Month on Month Sales- KMT Tooling+WIDIA+INFRA

Transcription

48th AGM Kennametal India Limited
Bangalore
November 05, 2013
Content
• FY 13 Review
• Medium term outlook
An overview of our business of last year and the outlook
© 2013 Kennametal Inc. l All rights reserved. l Proprietary and Confidential l 2
Disclaimer
This presentation may include statements which may constitute forward-looking statements. All statements that address
expectations or projections about the future, including, but not limited to, statements about the strategy for growth, business
development, market position, expenditures, and financial results, are forward looking statements. Forward looking
statements are based on certain assumptions and expectations of future events and involves known and unknown risks,
uncertainties and other factors. Kennametal India Limited (The “Company”) cannot guarantee that these assumptions and
expectations are accurate or exhaustive or will be realized. The actual results, performance or achievements, could thus
differ materially from those projected in any such forward-looking statements. No obligation is assumed by the Company to
update the forward-looking statements contained herein.
The information contained in these materials have not been independently verified. None of the Company, its Directors,
Promoter or affiliates, nor any of its or their respective employees, advisers or representatives or any other person accepts
any responsibility or liability whatsoever, whether arising in tort, contract or otherwise, for any errors, omissions or
inaccuracies in such information or opinions or for any loss, cost or damage suffered or incurred howsoever arising, directly
or indirectly, from any use of this document or its contents or omission or otherwise whatsoever in connection with this
document, and makes no representation or warranty, express or implied, for the contents of this document including its
accuracy, fairness, completeness or verification or for any other statement made or purported to be made by any of them, or
on behalf of them, and nothing in this document or at this presentation shall be relied upon as a promise or representation in
this respect, whether as to the past or the future. The information and opinions contained in this presentation are current,
and if not stated otherwise, as of the date of this presentation. The Company relies on information obtained from sources
believed to be reliable but does not guarantee its accuracy or completeness. The Company undertake no obligation to
update or revise any information or the opinions expressed in this presentation as a result of new information, future events,
developments or otherwise. Any opinions or information expressed in this presentation are subject to change without notice.
©2012 Kennametal Inc. | All rights reserved. | 3
Kennametal India – At a Glance
Kennametal India Today
The Beginning
•
•
•
•
WIDIA incorporated in 1964
30 employees, one “shaping” plant
First one-ton press production in 1968
Kennametal acquired WIDIA in 2003
• More than 500 Active Customers
• ISO 9001-2008 Certification
• Diversified Product range
Key customers
Local manufacturing advantage
Senior Leadership Team
B. C. Rao
Managing Director
D. Parameshwar Reddy
Chief Financial Officer
Sarathy D
Vice President – Manufacturing
Vikram Chopra
Vice President – Sales
Chandrashekar Sharma K
Vice President – Sales
Dibesh Pratap Singh Deo
Chief Human Resources Officer
©
ll All
rights
Proprietary
and
l l 55
©2012
Inc. |l l All
rights reserved.
| 5
© 2012
2013 Kennametal
Kennametal Inc.
Inc.
AllKennametal
rights reserved.
reserved.
Proprietary
and Confidential
Confidential
FY 13 Review : Economic Environment
•
Interest Rates
– Interest rates high throughout the year and liquidity crunch continues
•
Business Confidence
- Cautious and low
•
Government policies
– Policy indecision
– Uncertainty and delays
•
Exchange rate
– Rupee depreciated more than 10% driven by high Current Account
Deficit
•
Input Cost
– Rising Energy cost and raw material prices
Extremely challenging market situation
IPI & GDP Trend %age
GDP
IPI
Source :http://planningcommission.gov.in/data/datatable/index.php?data=datatab
Significant slowdown in manufacturing industry
Served Markets Impacting our Business
•
Automotive production decline
– In specific HCV/CV
•
Steel Production
– Slow Down in growth rates
•
Capital tooling machinery decline by 34%
•
Mining & Construction
– Mining & Quarrying de grown at -2.9%
•
Aerospace , Defense & Railways
Source: * Capital tooling machinery - IMTMA
http://opengovernanceindia.org/pqlahmb/india-s-index-of-industrial-production-iip-march-2013
