klöckner & co se - company presentation
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Company presentation
March 2017Company presentation | Klckner & Co SE1
Klckner & Co SE
Duisburg
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Disclaimer
Company presentation | Klckner & Co SE2
This presentation contains forward-looking statements which reflect the current views of the management of Klckner & Co SE with respect to future events. They
generally are designated by the words expect, assume, presume, intend, estimate, strive for, aim for, plan, will, strive, outlook and comparable
expressions and generally contain information that relates to expectations or goals for economic conditions, sales proceeds or other yardsticks for the success of
the enterprise. Forward-looking statements are based on currently valid plans, estimates and expectations. You therefore should view them with caution. Such
statements are subject to risks and factors of uncertainty, most of which are difficult to assess and which generally are outside of the control of Klckner & Co SE.
The relevant factors include the effects of significant strategic and operational initiatives, including the acquisition or disposition of companies. If these or other risks
and factors of uncertainty occur or if the assumptions on which the statements are based turn out to be incorrect, the actual results of Klckner & Co SE can
deviate significantly from those that are expressed or implied in these statements. Klckner & Co SE cannot give any guarantee that the expectations or goals will
be attained. Klckner & Co SE notwithstanding existing obligations under laws pertaining to capital markets rejects any responsibility for updating the forward-
looking statements through taking into consideration new information or future events or other things.
In addition to the key data prepared in accordance with International Financial Reporting Standards, Klckner & Co SE is presenting non-GAAP key data such as
EBITDA, EBIT, Net Working Capital and net financial liabilities that are not a component of the accounting regulations. These key data are to be viewed as
supplementary to, but not as a substitute for data prepared in accordance with International Financial Reporting Standards. Non-GAAP key data are not subject to
IFRS or any other generally applicable accounting regulations. Other companies may base these concepts upon other definitions.
March 2017
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Agenda
March 2017Company presentation | Klckner & Co SE3
1. Klckner & Co SE Overview2. Steel distribution market and positioning of Klckner & Co3. Klckner & Co 2020 strategy
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Klckner & Co SE at a glance
Company presentation | Klckner & Co SE4
01
200,000 PRODUCTS
50SUPPLIERS
6.1 milliontons 5.7 billion 196 million
13COUNTRIES
130,000CUSTOMERS
190LOCATIONS
SHIPMENTSFY 2016
SALESFY 2016
EBITDAFY 2016
9,100EMPLOYEES
March 2017
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Everything from one source
Company presentation | Klckner & Co SE5
01
K L C K N E R & C O V A L U E C H A I N
S U P P L I E R S C U S T O M E R S
March 2017
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Global reach local presence
Company presentation | Klckner & Co SE6
01
Sales; As of December 2016
USA: 37%
D: 27%
F/BE: 10%
CH: 16%
NL: 3%
UK: 5%
ES*: 2%
Europe: 63%
Brazil:
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Solutions for companies of any kind
Company presentation | Klckner & Co SE7
01
S A L E S B Y S E C T O R
In addition to companies in the constructionindustry as well as machinery and mechanicalengineering, we serve customers in the automotive and chemical industry, ship-buildingand in fields of household appliance, consumergoods and energy
As of December 2016
March 2017
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Full range
Company presentation | Klckner & Co SE8
01
Flat products and heavy plates, hollow sections, merchant bars, precision tubes and seamless thick-wall pipes, special profiles, high-alloy round steel bars, stainless steel, aluminum sheets and extrusions, as well as special products for installation, roof and wall construction and water supply, etc.
Tubes
Stainless / Aluminium / Quality steel
Flat products
Long Products
Sales by product
As of December 2016
March 2017
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Extensive services
Company presentation | Klckner & Co SE9
01
Flame/gas/oxygen cutting, autogenous and plasma on CNC and optically controlled machines, burning programs via CAD systems, conservation, cutting and slitting, cutting and bending (routing on demand), cutting to length and sawing (mitercuts), other mechanical processing methods, like drilling, punching, shearing, press breaking, flat rolling, etc.
