Aperam S.A. / Key word(s): Annual Results
Full year and fourth quarter 2019 results
05-Feb-2020 / 07:00 CET/CEST
"Strong cash flow and earnings despite the worst stainless market
environment since inception of Aperam"
Luxembourg, February 5, 2020 (07:00 CET) - Aperam (referred to as "Aperam"
or the "Company") (Amsterdam, Luxembourg, Paris, Brussels: APAM, NYRS:
APEMY), announced today results for the three months and full year ending
December 31, 2019.
Highlights
· Health and Safety: LTI frequency rate of 1.7x in 2019
compared to 1.4x in 2018
· Steel shipments of 1,786 thousand tonnes in 2019, 9.4%
decrease compared to steel shipments of 1,972 thousand tonnes
in 2018
· EBITDA of EUR 357 million in 2019, including an exceptional
gain2 of EUR 17 million, compared to EUR 504 million in 2018
· EBITDA of EUR 102 million in Q4 2019, including an
exceptional gain2 of EUR 17 million, compared to EUR 79
million in Q3 2019
· Net income of EUR 148 million in 2019, compared to EUR 286
million in 2018
· Basic earnings per share of EUR 1.82 in 2019, compared to
EUR 3.39 in 2018
· Cash flow from operations amounted to EUR 400 million in
2019, compared to EUR 295 million in 2018
· Free cash flow before dividend and share buy-back of EUR 281
million in 2019, including EUR 30 million from the divestment
of the entire Gerdau stake, compared to EUR 108 million in
2018
· Net financial debt of EUR 75 million as of December 31,
2019, compared to EUR 48 million as of December 31, 2018
Strategic initiatives
· Leadership Journey?(R)3 Phase 3:? The realized annualized
gains reached EUR 18 million in Q4 2019. Aperam realized
cumulative annualized gains of EUR 123 million till year end
2019
Prospects
· Adj EBITDA in Q1 2020 is expected at a comparable level to
Q4 2019 adj EBITDA
· Net financial debt is expected to increase due to seasonal
effects in Q1 2020, however, will continue to remain at low
levels
Cash Deployment
In coherence to its Financial Policy, Aperam is announcing:
· To maintain its base dividend at EUR 1.75 per share (subject
to AGM approval)
· A share buyback program of up to EUR 100 million
Timoteo Di Maulo, CEO of Aperam, commented:
"In Q4 2019 Aperam has faced the most difficult market
conditions since its inception. This was due to unprecedented
pricing pressure combined with a strong volume contraction from
trade war induced extremely high import volumes. This was
amplified by weak economic conditions in both Europe and Brazil.
In this context Aperam has achieved solid cash flow and earnings
which demonstrates the value of the Leadership Journey?(R) and
proves how this program has transformed Aperam over the past
years. Going forward we expect the economic environment to
remain challenging and high competitive pressure to persist in
2020. We are therefore intensifying our efforts to increase
efficiency and competitiveness. We will also continue in our
efforts to the European Commission to promptly set a level
playing field."
Financial Highlights (on the basis of financial information prepared under
IFRS)
(in millions of Euros, unless Q4 19 Q3 19 Q4 18 12M 19 12M 18
otherwise stated)
Sales 1,000 972 1,120 4,240 4,677
Operating income 59 43 52 207 361
Net income attributable to 29 37 49 148 286
equity holders of the parent
Basic earnings per share (EUR) 0.36 0.47 0.59 1.82 3.39
Diluted earnings per share (EUR) 0.36 0.47 0.37 1.82 3.03
Free cash flow before dividend 140 45 35 281 108
and share buy-back
Net Financial Debt (at the end 75 172 48 75 48
of the period)
Adj. EBITDA 85 79 90 340 504
Exceptional items 17 - - 17 -
EBITDA 102 79 90 357 504
Adj. EBITDA/tonne (EUR) 211 189 188 190 256
EBITDA/tonne (EUR) 254 189 188 200 256
Steel shipments (000t) 402 418 480 1,786 1,972
Health & Safety results
Health and Safety performance based on Aperam personnel figures and
contractors' lost time injury frequency rate was 1.9x in the fourth quarter
of 2019 compared to 2.2x in the third quarter of 2019. For 2019 the lost
time injury frequency rate was 1.7x after 1.4x in 2018.
