Highlights
-
Steel Shipments of 1,917 thousand tonnes
in 2016, a 2% increase compared to steel shipments of 1,886
thousand tonnes in 2015.
-
EBITDA3 of USD 492 million, including a
non-recurring charge of USD 11 million, in 2016, compared to EBITDA
of USD 501 million in 2015.
-
EBITDA of USD 133 million, including a
non-recurring charge of USD 11 million, in Q4 2016, compared to
EBITDA of USD 124 million in Q3 2016.
-
Net debt5 of USD 154 million as of
December 31, 2016, representing a gearing6 of 6% compared to a net
debt of USD 316 million as of December 31, 2015, representing a
gearing of 14%.
Aperam
(referred to as "Aperam" or the "Company") (Amsterdam, Luxembourg,
Paris: APAM and NYRS: APEMY), announced today results for the three
months and full year periods ending December 31, 2016
Timoteo Di Maulo, CEO of Aperam,
commented:
"In 2016, Aperam
achieved record financial results since the spin-off, with net
income of USD 214 million and free cash flow before dividend of USD
288 million. This highlights the strong execution of our Leadership
Journey®7 and Top Line strategy, reaching a solid balance
sheet.
Looking ahead, we remain confident in the ability of Aperam to
continue to improve its sustainable financial performance and its
solid cash generation.
Therefore, we are pleased to announce a base
dividend increase to USD 1.50 per share (subject to
shareholder approval) as well as a share buyback program of
up to USD 100 million."
Prospects
Financial Policy - Cash
Deployment
In coherence to its Financial Policy, Aperam is announcing 2 major
actions regarding cash deployment:
Financial Highlights
(on the basis of financial information prepared under IFRS)
(USDm)
unless otherwise stated |
Q4 16 |
Q3 16 |
Q4 15 |
12M
2016 |
12M
2015 |
Sales |
1,053 |
1,015 |
1,081 |
4,265 |
4,716 |
EBITDA |
133 |
124 |
105 |
492 |
501 |
Operating income |
83 |
81 |
65 |
317 |
327 |
Net income |
58 |
54 |
33 |
214 |
172 |
Free cash flow before dividend |
125 |
70 |
124 |
288 |
266 |
|
Steel shipments (000t) |
457 |
457 |
476 |
1,917 |
1,886 |
EBITDA/tonne (USD) |
291 |
271 |
221 |
257 |
266 |
Basic earnings per share (USD) |
0.75 |
0.69 |
0.42 |
2.75 |
2.21 |
Diluted earnings per share (USD) |
0.70 |
0.65 |
0.40 |
2.59 |
2.09 |
Health & Safety
results
Health and Safety performance based on Aperam personnel figures and
contractors' lost time injury frequency rate2 was 0.8x in the
fourth quarter of 2016 compared to 1.8x in the third quarter of
2016.
Financial results
analysis for full year period ending December 31, 2016
Sales for the year ended
December 31, 2016 decreased by 10% at USD 4,265 million compared to
USD 4,716 million for the year ended December 31, 2015, mainly due
to lower raw material prices. Steel shipments in 2016 increased by
2% at 1,917 thousand tonnes compared to 1,886 thousand tonnes in
2015.
EBITDA was USD 492
million for the year ended December 31, 2016, including a USD 11
million non-recurring and non-cash charge related to the announced
intention of divestment of the French Tubes units of Services &
Solutions division, compared to EBITDA of USD 501 million for the
year ended December 31, 2015. Despite headwinds coming from
challenging market conditions in South America and Alloys Division,
the company maintained its EBITDA level (excluding the impact of
the non-recurring charge) in the year primarily due to the
continuous contribution of the Leadership Journey®, the Top Line
strategy and a strong performance of Services & Solutions as
well as recovery of the stainless steel prices. The Leadership
Journey® has continued to progress over the year and has
contributed a total amount of USD 514 million to EBITDA by the end
of 2016 since the beginning of 2011.
Depreciation and
amortization was USD 167 million and impairment charges were USD 8
million for the year ended December 31, 2016.
