4Q13 - Presentation

8/12/2019 4Q13 - Presentation

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Apresentao Usiminas

2T11 - APIMEC

4Q13 and 2013 Results

Information Classification: Public


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Clique paraeditar o texto

mestre

Usiminas and its

Business Units

Financial

Results

CompanyProfile and

Market Data

Agenda

2


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Sale ofAutomotiva

Usiminas

Aquisition ofJ. Mendes

iron oremines

Aquisition ofZamprogna

Foundationof Solues

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:

1991Cosipa: 1993

Listing onBOVESPA

Listing onLatibex

Creation ofMineraoUsiminas

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

2013

Listing onADR I - NY

1994


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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

Cubato

Unigal UsiminasMinerao Usiminas

Solues Usiminas Usiminas Mecnica

Complete Solution of Products and Services

5

Automotiva Usiminas*

*Sold in november 2013, see slide 22.

Business units


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World Crude Steel Production in 2013Million tons

32.8

34.2

34.7

42.6

66.0

69.4

81.2

87.0

110.6

779.0

Ukraine

Brazil

Turkey

Germany

South Korea

Russia

India

USA

Japan

China

Source: World Steel Association 6

Capacity

2,137

Production

1,607

Consumption

1,475

Excess ofCapacity

530

Excess ofProduction

132


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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

3.9 3.9 3.9

3.6

3.8 3.8 3.8

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

3.53.6

3.4 3.4

3.7

4.0

3.6

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

413

512

335 319 323

601

421

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

1.0 1.0 0.9 1.0 1.1 1.1 1.1

2.8 2.7 2.6 2.8 3.1

2.7 2.7

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

Million tons Monthly Basis


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Usiminas and its

Business Units

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

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 Cold

Rolled and Galvanized (EGand 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

5,637

7,299

6,699

7,1586,859

2009 2010 2011 2012 2013


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4,043 4,914 4,871 5,044

5,407

1,588

1,6511,045

1,837 8135,631

6,565

5,916

6,881

6,220

2009 2010 2011 2012 2013

Steel Business - Sales VolumeThousand tons

12

Highest volume of steel sales in the domestic market in the last 5 years

1,209 1,226 1,428 1,453 1,299

522 365 144 112

193

1,7311,591 1,572 1,565

1,492

4Q12 1Q13 2Q13 3Q13 4Q13

Exports Domestic market Total


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Domestic Market: Sales per segment

13

Steel Business Unit

30%

15%

8%10%

38%

Auto Industry

Industry in general

Household Appliances

Civil Construction

Distribuion

4Q13

32%

16%

7%

10%

35%

2013


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20

178

289

376

308

1%

7%

10%

13%

11%

4Q12 1Q13 2Q13 3Q13 4Q13

Adjusted EBITDA Adjusted EBITDA Margin

R$ Million

277

1,1512%

10%

2012 2013

Steel Business - Adjusted EBITDA /Adjusted EBITDA Margin

14

In 2013 the EBITDA Margin on the Steel Business increased 800 bps


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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

15

Hot Strip Mill II and NewPickling Line - Cubato

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

Investments Concluded


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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

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

MUSAOeste

Itatiaiuu

Igarap So Joaquim

De Bicas

70.0%

30.0%

Mining Business

Minerao Usiminas16

Description


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Production - Million tons

17

Mining Business

5.5

6.86.3

6.7 6.5

2009 2010 2011 2012 2013


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1,237 1,133 994 1,043 1.048

1748

206

787 996493

165 166

1681,747

1,346 1,366

1,830

2,212

4Q12 1Q13 2Q13 3Q13 4Q13

Exports Sales to 3rd parties - DM Sales to Usiminas Total

4,331 4,219

446

2,0361,338

4996,115

6,754

2012 2013

Mining Business Sales volumeThousand tons

18

The Friable Project takes MUSA to an other level of production and quality

+10%

+21%


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173144

119 139

181

59% 58%

53%

49% 47%

4Q12 1Q13 2Q13 3Q13 4Q13


439

582

49% 51%

2012 2013

+33%

Mining Business - Adjusted EBITDA and MarginR$ Million

19

In 2013 MUSA present a strong growth of EBITDA and maintained its Margin stable

+30%


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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

20

Mining Business


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Mining Business

21

Retro Area in Itaguai Port


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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$2,464 million in 2013

Steel ProcessingSolues Usiminas and Automotiva Usiminas

22Solues Usiminas

Automotiva

Camaari

Porto Alegre

Campo Limpo Paulista

Guarulhos BonsucessoGuarulhos So Roque

Taubat

Recife

Serra

Betim

Santa Luzia

Solues Usiminas

Automotiva Usiminas

The acquisition of the shares of Automotiva Usiminas byAethra Sistemas Automotivos S.A. was concluded.The sales prices (company value), based on the financialstatements on 03/31/2013, was R$210.0 million.

After fulfilling the conditions precedent in the Contract, thesales transaction of Automotiva was concluded in the netvalue of R$155.5 million. The Usiminas debt was reduced byR$54.7 million and the positive effect of its result wasR$15.3 million.Results of Automotiva were accounted for by Usiminas untilNovember 2013.

Net revenue was R$312.3 million in 2013.


