EMEA presentation by Ulrich Albrecht-Früh

Transcrição

Business Area
EMEA–Introduction
and Challenges
Dr. Ulrich Albrecht-Früh
President – Stainless Coil EMEA
Business Area
Outokumpu
Experience
2013
May 22-23, 2013
Old Billingsgate,
London, UK
Outline
1. Business Area EMEA at a glance
2. EMEA market environment
3. EMEA Strategy – opportunities and challenges
BA EMEA introduction and challenges, Dr. Ulrich Albrecht-Früh
5/22/2013
2
BA EMEA at a glance
•
As of May 2013
Tornio
Kemi
•
•
Terneuzen
Bochum
Krefeld
Dahlerbrück
Benrath
Dillenburg
•
Business area EMEA produces high-volume
and tailored stainless steel grades
Extensive sales network with 13 service
centers, 11 sales offices, 5 sales agents
across the EMEA region
Highly cost competitive Tornio stainless steel
mill with integrated ferrochrome production
and own chromite mine in Kemi
Highly end customer orientated austenitic
and ferritic production in Germany, Europe’s
largest market
Outokumpu has a market share of
roughly 40% in Europe
5/22/2013
3
BA EMEA financial highlights
•
•
•
•
Stainless Coil EMEA is the largest of
Outokumpu’s business areas, and
accounts for more than half of group
sales
Q1 2013 stainless steel deliveries
increased by 10% to 447,000 tonnes
compared to Q4 2012
EBIT clearly improved versus Q4 2012
due to higher capacity utilization by
increased volumes and lower costs as a
result of the synergy savings and the
concluded P100 program
The positive Q1 2013 performance was
also due to the smooth ramp-up of the
ferrochrome production
Q1/13
Q4/ 2012
Q1/12
2012
comparable
comparable
comparable
447
408
474
1,752
Sales 2)
1,397
1,331
1,630
5,982
EBITDA
20
-19
55
-35
EBIT
-28
-65
-35
-276
-
-7
-42
-126
7,795
7,977
8,394
7,977
26
n.a.
n.a.
323
EUR million
Stainless steel
deliveries 1)
Non-recurring
items in EBIT
Employees
Capex
1) 1,000 tonnes, incl. internal deliveries, excl. ferrochrome deliveries, 2) Incl. internal sales
5/22/2013
4
BA EMEA product portfolio and capacities
Melting
1,000 tonnes
Product
Slab
Production
facility
Hot rolling
Cold rolling
Hot rolled black & Cold rolled
white strip
strip 2B/BA 1)
Precision
strip
Role of the production facility
Tornio
1,600
1,600
750
Key melt shop for Europe, austenitic and ferritic,
Cost efficient, high volume austenitic 2B
Krefeld, Benrath, Bochum
800 2)
800 2)
675
Tailored, flexible ferritic/austenitic 2B and BA
Dillenburg, Dahlerbrück
190
20
Total end of 2013
2,400
2,400
1,615
20
Total end of 2016
1,600
1,600
1,615
20
Tailored austenitic BA and precision strip
 Specialized production sites with clear focus to facilitate customer loyalty
•
•
•
Krefeld: Melt shop with a capacity of 600 thousand tonnes is currently ramped-down with full closure by end of 2013.
Bochum: Closure of melt shop planned for 2016. Outokumpu management will conduct a final review and decision on
Bochum melt shop closure in 2015.
Benrath: Currently relocated.
1) 2B= cold-rolled and skin passed; BA = Bright Annealing to create a mirror-like surface, 2) Bochum capacity until end of 2016 planned closure. Krefeld remaining melting capacity not included
5/22/2013
5
Tornio works: Highly competitive cost
position
•
•
•
•
Tornio is the most integrated stainless
steel plant in the world
Highly efficient through large economies of
scale
Own chrome ore – safe supply and stable
ferrochrome quality
State-of-the-art technology (RAP line
producing new 2E semi CR products)
Lowest CR304 unit production costs among largest European plants 1,2)
2,600
Peer average = 2,320 EUR/t 3)
