voestalpine AG www.voestalpine.com voestalpine AG Welcome! 23 rd Annual General Meeting of voestalpine AG Linz, July 1, 2015
voestalpine AG www.voestalpine.com voestalpine AG
Welcome! 23rd Annual General Meeting of voestalpine AG Linz, July 1, 2015
voestalpine AG www.voestalpine.com voestalpine AG
23rd Annual General Meeting of voestalpine AG Linz, July 1, 2015
voestalpine AG | |
Agenda item 1 Presentation of the adopted Annual Financial Statements of voestalpine AG, of the Management Report, which has been combined with the
Consolidated Management Report, of the recommendation for appropriation of net profit, of the Consolidated Annual Financial Statements, of the Corporate Governance Report, and of the Report of the Supervisory Board
07/01/2015 23rd Annual General Meeting of voestalpine AG 3
voestalpine AG www.voestalpine.com voestalpine AG
Business year 2014/15 of the voestalpine Group 23rd Annual General Meeting of voestalpine AG
voestalpine AG | | 07/01/2015 23rd Annual General Meeting of voestalpine AG 5
Business environment, highlights
voestalpine AG | |
Business year 2014/15 Economic environment Global economic development uneven
Europe (euro zone): overall volatile and subdued development, moderate economic revival in the last quarter (“quantitative easing” by ECB, EU investment offensive)
North America: continuing growth; consolidation phase in early 2015
China: high growth rates at stable level (+7%) Brazil and Russia: between stagnation and recession
Deflationary raw materials prices (ore, oil); shifts in rates of exchange (esp. US dollar vs. euro)
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voestalpine AG | |
Business year 2014/15 voestalpine Group – Highlights (1) Despite negative price trends (iron ore, oil), revenue slightly up
to EUR 11.2 billion EBITDA rose to EUR 1.53 billion (+11.4%), EBIT increased to
EUR 886 million (+12.4%) Positive non-recurring effects (EBITDA EUR 61.9 million,
EBIT EUR 45.2 million) Profit before tax and profit for the period rose disproportionately from
EUR 641 million to EUR 741 million and EUR 503 million to EUR 594 million respectively
Gearing ratio at 58.4% higher than previous year (46%) special effects in statement of financial position
Proposed dividend: EUR 1.00 per share (previous year: EUR 0.95) Figures for business year 2013/14 retroactively adjusted.
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voestalpine AG | |
Business year 2014/15 voestalpine Group – Highlights (2) Efficiency improvement and cost optimization program
shows first effects on earnings Employment stable at high level:
More than 52% of core staff outside of Austria At around 23,000 employees, employment record in Austria
Direct reduction plant in Texas to 60% completed; largest ever Austrian foreign investment in the USA
Investment at record high: Increase from EUR 936 million to nearly EUR 1.2 billion For the first time, approx. 50% of investments outside of Austria
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voestalpine AG | |
voestalpine Group: Development of investments
455
272 365
512 600 601
94
112
145
243 182 231
17
39
65
96 154
346
566
423
575
851 936
1,178
0
200
400
600
800
1000
1200
2005/06 (…) 2010/11 2011/12 2012/13 2013/14 2014/15
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(in EUR million)
Rest of world
Austria
Other EU
∑ of the past 10 years: EUR 11 billion
voestalpine AG | |
voestalpine Group: Development of investments
455
272 365
512 600 601
94
112
145
243 182 231
17
39
65
96 154
346
566
423
575
851 936
1,178
0
200
400
600
800
1000
1200
2005/06 (…) 2010/11 2011/12 2012/13 2013/14 2014/15
2005/06
2010/11
2014/15
20
35
49
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(in EUR million)
(in %)
Rest of world
Austria
Other EU
∑ of the past 10 years: EUR 11 billion
voestalpine AG | | 07/01/2015 23rd Annual General Meeting of voestalpine AG 11
Overview of key figures
voestalpine AG | |
2013/14* 2014/15 Change (%)
Revenue EUR million 11,077.2 11,189.5 +1.0
voestalpine Group Development of key figures * Figures retroactively adjusted
** Proposal to the AGM
07/01/2015 23rd Annual General Meeting of voestalpine AG 12
voestalpine AG | |
2013/14* 2014/15 Change (%)
Revenue EUR million 11,077.2 11,189.5 +1.0
Operating result (EBITDA) EUR million 1,374.0 1,530.2 +11.4
EBITDA margin % 12.4 13.7
voestalpine Group Development of key figures * Figures retroactively adjusted