Aperam had an operating
income for the year ended December 31, 2016 of USD 317 million
compared to an operating income of USD 327 million for the year
ended December 31, 2015.
Net interest expense and
other financing costs for the year ended December 31, 2016 were USD
43 million, including financing costs of USD 15 million. Realized
and unrealized foreign exchange and derivative gains were USD 3
million for the year ended December 31, 2016.
The Company recorded a
net income of USD 214 million, inclusive of an income tax expense
of USD 63 million, for the year ended December 31, 2016.
Cash flows from
operations for the year ended December 31, 2016 were positive at
USD 417 million, including a working capital increase of USD 26
million. CAPEX8 for the year ended December 31, 2016 was USD 130
million.
Free cash flow before
dividend for the year 2016 amounted to USD 288 million.
As of December 31, 2016,
shareholders' equity was USD 2,485 million and net financial debt
was USD 154 million (gross financial debt as of December 31, 2016
was USD 479 million and cash and cash equivalents were USD 325
million).
The Company had liquidity of USD 778 million as of December 31,
2016, consisting of cash and cash equivalents of USD 325 million
and undrawn credit lines9 of USD 453 million.
Financial results
analysis for the three-month period ending December 31,
2016
Sales for the fourth
quarter of 2016 increased by 4% to USD 1,053 million compared to
USD 1,015 million for the third quarter of 2016. Steel shipments
for the fourth quarter of 2016 were stable at 457 thousand tonnes
compared to the third quarter of 2016.
EBITDA has increased
over the quarter from USD 124 million for the third quarter of 2016
to USD 133 million for the fourth quarter of 2016. The fourth
quarter EBITDA includes a non-recurring charge of USD 11 million,
leading to an Adjusted EBITDA10 of USD 144 million for the fourth
quarter of 2016 compared to an Adjusted EBITDA of USD 124 million
for the third quarter of 2016. The seasonality in Brazil was more
than offset by the seasonal recovery in Europe, the continuous
recovery of the prices and the contribution of the Leadership
Journey®.
Depreciation and
amortization was USD 42 million and impairment charges were USD 8
million for the fourth quarter of 2016.
Aperam had an operating
income for the fourth quarter of 2016 of USD 83 million compared to
an operating income of USD 81 million for the previous quarter.
Net interest expense and
other financing costs for the fourth quarter of 2016 were USD 9
million, including financing costs of USD 3 million. Realised and
unrealised foreign exchange and derivative gains were USD 4 million
for the fourth quarter of 2016.
The Company recorded a
net income of USD 58 million, inclusive of an income tax expense of
USD 20 million, for the fourth quarter of 2016.
Cash flows from
operations for the fourth quarter of 2016 were positive at USD 163
million, with a working capital decrease of USD 9 million. CAPEX
for the fourth quarter was USD 39 million.
Free cash flow before
dividend for the fourth quarter of 2016 amounted to USD 125
million.
Operating segment
results analysis
Stainless & Electrical Steel
The Stainless &
Electrical Steel segment had sales of USD 883 million for the
fourth quarter of 2016. This represents an 8% increase compared to
sales of USD 819 million for the third quarter of 2016. Steel
shipments during the fourth quarter were 452 thousand tonnes. This
is a 3% increase compared to shipments of 438 thousand tonnes
during the previous quarter. The volume increase was mainly due to
the traditional seasonal recovery in Europe following the summer
seasonal effect. Overall, average selling prices for the Stainless
& Electrical Steel segment increased compared to the previous
quarter.
The segment had EBITDA of USD 410 million (of which USD 286 million
from Europe and USD 124 million from South America) for the year
2016 compared to USD 438 million (of which USD 243 million from
Europe and USD 195 million from South America) for the year 2015.
The Brazilian market has been challenging over 2016 due to
macro-economic environment and foreign exchange effects which have
been partly mitigated thanks to the Top Line strategy and
Leadership Journey®. The strong performance of Europe over 2016 is
mainly due to the continuous contribution of the Leadership
Journey®, healthy demand in Europe and some stainless steel prices
recovery during the second half of the year.
