debt investor update · 2020. 6. 11. · global market leader in railway infrastructure; european...

www.voestalpine.comvoestalpine AG

DEBT INVESTOR UPDATEBUSINESS YEAR 2019/20

| |voestalpine AG

» voestalpine is a leading technology and capital goods group withcombined material and processing expertise

» It is holding global top positions in its business units

» The group focuses on most demanding product and system solutionsbased on steel and other metals in technology-intensive industries andniches

» Clear focus on strategically in the long run most promising sectors likemobility and energy

» Long-term relationships with customers, suppliers and R&D-institutionsas key drivers for innovation

June 20202 Debt Investor Relations

voestalpine GROUPOVERVIEW

| |voestalpine AG3

One Group – 500 sites – 50 countries – 5 continents

Debt Investor Relations

voestalpine GROUPGLOBAL FOOTPRINT

INCREASING NON-EU-BUSINESS, MOBILITY-SECTOR STABLE

June 2020

| |voestalpine AG

voestalpine GROUPSHAREHOLDER STRUCTURE

4 Debt Investor Relations

Major individual shareholders (as of March 31, 2018)

Raiffeisenlandesbank Oberösterreich Invest GmbH & Co KG < 15 %

voestalpine employee shareholding scheme 14.8 %

Oberbank AG 8.1 %

Ownership structure according to regions (Figures as of March 31, 2020)

June 2020

| |voestalpine AG

-30

-20

-10

0

10

20

30

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08

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09

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20

voestalpine AG Steel-Peer-Group

-30

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0

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30

Q3

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08

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08

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14

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voestalpine Group Steel DivisionHigh Performance Metals Division Metal Engineering DivisionMetal Forming Division

voestalpine GROUPSOLID PERFORMANCE IN A CYCLICAL BUSINESS


EBIT margin (%) by divisions

Solid performance due to...

... a diversified portfolio ... a long value chain

... positioning in various market segments ... focus on innovation, service and cost efficiency

... partial backward integration

EBIT margin (%) voestalpine AG vs. European competitors

Lower volatility in earningsand higher profitability thanSteel-Peer competitors!

(excluding impairments) (excluding impairments)

June 2020

| |voestalpine AG

» Reduced utilization in many production facilities of voestalpine

» Shut down of blast furnace number 5 in Linz

» Output of EAFs of HPM Division adjusted to demand

» Reduced output at many industrial plants (automotive components,

roll-forming, etc.) according to demand

» 10,000 employees in short time work in Austria, 5,000 in similarsystems in other countries and regions of the world

» Restructuring of businesses, where we expect the downturn tobe structural and not only cyclical and COVID-driven


voestalpine GROUPCOVID-19 UPDATE, 03.06.2020

| |voestalpine AG

» Automotive industry has restarted car production at end ofApril / beginning of May in Europe and North America

» Our Chinese business is up and running on levels prior toCOVID-19 – not only in automotive

» Railway Systems business is continuing to perform well evenduring spread of COVID-19

» Warehouse and Rack Solutions business faces additional pushfrom e-commerce after COVID lockdown on top of alreadystrong demand before


voestalpine GROUPCOVID-19 UPDATE, 03.06.2020

| |voestalpine AG

voestalpine GROUPBUSINESS ENVIRONMENT BY 2019/20


» Slowing economic momentum over first nine months of BY 2019/20, recovery started in last businessquarter but ended abruptly by COVID-19 spread

» Trade war impacted growth on global scale, Europe and China harmed considerably

» Automotive industry stagnated in North America, slowed in Europe and slumped in China

» Energy industry suffered from low oil and gas prices and trade barriers in the US, additional collapse of the oil-pricein the last quarter

» Railways business continued to do well in most regions of the world over the entire business year 2019/20

» Steel industry faced margin pressure from rising raw material cost, in particular iron ore, in a shrinkingdemand environment in Europe

» Spread of COVID-19 pandemic in the last quarter 2019/20

» Chinese business heavily affected in February but quick recovery since then

» European and American business heavily affected since mid of March

| |voestalpine AG

voestalpine GROUPDEVELOPMENTS BY 2019/20


» In this environment the focus of the management of voestalpine was clearly put on cost- and workingcapital management, cash generation and deleveraging of the balance sheet