Financial results analysis for full year period ending December 31, 2019
Sales for the year ended December 31, 2019 decreased by 9.3%, at EUR 4,240
million compared to EUR 4,677 million for the year ended December 31, 2018,
mainly due to lower shipments. Steel shipments in 2019 decreased by 9.4% at
1,786 thousand tonnes compared to 1,972 thousand tonnes in 2018.
EBITDA reached EUR 357 million for the year ended December 31, 2019
(including exceptional gains of EUR 17 million for PIS/Cofins tax credits
related to prior periods recognized in Brazil) compared to EBITDA of EUR 504
million for the year ended December 31, 2018. Group EBITDA declined by 29%
despite the positive effect from the Leadership Journey(R)4 and the Top Line
strategy. A weak economic environment both in Europe and Brazil weighed on
volumes while excessive imports into Europe severely depressed prices.
Brazil additionally suffered from temporarily higher raw material costs that
could not be passed on to customers.
Phase 3 of the Leadership Journey(R) - the Transformation Program -
continued to progress over the year with an annualized contribution of EUR
90 million to EBITDA.
Depreciation, amortization and impairment was EUR (150) million for the year
ended December 31, 2019.
Aperam had an operating income for the year ended December 31, 2019 of EUR
207 million compared to an operating income of EUR 361 million for the year
ended December 31, 2018.
Financing costs, net, for the year ended December 31, 2019 were EUR (23)
million, including cash cost of financing of EUR (10) million and including
an exceptional financial loss of EUR (16) million related to the early
buy-back of convertible bonds due 2021. Income tax expense for the year
ended December 31, 2019 was EUR (37) million.
The Company recorded a net income of EUR 148 million for the year ended
December 31, 2019.
Cash flows from operations for the year ended December 31, 2019 were
positive at EUR 400 million, thanks to a working capital decrease of EUR 81
million. CAPEX for the year ended December 31, 2019 was EUR 151 million.
Free cash flow before dividend and share buy-back for the year 2019 amounted
to EUR 281 million including EUR 30 million from the divestment of the
entire Gerdau stake.
As of December 31, 2019, shareholders' equity was EUR 2,418 million and net
financial debt was EUR 75 million (gross financial debt as of December 31,
2019 was EUR 450 million. Cash & cash equivalents were EUR 375 million).
Total cash returns to shareholders in 2019 amounted to EUR 235 million
consisting of EUR 93 million of share buy-back and EUR 142 million of
dividend.
During 2019, the Company fully repurchased the remaining part of Convertible
Bonds 2021 with a nominal amount of USD 237.2 million for a total
consideration of EUR 219 million.
On February 25, 2019, the Company announced the signature of a financing
contract where the European Investment Bank makes available to Aperam an
amount of EUR 100 million. The financing contract, which is senior
unsecured, with final maturity date March 15, 2029, was entirely drawn down
on March 15, 2019. .
On September 27, 2019, Aperam S.A. closed a "Schuldscheindarlehen" loan
agreement for a total aggregate amount of EUR 190 million, with maturities
spread over 4 to 7 years.
The Company had liquidity of EUR 675 million as of December 31, 2019,
consisting of cash and cash equivalents of EUR 375 million and undrawn
credit lines4 of EUR 300 million.
Financial results analysis for the three-month period ending December 31,
2019
Sales for the fourth quarter of 2019 increased by 3% to EUR 1,000 million
compared to EUR 972 million for the third quarter of 2019. Steel shipments
decreased from 418 thousand tonnes in the third quarter of 2019, to 402
thousand tonnes in the fourth quarter of 2019.
EBITDA has increased over the quarter to EUR 102 million for the fourth
quarter of 2019 (including exceptional gains of EUR 17 million for
PIS/Cofins tax credits related to prior periods recognized in Brazil) from
EUR 79 million for the third quarter of 2019. In addition to a seasonally
weak quarter in Brazil the seasonal increase in Europe was rather soft. High
import volumes into Europe caused prices to deteriorate further during the
quarter. The weak economic environment also prevented seasonally higher
volumes during Q4. Lag effects from raw material pricing caused positive
inventory valuation effects during the quarter.
