Q1 Interim report 2018

Transcription

1 Click to edit Master text styles Second level Third level Fourth level Fifth level Q1 Interim report 218 Lennart Evrell President & CEO Håkan Gabrielsson CFO

2 Q1 Interim report 218 High grades in Aitik and Tara Revenues 13,331 (12,73) MSEK EBIT ex PIR* 2,724 (2,61) MSEK Free Cash Flow 1,431 (1,6) MSEK Net Debt /Equity decreased from 11% to 6% during Q1 High grades compensated for low milled production New crusher in Aitik under commissioning Good safety performance MSEK Expansion Garpenberg Acquisition Kylylahti Acquisition Kevitsa Aitik high grades R4Q, MSEK Quarterly EBIT excl PIR* Rolling 4Q EBIT Rolling Q EBIT excl PIR* * PIR=Process Inventory Revaluation Boliden Group Q

3 Market Q1 218 supportive macro, high metal prices Macro Strong business climate Construction growth improved Auto production growth declined Base metals High copper and nickel demand growth Low zinc demand growth Metal prices volatile Zn and Ni metal deficit Copper metal surplus Zn concentrate market remained tight Cu concentrate market in balance Loading Zinc in Kokkola Boliden Group Q

4 Base metal prices Copper price, USD/tonne 12 Copper KTonnes 2 4 Zinc price, USD/tonne 4 Zinc KTonnes LME inventory COMEX inventory Shanghai inventory Price Price Q avg LME inventory Shanghai inventory Price Price Q avg Nickel price, USD/tonne Nickel KTonnes Average price in Q1 vs. period Q4-17 Q3-17 Q2-17 Q1-17 Copper 2% 1% 23% 19% 15 3 Zinc 6% 15% 32% 23% 1 2 Nickel 15% 26% 44% 29% LME inventory Price Price Q avg Note: Prices until 24 April 218 Boliden Group Q

5 High Cu and Zn prices relative to cash cost USD/tonne 5 Zinc Copper Nickel USD/tonne USD/tonne USD/tonne USD/tonne USD/tonne Zn average price Zn min price 75th perc Zn max price 5th perc 9th perc Cu average price Cu min price 75th perc Cu max price 5th perc 9th perc Ni average price Ni min price 75th perc Ni max price 9th perc 5th perc Source: Wood Mackenzie 218 Normal C1 cash cost*, Thomson Reuters Datastream April 24, 218 * Normal C1 cash cost: cash operating cost, freight cost, treatment and refining charges, less value of by-metal products Boliden Group Q

6 Boliden market term index Click to edit Master text styles Second level Third level Fourth level Fifth level Note: Index 1 = 1 January 213 Boliden Group Q

7 Click to edit Master text styles Second level Third level Fourth level Fifth level Mines Satellite pit in Aitik Boliden Group Q

8 Q1 218 Mines High metal production, high prices EBIT 1,931 (1,525) MSEK 2,179 MSEK in Q4 217 Capex 878 (755) MSEK MSEK R4Q, MSEK Improved EBIT - High metal production & market terms Aitik High grades in Q1 Increased grade guidance 218 Low milled volume Quarterly EBIT Rolling 4Q EBIT Crusher under commissioning High grades in Tara Winter conditions Boliden Group Q

9 Mines Production Milled ore, Mtonnes 16 Copper Metal content, Ktonnes 48 Milled ore, Mtonnes 2, Zinc Metal content, Ktonnes , , , ,4 2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Milled ore Metal content pro forma** Metal content Nickel Milled ore, Mtonnes Metal content, Ktonnes 3,2 4, 2,8 3,5 2,4 3, 2, 2,5 1,6 2, 1,2 1,5,8 1,,4,5,, Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Milled ore pro forma* Milled ore Metal content pro forma** Metal content, Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Milled ore Metal content Cu production 37 (3) kton High grades in Aitik Production disturbances in Aitik Zn production 78 (77) kton Low volume and high grades in Tara Low grades in Garpenberg Ni production 3.5 (3.3) kton Stable production at Kevitsa Hard ore in Kevitsa (*) Milled ore incl Kevitsa (**) Metal content incl Kevitsa Boliden Group Q

10 Click to edit Master text styles Second level Third level Fourth level Fifth level Smelters Harjavalta nickel matte station Boliden Group Q

11 Q1 218 Smelters Stable production EBIT ex PIR* 64 (835) MSEK 766 MSEK in Q4 217 Capex 231 (341) MSEK MSEK R4Q, MSEK Weaker market terms despite higher metal prices Stable production and high free metals in Copper Smelters High zinc production One-off cost 5 MSEK Fire in Bergsöe Quarterly EBIT excl PIR* Rolling 4Q EBIT Rolling 4Q EBIT excl PIR* * PIR=Process Inventory Revaluation Boliden Group Q

