- 1.Investor Presentation December 2010 AMG Advanced Metallurgical Group N.V.
2. Disclaimer THIS DOCUMENT IS STRICTLY CONFIDENTIAL AND IS BEING PROVIDED TO YOU SOLELY FOR YOUR INFORMATION BY AMGADVANCED METALLURGICAL GROUP N.V. (THE COMPANY) AND MAY NOT BE REPRODUCED IN ANY FORM OR FURTHERDISTRIBUTED TO ANY OTHER PERSON OR PUBLISHED, IN WHOLE OR IN PART, FOR ANY PURPOSE. FAILURE TO COMPLY WITHTHIS RESTRICTION MAY CONSTITUTE A VIOLATION OF APPLICABLE SECURITIES LAWS. This presentation does not constitute or form part of, and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquiresecurities of the Company or any of its subsidiaries nor should it or any part of it, nor the fact of its distribution, form the basis of, or be relied on in connectionwith, any contract or commitment whatsoever. This presentation has been prepared by, and is the sole responsibility of, the Company. This document, any presentation made in conjunction herewith and anyaccompanying materials are for information only and are not a prospectus, offering circular or admission document. This presentation does not form a part of,and should not be construed as, an offer, invitation or solicitation to subscribe for or purchase, or dispose of any of the securities of the companies mentionedin this presentation. These materials do not constitute an offer of securities for sale in the United States or an invitation or an offer to the public or form ofapplication to subscribe for securities. Neither this presentation nor anything contained herein shall form the basis of, or be relied on in connection with, anyoffer or commitment whatsoever. The information contained in this presentation has not been independently verified. No representation or warranty, expressor implied, is made as to, and no reliance should be placed on, the fairness, accuracy or completeness of the information or the opinions contained herein. TheCompany and its advisors are under no obligation to update or keep current the information contained in this presentation. To the extent allowed by law, noneof the Company or its affiliates, advisors or representatives accept any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from anyuse of this presentation or its contents or otherwise arising in connection with the presentation. Certain statements in this presentation constitute forward-looking statements, including statements regarding the Company's financial position, business strategy,plans and objectives of management for future operations. These statements, which contain the words "believe, expect, anticipate, intends, estimate,forecast, project, will, may, should and similar expressions, reflect the beliefs and expectations of the management board of directors of theCompany and are subject to risks and uncertainties that may cause actual results to differ materially. These risks and uncertainties include, among other factors,the achievement of the anticipated levels of profitability, growth, cost and synergy of the Companys recent acquisitions, the timely development and acceptanceof new products, the impact of competitive pricing, the ability to obtain necessary regulatory approvals, and the impact of general business and global economicconditions. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. Neither the Company, nor any of its respective agents, employees or advisors intend or have any duty or obligation to supplement, amend, update or revise anyof the forward-looking statements contained in this presentation. The information and opinions contained in this document are provided as at the date of this presentation and are subject to change without notice. This document has not been approved by any competent regulatory or supervisory authority. AMG ADVANCED METALLURGICAL GROUP N.V. 2 3. Introduction Listed on NYSE-Euronext Amsterdam (Euronext: AMG) Products High purity metals and complex metal products Vacuum furnaces used to produce high purity metals 2010 YTD September 30 2010 Revenues - $719.8 million EBITDA - $64.7 million, 9.0% margin EPS of $0.42 (1) Net debt - $144.6 million Capital Investment - $19.1 million Global presence Europe, North America, South America and Asia 2,500 employeesSustainable Metals Technology (1) Excluding the equity losses from AMGs 42.5% ownership in Timminco Limited AMG ADVANCED METALLURGICAL GROUP N.V. 3 4. Macroeconomic Trends and Markets AMG participates in the macro economic trend of: Growing demand for natural resources in context of CO2 reduction and sustainable environmental demands for: Responsible energy production and use Emerging market infrastructure Aerospace and light weight materials Specialty metals and chemicalsAMG ADVANCED METALLURGICAL GROUP N.V. 4 5. Products & Markets Advanced Materials Engineering Systems High-value alloys Capital equipment for high purity Essential