Depreciation, amortization and impairment was EUR (43) million for the
fourth quarter of 2019.
Aperam had an operating income for the fourth quarter of 2019 of EUR 59
million compared to an operating income of EUR 43 million for the previous
quarter.
Financing costs for the fourth quarter of 2019 were EUR (2) million,
including cash cost of financing of EUR (3) million.
Income tax expense for the fourth quarter of 2019 was EUR (28) million,
including a EUR (26) million reversal of deferred tax assets on tax losses
in various jurisdictions.
The Company recorded a net income of EUR 29 million for the fourth quarter
of 2019.
Cash flows from operations for the fourth quarter of 2019 were positive at
EUR 162 million, with a working capital decrease of EUR 70 million. CAPEX
for the fourth quarter was EUR (52) million.
Free cash flow before dividend and share buy-back for the fourth quarter of
2019 amounted to EUR 140 million.
During the fourth quarter of 2019, the cash returns to shareholders amounted
to EUR 35 million, consisting fully of dividend.
Operating segment results analysis
Stainless & Electrical Steel (1)
(in millions of Euros, unless Q4 19 Q3 19 Q4 18 12M 19 12M 18
otherwise stated)
Sales 808 771 913 3,352 3,840
Adjusted EBITDA 71 57 87 259 422
Exceptional items 16 - - 16 -
EBITDA 87 57 87 275 422
Depreciation, amortisation & (34) (29) (34) (123) (126)
impairment
Operating income 53 28 53 152 296
Steel shipments (000t) 402 401 470 1,722 1,914
Average steel selling price 1,843 1,861 1,859 1,879 1,942
(EUR/t)
(1) Amounts are shown prior to intra-group eliminations
The Stainless & Electrical Steel segment had sales of EUR 808 million for
the fourth quarter of 2019. This represents a 4.8% increase compared to
sales of EUR 771 million for the third quarter of 2019. Steel shipments
during the fourth quarter were 402 thousand tonnes. This is stable compared
to shipments of 401 thousand tonnes during the previous quarter. The weak
economic environment in Europe and further destocking only allowed for a
soft seasonal recovery post the summer effects while the seasonal volume
decline in Brazil was supplemented by the weak economy. Average steel
selling prices for the Stainless & Electrical Steel segment slightly
decreased by -1% compared to the previous quarter.
The segment had EBITDA of EUR 275 million (of which EUR 150 million from
Europe and EUR 125 million from South America) for the year 2019 compared to
EUR 422 million (of which EUR 260 million from Europe and EUR 162 million
from South America) for the year 2018. 2019 EBITDA declined year on year
despite the successful implementation of the Top Line strategy and
Leadership Journey(R) and exceptional gains of EUR 16 million in Brazil for
PIS/Cofins tax credits related to prior periods.
Real demand was soft due to the low growth economic environment in both
Europe and Brazil. Persistent high imports into Europe depressed prices.
Soft global prices impacted margins in Brazil and made it impossible to pass
on temporarily higher raw material costs to customers.
The segment generated EBITDA of EUR 87 million for the fourth quarter of
2019 compared to EUR 57 million for the third quarter of 2019 including
exceptional gains of EUR 16 million in Brazil for PIS/Cofins tax credits
related to prior periods. Slightly higher volumes in Europe and positive
inventory valuation effects from raw material pricing added to the higher
EBITDA which was partly compensated by deteriorating prices and a seasonally
weak quarter in Brazil.
Depreciation, amortisation and impairment expense was EUR (34) million for
the fourth quarter of 2019.
The Stainless & Electrical Steel segment had an operating income of EUR 53
million for the fourth quarter of 2019 compared to an operating income of
EUR 28 million for the third quarter of 2019.
