HPSA presentation by Jarmo Tonteri

Transcription

High Performance
Stainless and
Alloys BA
Jarmo Tonteri
Jürgen Olbrich
HPSA
Outokumpu
Outokumpu
Experience
2013
May 22-23, 2013
Old Billingsgate,
London, UK
Outline
1.
HPSA introduction
2.
High Performance Stainless strategy
3.
VDM strategy
4.
Summary
HPSA BA, Jarmo Tonteri
5/23/2013
2
HPSA accounts for 33% of group sales and
18% of group volumes
Q1 2013 External sales by BA 1)
Q1 2013 External deliveries by BA 1,2)
Group sales EUR 2.2 billion
Group deliveries 703,000 tonnes
HPSA
HPSA
EMEA 48%
Americas 10%
APAC 10%
HPSA 33%
EMEA 55%
APAC 12%
Americas 15%
HPSA 18%
1) Split by BA are based on management estimates. APAC figures include also direct sales and deliveries from other BAs to the region.
2) Incl. high performance alloy deliveries, excl. ferrochrome deliveries.
5/23/2013
3
High Performance Stainless and Alloys
operates in the attractive high-end of the market
Price
Zirconium
High Performance Titanium
stainless and Nickel
Alloys
• Highly tailored material solutions to
the most demanding environments
• High-end stainless steel, Nickel,
Titanium and Zirconium alloys
Stainless
Material performance
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4
Chemical, petrochemical and energy as the
single most important customer segment
HPSA Sales by customer segment
HPSA Sales by end‐customer segment
Heavy
industries
4%
Distributors 33%
Consumer
Other goods &
7 % Medical
3%
Automotive
& heavy
transport
18 %
Architecture,
Building &
Construction
4%
Metal
processing
& Tubes 24%
End users & processors 67%
Chemical,
petrochemical
and energy
39%
5/23/2013
5
Application areas across key customer
segments
Desalination – Evaporators
Storage tanks
The high corrosion resistance and strength of LDX 2404®
Chemical industry
Solar panel industry
Flexible
lines
mean it can be used as a complement or substitute in applications where austenitic molother duplex grades such as 2205 have traditionally been Process Equipment
Bridges
used.
Pressure vessels
Courtesy of Kvaerner
Chemical tankers
5/23/2013
6
HPSA financial highlights
•
•
•
Q1 2013 deliveries grew by 18% to
159.000 tonnes compared to Q4
2012
EBIT rose to EUR 14 million driven
by higher deliveries, better mix,
increased prices and reduced fixed
cost.
Capex for Q1 was EUR 30. Main
projects include:
•
•
•
Quarto Plate expansion project
VDM strategic investment program
Q4/12
FY2012
comparable
comparable
159
134
597
Sales 2)
798
689
3,226
EBITDA
35
-9
114
EBIT
14
-120
-70
-
-93
-94
4.776
4.764
4.764
30
na
115
EUR million
Q1/13
Deliveries 1)
Non-recurring
items in EBIT
Employees
Capex
Headcount remained stable at
4.776 out of which VDM unit
accounted for 2.000 employees
1) 1,000 tonnes, incl. internal deliveries, 2) Incl. internal sales
5/23/2013
7
Outline
1.
HPSA introduction
2.
3.
VDM strategy
4.
Summary
5/23/2013
8
High Performance Stainless (HPS)
Value proposition
•
•
•
•
Unparalleled technical expertise to recommend the best possible
steel grades and material solutions to the most demanding
environments
Full range of high performance stainless steel grades and product
forms
High quality & high reliability production facilities
Material performance
•
•
•
•
•
High corrosion, acids and saline water resistance
High heat resistance and machinability
High strength that brings e.g. weight savings
Better durability and reduced maintenance requirements
Leader in environmental performance
HPS offers customers in-depth know-how on advanced materials
and delivers high performance stainless steel to the most
demanding environments and applications
5/23/2013
9
HPS is market leader in special stainless steel
grades with more than 30% market share
Duplex
Duplex - High strength and
corrosion resistance enabling
durable light weight
constructions
High Alloyed
Austenitic
HAA – high alloyed austenitic
stainless steels for safe and
efficient process technology
Heat Resistant
253 MA® – Micro-alloyed
heat resistant grades for
highly efficient exhaust
gas systems
5/23/2013
10
Unparalleled technical expertise
•
In house state of the art R&D team dedicated to the
development of high performance stainless grades
•
Alloy development since the 1920’s using state of the
art in-house computer simulations and laboratory
resources
•
Active in development projects and research