12 Smelters Production Cu production 92 (89) ktonnes Increased production in both smelters Production record in Harjavalta 46% (37) internal feed Total feed, Ktonnes Copper Metal production, Ktonnes Zn production 12 (115) ktonnes Improved process stability in Kokkola Poor raw-material mix Odda production at design capacity Ni in matte production 8.4 (7.6) ktonnes Production stability improved 1 5 Total feed, Ktonnes Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Feed, total Zinc Metal production 3 15 Metal production, Ktonnes Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Feed, total Metal production Boliden Group Q

13 Click to edit Master text styles Second level Third level Fourth level Fifth level Financials 4,5 ton gold produced in Q1 218 Boliden Group Q

14 218 Q1 Earnings MSEK Q1 218 Q1 217 Q4 217 Revenues 13,331 12,73 13,619 EBITDA 3,941 3,241 4,332 EBIT 2,672 2,149 3,91 EBIT ex PIR 2,724 2,61 2,912 Investments 1,19 1,96 1,867 Free cash flow 1,431 1,6 2,382 Earnings per share, SEK Net debt / equity ratio Boliden Group Q

15 218 Q1 vs. 217 Q1 Group EBIT excl. PIR MSEK Q ,724 Q ,61 Deviation 663 Specification of deviation Volumes 944 Prices and Terms (incl. hedges) 9 Whereof currency -796 Costs -124 Depreciation -19 Items affecting comparability -5 Other -8 Deviation 663 High grades in Mines, higher free metal in Smelters Positive effect from metal prices, offset by negative FX & TC Higher metal production in Mines Fire in Bergsöe Boliden Group Q

16 218 Q1 vs. 217 Q4 Group EBIT excl. PIR MSEK Q ,724 Q ,912 Deviation -187 Specification of deviation Volumes -169 Prices and Terms (incl. hedges) -125 Whereof currency effects -151 Costs 114 Depreciation 31 Items affecting comparability -5 Other 11 Deviation -187 Higher grades, less milled production in Mines Negative FX effect; USD lower and EUR stronger Decreased volumes Lower metal production in Mines Boliden Group Q

17 Cash flow MSEK Q1 218 Q1 217 Q4 217 EBITDA excluding PIR 3,994 3,154 4,152 Cash flow from working capital Inventories Operating receivables Operating liabilities Other Cash flow from investments -1, ,875 Financial items Tax paid Other Free cash flow 1,431 1,6 2,382 Boliden Group Q

18 Balance sheet SEK bn 31 Mar Mar Dec 217 Total Assets Capital employed Equity Net debt Net debt / equity ratio Loan duration, years Average interest rate, % MSEK Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q % Interest duration, years Net debt Gearing Net payment capacity Boliden Group Q

19 Going forward Aitik New crusher ramp-up volatile production Q2-Q4 218: Cu.26% 219: Cu.25% Garpenberg Low Zn grades and high Ag grades in Q1 218: Zn 4.%, Ag 115 g/tonne High grades Q1 in Tara Winter conditions, continued into Q2 218 benchmark Zn TC not settled Positive internal profit elimination in Q1 Planned Maintenance Smelters 218: -2 (-415) MSEK* Aitik crusher under construction Q2: -13 (-26) MSEK Q3: -7 (-5) MSEK Capex: 218 slightly above 6 BSEK * EBIT impact Boliden Group Q

20 Conclusion Q1 report 218 Well positioned in the metal market Mines and smelters Base metals and precious metals High productivity Strong balance sheet High grades Stable smelter production New crusher in Aitik under commissioning World-class productivity in underground and open-pit mines Boliden Group Q

21 Disclaimer This presentation has been prepared by Boliden for information purposes only and as per the indicated date. Boliden does not undertake any obligation to correct or update the information or any statements made therein. Certain statements in this presentation are forward-looking and are subject to risks and uncertainties. Nothing contained herein shall constitute any representation or warranty as to accuracy or completeness. Boliden has not made any independent verification of the information obtained from third parties. Nothing in this material shall be construed as an offer or solicitation to buy or sell any security or product, or to engage in or refrain from engaging in any transaction. Boliden does not accept any liability whatsoever arising from or in connection with the use of this information. Save as by prior approval in writing, this material may not be copied, transmitted or disclosed, whether in print, electronic or any other format. All rights to the material are reserved. Boliden Group Q

22 Click to edit Master text styles Second level Third level Fourth level Fifth level Boliden Group Q

23 Click to edit Master text styles Second level Third level Fourth level Fifth level Appendix Boliden Group Q

24 Zinc price Zinc price, USD/tonne 4 KTonnes 2 USD/tonne 3 9 Q1 Q4 Q3 Q2 Q jan-17 apr-17 jul-17 okt-17 jan-18 apr LME inventory Shanghai inventory Price Price Q avg 4 Average price in Q1 vs. period Q4-17 Q3-17 Q2-17 Q1-17 6% 15% 32% 23% Note: Prices until 24 April 218 Boliden Group Q

