4Q17 Results Presentation March 2018 Larrainvial 12 Annual Andean Conference Santiago. Asesores Financieros

Transcription

1 4Q17 Results Presentation March 2018 Larrainvial 12 Annual Andean Conference Santiago Asesores Financieros

2 Results 4Q17 Agenda General Background Main Consolidated SK s subsidiaries Highlights Financial Exhibits figures

3 Company Overview Corporate Presentation Sigdo Koppers Sigdo Koppers, Chilean conglomerate founded in One of the most dynamic and important industrial groups in Chile. Our commitment is a long term investment industrial approach, aiming to be a comprehensive supplier of products and services for the mining and industrial operations worldwide. Sales (US$ millions) Ingeniería y Construcción Enaex Magotteaux SK Comercial Consolidated EBITDA (US$ millions) 60,62% 60,72% 97,75% 87,20% Puerto Ventanas SK Godelius SKBergé 50,01% 58,19% 40,00% Net Profit (US$ millions) Source: Company Note: The percents correspond to the ownership of Sigdo Koppers over its subsidiaries, as of March 2017 (1) Net Profit of 2011 have an extraordinary effect of US$157 millions mainly due to the sale of CTI (2) Net Profit of 2013 have an extraordinary loss of US$29.2 millions mainly due to the sale of Sigdopack 3

4 Corporate Governance Board of Directors Corporate Presentation Ownership Structure Sigdo Koppers 1. Juan Eduardo Errázuriz Ossa Chairman 3. Horacio Pavez Aro Director 5. Canio Corbo Lioi Independent Director 7. Norman Hansen Rosés Director 2. Naoshi Matsumoto Takahashi Vicepresident 4. Juan Andrés Fontaine Talavera Director 6. Jaime Vargas Serrano Director Daily Average vol. traded (1) : US$0.6 millions Market Cap: US$2.2 billions (As of Feb 28th 2018) Source: Santiago Stock Exchange. (1) Last 12 month 4

5 Corporate Presentation Supplier of products and services for the mining Investment approach Strategic Focus: Provide products and services for the mining and industry aprox. 75% of the SK s Consolidated EBITDA comes from the exposure to the mining activities Involved in the main stages of the mining value chain MINING DEVELPOMENT MINING OPERATION ORE PROCESSING SALES & LOGISTICS Anglo American - Minera Los Bronces: Codelco Andina: BHP Billiton - Minera Escondida:

6 Results 4Q17 Agenda General Background Main Consolidated SK s subsidiaries Highlights Financial Exhibits figures

7 Highlights - December 2017 Results 4Q17 Consolidated Income Statement Dic-16 Dic-17 Var. Sa l es ,6% EBITDA (1) ,7% EBITDA Margin 13,3% 13,0% EBITDA Pro Forma (2) ,5% Profi t (Los s) ,0% Sigdo Koppers Net Profit (non recurrent) Figures in ThUS$ ,9% Dec-16 Dic-17 Var. Tota l As s ets ,3% Total Equity (3) ,2% Net Debt ,5% Net Debt / EBITDA 2,79 2,62 ROE 255,41% 254,37% ROCE 6,70% 6,26% Consolidated revenues amounted to US$2.20 billion, a similar level compared to Dic-16. Magotteaux sales rose 6%, inline with a higher level of physical sales (+4%). Lower sales at SK Comercial, mainly due to a decrease in Chile and Perú. Consolidated EBITDA amounted to US$286 millions (-2%) Higher level of EBITDA in Puerto Ventanas by greater transfer of cargo. Net profit totaled US$83 millions (-2%), a decrease explained by: Lower performance of the Engineering and Construction business due to the low level of activity and lower yields than expected in some works The negative impact of the increase in raw materials (ferrochrome and scrap) in Magotteaux Lower level of sales in the machinery distribution business in Chile. Sigdo Koppers is executing plans of reorganization and cost efficiency in its different subsidiaries Sigdo Koppers has a good consolidated Cash liquidity of US$311 millions and a conservative level of consolidated debt The net financial debt-to-ebitda ratio is 2.62x and if we add consortiums net profit is 2.54x (1) EBITDA = Ganancia Bruta + Otros Ingresos por Función Costos de Distribución - Gastos de Administración Otros Gastos por Función + Gastos de Depreciación y Amortización (3) EBITDA Pro-forma: considera las utilidades de empresas relacionadas que no consolidan. 7