programmes together with customers & national and
international research bodies
•
Industry leading customer support in terms of material
selection and fabrication
5/23/2013
11
Cold Rolling
Hot Rolling
Melting
HPS Production setup
Special Coil
Thin Strip
Avesta & Nyby,
Sweden
Kloster,
Sweden
Special Plate
Degerfors,
Sweden
New Castle,
US
Long Products
Sheffield, UK
Degerfors,
Sweden
Richburg, US
500
500
160
700
160
45
Coil
Precision strip
160
Plate
70
70
Plate
40 & *
80
105
Long Products
30*
50
60
Bar & Long Products
Bar
Actual capacities will vary according to product mix and manning
* Hire rolling from third party
5/23/2013
12
HPS implemented a major business model
renewal in 2011-2012
•
Starting point in 2010-2011
•
•
•
•
Heavy losses in the specialty stainless units in Sweden
High fixed costs compared to sales volumes and margins
Inconsistent pricing discipline
New strategy formulated and implemented in 2011-2012
•
•
•
•
•
Optimization of production and fixed cost savings in key mills through reduction in
shifts & manning
Reduction of other fixed and variable costs
Focus on special grades with high value added
Increasing prices
Cutting the tail of the customer base (discontinuing business with the least profitable
customers)
Results: Clear product and pricing strategy, reduced costs,
positive EBIT in Q1 2013 despite weak market
5/23/2013
13
HPS consists of four Business Lines
High Performance
Stainless & Alloys
High Performance Stainless
Special Coil
Thin Strip
Special Plate
High Performance
Allloys
Long
Products
VDM
5/23/2013
14
Special Coil
Special Coil
Avesta & Nyby
• Product focus
•
•
Hot band, Cold rolled coil and sheet, 2 meter wide
Focus on special grades (high alloyed austenitic, Duplex, Heat resistant grades)
• Key applications / customer segments
• Tanks, pressure vessels, welded and flexible tubes, for •
•
•
•
•
Energy Industry, particularly oil & gas
Chemical & petrochemical, including pulp & paper
Mining & Metals
Desalination, water treatment and ‐heating
Food & beverage
• Structural components for construction and transport
• Key priorities for 2013:
•
Leverage expertise, quality and reliability to grow special coil products business globally
5/23/2013
15
Thin Strip
Thin strip
Kloster
• Product focus
•
•
Stainless Coil with focus on precision tolerances – Thicknesses down to 0.1 mm
Special stainless steel grades
•
•
•
•
•
Plate Heat Exchanger
Gaskets
Flexible Tubes
Heating Elements
Precision Stamping Building & Construction
Automotive
Automotive
Catering & Appliance
Process & Resources
•
•
•
Grow in Special Grades
Fine tune raw material sourcing
Continue with price over volume
5/23/2013
16
Special Plate
Special Plate
Degerfors (Sweden), New Castle (US)
• Product focus:
•
•
Thick, wide, and individually rolled quarto plates that are used in most demanding applications Tailor made products and special grades
•
•
•
•
•
Energy Industry
Chemical Transportation
Desalination
Pressure Cylinders, Tanks, Thick‐walled Tubes
Bridge Structures
•
•
•
Leverage technical expertise to win new customer projects
Expand business in APAC
Finalization of the ongoing Plate investment program to enhance the capabilities and capacity
5/23/2013
17
Long Products
Long Products
Sheffield (UK), Degerfors (Sweden), Richburg (USA)
• Product focus:
•
•
Slab, bloom, billet, rod coil and bar, including stainless reinforcing bar
Wide variety of long products, standard and special grades
•
•
•
•
•
Bridge structures, ABC
Chemical and petrochemical processing Electronics & automotive
Food and beverage processing Machining of valves, fittings, and other components
•
•
•
•
Investments in bar production in US
Capitalizing duplex and super duplex offerings
Continuous product development
Increasing market share in Europe
5/23/2013
18
Outline
1.
HPSA introduction
2.
3.
VDM strategy
4.
Summary
VDM introduction and strategy, Dr. Jürgen Olbrich
5/23/2013
19
VDM introduction
& strategy
Dr. Juergen Olbrich
President & CEO
Outokumpu VDM
Outokumpu
Experience
2013
May 22-23, 2013
Old Billingsgate,
London, UK
Outokumpu VDM - Company Profile
Outokumpu VDM Production Sites
Global Sales Network
Outokumpu VDM HQ
~ 64 of sales generated in
Europe (~34% in Germany)
Production sites close to
innovative global players in
key industries