25 Copper price Copper price, USD/tonne 12 KTonnes 2 4 USD/tonne Q1 Q4 Q3 Q2 Q jan-17 apr-17 jul-17 okt-17 jan-18 apr LME inventory COMEX inventory Shanghai inventory Price Price Q avg 4 Average price in Q1 vs. period Q4-17 Q3-17 Q2-17 Q1-17 2% 1% 23% 19% Note: Prices until 24 April 218 Boliden Group Q

26 Nickel price Nickel price, USD/tonne 35 KTonnes 6 USD/tonne 18 Q1 Q4 Q3 Q2 Q jan-17 apr-17 jul-17 okt-17 jan-18 apr LME inventory Price Price Q avg 1 Average price in Q1 vs. period Q4-17 Q3-17 Q2-17 Q % 26% 44% 29% Note: Prices until 24 April 218 Boliden Group Q

27 Gold, silver and lead prices Gold price, USD/troy oz Gold Silver price, USD/troy oz Silver Lead price, USD/tonne 5 Lead Average price in Q1 vs. period Q4-17 Q3-17 Q2-17 Q1-17 Gold 4% 4% 6% 9% Silver % % -3% -4% Lead 1% 8% 17% 11% Note: Prices until 24 April 218 Boliden Group Q

28 Market balance zinc and copper Zinc global market Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Metals demand, kt Year on year change 3,% 3,% 2,6% 2,4% 3,1% 3,% 1,3% 1,5% Smelter production, kt Year on year change -4,6% -1,2% 3,%,6% -1,1% -3,1% -1,% 2,6% Mine production, kt Year on year change -15,6% -1,4% 4,9% 9,6% 6,2% 2,4%,5%,9% Metal balance, kt Concentrate balance, kt Copper global market Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Metals demand, kt Year on year change 3,6% 2,1% 3,1% 2,3% 2,% 2,4% 2,7% 4,1% Smelter production, kt Year on year change 2,5% 1,5% 1,7% -,1% -1,% 2,3% 4,4% 4,% Mine production (concentrate), kt Year on year change 6,6% 7,2% 7,5% -2,9% -,1% 3,5%,7% 7,7% Metal balance, kt Concentrate balance, kt Source: February-March 218, Boliden calculations Boliden Group Q

29 Market balance nickel and lead Nickel - global market Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Metals demand, kt Year on year change 9,3% 8,% 13,2% 6,4% -1,7% 11,4% 8,9% 11,9% Smelter production, kt Year on year change 1,% 1,8% 3,8% 3,6% -4,8% 8,1% 6,3% 11,9% Mine production, kt Year on year change -3,3%,7% 6,1% -2,5% 6,2% 13,1% 13,7% 2,% Metal balance, kt Lead - global market Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Metals demand, kt Year on year change 3,1% 3,7% 3,% 2,% 1,7% 1,3% 1,7% 2,3% Smelter production, kt Year on year change 3,9% 2,7% -,2%,2% 1,3% -,1% 1,2% 1,9% Mine production, kt Year on year change -4,3% -3,4% -3,4%,% -2,% -2,1% -1,% 3,2% Metal balance, kt Concentrate balance, kt Source: February-March 218, Boliden calculations Boliden Group Q

30 Zinc TC and premia US$/t concentrate 3 Treatment charges US$/t metal 25 Metal premia Realized TC - European contract" Ex-Works Premia Europe Spot TC - China imports Delivered Premia US Midwest Premia Far East - Western Contract benchmark according to market sources including CRU No benchmark for 218 Spot TC in China remained low Metal available in Europe Low spot market activity Stable spot premiums Source: CRU 218 Boliden Group Q

31 Copper TC and premia US$/t concentrat e 12 Treatment charges US$/t metal 16 Metal premia Contract TC - annual and mid-year benchmark CIF European benchmark premia Standard grade spot TC CIF Average European premia Contract benchmark according to market sources including CRU Low spot market activity, higher in March Spot TC down below benchmark Good metals demand in Europe Spot premia up slightly Source: CRU 218 Boliden Group Q

32 Economic development Industrial production, year on year % J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D EU28 USA China World Source: Thomson Reuters Datastream, world data calculated by Boliden Boliden Group Q

33 Construction largest segment for Cu and Zn Activity, year on year % J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D EU USA China China: year on year based on cumulative investments at each point. USA: construction spending. EU: construction production Source: Reuters Datastream Boliden Group Q

34 Automotive modest growth Production of light vehicles, year on year, quarterly data 35% 3% 25% 2% 15% 1% 5% % -5% -1% -15% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Europe North America China World Source: LMC Automotive Boliden Group Q

35 China metals demand and economic growth Year on year growth % Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Zinc demand Copper demand Nickel demand GDP growth % Industrial production growth % Source: CRU Ltd, Thomson Reuters Datastream Boliden Group Q

36 Click to edit Master text styles Second level Third level Fourth level Fifth level Boliden Group Q