» What have we achieved?» EBITDA close to EUR 1.2 billion

» Free Cash Flow close to EUR 600 million, Cash Flow from operations above EUR 1.3 billion

» Working Capital release of around EUR 430 million

» Capex reduced to less than EUR 800 million (for next BY 2020/21 down to EUR 600 million)

» Headcount reduced by more than 4%

» Comfortable liquidity of EUR 1.7 billion per end of March 2020

» Gearing ratio at 67% by end of March 2020. A move in the right direction after high levels during BY 2019/20, alsocaused by the call of the hybrid bond (EUR 500 million change from equity to debt), change in IFRS accountingstandards (EUR 440 million additional debt) and dividend payment in BY 2019/20 (EUR 220 million equity reduction

| |voestalpine AG

voestalpine GROUPNON RECURRING ITEMS BY 2019/20


» We conducted a strategic analysis of the changed global economic environment and its impact on ourmajor business areas

» The outcome forced us to adapt some long-term assumptions in specific business areas

» Consequently, we had to revalue certain assets of those business areas and therefor recordedimpairments

» Additionally we had to build provisions for restructuring and other risks

» Non recurring items included in earnings of voestalpine Group in BY 2019/20:

» EBITDA: EUR -85 million: provision for restructuring and other risk

» EBIT: EUR -485 million: EUR 400 million impairments + EBITDA effects

| |voestalpine AG

BUSINESS DEVELOPMENTBY 2019/20


| |voestalpine AG

voestalpine GROUPCOMPANY STRUCTURE AND MARKET POSITION


SteelDivision

High Performance MetalsDivision

Metal EngineeringDivision

Metal FormingDivision

Global quality leadership Global leadership Global leadership Global leadershipGlobal quality leadership inhighest quality steel strip andmarket leader in heavy plate andfoundry products for the mostsophisticated energyapplications.

Worldwide leadership in toolsteel, leading position in high-speed steel, aircraft, specialforgings and powdertechnology. Innovation leader inadditive manufacturing.

Global market leader inrailway infrastructure; Europeanmarket leader inspecially treated wire; andleading position in seamlesstubes for special applicationsand high-quality full weldingsolutions.

Global market leader in definedhigh-tech niches with highestquality demands supplyingmetal processing solutions witha global network for generatingmaximum customer value.

35% 22%22% 21%

More information about voestalpine‘s business models and facts is available online:http://www.voestalpine.com/group/static/sites/group/.downloads/de/aktie/praesentation/2018-19-business-model-and-facts-voestalpine-group.pdf

voestalpine Group (Revenue in BY 2019/20)

June 2020

| |voestalpine AG

» Overall difficult year for European steel industry

» Slowing demand from automotive and mechanicalengineering industry, sluggish energy- and white goodsindustries; only building and construction industryrobust

» Margin pressure due to rising raw material prices, inparticular iron ore

» Difficult market conditions for HBI in the 2nd half

» Impairments at HBI plant and foundry group in 2nd halfof BY 2019/20

» Improving market dynamics in last quarter of BY2019/20 stopped by spread of COVID-19

» One small blast furnace shut down in March to alignproduction output to sudden slump of demand

STEEL DIVISIONBUSINESS DEVELOPMENT BY 2019/20

June 202013

€mQ1

19/20

Q2

19/20

Q3

19/20

Q4

19/20

BY

19/20

BY

18/19

Delta

in %

Revenue 1,182 1,139 1,098 1,151 4,571 4,887 -6.5

EBITDA 151 110 97 137 494 653 -24.4

EBITDA-% 12.7% 9.6% 8.8% 11.9% 10.8% 13.4%

EBIT 61 20 -193 12 -101 319 -131.5

EBIT-% 5.1% 1.8% -17.6% 1.0% -2.2% 6.5%


| |voestalpine AG

» Tool Steel facing challenging market environment overentire BY 2019/20

» Special Materials for aerospace and oil & gas-industrywith solid development in first nine month of thebusiness year, but slowdown in 4th quarter

» Europe most difficult market, restructuring of Germanspecial Steel plant Buderus

