Results as of 30 September 2016 - Acerinox

Acerinox | Results as of 30 September 2016

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Results as of 30 September 2016

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Presentation of the results for the third quarter of 2016 via webcast and Conference call

Ac eri no x w i ll hol d a pre se ntat io n f or t he r esu lt s o f t he t hir d q uart er o f 2 016 , i n Eng li sh, on 26 Oc tob er, at 11 . 00 am C ET, c ond uct ed by t he Man age men t T eam and acc omp an ied by th e I nv est or R el ati on s t eam .

To A c ces s t he p res ent at i on v ia co nfer enc e c al l y ou c an u se one of the fol lo wi ng numb ers 5 - 1 0 m inu te s b ef ore t he ev ent be gi ns:

Ca ll s fr om the U nit ed K in g dom: +4 4 (0) 20 314 746 00 Ca ll s fr om the U nit ed S tat es: +1 866 30 591 04 Ca ll s fr om Sp ai n a nd the r est of th e worl d: +34 91 79 0086 3

The pre se nta tio n w il l ta k e p la ce a t the Ho tel Int e rcon tin ent al in Ma dri d, a nd ca n be fol lo wed on th e A cer ino x web si te ( w ww .a ceri no x .com ), in the Sha reh old ers and Inv est ors s ect io n.

The pr es ent at ion and a ll the aud io - vi sua l m ate ria l wi ll be av ai lab le on the Ac eri no x web si te.

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Results as of 30 September 2016 

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Ac eri no x o bta in s a pr ofi t for t he qu arter , a ft er t ax e s a nd min ori ty in ter est s , of 3 6 mil li on e uro s ( co mpar ed t o lo sse s of 8 mi ll io n euro s in t he t hir d qua rter o f 2 015 ). The a cc umu lat ed r esu lt fo r the fir st n in e mo nth s, a moun tin g t o 45 m i ll ion eu ros, is sti ll 20 % l ow er t han th at o f th e pr ev io us ye ar . The E BI T D A for th e th ird quart er, 10 3 m il l ion eur os , i s 149 % h igh er in c omp aris o n wi th t he s ame per iod in 2015 . As o f Sep tem ber it amou nts to 2 23 m il li on euro s, wh ich is st il l 9 % l ow er th an it wa s c omp ared to t h e per iod b et wee n J anu ar y and Se pte mber 20 15 The E BIT D A m arg in for th e th ird qua rter , 1 0.3 %, h a s gr adu al ly imp rov ed thro ugho ut the ye ar a nd is th e b es t s i nce th e t hir d q uart er o f 2 0 14 The Gr ou p’ s a ccu mu lat ed turn ove r of 2,9 15 mi ll ion euro s i s 1 2 % l ow er t han it was duri ng th e sam e peri od of th e prev io us y ear , d es pit e s al es of p hy si ca l uni ts hav ing incr ea sed b y 8 % Melt in g p ro d uct io n h as i ncre ase d by 5 % in c omp aris on w ith t he per iod b etw een Jan uary a nd Se pte mber 2 015 Net fi nan ci al d ebt amo unt s to 678 mi ll ion euro s, 14 % l o wer t han tha t of S ept ember of t he pre vi ous y ear The t ota l ca sh fl ow ge n erate d f rom op erat in g a c tiv it ie s, 154 mi ll io n e uro s, has all ow ed ma ki ng pa yme nts for in ve stme nt s of 97 mi ll i on euro s, c ash d iv id end s of 27 mil li on euro s and to red u c e ne t d ebt b y 3 3 m il li on eu ros In Ju ly , Ac erin ox di str ib uted 0.4 4 eur os p er s h are thr oug h a scr ip d iv i dend . Sh areh ol ders re pre sen tin g 77 % of sh are ca pit al c hos e to ta ke on ne w sha res Onc e th e fu nda men ta l pa ramet ers of t he s ec tor h ave sta bi li sed , th e C omp any is opt imi st ic for th e f ol lo wi ng quar ter s

Results after taxes and minority interests Millions of euros

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Stainless Steel Market Wor ld wi de pro du ct ion o f s tai nle ss ste el incr ea sed b y 4.1 % i n th e fir st h al f of the y ear, acc ord ing to th e lat est I S S F fi gure s.

Source: ISSF

Pro du cti on ha s d ecr eas ed in E urop e a nd A mer ica d ue t o i nv ent ory ad ju stm en ts and th e redu cti on of c apa ci ty on the se m arke ts . We s ho uld al so h igh l igh t th e in crea se in produ ct ion o f Chi na, du e t o th e incr ea se in lo ca l con sump ti on and e xpor ts . The t hir d qu arte r of 201 6 has bee n ma rke d b y t he st rengt h o f de man d, the st a bil is at ion of ni ck el pri ces and th e end o f i nve ntor y a dj ustm ent s. A ll t he se fa ct ors ha ve comp en sat ed the tra di ti on al r edu ct ion of de li ver ie s duri ng the th ird qu arter .