8 Results 4Q17 Agenda General Background Main Consolidated SK s subsidiaries Highlights Financial Exhibits figures

9 Main Subsidaries 60,43% 60,72% 87,2% 40,0% 97,75% 50,01% 51,82% DESARROLLO OPERACIÓN PROCESO VENTA Y LOGÍSTICA 53 años de experiencia en más de 300 proyectos de gran envergadura Producción de Nitrato de Amonio y Servicios de Tronadura Venta, Arriendo y Servicio de Maquinaria de prestigiosas marcas Comercialización de automóviles Producción de Bolas de Molienda y Piezas de desgaste (casting) Puerto de Carga a granel y combustible. Dueña de 52% Fepasa (tpte. ferroviario) (Presencia en Chile y Perú) (Presencia en Chile, Perú Brasil y Colombia) (Presencia en Chile, Perú Argentina y Colombia) (Presencia en 11 países) Cadena de valor de la minería e industria 9

10 Ingeniería y Construcción SK Ingeniería y Construcción Sigdo Koppers Dic-16 Dic-17 Var. 4Q16 4Q17 Var. MM$ MM$ % MM$ MM$ % Revenue ,7% ,3% EBITDA ,8% ,7% EBITDA Margin -0,1% 3,5% 3,5% 15,8% Pro-Forma EBITDA(*) ,6% ,9% Pro-Forma EBITDA Margin 5,0% 4,7% 7,1% 15,5% Controller's net profit ,6% ,0% Horas Horas Horas Horas Var. Var. (Miles) (Miles) (Miles) (Miles) Total man-hours executed ,2% ,3% (*) Pro-Forma EBITDA: EBITDA + Related company profit Lower level of investments in Chile and Peru evidenced in recent years has affected the performance of the company Sale of fixed assets with profit of $ 5,051 million ICSK Brasil Construction of electric transmission lines in Brazil for State Grid through a consortium with Alumini and Fujian has already started. Backlog Projects awarded for US$519 million (Jan-Dec-2017): Main transportation system in Chuquicamata subterráneo (Codelco), transfer project in Codelco Andina (Codelco), modification of tailings thickeners (Minera Escondida), Talara refinery modernization project ( PetroPerú), refurbishment of ball mills (Collahuasi) and the disassembly and assembly of transformers (Minera Escondida) Main projects in progress: Repowering of ball mills / Collahuasi (70% advance), Projects Vulnerability of Gases in Cellulose Plants / Arauco (95% advance) and tunnels dress Chuquicamata subterráneo / Codelco (95% advance) 10

11 Puerto Ventanas Puerto Ventanas Consolidated Dic-16 Dic-17 Var. 4Q16 4Q17 Var. ThUS$ ThUS$ % ThUS$ ThUS$ % Revenue ,3% ,8% EBITDA ,1% ,0% EBITDA Margin 25,8% 29,5% 26,8% 28,8% Controller's net profit ,1% ,0% PVSA - Tons transferred ,8% ,1% Fepasa - Th Ton-Km ,7% ,9% Puerto Ventanas Fepasa Cargo Transfer (+4%) Higher Cooper Concentrate transfers (+3%) and grain (+99%). Port business income reach US$65 million (+12%) Investments New warehouse for Cu Concentrate up and running. Upgrade Site No.3: Ramp up period Mobilized load Cargo movement of Cu Concentrate (+33%) due to new contract with Codelco Teniente. Movement of wood pulp cargo (-26%), impacted by the collapse of the Toltén bridge on August 18, 2016 (lower volumes and over costs). This situation will continue until the repair of the bridge by EFE. Higher EBITDA (+81%) due to a significant decrease in direct operational costs Start in cargo transfer from Anglo American by rail, transport of the copper concentrate from the Las Tórtolas plant (Los Andes) to Puerto Ventanas. 11

12 12 Enaex Enaex Dic-16 Dic-17 Var. 4Q16 4Q17 Var. ThUS$ ThUS$ % ThUS$ ThUS$ % Revenue ,9% ,4% EBITDA ,5% ,0% EBITDA Margin 23,9% 23,3% 25,5% 23,1% Controller's net profit ,0% ,4% Chemical business (Amonium Nitrate) Lower AN sales associated with lower consumption in Chile, together with lower consumption of certain deposits in the region and decreases in the Peruvian market. AN exports dropped by 2%. Rock Blasting Services Chile: more complex scenario with lower volumes in some clients (-13% v/s 4Q16). Brazil / Britanite: Slight economic recovery in Brazil and new awarded contracts, particularly in mining, has increased sales volume (+23%) and EBITDA (+141%). Physical sales evolution (Thu Tons) Davey Bickford: Higher revenues (+12%) explained mainly by a recovery in the American and Australian market. Growth in EBITDA (+ 103%) in line with higher revenues and greater operational efficiency