Services & Solutions(1)
(in millions of Euros, unless Q4 19 Q3 19 Q4 18 12M 19 12M 18
otherwise stated)
Sales 382 418 467 1,773 2,066
Adjusted EBITDA 4 9 (3) 45 43
Exceptional items 1 - - 1 -
EBITDA 5 9 (3) 46 43
Depreciation & amortisation (5) (2) (3) (13) (9)
Operating income - 7 (6) 33 34
Steel shipments (000t) 144 166 181 706 819
Average steel selling price 2,470 2,397 2,513 2,381 2,428
(EUR/t)
(1) Amounts are shown prior to intra-group eliminations
The Services & Solutions segment had sales of EUR 382 million for the fourth
quarter of 2019, representing a decrease of 8.6% compared to sales of EUR
418 million for the third quarter of 2019. For the fourth quarter of 2019,
steel shipments were 144 thousand tonnes compared to 166 thousand tonnes
during the previous quarter. The Services & Solutions segment had higher
average steel selling prices during the period compared to the previous
period.
The segment recorded EBITDA of EUR 46 million for the year 2019 compared to
EUR 43 million for the year 2018. The higher result despite weak demand and
negative inventory valuation was attributable to higher margin, lower costs
through the Leadership Journey as well as various smaller positive items
including Pis/Cofins credits.
The segment generated EBITDA of EUR 5 million for the fourth quarter of 2019
compared to EBITDA of EUR 9 million for the third quarter of 2019. EBITDA
decreased mainly due to a pronounced 13% seasonal decline in volumes quarter
on quarter.
Depreciation and amortisation was EUR (5) million for the fourth quarter of
2019.
The Services & Solutions segment had an operating income of less than EUR 1
million for the fourth quarter of 2019 compared to an operating income of
EUR 7 million for the third quarter of 2019.
Alloys & Specialties(1)
(in millions of Euros, unless Q4 19 Q3 19 Q4 18 12M 19 12M 18
otherwise stated)
Sales 160 128 138 597 554
EBITDA 14 12 7 50 46
Depreciation & amortisation (1) (3) (1) (8) (6)
Operating income 13 9 6 42 40
Steel shipments (000t) 9 8 9 36 36
Average steel selling price 16,384 16,018 14,989 15,949 14,635
(EUR/t)
(1) Amounts are shown prior to intra-group eliminations
The Alloys & Specialties segment had sales of EUR 160 million for the fourth
quarter of 2019, representing an increase of 25% compared to EUR 128 million
for the third quarter of 2019. Steel shipments were higher during the fourth
quarter of 2019 at 9 thousand tonnes compared to 8 thousand tonnes during
the third quarter of 2019. Average steel selling prices increased over the
quarter.
The segment recorded EBITDA of EUR 50 million for the year 2019 compared to
EUR 46 million for the year 2018 despite negative inventory valuation
effects due to lower raw material prices. This is mainly attributable to the
contribution of the Top Line strategy and Leadership Journey?(R).
The Alloys & Specialties segment achieved EBITDA of EUR 14 million for the
fourth quarter of 2019 compared to EUR 12 million for the third quarter of
2019. The increase in EBITDA was mainly due to higher shipments despite
negative raw material induced inventory valuation effects.
Depreciation and amortisation expense for the fourth quarter of 2019 was EUR
(1) million.
The Alloys & Specialties segment had an operating income of EUR 13 million
for the fourth quarter of 2019 compared to an operating income of EUR 9
million for the third quarter of 2019.
Recent developments
· During the fourth quarter of 2019, Aperam has received final and
unappealable court decision (following the Supreme Court decision in the
leading case) in respect of its long ongoing dispute with tax authorities
to exclude ICMS from the PIS / COFINS's tax base. Accordingly Aperam has
recognized extra credits in Q4 2019 amounting to EUR 17 million EUR as
EBITDA.
Aperam will potentially be able to also recoup overpaid amounts and account
for additional pre tax income of up to EUR 200 million (including
approximately up to EUR 100 million in EBITDA and approximately up to EUR
100 million in interest income) after approval of Court / confirmation by
the Tax Department for recovery of overpaid amounts. These amounts would be
recognized in the P&L in the year 2020 while the cash collection (net of
tax) would take several years.
· On December 5, 2019, Aperam announced its financial calendar for 2020.