Official price of nickel on the LME From 2006 to September 2016

Source: LME

The pri ce of n ic ke l con tin u es at it s lo we st v alu e si nc e 2 008 . T he r ec ent a nno u ncem ent s of t he c los ure of ni c kel mine s in th e Ph il ip pin es , for env iro nme nta l r eas on s , an d the decr eas e in in ven tor ie s, a ppear to mar k an up ward t rend for th e n ext fe w mon t hs.

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Official price of nickel on the LME 2015 and 2016 (up to 30 September)

Europe Ac cor di ng to our est im at es, ap pare nt con su mpt ion of fla t p rod uct s has i ncr eas ed by 8.1 % a s of Sep tem ber, comp are d to th e sa me p erio d in 2 015 , part ly du e t o the repl eni sh men t o f s to ck s i n th e sup pl y c ha in to me et t he nee ds of in cre as e d a cti vi ty . Ne vert hel es s, we c on si der it to be l ow er th an t he a vera ge o f the la st t hree y ears . W e hig hl igh t th e p os it ive pe rforma nc e o f It al y (+ 16. 7 %) , Fr anc e (+ 9.1 %) an d P ol and (+15. 5 %) wh erea s onl y the Un it ed K ing dom pre se nts nega ti ve ev olu ti on ( - 10 .3 %) . De spi te an ti dum pin g mea s ures a ga ins t Ch in a and T ai wan , the m arke t sh are o f impo rts has rem ain ed st abl e, as h a ve ba se pri ce s. The m ain pro duc ti on se ct ors con tin ue to b e t hos e r ela tin g t o c ons umer go ods , su ch as auto mot iv e and hou se hol d e le ctr ic al a ppl ia nc es, o f wh ich by t he en d of t he y ear ar e exp ect ed to in cre ase b y 5 . 5 % an d 2 .8 % re spe ct ive ly .

United States Page 4 / 10


Dem and i s al so gro wi ng in t he Un it ed S tat es d ue to in crea se s of 4. 9 % in t he con stru ct io n in du str y, 1 .7 % i n t he a ut omot iv e i nd ustr y a nd 1 .5 % in t he h ous eho ld ele ctr ic al

ap pl ian ce s

in dus try.

Ho wev er,

a ccor din g

to

our

es tim ate s,

app are nt

con sum pt ion d e crea se d b y 0.8 % up to J ul y d ue to th e red uc tio n of sto ck s. Impor ts of f lat prod uc ts h ave d ecr ea sed by 2 3 % up to Ju ly due to t he a nno u ncem ent s on prel im ina ry an ti sub si dy an d a nt idu mpi ng mea sur e s. On 12 th Ju ly , the U ni te d Sta te s Dep artm ent of C omm erc e ann o un ce d pr el im inar y ant isu bs id y m eas ure s o f bet we en 57.3 0 % a nd 1 93. 12 % a g ain st Ch ina . O n 13 th Se ptem ber p rel im inar y d uti e s ran gi ng bet wee n 6 3.8 6 % and 76 . 64 % aga in st the c old ro l led fl at pro duc ts fro m C hin a were anno un ced . Inv ent orie s are b el ow t he a vera ge f or r ece nt y ear s a lth oug h the y ha ve i ncr e ase d ove r the la st fe w m ont hs . The thr ee pr ic e in cre as es an nou nc ed i n th e fi rst - h al f ha ve be en con s oli dat ed, reco ver ing a goo d p art of wha t wa s l os t l as t y ear .

Asia The co ns umpt io n se cto rs in C hin a are e vo lv ing sat i sfa ctor il y. Car pr odu ct ion gre w b y 13.4 % u p to Se pte mbe r, c on stru ct ion b y 5. 4 % u p t o Aug ust , al tho ugh h ous eho ld ele ctr ic al ap pl ian ce s fe ll b y 0.8 % u p to Au gus t, acc ord ing t o in du stry fig ures . T he gros s d ome st ic pro du ct ( GD P) in cre as ed by 6.7 %, and the In du str ial Prod uc t ion In dex by 6.0 %. Ho we ver, Chi na s ti ll s ho ws s ig ns of e x ces s ca pa cit y, whi ch f orc es th em t o loo k for other mar ke ts dem on stra ti ng t hat e xpor ts ha ve in cre ase d b y 2 0 % up to Au gu st . Foll ow in g t he mea sur es im pos ed by Euro pe an d th e Un ite d S t ate s, ex port s ar e prim ari ly mad e t o o ther A sia n c ou ntri es , t here fore comp et it ion in th e ar ea is hig h a nd pric es c ont inu e t o re ma in very l ow . Ac cor di ng to off ic ia l da ta publ is hed in Wu xi a nd F osh an, m aj or Ch in es e wa rehou se s, inv ent ori es ha ve r ea che d t he a ver age of th e las t f ew ye ars.