The segment had EBITDA of USD 117 million for the fourth quarter of
2016 compared to USD 102 million for the third quarter of 2016. The
seasonality in Brazil was more than offset by the seasonal recovery
in Europe and the continuous recovery of the stainless steel
prices.
Depreciation and
amortisation expense was USD 37 million for the fourth quarter of
2016.
The Stainless &
Electrical Steel segment had an operating income of USD 80 million
during the fourth quarter of 2016 compared to an operating income
of USD 65 million during the third quarter of 2016.
Services & Solutions
The Services &
Solutions segment had stable sales during the quarter at USD 472
million compared to USD 473 million during the third quarter of
2016. During the fourth quarter of 2016, steel shipments were 187
thousand tonnes compared to 189 thousand tonnes during the previous
quarter. The Services & Solutions segment had higher average
selling prices during the period compared to the previous period.
The segment had EBITDA of USD 82 million during the year 2016
compared to USD 42 million during the year 2015, due to better
margins and shipments over the year as well as the absence of
negative impact on inventories from the nickel price evolution
compared to 2015.
The segment had EBITDA for the fourth quarter of 2016 of USD 12
million compared to EBITDA of USD 24 million for the third quarter
of 2016. The decrease of EBITDA was primarily due to a
non-recurring and non-cash charge of USD 11 million in relation
with the fair valuation of a French stainless steel welded tubes
unit which is held for sale.
Depreciation and
amortisation was USD 3 million and impairment charges were USD 8
million for the fourth quarter of 2016.
The Services &
Solutions segment had an operating income of USD 1 million for the
fourth quarter of 2016 compared to an operating income of USD 20
million for the third quarter of 2016.
Alloys
& Specialties
The Alloys & Specialties segment had sales of USD 108 million
for the fourth quarter of 2016, representing an increase of 19%
compared to USD 91 million for the third quarter of 2016. Steel
shipments were higher during the fourth quarter of 2016 at 8
thousand tonnes compared to 7 thousand tonnes during the third
quarter of 2016. Average selling prices decreased over the
quarter.
The segment had EBITDA of USD 30 million for the year 2016 compared
to USD 44 million for the year 2015. This is mainly due to the
negative effects from raw material prices evolution, forex
translation effects and some indirect headwinds from Oil & Gas
related markets.
The Alloys & Specialties segment achieved EBITDA of USD 12
million for the fourth quarter of 2016 compared to USD 5 million
for the third quarter of 2016. The increase in EBITDA was mainly
due to market demand recovery and sales mix effects.
Depreciation and
amortisation expense for the fourth quarter of 2016 was USD 1
million.
The Alloys &
Specialties segment had an operating income of USD 11 million for
the fourth quarter of 2016 compared to an operating income of USD 3
million for the third quarter of 2016.
Recent
developments
-
On December 15, 2016
Aperam announced its financial calendar for 2017. The financial
calendar is available on the Company's website www.aperam.com,
section Investors & shareholders, Financial calendars.
-
On January 9, 2017,
Aperam announced its intention to divest Aperam Stainless Services
& Solutions Tubes Europe, its French stainless steel welded
tubes unit, after consideration of a binding offer it received on
December 30, 2016.
-
On January 20, 2017,
Standard & Poor's Global Ratings affirmed the Aperam Corporate
credit rating at BB+. At the same time, the rating agency revised
its outlook to "Positive" from "Stable".
New developments
-
On February 9, 2017
Aperam announced its detailed dividend payment schedule for 2017.
The Company also proposes to increase its base dividend from USD
1.25/share to USD 1.50/share, subject to shareholder approval at
the 2017 Annual General Meeting, as the company continues to
improve its sustainable profitability benefiting from its strategic
actions. The schedule is available on Aperam's website
www.aperam.com, section Investors & shareholders, Equity
Investors, Dividends.
-
On February 9, 2017
Aperam announced a share buyback program of up to one hundred (100)
million USD and a maximum of two (2) million shares under the
authorization given by the annual general meeting of shareholders
held on May 5, 2015. The details of the program are available in a
separate Press Release.