Furthermore we provide our customers with technical advice, storage facilities and just-in-time delivery
Cutting to Length / Miter Cutting / Bending
Laser cutting / Flame cutting
Decoiling / Cutting / Slitting
Surface treatment
March 2017
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Current shareholder structure
Company presentation | Klckner & Co SE10
01
Geographical breakdown of identified institutional investors
As of February 2017
Shareholder structure of Klckner & Co SE
5%Other investors
17%Private investors
78%Identified institutional
investors
6% Rest of EU
36% US
3% Rest of world
2% Switzerland
5% UK
48% Germany
March 2017
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Management
Company presentation | Klckner & Co SE11
01
W i l l i a m A . P a r t a l i sMember of the Board
North American Operations South American Operations
G i s b e r t R h lCEO
Corporate Development*) / M&A
Legal & Compliance Investor Relations &
Corporate Communications Group HR
*) incl. kloeckner.i GmbH und kloeckner.v GmbH
M a r c u s A . K e t t e rCFO
Corporate Accounting Corporate Controlling Corporate IT*) Corporate Taxes Corporate Treasury Internal Audit
*) incl. Klckner Shared Services GmbH
K a r s t e n L o r kMember of the Board
European Operations*)
*) incl. Kloeckner Metals Europe GmbH
March 2017
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Agenda
Company presentation | Klckner & Co SE12
1. Klckner & Co SE Overview2. Steel distribution market and positioning of Klckner & Co3. Klckner & Co 2020 strategy
March 2017
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Current situation
Company presentation | Klckner & Co SE13
02
Source: Bank of America Merrill Lynch, own estimates; in million tons.
March 2017
NAFTA Steel demand (million to)
EU-28 Steel demand (million to)
Source: Worldsteel
Overcapacity of steel by region (2016)
NAFTA~30
South-america
~25
Europe~90
India~20
CIS~30
Japan~20
China~280
Others:~115World:~610
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Europe vs. US
Company presentation | Klckner & Co SE14
02
Steel producers Steel producers
End user End user
Source: WSA, MSCI, Eurometal, SBB
40%
Larger independent distributors /
SSC
Small / midsize
distributors / SSC
Producerowned
distributors / SSC
60% 60%
Larger independent distributors /
SSC
Small / midsize
distributors / SSC
40%
25% 15%
Europe US
March 2017
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Market shares of Klckner & Co
Company presentation | Klckner & Co SE15
02 Position in the US significantly improved whereas market share in Europe remained stable despite heavy
restructuring measures
1%
RelianceRyersonTKSamuelO'NealRusselMacsteelMetals USAPNANamascoOthers
Europe
US
2007 2016
5%Arcelor MittalThyssenKruppKCOSalzgitterTataOthers
5%Arcelor MittalThyssenKruppKCOSalzgitterTataOthers
4%RelianceRyersonKloecknerMetalsThyssenKruppOthers
ThyssenKrupp
~3,000
~1,200
Source: Eurometal, Purchasing Magazine, Service Center News
March 2017
Diagramm1
0.05
0.04
0.02
0.02
0.02
0.02
0.01
0.01
0.01
0.01
0.79
Tabelle1
2011US2011Europe
Reliance10%AMDS10%
Ryerson6%TK6%
Kloeckner Metals4%KCO6%
TK3%Salzgitter4%
Others77%Tata4%
Others80%
20072007Europe
Reliance5%TK6%
Ryerson4%KCO6%
TK2%AMDS10%
Samuel2%Salzgitter4%
O'Neal2%Tata4%
Russel2%Others70%
Macsteel1%
Metals USA1%
PNA1%
Namasco1%
Others79.00%
Tabelle1
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Agenda
Company presentation | Klckner & Co SE16
1. Klckner & Co SE Overview2. Steel distribution market and positioning of Klckner & Co3. Klckner & Co 2020 strategy
March 2017
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Our strategy
Company presentation | Klckner & Co SE17
03
G R O W T H A N D O P T I M I Z A T I O N
D I F F E R E N T I A T I O N
D I G I T A L I Z A T I O N
K L C K N E R & C O 2 0 2 0
P R O D U C T S A N D S E R V I C E S
O P E R A T I O N S
E X T E R N A L & I N T E R N A L G R O W T H
Digitalization of the supply chain and development of a industry platform
Accelerated expansion of higher value-added products and services
One Europe and further optimization
External growth with focus on higher value-added business, internal growth with focus on the US market
March 2017
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Steel supply chain is highly inefficient and totally intransparent
Company presentation | Klckner & Co SE18
03
S U P P L I E R S C U S T O M E R S
N O E F F E C T I V E I N F O R M A T I O N A N D D A T A E X C H A N G E O N A V A I L A B L E I N V E N T O R Y , L E A D T I M E S E T C .
