2q13 - ir presentation

7/27/2019 2Q13 - IR Presentation

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Apresentao Usiminas

2T11 - APIMEC

UsiminasResults

2Q13

Information Classification: Public


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Clique paraeditar o texto

mestre

Usiminas and its

Business Units

OperationalImprovementand Financial

Results

CompanyProfile and

Market Data

Agenda

2


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Aquisition of

J. Mendes ironore mines

Aquisition ofZamprogna

Foundation ofSolues

Usiminas due

to theconsolidation

of thecompanies RioNegro, Dufer,

Fasal andZamprogna,

Usial andUsicort

Single CNPJ:Cosipa is

incorporatedby Usiminas

Foundationof Usiminas

1962-OperationStart Up

PrivatizationUsiminas:1991Cosipa: 1993

Listing onLatibex

Creation ofMineraoUsiminas

Partnershipwith Codemeand Metform

Selling ofTerniumshares

Joint Miningand

Cooperation

Agreementswith MBL and

Ferrous

CommercialAgreementswith MMX to

explore Pau deVinho and to

use theSouthest Port

Negociationwith J. Mendes

concluded

1956

1991

2005

2008

2009

2010

2011 Entrance ofTernium/Tenaris

into UsiminasControl Group

Newshareholdersagreement

signed amongNipponGroup,

Ternium /Tenaris and

UsiminasPension Fund

until 2031

2012

Time Line and Shareholder Composition

3

Sale ofAutomotivaUsiminas *

2013

* Conditioned to CADEs approval (CADE is the Brazilian Antitrust Regulator)


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4

Mining

Steel

Steel processing

Capital Goods

Strategically Located


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Mining

Steel

Steel Processing Capital Goods

UPSTREAM

DOWNSTREAM

Ipatinga

Metform and Codemestake

Cubato

Unigal UsiminasMinerao Usiminas

Solues Usiminas Usiminas Mecnica

Complete Solution of Products and Services

5


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Million tons

32.9

34.7

35.9

42.7

69.3

70.6

76.7

88.6

107.2

708.8

Ukraine

Brazil

Turkey

Germany

South Korea

Russia

India

USA

Japan

China

Source: World Steel Association 6

Capacity

2,090

Production

1,548Consumption

1,409

Excess ofCapacity542

Excess ofProduction

139

World Crude Steel Production in 2012


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3.8 3.9 3.9 3.9

3.63.7

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

3.5 3.53.6

3.4 3.4

3.7

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Flat Steel Brazilian Market

Imports (thousand tons)

7

519

413

512

335 319 323

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Production

InventoriesintheDistributionNetwork

Apparent Consumption

Million tons

Source: IABR / INDA / Usiminas

1.0 1.0 1.00.9

1.01.1

2.8 2.8 2.7 2.6 2.83.1

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

.6

.7

.8

.9

.0

.1

.2

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Million tons Monthly basis


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Usiminas and its

Business Units


Results

Agenda

8

CompanyProfile and

Market Data


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Installed Nominal Capacity : 9.5 million tons / year

Slabs Hot Coils Cold CoilsHeavy PlatesSlab Caster EG HDG

1,950,000tonsOptimizedRolling

Capacity

3,200,000tons1,900,000tons 1,020,000tons350,000tons

Cubato Plant -1,200,000tons -4,400,000tons1,000,000tons4,500,000tons

3,700,000tonsNominalCapacity

8,000,000tons2,000,000tons9,500,000tons 1,050,000tons360,000tons

-

Ipatinga Plant 1,050,000tons360,000tons2,500,000tons3,600,000tons1,000,000tons5,000,000tons

Galvanized

Flat steel production

Steel Business Unit

9


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Auto Industries

Cold Rolled andGalvanized (EG and HDG)

Ship-Building

Heavy Plates

Pipelines

Heavy Plates and Hot

Rolled

Pressure Vessels

Heavy Plates

AgriculturalMachines

Heavy Plates and HotRolled

Civil Construction

Heavy Plates, Hot and ColdRolled and Galvanized (EG

and HDG)

Autoparts

Hot Rolled

HouseholdAppliances

Cold Rolled andGalvanized (EG and

HDG)

Steel Business UnitEveryday steel application

10


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Steel Business UnitCrude steel production Thousand tons

Cubato

Ipatinga

11

1,783 1,858

1,549 1,5091,672

1,845 1,837 1,8041,662

1,749

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13


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31%

18%

6%

9%

35%

Auto IndustryIndustryHousehold AppliancesCivil Construction

Distribution

Sales Breakdown bySegments 2Q13

Sales Thousand tons

12

Steel Business Unit

1,246 1,327 1,262 1,209 1,2261,428

266

561487 522 365

144

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12

Domestic Market Exports


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117

189

83 74100

201

57

20

178

2894%

7%

3% 3%4%

7%

2%1%

7%

10%

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Adjusted EBITDA Adjusted EBITDA Margin