Investor conference
call
Aperam management will
host a conference call for members of the investment community to
discuss the fourth quarter 2016 financial performance at the
following time:
Date |
New York |
London |
Luxembourg |
Thursday,
February 9, 2017 |
12:30
pm |
5:30
pm |
6:30
pm |
The dial-in numbers for the call are:
France (+33 (0)1 76 77 22 26); USA (+1 646 254 3388); and
international (+44 (0)20 3427 1901). The participant access code
is: 5674224#.
A replay of the conference call will be available until February
15th, 2017: France (+33 (0)1 74 20 28 00); USA (+1 347 366 9565)
and international (+44 (0)20 3427 0598). The participant access
code is 5674224#.
Contacts
Corporate Communications / Laurent Beauloye: +352 27 36 27
27
Investor Relations / Romain Grandsart: +352 27 36 27 36
About
Aperam
Aperam is a global player in stainless, electrical and specialty
steel, with customers in over 40 countries. The business is
organised in three primary operating segments: Stainless &
Electrical Steel, Services & Solutions and Alloys &
Specialties.
Aperam has 2.5 million
tonnes of flat Stainless and Electrical steel capacity in Brazil
and Europe and is a leader in high value specialty products. Aperam
has a highly integrated distribution, processing and services
network and a unique capability to produce stainless and specialty
from low cost biomass (charcoal). Its industrial network is
concentrated in six production facilities located in Brazil,
Belgium and France.
In 2016, Aperam had
sales of USD 4.3 billion and steel shipments of 1.92 million
tonnes.
For further information,
please refer to our website at www.aperam.com
Forward-looking statements
This document may contain forward-looking information and
statements about Aperam and its subsidiaries. These statements
include financial projections and estimates and their underlying
assumptions, statements regarding plans, objectives and
expectations with respect to future operations, products and
services, and statements regarding future performance.
Forward-looking statements may be identified by the words
"believe," "expect," "anticipate," "target" or similar expressions.
Although Aperam's management believes that the expectations
reflected in such forward-looking statements are reasonable,
investors and holders of Aperam's securities are cautioned that
forward-looking information and statements are subject to numerous
risks and uncertainties, many of which are difficult to predict and
generally beyond the control of Aperam, that could cause actual
results and developments to differ materially and adversely from
those expressed in, or implied or projected by, the forward-looking
information and statements. These risks and uncertainties include
those discussed or identified in Aperam's filings with the
Luxembourg Stock Market Authority for the Financial Markets
(Commission de Surveillance du Secteur Financier). Aperam
undertakes no obligation to publicly update its forward-looking
statements or information, whether as a result of new information,
future events, or otherwise.
APERAM CONDENSED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(in million of U.S. dollars) |
December 31,
2016 |
September 30,
2016 |
December 31,
2015 |
Non current assets |
2,773 |
2,802 |
2,642 |
Intangible assets |
565 |
592 |
556 |
Property, plant and equipments (incl. Biological
assets) |
1,691 |
1,732 |
1,652 |
Investments & Other |
517 |
478 |
434 |
|
|
|
|
Current assets & working
capital |
997 |
945 |
808 |
Inventories, trade receivables and trade
payables |
559 |
607 |
520 |
Other assets |
89 |
104 |
140 |
Cash and cash equivalents |
325 |
234 |
148 |
Assets held for sale |
24 |
- |
- |
|
|
|
|
Shareholders' equity |
2,485 |
2,527 |
2,222 |
Group share |
2,481 |
2,522 |
2,217 |
Non-controlling interest |
4 |
5 |
5 |
|
|
|
|
Non current liabilities |
768 |
757 |
883 |
Interest bearing liabilities |
275 |
273 |
450 |
Deferred employee benefits |
