Corporate Presentation 1Q18 Results

Transcription

1 Corporate Presentation Results

2 Sergio Malacrida CFO Votorantim S.A.

3 Osvaldo Ayres CFO Votorantim Cimentos

4 OPERATIONAL RESULTS ARGENTINA EXPANSION Highlights JUNTOS SOMOS + ADJ. EBITDA R$235 MILLION + 28% LIABILITY MANAGEMENT STARTUP OF OLAVARRIA EXPANSION WIND FARM MOROCCO PARTNERSHIP WITH GERDAU AND TIGRE GROSS DEBT REDUCTION AND LOWER COSTS 90% OF ANNUAL POWER CONSUMPTION TO BE GENERATED BY WIND FARM 4

5 Consolidated Result R$ million Volume (Mt) Net Revenues (1) Adjusted EBITDA +5% +11% +28% , (16) , (38) +13% -4% +20% +15% 84% N.A. 32% 46% 235 Margin % 8 10 (1) VCBR numbers include eliminations 5

6 Results by Region R$ million VCBR (1) VCNA VCEAA VC Latam (2) Net Revenues Adjusted EBITDA Net Revenues Adjusted EBITDA Net Revenues Adjusted EBITDA Net Revenues Adjusted EBITDA 1, (27) , Growth driven by adjacencies products (concrete and mortars) and economic rebound Weather conditions negatively impacted adjusted EBITDA Strong adjusted EBITDA margin on the back of increased sales, in Turkey and India, and operational efficiency Higher exports along with maturing of Bolivia expansion positively impacting results (1) VCBR numbers include eliminations (2) Argentina: consolidated through equity method 6

7 R$ million Free Cash Flow Cash Generation Capex % (741) (45) (184) (735) 83 (198) (49) (18) (918) Expansion Non expansion Adjusted EBITDA Working capital/others (1) Income taxes Capex CFO Investments/ Divestments Financial result Derivatives linked to debt prepayment FX effect on cash FCF Working capital Highly impacted by businesses seasonality, specially at VCNA Financial results Reduced financial expenses due to gross debt reduction along with lower costs and interest rates in Brazil Capex 35% decrease YoY Moving towards the end of investment cycle. (1) Others: items that do not represent changes in cash 7

8 Liquidity Position and Debt Amortization Profile R$ billion Net Debt (1)(2) Net Debt / Adjusted EBITDA Debt Amortization Schedule (Pro Forma) (4) Revolving Credit Facilities (3) Cash BRL (19%) Foreign Currencies (81%) 4.97x 5.76x 5.71x 6.10x 5.12x 5.53x Average debt maturity: ~10.6 years Cash position covers ~ 3.1 years of debt amortization Q16 2Q17 3Q17 4Q (5) Despite higher LTM adjusted EBITDA, leverage negatively impacted by businesses seasonality in Ongoing Liability Management R$950 million gross debt reduction in Pro Forma (4) combined with financial expenses reduction and extended amortization schedule (1) Net debt includes MTM from 4131 loans (2) 2017 ratios of 1Q, 2Q and 3Q restated considering assets sales (Florida and China) (3) VCSA revolving credit facility of US$700 million due in In addition, does not consider VCNA revolving facility of US$230 million due in 2020 (4) Considers R$350 million of Debentures and R$113 million of BNDES prepaid under subsequent events (5) Considers ~R$450 million ongoing debt prepayment allocated on current liabilities 8

9 Luciano Alves CFO CBA

10 Market and Sales Market Fundamentals Aluminum Sales Volume (ktons) LME Price (1) Regional Ingot Premiums (US$/ton) (2) R$/ton US$/ton +20% 5,815 7, % 2,159 1, % % % Dowstream Upstream % US Midwest Japan Europe US tariffs led to uncertainties regarding global commercial trade flow and increased volatility on LME prices and US Midwest premium. 19% total sales volume increase. Focus on sales profitability in strategic markets. (1) Average of the daily settlement prices, as traded on the London Metal Exchange (LME) (2) US Midwest premium Platts / Japan Premium Platts / European Rotterdam Aluminum Ingot Premium Duty Paid Harbor Aluminum 10

11 Operational Results R$ million Net Revenues (1) Adjusted EBITDA CBA Consolidated (1) Aluminum Nickel Energy 1, % 3 1, (37) % Aluminum Margin(%) Aluminum Energy Nickel Results benefited by higher all-in aluminum prices, improved operational efficiency, sales profitability and accruals reversal. energy results negatively affected by the return of energy auctioned in (1) Considers participation in BAESA and ENERCAN. 11

12 Liquidity Position and Debt Amortization Profile R$ billion Net Debt Net Debt / Adjusted EBITDA Debt Amortization Schedule (Pro Forma) (1) Cash BRL (31%) Foreign Currencies (69%) 5.25x 4.41x x Average debt maturity: 5.0 years (2) Consistent leverage reduction on the back of increasing adjusted EBITDA and stable net debt No relevant maturity until 2024 Strong liquidity: cash position covers ~ 6.2 years of debt amortization (1) Pro forma considers R$687 million capital reduction occurred on April/18, which included (i) transfer of related party assets and liabilities, (ii) cash transfer of R$206 million, and (iii) transfer of 2021 bonds of R$836 million (2) CBA is able to borrow under VSA s US$500 million revolving credit facility which matures on