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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$972 million in 2013

Usiminas Mecnica

Capital Goods

23

Braslia 3rd Bridge

23

Oil Platform


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Usiminas and its

Business Units

Financial

Results

Agenda

24

CompanyProfile and

Market Data


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Consolidated - Gross Profit, EBIT and Net ProfitR$ million

481

1,476

-473

520

-598

17

2012 2013

Gross Profit

EBIT

Net Income

+R$995 million

+R$993 million

+R$615 million

25

In 2013 the companys loss was reverted into net income


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226

313

441

538 514

7%10%

14%

17% 16%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

100

200

300

400

500

600

700

800

4Q12 1Q13 2Q13 3Q13 4Q13


Consolidated - Adjusted EBITDA/ Adjusted EBITDA MarginR$ Million

26

In 2013 the EBITDA Margin increased 900 Bps.

697

1,806

5%

14%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

0

500

1,000

1,500

2,000

2,500

3,000

2012 2013


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4.8

2.6 2.7

2.2

2.8

2.5

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

27

Consolidated - Working CapitalFocus on Working Capital control R$ billion

Average

2.6

Maintaining a balance level of working capital


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Consolidated Cash, Gross Debt and Net Debt / EBITDAR$ million

4,661

4,239

4,736

3,990 3,469

8,0717,851 8,016

7,499

6,903

4.94.4

3.22.5

1.9

4Q12 1Q13 2Q13 3Q13 4Q13

Cash Gross Debt Net Debt/EBITDA (x)

28

Remarkable decrease on gross debt and net leverage


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3,070

1,849

975600

41

365

555

317

81

276

112

64

3,192

2,490

1,642

981

2010 2011 2012 2013

Others Mining Steel Total29

Consolidated - Capex EvolutionR$ million

Strict CAPEX control


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Consolidated - Debt Profile and Cash PositionR$ million

30

2,539

857 922 753999

311

670

18 7

930

499 420 517291

631 4

20

Cash 2014 2015 2016 2017 2018 2019 2020 2021

Debt Profile

Foreign Currency Local Currency

3,469

1,356 1,3421,290

942

675

721

1,270

Duration: R$: 35 months

US$: 34 months


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Results achieved in 2013

31

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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2012 2013 Costs

CAPEX

Working Capital

2013 2015 Productivity Increase of Industrial Engineeringand Benchmarking

Operational Efficiency

Domestic Sales Increase Leverage Reduction

Companys Profitability Recovery

Continuous Process of development

Final Message

32


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Quarterly Results Accounted

33

Per Business Unit R$ Millions

Note:All intercompany transactions are made on arms length.

R$ million

4Q13 3Q13 4Q13 3Q13 4Q13 3Q13 4Q13 3Q13 4Q13 3Q13 4Q13 3Q13

Net Revenue 382 283 2,824 2,949 612 667 202 246 (828) (946) 3,193 3,198

Domestic Market 345 283 2,521 2,758 609 662 190 246 (828) (946) 2,835 3,002

Exports 38 0 304 191 3 5 12 0 0 0 357 196

COGS (200) (127) (2,600) (2,672) (559) (604) (188) (235) 790 896 (2,756) (2,742)

Gross Profit 182 156 225 276 53 63 15 10 (38) (50) 437 455

Operating Income(Expenses)

(42) (29) (158) (135) (52) (49) (19) (16) 2 1 (269) (229)

EBIT 141 126 67 141 1 14 (5) (6) (36) (49) 168 226

Adjusted EBITDA 181 139 308 376 13 28 2 0 10 (6) 514 538

Adj.EBITDA Margin 47% 49% 11% 13% 2% 4% 1% 0% -1% 1% 16% 17%

*Consolidates 70% of Unigal **Accounts the Aultomotiva Usiminas results until November 2013

Income Statement per Business Units - Non Audited

ConsolidatedMining Steel*Steel

Processing**Capital Goods Adjustment


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2013 Results

34

Per Business Unit R$ Millions

Note:All intercompany transactions are made on arms length.

R$ million

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012

Net Revenue 1,136 899 11,336 11,453 2,464 2,077 972 1,017 (3,079) (2,735) 12,829 12,711

Domestic Market 1,024 669 10,185 9,054 2,443 2,046 960 1,015 (3,079) (2,671) 11,533 10,113

Export Market 112 229 1,151 2,399 21 31 12 2 0 (64) 1,296 2,598

COGS (503) (342) (10,570) (11,489) (2,229) (1,887) (922) (997) 2,869 2,486 (11,354) (12,230)

Gross Profit 633 557 767 (36) 235 190 51 20 (210) (249) 1,476 481

Operating Income(Expenses) (124) (151) (567) (571) (198) (183) (72) (56) 5 7 (956) (954)

EBIT 509 405 200 (608) 37 7 (21) (36) (205) 242 520 (473)

Adjusted EBITDA 582 439 1,151 277 90 60 6 (11) (23) (69) 1,806 697

Adj.EBITDA Margin 51% 49% 10% 2% 4% 3% 1% -1% - 3% 14% 5%

*Consolidates 70% of Unigal **Accounts the Aultomotiva Usiminas results until November 2013

Income Statement per Business Units - Non Audited

Mining Steel*Steel

Processing**Capital Goods ConsolidatedAdjustment


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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

Leonardo Karam RosaIR Manager

[email protected]

Phone: 55-31-3499.8550

Diogo Dias GonalvesIR Manager

[email protected]

Phone: 55-31-3499.8710

Renata Costa CoutoIR Analist

[email protected]

Phone: 55-31-3499.8619

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