2,400
2,200
Focus on:
2,000
• Austenitic and ferritic hot and cold rolled stainless steel
1,800
• High quality volume products using best available technology
1,600
• Custom-made mass production in selected product areas
2,243
1,400
Outokumpu
Tornio
Plant A
Plant B
Plant C
Plant D
1) Source: SMR as of January 2012, 2) Based on Ni: 20.000$/t; January 2012 average exchange rate 0.7792702 $/€, 3) Excluding Outokumpu Tornio
5/22/2013
6
Most integrated stainless steel mill
FeCr Production
Stainless Production
Kemi Mine
•
•
Ferrochrome Works Ferrochrome
Raw Materials
Steel Melting Shop
Slabs
Hot Rolling Mill
Black Hot Coils
Cold Rolling Mill
White Hot Products
•
•
Cold Rolled Products
Finishing Plant
Tube Mills
End-users and Distributors
Other Steel Mills
•
Ferrochrome production onsite
with molten Ferrochrome
charged directly
No need to crush or reheat,
saving energy and minimizing
transportation costs
Ability to use carbon monoxide
from own processing to
replace propane as energy
source saves costs and CO2
emissions
Short processing time and
lower logistic costs
Cost savings from full
downstream integration into
finished products
5/22/2013
7
Ferrochrome – competitive advantage
Outokumpu ferrochrome production
•
•
•
•
Unique low cost position as Europe’s only
ferrochrome producer with access to the
only known chromite reserves in the EU
Mineral resources to last for roughly
40 years
Q4 2012: finalization of EUR 410 million
investment program to double ferrochrome
production capacity to 530,000 tonnes
Q1 2013: progress slightly ahead of
schedule and ferrochrome production of
97,000 tonnes was reached
Company expects to reach a ferrochrome production
level of approximately 400,000 in 2013 and the full
capacity of 530,000 tonnes in 2015
(1,000 tonnes)
600
500
400
300
200
100
0
2011
2012 2013e 2014e 2015e
Ore reserves: 33 million tonnes and additional
mineral resources of 105 million tonnes
5/22/2013
8
Ferrochrome – competitive advantage
Ranking of major ferrochrome smelters for 2013 in order
of increasing total direct operating cost 1)
Ferrochrome market price development 2)
US¢/lb contained Cr
USD/lb
1.3
100
1.3
1.2
80
Q2’2013
1.27 USD/lb
1.2
60
1.1
1.1
40
1.0
20
Apr 23
1.06 USD/lb
1.0
0
0.9
Apr
Mar
Feb
European contract price
2013
Dec
Nov
Oct
Sep
Outokumpu
European spot price
One of the lowest cost structures among all ferrochrome producers, well below current market prices.
1) Source: CRU December 2012, 2) FerroChrome Contract: MetalBulletin - Ferro-chrome Lumpy CR charge basis 52% Cr quarterly major European
destinations $ per lb Cr, FerroChrome Spot: MetalBulletin - Ferro-chrome 6-8% C basis 60% Cr max. 1.5% Si major European destinations $ per lb Cr
5/22/2013
9
Outline
5/22/2013
10
Continued growth for stainless steel
globally– EMEA will decline in 2013
+7%
+19%
+8%
-3%
+4%
-1%
+3%
AMERICAS
+6%
+4%
EMEA
APAC
+9%
+2%
+4%
Orange = Change 2010-2011
Green = Change 2011-2012
TOTAL WORLD
Blue = Forecast 2013
Data source: SMR, Apr 2013, Real demand for total stainless (rolled & forged, excl. 13Cr Tubes)
5/22/2013
11
EMEA‘s demand is characterized by
stagnant demand and overcapacities
7,000
6,000
EMEA cold rolled stainless steel demand [tonnes]
5,756
5,860
5,883
5,995
5,918
EMEA cold rolled stainless steel capacity [tonnes]
6,045
5,755
5,830
5,855
4,476
4,129
4,040
6,190
6,057
6,190
3.8%
Stagnant demand
2010-2013
5,000
4,000
5,895
3,975
4,075
4,023
3,990
4,093
2010
2011
2012
2013
2014
4,289
4,475
4,580
3,653
3,066
3,000
2,000
1,000
0
