Jewellery & Industrial Metals Jewellery & Industrial Metals Dietmar Becker Dietmar Becker – – Senior Vice President Senior Vice President Capital Markets Event on Recycling Capital Markets Event on Recycling – – 18 18 - - 19 Nov 2010 19 Nov 2010
Jewellery & Industrial MetalsJewellery & Industrial MetalsDietmar Becker Dietmar Becker ––
Senior Vice PresidentSenior Vice President
Capital Markets Event on Recycling Capital Markets Event on Recycling ––
1818--19 Nov 201019 Nov 2010
2
Jewellery & Industrial Metals
Provides gold, silver and other precious metals containing products to the jewellery sector and industrial applications
Closed loop offering for precious metals products, refining and related supply services
•
Recycling of high-value scraps & sweeps
Multi-regional business concept, strong in Europe and expanding worldwide•
#1 gold and silver semi-finished products in Europe
•
#1 machined platinum alloy products for jewellery
in Europe
The business unit includes Allgemeine
Gold & Silberscheideanstalt
AG (listed company, 91% owned by Umicore)
3
Agenda
•
Business model
•
Key customer groups
•
Jewellery & Lifestyle
•
Industry
•
Business strategy
5
Business model
Leading supplier of precious metals and products for Jewellery and Industrial Metals
Customer vicinity and presence in relevant regional key markets
Refining and supply services combined with precious metals management
One-stop-shop PM cycle offering with complete customer service leading to competitive advantage
material
solutions
Ag Au
Pt Pd
Cu
Applicationknow-how
Recycling
Chemistry
Material science
Metallurgy
Life style Jewellery
Chemistry
Electrical
Medical
6
Recycling volume (indexed)
0
1
2
3
4
2005 2006 2007 2008 2009 2010
Au Ag Pt
Product volume (indexed)
0
1
2
3
4
2005 2006 2007 2008 2009 2010
Business model
Full product and service offering to multi-regional markets offering•
Wide range of customized products
•
Refining/Recycling services
•
Analytical & Applied Tech services
Market leader in Europe in several segments with growing business in Asia and North-America
Strong supply advantage by recycling
•
70-100% of Au
•
50% of Ag
•
40% of Pt
50% of all refining customers also buy products, 50% of delivered product volume comes back as recycling feed
Source: Umicore actuals
& estimates
7
Foshan China # 31
•
Refining/recycling•
Production
BangkokThailand # 56
•
Refining/recycling•
Production
TorontoCanada # 58
•
Production•
Refining/recycling
ViennaAustria # 93
•
Production•
Refining/recycling
Pforzheim Germany # 357
•
Headquarters•
Refining/recycling•
Production
Amsterdam
Netherlands # 58
•
Production
Manaus Brazil # 12
•
Production
People
Total workforce : 651 people
9
Key Customer Groups Jewellery & Industrial Metals
Au
5%
95%
Jewellery
Industry
Ag
85%
15%Jewellery
Industry
Core competencies are built on know-how•
Precious metals metallurgy
•
Chemistry
•
Material science
•
Customer service
Main presence of gold in jewellery
and silver in industry segment
BU Jewellery & Industrial Metals gives access to the largest segment of gold recycling
Source: Umicore actuals
10
Recycling
PlatinumPlatinum
Recycled scrap, sweeps, solutions
Recycled scrap, sweeps, solutions
Jewellery scrapJewellery scrap
SilverSilver
GoldGold
Secondary materialsSecondary materials
Primary materialsPrimary materials
Complex
recycling
residues
Common
raw
materials
Complex
raw
materials
Special
high-grade
recyclables
PalladiumPalladium
11
Supply Metal Product Application Market
Gold
Silver
Lifestyle goods
Sheets, wires
Fine metals, alloys, solders
Platinum, Palladium
Recycled scrap, sweeps, solutions
Sheets, strips, plates, discs, tubes, rings, …
Medal / Coin blanks
Art medals Private art collectors
Old jewellery
Local GoldsmithsJewellery industry
Watches
Jewellery -
Value Chain
Fashion jewellery
Rings
High-end jewellery
Fashion products
12
Jewellery Market dynamics
World jewellery fabrication volume declined significantly in last decade driven by economy and gold price development
Off-shoring of low price segment jewellery producers to low-cost countries
Emerging jewellery markets in Far East along with economic development and individual
wealth increase
Traditional local/regional markets still important
Top luxury brand segments remain strong
Jewellery scrap recycling increased, offering opportunities for Umicore
Global gold consumption
0
1,000
2,000
