profit EBITDA 2007 2008 12
Slide 13: Profitability per tonne
Profitability ypper tonne 1,000 965 929 900 815 800 745 EGP 700 600 500 Gross Profit Per Tonne EBITDA Per Tonne 2007 2008 13
Slide 14: Robust balance sheet
R Robust b tb balance l sheet h t Successful completion of the EGP1.1 billion bond issue in June Capital increase of EGP1.8 EGP1 8 billion by way of a rights issue in September Stake in EZDK increased from 50.28% to 53.24% Cash on hand at the end of the period amounted to EGP 4.1 billion ezzsteel’s
Slide 15: Commitment to growth strategy
Commitment to growth strategy ezzsteel’s expansion to continue Vertical integration Capacity expansion Prioritisation of projects to ensure optimal economic returns Ultimate objective is to ensure that EZDK’s performance is replicated at all other business units 15
Slide 16: Outlook
Outlook Volumes Local demand remains very strong, in particular private home building and infrastructure projects Government stimulus package expected to support demand for long products Flat steel exports remain ezzsteel’s only exposure to weak global markets Prices Domestic prices linked to global
Slide 17: Summary
Summary Record sales and profitability Buoyant local market demand for long product off setting weaker export markets Healthy balance sheet with high levels of cash and low gearing Growth strategy to continue 17
Slide 18: Q&A
Q&A
Slide 19: Divisional Review: EZDK
Divisional Review: EZDK EZDK (Alexandria) Sales: FY 2008 FY 2007 % change Value: EGP 11.6 bn EGP 8.8 bn +33% Volume: Long: 1,785 thousand ton 1,824 thousand ton -2.1% Flat: 687 thousand ton 770 thousand ton -10.8% % Exports as % of Sales: Long: 1% 10% Flat: 41% 47% EBITDA: EGP 4.3bn EGP 3.4bn +26.8%
Slide 20: Divisional Review: ESR / ESM
Divisional Review: ESR / ESM ESR/ESM ( Sadat City & 10th of Ramadan) Sales: FY 2008 FY 2007 % change Value: EGP 6.6 bn EGP 4.5 bn +44.7% Volume: 1,381 thousand ton 1,394 thousand ton -1% Exports as % of Sales: 0% 8% EBITDA: EGP 148 mn EGP 314mn -52.7% Production: Long Products: 1,373 thousand ton 1,
Slide 21: Divisional Review: EFS
Divisional Review: EFS EFS (Suez) Sales: FY 2008 FY 2007 % change Value: EGP 3.6 bn EGP 2.9 bn +24.3% Volume: 770 thousand ton 891 thousand ton -13.6% Exports as % of Sales: 80% 71% EBITDA: EGP 21mn EGP 287 mn -92.7% Production: Flat Products: 728 thousand ton 932 thousand ton -21.9% Ownership in EF
Slide 22: ezzsteel at a Glance
ezzsteel at a Glance Ezz Industries Free Float 65.2% 34.8% The largest steel producer in the Middle East and Africa ith a total with t t l actual t l capacity it of 5.3mn tonnes per annum 3.1mn tonnes of long p products 2.2mn tonnes of flat 90.7% products t l is ezzsteel i listed li t d on the th EG
Slide 23: Relative share performance vs EGX30
Relative share performance vs EGX30 160 52 week high: 35 12 5 May 08 35.12, 52 week low: 4.54, 9 Feb 09 140 Adjusted for rights issue, excluding dividends mance (rebased to 100) Average g daily y volume: 2.2m 120 100 Relative perform 80 60 40 20 0 ezzsteel EGX 30 23 * Share price includes dividends
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