AGENDA. Tupy at a glance. Tupy and SinterCast

Transcription

1 Tupy Presentation

2 AGENDA Tupy at a glance Tupy and SinterCast

3 2 COMPANY HISTORY ( ) Global footprint Start-up Company founded in Joinville, Santa Catarina, Brazil, by German immigrants in order to produce cast iron pipe fittings Automotive Sector Entrance into the automotive sector through VW Research Center creation in parnership with Universidade Sao Paulo (USP) Production of engine blocks and heads initiated Segment Diversification Acquisition of control of Tupy by institutional investors Acquisition of Sofunge (a Mercedes-Benz Captive foundry) 1998 Acquisition of foundry in Mauá/SP Increased exposure to heavy vehicle segment Implementation of new strategic agenda and financial restructuring Mexico acquisition Leadership in manufacturing Iron Engine Blocks & Heads in Americas/Europe Re-IPO Bond issuance

4 Automotive (92%) Iron Engine Blocks and Heads Engineered Parts Machining Hydraulics ( 8%) Pipe Fittings Iron Bars and Shots 3 TUPY AT A GLANCE Product Portfolio Key Statistics Iron Engine Blocks and Heads Other Auto-parts Exhaust Manifold Where can you find Tupy s products? Commercial Trucks 2014 Revenue R$3,114 MM (USD 1,173 MM) 2014 Adj. EBITDA R$507 MM (USD 191 MM) Engine Head 2014 EBITDA Margin 16.3% Pick-Ups Number of Plants 4 Engine Block Employees 12,000 Machinery Automotive Customers 50+ Crankshaft Flywheel Bearing Cap Passenger Cars Geographic Revenue Breakdown (2014) By End Market Pipe Fittings Iron Bars and Steel Shots List does not include all of Tupy s products Transportation of liquids and gases for commercial and industrial use Shots and grits are used as process materials to feed marble/granite cutting machines Continuous cast iron bars are used as raw material for the manufacturing of several industrial products Europa 15% 29% LatAm Other 4% Hydraulics Light vehicles 8% 21% Off-road 28% 52% NAFTA 43% Commercial vehicles

5 1) According to Company s estimates; Americas and Europe 4 LEADING PRODUCER OF IRON BLOCKS & HEADS WITH SCALE AND FLEXIBILITY Market Large share scale -production Iron blocks capacity and heads ¹ Market share - Iron blocks and heads ¹ Ramos Arizpe Capacity : 92 kton/year Area: 358,000 m² Employees: ~1,000 Saltillo Capacity: 216 kton/year Area: 223,000 m² Employees: ~2,000 Company A Company B Company C Company D Company E 25% Mauá/SP Capacity: 100 kton/year Area: 100,000 m² Employees: ~1,000 Joinville/SC Headquarters Capacity: 440 kton/year Area: 1,208,000 m² Employees: ~7,000 Manufacturing Flexibility Ability to serve different markets (heavy, off road and light vehicles) Parts ranging from 1kg to 600kg Several cast iron grades (CGI, ductile, grey and malleable) Delivery of pre or fully machined parts

6 DOMINANT MARKET SHARE AND SUPERIOR RELATIONSHIP WITH CLIENTS Market Share Iron Blocks and Heads ¹ Best in Class Clients Portfolio Off Road Commercial Passenger Cars 57 Years 51 Years 51 Years Americas #1 #1 #1 33 Years 28 Years 19 Years Europe #4 #6 #7 18 Years 15 Years 11 Years Other Clients Western Hemisphere #1 #1 #4 Includes: Construction Machinery, Mining Vehicles, Industrial Machinery, etc. Includes: Class IV - VIII Commercial Trucks, Pick-Ups and Buses Includes: Passenger Cars, SUVs, Light Pick-Ups, Luxury Cars, etc. 1) Company estimates 5

7 AGENDA Tupy at a glance IN DISCUSSION Tupy and SinterCast

8 DEVELOPMENT OF CGI IN TUPY Initial research and development Tupy s Main Initiatives and Contributions Tupy and SinterCast have worked together to develop the CGI technology and market since 1997 Gray Iron Ductile Iron CGI In 1976, Tupy published its first paper about experiments with CGI First class research and development partnership Tupy has also developed prototypes in CGI, developing, along with SinterCast, the technology to obtain engine blocks The company s first trial with SinterCast was in 1997 (Cifunsa, today a Tupy plant, made a first trial in 1994) The first installation occurred in 2000 In 2001, Tupy mastered the utilization of CGI for the large scale manufacturing of engine blocks and signed its first deal with Ford Today, Tupy is the largest and most diversified CGI producer in the world The company constantly supports and promotes the research in universities and partnerships with producers of machining tools Currently, Tupy is the world s largest and most diversified producer of engine blocks in CGI 7

9 8 DIRECT BENEFITS OF THE PARTNERSHIP FOR TUPY Financial Results Tupy posted an EBITDA margin of 17.4%, its highest since 1Q10; this has much to do with the share of high tech, high margin CGI products in the sales portfolio Growing demand for CGI products helps offset negative trends in the domestic market Operational Efficiency Efficiency gains in the operation were also imperative for the margin growth; SinterCast s Efficiency Campaign provides a detailed monthly summary of results and suggests opportunities to improve efficiency Supplier Quality Index SinterCast regularly achieves the maximum score and is one of our highest ranking suppliers (Excerpt from the report) CGI helps offset negative domestic market trends and increase margins

10 9 CGI IN TUPY S SALES PORTFOLIO Recent years Automotive sales [kt] CGI 8% 10% 9% 8% 10% Most significant CGI volumes

11 10 CGI IN TUPY S SALES PORTFOLIO Automotive sales (tonnage) 1Q % Most significant CGI volumes

12 SELECTED CGI PROGRAMS IN TUPY S PORTFOLIO Used in several vehicles, such as Audi A6, A7, A8, Q5 e Q7, Volkswagen Touareg and Phaeton, Porsche Cayenne V6 3.0L Turbodiesel Engine (Euro 6) V6 EcoBoost 2.7L Gasoline: new generation of the most successful pick-up truck in the world: the F-150, along with other applications First CGI application for a gasoline engine High powered diesel engine Chrysler s RAM truck is one of the applications Other applications: Grand Cherokee, Maseratti Ghibli