3,000
4,000
2000 2008 2009
(in tonnes)
Jewellery
Industry
Investment
0.0
0.5
1.0
1.5
2.0
2000 2008 2009
China
Global
Source: GFMS
Evolution gold jewellery consumption
13
Jewellery Market position & approach
Europe as successful home market•
# 1 Au jewellery refining
•
# 1 Pt and Ag semi-finished products
Recent investments in Asia (Thailand and China) and acquisitions
(Canada)
have complemented the growth of the business•
Thailand has gained importance as manufacturing base for fashion
jewellery
(e.g. Pandora, Swarowski)
•
China is a growing market in both industrial and jewellery segment
Well positioned at leading luxury brands
Competitors:•
Metalor, Other Swiss, Cookson, local Pforzheim companies, …
14
Industrial Metals –
Value Chain
Supply Metal Product Application Market
Gold
Silver
Medical device industry
Electrical and PM fabrication
Sputter targets, machined parts, evaporation
materials
Silver catalysts
Platinum, Palladium
Recycled scrap, sweeps, solutions
Sheets, strips, plates, discs, tubes, wires, solders, rings, …
Formaldehyde synthesisChemical, leather,
wood industries, …
Photovoltaic, Semiconductor,
High purity silicon producers, coating uses,
Medal / Coin blanks
Coins Investors, collectors
Old jewellery
Medical equipment
Industrial Customers
Fresh Ag granules
15
Industrial Metals Market dynamics
Overall significant growth of silver
demand in industrial fabrication and new energy technologies
Ongoing demand for coins
as “safe haven”
by
investors, with trend towards special alloys with
les silver content to compensate for higher PM prices
Demand for PM targets and silver anodes used in
surface technology
expected to grow in line with GDP
and poly-silicon industry recovery respectively
Silver catalysts for use in the formaldehyde
industry, expected to grow according to GDP
Increasing demand from automotive industry
expected, with recent upswing in production
Medical industry
expected to continue on a steady growth path
Global Ag consumption
0
3,000
6,000
9,000
12,000
15,000
2000 2008 2009 2010
(in tonnes)
Jewellery
Industry
Photography
Silverware
Investment
Source: GFMS + 2010 Umicore estimate
16
Industrial Metals Market position & approach
Europe remains of high relevance i.e. for high quality and technology;
Umicore is # 1 for silver semi-finished products in Europe
Industry and coins are the two main development and growth segments
with China being a main growth market
Industrial niche markets in PV, chemical and medical industry with organic growth opportunities
Recycling and market knowhow and large manufacturing capability and capacity leads to competitive advantage over Metalor, Cookson and several local Pforzheim companies
Source: GFMS
18
Business strategy
Europe is Umicore’s successful home market
Strengthen and broaden current position by leveraging
•
Presence with top brand customers
•
Industrial opportunities in photovoltaic, chemical, electrical, automotive and medical industries
•
Expansion into other regions, in particular Asia and North America
Pursuing front-end outsourcing opportunities
Development of jewellery and industrial refining business (scrap, sweep)
19
Forward-looking statements
This presentation contains forward-looking information that involves risks and uncertainties, including statements about Umicore’s plans, objectives, expectations and intentions.
Readers are cautioned that forward-looking statements include known and unknown risks and are subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of Umicore.
Should one or more of these risks, uncertainties or contingencies materialize, or should any underlying assumptions prove incorrect, actual results could vary materially from those anticipated, expected, estimated or projected.
As a result, neither Umicore nor any other person assumes any responsibility for the accuracy of these forward-looking statements.
20
Dietmar Becker Senior Vice President Jewellery & Industrial Metals
Dietmar Becker holds a university degree in Economics and Organisational Sciences. He started working for Degussa AG –
part of which was acquired by Umicore in 2003 -
in 1988, heading a number of businesses in Germany as well as in Italy, prior to being appointed Senior Vice-
President Technical Materials in 2007. He became Senior Vice-President of the newly created business unit Jewellery & Industrial Metals in 2010.