1 Unna
Nickel Melting / Forging
2 Siegen
Hot Rolling
Germany
6
51
34

2

Altena
3 Rod & Bar / Plate
4 Werdohl
Strip/Wire/Service Center

5 Essen
~ 23 of sales generated in
North America
Access to strong US
Aerospace and Oil & Gas
market
Local production eliminates
€/$ FX risk
Titanium Melting
6 Duisburg
B2


7
Florham Park
Melting
8
2

USA
7
8 Reno
Rod&Bar

~ 13% of sales generated in
Asia
Strong access to growing
Chinese market
Presence in India and the
Middle East; representative
office in Moscow
Long-dated presence in
Australia with highly
profitable service center
5/23/2013
21
Outokumpu VDM - Covers top end of the highdemanding steel material pyramid
Complementary offering between Stainless
and VDM business
Overview Global business
Forgings
high
Other
Zirconium Alloys 1)
Cobalt Alloys
Other
VDM
Nickel Alloys
Stainless
Titanium
Resistance
Titanium
Stainless
Steel Flat
VDM
Nickel Alloys
200
Grade
low
visual
appearance
300
Grade
400
Grade
Special
Grades
Stainless
Focus
material
performance
1) Zirconium produced in cooperation with Sandvik , note: Schematic, for illustration only
5/23/2013
22
Outokumpu VDM - One of only two players worldwide that offer
full HPA product range
Especially attractive for CPI project business where wide range of products required
HPA players
HPA product range
VDM
Nickel Alloys
Special Stainless
Steel 2)
Cobalt Alloys
Titanium and
Titanium Alloys
Zirconium
Nickel Alloys
Special Stainless
Steel
Cobalt Alloys
Titanium and
Titanium Alloys
Zirconium 1)
Nickel Alloys
Special Stainless
Steel
Cobalt Alloys
Titanium and
Titanium Alloys
Cobalt Alloys
Titanium and
Titanium Alloys
Nickel Alloys
Alloy Imphy
Nickel Alloys
Nickel Alloys
Special Stainless
Steel
Cobalt Alloys
Cobalt Alloys
1. Included in "Exotic Alloys" also containing hafnium and niobium alloys, 2. Product characteristics of special stainless steels are located between regular
stainless steels and Nickel alloys, e.g. steels with Nickel content > ~8% found in standard 304 grades Note: Stainless steel and powder metal products
not considered as part of HPA portfolio, source: Company annual reports
5/23/2013
23
Outokumpu VDM - Product Portfolio
Nickel Alloys largest segment with more than 130 alloys offered
Product forms offered
Alloys offered
Nickel Alloys Rod & Bar
Wire
Welding Consumables
High‐Temperature
Alloys
Wet Corrosion Alloys
Forging & Billets
Heat Resistant Alloys
Super‐
alloys
Special Alloys
Controlled Expansion
alloys
Strip
Magnetic
alloys
Plate & Sheet
Resistance
alloys
Nickel Alloys
Titanium
Titanium
Strip
Long Products
Plate
Commerical
Commercially ly Pure Low Alloyed
Alloyed
Others
Others
Plate
Zirconium
Cobalt
5/23/2013
24
Global outlook for all major industries promising
Aerospace / Turbines
Chemical Process Industry
Value of new airplanes ($bn)
Value ($bn)
Chemical demand (€bn)
5%
Electronic & Electrical Engineering
3%
Oil & Gas
7%
90
83
78
6%
10%
3,206
105 106
81
Produced units (m)
Exploration & Production spending ($bn)
98
89
Automotive
497
83
3,722
69
537
574
85
436
2,996
74
89
94
98
77
2,800
1,871
'11 '12 '13 '14 '15 '16 '17 '18 '19 '20
Lagging recovery from crisis
due to long-term contracts
But: Strong growth trend
global mobility, especially in
emerging markets
2009
2030
Growth driven by:
 Strong economic
development in
emerging countries
 Fast population growth
(8bn in 2030)
2010
2011
2012
Largest industry sector
worldwide
Growth momentum evenly
carried by Europe and US
2010
2011
2012
2013
Increased E&P spending
driven by:
 More exploration
activity
 More difficult conditions
2010 2011 2012 2013 2014 2015
Growth driven by:
 Increasing wealth in
emerging markets
 Increased need for
mobility
(e.g. deepwater)
Source: Company information, Aerospace: TEAL Group commercial airliner forecast; CPI: CEFIC Fact and Figures 2010;
E & E: ZVEI 2011; Oil & Gas: Rystad Energy, DnBNOR; Automotive: IHS Global Insight Report 2010
5/23/2013
25
Highly attractive growth pockets for HPA in end
customer industries
Aerospace
Oil & gas
Chem. process industry
Automotive
Electrical & Electronics
Lightweight construction
(light high‐strength materials)
Sour well exploration
(high corrosion resistance)
Desalination plants
(high corrosion resistance)
Emission control systems
(high temperature)
Large engines and planes
(high‐strength materials)
Shafts for deep off‐shore drilling
(high strength materials)
700°C power plants
(high temperature)
Downsized engines
(high temperature)
Concentrated Solar Power (high temperature)
Next generation power lines
(high temperature)
Turbo chargers
(high temperatures)
Deepwater Drilling1
Titanium usage (by weight)
Tons
200
# of wells drilled
+92%
300
150
100
50
100
0
0
Boing 747
A380
Mm³/day
139
27
2010
98
64
50
2010
+13%
30
20
0
2015
Emission Control Systems
in US$ bn
+9%
100
+39%
200
Desalination Capacity
2015
30
CSP capacity
GW
40
16
10
20
0
0
2010
2015
+35%
20
1
2010
2020
1. Deepwater >1500m; Source: Goldman Sachs Equity Research 2011, GWI, Continental Factbook,
SupplierBusiness, AeroStrategy, Cowen and Company; Emerging Energy Research
5/23/2013
26
Outokumpu VDM - Strong R&D capabilities and proven
innovation leadership form base for future growth
VDM with strong product pipeline …
Project: 700°C power plant