· On December 16, 2019 Aperam announced its 2030 environmental objectives
and ambition to be carbon neutral in its European operations by 2050,
contributing to the European Commission's Green Deal. By 2030 and against
the 2015 baseline Aperam targets to reduce CO2 emissions by 15%, reduce
energy usage by 11%, reduce water intake by 40%, reduce dust emission by
70% and increase waste recycling to >97%. Aperam is the world's greenest
stainless steel producer thanks to the use of charcoal from our
sustainably cultivated forests in Brazil[1] and its European production
route based on fully recyclable stainless steel scrap. .
New developments
· On February 5, 2020 Aperam announced its detailed dividend payment
schedule for 2020. The Company proposes to maintain its base dividend at
EUR 1.75 per share, subject to shareholder approval at the 2020 Annual
General Meeting. The schedule is available on Aperam's website
www.aperam.com under Investors > Equity Investors > Dividends.
· On February 5, 2020, Aperam announced a share buyback program of up to
EUR 100 million, and a maximum of 3.8 million shares under the
authorization given by the annual general meeting of shareholders held on
7 May 2019. The details of the program are available in a separate Press
Release.
· On February 5, 2020, Aperam announced the resignation of Sandeep Jalan,
CFO who will be leaving Aperam to pursue other career opportunities
outside the steel and mining industry. Mr Jalan is expected to leave the
company around beginning of May to assure a smooth transition. The
succession will be announced in due course.
Investor conference call
Aperam management will host a conference call for members of the investment
community to discuss the fourth quarter 2019 and full year 2019 financial
performance at the following time:
Date New York London Luxembourg
Wednesday, 5:00 am 10:00 am 11:00 am
February 5, 2020
The dial-in numbers for the call are: international +44 (0) 20 3003 2666;
USA +1 212 999 6659 . The conference password is Aperam.
A replay of the conference call will be available for one year at
https://channel.royalcast.com/webcast/aperam/20200205_1/ [1]
Contacts
Corporate Communications / Laurent Beauloye: +352 27 36 27 103
Investor Relations / Thorsten Zimmermann: +352 27 36 27 304
About Aperam
Aperam is a global player in stainless, electrical and specialty steel, with
customers in over 40 countries. The business is organised in three primary
operating segments: Stainless & Electrical Steel, Services & Solutions and
Alloys & Specialties.
Aperam has a flat Stainless and Electrical steel capacity of 2.5 million
tonnes in Brazil and Europe and is a leader in high value specialty
products. In addition to its industrial network, spread over six production
facilities in Brazil, Belgium and France, Aperam has a highly integrated
distribution, processing and services network and a unique capability to
produce stainless and special steels from low cost biomass (charcoal made
from its own FSC-certified forestry).
In 2019, Aperam had sales of EUR 4,240 million and steel shipments of 1.79
million tonnes.
For further information, please refer to our website at www.aperam.com
Forward-looking statements
This document may contain forward-looking information and statements about
Aperam and its subsidiaries. These statements include financial projections
and estimates and their underlying assumptions, statements regarding plans,
objectives and expectations with respect to future operations, products and
services, and statements regarding future performance. Forward-looking
statements may be identified by the words "believe," "expect," "anticipate,"
"target" or similar expressions. Although Aperam's management believes that
the expectations reflected in such forward-looking statements are
reasonable, investors and holders of Aperam's securities are cautioned that
forward-looking information and statements are subject to numerous risks and
uncertainties, many of which are difficult to predict and generally beyond
the control of Aperam, that could cause actual results and developments to
differ materially and adversely from those expressed in, or implied or
projected by, the forward-looking information and statements. These risks
and uncertainties include those discussed or identified in Aperam's filings
with the Luxembourg Stock Market Authority for the Financial Markets
(Commission de Surveillance du Secteur Financier). Aperam undertakes no
obligation to publicly update its forward-looking statements or information,
whether as a result of new information, future events, or otherwise.
APERAM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(in million of EURO) December September 30, December 31,
31, 2019 2018
2019
ASSETS
Cash & cash 375 357 199
equivalents (C)
Inventories, trade 655 742 744
receivables and trade
payables
Prepaid expenses and 84 98 77
other current assets
Total Current Assets 1,114 1,197 1,020
& Working Capital
Goodwill and 479 483 490
intangible assets
Property, plant and 1,653 1,593 1,589
equipment (incl.
