3q13 - ir presentation
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Apresentação Usiminas
2T11 - APIMEC
3Q13 Results
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 ofJ. Mendes
iron oremines
Aquisition ofZamprogna
Foundationof Soluções
Usiminas dueto the
consolidationof the
companiesRio
Negro, Dufer, Fasal andZamprogna,
Usial andUsicort
Single CNPJ:Cosipa is
incorporatedby Usiminas
Foundationof Usiminas
1962-OperationStart Up
Privatizationof
Usiminas:1991
Cosipa: 1993
Listing onBOVESPA
Listing onLatibex
Creation ofMineraçãoUsiminas
Partnership
with Codemeand Metform
Selling ofTerniumshares
Joint Miningand
CooperationAgreements
with MBL andFerrous
CommercialAgreementswith MMX toexplore Paude Vinho and
to use theSouthest Port
Negociationwith J.Mendes
concluded
1956
1991
2005
2008
2009
20102011 Entrance of
Ternium/Tenaris
intoUsiminas’
ControlGroup
Newshareholders
agreementsigned among
NipponGroup,
Ternium /Tenaris and
UsiminasPension Fund
until 2031
2012
Time Line and Shareholder Composition
3
Sale ofAutomotivaUsiminas *
2013
Listing onADR I - NY
* Conditioned to CADE’s approval (CADE is the Brazilian Antitrust Regulator)
1994
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4
Mining
Steel
Steel processing
Capital Goods
Strategically Located
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Mining
Steel
Steel Processing Capital Goods
U P S T R E A M
D O W N S T R E A M
Ipatinga Metform and Codemestake
Cubatão
Unigal UsiminasMineração Usiminas
Soluções Usiminas Usiminas Mecânica
Complete Solution of Products and Services
5
Automotiva Usiminas
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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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Flat Steel Brazilian Market
Imports (thousand tons)
7
Production (million tons)
Inventories in the Distribution Network
Apparent Consumption (million tons)
Source: IABR / INDA / Usiminas
3.5 3.53.6
3.4 3.4
3.7
4.0
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
3.8
3.9 3.9 3.9
3.6
3.8 3.8
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
519413
512
335 319 323
607
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
2.8 2.8 2.7 2.6 2.8 3.1
2.7
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
Million tons Monthly Basis
1.0 1.0 1.0 0.9 1.0 1.1 1.1
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Usiminas and its
Business Units
OperationalImprovementand Financial
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
2,200,000tonsOptimizedRolling
Capacity
4,200,000tons1,900,000tons 1,020,000tons350,000tons
Cubatão 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
Cubatão
Ipatinga
11
1,7831,858
1,549 1,509
1,672
1,845 1,837 1,8041,662
1,749 1,782
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
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Sales Breakdown bySegments – 3Q13
Sales – Thousand tons
12
Steel Business Unit
33%
15%7%
10%
36%Auto Industry
Industry in general
Household Appliances
Civil Construction
Distribution
1,246 1,327 1,262 1,209 1,226 1,428 1,453
266
561487 522 365
144 1121,512
1,8881,749
1,731 1,591 1,572 1,565
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
Exports Domestic Market
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Steel BusinessAdjusted EBITDA / adjusted EBITDA Margin – R$ million
13
117
189
83 74 100
201
57 20
178
289
376
4%
7%
3% 3%4%
7%
2%
1%
7%
10%
13%
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
Adjusted EBITDA Adjusted EBITDA Margin
13
The highest EBITDA and EBITDA margin in the Steel Business in the last 3 years
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Steel Business Unit
Production capacity of 2.3million tons per year
Main Applications
Exclusive coils dimensions in Brazil
Pickled Coils up to 1,800 mm wide
Higher product performance and efficiency
Higher productivity for customers
High automation and lower electric energy consumption
High-strength and technology content to the steel products
Hot Strip Mill II and NewPickling Line - Cubatão
Galvanizing Line II - Ipatinga
Higher production capacity
Products portfolio increase
Deep drawing steel
Products Inovation
High-strength steels
Excellent flatness
Production capacity of 550thousand 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 Itaguaí Port
MBL
Arcelor
Mittal
Ferrous
(Santanense)
Com
isa
Emicon
MMX
Ferrous
MUSA
Pau de Vinho
MUSA
Leste
Minerita
MUSA
Central
MUSA
Oeste
Itatiaiuçu
Igarapé São Joaquim
De Bicas
70.0%
30.0%
Mining - Mineração Usiminas
Mineração Usiminas15
Description
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Production - Thousand tons
16
Mining - Mineração Usiminas
1,854
1,517
1,785
1,496
1,649 1,621
1,213
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
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Sales – Thousand tons
Mining - Mineração Usiminas
17
The Mining sales volume presented a strong growthdue to the increase in the domestic sales - Historical record
1,251 1,072
771
1,237 1,133994 1,043
322
60
47
1748
206
787
156
365
324
493
165 166
1,729
1,497
1,142
1,747
1,346 1,366
1,830
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
Sales to Usiminas Sales to 3rd parties - DM Exports Total