** Proposal to the AGM
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voestalpine AG | |
voestalpine vs. European steel industry Development of EBITDA margin
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voestalpine Quarterly comparison: EBITDA in % of revenue; Sources: Bloomberg, company reports
2011 2012 2013 2014 2015
voestalpine AG | |
2013/14* 2014/15 Change (%)
Revenue EUR million 11,077.2 11,189.5 +1.0
Operating result (EBITDA) EUR million 1,374.0 1,530.2 +11.4
EBITDA margin % 12.4 13.7
Profit from operations (EBIT) EUR million 788.4 886.3 +12.4
EBIT margin % 7.1 7.9
voestalpine Group Development of key figures * Figures retroactively adjusted
** Proposal to the AGM
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voestalpine AG | |
voestalpine vs. European steel industry Development of EBIT margin
07/01/2015 23rd Annual General Meeting of voestalpine AG 16
2011 2012 2013 2014 2015
voestalpine Quarterly comparison: EBIT in % of revenue; Sources: Bloomberg, company reports
voestalpine AG | |
voestalpine Group Long-term comparison of EBIT/EBITDA margins
17.3%
19.6%
17.5%
14.6%
11.7%
14.7%
10.8% 12.4% 12.4%
13.7%
0
2000
4000
6000
8000
10000
12000
14000
IST 2005/06 IST 2006/07 IST 2007/08 IST 2008/09 IST 2009/10 IST 2010/11 IST 2011/12 IST 2012/13 IST 2013/14 IST 2014/15
Umsatz (Mio EUR) EBIT in % vom Umsatz EBITDA in % vom UmsatzEBITDA in % of revenue
Revenue (EUR million) 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
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2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
voestalpine AG | |
voestalpine Group Long-term comparison of EBIT/EBITDA margins
11.6%
14.6%
11.0%
8.4%
4.1%
9.0%
5.8% 7.3% 7.1%
7.9%
17.3%
19.6%
17.5%
14.6%
11.7%
14.7%
10.8% 12.4% 12.4%
13.7%
0
2000
4000
6000
8000
10000
12000
14000
IST 2005/06 IST 2006/07 IST 2007/08 IST 2008/09 IST 2009/10 IST 2010/11 IST 2011/12 IST 2012/13 IST 2013/14 IST 2014/15
Umsatz (Mio EUR) EBIT in % vom Umsatz EBITDA in % vom UmsatzEBITDA in % of revenue Revenue (EUR million) EBIT in % of revenue 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
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2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
voestalpine AG | |
2013/14* 2014/15 Change (%)
Revenue EUR million 11,077.2 11,189.5 +1.0
Operating result (EBITDA) EUR million 1,374.0 1,530.2 +11.4
EBITDA margin % 12.4 13.7
Profit from operations (EBIT) EUR million 788.4 886.3 +12.4
EBIT margin % 7.1 7.9
Profit before tax (EBT) EUR million 640.8 740.9 +15.6
Profit for the period EUR million 503.4 594.2 +18.0
voestalpine Group Development of key figures * Figures retroactively adjusted
** Before deduction of non-controlling interests and interest on hybrid capital
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**
voestalpine AG | |
2013/14* 2014/15 Change (%)
Revenue EUR million 11,077.2 11,189.5 +1.0
Operating result (EBITDA) EUR million 1,374.0 1,530.2 +11.4
EBITDA margin % 12.4 13.7
Profit from operations (EBIT) EUR million 788.4 886.3 +12.4
EBIT margin % 7.1 7.9
Profit before tax (EBT) EUR million 640.8 740.9 +15.6
Profit for the period EUR million 503.4 594.2 +18.0
Earnings per share (EPS) EUR 2.59 3.11 +20.1
Dividend per share** EUR 0.95 1.00 +5.3
voestalpine Group Development of key figures * Figures retroactively adjusted
** Proposal to the AGM
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voestalpine AG | |
voestalpine AG: Dividend
Continuous dividend payments since IPO in 1995 – total: EUR 2.2 billion
Dividend payments (in EUR million) Dividend yield
* Proposal to the AGM
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*
Dividend yield
24% 31%
48%
33%
78%
26%
41% 35% 37%
32%
2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
Distribution ratio
*
123
235
341
176
84
135 135 155 164
172
4.3% 4.1% 4.0%
3.6%
2.2%
2.8% 2.9%
3.8%
3.0% 3.0%
0
50
100
150
200
250
300
350
400
2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
Ø last 10 years: 3.4 % Ø last 10 years: 38 %
voestalpine AG | |
voestalpine Group Development of gearing ratio
377 526
3,572 3,762
3,037 2,713 2,586
2,259 2,421
2,978 2,547
2,882
4,289 4,263 4,262 4,691 4,836
5,075 5,262 5,103
15% 18%
83% 88%
71%
58% 54%
45% 46%
58%
2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
Net financial debt (EUR million)
Equity (EUR million)
Gearing ratio (%)