2005
2006
2007
2008
2009
2015
2016
2017
• EMEA region reported stagnant demand for stainless steel products between 2010-2013.
• The market is driven by overcapacities and new market entries i.e. Posco in Turkey.
Data Source: Demand = SMR Mar 2013, Capacities = CRU Mar 2013
5/22/2013
12
Since 2007 cheap imports from Asia are
impacting the European market
Cold rolled imports from 3rd countries into EU27
tonnes
March 2013:
20% import share
100,000
from Asia
from Rest of World
80,000
60,000
40,000
20,000
2013
Oct
Jul
Apr
2012
Oct
Jul
Apr
2011
Jul
Oct
Apr
2010
Oct
Jul
Apr
2009
Oct
Jul
Apr
2008
Oct
Jul
Apr
2007
Jul
Oct
Apr
2006
Oct
Jul
Apr
2005
Oct
Jul
Apr
2004
0
• ~70% of third country imports came from Asia in 2012, compared to ~60% in 2006.
• Large imports in 2012 came from Taiwan, USA, China, India, South Korea and South Africa.
Data Source: Foreign Trade Statistics WV Stahl, May 2013
5/22/2013
13
Decrease in transaction prices
Average transaction prices for 2mm cold rolled 304 stainless steel sheet
USD/t
USD/t
Europe
China
Europe-China
5,000
2011
3,998
3,264
734
2012
3,304
2,641
663
Q1 13
3,283
2,587
696
4,000
3,000
2,000
1,000
Jan
11
Jan
12
Transaction price Europe
Transaction price China
Jan
13
Base price Europe
Source: CRU (up to and including April 2013)
5/22/2013
14
Raw materials – last 6 months
Nickel1
19,000
U
S 18,000
D
/ 17,000
t
o
16,000
n
Apr 23
15 085 USD/t
U
S
D
/
l
b
15,000
European contract price
1.2
Q2’2013
1.27 USD/lb
European spot price
1.1
1.0
Apr 23
1.06 USD/lb
0.9
Apr
Mar
10.5
Feb
11.0
2013
11.5
Carbon steel scrap4
400
U
S
D
/
t
o
n
Dec
12.0
Nov
Apr 23
11.3 USD/lb
Oct
Sep
Apr
Mar
Feb
2013
Dec
Nov
Oct
Sep
Molybdenum3
12.5
U
S
D
/
l
b
Ferrochrome2
1.3
Apr 23
363 USD/t
390
380
370
360
350
340
330
320
Apr
Mar
Feb
2013
Dec
Nov
Oct
Sep
Apr
Mar
Feb
2013
Dec
Nov
Oct
Sep
Data source: METAL BULLETIN – 1 Nickel Cash LME Daily Official ; 2 MetalBulletin - Ferro-chrome Lumpy CR charge basis 52% & Cr quarterly major European destinations Cr ; 3 MetalBulletin Molybdenum Drummed molybdic oxide Free market Mo in warehouse; 4 Ferrous Scrap Index HMS 1&2 (80:20 mix) $ per tonne fob Rotterdam
5/22/2013
15
Facing the new reality
I
Stagnant demand and overcapacities in Europe
II
Increasing imports from non-European countries
III
Decreasing prices and volatile raw material markets
IV
Significant losses for all European producers in recent years
Inoxum acquisition was starting point for restructuring of
EMEA business and returning to profitability
5/22/2013
16
Outline
5/22/2013
17
Outokumpu Strategy Roadmap
+
Restructuring
Deliver on
synergies
Mill closures
Loading
efficiency
Procurement
& raw
materials
Streamlining
overlapping
activities
New
efficiency
projects
P150 project
(€150 million
savings)
P300 project
Working
capital
management
Cold rolling
ferritic
optimization
Transform
company
structure
Ensure
financial
stability
Ramp-up
US presence
Expand
Ferrochrome
New
leadership
Minimize
capex
Ramp-up of
Calvert mill
Double
production
Market
oriented
Business
Areas
Optimize
working
capital
management
Increase
US market
share
Achieve selfsufficiency
Customer
orientation
Pricing and
hedging
strategy
Global Group
functions
Refinancing
Focus on
quality and
profitability
Integrate
Calvert and
Mexinox
=
Growth
Optimize
efficiency
Leverage
HPSA
Strategic
review of
VDM
Strengthen
profitability
of specialty
stainless
Strengthen
operations
in the US
2013 / 2014
Develop
APAC
Grow sales
of specialty
stainless
Leverage
production
at SKS 1)
Performance