13 Raul Cadena CFO Votorantim Energia

14 Operational Performance and Sales Power Generation Energy Trading Generation (MWavg) Sales Volume (MWavg) Price (1) (R$/MWh) Sales Volume (MWavg) Spot Price (2) (R$/MWh) Generation Installed capacity [MW] Assured energy -7% +26% Expected generation Market 1,980 1,845 1,226 62% 1,145 62% Votorantim Companies % % % Capacity factor 24 Generation low energy generation below assured energy due to weak wind season during Energy trading sales volume impacted by decrease in sales to industrial customers and distribution companies (1) Average contract price (2) Average energy price in the Southeast and Midwest regions in Brazil (PLD), according to CCEE 14

15 Energy Results R$ million Net Revenues Adjusted EBITDA Adjusted EBITDA ex-mtm (2) (37) % (18) +22% (50) Geração Comercialização Outros Generation Energy Others (1) trading Generation Energy Others (1) Generation Energy Others (1) trading trading Generation Ventos do Piauí I fully operational brings additional results to net revenues and adjusted EBITDA Energy trading operational results decreased due to lower sales volume and adjusted EBITDA reflects the non-cash effect of mark-to-market (1) Includes eliminations, holding and service results. (2) Adjusted EBITDA excluding the non-cash effect of mark-to-market of energy contracts. 15

16 Sergio Malacrida CFO Votorantim S.A.

17 Consolidated Net Revenues R$ million Evolution by Business Breakdown by Business Long Steel 5, ,785 Votorantim Energia 13% 6% 34% Votorantim Cimentos +20% CBA 17% Votorantim Cimentos Nexa CBA Votoratim Energia Long Steel (1) (2) Others 30% Nexa (1) Includes Argentina and Colombia (2) Holding, eliminations and others 17

18 Consolidated Adjusted EBITDA R$ million Evolution by Business Breakdown by Business % ,140 CBA 21% Long Steel Votorantim Energia 1% 4% 20% Votorantim Cimentos Votorantim Cimentos Nexa CBA Votorantim Energia Long Steel (1) (2) Others 54% Margin % Nexa Higher metal prices in LME Higher sales volume of cement operations (1) Includes Argentina and Colombia (2) Holding, eliminations and others 18

19 US$ million Net Revenues Adjusted EBITDA Nexa Resources Net Debt Net debt/adjusted EBITDA +23% x 0.37x % Margin % Higher metal prices in LME: zinc +23%, copper +19% and lead +11% Solid cash generation 19

20 Long Steel Argentina and Colombia R$ million Volume (kton) Net Revenues Adjusted EBITDA 160-3% % (5) +2% Argentina Colombia Argentina Colombia Margin % Argentina: higher sales volume and prices, driven by the continuous recovery in the economic scenario Colombia: market recovery resulting in higher prices 20

21 Other Investee Companies Adjusted EBITDA (R$ million) Net Debt (R$ million) Net Debt/Adj. EBITDA (US$ million) Adjusted EBITDA (US$ million) Net Debt Net Debt/Adj. EBITDA (US$ million) Net Income (R$ million) Consolidated Delinquency % 1, x 11, x 12, % x 2.08x % % 3.9% Mar/17 Mar/18 Mar/17 Mar/18 % % Margin (1) % % Margin (1) Calculation excludes pulp sales from agreement with Klabin 21

22 Consolidated Net Income R$ million Operating results 532 Result from equity investments 251 Financial results 89 Income tax and others Discontinued operations (159) (17) 150 (546) Operating results positively impacted mainly by improved metals prices Better results from Fibria and Banco Votorantim 22

23 Investments R$ million Capex Breakdown Expansion Capex % % 41% 35% 65% 23% Expansion Non Expansion Votorantim Cimentos Votorantim Energia Nexa 23

24 Cash Generation R$ million Operational Free Free Cash Flow Generation CFO -48% FCF -16% 1,140 (765) (1,133) (1,144) (1,328) (1,689) (239) (345) (1,133) (13) (231) 49 (1,328) Adjusted EBITDA Working capital/ Others Taxes Capex CFO Investments/ Divestments Financial result Others FCF 24

25 Consolidated Gross Debt R$ billion Gross Debt Debt by Currency 24.6 (1.4) (0.3) % 4% 27% 56% FX Dec 31, 2017 Borrowings/ Amortizations Interest payment Interest accrual FX/ Others Mar 31, USD EUR BRL (1) Others (1) 4131 bilateral loan considered as BRL due to the cross-currency swap 25

26 Liquidity Position and Debt Amortization Profile R$ billion Net Debt Debt Amortization Schedule (Pro Forma) (1) Net Debt / Adjusted EBITDA Revolving Credit Facilities Cash BRL (27%) Foreign currencies (73%) 3.89x 3.89x 3.85x 2.60x 2.58x Average debt maturity: 8.1 years (2) (2) 2Q17 3Q17 4Q (3) (1) Pro forma includes early debt payments executed by Votorantim Cimentos in April 2018 (2) Restated value (3) Considers ~R$450 million ongoing debt prepayment allocated on current liabilities. 26

27 Closing Remarks Usual prudence in conducting the businesses Focus on modernization and sustaining investments Leverage reduction Patient capital allocation 27