Erdemir Group 2009 Consolidated Financial Results

Transcription

1 Erdemir Group 2009 Consolidated Financial Results 22 February /28

2 DISCLAIMER Ereğli Demir Çelik Fabrikaları T.A.Ş. (Erdemir) may, when necessary, make written or verbal announcements about forward-looking information, expectations, estimates, targets, assessments and opinions. Erdemir has made the necessary arrangements about the amounts and results of such information through its Disclosure Policy and has shared such policy with the public through the Erdemir website, in accordance with the Capital Markets Board regulations. As stated in related policy, information contained in forward-looking statements, whether verbal or written, should not include unrealistic assumptions or forecasts. It should be noted that, actual results could materially differ from estimates taking into account the fact that they are not based on historical facts but are driven from expectations, beliefs, plans, targets and other factors which are beyond the control of our Company. As a result, forward-looking statements should not be fully trusted or taken as granted. Forward-looking statements should be considered valid only considering the conditions prevailing at the time of the announcement. In cases where it is understood that forward-looking statements are no longer achievable, such matter will be announced to the public and the statements will be revised. However, the decision to make a revision is a result of a subjective evaluation. Therefore, it should be noted that, when a party is coming to a judgement based on estimates and forward-looking statements, our Company may not have made a revision at that particular time. Our Company makes no commitment to make regular revisions which would fully cover changes in every parameter. New factors may arise in the future which may not be possible to foresee at this moment in time. 2 /28

3 Agenda 2009 Market Overview 2009 Results Management Policies and Measures Against Downturn and Results 3 /28

4 In EU27 countries, crude steel production increased by 35% in December 2009 YoY. EU27 CRUDE STEEL PRODUCTION ( YoY % )* EU HRC PRICE ( USD/TON )** 40% % 20% 10% 0% -10% -20% -30% -40% -50% -60% Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-02 May-03 Oct-03 Mar-04 Aug-04 Jan-05 Jun-05 Nov-05 Apr-06 Sep-06 Feb-07 Jul-07 Dec-07 May-08 Oct-08 Mar-09 Aug-09 Jan SOURCE: * WSA ** BLOOMBERG 4 /28

5 In USA, crude steel monthly production is higher than the previous year since November USA CRUDE STEEL PRODUCTION ( YoY % )* NORTH AMERICA HRC PRICE ( FOB USD/TON )** 50% 30% 10% -10% % -50% -70% Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec Dec-02 May-03 Oct-03 Mar-04 Aug-04 Jan-05 Jun-05 Nov-05 Apr-06 Sep-06 Feb-07 Jul-07 Dec-07 May-08 Oct-08 Mar-09 Aug-09 Jan-10 SOURCE: * WSA ** BLOOMBERG 5 /28

6 In CIS, there is an upward trend in falling prices since May % CIS CRUDE STEEL PRODUCTION ( YoY % ) * CIS BLACK SEA/BALTIC EXPORT HRC PRICE ( FOB USD/TON )** 50% 40% % 20% 10% 0% % -20% -30% -40% -50% Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-02 May-03 Oct-03 Mar-04 Aug-04 Jan-05 Jun-05 Nov-05 Apr-06 Sep-06 Feb-07 Jul-07 Dec-07 May-08 Oct-08 Mar-09 Aug-09 Jan SOURCE: * WSA ** BLOOMBERG 6 /28

7 HRC prices are ramping up. USD/TON CHINA 2ND QUALITY COKING COAL SPOT EXPORT PRICE CHINA PORT FINE ORE PRICE CFR USD/TON EREĞLİ HRC EFFECTIVE PRICE CIS SLAB BLACKSEA/BALTIC EXPORTPRICE FOB USD/TON USD/TON BRAZIL TUBARAO ROTTERDAM FREIGHT AUSTRALIA CAPE LAMBERT ROTTERDAM FREIGHT RAW MATERIAL PRICES ( AUGUST 2008 JANUARY 2010 ) PELLET - 37 % 135 USD/TONS IRON ORE - 13 % 126 USD/TONS COKE - 52 % 340 USD/TONS SOURCE: BLOOMBERG 7 /28

8 Idle capacities are being utilized again. (January 2008:100) WORLD CRUDE STEEL PRODUCTION WORLD HOT METAL PRODUCTION 70 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 World wide hot metal production is increasing rapidly in last months reaching to 80 million tons in December 2009 from 62 million tons in December Similarly, world wide crude steel production is up to 106 million tons in December 2009 from 81 million tons in December SOURCE: WSA 8 /28

9 Turkish steel market was rapidly developing until global downturn. PRODUCTION ( 000 TONS ) Long Flat Alloy Steel Total CONSUMPTION ( 000 TONS ) SOURCE: TISPA Long Flat Alloy Steel 9 /28 Total

10 Turkish Steel Market ( cont d ) IRON AND STEEL PRODUCT EXPORTS ( 000 TONS ) Long Steel Billet, Bloom Flat Steel Slab Total IRON AND STEEL PRODUCT IMPORTS ( 000 TONS ) Long Steel Billet, Bloom Flat Steel Slab Total SOURCE: TISPA 10 /28

11 Automotive production and sales have decreased by 24% and 16% respectively in 2009 YoY. AUTOMOTIVE PRODUCTION (000 UNITS) AUTOMOTIVE SALES (000 UNITS) Domestic Sales Export AUTOMOTIVE CAPACITY UTILIZATION RATIO (%) Light Vehicles SOURCE: AUTOMOTIVE MANUFACTURERS ASSOCIATION 11 /28