Biological assets)
Investments in 4 29 32
associates, joint
ventures and other
Deferred tax assets 128 155 160
Other non-current 81 81 92
assets
Total Assets (net of 3,459 3,538 3,383
Trade Payables)
LIABILITIES AND
SHAREHOLDERS' EQUITY
Short-term debt and 85 164 66
current portion of
long-term debt (B)
Accrued expenses and 263 285 270
other current
liabilities
Total Current 348 449 336
Liabilities
(excluding Trade
Payables)
Long-term debt, net 365 365 181
of current portion
(A)
Deferred employee 146 145 148
benefits
Deferred tax 130 131 131
liabilities
Other long-term 52 54 68
liabilities
Total Liabilities 1,041 1,144 864
(excluding Trade
Payables)
Equity attributable 2,414 2,390 2,515
to the equity holders
of the parent
Non-controlling 4 4 4
interest
Total Equity 2,418 2,394 2,519
Total Liabilities and 3,459 3,538 3,383
Shareholders' Equity
(excluding Trade
Payables)
Net Financial Debt (D 75 172 48
= A+B-C)*
* Increase in Net Financial Debt by EUR 27 million from EUR 48 million as of
December 31, 2018 to EUR 75 million as of December 31, 2019
primarily due to accounting effects (+EUR 56 million out of which IFRS 16
Leases +EUR 29 million and Convertible Bonds 2021 repurchases
+EUR 27 million).
APERAM CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(in million Three Months Ended Twelve Months Ended
of EURO)
December September December December December
31, 2019 30, 2019 31, 2018 31, 2019 31, 2018
Sales 1,000 972 1,120 4,240 4,677
Adjusted 85 79 90 340 504
EBITDA (E =
C-D)
Adjusted 8.5% 8.1% 8.0% 8.4% 10.8%
EBITDA
margin (%)
Exceptional 17 - - 17 -
items (D)
EBITDA (C = 102 79 90 357 504
A-B)
EBITDA 10.2% 8.1% 8.0% 8.4% 10.8%
margin %
Depreciation (43) (36) (38) (150) (143)
,
amortisation
& Impairment
(B)
Operating 59 43 52 207 361
income (A)
Operating 5.9% 4.4% 4.6% 4.9% 7.7%
margin %
Result from - 1 - 1 1
other
investments
and
associates
Financing (2) (1) 13 (23) (5)
costs, net
Income 57 43 65 185 357
before taxes
Income tax (28) (6) (16) (37) (71)
expense
Effective 50.4% 13.0% 24.7% 20.2% 19.8%
tax rate %
Net income 29 37 49 148 286
attributable
to equity
holders of
the parent
Basic 0.36 0.47 0.59 1.82 3.39
earnings per
share (EUR)
Diluted 0.36 0.47 0.37 1.82 3.03
earnings per
share (EUR)
Weighted 79,818 79,804 83,560 81,172 84,345
average
common
shares
outstanding
(in
thousands)
Diluted 80,078 80,801 87,958 81,432 89,052
weighted
average
common
shares
outstanding
(in
thousands)
APERAM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(in million Three Months Ended Twelve Months Ended
of EURO)
December September December December December
31, 2019 30, 2019 31, 2018 31, 2019 31, 2018
Operating 59 43 52 207 361
income
Depreciation 43 36 38 150 143
,
amortisation
& Impairment
Change in 70 (2) 12 81 (197)
working
capital
Income tax (6) (1) (7) (5) (36)
(paid) /
refund
Interest (1) (1) (1) (5) (5)
paid, (net)
Other (3) (5) (6) (28) 29
operating
activities
(net)
Net cash 162 70 88 400 295
provided by
operating
activities
(A)
Purchase of (52) (26) (55) (151) (192)
PPE,
intangible
and
biological
assets
(CAPEX)
Other 30 1 2 32 5
investing
activities
(net)
Net cash (22) (25) (53) (119) (187)
used in
investing
activities
(B)
Proceeds (84) 160 27 139 (13)
(payments)
from payable
to banks and
long term
debt
Purchase of - - - (93) (70)
treasury
stock (share
buy back)
Dividends (35) (35) (34) (142) (130)
paid
Other (3) (1) (1) (8) (1)
financing
activities
(net)
Net cash (122) 124 (8) (104) (214)
provided by
(used in)
financing
activities
Effect of - (1) 3 (1) (1)
exchange
rate changes
on cash
Change in 18 168 30 176 (107)
cash and
cash
equivalent
Free cash 140 45 35 281 108
flow before
dividend and
share
buy-back (C
= A+B)
Appendix 1a - Health & Safety statistics
Health & Three Months Ended Year Ended
Safety
Statistics
December September December December December
31, 2019 30, 2019 31, 2018 31, 2019 31, 2018
Frequency 1.9 2.2 0.8 1.7 1.4
Rate
Lost time injury frequency rate equals lost time injuries per 1,000,000
worked hours, based on own personnel and contractors.
