Company Presentation And Strategy 5N21

Transcription

1 Company Presentation And Strategy 5N21 1

2 Forward-looking statement This presentation may contain forward-looking information within the meaning of applicable securities laws. All information and statements other than statements of historical facts contained in this presentation are forward-looking information. Such statements and information may be identified by words such as about, approximately, may, believes, expects, will, intends, should, plans, predicts, potential, projects, anticipates, estimates, continues or similar words or the negative thereof or other comparable terminology. Forward-looking statements are based on the best estimates available to 5N Plus at this time and involve known and unknown risks, uncertainties and other factors that may cause 5N Plus actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. A description of the risks affecting 5N Plus business and activities appears under the heading Risk and Uncertainties of 5N Plus MD&A dated February 21, 2017 and notes 11 and 12 of the unaudited condensed interim consolidated financial statements for the three-month periods ended March 31, 2017 and available on SEDAR at No assurance can be given that any events anticipated by the forward-looking information in this presentation will transpire or occur, or if any of them do so, what benefits that 5N Plus will derive therefrom. In particular, no assurance can be given as to the future financial performance of 5N Plus. The forwardlooking information contained in this presentation is made as of the date hereof and 5N Plus undertakes no obligation to publicly update such forward-looking information to reflect new information, subsequent or otherwise, unless required by applicable securities laws. The reader is warned against placing undue reliance on these forward-looking statements. 2

3 Who are we and what industries we enable? PHARMACEUTICAL INDUSTRY, COSMETICS, NUTRITION ALLOYS, 3D PRINTING, POWER GENERATION, GLASS INDUSTRY TOUCH SCREENS, MEDICAL IMAGING, 5G PAINTS & PIGMENTS, ANTI-CORROSION, INDUSTRIAL SALTS 5N Plus is a leading producer of specialty metals, chemicals and engineered materials. The Company manufactures critical precursors and key enablers used in a number of industries. SOLAR POWER, THERMOELECTRIC COOLING, WASTE HEAT RECOVERY REFINING, RECYCLING DEFENCE, INTERNET OF THINGS, SATELLITE SOLAR ARRAYS, RADIATION DETECTION & IMAGERY 3

4 Global Footprint Lübeck, Germany Trumbull, USA Eisenhüttenstadt, Germany South Korea St-George, USA HEAD OFFICE Montreal, Canada Tilly, Belgium Shangyu, China Zhuhai, China Kulim, Malaysia Vientiane, Laos Offices Integrated sites 4

5 Mission Statement As a leading global material technology company, our mission, each and everyday, is to earn and retain the privilege to be essential to our customers, preferred by our employees and trusted among our shareholders in a quest to enable innovation and technology deployment based on natural resources for the betterment of the human race. 5

6 ARJANG (AJ) ROSHAN CEO RICHARD PERRON CFO EVELYNE BUNDOCK VP HUMAN RESOURCES PAUL TANCELL EVP ECO-FRIENDLY MATERIALS NICHOLAS AUDET EVP ELECTRONIC MATERIALS PASCAL COURSOL VP, PRIMARY SECONDARY REFINING AND RECYCLING CORPORATE R&D 6

7 2015 proved to be a challenging year for the Company began with change in the leadership and immediate focus on the following priorities: Strengthening the balance sheet and liquidity. Improving operational efficiency while reducing earnings volatility. Repositioning commercial activities while reducing earnings volatility. 7

8 A transitional year Quality Earnings Growth With support from the Board of Directors, Management launched a strategic review and by September of delivered a new plan called 5N21 based on the following premises: Reduced Earnings Volatility Diversified Earnings 8

9 UPSTREAM: Maximum Benefit: High Metal Prices Utilize technology to extract critical metals from complex streams at attractive terms UPSTREAM PROFIT POOL 5N21 Business model DOWNSTREAM PROFIT POOL DOWNSTREAM: Maximum Benefit: Low Metal Prices Manufacturing and sale of industrial product and material with high degree of value-added activity and transformation. New area of development for 5N Plus 9

10 Downstream opportunities KEY TAKEAWAYS: 5N Plus is a leader in virtually all segments served MARKET GROWTH PROSPECT CURRENT CAPITAL REQUIREMENTS 5N S POSITION Pharma, Health and Nutrition High High Market Leader 5N Plus will harvest current asset base, requiring less CAPEX in the future Electronics and Electro-Optics Average Low Top 3 Industrial Chemicals Average Low Top 3 Coating and Pigments Average Low Top 3 Customers of 5N Plus are among industry leaders Alternative Energy High Low Market Leader Aerospace, Security and Defence High Low Top 3 10

11 Selectivity and focus will be tenet of our approach Extract more value from global assets, capabilities and core businesses. Extract value from upstream and largest component of cost: metal. Deliver quality growth from existing growth initiatives and from the future M&A months months Post 30 months 11

12 Delivering Quality Growth Micro Powders ELECTRONIC SOLDERS CONDUCTIVE INTERFACE BRAZING SPRAY TECHNOLOGIES NET-SHAPE PARTS 12

13 Delivering Quality Growth Semiconductors NIGHT VISION MEDICAL IMAGING AIRBORNE CONTROL SPACE 13

14 Plan Milestones Adjusted EBITDA grows to $21 - $27M* Earnings volatility reduce by 50% v ROCE improves to 15%* and Adjusted EBITDA grows to $40-$60M * Assumption: Metal price as of July ᵛ Base of Comparison: 2014 Assumption: Metal price as of July with no more than 30% decline 14