173 |
183 |
184 |
Provisions and other |
320 |
301 |
249 |
|
|
|
|
Current liabilities (excluding
trade payables) |
517 |
463 |
345 |
Interest bearing liabilities |
204 |
202 |
14 |
Other |
289 |
261 |
331 |
Liabilities held for sale |
24 |
- |
- |
APERAM CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS
(in million of U.S. dollars) |
Three Months Ended |
|
Year Ended |
December 31, 2016 |
September 30, 2016 |
December 31, 2015 |
|
December 31, 2016 |
December 31, 2015 |
Sales |
1,053 |
1,015 |
1,081 |
|
4,265 |
4,716 |
Adjusted EBITDA (E = C-D) |
144 |
124 |
105 |
|
503 |
501 |
Adjusted EBITDA margin
11 (%) |
13.7% |
12.2% |
9.7% |
|
11.8% |
10.6% |
Other items13 (D) |
(11) |
- |
- |
|
(11) |
- |
EBITDA (C = A-B) |
133 |
124 |
105 |
|
492 |
501 |
EBITDA margin12 (%) |
12.6% |
12.2% |
9.7% |
|
11.5% |
10.6% |
Depreciation, amortisation & impairment
(B) |
(50) |
(43) |
(40) |
|
(175) |
(174) |
Operating income (A) |
83 |
81 |
65 |
|
317 |
327 |
Operating margin (%) |
7.9% |
8.0% |
6.0% |
|
7.4% |
6.9% |
Loss from other investments and associates |
- |
- |
(3) |
|
- |
(15) |
Net interest expense and other net financing
costs |
(9) |
(12) |
(12) |
|
(43) |
(77) |
Foreign exchange and derivative gains /
(losses) |
4 |
(1) |
(5) |
|
3 |
(7) |
Income before taxes and
non-controlling interests |
78 |
68 |
45 |
|
277 |
228 |
Income tax expense |
(20) |
(14) |
(12) |
|
(63) |
(55) |
Effective tax rate % |
25.6% |
20.9% |
19.3% |
|
22.8% |
24.1% |
Income before non-controlling
interests |
58 |
54 |
33 |
|
214 |
173 |
Non-controlling interests |
- |
- |
- |
|
- |
1 |
Net income |
58 |
54 |
33 |
|
214 |
172 |
On December 31, 2016,
assets and liabilities of the French tubes business have been
classified as "Assets and Liabilities held for sale" as per IFRS 5
and are, therefore, presented separately in the consolidated
statements of financial position. The application of IFRS 5
triggered a non-recurring and non-cash charge of USD 22 million
that has been recognised in the consolidated statements of
operations as follows: USD 11 million in EBITDA (Other items), USD
8 million in Depreciation, Amortisation & Impairment and USD 3
million in Income tax expense.
APERAM CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
(in million of U.S. dollars) |
Three Months Ended |
|
Year Ended |
December 31, 2016 |
September 30, 2016 |
December 31, 2015 |
|
December 31, 2016 |
December 31, 2015 |
Net income |
58 |
54 |
33 |
|
214 |
172 |
Non-controlling interests |
- |
- |
- |
|
- |
1 |
Depreciation, amortisation and impairment |
50 |
43 |
40 |
|
175 |
174 |
Change in working capital |
9 |
(13) |
107 |
|
(26) |
(3) |
Other |
46 |
19 |
(11) |
|
54 |
48 |
Net cash provided by operating
activities (A) |
163 |
103 |
169 |
|
417 |
392 |
Purchase of PPE, intangible and biological assets
(CAPEX) |
(39) |
(33) |
(48) |
|
(130) |
(132) |
Other investing activities (net) |
1 |
- |
3 |
|
1 |
6 |
Net cash used in investing
activities (B) |
(38) |
(33) |
(45) |
|
(129) |
(126) |
Proceeds (payments) from payable to banks and long
term debt |
(3) |
(2) |
(30) |
|
(12) |
(279) |
Purchase of treasury stock |
- |
- |
(14) |
|
- |
(14) |
Dividend paid |
(24) |
(25) |
- |
|
(97) |
- |
Other financing activities (net) |
- |
- |
- |
|
(1) |
(3) |
Net cash used in financing
activities |
(27) |
(27) |
(44) |
|
(110) |
(296) |
Effect of exchange rate changes on cash |
(7) |
(1) |
- |
|
(1) |
(19) |
Change in cash and cash
equivalent |
91 |
42 |
80 |
|
177 |
(49) |
|
|
|
|
|
|
|
Free cash flow before dividend (C
= A+B) |
125 |
70 |
124 |
|
288 |
266 |
Appendix 1a - Health
& Safety statistics
Health & Safety Statistics |
Three Months Ended |
Year Ended |
December 31, 2016 |
September 30, 2016 |
December 31,
2015 |
December 31, 2016 |
December 31,
2015 |
Frequency
Rate |
0.8 |
1.8 |
0.7 |
1.4 |
1.0 |
Lost time injury frequency rate equals
lost time injuries per 1,000,000 worked hours, based on own
personnel and contractors.