Full integration
and new
culture
Advanced
financial
performance
Grow
business in
China, India
and other
South East
Asia
Pursue
market
leader
strategy
2015
1) SKS: Shanghai Krupp Stainless, Outokumpu's cold rolling mill in China.
5/22/2013
18
With strong focus on restructuring in EMEA
+
Restructuring
Deliver on
synergies
Mill closures
Loading
efficiency
Procurement
& raw
materials
Streamlining
overlapping
activities
New
efficiency
projects
P150 project
(€150 million
savings)
P300 project
Working
capital
management
Cold rolling
ferritic
optimization
Transform
company
structure
Ensure
financial
stability
Ramp-up
US presence
Expand
Ferrochrome
New
leadership
Minimize
capex
Ramp-up of
Calvert mill
Double
production
Market
oriented
Business
Areas
Optimize
working
capital
management
Increase
US market
share
Achieve selfsufficiency
Customer
orientation
Pricing and
hedging
strategy
Global Group
functions
Refinancing
Focus on
quality and
profitability
Integrate
Calvert and
Mexinox
=
Growth
Optimize
efficiency
Leverage
HPSA
Develop
APAC
Strategic
review of
VDM
Grow sales
of specialty
stainless
Strengthen
profitability
of specialty
stainless
Leverage
production
at SKS 1)
Strengthen
operations
in the US
2013 / 2014
Performance
Full integration
and new
culture
Advanced
financial
performance
Grow
business in
China, India
and other
South East
Asia
Pursue
market
leader
strategy
2015
1) SKS: Shanghai Krupp Stainless, Outokumpu's cold rolling mill in China.
5/22/2013
19
EMEA synergy savings – High contribution
~ EUR 12 million achieved in Q1 2013
Synergy savings over time (cumulative)
250
Others
Max
EMEA
Min
•
200
150
•
100
50
0
50
16
4
12
38
•
12
Q1 13 2013
Actual Target
2014
Target
Q1 2013: ~ EUR 12 million
10%
1%
2015
Target
2016
Target
2017
Target
Target 2013: ~ EUR 38 million
19%
37%
•
We are on track to reach for targeted
annual savings of EUR 50 million on
group level in 2013
EMEA contributes with approx. 75% to
Q1 and annual savings
Main EMEA synergies in procurement
and production optimization, i.e.
Krefeld melt shop closed by the end
of 2013 and product swaps
Further savings in 2013 also to be
reached by optimization of sales
network and reduction of
administrative cost
44%
89%
Production optimization
Procurement
Sales & Admin
Note: synergy saving target of EUR 200 million includes closures of Krefeld and Bochum melt shops but excludes possible savings from closures in Sweden. Total
expected implementation and non-recurring cumulative cash costs of up to EUR 160 million incurred in 2013-2017.
5/22/2013
20
Ramp-down of Krefeld melt shop is achieved
faster than originally planned
•
Krefeld melting swaps – cumulative ktons per month
•
•
•
•
Jan
Feb
Plan
Mar
Apr
May
Actuals
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Forecast
•
Significant volumes successfully
transferred to Bochum melt shop
Transfers to Tornio progressing
according to plan and being accelerated
to reach 130kt during 2013
Shift reductions: October 2012 from 3
to 2 shifts, July 2013 from 2 to 1 shift
Closure of Krefeld melt shop in Q4 2013
Total cost savings during 2013 expected
to be around EUR 8 million higher than
original plan
Synergy savings:
• EUR 18 million in 2013
• EUR 50 million in 2014 and beyond
5/22/2013
21
New cost-saving programs
P150 program
P300 program
• P150 is aiming an additional cost saving of EUR
150 million on group EBITDA level
• Full implementation and effective until end of
2014
• Main focus of the P150 program are further head
count and general and administration cost