+34%
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Adjusted EBITDA / adjusted EBITDA Margin – R$ million
Mining - Mineração Usiminas
139
180
156 129111 100
56
173
144119
139
65% 68%
61%
54%
46% 47%
36%
59% 58%53%
49%
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
Adjusted EBITDA Adjusted EBITDA Margin 18
The Mining EBITDA margin remained at a high leveleven with the higher sales volume in the domestic market
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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
19
Mining - Mineração Usiminas
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Retroarea in Itaguaí Port
20
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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$1,573 million until
September 2013
Steel ProcessingSoluções Usiminas and Automotiva Usiminas
21Soluções Usiminas
Automotiva
Camaçari
Porto Alegre
Campo Limpo Paulista
Guarulhos BonsucessoGuarulhos São Roque
Taubaté
Recife
Serra
Betim
Santa Luzia
Soluções Usiminas
Automotiva Usiminas
In the 2Q13, Usiminas entered into an Agreement withAethra Sistemas Automotivos S.A., for the amount of R$210million (enterprise value) to transfer 100% of its
shares, aligned with Usiminas
strategy to focus on its corebusiness and maximize its competitive positioning.
On 10/23/13, it was published on Diário Oficial da União(Brazilian Federal Register) that such transaction wasapproved by CADE (Brazilian Antitrust Regulator) withoutany restriction. The transaction conclusion is subjected to
certain conditions precedent.
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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$770 million until September 2013
Usiminas Mecânica
Capital Goods
22
Brasília 3rd Bridge
22
Oil Platform
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Usiminas and its
Business Units
OperationalImprovementand Financial
Results
Agenda
23
CompanyProfile and
Market Data
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Increasing Coke ProductionCoke Plant #3 (Ipatinga) – Thousand tons
24
55,3 54,6
60,3 58,861,9 64,1
67,3 67,5
63,7 63,559,0
63,166,2
62,2 65,3 65,8
68,5 67,0 68,8 68,0 66,5 69,2
66,1 68,1 69,0
61,5
69,867,2
69,367,1
69,3 69,8 67,1
Average 2011: 61.6+9.1%
Average 2012/2013:67.2
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Improving Continuous Casting Productivity (CC)
Slab Production
Increasing slab production – Thousand tons
25
557
594
1Q12 3Q13
+6,6%
8 CCs
6 CCs
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Gross Profit, EBIT and Net ProfitConsolidated - R$ million
26
In the 3Q13, the net profit reached R$115 million
376
455
142
226
-22
115
2Q13 3Q13
Gross Profit
EBIT
Net Income
+R$84 Mi
+R$137 Mi
+R$79 Mi
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Adjusted EBITDA and adjusted EBITDA MarginConsolidated - R$ million
337 365 343
218190
232
150
226
313
441
538
11%
12%
12%
8%
7% 7%
4%
7%
10%
14%
17%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
110
210
310
410
510
610
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13
Adjusted EBITDA Adjusted EBITDA Margin
The highest EBITDA and EBITDA margin in the last 3 years
+22%
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Working CapitalConsolidated – Focus on Working Capital control
4.8
2.6 2.72.2
2.8
Dec/11 Dec/12 Mar/13 Jun/13 Sep/13
Average2.6
R$ billion
1,512
1,031903 916
1,028
4Q11 4Q12 1Q13 2Q13 3Q13
102 54 51 52 Inventory days59
R$ million
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Capex EvolutionConsolidated- R$ million
45
142 172
359
112
104 56
272
175
261435
673
1Q13 2Q13 3Q13 9M13
Capital Goods
Steel Processing
Mining
Steel
Strict CAPEX control
Total
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Debt Profile and Cash PositionConsolidated - R$ million
30
2,201
158
730905
735982
301
671
26
1,788
82
394389 758 266
1,1003
2
Cash 2013 2014 2015 2016 2017 2018 2019 2020 on
Local Currency Foreign Currency
3,990
239
1,124
1,493
1,2481,401
28
673
1,293
Duration: R$: 45 monthsUS$: 44 months
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Net DebtConsolidated - R$ million
31
The strong financial position allowed a better cashmanagement through voluntary debt prepayment
3,410
3,611
3,280
3,509
4.44.0
2.92.3
4Q12 1Q13 2Q13 3Q13
Net debt Net debt / Adjusted EBITDA (x)
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Results achieved in the 3Q13
32
Historical Record of sales in the Minning Segment
Highest steel sales volume in the domestic market in 5 years
Highest EBITDA and EBITDA Margin in the Steel Sector in 3 years
Highest EBITDA and EBITDA Margin on a Consolidated basis in 3 years
Strong financial position with substancial reduction in the leverage ratio
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Final Message
Costs CAPEX
Working Capital
Productivity Increase Industrial Engineering
Benchmarking Operational Efficiency Domestic Sales Increase Leverage Reduction
Company’s Profitability
Recovery
Fase I
Control
Fase II
Improvement
Continuous
Process
33
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Quarterly Results Accounted
34
Per Business Unit
Note: All intercompany transactions are made on arm´ s length.