raw materials materials Specialty Metals & EnergyAerospace Infrastructure ChemicalsAMG ADVANCED METALLURGICAL GROUP N.V. 5 6. MarketsAMG Advanced Metallurgical Group N.V. Specialty Metals &AerospaceInfrastructureEnergyChemicalsTitanium Alloys Structural SteelSolar Vacuum FurnacesSilicones SuperalloysSpecialty Steel Superalloys Paints & Pigments Turbine Coatings Building Materials Silicon Metal Glass, Tools & OpticsVacuum FurnacesNuclear Fuel Vaccum FurnacesCapacitorsEnergy Storage Technologies AMG ADVANCED METALLURGICAL GROUP N.V. 6 7. ProductsAerospace Infrastructure Recycling Ti alloys(includes VAl) SuperalloysHigh purity stainless steelTypical aerospace jet engine Energy Solar & Nuclear Specialty Metals & ChemicalsStackable GraphiteBlocks Tantalum based capacitor Paints and pigments Vacuum furnaces for solar ingotproduction AMG ADVANCED METALLURGICAL GROUP N.V. 7 8. Markets & Products by the Numbers YTD 2010 Revenue by YTD 2010 Revenue byEnd MarketProductTantalum &Graphite 5% Niobium4% ChromiumMetal 8%Aerospace 26%Vacuum Furnaces25%Specialty Metals & Chemicals 36% Antimony 11%FeV & FeNiMoEnergy - Solar &8% Nuclear 22%Al Master Alloys 14%Si Metal 9% Infrastructure 16% Ti Master Alloysand Coatings16% AMG ADVANCED METALLURGICAL GROUP N.V. 8 9. Advanced Materials - Market, Products and CustomersAerospaceInfrastructure - FeV Specialty MetalsProducts Specialty alloys for titanium Ferro-vanadium Chromium Metals Coatings for wear Ferro-nickel molybdenum Tantalum resistance Antimony Aluminium master alloys Competitors Reading Alloys Inc. Evraz Group S.A. (Highveld KBM Affilips B.V. Steel & Vanadium) Evraz Group S.A. KB Alloys, Inc. (Stratcor) Eramet S.A. (Gulf Chemical Delachaux S.A. & Metallurgical Corporation Campine S.A. Evraz Group S.A. (Stratcor) Chemtura Corporation Xstrata plc Chengde Vanadium & Titanium Stock Co. Ltd. Sample CustomersAMG ADVANCED METALLURGICAL GROUP N.V. 9 10. Advanced Materials Specialty Metals AcquisitionMaterial Antimony AMG is the largest producer of antimony trioxide (a flame retardant) in Europe Transaction In August 2010 AMG acquired antimony mining rights and an adjacent antimony metal smelter in Turkey for a total investment of up to approximately $20 million Strategic Secure supply of antimony raw material used in AMGs antimony trioxide operation Rationale AMG uses approximately 10,000 mt of antimony metal per year Antimony metal prices have increased from $4,500/mt in 2009 to over $10,000/mt in October 2010 This will result in substantial raw material cost savings in 2011Competitors Campine S.A., Chemtura Corporation, Hsikwangshan Twinkling Star Antimony Co. LtdAntimony MetalOxidationAntimony Dispersions, Pastes, PurchaseProcess Trioxide Granules, MicrogranulesAMG ADVANCED METALLURGICAL GROUP N.V. 10 11. Advanced Materials - Infrastructure metals pricing $60$250$50Price / Pound V, Mo, Ni$200$40 $150$30 $100$20$10 $50 $0 $0 2000 2001200220032004 2005 20062007 20082009 2010 Ferro VanadiumMolybdenum Nickel Prices are still below pre-crisis levels AMG ADVANCED METALLURGICAL GROUP N.V. 11 12. Engineering Systems - Market, Products and Customers Energy - SolarAerospace Energy - Nuclear Solar silicon melting and Vacuum Melting and Re- Vacuum Sintering Productscrystallisation systems melting SystemsSystems(DSS furnaces) Precision Casting andCoating Systems Heat Treatment with highpressure gas quenching Notable Successes 2005 Introduced single 2010 Market Share leader Secured first nuclearcrucible furnaces in Ti remelting in China, theengineering contract withfastest growing Ti marketDOE, through Shaw-Areva 2005 2009 >$172 mmin revenue, 2nd largest 2010 Leading market share Two strategic acquisitionsmarket participantin turbine blade coating completed to expand product portfolio 2010 Introduced SCU600+ DSS systemSample Customers AMG ADVANCED METALLURGICAL GROUP N.V. 12 13. Financial OverviewAMG ADVANCED METALLURGICAL GROUP N.V. 13 14. Financial Highlights YTD September 20102010 YTD Revenue2010 YTD EBITDA$719.8$64.7 $5.1$94.4 $178.0$27.5$32.1$447.4Revenue by GeographyAdvanced MaterialsEngineering SystemsAdvanced MaterialsEngineering Systems Graphit KropfmhlGraphit Kropfmhl NorthAmerica21% Asia18% Europe56%South America 4% ROW1% Revenue and EBITDA in millions AMG ADVANCED METALLURGICAL GROUP N.V. 14 15. Financial Highlights Revenue Highlights (in millions) Q3 Revenue: $240.4 million Up 17% from Q3 2009 Q3 EBITDA: $18.8 million $243.5$231.4 $235.8 $240.4 Up 1% from Q3 2009$205.4 Q3 EPS: $0.11 Up from ($0.50) in Q3 2009Q3 09 Q4 09 Q1 10Q2 10Q3 10 EBITDA (in millions) YTD Revenue: $719.8 million Up 13% from YTD 2009 YTD EBITDA: $64.7 million $23.9 Up 14% from YTD 2009$22.0 $18.6$18.8 $12.4 YTD EPS: $0.42 (1)--- Up from ($0.65) YTD 2009 (1)Q3 09Q4 09Q1 10Q2 10Q3 10 (1) Excluding the equity losses from AMGs 42.5% ownership in Timminco LimitedAMG ADVANCED