L O N G D E L I V E R Y T I M E S , I N C O R R E C T D E L I V E R I E S A N D H I G H I N V E N T O R Y L E V E L S
Other DistributorsKlckner & Co
S T O C K H O L D I N G
Inefficiencies are through stockholding
Earnings are based to a certain extend on intransparencyNo sustainable business model
March 2017
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S U P P L I E R S C U S T O M E R SAggregated Demandinformation
POS Data / Analytics
Application Programming Interface
Cumulativequantities
I N D U S T R YP L A T F O R M
Aggregated Supply
information
Other DistributorsKlckner & Co
S T O C K H O L D I N G
3 R D P A R T Y S A L E S - /S E R V I C E - / I O T P L A T F O R M S
Industry 4.0 and others
Goal is the transformation of a classic value-chain into a platform business
Company presentation | Klckner & Co SE19
03
March 2017
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A digital platform provides advantages for all participants
Company presentation | Klckner & Co SE20
03
March 2017
Suppliers Insufficient utilization of production assets
Customers
Stockholders
Intransparent pricing availability of goods and processes
Inefficient stock-keeping and high inventories in order to provide product availability towards customers
Aggregation and early notification of demand allows optimized production and utilization of asset-intensive production assets
Broad material availability reduces order-to-cash cycle time and higher price transparency allows improved purchasing
Optimized logistics, predictive sales and real-time visibility reduce lead times and accordingly inventories
I N D U S T R YP L A T F O R M
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Digital transformation takes place in 3 steps
Company presentation | Klckner & Co SE21
03
March 2017
Value
Cultural change
Time
Industry platform Open for selected 3rd party
sellers/distributors in 2017 Fully open marketplace with price
comparison on complementary products
Service platform
Digital tools Contract portals Onlineshops Order transparency tools Others
Kloeckner Connect as centralaccess point for customers to make use of various digital toolsand services
Progress
1
2
3
Launch of quick winsIntegration of most promising tools and
upscalingEnabling of further opportunities
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Higher value-added strategy further advanced
Company presentation | Klckner & Co SE22
03 Sales share of higher value-add products and services up from 39% in 2015 to 46% in 2016
Further increase of higher margin business to a sales share of more than 50% planned by 2018
18% Higher value-add
products
28%Higher value-add
services
31% Standard products
23% Conventional
services
A C T U A L 2 0 1 6
>20%
>30%
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Contact
Company presentation | Klckner & Co SE23
Christian PokroppSpokesperson
Tel: 0203-307-2050Fax: 0203-301-5025Email: christian.pokropp@kloeckner.com
March 2017
Company presentationDisclaimerAgendaKlckner & Co SE at a glanceEverything from one sourceGlobal reach local presenceSolutions for companies of any kindFull rangeExtensive servicesCurrent shareholder structureManagementAgendaCurrent situationEurope vs. USMarket shares of Klckner & CoAgendaOur strategySteel supply chain is highly inefficient and totally intransparentGoal is the transformation of a classic value-chain into a platform businessA digital platform provides advantages for all participantsDigital transformation takes place in 3 stepsHigher value-added strategy further advanced Contact
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