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DISCLAIMER
These preliminary materials and any accompanying oral presentation (together, the “Materials”) have been prepared by Mytilineos Holdings SA (the “Company”) and are intended solely for the information of the Recipient. The Materials are in draft form and the analyses and conclusions contained in the Materials are preliminary in nature and subject to further investigation and analysis. The Materials are not intended to provide any definitive advice or opinion of any kind and the Materials should not be relied on for any purpose. The Materials may not be reproduced, in whole or in part, nor summarised, excerpted from, quoted or otherwise publicly referred to, nor discussed with or disclosed to anyone else without the prior written consent of the Company.
The Company has not verified any of the information provided to it for the purpose of preparing the Materials and no representation or warranty, express or implied, is made and no responsibility is or will be accepted by the Company as to or in relation to the accuracy, reliability or completeness of any such information. The conclusions contained in the Materials constitute the Company’s preliminary views as of the date of the Materials and are based solely on the information received by it up to the date hereof. The information included in this document may be subject to change and the Company has no obligation to update any information given in this report. The Recipient will be solely responsible for conducting its own assessment of the information set out in the Materials and for the underlying business decision to effect any transaction recommended by, or arising out of, the Materials. The Company has not had made an independent evaluation or appraisal of the shares, assets or liabilities (contingent or otherwise) of the Company .
All projections and forecasts in the Materials are preliminary illustrative exercises using the assumptions described herein, which assumptions may or may not prove to be correct. The actual outcome may be materially affected by changes in economic and other circumstances which cannot be foreseen. No representation or warranty is made that any estimate contained herein will be achieved.
3
Group Overview
Financial Review
Areas of ActivityMetallurgy & Mining EnergyEngineering Procurement Construction (EPC)
Stock Data
Summary
AGENDA
5
GROUP’S CORPORATE STRUCTURE
Source: Company Information.Note: Market data 10 June 2010.METKA is the only remaining listed subsidiary.
MYTILINEOS HOLDINGS
METKA(57.4)
ALUMINA & ALUMINIUM(100%)
METALLURGY & MINING
ENERGY EPC
ENDESA (HELLAS) (100%)
DELPHI DISTOMON (100%)
Mkt Cap*: € 484 mn
Mkt Cap*: € 451 mn
KORINTHOS POWER (65%)
Mytilineos Group holds a 43% stake in the state owned Vehicle Manufacturing company ELVO. This is considered a non core sector activity and is consolidated through equity.
7
Balance Sheet FY09 FY08
Non Current Assets 1,135 902
Current Assets 853 868
Total Assets 1,989 1,770
Debt 650 411
Cash Position 219 44
Marketable Securities 58 42
Equity 764 901
Adj. Equity 896 943
Net Debt 431 367
Adj. Net Debt 373 325
837
913 929
662
154110 119
747
311
18715842
20
256
157211
29 20
22.3%
18.0%
13.5%
21.2%
16.9%
11.8%
0
100
200
300
400
500
600
700
800
900
1,000
2004 2005 2006 2007 2008 20090.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Turnover EBITDA EAT EBITDA%
FINANCIAL REVIEW
Financial Performance
Source: Company Information.
2010 Key Performance Drivers:
Metal and Currency hedges boost top line and profitability.
Favorable $ and commodities prices.
Strong Growth from the EPC sector.
Liberalization of Natural Gas Market (including LNG).
Higher Electricity Pool Prices since the onset of the financial crisis in 2008.
9
M & M – BUSINESS OUTLOOK
Entire complex acquired from Alcan in 2004. Leading industrial producer of alumina and aluminium in South Eastern Europe.
Production facilities occupy an area of 7,035,700m2 and constitute a vertically integrated production unit including bauxite mines, alumina refinery, smelter and self owned port facilities for large tonnage ships.
Low cost production base in Europe both for Alumina and Aluminium – below average global cost.
Enough alumina to cover own aluminium production needs and to export half a million tonnes per annum.
10-year export contract with Glencore AG regarding the majority of excess alumina production.
Steam is produced using Natural Gas by the 334 MW CHP Plant, 100% owned by Mytilineos Group.
Exploitation of bauxite reserves by the 100% owned subsidiary Delphes – Distomon S.A. covering more than half of its Bauxite requirements. Long term contracts with other suppliers (Alcan, S&B, Glencore AG).
Efficient risk management strategy. The Group acting proactively secured Aluminum sales in prices well above current market levels for 2009 and 2010.