Project Status: Completed
Energy companies aim to increase the
electrical current in power grids
VDM developed a special alloy preventing
thermal expansion and sagging of power
lines at high currents
Project: Aerospace alloys


Patent applications in last 5 years*
Project Status: Completed
Energy companies try to increase
efficiency of power plants via higher
temperatures in steam boilers
VDM developed a heat resistant alloy now
tested in steam boiler materials
Project: Power lines

… mirrored by high number of patents
25
Achieved through strong cooperation
with clients and leading metallurgy
universities in Germany
20
15
23
10
16
5
6
Project Status: Advanced
Aerospace trend to more efficient
engines and lightweight construction
VDM in certification for Ni-based rotating
parts in engines to complement existing
aerospace business
1
0
Sales 2012
(in US$m)
4
VDM
VDM
ATI
1,685
5,000
1
2
SMC
Carpenter
Haynes
7,892
1,797
565
1. ATI's patents also for stainless steel products 2. PCC patents only for HPA, * 01.01.2007 – 31.12.2011
Note: Patent numbers are family patent applications in respective countries securing the right to priority; VDM patents do not include withdrawn patent applications,
other numbers can include withdrawn or rejected applications, source: Company annual reports, DepatisNET
5/23/2013
27
Outokumpu VDM - Expand and upgrade
production process
Summary
Advantages
Bisher
Altena
Forged & Rolled
bars
12/13
Altena
Rolled bars


CAPEX
~ €35M
Start
Q4 2011
Improving of the
market access
Optimization of the
Production process
Unna
Forged bars
Relocation forged bars to Unna
Capacity expansion at both sites
Positive
cost effect
Project status
Construction status – forge adjustage Unna
31.05.12
17.07.12
28.02.13
05.05.13
5/23/2013
28
Outokumpu VDM - Strategic milestones and
future strategic fields
Cornerstones
Capitalize on
growth in key
industries
Key activities
• Leverage strong industry knowledge and relationship
• Focus on niches with exceptionally high demand in HPA
Expand position in
emerging markets
• Capitalize on upgraded service center in China
• Leverage newly founded subsidiary in Shanghai
• Strengthen footprint in Russia, Brazil & India
Expand & upgrade
production process
• Invest budget to maximize growth/efficiency potential
• Reduce lead times with new inventory mgmt. System*
• Capitalize investments in new bar capacity
Leverage strong
R&D pipeline
• Gain access to Ni alloys in rotating aerospace parts
• Market mission-critical materials for energy industry
*Cash Conversion Cycle will be out from 151 days in 2010/11 to 116 days in 3 years
5/23/2013
29
Outline
1.
HPSA introduction
2.
3.
VDM strategy
4.
Summary
5/23/2013
30
HPSA - summary
•
Highly tailored material solutions to the most
demanding environments
•
•
•
Strong market position and excellent reputation
globally
•
•
•
•
•
•
High performance stainless steel
High performance alloys (VDM)
Technical expertise
Product quality
Delivery reliability
Highly committed management team and employees
Streamlined cost base in HPS – once market demand
recovers, potential for attractive profits and return on
assets
Strategic review of the VDM unit under way. Decisions
to be made by end of 2013
5/23/2013
31
Q&A
Outokumpu
Experience
2013
May 22-23, 2013
Old Billingsgate,
London, UK

HPSA presentation by Jarmo Tonteri

Transcription

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