HCV/ CV effected us the most
(-25.3%)
HCV – Heavy Commercial Vehicles
CV – Commercial Vehicles
Source: SIAM
Heavy automotive production as well as core sector machineries output decline
Services
Reconditioning Services
Regrinding Center
Our Reconditioning Services program
optimizes the total value of customers
metal cutting tools throughout their
entire life cycle by providing following
advantages.
• Kennametal Proprietary Geometry
• Kennametal Certified Coatings
• Like New Performance.
• Reduced Lead time.
Supply Chain Services
Tool BOSS
ToolBOSS™ quickly and consistently delivers
quantifiable savings in hundreds of Metal Working
companies worldwide.
The Kennametal Shared Rewards program entitles
customers for free usage of the machines with volume
tie up.
Major events
•
IMTEX 2013, Bangalore
•
OFS (Offer for Sale)
– Promoter holding brought down from 88.16% to 75%
– Issue subscribed mainly by mutual funds (Reliance & SBI)
•
Emura Acquisition by promoter company undertaken would
enhance strategic sourcing of raw material
Quick reflections
•
What did not go well
– Low volume growth with direct customers
– Lack of entry into aluminum machining
– Delay in leveraging on new products of Conforma Clad and Extrude
Hone
– Low capacity utilization in factory with contraction in demand
•
What went well
– MSG (Machining Solutions Group) Business of Special Purpose
Machines grew by 22%
– Indirect channel expansion
– Initiatives on Services
– Focus on Aerospace
Highly challenging year with low demand
MSG Sales @ ₹ 1000 Million in FY 13
₹ in Mn
Machining Solutions Group/Machine Tools Business (MSG/MTB)
₹ 1000 Million is landmark achievement in special purpose machines
KIL Key Performance Indicators – Fy13
Key Performance Indicators
Fiscal Year 2013 (Rs. Mn)
FY13
FY12
Fav/(Unf)
•
Tooling Sales down 20% vs PY partially
offset by MTB growth(22%)
•
Profitability down due to :
• Poor plant loading
• Aggressive pricing in the market.
Sales
4,894
5623
-13%
EBIT
196
989
-80%
EBIT % (to Sales)
4%
18%
1400 bps
EPS
6.8
31.1
-78%
Cash From Operations
465
1179
-61%
Return on Capital
Employed (ROCE)
6%
33%
-27%
•
IMTEX cost for the year – Rs 35Mn
-
-
-
•
ROCE down due to low profitability
Debt to Capital
•
•
Unfavorable product mix
Increasing input costs (raw material,
employment and energy costs
Most challenging year for KIL in a decade
Financial Results & Trends
Sales (₹ Mn)
5069
6000
3902
3055
4000
Revenue Break-up – FY13
5623
4894
3723
2000
0
FY08 FY09 FY10 FY11 FY12 FY13
EBITDA Margin
20%
20%
27%
30%
25%
PAT Margin
23%
23%
20%
22%
16%
10%
15%
10%
15%
17%
14%
14%
12%
13%
9%
8%
5%
3%
5%
0%
0%
Cash Flow and Uses (₹ Mn)
Primary Working Capital
25%
21%
20%
21%
Operating Cash Flow
19%
17%
1119
1200
22%
19%
1000
909
806
711
800
15%
1179
600
10%
465
400
5%
200
0%
0
% of Sales
21%
30%
CAPEX
500
445
22%
21%
10%
Dividends
894
1000
439
349
400
19%
800
292
324
300
219
200
639
600
332
400
96
100
200
0
0
% of Sales
11%
10%
% of Sales
0%
3%
7%
8%
4%
0%
130%
350%
250%
0%
© 2013 Kennametal Inc. l Alland
rights reserved.
l Proprietary and Confidential
Strong Cash Flow Funds Business Reinvestment
Dividends
l 18
Medium Term Outlook
IIP & GDP %age Trend
RBI surveyors lower India GDP forecast to 4.8% in 2013-14
IIP
Source :http://planningcommission.gov.in/data/datatable/index.php?data=datatab
India’s GDP is driven by Services sector; manufacturing is 14% of GDP
Medium Term Outlook
•
Recent acquisitions like ATI
•
by the Parent Co. would help
Auto sector (MHCVs & LCVs)
continues to decline inflation
to enhance our offerings and
continues to be a concern.
market penetration.
•
•
Tractors, Defense, Railways
Bold actions unlikely from
government in view of the
and export oriented
upcoming general election.
customers expected to show
signs of growth.
•
Rising energy cost and raw
material is a concern.
Challenging economic scenario
© 2011 Kennametalcontinues
Inc. l All rights reserved.
l Proprietary and Confidential l 21
Our Goal: Become A More Diversified
Industrial Leader
5 – Year Kennametal Inc. Global Growth Vision
Balanced Geographies
Western
Europe
Rest Of
World
Balanced Businesses
Infrastructure
Industrial
North
America
• Double Current Revenues
• Focus on 15 – 20% EPS Returns
• Maintain Investment Grade Ratings
Diversified End Markets
Sales KMT
FY13
%
KMT
+ATI
FY14
INDR
57%
54%
INFR
43%
46%
Transportation New
Markets
Aerospace
General
Engineering
Earth
works Energy
• Drive >15% EBIT Margins
• Deliver >15% Return On Invested Capital
• Double Inventory Turns
Thank You

Month on Month Sales- KMT Tooling+WIDIA+INFRA

Transcription

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