R$ million
3Q13 2Q13 3Q13 2Q13 3Q13 2Q13 3Q13 2Q13 3Q13 2Q13 3Q13 2Q13
Net Revenue 283 223 2.949 2.898 667 639 246 265 (946) (780) 3.198 3.244
Domestic Market 283 191 2.758 2.683 662 634 246 265 (946) (780) 3.003 2.992
Exports 0 33 191 215 5 5 0 0 0 0 196 252
COGS (127) (90) (2.672) (2.707) (604) (570) (235) (249) 896 749 (2.742) (2.868)
Gross Profit 156 133 276 190 63 68 10 16 (50) (31) 456 376
Operating Income(Expenses)
(29) (24) (135) (141) (49) (49) (16) (22) 1 1 (229) (234)
EBIT 126 109 141 50 14 19 (6) (6) (49) (30) 227 142
Adjusted EBITDA 139 119 376 289 28 33 0 1 (6) (1) 538 441
Adj.EBITDA Margin 49% 53% 13% 10% 4% 5% 0% 0% - - 17% 14%
* Consolidates 70% of Unigal
Income Statement per Business Units - Non Audited
ConsolidatedMining Steel*Steel
ProcessingCapital Goods Adjustment
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Results Accounted until September 2013
35
Per Business Unit
R$ million
9M13 9M12 9M13 9M12 9M13 9M12 9M13 9M12 9M13 9M12 9M13 9M12
Net Revenue 754 607 8.512 8.625 1.852 1.570 770 761 (2.251) (2.059) 9.637 9.503
Domestic Market 680 456 7.664 6.866 1.835 1.544 770 759 (2.251) (1.995) 8.698 7.629
Export Market 74 150 848 1.759 18 26 0 2 0 (64) 939 1.874
COGS (303) (234) (7.970) (8.581) (1.670) (1.423) (734) (761) 2.079 1.857 (8.598) (9.142)
Gross Profit 451 373 542 44 182 146 36 0 (172) (202) 1.039 362
Operating Income
(Expenses) (83) (132) (409) (330) (146) (154) (53) (38) 3 6 (687) (647)
EBIT 368 241 133 (285) 36 (7) (17) (37) (169) (196) 352 (285)
Adjusted EBITDA 402 267 843 358 77 31 3 (19) (33) (66) 1.292 572
Adj.EBITDA Margin 53% 44% 10% 4% 4% 2% 0% -2% - - 13% 6%
* Consolidates 70% of Unigal
Mining Steel*Steel
ProcessingCapital Goods ConsolidatedAdjustment
Note: All intercompany transactions are made on arm´ s length.
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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 Management’s
expectations in relation to future performance. These expectations are highly
dependent on market behavior, on Brazil’s economic situation, on the
industry and on international markets, and are therefore subject to change.
Cristina Morgan C. DrumondHead of IR
cristina.drumond@usiminas.com
Phone: 55-31-3499.8772
Fax: 55-31-3499.9357
Leonardo Karam Rosaleonardo.rosa@usiminas.com
Phone: 55-31-3499.8550
Diogo Dias Gonçalvesdiogo.goncalves@usiminas.com
Phone: 55-31-3499.8710
Renata Moura TerraRenata.terra@usiminas.com
Tel: 55-31-3499.8619
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