Production Page 5 / 10


Ac eri no x’ s mel ti ng pr odu c tio n, 1, 864 ,28 6 ton ne s, i s 5. 1 % h igh er tha n in t he firs t ni ne mont hs of th e pr ev iou s ye ar.

Quarterly melting production Thousands of Mt

Hot- r ol le d pr odu ct ion , 1 ,6 61,7 66 ton ne s, is 6. 7 % h i gher tha n in the sa me per iod of th e prev iou s ye ar.

On t he o ther ha nd, co ld - r oll ed p rod uct io n, 1 ,27 5,1 0 0 ton ne s, h as in crea se d b y 4. 6 % i n comp ari so n wit h t he fir st n ine mon th s o f 2 015 . Sa le s o f phy si ca l un its h ave i ncre as ed by 8. 2 % d ue t o the re duc ti on of th e Gr oup ’s inv ent ori es .

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Results The Grou p’ s n et sa le s o f 2,9 15 mi ll ion eur os fro m Ja nuar y t o Se pte mber a re 12 .1 % lo wer t han dur in g th e s am e per iod of the pre vi ou s y ear, due to the lo wer pri c es in a ll mark ets ( Eu rop e - 15 %, Un ite d S tat es - 2 5 % and As ia - 1 8 %), m ai nl y ca us ed by t he dec li ne in ra w ma ter ia l pr i ces . Condensed profit and loss account Millions of euros

The E BIT D A for th e th ird quart er a mou nts to 103 m il lio n eu ros , 14 9 % h ig her than tha t of th e pre vi ous yea r. We emph as is e the impr ov eme nt in the E BIT D A mar gi n sin ce t he beg inn ing of th e ye ar, whi ch i ncre as ed fr om 4. 3 % to 10 .3 % i n th e th ird q uart e r , and is the be st si nce th e t hir d q u arter of 20 14 . The re sul ts a fte r ta xes a nd mi nor ity int ere st s am ount to 45 m i ll ion e uro s, a f ig ure 20.4 % l ow er t ha n tha t f or Jan uar y t o Sep tem ber 20 15, alt hou gh hi gher th an t he who le of th e pre vi ous tax ye ar. T he res ul t aft er ta xe s a nd mi nor ity in tere st s for the t hird quart er sta nd s a t 3 6 m il li o n eur os . The Gro up ’s n et f ina nc ial de bt a s of 3 0 S ept emb er s tan ds a t 678 m il li on e u ros, 1 4 % lo wer tha n t hat of S ept e mber 201 5. A cer ino x m ai nta ins cr e di t lin es i n fo r ce f or an amou nt of 1,8 9 5 m i ll ion eu ros, of w hi ch 32 % is a va il abl e. In May , the Grou p pro cee ded to re fi nan ce th e bu lk of t he de bt for a n amo u nt of 71 7 mil li on eur os . W ith th e n ew co ntr act s, ma tur it ies were e xt end ed un ti l 202 1 , a ver age int e res ts wer e red uc ed, p ayme nt s for the n ex t thr e e yea rs were al so mo der ated and new ent it ies wer e ad ded to th e ban ki ng p ool . Al l thi s ha s en abl ed t he C o mpan y to obta in fav our abl e f ina nc i ng c ond it ion s an d to red uce the co st o f th e de b t wi th out cov ena nt s.

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Balance sheet summary Millions of euros ASSETS

LIABILITIES Sep 16

2015

Sep 15

Variation

Sep 16

2015

Sep 15

Variation

Non-current assets

2,262.99

2,317.53

2,310.72

-2.4%

Equity

1,990.54

2,023.30

2,002.90

-1.6%

Current assets

2,034.38

1,808.14

2,002.21

12.5%

Non-current liabilities

1,232.10

995.59

1,067.55

23.8%

855.77 548.98 519.23 29.74 629.64

824.93 478.85 439.54 39.31 504.36

885.61 576.65 543.33 33.32 539.95

3.7% 14.6% 18.1% -24.3% 24.8%

991.50 240.60

741.16 254.43

810.88 256.67

33.8% -5.4%

1,074.72

1,106.77

1,242.47

-2.9%

292.70 682.17 99.85

449.54 566.28 90.96

475.59 670.81 96.07

-34.9% 20.5% 9.8%

4,297.37

4,125.67

4,312.93

4.2%

4,297.37

4,125.67

4,312.93

4.2%

- Inventories - Debtors Trade debtors Other debtors - Cash and other current assets

TOTAL ASSETS

- Interest-bearing loans and borrowings - Other non-current liabilities

Current liabilities - Interest-bearing loans and borrowings - Trade creditors - Other current liabilities TOTAL EQUITY AND LIABILITIES

The t ota l ca sh flo w gen er ated fro m o pera ti ng act iv it ies , 1 54 mi ll ion eur os , h a s a ll ow ed mak ing pay men ts f or i nv est m ent s o f 97 m il li on e uros , ca sh di vid end s o f 27 mi ll io n euro s a nd to r edu ce ne t d ebt by 33 mi ll io n e uro s.