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voestalpine AG | |
voestalpine Group R&D expenses R&D expenses
R&D budget
07/01/2015 23rd Annual General Meeting of voestalpine AG 23
(in EUR million)
Ø annual increase in the last 10 years: 8.5%
61 66
93
112 109 109 117
126 128 127
141
0
20
40
60
80
100
120
140
2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
voestalpine AG | |
voestalpine Group Environmental expenses
23rd Annual General Meeting of voestalpine AG 24
(in EUR million; based on Austrian Group locations)
07/01/2015
∑ in the last 10 years: ~ EUR 2.5 bn
42
222
219 236
267 274
241 214
244 240 241 264
0
50
100
150
200
250
300
2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
Environmental investments Environmental operating expenses Total
voestalpine AG | |
Overview of divisions
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voestalpine AG | |
Steel Special Steel Metal Engineering
Metal Forming
Group
Revenue (EUR million) 3,873.9 2,777.4 2,593.0 2,335.2 11,189.5
Share of Group revenue (%) 34 24 22 20
Business year 2014/15 Key figures of the divisions
07/01/2015 23rd Annual General Meeting of voestalpine AG 26
voestalpine AG | |
Steel Special Steel Metal Engineering
Metal Forming
Group
Revenue (EUR million) 3,873.9 2,777.4 2,593.0 2,335.2 11,189.5
Share of Group revenue (%) 34 24 22 20
EBITDA (EUR million) 450.3 407.0 419.8 331.3 1.530.2
EBITDA margin (%) 11.6 14.7 16.2 14.2 13.7
Business year 2014/15 Key figures of the divisions
07/01/2015 23rd Annual General Meeting of voestalpine AG 27
voestalpine AG | |
Steel Special Steel Metal Engineering
Metal Forming
Group
Revenue (EUR million) 3,873.9 2,777.4 2,593.0 2,335.2 11,189.5
Share of Group revenue (%) 34 24 22 20
EBITDA (EUR million) 450.3 407.0 419.8 331.3 1.530.2
EBITDA margin (%) 11.6 14.7 16.2 14.2 13.7
EBIT (EUR million) 208.0 253.7 292.1 220.7 886.3
EBIT margin (%) 5.4 9.1 11.3 9.5 7.9
Business year 2014/15 Key figures of the divisions
07/01/2015 23rd Annual General Meeting of voestalpine AG 28
voestalpine AG | |
Steel Special Steel Metal Engineering
Metal Forming
Group
Revenue (EUR million) 3,873.9 2,777.4 2,593.0 2,335.2 11,189.5
Share of Group revenue (%) 34 24 22 20
EBITDA (EUR million) 450.3 407.0 419.8 331.3 1.530.2
EBITDA margin (%) 11.6 14.7 16.2 14.2 13.7
EBIT (EUR million) 208.0 253.7 292.1 220.7 886.3
EBIT margin (%) 5.4 9.1 11.3 9.5 7.9
Employees (FTE) 11,103 13,490 11,685 10,328 47,418
Business year 2014/15 Key figures of the divisions
07/01/2015 23rd Annual General Meeting of voestalpine AG 29
voestalpine AG | |
Business year 2014/15 Steel Division – Highlights Market environment continues to be difficult
Massive overcapacity and concurrently, falling raw materials prices continuing price pressure on commodities
Slight pick-up in demand beginning in last quarter of business year
voestalpine: Stable, good level of demand from all important customer industries Record production and delivery volumes Steel Division continues to be profitability benchmark for the steel industry in the EU Investments 61% above previous year‘s figure – focus on direct reduction plant in the USA
07/01/2015 23rd Annual General Meeting of voestalpine AG 30
voestalpine AG | | 31 07/01/2015 23rd Annual General Meeting of voestalpine AG
Project in Texas on schedule Absolute environmental benchmark Construction
Completion by the end of 2015 Currently, 1,300 construction workers 137-meter-high reduction tower 2/3 completed, loading port completed
Customers 80% of sales volume already contractually fixed
Suppliers Full supply of pre-material (iron ore pellets) ensured
Environment Zero waste due to recycling of iron dust and iron slurry Maximum raw material efficiency by pressing dust into briquettes Closed water piping system
voestalpine AG | |
Business year 2014/15 Special Steel Division Regionally inconsistent, but overall improved market environment Subdued development in Europe USA and China continue to be dynamic Automotive and consumer goods segments drive solid demand for tool steel;
strong development in the aerospace industry
Energy: power plant construction (esp. in Europe) continues to be weak; situation in oil and natural gas exploration still satisfactory in 2014
Continuing expansion of global market leadership due to value-added strategy in technologically sophisticated product segments
07/01/2015 23rd Annual General Meeting of voestalpine AG 32