reduction, savings in IT, in procurement and in
Business Areas.
• Considerable impact of EUR 30-50 million
EBITDA expected already in 2013
• New program targeting a net working capital
reduction of EUR 300 million to be achieved
through:
• Inventory reduction
• Accounts receivables
• Accounts payables
EMEA contribution: roughly 20% for the whole
program
• Of the total target we expect to achieve approx.
EUR 150 million working capital reduction already
during 2013
EMEA contribution: Reduction of inventory
days by 6% by the end of 2013
5/22/2013
22
Medium and long term actions well on track
Pricing structure
project
• Developing alternative price models to allow
quicker response to raw material price changes
• From volumes to profit principle
In introduction
phase
Production swaps
• Optimize costs and quality by specialization
• Improved flexibility to respond to market changes
• Working capital optimization
Ahead of target
Service center
strategy
• Increase efficiency
• Focus on selected high end market segments
• Working capital optimization
Strategic review
on service centers
ongoing
5/22/2013
23
Strengthening Research & Development
Transport
Water technology
Renewable energy
Medical applications Household
applications
Architecture
Meeting
customer needs
Process stability & costs, additional benefits
Change R&D culture into “business striker” mentality
Process development
Base material
Surface structure
Topographics
Cost efficiency
 Corrosion resistance
 Mechanical properties
 Suitability for customer
processing
 Prop. of final product
 Easy to clean
 Anti fingerprint
 Scratch resistance
 Color
 Optical appearance
 Reflectivity
 Technical properties
 Melting
 Cold rolling
 Finishing
5/22/2013
24
Focus on emerging industries
•
•
•
•
New base material H500 offers high
light weight potential
Background: The combination of high
strength and high formability offers
interesting light weight potential for
automotive applications
Target: Qualification of H500 for
automotive applications
Status:
• Suitable components identified
• Development of material-oriented
design
5/22/2013
25
Summary
•
•
•
•
•
Targeted EUR 38 million synergy
savings for EMEA well on track
Krefeld melt shop ramp-down is
achieved faster then originally
planned
Production swaps and optimization
of cold rolled production under way
Alternative pricing and alloy
surcharge models being introduced
Ferrochrome ramp-up continues to
support the turnaround of EMEA
5/22/2013
26
Q&A
Outokumpu
Experience
2013
May 22-23, 2013
Old Billingsgate,
London, UK
Appendix
Overcapacity of melting capacity in stainless production–
prior to planned Bochum melt shop closure (May 2013)
EMEA Coil
Germany 1)
Sweden
UK & USA
Calvert
San Luis Potosí
APAC
Total
Shanghai
4,300
1,600
800
500
1,600
800
700
750
865
425
Coil
Coil
500
900
3,970
HR
Melting 2)
Finland
Americas Coil
HPSA
870
CR
3,055
Coil, Plate, Long
105
Long Products
350
270
290
Coil
Coil
Coil
1) After Krefeld melt shop closure in 2013, 2) Actual capacities will vary according to product mix and manning.
5/22/2013
29
Balanced stainless production structure – after the
planned Bochum melt shop closure (May 2013)
EMEA Coil
Sweden
UK & USA
Calvert
1,600
500
500
9006
1,600
700
Finland
Germany 1)
San Luis Potosí
APAC
Total
Shanghai
3,500
3,170
HR
Melting 2)
Americas Coil
HPSA
870
CR
3,055
750
865
Coil
Coil
425
Coil, Plate, Long
105
Long Products
350
270
290
Coil
Coil
Coil
1) Outokumpu management will conduct a final review and decision on Bochum melt shop closure in 2015,
