Cognor Holding Sa · GPW:COG
Cognor Holding Sa — Q3 2018 Earnings Presentation
19 slides from Cognor Holding Sa's earnings presentation, Nov 6, 2018
Slide 1: Q3 2018 Business and Financial Performance
Q3 2018 Business and Financial Performance November 06, 2018
Slide 2: Agenda
1. Introduction 2. Business Overview 3. Financials 4. Q4 2018 Outlook 5. Financing 2
Slide 3: Introduction | Speaker
Introduction | Speaker Krzysztof Zoła Board Member, CFO Responsibility Cooperation with financial institutions Budgeting and controlling Experience with Cognor since 2002 Board Member of Cognor Holding since 2013 CFO for 12 years 3
Slide 4: Introduction | Q3 2018 Highlights
Introduction | Q3 2018 Highlights Polish GDP growth estimated at ca 4.5% in Q3 2018 compared to 4.7% in Q3 2017; 5.1% in Q2 2018; EU28 GDP growth at 1.9% in Q3 2018 (1,7% Eurozone), compared to 1,7% in Q3 2017; 2.4% in Q2 2018 (2,3% Eurozone) Polish steel production decreased by 11.1%; in the
Slide 5: World's Steel Output
Business Overview | World’s Steel Output Crude steel production and finished products demand CRUDE STEEL PRODUCTION Q3 2018 % YoY Q3 2017 m tonnes Europe 76.3 -0.1% 76.4 EU growth positive UE (28) 40.6 0.7% 40.3 Poland 2.33 -11.1% 2.62 Poland lower due to maintenance of one furnace at AM CIS 25.7 0.
Slide 6: EU Safeguard
Business Overview | EU Safeguard In July 2018 the European Commission introduced a temporary measure aimed at safeguarding the EU market against the potential increase of imports of steel products resulting from the introduction of US section 232 (25% tax for steel import). Twenty nine product group
Slide 7: BOF / EAF Feedstock Cost
Business Overview | BOF / EAF Feedstock Cost BOF & EAF Feedstock Costs Feedstock 2016 2017 2018 2011 2012 2013 2014 2015 2016 2017 Cost Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3* USD / Tonne BOF 470 372 363 284 190 189 257 159 180 182 236 287 251 249 242 285 259 271 EAF 436 423 388 352 257 216 299 192 233 20
Slide 8: Ferrostal Prices & Spreads
Business Overview | Ferrostal Prices & Spreads Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 (pln/ tonne) FERROSTAL SCRAP METAL - average purchase price 1 049 1 102 1 123 1 063 1 036 scrap metal price up by 14 & 1.3% BILLETS - average price 2 103 2 183 2 157 1 491 1 660 billet sales price up by 307 & 17.1
Slide 9: HSJ Prices & Spreads
Business Overview | HSJ Prices & Spreads Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 (pln/ tonne) HSJ SCRAP METAL - average purchase price 1 191 1 223 1 126 1 102 1 000 scrap metal price up by 89 & 8.1% BILLETS - average price 2 652 2 705 2 448 2 279 2 135 billet sales price up by 373 & 16.4% volume 12
Slide 10: Scrap Metal
Business Overview | Scrap Metal Segments SCRAP METAL Q3 2018 Q2 2018 Q3 2017 PURCHASES FROM EXTERNAL SUPPLIERS Tonnes FERROSTAL 65 861 86 927 63 566 ZŁOMREX 81 919 87 989 84 150 ZŁOMREX purchases down by 2.7% HSJ 47 420 48 767 41 138 INTERNAL USE Tonnes FERROSRAL 103 220 122 148 107 867 HSJ 68 452 7
Slide 11: Billets
Business Overview | Billets Segments BILLETS Q3 2018 Q2 2018 Q3 2017 PURCHASES Tonnes FERR 0 0 0 PRODUCTION Tonnes FERR 91 972 109 658 96 112 HSJ 60 130 68 393 58 711 INTERNAL USE Tonnes FERR 89 125 77 255 73 853 HSJ 50 688 55 880 46 403 SALES TO EXTERNAL CUSTOMERS Tonnes FERR 22 450 19 662 33 362 H
Slide 12: Finished Products
Business Overview | Finished Products Segments FINISHED PRODUCTS Q3 2018 Q2 2018 Q3 2017 PURCHASES Tonnes ALL ENTITES 0 0 0 PRODUCTION Tonnes ZWWB 18 352 17 124 20 086 HSJ 47 062 52 171 45 864 PROFIL 66 858 56 414 50 211 SALES TO EXTERNAL CUSTOMERS Tonnes FERROSTAL 87 455 69 338 102 805 HSJ 52 115 5
Slide 13: Statement of Profit or Loss
Financials STATEMENT OF PROFIT OR LOSS Q3 2018 Q2 2018 Q3 2017 '000 PLN Sales revenue 550 666 535 702 495 137 Revenues up by 11.2% Cost of sales -474 323 -453 760 -448 452 Gross profit 76 343 81 942 46 685 Gross profit up by 63.5% Other income 2 429 3 563 1 680 Distribution expenses -21 646 -17 403
Slide 14: Financials: Assets
Financials ASSETS Q3 2018 Q2 2018 Q3 2017 '000 PLN A. TOTAL NON-CURRENT ASSETS 385 320 392 853 409 075 I. Intangible assets 21 283 19 670 12 467 Increase of intangible assets due to R&D costs II. Property, plant and equipment 280 631 280 947 288 196 CAPEX 10.5m (LTM 34.9) III. Other receivables 297
Slide 15: Financials: Equity and Liabilities
Financials EQUITY AND LIABILITIES Q3 2018 Q2 2018 Q3 2017 '000 PLN A. EQUITY 303 049 270 944 184 438 Equity up by 118.6m I. Issued share capital 178 066 177 923 152 175 (LTM net profit, SPO proceeds PLN 39.8, dividend II. Reserves and retained earnings 104 863 75 270 16 219 PLN11.9) III. Minority in
Slide 16: Cash Flow and Main Metrics
Financials Working capital inflow 11.3m CASH FLOW Q3 2018 Q2 2018 Q3 2017 (decrease of inventories & payables; '000 PLN increase of receivables) A. OPERATING ACTIVITIES 51 830 38 960 78 738 CF CAPEX (-) 14.2m B. INVESTING ACTIVITIES -13 717 -9 942 -4 473 CF asset dispositions 0.8m C. FINANCING ACTIV
Slide 17: Q4 2018 Outlook | Main Factors
Q4 2018 Outlook | Main Factors 1 2 3 Polish EAF crude steel production stable at a very high utilization rate. Polish Overall demand dynamics lower as steel consumption further increasing, Slight weakening of GPD growth for compared to Q3 2018; holiday season including rebars, along with Poland and
Slide 18: Financing
Financing In February 2014 Cognor has closed the financial restructuring transaction by issuing: - EUR 100m of senior notes maturing February 2020; coupon 7.5% years 1-2; 10% year 3; 12.5% years 4-6, - EUR 25m of exchangeable notes February 2021; coupon 5%. The notes are exchanged mandatorily into
Slide 19: COGNOR SA contact details
COGNOR SA ul. Zielona 26, 42 - 360 Poraj tel. +48 34 316 01 10, fax +48 34 316 01 12 [email protected], www.cognor,pl 19