Appendix 1b - Key
operational and financial information
Year Ended
December 31, 2016 |
Stainless & Electrical Steela,b |
Services & Solutions |
Alloys & Specialties |
Others & Eliminations |
Total |
Operational information |
|
|
|
|
|
Steel Shipment (000t) |
1,880 |
799 |
30 |
(792) |
1,917 |
Steel selling price (USD/t) |
1,817 |
2,366 |
13,046 |
|
2,162 |
|
|
|
|
|
|
Financial information |
|
|
|
|
|
Sales (USDm) |
3,510 |
1,964 |
415 |
(1,624) |
4,265 |
Adjusted EBITDA (USDm) |
410 |
93 |
30 |
(30) |
503 |
EBITDA (USDm) |
410 |
82 |
30 |
(30) |
492 |
Depreciation,amortisation & impairment
(USDm) |
(145) |
(22) |
(6) |
(2) |
(175) |
Operating income / (loss) (USDm) |
265 |
60 |
24 |
(32) |
317 |
Note a: Stainless & Electrical Steel
shipments of 1,880kt of which 639kt were from South America and
1,241kt were from Europe
Note b: Stainless & Electrical Steel EBITDA of USD 410m of
which USD 124m were from South America and USD 286m were from
Europe
Year Ended
December 31, 2015 c |
Stainless & Electrical Steela,b |
Services & Solutions |
Alloys & Specialties |
Others & Eliminations |
Total |
Operational information |
|
|
|
|
|
Steel Shipment (000t) |
1,836 |
746 |
34 |
(730) |
1,886 |
Steel selling price (USD/t) |
2,012 |
2,571 |
15,874 |
|
2,413 |
|
|
|
|
|
|
Financial information |
|
|
|
|
|
Sales (USDm) |
3,806 |
2,024 |
566 |
(1,680) |
4,716 |
Adjusted EBITDA (USDm) |
438 |
42 |
44 |
(23) |
501 |
EBITDA (USDm) |
438 |
42 |
44 |
(23) |
501 |
Depreciation & amortisation (USDm) |
(148) |
(18) |
(6) |
(2) |
(174) |
Operating income / (loss) (USDm) |
290 |
24 |
38 |
(25) |
327 |
Note a: Stainless & Electrical Steel
shipments of 1,836kt of which 654kt were from South America and
1,182kt were from Europe
Note b: Stainless & Electrical Steel EBITDA of USD 438m of
which USD 195m were from South America and USD 243m were from
Europe
Note c: Due to the transfer of the Business Unit "Precision" from
the segment "Services & Solutions" to the segment "Stainless
& Electrical Steel" as from January 1, 2016, segmented figures
for the year ended December 31, 2015 have been restated.