13 Magotteaux Magotteaux Group Dic-16 Dic-17 Var. 4Q16 4Q17 Var. MUS$ MUS$ % MUS$ MUS$ % Revenue ,2% ,2% EBITDA ,6% ,2% EBITDA Margin 10,1% 6,5% 7,6% 3,9% Controller's net profit ,6% ,9% Volume Grinding Balls Business: Higher volumes of HiCr, particularly in the mining market in North America (+5%). Casting business: higher volumes, particularly in aggregates (+6%) and mining (+32%). Magotteaux Group Dic-16 Dic-17 Var. % Mill Balls ,1% Cas ting ,1% Total ,1% Quick increase in the price of FeCr and scrap at an international level that has not yet been completely transferred to customers, affecting the margins both grinding balls and casting. US$16 million loss in net result due to this effect Reorganization Plan SG&A expenses decreased 6% compared to Dic-16 (-8% vs. Dic-15) New provisions affected the EBITDA of 4Q17. Recurring EBITDA reached US$ 51 million 13

14 SK Comercial SK Comercial Dic-16 Dic-17 Var. 4Q16 4Q17 Var. ThUS$ ThUS$ % ThUS$ ThUS$ % Revenue ,2% ,9% Distribution Business ,6% ,9% Rental Business ,7% ,5% Consolidation adjust ,0% ,0% EBITDA ,8% ,4% EBITDA Margin 9,0% 9,4% 7,3% 10,4% Control l er's net profi t ,6% ,0% Machinery Distribution Business Machinery sales in Chile remain depressed (-12% units vs. Dic-16). Mainly the industrial machinery market (-28% units vs. Dic-16). Machinery Rental Business Fleet: US$152 million (-16% vs. Dec-16) Rental markets in Chile and Peru remain stable. SKRental continues in a fleet reduction strategy in Chile and Peru to fit the size of the market and lower investment cycle. Corporate reorganization Continuing a project to reduce costs and synergies between different subsidiaries of SKC, Dic-17 reports US$2 million higher costs for this concept. Synergy projects in warehouses and workshops. Rationalisation of branches and maximizing the use of offices and operations in Lampa (headquarters). 14

15 SK Inversiones Automotrices SK Inversiones Automotrices Dic-16 Dic-17 Var. 4Q16 4Q17 Var. MM$ MM$ % MM$ MM$ % Controller's net profit ,6% ,1% SKIA had profits of MM$17,393 Chilean Pesos (US$27 millions) (+16%). Chile Perú Result explained by higher margins of SKBergé in Chilean market (Positive effect of exchange rate) Higher sales volume in Chile, Peru and Colombia SKBergé accounted sales for 78,197 units, an increase of 15% compared to September Higher level of sales in Chile: 42,919 units (+30%). Higher sales performance abroad: 35,278 units (+ 1%). Colombia In Chile, ANAC recorded sales of 360,900 units in 4Q17 (+ 18%). High growth potential in countries such as Peru and Colombia Argentina 15

16 Results 4Q17 Agenda General Background Main Consolidated SK s subsidiaries Highlights Financial Exhibits figures

17 Sigdo Koppers Income Statement Sigdo Koppers Consolidated Income Statement Figures in ThUS$ Cifras en MUS$ Dic-16 Dic-17 Var. 4Q16 4Q17 Var. Sales ,6% ,1% Sales expenses ,9% ,8% Gross income ,6% ,8% Other operating income ,5% ,2% Distribution costs ,1% ,8% Administrative expenses ,5% ,6% Other operating expenses ,3% ,4% Operating income ,0% ,3% EBITDA ,7% ,9% % EBITDA Margin 13,3% 13,0% 14,5% 15,2% Interest income ,0% ,8% Interest expenses ,2% ,1% Related companies income ,1% ,9% Exchange differentials ,9% ,7% Price - level restatement ,7% ,7% Other income (losses) ,8% ,4% Gain (losses) between book value and fair value (financial assets) Income before taxes ,8% ,2% Income tax ,5% ,8% Income ,0% ,5% Gain (losses) from uncontinnued operations Net income ,0% ,5% Income attributable to Sigdo Koppers ,9% ,0% Income attributable to non-controlling interests ,2% ,6% 17