» North American market muted and difficult to accessafter sec. 232

» Quick recovery in China after COVID-19 lockdown

» EAF steelwork production is fairly flexible, outputaligned to demand

HIGH PERFORMANCE METALS DIVISIONBUSINESS DEVELOPMENT BY 2019/20

June 202014

€mQ1

19/20

Q2

19/20

Q3

19/20

Q4

19/20

BY

19/20

BY

18/19

Delta

in %

Revenue 778 723 676 715 2,891 3,136 -7.8

EBITDA 99 78 7 92 276 435 -36.5

EBITDA-% 12.8% 10.8% 1.0% 12.8% 9.5% 13.9%

EBIT 57 35 -48 32 77 280 -72.6

EBIT-% 7.3% 4.9% -7.1% 4.5% 2.6% 8.9%


| |voestalpine AG

» Railway Systems unchanged positive» Sound development of Turnout Systems in most regions

» Rails segment with good demand in Europe

» Successful acquisitions in France & China

» Mixed picture in industrial Systems» Tubulars (OCTG) impacted by softening oil & gas sector and

US-tariffs up from 2H BY 2019/20, additional slump in oil-price at the end of the business year

» Wire business confronted by lower demand fromautomotive and price pressure from EAF competition

» Stable development in Welding Consumables, acquisition ofSelco makes us a full service provider in the weldingbusiness

» COVID-19 with fairly limited impact on railway systems

METAL ENGINEERING DIVISIONBUSINESS DEVELOPMENT BY 2019/20

June 202015

€mQ1

19/20

Q2

19/20

Q3

19/20

Q4

19/20

BY

19/20

BY

18/19

Delta

in %

Revenue 779 759 708 697 2,942 3,147 -6.5

EBITDA 90 82 57 72 301 369 -18.4

EBITDA-% 11.6% 10.8% 8.0% 10.4% 10.2% 11.7%

EBIT 45 31 -3 -40 33 202 -83.7

EBIT-% 5.8% 4.1% -0.5% -5.7% 1.1% 6.4%


| |voestalpine AG

» Declining car production over most of BY 2019/20 affectingAutomotive Components business» Structural improvements in US-plant in Cartersville

» Quick recovery of production and sales after COVID lockdown in

China in the 4th quarter

» Complete shutdown of the industry at end of March in Europe,

South Africa and North America

» Mixed picture in Tubes & Sections business» Construction, machinery, material handling, renewable energy

and commercial vehicle segments solid over most of the business

year; passenger car-related business challenging» Precision Strip somewhat lower after excellent past years» Warehouse and Rack Solutions faces additional push from e-

commerce after COVID lockdown on top of already strongdemand over entire BY 2019/20

METAL FORMING DIVISIONBUSINESS DEVELOPMENT BY 2019/20


€mQ1

19/20

Q2

19/20

Q3

19/20

Q4

19/20

BY

19/20

BY

18/19

Delta

in %

Revenue 738 716 667 718 2,838 2,937 -3.4

EBITDA 58 49 32 64 203 213 -4.7

EBITDA-% 7.9% 6.8% 4.8% 9.0% 7.2% 7.3%

EBIT 24 14 -44 15 9 94 -90.6

EBIT-% 3.3% 1.9% -6.6% 2.0% 0.3% 3.2%

| |voestalpine AG

KEY FINANCIALSBY 2019/20


| |voestalpine AG

voestalpine GROUPFINANCIAL OVERVIEW

BY 2018/192018/04/01-2019/03/31

BY 2019/202019/04/01-2020/03/31

Delta%

Revenue 13,561 12,717 -6.2

EBITDA 1,565 1,182 -24.5

EBITDA margin 11.5% 9.3%

EBIT 779 -89 -111.4

EBIT margin 5.7% -0.7 %

Profit before tax 646 -230 -135.7

Profit after tax* 459 -216 -147.2

EPS – earnings per share (euros) 2.31 -1.24 -153.7

In millions of euros

June 2020 Debt Investor Relations18

* Before deduction of non-controlling interests and interest on hybrid capital.