Alumina & AluminumBusiness Overview Operational & Financial Overview
Key Strengths
Source: Company Information.
788,900 771,769718,797
164,500 168,000 162,339 134,738
780,000782,000
165,300
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
2005 2006 2007 2008 2009
tn OX AL
471429
73 49 6652 77 37 20 49
469382
471
79110
15.4%
10.4%
23.4%
20.7%
15.5%
0
50
100
150
200
250
300
350
400
450
500
2005 2006 2007 2008 2009
€ mil
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Turnover EBITDA EAT % EBITDA
10
2009 ALUMINIUM SMELTER INDUSTRY COST DATA
0
400
800
1,200
1,600
2,000
2,400
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000
Production (kt)
Co
st
($/
t A
l)
M & M – BUSINESS OUTLOOK
Source: Company Information, CRU ANALYSIS, Brook Hunt & Associates Ltd.
Aluminum Cost Analysis
Total Market
Other Raw Materials Cost 13%
Average Delivered
Alumina Cost 33%
Total Other Costs 9%
Labour Cost 7%
Total Energy Cost 38%
Electricity Rates:
AoG and PPC currently negotiate the terms under which PPC will supply electricity power to AoG to cover fully or partly its needs.
Negotiations between the two parties have reached the final stage and point at the direction of finding a mutually beneficiary solution.
Currently the PPC tariff for industrial consumption during the night stands at c. 31 -33€/MWh, while the average SMP in the 1st
Quarter of 2010 settled at 46 €/MWh.
12
Monthly SMP data 2008 – 2010 (EUR)
0
10
20
30
40
50
60
70
80
90
100
110
January
FebruaryMarch April May
June JulyAugust
SeptemberOctob
er
November
December
2008 2009 2010
Source: Company Information, HTSO.
ENERGY - INDUSTRY & MACRO ENVIRONMENT
Electricity Market:
The Greek electricity market (Demand peak c. 10 GW) is under liberalization. Most of the existing capacity is old and inefficient, underlining the need for new capacity and replacements.
Dominant position of PPC to be challenged by IPPs (MYTILINEOS- MOTOR OIL, TERNA - GDF, HELPE – EDISON).
Inefficient fuel supply-mix, over 60% derived from Lignite.
Expensive imports. During the summer the system realizes power shortages.
All the new conventional capacity up to 2014 will be based on Natural Gas. During 2010 IPPs are expected to launch 3 new CCGTs with total capacity of 1.3 GW.
Renewable generation is also set to rise as a very favorable framework has been put into place. Feed-in tariff for the energy and up to 40% subsidy for construction of wind and solar parks.
Natural Gas could become base load post 2013, when CO2 free allowances will be abolished.
AVG 2009: 47.4
AVG 2008: 87.2
13
Energy Market – Developments in 1Q 2010
Total Power demand during 1st Q 2010: 12.7 m MWh (down 3.3% y-o-y).
Lignite production decreased by 17.8% while Hydro production reached 2.6 m MWh (up 112.6% y-o-y).
Natural Gas production also increased at 2 m MWh (up 24.3% y-o-y).
Average SMP decreased at 46.1 €/MWh (down 18.3% y-o-y), however higher Oil prices are expected to put an upward
pressure on the SMP during the rest of the year.
The CHP plant, fully owned by Mytilineos Group, has already supplied the Grid with over 1.3 m MWh since April
2009 – full commercial operation of the plant is imminent and subject only to the completion of the new
electricity codes.
0
10
20
30
40
50
60
70
80
90
1 2 3 4 5
ENERGY - INDUSTRY & MACRO ENVIRONMENT
The Greek Electricity Market
Source: Company Information, HTSO.
Marg
inal
cost
(€
/M
Wh
)
Hydro, RES Lignite Gas CCGT Gas OCGT Fuel oil
Merit Order, 2010Power Production Mix
Total Production 2009: 48.5 m MWh
63.0%3.5%
19.4%
10.2%3.9%
LIGNITE OIL N.G. HYDRO RENEWABLES
1 4.2 9.5 11.8 13.112.3Installed capacity (in GW)
14
Source: Company Information(1) The CHP is under commissioning and commercial operations is expected
to commence as soon as the new electricity code is completed.