12 After the contraction in 2009, growth is expected in all markets in SECTOR DEVELOPMENT INDEX (2000:100) (e) 2011 (e) 146,3 127,3 133,7 141,7 271,1 269,2 285,0 305,0 142,6 127,5 133,8 147,2 184,2 153,8 164,8 182,8 156,8 126,8 136,8 153,9 216,3 164,4 171,2 195,8 Construction Domestic Appliances Electrical Equipment Machinery Production Metal Goods Automotive In 2009; all sectors have contracted as compared to In 2010 and 2011, all industries are expected to recover by 5-15%. SOURCE: TSI and ERDEMİR GROUP ANALYSES 12 /28

13 Sales prices were steady in HRC PRICES ( USD/Ton ) Çin 2.Kalite Kok Kömürü Spot İhraç Fiyatı ( USD/TON ) Presently, CIS HRC export price is 575 USD, China HRC spot price is 558 USD, US export HRC price is 545 USD. The prices were 390 USD, 577 USD, 515 USD respectively by the end of Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 CIS EXPORT HRC BLACKSEA/BALTIC CHINA SPOT HRC WORLD HRC PRICE TRACKER BILLET PRICES ( USD/Ton ) EU HRC USA IMPORT HR ERDEMİR GRUBU CIS export price is reaching to 465 USD from 365 USD in December Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 SOURCE: BLOOMBERG BILLET CHINA EXPORT BILLET EXPORT TURKEY BILLET CIS EXPORT BLACKSEA/BALTIC ERDEMIR GROUP 13 /28

14 Agenda 2009 Market Overview 2009 Results Management Policies and Measures Against Downturn and Results 14 /28

15 ERDEMİR GROUP KEY FIGURES Liquid Steel Production (000 Tons) Slab Production (1) (000 Tons) Flat Steel Production (2) (000 Tons) Long Steel Production (000 Tons) Flat Steel Shipments (000 Tons) Long Steel Shipments (000 Tons) Net Sales Revenue (M. USD) EBITDA (M. USD) Net Profit For the Year (M. USD) All figures are on IFRS consolidated basis unless stated otherwise. (1) Total slab production of Ereğli and İskenderun Plants. (2) Total flat steel production of Ereğli and İskenderun Plants. 15 /28

16 Liquid steel production increased by 8% in 2009 YoY. LIQUID STEEL PRODUCTION ( 000 TONS ) % Q H M /28

17 In 2009, finished goods production increased by 8% compared to PRODUCTION VOLUMES ( 000 TONS ) % Long Long Long Long CRC CRC Cold Cold HRC Hot HRC Hot Q H M Hot Cold Long Total 17 /28

18 Sales volume increased by 19% in 2009 YoY. SALES VOLUME ( 000 TONS ) % Long Long Cold Cold Hot Hot Q H M HRC CRC Long Total 18 /28

19 31% of sales revenue of 2009 was recorded in 4Q09. NET SALES REVENUE ( MILLION TL ) 23 % Q H M Domestic Export Total 19 /28

20 Sales to pipe and profile industry increased while sales to automotive, components and household appliances decreased in FLAT STEEL DOMESTIC SALES BREAKDOWN ( %) FLAT STEEL EXPORTS BREAKDOWN ( %) 2% 5% 4% 5% 15% 12% 13% 44% 10% 2% 2% 3% 5% 74% 26% 8% 12% 58% Pipe and Profile Industry Steel Services Centers EU India Traders Automotive and Components Brazil Egypt Packaging Industry Heating Equipment Vietnam China Household Appliances Other USA Other LONG STEEL DOMESTIC SALES BREAKDOWN ( %) LONG STEEL EXPORTS BREAKDOWN ( %) 14% 15% 8% 3% 13% 67% 40% 4% 4% 4% 5% 10% 33% 46% 22% 12% Debar Producers Commercial Qualities Special Qualities Profile Producers High Carbon Qualities Other Egypt Israel Saudi Arabia EU Iran Syria Indonesia Other 20 /28

21 In 2009, Erdemir Group average flat and long steel prices were 518 USD/ton and 439 USD/ton respectively. USD/TON Flat Sales Price Flat Cost of Sales Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 USD/TON Billet Sales Price Billet Cost of Sales Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Flat steel prices increased by 31% on average during 12 months of Increase in average flat product price was 18% in last quarter of /28

22 78% of total EBITDA is generated in 4Q09. EBITDA ( MILLION TL ) Q H M NET PROFIT/LOSS ( MILLION TL ) Q H H /28

23 In 2009, borrowings started to decline for the first time in the last 5 years. BORROWINGS ( MILLION USD ) ST portion of LT Debt Short-Term Debt BORROWINGS MATURITY PROFILE ( MILLION USD ) Long-Term Debt 600 Liquid Funds After 23 /28

24 Agenda 2009 Market Overview 2009 Results Management Policies and Measures Against Downturn and Results 24 /28

25 Lowest level of fixed costs was attained in the year ( MILLION USD ) Total = Total = Total = Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Fixed Cost Variable Cost 25 /28

26 Fixed and variable costs decreased in 2009 YoY. FLAT PRODUCTS ( USD/TON ) Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q LONG PRODUCTS ( USD/TON ) 150 Fixed Cost per Ton Variable Cost per Ton Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Fixed Cost per Ton Variable Cost per Ton 26 /28

27 No major capex in 2009 due to the completion of a greater portion of investments in ( M USD ) After İskenderun Investments Erdemir Mining Investments Ereğli Investments As of 2009 year-end, capital expenditures worth 3.0 billion USD have been completed and 0.3 billion USD yet to be completed. 27 /28

28 Number of employees decreased about 10% YoY and 13% since 2007 due to voluntary redundancies and retirements. NUMBER OF EMPLOYEES /28

29 Q&A