Adjusted EBITDA/ Adjusted EBITDA MarginSteel Business - R$ Million

13

Steel business Adjusted EBITDA is back to 2 digits


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Steel Business Unit

Production capacity of 2.3

million tons per year

Main Applications

Higher product performance and efficiency

Exclusive coils dimensions in Brazil

Higher productivity for customers

High level of automation

Lower electric energy consumption

High-strength steels

14

Hot Strip Mill II - Cubato Galvanizing Line II - Ipatinga

Higher production capacity

Products portfolio increase

Deep drawing steel

Products Inovation

High-strength steels

Excellent flatness

Production capacity of 550

thousand tons per year

Concluded investments


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Located in Serra Azul/MG

4 mining sites, acquired from J. Mendes Group in February 2008

Reserves of 2.6 billion tons of iron ore

Life time until 2045

MRS: 20% of voting shares, being part of the Control Group

Retroarea in Itagua Port

MBL

Arcelor

Mittal

Ferrous

(Santanense)

Com

isa

Emicon

MMX

Ferrous

MUSA

Pau de Vinho

MUSA

Leste

Minerita

MUSA

Central

MUSA

Oeste

Itatiaiuu

Igarap So Joaquim

De Bicas

70.0%

30.0%

Mining - Minerao Usiminas

Minerao Usiminas15


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Production:

Thousand tons

Sales:

16


1,854

1,517

1,785

1,4961,649 1,621

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

1,730

1,497

1,142

1,747

1,346 1,366

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13


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Iron Ore Production Capacity million tons by the end of the year

Friable Project: ongoingEstimated Capex of R$800 million

Compact Project:under detailing phase

Investment Plan

17



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Retroarea in Itagua Port

18


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10 industrial units in MG, SP, RS, ES, BAand PE

Processing capacity of 2 million tons/year

Net Revenue of R$998 million in the 1H13

Steel ProcessingSolues Usiminas and Automotiva Usiminas

19Solues Usiminas

Automotiva

Camaari

Porto Alegre

Campo Limpo Paulista

Guarulhos BonsucessoGuarulhos So Roque

Taubat

Recife

Serra

Betim

Santa Luzia

Solues Usiminas

Automotiva Usiminas

In the 2Q13, Usiminas entered into anAgreement with Aethra Sistemas

Automotivos S.A., for the amount of R$210million (enterprise value) to transfer 100%of its shares. The transaction conclusion isconditioned to the approval of CADE(Brazilian Antitrust Regulator) and is alignedwith the Companys strategy to focus on its

core business, in order to maximize itscompetitive positioning


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Located in Ipatinga/MG, it is one of the

largest capital goods companies in Brazil

Market Segments: Steel Structures,

Shipbuilding and Offshore, Oil and Gas,

Industrial Equipment, Industrial Assembly,

Foundry and Railcars Net Revenue of R$524 million in the 1H13

Usiminas Mecnica

Capital Goods

20

Braslia 3rd Bridge

Ship Panel

20

Platform


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Usiminas and its

Business Units


Results

Agenda

21

CompanyProfile and

Market Data


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Average 2011: 61.6

+10.1%

Increasing Coke ProductionCoke Plant #3 (Ipatinga) Thousand tons

Average 2012/2013:67.8

22

55.3 54.6

60.3 58.861.9

64.167.3 67.5

63.7 63.559.0

63.166.2

62.265.3 65.8

68.5 67.0 68.8 68.0 66.569.2

66.1 68.169.0

61.5

69.867.2 69.3 67.1


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557

583

First Quarter 2012 Last two months 2012

8 CCs6 CCs

+4.7%

1Q12 2Q13

Improving Continuous Casting Productivity

Slab Production

Increasing slabs production Thousand tons

23


24/3324

Adjusted EBITDA - ConsolidatedR$ million

337365

343

218190

232

150

226

313

441

11%12% 12%

8%7% 7%

4%

7%

10%

14%

-10%

-5%

0%

5%

10%

15%

100

150

200

250

300

350

400

450

500

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Adjusted EBITDA Adjusted EBITDA Margin

+41%


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R$2.6 billion Reduction

Reduction of 596 thousand tons in inventories

Working CapitalConsolidated / Steel Business

4.8

2.6 2.7 2.2

Dec/11 Dec/12 Mar/13 Jun/13

1,512

1,031903 916

4Q11 4Q12 1Q13 2Q13

102 54 51 52 Inventory days


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3,070

1,849

985

41

365

555

81

276

112

3,192

2,490

1,652

2010 2011 2012

Steel Mining Others Total

26

- 22%

- 34%

Capex Performance ConsolidatedStrict CAPEX control - R$ million

45

142112

104

17

15

175

261

1Q13 2Q13


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Debt Profile and Cash Position - ConsolidatedR$ million