Group total installed capacity attributable to
thermal generation assets is expected to
reach c. 1.2GW by 2011
Mytilineos, expects to commission 2 thermal
power plants until 2011 (one in late 2010 and
one in mid 2011)
The Viotia CCGT is under construction, with the EPC c. 80% completed while construction for
the Korinthos Power CCGT started in
September 2009
Thermal Asset Summary
CHP 334MW 20101 Viotia 191 In operation
Korinthos Power 436.6MW August 2011 Korinthos 290
Viotia CCGT 444.4MW November 2010 Viotia 242Final Stage
of construction
RES Asset Summary
Operational
Gross MW
Attr. MW
Installation Licenses
Gross MW
Attr. MW
Production Licenses
Gross MW
Attr. MW
Applications
Gross MW
Attr. MW
Total
Gross MW
Attr. MW
Wind 35.60 32.23 11.50 5.64 166.40 122.45 1,124.90 1,053.17 1,338.40 1,213.49
Hydro 6.06 2.69 1.90 1.71 49.51 44.70 11.29 2.16 68.76 51.26
PV 0 0 0 0 0 0 30.60 27.72 30.60 27.72
Under construction
ENERGY - BUSINESS OUTLOOK
Installed capacity CommentsTotal capex
(Eur mn)LocationCommercial
operation
15Source: Company Information, Bloomberg, Credit Suisse.
GAS MARKET - BUSINESS OUTLOOK
Gas vs Oil PricesGAS MARKET DEVELOPMENTS:
In 2009 Mytilineos Group & MOTOR OIL joined forces in the Natural Gas Market.
Liberalization of Natural Gas Market (including LNG).
Gas Prices have decoupled from the price of Oil. Today LNG is priced aprox. 45% lower compared to the Oil linked pipeline Gas supplied by DEPA.
Following the recent acquisition by the Group of the 50.01% owned by ENEL in ENDESA HELLAS, the Group will operate 1.2 GW by 2011, thus extending its natural gas needs up to 1 bcm.
The opening of the LNG market offers a competitive advantage for the Group that has not been engaged in a long term Gas supply contract for its new CCGT’s.
LNG global capacity reaches 11% of total natural gas supply. 2010 forecasts call for another 7-8 bcf/d to come online (+22.7%).
17
EPC – BUSINESS OUTLOOK
METKABusiness Overview Financial Overview
Key Strengths
• Significant international presence. World class manufacturing capability with high value-added profile.
• Strong demand from developing countries.
• Strong backlog currently at €2.0 bn – Earnings Visibility & Stability.
• High cash flow generation.
• Close ties with all world-class technology providers, including GE, Alstom, Siemens etc.
• Three state-of-the-art industrial facilities with 790 highly skilled and experienced personnel with excellent know-how.
Source: Company Information.
METKA S.A., 57.4% owned by Mytilineos Holdings, is a leading EPC Contractor with international profile.
Listed in the Athens Stock Exchange (ASE) since 1973.
METKA is involved in:
– Energy
» Complete power plants: engineering, procurement, construction (EPC) scope.
» EPC Contractor or consortium with technology suppliers.
– Infrastructure
» Focus on technically demanding infrastructure applications.
» Complex steel structures, mining & minerals, port equipment, refinery & petrochemical.
– Defence
» Manufacturing co-production with defence majors.
» Land defence systems. Major supplier of the Hellenic Armed Forces.
Turnover Analysis
212 196
297 283
48 61 5233 42 40 23 4
165
41270
50
100
150
200
250
300
350
2005 2006 2007 2008 2009
€ milEnergy Infrustructure Defence
284
381339
57 67 6137 41 37 45 37
225
295
54 61
17.9%17.5%
20.7%
24.0%
20.1%
0
50
100
150
200
250
300
350
400
450
2005 2006 2007 2008 2009
€ mil.
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
Turnover EBITDA EAT % EBITDA
18
PPC4%
PROJECTS ABROAD
85%
OTHER2%
MYTILINEOS GROUP
9%
EPC - BACKLOG
Source: Company Information.
€2.0 bn
Strong Backlog – Visibility – International Profile
PPC: 417 MW in Aliveri, Natural Gas Fired combined cycle. Alstom sub supplier
for the main equipment. Contract value of €219 m.
Mytilineos Group : 430 MW in Ag. Nikolaos, Natural Gas Fired combined cycle.
GE sub supplier for the main equipment. Contract value of €232 m.
Commissioning: 2nd half 2010.
OMV PETROM: 860 MW in Romania, Natural Gas Fired combined cycle. 50-50
Consortium with GE. Contract value of €210 m.