18 Revenue Sigdo Koppers Revenue Business Areas Figures in ThUS$ Figures in ThUS$ Dic-16 Dic-17 Var. 4Q16 4Q17 Var. Services ,5% ,1% Ingeniería y Construcción SK ,6% ,4% Puerto Ventanas ,3% ,8% Industrial ,9% ,8% Enaex ,9% ,4% Magotteaux (1) ,2% ,2% SK Inv. Petroquímicas ,0% ,1% Commercial & Automotive ,2% ,9% SK Comercial ,2% ,9% SKIA (2) Parent company & adjustment (3) ,6% ,9% Consolidated Sales ,6% ,1% Area Servicios Area Industrial Area Comercial y Automotriz (1) Magotteaux s figures include income of SKSabo Chile S.A. The profits attributable to the controller were adjusted in the different companies through which Sigdo Koppers controls Magotteaux. (2) SK Inversiones Automotrices S.A. (SKIA) does not account for the income of SKBergé because it holds 40% of its shares and, therefore, does not consolidate its financial statements. (3) Eliminations and adjustments as of June are mainly the result of consolidated intercompany eliminations 18

19 D Revenue by country (incl. SKBergé) December 2016 Ventas Áreas de Negocios Chile Perú Colombia Brasil Asia Norte America Europa Otros Países MUS$ MUS$ MUS$ MUS$ MUS$ MUS$ MUS$ MUS$ Área Servicios 86,7% 13,3% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% Ingeniería y Construcción SK 82,9% 17,1% Puerto Ventanas 100% Área Industrial 41,3% 1,2% 0,3% 10,8% 9,5% 12,5% 20,9% 3,4% Enaex 67,6% 2,2% 0,7% 12,7% ,2% 2,6% Magotteaux 11,9% - - 8,9% 20,0% 26,4% 28,4% 4,4% SK Inv. Petroquímicas 100% Área Comercial y Automotriz 57,4% 31,8% 6,4% 0,3% 0,0% 0,0% 0,0% 4,1% SK Comercial 83,3% 13,3% 1,8% 1,6% SKIA 51,6% 36,0% 7,4% ,0% Ventas Empresas SK 56,2% 17,3% 3,1% 4,2% 3,5% 4,7% 7,8% 3,2% December 2017 Ventas Áreas de Negocios Chile Perú Colombia Brasil Asia Norte America Europa Otros Países MUS$ MUS$ MUS$ MUS$ MUS$ MUS$ MUS$ MUS$ Área Servicios 87,5% 12,5% 0,0% 6,7% 0,0% 0,0% 0,0% 0,0% Ingeniería y Construcción SK 83,7% 16,3% - 8,8% Puerto Ventanas 100% Área Industrial 36,9% 4,6% 0,1% 12,9% 8,6% 14,7% 18,0% 4,2% Enaex 60,1% 8,9% 0,3% 16,6% ,1% 4,0% Magotteaux 12,2% - - 8,9% 17,7% 30,3% 26,5% 4,4% SK Inv. Petroquímicas 100% Área Comercial y Automotriz 60,4% 27,8% 5,8% 0,5% 0,0% 0,0% 0,0% 5,5% SK Comercial 92,1% 2,4% 2,0% 3,6% SKIA 55,3% 31,9% 6,4% ,4% Ventas Empresas SK 56,1% 17,0% 2,9% 5,9% 3,1% 5,3% 6,5% 4,2% 19

20 EBITDA Sigdo Koppers EBITDA Business Areas Figures in ThUS$ Figures in ThUS$ Dic-16 Dic-17 Var. 4Q16 4Q17 Var. Services ,1% ,5% Ingeniería y Construcción SK ,3% ,9% Puerto Ventanas ,1% ,0% Industrial ,7% ,4% Enaex ,7% ,0% Magotteaux (1) ,6% ,2% SK Inv. Petroquímicas ,0% ,6% Commercial & Automotive ,9% ,2% Area Servicios Area Industrial Area Comercial y Automotriz SK Comercial ,8% ,4% SKIA (3) ,2% ,3% Parent company & adjustment ,0% ,3% Consolidated EBITDA ,7% ,9% EBITDA Margin 13,3% 13,0% 14,5% 15,2% Consolidated pro-forma EBITDA ,5% ,1% (1) Magotteaux s figures through December include the EBITDA of SK Sabo Chile S.A. (2) SK Inversiones Automotrices S.A. (SKIA) does not account for the EBITDA of SKBergé because it owns 40% of its shares and, therefore, it does not consolidate its financial statements. (3) Pro Forma EBITDA = EBITDA + Related Company Profits. 20

21 21 EBITDA Pro-Forma By business área: Dic-16 v/s Dic-17 ( K US$ ) Results 4Q17-5.5% Pro-Forma EBITDA decreased a 11% in CLP due to lower level of activity in the mining sector (BSK) and Works with problems of recovery of "claims" Lower physical sales and lower operating margin because of plant maintenance Lower performance of rental business (-5%) Higher margins and volumes Higher operational profit on PVSA (+3 MUS$) and in Fepasa (+3 MMUS$) Rapid increase of raw material affected the margins in business of grinding balls and casting.