Appendix 1b - Key operational and financial information
Year Ending Stainless & Services & Alloys & Others & Total
December 31, Electrical Solutions Specialt Eliminati
2019 Steela,b ies ons
Operational
information
Steel Shipment 1,722 706 36 (678) 1,786
(000t)
Average steel 1,879 2,381 15,949 2,297
selling price
(EUR/t)
Financial
information
(EURm)
Sales (EURm) 3,352 1,773 597 (1,482) 4,240
Adjusted EBITDA 259 45 50 (14) 340
(EURm)
Exceptional 16 1 - - 17
items (EURm)
EBITDA (EURm) 275 46 50 (14) 357
Depreciation, (123) (13) (8) (6) (150)
amortisation &
impairment
(EURm)
Operating 152 33 42 (20) 207
income / (loss)
(EURm)
Note a: Stainless & Electrical Steel shipments of 1,722kt of which 609kt
were from South America and 1,113kt were from Europe
Note b: Stainless & Electrical Steel EBITDA of EUR 275m of which EUR 125m
were from South America and EUR 150m were from Europe
Year Ending Stainless & Services & Alloys & Others & Total
December 31, Electrical Solutions Specialt Eliminati
2018 Steela,b ies ons
Operational
information
Steel Shipment 1,914 819 36 (797) 1,972
(000t)
Average steel 1,942 2,428 14,635 2,305
selling price
(EUR/t)
Financial
information
(EURm)
Sales 3,840 2,066 554 (1,783) 4,677
EBITDA 422 43 46 (7) 504
Depreciation & (126) (9) (6) (2) (143)
Amortisation
(EURm)
Operating 296 34 40 (9) 361
income / (loss)
(EURm)
Note a: Stainless & Electrical Steel shipments of 1,914kt of which 647kt
were from South America and 1,267kt were from Europe
Note b: Stainless & Electrical Steel EBITDA of EUR 422m of which EUR 162m
were from South America and EUR 260m were from Europe
Quarter Ending Stainless & Services & Alloys & Others & Total
Electrical Solutions Specialt Eliminati
Steel ies ons
December 31,
2019
Operational
information
Steel Shipment 402 144 9 (153) 402
(000t)
Average steel 1,843 2,470 16,384 2,393
selling price
(EUR/t)
Financial
information
(EURm)
Sales (EURm) 808 382 160 (350) 1,000
Adjusted EBITDA 71 4 14 (4) 85
(EURm)
Exceptional 16 1 - - 17
items (EURm)
EBITDA (EURm) 87 5 14 (4) 102
Depreciation, (34) (5) (1) (3) (43)
amortisation &
Impairment
(EURm)
Operating 53 - 13 (7) 59
income / (loss)
(EURm)
Quarter Ending Stainless & Services & Alloys & Others & Total
Electrical Solutions Specialt Eliminati
Steel ies ons
September 30,
2019
Operational
information
Steel Shipment 401 166 8 (157) 418
(000t)
Average steel 1,861 2,397 16,018 2,264
selling price
(EUR/t)
Financial
information
Sales (EURm) 771 418 128 (345) 972
EBITDA (EURm) 57 9 12 1 79
Depreciation & (29) (2) (3) (2) (36)
Amortisation
(EURm)
Operating 28 7 9 (1) 43
income / (loss)
(EURm)
Appendix 2 - Terms and definitions
Unless indicated otherwise, or the context otherwise requires, references in
this earnings release report to the following terms have the meanings set
out next to them below:
Adjusted EBITDA: operating income before depreciation, amortization and
impairment expenses and exceptional items.