PEEGT: 700 MW in Syria, Natural Gas Fired combined cycle. METKA leader of
Consortium with Ansaldo. Contract value of €650 m.
KORINTHOS POWER: 437 MW in Ag. Theodoroi, Natural Gas Fired combined
cycle. GE sub supplier for the main equipment. Contract value of €285 m.
Commissioning: 1st half 2011.
RWE & Turcas Güney Elektrik Uretim A. Ş. : 775 MW in Turkey, Natural Gas
Fired combined cycle. Siemens sub supplier for the main equipment. Contract
value of €450 m.
OMV (BORASCO): 870 MW in Turkey, Natural Gas Fired combined cycle. GE sub
supplier for the main equipment. Contract value of €475 m.
Backlog - Sales Evolution
230
605
1,460
2,090
165 212 196 297 283
450339381
284295225
0
500
1,000
1,500
2,000
2005 2006 2007 2008 2009
€ mil
Backlog Evolution Group Sales of which EPC Sales
19
METKA INVESTMENT CASE SUMMARY
Well positioned to benefit from the expansion in new very promising markets such as Turkey & the Middle East.
Strong Backlog - Highly visible cash flows over the next years.
International exposure – neutral investment case against the domestic environment.
The highest EBITDA margin against its peers.
Growth momentum - Sales expected to double over the next couple of years.
Quality Balance Sheet.
METKA Investment Highlights
Source: Company Information.
21
STOCK DATA – MYTILINEOS HOLDINGS S.A.
Share Price Information
Market Cap: € 484 mnAvg. Trading Value: € 1.5 mnTotal No of shares: 116,984,338Free Float: 61%Listing FTSE/ASE 20 FTSE
INTERNATIONAL, MSCI Small Cap and HSBC Small Cap
Notes: Data as of 10 June 2010.Source: Company Information.
Stock Symbols
ASE: MYTILReuters: MYTr.ATBloomberg: MYTIL GA
Shareholder Structure
Stock Performance
Mytilineos
Family 30.3% Retail 31.9%
Greek Institutional
Investors 11.4%
Foreign Institutional
Investors 17.5%
Treasury
Stock 8.9%
60
70
80
90
100
110
120
31/12/2009 30/1/2010 1/3/2010 31/3/2010 30/4/2010 30/5/2010
Mytilineos Group Athex Composite
22
STOCK DATA – METKA S.A.
Share Price Information
Market Cap: € 451 mnAvg. Trading Value: € 0.5 mnTotal No of shares: 51,950,600Free Float: 42.7%Listing FTSE/ASE Mid-40,FTSE
INTERNATIONAL,MSCI Small Capand HSBC Small Cap
Stock Symbols
ASE: METKReuters: MTKr.ATBloomberg: METTK GA
Shareholder Structure
Mytilineos Holdings57.4%
Retail 10.5%
Greek Institutional Investors 12.6%
Foreign Institutional Investors 19.1%
Notes: Data as of 10 June 2010.Source: Company Information.
60
70
80
90
100
110
120
31/12/2009 30/1/2010 1/3/2010 31/3/2010 30/4/2010 30/5/2010
Metka Athex Composite
Stock Performance
24
SUMMARY
The Group is well placed to benefit from:
The liberalization of the domestic energy market.
The establishment of METKA as one of the most reliable EPC players in Europe.
The Recovery of Commodity Prices as the world economy improves.
Strong exposure abroad, neutralizing the impact of the adverse domestic economic environment.
Strong EPC business through METKA, which offers highly visible cash flows and is well positioned to benefit from the expansion in new very promising markets.
Fully Integrated model in Alumina - Aluminium business, self owned bauxite mines and the operation of the CHP plant offer solid control of the main cost parameters.
High Liquidity and secured funding for the execution of the Group’s demanding investment plan.
Effective risk management against FX and Commodities price fluctuations secures medium term profitability supporting also Cash flows.
Successful management’s track record in value creation through a series of value enhancing deals.
Investment Highlights
Source: Company Information.
25
CONTACT INFORMATION
Dimitris KatralisInvestor Relations DepartmentEmail:[email protected]: +30-210-6877476Fax: +30-210-6877400
Mytilineos Holdings S.A.5-7 Patroklou Str.15125 MaroussiAthensGreeceTel: +30-210-6877300Fax: +30-210-6877400
www.mytilineos.grwww.metka.gr