22 Sigdo Koppers Net Profit Net profit Business Areas Total Companies Attributable to parent company % SK Figures in ThUS$ Figures in ThUS$ Dic-16 Dic-17 Var. Dic-17 Dic-16 Dic-17 Var. Services ,1% ,1% Ingeniería y Construcción SK ,0% 60,43% ,6% Puerto Ventanas ,1% 50,01% ,8% Industrial ,6% ,5% Enaex ,0% 60,72% ,0% Magotteaux (1) ,6% 95,00% ,0% SK Inv. Petroquímicas (2) ,5% 74,59% ,5% Commercial & Automotive ,6% ,2% SK Comercial ,6% 87,20% ,8% SKIA ,5% 99,99% ,6% SK companies profit ,2% ,3% Parent company & adjusments Total consolidated profit ,9% Services Industrial Commercial & Automobile (1) Magotteaux s figures include income of SK Sabo Chile S.A. The profits attributable to the controller were adjusted in the different companies through which Sigdo Koppers controls Magotteaux. (2) The profit of CHBB was adjusted in SK Inversiones Petroquímicas S.A. through which Sigdo Koppers controls CHBB. 22

23 Sigdo Koppers Balance sheet Consolidated Balance Sheet Figures in ThUS$ Dec-16 Dic-17 Var. Current Assets Cash and cash equivalent ,7% Account and sales receivables ,7% Inventories ,6% Other current assets ,5% Total current assets ,7% Long-term assets Property, plants & equipment ,2% Other long-term assets ,6% Total long-term assets ,2% Total assets ,3% Current liabilities Short-term financial debt ,4% Accounts payable ,7% Other current liabilities ,3% Total current liabilities ,1% Long-term liabilities Long-term financial debt ,3% Other long-term liabilities ,8% Total long-term liabilities ,7% Total liabilities ,2% Equity Attributable to the controller ,9% Attributable to non-controlling interests ,0% Total equity ,2% Total liabilities and equity ,3% Indicators Dec-16 Dic-17 Net Financial Debt Working Capital Working Capital Days Days of Consolidated Inventory Accounts Receivable (Days) Accounts Payable Days

24 Conservative financial profile Financial Debt Net Financial Debt/ EBITDA Parent Comp. Services Industrial Commercial & Automobile Current 23% Non Current 77% 2,62x 2,54x US$ 1,061 millions Consolidated US$ 751 millions Net Financial Debt Cash (US$ millions) Key financial Indicators Consolidated Leverage: 1.05x Financial Net Leverage**: 0.41x Net Financial Debt/EBITDA: 2.62x ND/(EBITDA+Consortium): 2.54x Rating: A+ Fitch-Ratings AA- ICR * Including CHBB, SK Inv. Automotrices S.A. y SK Internacional S.A. ** Corporate Bonds Covenant < 1,2x 24

25 Cash Flow of Sigdo Koppers Consolidated Cash Flow Figures in ThUS$ Dic-16 Dic-17 Var. Operating cash flow ,4% Investment cash flow ,3% Capex ,4% Fixed assets sales ,5% Other ,9% Finance cash flow ,1% Net variation in financial liabilities % Interest ,9% Dividends ,1% Capital increased ,0% Other ,6% Total net cash flow ,1% Effect of exchange rate changes ,8% Cash and cash equivalent ,4% 25

26 CAPEX Results 4Q17 Capex Áreas de Negocios Dic-16 MUS$ Dic-17 MUS$ Área Servicios Ingeniería y Construcción SK Puerto Ventanas Área Industrial Enaex Magotteaux SK Inv. Petroquímicas - - Área Comercial y Automotriz SK Comercial (1) SKIA - - Capex Empresas SK Major investments in Fixed Assets: Puerto Ventanas: Enaex: Ramp up of copper concentrate warehouse of 46,000 Tons capacity Upgrade of Site #3 (total investment US$32 million, beginning of operations during Dec-17) Overhaul and Upgrade in Prillex plant (Panna 3) (US$ 2.5 million) Construction plant in Los Bronces (US$ 2.6 million) Construction of a modular emulsion plant in the USA (US$ 1.6 million) SK Comercial: Defleeting (divestment) of fleet of SK Rental. (1) Capex Neto: El Capex de SKC incluye la venta de maquinaria usada de SK Rental 26

27 Results Presentation Asesores Financieros