voestalpine AG | |
Business year 2014/15 Metal Engineering Division Again robust performance with regard to operating results and earnings in all
business segments due to strong demand in the most important customer industries High demand for rails, primarily for European railway infrastructure projects
Turnout technology maintains high momentum worldwide
Solid business performance in the Wire segment (automobile industry)
No major consequences of the low oil price on the seamless tube segment in 2014
Stable development in the Welding Consumables (welding technology) business segment
07/01/2015 23rd Annual General Meeting of voestalpine AG 33
voestalpine AG | |
Business year 2014/15 Metal Forming Division Successful start-up of operations at new production sites in China, South Africa,
and the USA; further expansion is being implemented (“phs-ultraform®“) Divestment of Flamco and Plastics Group results in portfolio optimization Development of individual business segments: Strong performance in the Automotive Body Parts segment Inconsistent market environment for Tubes & Sections; aerospace industry is strong,
construction industry shows only tentative recovery; commercial vehicles segment continues to be weak
Precision Strip segment holds its own against new capacities in Asia Warehouse & Rack Solutions segment demonstrates very strong performance
07/01/2015 23rd Annual General Meeting of voestalpine AG 34
voestalpine AG | |
Climate and energy
07/01/2015 23rd Annual General Meeting of voestalpine AG 35
voestalpine AG | |
Climate and energy Current developments Intervention in the current emissions trading scheme resolved starting already in 2019
Increase of CO2 price by marked and permanent reduction of emission trading certificates already prior to 2020
Reform of EU emissions trading (for the period from 2021 to 2030) Will protective measures for the most environmentally friendly companies also be defined or
only the burdens? Recently, negative indications from the Commission (benchmark allocation and carbon leakage
measures insufficient and clearly contradictory to guidelines set forth by the Council) UN Climate Conference in Paris, November 30 – December 11, 2015
Uniform and binding global regulations or continued unilateral pioneering role of the EU? EU energy union
Affordable and available energy through coordinated EU policies or a patchwork of national regulations?
07/01/2015 23rd Annual General Meeting of voestalpine AG 36
voestalpine AG | |
46% 54%
CO2 emissions trading Effects on voestalpine Group
28%
72%
2008–2012 2013–2020
Free allowances
Purchase requirement
3%
97%
2021–2030
~ 1.8 million certificates
~ 28 million certificates
~ 60 million certificates
ETS target: -21% ETS target: -43%
~ 11 €/t: ∑ ~ € 20 million at Ø 10 €/t: ∑ ~ € 280 million at Ø 15 €/t: ∑ ~ € 420 million
at Ø 30 €/t: ∑ ~ € 1.8 bn
Basis: voestalpine‘s CO2 emissions/real emissions and forecasts at current carbon leakage protection levels
07/01/2015 23rd Annual General Meeting of voestalpine AG 37
voestalpine AG | |
CO2 emissions by regions Development 1990 – 2013
+11%
+195%
-34%
+240%
-9%
-18%
+8%
+285%
-50% 0% 50% 100% 150% 200% 250% 300%
China
USA
EU(28)
India
Russia
Middle East
Austria
Sources: WV Stahl, United Nations Statistics Division (Millennium Development Goals Indicators)
Japan
07/01/2015 23rd Annual General Meeting of voestalpine AG 38
voestalpine AG | |
voestalpine Group: Outlook 2015/16 North America: solid growth aside from seasonal fluctuation China/Southeast Asia: unchanged, stable development (with the
exception of commodities) India: increasing revival of economy Brazil, Russia: continuing economic problems cannot be solved in the
short term EU: trend reversal in the “crisis countries”; weak euro and economic
measures by EU Commission and ECB stimulate economic development in 2015; effects of situation in Greece??
Oil price development: negative, direct impact on oil and natural gas sectors, but positive for broad-based consumer behavior
Automobile and mechanical engineering sectors, railway infrastructure, aerospace industry: strong development
07/01/2015 23rd Annual General Meeting of voestalpine AG 39
Expectation 2015/16: further improvement of EBITDA and EBIT
voestalpine AG www.voestalpine.com voestalpine AG
Business year 2014/15 of the voestalpine Group 23rd Annual General Meeting of voestalpine AG