Adjusted EBITDA/tonne: calculated as Adjusted EBITDA divided by total steel
shipments.
Average steel selling prices: calculated as steel sales divided by steel
shipments.
Cash and cash equivalents: represents cash and cash equivalents, restricted
cash and short-term investments.
CAPEX: relates to capital expenditures and is defined as purchase of
tangible assets, intangible assets and biological assets.
EBITDA: operating income before depreciation, amortisation and impairment
expenses.
EBITDA/tonne: calculated as EBITDA divided by total steel shipments.
Exceptional items: consists of (i) inventory write-downs equal to or
exceeding 10% of total related inventories values before write-down at the
considered quarter end (ii) restructuring (charges)/gains equal to or
exceeding EUR 10 million for the considered quarter, (iii) capital
(loss)/gain on asset disposals equal to or exceeding EUR 10 million for the
considered quarter or (iv) other non-recurring items equal to or exceeding
EUR 10 million for the considered quarter.
Financing costs: Net interest expense, other net financing costs and foreign
exchange and derivative results.
Free cash flow before dividend and share buy-back: net cash provided by
operating activities less net cash used in investing activities.
Gross financial debt: long-term debt plus short-term debt.
Liquidity: Cash and cash equivalent and undrawn credit lines.
LTI frequency rate: Lost time injury frequency rate equals lost time
injuries per 1,000,000 worked hours, based on own personnel and contractors.
Net financial debt: long-term debt, plus short-term debt less cash and cash
equivalents.
Net financial debt/EBITDA or Gearing: Refers to Net financial debt divided
by last twelve months EBITDA calculation.
Shipments: information at segment and group level eliminates inter-segment
shipments (which are primarily between Stainless & Electrical Steel and
Services & Solutions) and intra-segment shipments, respectively.
Working capital: trade accounts receivable plus inventories less trade
accounts payable.
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1 The financial information in this press release and Appendix 1 has been
prepared in accordance with the measurement and recognition criteria of
International Financial Reporting Standards ("IFRS") as adopted in the
European Union. While the interim financial information included in this
announcement has been prepared in accordance with IFRS applicable to interim
periods, this announcement does not contain sufficient information to
constitute an interim financial report as defined in International
Accounting Standard 34, "Interim Financial Reporting". Unless otherwise
noted the numbers and information in the press release have not been
audited. The financial information and certain other information presented
in a number of tables in this press release have been rounded to the nearest
whole number or the nearest decimal. Therefore, the sum of the numbers in a
column may not conform exactly to the total figure given for that column. In
addition, certain percentages presented in the tables in this press release
reflect calculations based upon the underlying information prior to rounding
and, accordingly, may not conform exactly to the percentages that would be
derived if the relevant calculations were based upon the rounded numbers.
This press release also includes Alternative Performance Measures ("APM"
hereafter). The Company believes that these APMs are relevant to enhance the
understanding of its financial position and provides additional information
to investors and management with respect to the Company's financial
performance, capital structure and credit assessment. These non-GAAP
financial measures should be read in conjunction with and not as an
alternative for, Aperam's financial information prepared in accordance with
IFRS. Such non-GAAP measures may not be comparable to similarly titled
measures applied by other companies. The APM's used are defined under
Appendix 2 "Terms & definitions".
2 Exceptional gain of EUR 17 million in 2019 related to PIS/Cofins tax
credits related to prior periods recognized in Brazil.
3 The Leadership Journey(R) is an initiative launched on December 16, 2010,
and subsequently accelerated and increased, to target management gains and
profit enhancement. The third phase of the Leadership Journey(R) - the
Transformation Program - was initially targeting EUR 150 million of
additional EBITDA gains per year by end of 2020. In February 2019, the
annualized gains target has been increased by EUR 50 million to reach EUR
200 million by year end 2020.
4 Includes a revolving credit facility of EUR 300 million.
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[1] Scope 1 + 2
Dissemination of a Financial Wire News, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
968099 05-Feb-2020 CET/CEST
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(END) Dow Jones Newswires
February 05, 2020 01:00 ET (06:00 GMT)
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