2) Actual capacities will vary according to product mix and manning.
5/22/2013
30
Strongest growth in end-use demand by segment is
forecasted for Chemical / Petrochemical & Energy
CAGR Growth
2013 - 2017
[End-use demand for total stainless steel products]
8%
8%
8%
8%
8%
8%
8%
8%
14%
14%
14%
14%
14%
14%
14%
14%
7%
7%
7%
7%
7%
7%
8%
8%
17%
17%
17%
17%
17%
18%
18%
18%
8%
8%
8%
8%
8%
8%
8%
8%
47%
2011
47%
2012
46%
2013
46%
46%
2014
2015
45%
2016
Metal Processing
Chemical / Petrochemical & Energy
Automotive
Heavy Industries
Architecture / Building & Construction
Consumer Goods & Medical
45%
2017
45%
2018
Consumer
Goods & Medical
3.5%
Automotive
4.5%
Architecture /
Building &
Construction
4.9%
Chemical /
Petrochemical
& Energy
5.2%
Heavy
Industries
5.3%
Metal
Processing
4.7%
Data Source: SMR, April 2013
5/22/2013
31
Strongest growth in end-use demand by grade is
forecasted for Duplex grades
[End-use demand for total stainless steel products]
10%
11%
9%
10%
CAGR Growth
2013 - 2017
10%
11%
10%
10%
Mo containing
300series
47%
46%
47%
46%
47%
45%
45%
45%
27%
28%
27%
28%
28%
29%
29%
29%
15%
15%
15%
15%
15%
14%
14%
14%
1%
1%
1%
1%
1%
1%
2%
2%
2011
2012
2013
2014
2015
2016
2017
2018
Mo Containing 300series
Other 300Series
400series
CrMn Steels
4.6%
Other
300Series
3.6%
400series
5.4%
CrMn
Steels
3.3%
Duplex / Lean
Duplex
13.3%
Duplex / Lean Duplex
Data Source: SMR, April 2013
5/22/2013
32
Price gaps between Asia and Europe trigger Chinese
imports
25,000
Transaction price gap grade 304, 2mm [US$/t]
China imports (EU27) [tonnes]
20,000
1,750
1,500
1,250
15,000
1,000
10,000
750
500
5,000
250
0
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2013
2011
2012
2006
2007
2008
2009
2010
• ~17% of all third country imports into EU27 came from China in 2012.
Data Source: CRU Eurofer, May 2013
5/22/2013
33
Development of European transaction prices
Reference: Austenitic 304 (1.4301), Cold rolled,
SSC/Traders, sheet 2mm
European transaction price [EUR/t]
•
Nickel price [USD/t]
5,000
55,000
4,500
50,000
4,000
45,000
3,500
40,000
35,000
3,000
30,000
2,500
•
•
Nickel volatility is the major concern
for all Stainless Producers
~80% of production costs of stainless
steel are raw material related.
>50% of production costs are subject
to market speculation
25,000
2,000
20,000
1,500
15,000
1,000
10,000
500
5,000
0
0
Jan Jan Jan Jan Jan Jan Jan Jan Jan Jan Jan Jan Jan Jan
00 01 02 03 04 05 06 07 08 09 10 11 12 13
Alloy Surcharge EU
Base Price EU
Nickel
Data source: CRU April 2013; LME Nickel
5/22/2013
34
EMEA operating model designed to improve performance
measurability by clear accountabilities
Target model: functional accountabilities & KPIs
Business Area EMEA - Profitability
Production
Production
Production
Production
Procurement
Production
Production
Supply Chain Management
Production
Supply Chain
Management
Production
Supply Chain
Management
Sales
Production
Sales
Production
Sales
KPIs
•
•
•
•
1
2
3
4
KPIs
• 1
• 2
• 3
KPIs
•
•
•
•
•
•
•
1
2
3
4
5
6
7
KPIs
• 1
• 2
5/22/2013
35

EMEA presentation by Ulrich Albrecht-Früh

Transcrição

Documentos relacionados

Pro-forma for order 2012/712 Confederation Mondiale Des Activites

eco worktop cupboards with upstand

ECO PASS THROUGH HOT CUPBOARDS

MAYNARD´S FINE RUBY PORT

community herbal monograph on psyllium seed

ECO PASS THROUGH WORKTOP CUPBOARDS

worktop cupboards with upstand

Joneo Lopes do Nascimento Jose Luiz Fernandes Cassio Barbosa

Clean Phone

worktop cupboards

File