15 Reduction of Earnings Volatility 5N21 Plan is designed to significantly reduce volatility of earnings Simulation of % EBITDA change when metal prices change by ±30% in 5N21 100% 50% 0% -50% -100% Metal price + 30% Current Trend + 30% Current Trend -30% Metal price - 30% * Assumption: Metal price as of July 15

16 Fiscal year Ended December 31, Quarter Ended March 31,

17 Metal Prices Bismuth $22.49 Gallium $230 Germanium $1,900 $9.04 $9.48 $9.26 $9.92 $10.03 $9.92 $120 $115 $120 $110 $150 $125 $1,300 $1,200 $1,150 $850 $870 $ MAR JUNE SEPT MAR MAR JUNE SEPT MAR MAR JUNE SEPT MAR 2017 Indium Selenium Tellurium $630 $49 $110 $40 $29 $230 $245 $225 $190 $190 $190 $15 $10 $20 $20 $20 $25 $25 $25 $28 $ MAR JUNE SEPT MAR MAR JUNE SEPT MAR MAR JUNE SEPT MAR 2017 Source : Low Metal Bulletin 17

18 Revenue In millions of USD Fiscal years Quarters FY 2015 VOLUME MIX & METAL PRICE OTHER FY Q1 VOLUME MIX & METAL PRICE OTHER Q

19 Gross Margin Our revenue line is still impacted by GROSS MARGIN % underlying commodity prices. However, the moderate price stability in metals 22.4% 19.4% 23.1% supported by our selective approach focused on better margin products are showing substantial improvement to our gross margin. -7.2% FY 2015 FY Q1 Q

20 Adjusted EBITDA In millions of USD Fiscal years Quarters FY2014 FY2015 FY Q1 Q See Non-IFRS Measures 20

21 Net Debt Evolution In millions of USD 261 $(240) $(63) 137 Debt Reduction since 2011 Debt Reduction since Liquidity Dec. 31, March 31, MAR 2017 Cash and cash equivalent $24.3M $23.0M 21

22 FINANCIAL ROCE Fiscal years 15% 5% 8% 3% 9% 15% -6% -7% -48% -76% Q

23 Backup SPECIALTY METALS + CHEMICALS 23

24 Minor Metals 24

25 Some Facilities Montreal Lübeck Eisenhüttenstadt Tilly Shangyu St-George Kulim 5 25

26 Consolidated Product Offering Main Products Main Markets Bismuth (Bi) Chemicals Pure metal Low melting point alloys Pharmaceutical & cosmetics Pigments Coatings Glasses & others LMPA Optics & electronics Metallurgy Cadmium Telluride (CdTe) CdTe compound PV / Solar Optics and Detectors Gallium (Ga) Germanium (Ge) Indium (In) Selenium (Se) Tellurium (Te) Pure metal Chemicals PV / Solar LED/Display/Wireless Electronics Pure metal Semi-finished optical components Epi-ready substrates PV / Solar Optics and Detectors Pure metal Low melting point alloys Chemicals InSb substrates PV / Solar LED/Display/Wireless Optics and Detectors Electronics Pure metal Chemicals Metallurgy Fertilizers Animal feed Optics Electronics Pure metal Metallurgical alloys Optics and Detectors Electronics Metallurgical Typical Applications Active ingredient in a number of drugs, including Pepto-Bismol Replacement for lead in coatings, pigments, electronics, optics and glass Photo-receptive layer in thin-film solar modules Medical imaging devices White LED (GaN) Semiconductor for wireless devices and HF electronics (GaAs) Optoelectronics Specialty alloys Energy storage Biomedical devices CIGS solar cells ITO (conducting oxide) IR detectors Lenses for IR sensors Low melting-point alloys Substrates for very high Solders efficiency solar cells used CIGS solar cells in satellites Battery manufacturing Catalysts Catalysts Optical fibers Ceramics Fuel cells Catalyst for the production of electrolytic manganese IR optical glass Photo-receptive layer in thin-film solar modules Thermoelectric devices Infrared detectors Optical storage Annual Worldwide Production (1) 12,000 MT Cadmium only 20,000 MT 300 MT 100 MT 800 MT 4,000 MT MT (3) Comments #1 supplier of bismuth & bismuth chemicals worldwide 60%+ market share #1 supplier to CdTe market LT agreement with First Solar Important supplier of gallium and gallium chemicals, mainly in the LED industry 25%+ market share Significant producer of germanium substrates for satellite applications Important supplier for flat screen industry under Growing market share indium tin oxide (ITO) for selenium chemicals business #1 supplier of tellurium-based products 50%+ market 26 share

27 Key Customers by Applications Eco-Friendly Materials Business Unit Pharmaceutical & Cosmetic Anti-Corrosion Yellow Pigments Glass Frits LMPA Optics & Electronics Coatings 27

28 Key Customers by Applications Electronic Materials Business Unit CdTe Solar Cells LED/ Display Electronics/ Wireless Optics & Detectors Aerospace Thermoelectrics 28

29 5N Plus Applications Pharmaceutical LED Satellites Wireless electronics Co 2 lasers Solar Pigments Optical lenses Flat panel displays Medical imaging Soldering Batteries Animal food Optical storage Coating 29

30 Board of Directors SPECIALTY METALS + CHEMICALS 30

31 ARJANG (AJ) ROSHAN DIRECTOR SINCE FEBRUARY LUC BERTRAND CHAIRMAN - DIRECTOR SINCE JANUARY JEAN-MARIE BOURASSA DIRECTOR SINCE EMBER 2007 NATHALIE LE PROHON DIRECTOR SINCE MAY 2014 JENNIE S. HWANG DIRECTOR SINCE MAY 2014 JAMES T. FAHEY DIRECTOR SINCE MAY