27

2,804

194948 902 733 1,031

301671

25

1,932

272

411 386 765 2651,108 3

2

Cash 2013 2014 2015 2016 2017 2018 2019 2020 on

Local Currency Foreign Currency

4,736

466

1,3591,498

1,296 1,409

27

674

1,288


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3,410

3,611

3,280

2012 1Q13 2Q13

Net debt

Net Debt - ConsolidatedR$ Million

28

9% net debt reduction, even with a 10% Real devaluation in the 2Q13

-9%


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Quarterly Results Accounted

29

Per Business Unit

Note: All transactions among the business units are made at market price.

R$ million

2Q13 1Q13 2Q13 1Q13 2Q13 1Q13 2Q13 1Q13 2Q13 1Q13 2Q13 1Q13

Net Revenue 223 248 2,898 2,666 639 546 265 259 (780) (524) 3,244 3,195

Domestic Market 191 207 2,683 2,223 634 538 265 259 (780) (524) 2,992 2,703

Exports 33 41 215 442 5 8 0 0 0 0 252 491

COGS (90) (86) (2,707) (2,590) (570) (495) (249) (249) 749 433 (2,868) (2,988)

Gross Profit 133 162 190 75 68 51 16 10 (31) (91) 376 207

Operating Income

(Expenses)(24) (29) (141) (134) (49) (48) (22) (14) 1 1 (234) (224)

EBIT 109 133 50 (58) 19 3 (6) (4) (30) (90) 142 (16)

Adjusted EBITDA 120 144 289 178 33 16 1 2 (1) (27) 441 313

Adj.EBITDA Margin 54% 58% 10% 7% 5% 3% 0% 1% - - 14% 10%

* Unigal 70%

Income Statement per Business Units - Non Audited

ConsolidatedMining Steel*Steel

ProcessingCapital Goods Adjustment


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Results Accounted in the Semester

30

Per Business Unit

Note: All transactions among the business units are made at market price.

R$ million

1H13 1H12 1H13 1H12 1H13 1H12 1H13 1H12 1H13 1H12 1H13 1H12

Net Revenue 471 452 5,563 5,670 1,185 1,029 524 456 (1,305) (1,494) 6,439 6,114

Domestic Market 397 361 4,906 4,582 1,172 1,012 524 454 (1,305) (1,462) 5,696 4,946

Export Market 74 92 657 1,088 13 17 0 2 0 (32) 743 1,168

COGS (176) (173) (5,297) (5,631) (1,066) (943) (499) (483) 1,182 1,387 (5,856) (5,843)

Gross Profit 295 279 266 39 119 87 26 (27) (122) (107) 583 271

Operating Income

(Expenses)(53) (85) (274) (143) (97) (101) (36) (40) 2 4 (458) (365)

EBIT 242 195 (8) (104) 22 (15) (10) (66) (120) (104) 126 (94)

EBITDA 263 211 467 301 49 11 3 (54) (27) (46) 755 422

EBITDA Margin 56% 47% 8% 5% 4% 1% 1% -12% - - 12% 7%

* Unigal 70%

Income Statement per Business Units - Non Audited

Mining Steel*Steel

ProcessingCapital Goods ConsolidatedAdjustment


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Results achieved in the 2Q13

31

Recovery of Consolidated EBITDA margin

Recovery of margins in the Steel Business Unit

Higher steel sales volume in the domestic market

Company financial improvement, with net debt reduction


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Final Message

Costs CAPEX Working Capital

Productivity Increase Industrial Engineering Benchmarking

Operational Efficiency Domestic Sales Increase Leverage ReductionCompanys Profitability

Recovery

Fase I

Control

Fase II

Improvement

Continuous

Process

32


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www.usiminas.com/ri

ADR

Level I

Declarations relative to business perspectives of the Company, operating and

financial results and projections, and references to the growth of the

Company, constitute mere forecasts and were based on Managements

expectations in relation to future performance. These expectations are highly

dependent on market behavior, on Brazils economic situation, on the

industry and on international markets, and are therefore subject to change.

Cristina Morgan C. DrumondHead of IR

[email protected]

Phone: 55-31-3499.8772

Fax: 55-31-3499.9357

Luciana Valadares dos [email protected]

Phone: 55-31-3499.8619

Leonardo Karam [email protected]

Phone: 55-31-3499.8550

Diogo Dias [email protected]

Phone: 55-31-3499.8710

2q13 - ir presentation

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