| |voestalpine AG

voestalpine GROUPDEVELOPMENT CASH FLOW

BY 2018/192018/04/01-2019/03/31

BY 2019/202019/04/01-2020/03/31

Cash flow from results 1,304 870

Changes in working capital -137 434

Cash flow from operating activities 1,167 1,304

Cash flow from investing activities -1,020 -716

Free cash flow 147 588

In millions of euros

June 2020 Debt Investor Relations19

| |voestalpine AG

voestalpine GROUPDEVELOPEMENT GEARING RATIO


Figures in millions of euros

June 2020

831635 684

377526

3,572 3,762

3,037

2,7132,586

2,259 2,421

2,978 3,0803,221

2,9953,125

3,775

1,7861,853

2,125

2,5472,882

4,289 4,263

4,262

4,691 4,8365,075 5,262 5,115

5,652

6,060

6,554 6,710

5,615

47%

34% 32%

15% 18%

83% 88%

71%

58%54%

45% 46%

58%55% 53%

46% 47%

67%

2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20

Net Debt (€m) Equity (€m) Gearing ratio (%)

| |voestalpine AG

voestalpine GROUPDEVELOPEMENT NET DEBT / EBITDA

21

831635 684

377526

3,5723,762

3,0372,713

2,586

2,259 2,421

2,978 3,0803,221

2,995 3,125

3,775

517 558

8881,079

1,359

1,837 1,710

1,004

1,606 1,302 1,431 1,3741,530 1,583 1,541

1,954

1,565

1,182

1.6

1.1

0.8

0.3 0.4

1.9 2.2

3.0

1.72.0

1.61.8 1.9 1.9 2.1

1.5

2.0

3.2

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0

2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20

Net Debt (€m) EBITDA Net Debt / EBITDA


Figures in millions of euros

June 2020

| |voestalpine AG

voestalpine GROUPFINANCING PORTFOLIO


The financing strategy of voestalpine focuses on awell balanced financial structure using a broadrange of financing instruments!

The documentation is in line with investmentgrade standards and contains no pledges ofassets or financial covenants.

13%

26%

14%5%

12%

15%

15%

Schuldscheindarlehen

Senior Bonds

Committed Credit Lines (undrawn)

Syndicated Loan

Export Financing Facilities

Bilateral Loan Facilities

Other Financing Facilities

Instrument Volume €m Maturity

Schuldscheindarlehen 693 various

Senior Bonds 1,400 2021, 2024, 2026

Syndicated Loan (RCF) 300 2024

Committed credit lines (undrawn) 780 mainly 2024

Export financing facilities 635 various

Bilateral loan facilities 816 various

Other financing facilities 800 Various

Figures in millions of euros as of 2020/03/31

June 2020

| |voestalpine AG

795

159687

90428

2480

121

780

Liquidity 2020/21 2021/22 2022/23 2023/24 further

voestalpine GROUPLIQUIDITY AND REDEMPTION SCHEDULE

23

1,696

LIQUIDITY REDEMPTION

Figures in millions of euros as of 2020/03/31

Cash

Financial assets

Committed lines

Debt Investor RelationsJune 2020

| |voestalpine AG

voestalpine GROUPOUTLOOK BY 2020/21

June 202024 Investor Relations

» First impacts of COVID-19 already in Q4 of BY 2019/20

» „Lockdown“ currently still in force in many regions of the world

» Final effects not yet assessable, in Q1 BY 2020/21 strong economic

contraction so far

» We are currently assuming a recovery after summer 2020

» The management puts the focus on cost- and working capital management

as well as cash flow generation also in BY 2020/21

» Anticipating a volatile economic environment, we expect for the BY 2020/21

an EBITDA in a range of between EUR 600 million and EUR 1 billion

www.voestalpine.comvoestalpine AG

DEBT INVESTOR RELATIONSGünther PastlT. +43/50304/[email protected]

Daniel HuberT. +43/50304/[email protected]

| |voestalpine AG

voestalpine GROUPDISCLAIMER


These materials do not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer topurchase or subscribe for, any securities, nor shall part, or all, of these materials or their distribution form the basis of,or be relied on in connection with, any contract or investment decision in relation to any securities.

These materials contain forward-looking statements based on the currently held beliefs and assumptions of themanagement of voestalpine AG, which are expressed in good faith and, in their opinion, reasonable. Forward-lookingstatements involve known and unknown risks, uncertainties and other factors, which may cause the actual results,financial condition, performance, or achievements of voestalpine AG, or industry results, to differ materially from theresults, financial condition, performance or achievements expressed or implied by such forward-looking statements.Given these risks, uncertainties and other factors, recipients of this document are cautioned not to place unduereliance on these forward-looking statements. voestalpine AG disclaims any obligation to update these forward-looking statements to reflect future events or developments.

June 2020

debt investor update · 2020. 6. 11. · global market leader in railway infrastructure; european...

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