Quarter Ended
December 31, 2016 |
Stainless & Electrical Steel |
Services & Solutions |
Alloys & Specialties |
Others & Eliminations |
Total |
Operational information |
|
|
|
|
|
Steel Shipment (000t) |
452 |
187 |
8 |
(190) |
457 |
Steel selling price (USD/t) |
1,904 |
2,524 |
12,688 |
|
2,277 |
|
|
|
|
|
|
Financial information |
|
|
|
|
|
Sales (USDm) |
883 |
472 |
108 |
(410) |
1,053 |
Adjusted EBITDA (USDm) |
117 |
23 |
12 |
(8) |
144 |
EBITDA (USDm) |
117 |
12 |
12 |
(8) |
133 |
Depreciation, amortisation & impairment
(USDm) |
(37) |
(11) |
(1) |
(1) |
(50) |
Operating income / (loss) (USDm) |
80 |
1 |
11 |
(9) |
83 |
Quarter Ended
September 30, 2016 |
Stainless & Electrical Steel |
Services & Solutions |
Alloys & Specialties |
Others & Eliminations |
Total |
Operational information |
|
|
|
|
|
Steel Shipment (000t) |
438 |
189 |
7 |
(177) |
457 |
Steel selling price (USD/t) |
1,819 |
2,377 |
13,064 |
|
2,146 |
|
|
|
|
|
|
Financial information |
|
|
|
|
|
Sales (USDm) |
819 |
473 |
91 |
(368) |
1,015 |
Adjusted EBITDA (USDm) |
102 |
24 |
5 |
(7) |
124 |
EBITDA (USDm) |
102 |
24 |
5 |
(7) |
124 |
Depreciation & amortisation (USDm) |
(37) |
(4) |
(2) |
- |
(43) |
Operating income / (loss) (USDm) |
65 |
20 |
3 |
(7) |
81 |
1 The financial
information in this press release and Appendix 1 has been prepared
in accordance with the measurement and recognition criteria of
International Financial Reporting Standards ("IFRS") as adopted in
the European Union. While the interim financial information
included in this announcement has been prepared in accordance with
IFRS applicable to interim periods, this announcement does not
contain sufficient information to constitute an interim financial
report as defined in International Accounting Standard 34, "Interim
Financial Reporting". Unless otherwise noted the numbers and
information in the press release have not been audited. The
financial information and certain other information presented in a
number of tables in this press release have been rounded to the
nearest whole number or the nearest decimal. Therefore, the sum of
the numbers in a column may not conform exactly to the total figure
given for that column. In addition, certain percentages presented
in the tables in this press release reflect calculations based upon
the underlying information prior to rounding and, accordingly, may
not conform exactly to the percentages that would be derived if the
relevant calculations were based upon the rounded numbers. This
press release also includes Alternative Performance Measures ("APM"
hereafter). The Company believes that these APMs are relevant to
enhance the understanding of its financial position and provides
additional information to investors and management with respect to
the Company's financial performance, capital structure and credit
assessment. These non-GAAP financial measures should be read in
conjunction with and not as an alternative for, Aperam's financial
information prepared in accordance with IFRS. Such non-GAAP
measures may not be comparable to similarly titled measures applied
by other companies. The APM's used are defined in the following
footnotes.
2 Lost time injury frequency rate equals lost time injuries per
1,000,000 worked hours, based on own personnel and
contractors.
3 EBITDA is defined as operating income before depreciation and
impairment expenses.
4 Free cash flow before dividend is defined as net cash provided by
operating activities less net cash used in investing
activities.
5 Net debt refers to long-term debt, plus short-term debt, less
cash and cash equivalents (including short-term investments) and
restricted cash.
6 Gearing is defined as Net Debt out of Equity
7 The Leadership Journey® is an initiative launched on December 16,
2010, and subsequently accelerated and increased, to target
management gains and profit
enhancement. Aperam targets a contribution to EBITDA of a total
amount of USD 575 million by end of 2017, since the beginning of
2011.
8 CAPEX relates to capital expenditures and is defined as purchase
of tangible assets, intangible assets and biological assets, net of
change in amount payables on these acquisitions.
9 Includes borrowing base facility of USD 400 million (subject to
eligible collateral available) and EIB financing of EUR 50
million.
10 Adjusted EBITDA is defined as operating income before
depreciation and impairment expenses and other items13.
11 Adjusted EBITDA margin is defined as operating income before
depreciation and impairment expenses and other items divided by
sales.
12 EBITDA margin is defined as operating income before depreciation
and impairment expenses divided by sales.
13 Other items consists of (i) inventory
write-downs equal to or exceeding 10% of total related net
inventories values before write-down at the considered quarter end
(ii) restructuring charges/(gains) equal to or exceeding USD 10
million for the considered quarter, (iii) capital loss/(gain) equal
to or exceeding USD 10 million for the considered quarter or (iv)
other non-recurring items equal to or exceeding USD 10 million for
the considered quarter.