Condensed cash flow statement Millions of euros

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Shareholder Remuneration The O rdi nar y G ener al S ha reho lder s’ Me eti ng hel d o n 9 Jun e 20 16 ado pte d th e fl ex ib le div id end for mul a (a ls o c a lle d s cr ip d i vid end) , in w hic h t he shar eh old ers of Ac eri no x were ab le to d ec ide be tw e en re ce iv ing ca sh ( 0.4 40 euro s/s har e), new s hare s or se ll in g the ir r igh ts ov er shar es on the s toc k ex cha nge . On 2 2 Ju ly 20 16, 9,3 60, 1 50 ne w shar es wer e re le ase d on the Madr id and B ar ce lon a St oc k E xch ang e thro ugh the C ont inu ou s M ark et. T he num ber of s hare s of Ac eri no x, S. A. i s curr ent ly 27 6,0 67, 543. We be li eve th at it i s i mpo rtant to em pha si se th e g o od re sp ons e t ha t t hi s me a sure ha s onc e ag ain had . Shar eho l ders r epre se nt ing 77 % o f s har e ca pi ta l ch os e to r e cei ve the div id end in ne w sh are s.

Outlook As we an nou nce d in J ul y, on ce th e goo d f un dame n tal s of th e sec tor an d sp eci fi ca ll y the pri ce of ni ck el st ab il is ed, the Gr oup ’s re su lts s ta rted to im pro ve. Pru den ce i n al l mar ket s d ue to th e com pl ex it y of th e e co nom ic an d po li ti cal sit uat io n wi ll ca use an ad jus tme nt in e nd of year de li ver ie s. Ne vert hel es s, our ord ers b oo k con tin ue s t o b e s tro ng and is 27 % h igh er t han th at of S ept emb er 2 015 . Und er t he se cir cum st anc e s, A ceri no x’ s re su lt s wi ll r emai n p os it ive fo r th e f in a l qu art er and th is w il l m ake i t p os si ble for th e t ota l of the ye a r to ex cee d the res ul ts for 201 5. We are c onf id ent th at de mand w il l pi ck up i n t he fir st qu arter o f 2 017 a ll ow ing an incr ea se in ba se pri ce s.

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Main economic-financial magnitudes Year 2016

CONSOLIDATED GROUP

Q1

Q2

Q3

2015

Q4

Accumulated

Jan-Sep

0 0 0 0

1,864,286 1,661,766 1,275,100 172,250

1,773,926 1,557,953 1,218,667 168,330

0.00

2,914.64

3,316.08

0.00

223.03

245.13

Production (Mt.) Melting shop Hot rolling shop Cold rolling shop Long product (hot rolling)

575,051 651,881 637,355 526,397 563,425 571,944 418,064 428,076 428,960 54,754 63,795 53,700

Net sales (million €)

953.35

Gross operating result / EBITDA (million €)

40.99

953.67 1,007.62

78.75

103.30

4.3%

8.3%

10.3%

7.7%

7.4%

0.55

35.89

60.20

96.64

121.35

0.1%

3.8%

6.0%

3.3%

3.7%

-7.35

26.43

53.50

0.00

72.58

86.27

Result after taxes and minorities (million €)

-8.31

16.99

35.82

0.00

44.50

55.88

Depreciation (million €)

40.20

42.73

42.70

0.00

125.63

122.45

Net cash flow (million €)

31.89

59.72

78.53

0.00

170.13

178.33

Number of empoyees

6,502

6,625

6,541

0

6,541

6,491

Net financial debt (million €)

693.41

608.88

678.07

0.00

678.07

788.10

Debt to equity (%)

36.2%

31.1%

34.1%

0.0%

34.1%

39.3%

Number of shares (million)

266.71

266.71

276.07

0.00

276.07

266.71

% over sales EBIT (million €) % over sales Result before taxes and minorities (million €)

Return to shareholders (per share)

0.0%

---

---

0.44

---

0.44

0.449

Daily average shares traded (nº of shares, million)

2.84

1.72

1.31

0.00

1.94

1.94

Result after taxes and minorities per share

-0.03

0.06

0.13

0.00

0.16

0.21

Net cash flow per share

0.12

0.22

0.28

0.00

0.62

0.67

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